Transcripts For CNBC Closing Bell 20170303

We will have more details. Everybody seems to be cutting prices. Wireless carriers, online brokerages, but costco is going the other direction and raising its membership fee. Investors not exactly happy about that. Stock is down 4 right now. We have both signs of whether todays drop is a buying opportunity for investors. Thats all coming up here. And making work cool again. Mike row, the former host of dirty jobs testified to congress about the importance of blue collar ones. He will join us live to discuss closing that gap. I always liked mike. Very nice man. Start with our interview with wilbur ross on squawk. Hope you saw it. Kayla tausche has highlights for us. It was a wideranging conversation, but much of it focused on trade because secretary ross said that the president has trade top of mind for what ross will be doing over the next four years. Getting rid of both tariff and what he calls nontariff barriers to trade. They sort of took a trip around the globe and explored the casebycase basis that the administration is finding in each country. China if they have an overt trade policy that hurts china expect there could be a counter punch. Po on germany theyre part of the eurozone but the export engine germany has become is because of the low euro and took a tone on mexico saying that in order to level the Playing Field they might intervene to help mexicos currency instead of the America First hurt mexico. A change of tone for secretary ross. He acknowledged that currency policy normally falls to the Treasury Department but said that he, treasury secretary ma new chan and economic adviser gary cohn have lunch every week to get on the same page. Bringing back manufacturing jobs, hurt by some of those trade deals. Secretary ross this morning said a heavy Regulatory Environment is just as big a culprit. What are the regulations that are holding back manufacturing. I believe that we will find that its way into the tens of billions of dollars and possibly approaching hundred odd billions of dollars that we can deal with. Many of these were put in by executive orders and by agency rules and those wouldnt require acts of congress. So we are up to our eyeballs in trying to make sure we identify all the problems. Reporter the administration has, obviously, already tried to identify some of these problems with an executive order last week that ordered agencies to review some regulations, but kelly and bill, obviously the administration has a very long todo list and much of the highest priority items will fall to that man that you just heard from. They will. Kayla, thank you. Kayla tausche in washington. Now to Steve Liesman for the latest fed speak this afternoon at an economic conference here in new york. And maybe a momentous moment here, is that redundant, steve . Yeah, i think kelly, thats the way to put it. A momentous speech by the fed chair and a remarkable market reaction. The fed chair saying pretty much theres going to be a rate hike in march and im at the boost School University of chicago Monetary Policy and people dont remember that kind of explicit talk from a fed chair. The fed chair did say if the fed evaluates that, the economy is going along the way, they think and they do think that. She affirmed her belief in three rate hikes this year and heres what she said at a speech earlier today. At our meeting later this month, the committee will evaluate whether employment and inflation are continuing to evolve in line with our expectations, in which case, a further adjustment of the federal funds rate would likely be appropriate. Reporter there it is. Further adjustment means rate hike. Look at how the market reacted. The probability of a rate hike already high at 74 , jumped up to around 83, 84, i even saw it as high as 85 . There it is, 80 now. Came down just a little bit. And then you look at what happened to december. They did price in the december fed fund futures starting to price in the third hike, about halfway to pricing in a third hike this year, but the twoyear note and the market didnt react at all. Honestly, kelly, i didnt think i would get to this or we would ever get to this place where a fed chair could announce a hike in a couple weeks, three rate hikes this year and the market would say thats cool, bring it on. Kelly. Yes. Exactly right. Must have just been pretty much priced in here steve or theres still some doubt in investors minds about it, but well see what happens come march 15th. Right. Something we can ask Rick Santelli about in a moment here. Thanks, steve. See you later. Good stuff. Speaking of which, lets get to our Closing Bell Exchange for this friday. James bianco of bianco research, mark lehman from Jmp Securities in San Francisco, jonathan corepina of Meridian Equity Partners at post nine and we will talk with Rick Santelli lets start with you, rick. What did you think of the market response to the fed chair . The yield on the 10year has been hovering around 250, went to 251, now back to 2. 49. What did you think of how the market responded to what she said . Well, i think every observation steve made is right. I just think that hes given kudos to the wrong entity. Yes, the 2s, 10s, 30s, the stock market, no, its not a ba zillion points but its been hovering and its been hovering near unchanged. Steves right, but listen, janet yellen, i give them an a aplus, they took off the glasses and see the reality of the world behind them. They dont talk to us you need a decoder ring and they acknowledge what the market acknowledged months ago. Weve seen the stock market going with turbo thrusters. Have you seen rates go at turbo thrusters. No, you havent. Have you seen the dollar going thermo nuclear, you havent. Listen, you could say janet yellen threaded the needle but i say they were disrupted, disrupted by markets, by voters, by brexit, by trump, by the senate, and you know what, its a good thing. Im going to move on. It doesnt really matter anymore, i think the fed is doing the right thing and, of course, the economy can handle it. I think the economy could have handled it for a while. Were moving in a good direction and the markets are cooperating. Theres bad rates going up, good rates going up and good stock going up. I think at this point, were looking golden. Well, speaking of stock, jonathan, i was going to ask you, around this time for the last many trading sessions, we start to see stocks moving demun strably higher. We turned a little positive, but down a point. What do you think accounts for this . Is it etf lows . Theyve been huge into this market the first couple months of the year, possibly the biggest on record. Why does it seem like we keep, you know, opening the session week, building up, and then in the final hour, kind of seeing a very different tone . Right. So a perfect example is today. We come into todays session after snapchat yesterday and a small pullback yesterday, but todays session was all about what are we going to get from the fed and miss yellen. We were in the patiently waiting and seeing the information we were going to get. Clearly we didnt get anything that was really going to move or shake this market or derail it. I think investors take time to digest that information and then as we get towards the end of the day and especially a day like today, a friday, investors are thinking about next week, how do they position themselves accordingly for next week. And i think were going to continue to see this market move higher. A lot of Economic Data next week. We have the jobs number coming at the end next friday, and i think investors want to start to get ahead of it. In a session like today, yes, we started off low, moved a little bit, and as were getting towards the end of the day we will move high sore investors feel that theyre positioned accordingly. Jim, okay, the fed looks like theyre going to raise rates. How do you think the market will respond when they actually see this rate increase announced in a couple weeks . I think all things being equal, theyre going to respond with an unchanged. Because as of today and as of this week, the rate hike has been priced into the market. Now what we have to do is deliver it next week. The only thing that would upset that is if there was a severe stock Market Correction next week or a very bad payroll number a week from today, neither of which i expect, its going to be all systems go for rate hike along the lines of what rick said and real quickly about what steve said too, this is about the most forceful weve seen the fed talk in many, many years about a rate hike, if not 20 years. This is not just they set a rate hike. They set it with big exclamation points in terms of fed speak. Does that mean a bigger hike or something . Youre saying thats theres Something Else to read into that . I think theres Something Else to read into that, is not a bigger hike, not 50 basis points but an intense desire by the fed to start raising rates. In 2016 they were worried to raise rates if the market wasnt cooperating with them. What they seem to be saying in the last week to tep days is, were going to plow right ahead and were going to do this and thats something they havent done in 20 years, to say were going to raise rates and we dont care if the market prices it in and the market kind of followed them instead them following the market. Its a change. Mark lehman, turn to the stock of the week or year so far, with snap, the ipo, your company j and p securities was one of the comanagers of the ipo. What do you say to the skeptics who look at it . I think of the skeptics when facebook came out, when google came out, when twitter came out, and now theyre out again saying valuations are way too high. Youve seen sell recommendations from wall street. What do you make of all that . Yeah. It was a great launch, obviously, for snap, and more like you said, critics than people who think the price is supported by fundamentals. Theres not many ways to play the kind of explosive growth and online ads and not many ways to play that demographic. Snap is one of them. I think youre seeing participation in the equity there we havent seen in a while. The exposures to equities for the millennials and some of the people who have been out of the stock market. This was a harbinger of why the stock market is where you have to be exposed and i get it that there are valuations that seem very, very inflated but a way for people to be exposed. Morgan stanley did great job allocating the deal. We were thrilled to be a part of it. This is a company that has a chance to really garner like facebook and google already has, the Advertising Market in the infancy that will continue for the next five or ten years. All right. Gentlemen, thank you. Quite a week. Thanks for joining us with your thoughts on todays market action. And its not over. Send it over to seema mody for a market flash. The reits, they are under pressure here as rate hike forecasts move forward following Janet Yellens latest commentary at that executive club in chicago. Were looking at the fourth day of losses for the vnq, the vanguard reit index fund. Take a look at some of the Real Estate Investment trusts that are under pressure, equity president ial, udr, avalon bay and essex property. The S P Real Estate sector the worst performing sector in todays trade. Kelly . Again, the tough debut for the newest sector of the s p 500 last year. We need something to pair up with it. 11 sectors now. We need a 12th. I like symmetry. Mike suggested commercial staples. We were talking about maybe cisco or something. Sure. Hes on to something there. Thank you. 45 minutes to go. Dow down 4 points. We will watch this hour to see how the price action looks. The nasdaq turned positive, s p 500 down a point and a half and the russell down five. Snap, the biggest ipo since alibaba and shares are adding to yesterdays 44 gain. Were going to talk about the instant messaging act has surged too far too fast. Theres the skepticism. Trump economics could fuel the increase in Airline Stocks today. The details with the sector up 2 to 3 . Youre watching cnbc, first in Business Worldwide. Is happening before our eyes. Shift in Human History sixty to seventy Million People are moving to cities every year. At pgim we help investors see the implications of long term megatrends like the prime time of urban expansion, pinpointing opportunities to capture alpha in real estate, infrastructure and emerging markets. Partner with pgim the Global Investment management businesses of prudential. This car is traveling over 200 miles per hour. To win, every millisecond matters. Both on the track and thousands of miles away. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. Welcome back. We can call it trump economics. Driving gains in Airline Stocks today. United up 3 . Phil lebeau, what is happening . This is due to a report, actually that came out yesterday, that the Trump Administration is reconsidering a couple rules, regulations that are in the proposal stage. In other words, they were pre posed by the Previous Administration back in october, essentially looking at airfare regulations. The d. O. T. Has suspended the Comment Period for those proposed regulations and were talking about two right now. One would effect how airfares are marketed on competing websites. Airlines have said for some time, look, this is going to be a logistical nightmare, it will drive up costs in terms of making sure that all of the airfares and data matches from all of the different websites, and also, the disclosure of ancillary fees ahead of ticketing. Your baggage fees, change reservation fees, all of that would have to be disclosed in addition to saying look want to fly here to there, its 198. Take a look at shares of the airline index, the thing to keep in mind here theres just a few weeks ago i was at the white house when the airline ceos were there and they made it clear, they want less regulation. Thats what theyre likely seeing the beginning of here with the d. O. T. And this suspension of the Comment Period regarding these two proposed rules. All right. So lets just be clear, this is a very nuanced story. These are the regulations proposed put in place by the obama administration, but they have yet to be implemented. Correct. We havent seen these as consumers as travelers, and all the Trump Administration is doing is just ending the Comment Period. Correct. They havent eliminated the ruling the rules they havent eliminated the proposal. But be clear here, bill, the airlines do not like the proposals. Sure. Connect the dots here. We know whats going on. I wouldnt be surprised at some point the d. O. T. Says we had a chance to look at tis further and we dont think this is a good move. I wouldnt be surprised if that happens. Oh, yeah. I think that you dont end the comment if youre not expecting to get rid of it. Were talking about regulations, the fuel economy standards, weve talked about this some time, which is biggy. The automakers have to get up to 54. 5 miles per gallon by 2025 there are reports coming out within the last few minutes out of washington that next week, the Trump Administration might say, lets reevaluate whether or not we want to change those rules in terms of 2022 to 2025. So it is all all the stuff we talked about as far as changing those regulations that drive up costs for businesses and this is one that has had had a huge impact on the Auto Industry. This could be such a fill up for the Auto Industry almost makes all of the attacks on where theyre making cars seem worth it, right. They are making small cars to comply with the rule that nobody wants to buy. Wouldnt this do great if it allows them to focus on the business of making automobiles that the public wants to buy . Thats sort of a misnomer in terms of yes, way back, during the recession, when there was a huge drop in large automobile sales and large suv sales because of high gas prices, there was not enough small cars being made. What youre going to see here, is the automakers saying, okay, lets bring down those regulations. The problem is theyve invested in a lot of technology, both in terms of the standard engine making it more fuel efficient and a lot of that technology is scheduled to come in over the next few years. Do you cap it at 48 miles per hour, throwing out a hypothetical, instead of 54. 5. Its not going to change the vehicles being made. We are a big car country. Indeed. Thanks, phil. See you later. You bet. 40 minutes left in the trading session here. Pretty volatile week without saying but going out on a quiet note. The dow up just 2 points. But its up. Yes. You can see the intraday chart we were weaker earlier in the session and its up even after janet yellen is basically saying were going to hike rates again. Snap is rising again in the wake of 44 gains yesterday. Well discuss how high the instant messaging stock app could go next and making blue collar jobs cool again. Mike row, he will tell us why its important to close the skills gap, coming up. Uh, yeah. Its over, larry. What is . The whole wheelie thing. What do you mean . I just got this baby to get around the plant floor. Right, but now Ge Technology monitors every machine. Yeah, it brings massive amounts of information right to you. So you dont need that. Well, it makes me look young and uh. With it. Time to move on. Oh ill move on. Right into the future. Backwards. Youre going backwards. The futures all around us not just on your little tablet, my friend. Vice president mike pence made comments about the bill to replace obama care thats been controversy on capitol hill. Kayla tausche what do you say . Hes making the rounds in jamesville, wisconsin, asked specifically about the timing of a fourthcoming Health Care Bill and heres what the Vice President said. When can we expect to see the bills . Coming soon. By the end of the month . I just i have to tell you, im very grateful to speaker ryan and leader mcconnell for the hard work that dr. Price is doing in his new role and we expect in a matter of days, youre going to begin to see a very brisk pace of legislative activity. Were going to repeal and replace obama care at the same time and as i said today here in jamesville were going to replace obama care with the kind of solutions that will lower the cost of Health Insurance for every american, that will be an orderly transition to a new and Better Health care program, and were going to ensure that we dont leave anyone behind and that we give states the resources and the flexibility to meet the needs of the most vulnerable. Were working in collaboration with speaker ryan, leader mcconnell, members of the house and senate and the American People will see. President trump said this week, congress is responding and we look forward to ending obama care, but ushering in at the same time, a Health Care System that will serve the needs of the American People in the long term. Reporter that was Vice President mike pence in jamesville, wisconsin, the hometown of speaker of the house paul ryan, flanking the Vice President with congress out of session today. Guys, we were on the hill yesterday and spoke to some republicans coming out of a house conference meeting, a closeddoor meeting, and they said the plan is to introduce the bill early next week, submit it for mark up around wednesday, the committees will have their way with the bill and well see what happens from there. Well see we get it on time next week and we will see exactly whether the republicans can overcome some of the resistance in the party over some of the very specific details, the ways and Means Committee is working through the weekend to see if they can reach a compromise there. Yeah. A lot of work still to be done. Good stuff, thank you. Talk to you later. We have other breaking news this afternoon. This about a potential another potential scandal regarding uber. The New York Times reporting uber has utilized a program for several years to deceive Law Enforcement officials and cities with the Ride Sharing Service was outlawed. Uber sent cnbc this statement that says this program denies ride requests to fraudulent users who are violating our terms of service, whether thats people looking to physically harm drivers, disrupt our operations or opponents who collude with officials on secret mike from the New York Times welcome, certain. Thanks for having me. So lets back up for a second so people know what were talking about. This is a program called gray ball, which in the description that you have in the story here, makes it so that if im a cop in a city where uber is not allowed in portland is your example here i believe and i tried to hail uber, as of a couple years ago, i would be gray balled because they knew i was a cop and get ghost cars on my app that werent real ones, is that right . Yeah. So essentially they set up the program in 2014 2015, when a lot of the cities that now uber is legal in, didnt really have a framework for uber, the lowcost programs. So Code Enforcement officers and in some cases Law Enforcement officers would set up a sting operations in order to catch drivers operating the city would say illegally, uber would contend that they were operating within the bounds of the law, and essentially tag them or gray ball them and be able to evade them afterwards. Whether that was sending them a fake version of the app or blocking them entirely. Right. Or just yeah, it was it was pretty crafty. Lets revisit the comment the statement from uber where they say, they admit that they were trying to avoid officials be who collude meant to entrap drivers. They admit this is what this is all about. It comes down to the issue of whether theyre operating illegally in cities where they have been prohibited from operating, right . Yeah. I think ubers point here is that they used these tactics for a number of different purposes and my sources, you know, confirm this too. There are countries in which they operate now in which drivers are under attack from taxicab companies or other people who dont want uber there, and so uber would use some of these tools to ob vi skate their location and keep the driver safe. Thats fair. What i found is that the other sort of branch of how they used gray balling, was to evade, code Law Enforcement, and that was something they did systemically and printed up a playbook and distributed it to general managers in dozens of cities all over the world. So this was not just an incident isolated to portland and a handful of officers they were aware of. Youre saying if i was a cop or code enforcer and one of many cities, maybe las vegas, where uber wasnt allowed, most likely if i tried to use this, is it the case maybe even personally, would the app basically not work for me . So, if you if they ended up gray balling you, the thing is, they didnt want to outright ban Code Enforcement officers or Police Officers because they didnt learn anything else if they banned you from using the service. So, keeping you in, seeing how many times you opened the app and what devices you were using to access the app, actually helped uber learn more about Code Enforcement officers tactics or lyft and their competitors tactics or taxicab companies and their tactics. They learned more from keeping you on the app. All right. So lets take it to the next step then, mike. What next . Are we likely to hear from prosecutors in various cities willing to prosecute them for the use of this app . This device . Yeah. Its really hard to tell, just because this happened two years ago. They still say that theyre using it mostly outside of the country to protect drivers safety, but i talked to a lawyer when i was reporting this out and there are questions of whether they were obstructing justice in order to sort of escape Code Enforcement officers or not. Or if they were breaking any other potential laws, federal laws, versus state laws. So its really a matter of whether prosecutors in these states or at a federal level want to pursue it. Well, it has been a difficult week for uber already. To say the least. Mike from the New York Times thank you for joining us. Thanks, mike. Thanks for having me. Coming up next hour, we will hear from uber board member Arianna Huffington and her reaction to the story and all thats plaguing uber at the moment. Oh, boy. Lot of stuff going on there. Time for a cnbc news update now. Out to sue herera. Hi. Heres whats happening at this hour. Libyas coast guard rescuing a boat carrying 115 migrants near tripoli. The migrants said there had originally been 140 people on board. The survivors were taken to the Tripoli Naval base for medical care. A north korea man suspected to be involved in the assassination of kim jongnam, the half brother of north koreas ruler, has been released from malaysian custody and brought to beijing. He is black listed from entering malaysia according to officials. Arnold schwarzenegger is quitting nbcs celebrity apprentice. The former california governor blaming the shows poor ratings on President Trumps continual involvement in the show, which he says is turning people off. And 3d printing abscess core, printing out a 400 square foot home, in just 24 hours. Its located in russia. The house only cost about 10,000 to complete. It includes a hallway, a bathroom, living room, and a kitchen. Thats really cool. Thats it for me. I will see you next hour. But sue, who do you think im thinking mark cuban. Maybe. The new maybe. Yeah. Thats a really good guess. Although, you know, i dont know. I dont know. The president seems to be the president i think will continue to be involved. Yes. In this own way with that show, so it will be very interesting to see the dynamic with whoever the new host is. I wanted to watch the 3d printer make the house more. Its so cool, right. You got it. See you later on the business report. They keep inviting me back. I know. Back tonight. Together again. Im thrilled. I will see you on nbr in a little bit. 30 minutes left here. Were going out with a gain right now. The dow is up 8. 5 points, the s p up a fraction and the nasdaq up 4. That russell, thats spoiling the party right now. I know. Hes always like that. Bringing the cool factor into dirty jobs. Mike row tells us why he thinks this is a necessary condition in order for the president to make America Great again, coming up. Guys, whats happening here . Hey nicole, this is my new alert system for whenever anything happens in the market. Kids a natural. But thinkorswim already lets you create custom alerts for all the things that are important to you. Shhh. Alerts on anything at all . Not only that, you can act on that opportunity with just one tap right from the alert. Wow, i guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at Td Ameritrade. Bp engineers use underwater robots, so they can keep watch over operations below the sea, even from thousands of feet above. Because safety is never being satisfied. And always working to be better. Welcome back. Snap is surging again after a 44 jump on its market debut here yesterday. Its up about 11 , up 20 this morning. Right. Bob has. Tracking the action all day. The important thing is another new high today. Were off of that at 27. Went public at 27 but we went up to 29 earlier in the day. Its come off of that. Look at the volume here, 150 million shares, its been titanic the last few days. Nbc universal, our Parent Company announced an investment of 500 million in snap as part of the ipo. Take a look here. The important thing is they sold 200 million shares to the public, shares locked up one year, the company said 50 million. Nbc universal is a part of that. A good part of the shares that were sold to the public arent trading because theyve essentially been locked up. Theres only a smaller number of shares, about 150 million out there, to trade. So big volume here. Look what happened. They slowed at 200 million shares. Yesterday 217 million floated. The important thing any time you trade the whole float thats a big, big number. Today we might get close. Were doing 150 million right now. The bottom line here, guys, is theres only a relatively small number of shares out there thats trading here. Remember, bill, Johnny Carson used to say, theres only six fruitcakes in the world we keep passing around. Only a few million shares of snap and everyone keeps passing it around. Keep changing hands. Thats for sure. Thank you. Our next guest says if we want to make America Great again we have to make dirty jobs cool again and this is something hes very familiar with. Mike rowe, testified before Congress Earlier this week, about the bias against millions of skilled jobs in america and the Economic Impact of those Unfilled Positions and joining us now is mike rowe, the host of the popular reality tv series dirty jobs. Welcome. Welcome back, michael. How are you guys . Good to see you. So what is the point you most wanted to emphasize in your point before congress here . Same point i wanted to emphasize in 2011 and 2013, when they invite med there to testify in front of various committees. The basic point was brought home last week when the president met with the ceos of Manufacturing Companies and we heard the same thing weve been hearing, which is, you know, a real emphasis on bringing jobs back and creating new opportunities which, of course, is great, but when it comes to the skills gap, we get a kind of disconnect and i was kind of relieved, personally, to see some of those ceos say to the president , look, its great, to create more opportunity, but the truth is, there are 5. 6 million jobs right now that exist, many of which fall under our pursview and we cannet fin the skilled workers to fill them. Right. The president during his speech to congress on tuesday night talked about this meritbased immigration plan they would like to implement, Something Like what they do in canada and australia, where they only allow for the most part, highly skilled, highly educated immigrants into the country who can easily assimilate into that country by making contributions, presumably with these highskilled jobs. What do you think about that . Probably a bit beyond my pay grade but the more fundamental conversation is, do we or dont we, as a country, aspire to the opportunities that currently exist. Now if we dont aspire to those opportunities, if parents and Guidance Counselors and big business arent uniformally committed to uplifting the status and confronting the stigmas and stereotypes that keep people out of those jobs, were just talking past each other. If the solution is some sort of immigration plan that youre talking about, okay. But i think youre under selling yourself. I mean what youre talking about are a lot of times the jobs that people dont want and, you know, the critics of immigration often say, that people coming into the country are unskilled and theyre taking up the jobs that some of our young people would want, whether its in fast food or aggri culture or whatever it is, you could argue that point or the dirty jobs youve done on television for years, and these people often cost us money because they have no health care and its an expensive proposition. You bring in the highly skilled workers and they pay their own way because they are already highly educated and highly skilled. Youre talking about two constituencies here. Letting the unskilled workers in to try to find their way in this country, doing those open jobs youre talking about, or the highly skilled workers only, to do these jobs in Silicon Valley behind you there or whatever. What do you think . Im actually suggesting, with respect, bill, its a false choice. Theres a third choice thats real. My foundation has probably trained 300 welders. I would say 30 of them now are making north of six figures. Is welding a highly skilled job or is it a nonskilled job . Is it a good job or bad job . Clean job or dirty job . This is the bait we always take. We always wind up talking about Higher Education versus alternative education. The truth is, theres a huge misunderstanding about the opportunities themselves that exist in those 5. 6 million existing jobs right now. Its the reason the jobs exist in the first place that, to me, is the foundation for the conversation that we ought to be having. Why arent more people excited about a sixfigure job that can result from getting yourself a welding certification. Quickly, mike, on that point, so the biggest problem for the labor market right now is the people who arent in the labor force and if a lot of them appear to be young men, for example, is what youre talking about is that going to get them back in . Who knows. But pr matters, right, and the way we celebrate work or the way we demean certain opportunities, its critical. We get to decide in 2017 the definition of a good job. Of all the things we cant control, one of the things we can, is the kind of work we promote. The skills gap isnt a mystery. Its a reflection of what we value. So, too, is 1. 3 trillion dollars of student loans. If we insist on lending money we dont have to kids who cant pay it back to train for jobs that dont exist anymore, were going to stay where we are right now. All right. Rather have the welders. Yep. Thanks, mike. The man with the greatest set of pipes in broadcasting. If only i had something to say, bill. Mike, thanks. As always. Thank you. Any time, guys. Thanks. About 18 minutes to go into the close. Dow up 10 points. S p up 1. 5, the nasdaq up 7, russell down about 1. 5. Costco stock down after a disappointing earnings and news it increased its membership fees. Time to get out of the big box or in . A bull bear debate on costco coming up. Costco stock down after a welcome back. Shares of costco are lower today, down 4 , after the Company Announced it will hike membership fees in june. Lets talk about whether this pullback in the stock is a buying opportunity or not. A bull and bear, our bull is youre are you the bull or bear. Bull. I thought so. From oppenheimer. Liz dunn is our bear. Brian, ive heard costco is an unusual situation being a club membership. Three quarters of their operating income comes from their membership fees. Those are going up. Isnt that a good thing . Its a Huge Positive in my eye. When i look at the costco pnl, the fact like you said, bill, almost three quarters of the profit basically an annuity, i think thats a positive in the investment story. So liz, why are you skeptical and people have been selling shares off today as well and had earnings a miss on the bottom line. There was an earnings miss, the quarter was sloppy and most people called it out as being such. On the membership fee increase, that was largely expected. They do this every five or six years and it was already in the stock. What do we have walking into today . We had an event that was expected, which happened, but there are going to be reinvesting that in price and in other, you know, services to solve that last mile. Doesnt that insulate them from the troubles that are plaguing retail otherwise today . They have a Better Business model than many other retailers, i dont agree with the assertion this is an amazonproof model. You see it at the margin begin and a lot of price competition in grocery and a lot of price competition in terms of how to solve that last mile for your omni channel business and there are ways theyre having to compete with amazon despite the fact that maybe they have more insulation than others. Brian, is there space for two membership clubs . Absolutely. You know, look, i agree with liz. Theres nothing out there thats amazonproof. I think its all a game of relativity. I think costco, given the merchandising, given the power they have with consumers are much more insulated from amazon than others. Nothing is amazonproof. Buying the dip . Absolutely. And how much lower does the price have to go for you to be interested then . Sthi dont have a price target and but i would say a 10 pullback versus the 4 might be more interesting. How high do you think it could go . Mid 20s multiple and look a few years out, dealing with 7 or 8 of earnings. Higher from here. Brian, thank you for joining us. Thank you. We have 12 minutes to go. Dow is lower, down 8 points. Transports up 36, held by the airlines today. Dollar interestingly is weaker by almost a point. How much . When they were talking about fed rate. And the possibility of three this year. I got it all right there. We will have the buy and sell, the market on close orders in a moment. Gold having its worst week since november, but our next guest likes the shiny metal as an investment opportunity. We will talk about that when we come back. Switch to directv and lock in your price for 2 years. New offers starting at 25 mo when you have the new at t unlimited plus plan. Wont replace the full value of your totaled new car. The guy says you picked the wrong insurance plan. No, i picked the wrong insurance company. With Liberty Mutual new car replacement™, you wont have to worry about replacing your car because youll get the full value back including depreciation. And if you have more than one Liberty Mutual policy, you qualify for a multipolicy discount, saving you money on your car and home coverage. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. Lower than Td Ameritrade and etrade. You realize the smartest investing idea, isnt just what you invest in, but who you invest with. Maybe you heard him off camera when we were talking about costco a while ago. Art cashin pointing out the market on close orders showing an imbalance to the sell side of 500 million. Taking a little edge off here, putting us back in negative territory back below 21,000 on the dow. Thats true. Joining us now, david, president of tice capital out of dallas, and the chief Market Strategist at ab is with us from 30 rock. Vadeem, you think markets over is overvalued, very expensive, does that mean youre not buying, would you sell at this point . It depends on which market. U. S. Market still has room to run through the middle of the year. I think as you look toward the end of the year, theres going to be a war between the multiple compression and Earnings Growth and i think market could end below where it is today as we get to the end of the year. David, meantime people have looked at bitcoin above gold in terms of valuation and looks like you kind of would be a buyer of both here. Yes, i am. Really a big believer in gold, silver and especially gold and silver stocks. I really think they represent a gift here. We had such a big decline from 2011. At lot of the stocks lost 80 to 90 of the value and we had a nice rally in 2016 and the first half, a selloff in the second half, now for 17, we think gold stocks are going to be up a lot and also the bullion and silver. But, david, heres a scenario that the bears are going to point to on gold, if rates are going to rise, the fed talking about raising rates at the end of the month, that presumably pushes rates up, the dollar up, it lessens inflationary implications, and that should depress gold prices even further. What do you say to them . All right. So theres three or four factors here, bill. One, the fed raised rates in february of last year and gold still took off at the first half. Inflation rates are picking up in january, both europe, china and the u. S. Three, the dollar can still be relatively strong and gold and bitcoin can both beat it. Dollar could be number two or number three. And actually, tlarts has a constituency against overvaluation. Trump has already talked about he doesnt want the dollar to be that much stronger. Gold does not have a constituency that cares when gold goes up. So gold can still do very well, even with a relatively strong dollar. Let me ask you whether rate hikes are good for the market . Well, if you look at history, when youre coming off a low level of Interest Rates, rate hikes have generally been associated with rising markets. What makes the current environment a little trickier, is you already are starting with a point where youre fairly late in the cycle. So as you approach the latest stages in the cycle, generally rate hikes are not particularly positive. Which is why i think as you move toward the middle of the year, the more attractive trade would be to move outside of u. S. Into europe and actually start to scale back u. S. Exposure. All right. I got to go, but david, im curious, what is the catalyst that moves gold higher if its not the inflationary implications of generous Monetary Policy in the past . One, you have europe falling apart, the prospect of china falling apart and people getting money out of china. Those are a couple factors right there and then the paper versus physical dilemma that is too long to talk about that will cause gold to go up. All right. David, and vadeem, thank you. Appreciate it very much. The dow down 2 points. The closing countdown to wrap the week you. After the bell, imax is becoming a multiplatform experience entering the world of tv and visual reality. Richard gelfond explains the strategy to us. Youre watching cnbc first in Business Worldwide. Created, as a benchmark for average. Yet a lot of people still ild portfolios with strategies that just track the benchmarks. But investing isnt about achieving avere. 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We had the end of the streak where we had 12 consecutive up days for the dow end on tuesday, then wednesday after the president s speech it just took off, and were finishing the week, the day flat but positive for the week overall. 10year yield this is now the time where the markets are realizing the fed is likely, very much so, to raise rates when they meet on march 14th and march 15th so the yields are getting back to levels we saw at the beginning of the year. Were back to a high of around february 15th. Wti, volatile week, but guess what, kids, were still stuck in a trading range as they try to figure out the buy and sell, the supply and demand equation, between opec and u. S. Producers. Were going out at 53 and change. One of the worst weeks for gold in quite a while as we talk about and david just with us saying this is a time he would be buying the precious metal right now, he thinks these levels are a gift for investors in metals like gold and even silver too. Markets will go higher, even Gold Investors know gold isnt the place to be necessarily. I think this is a remarkable day and janet yellen, were in a new phase for fed policy. Heres the sentence that everybody went whoa. The economy has essentially met the employment portion over mandate and inflation is moving closer to our 2 objective. In other words, shes saying, weve done it, folks. We met our goals. Right. How ive never heard her make that statement before. They will be more aggressive this year raising rates than in the last couple years. Three she said. How ironic the markets take it in stride. Theyve prepped the markets for months, particularly after her congressional testimony, everybody got a lot more aggressive and the markets did not react and i think remember this would have happened a year ago anything close to this, the dow would have been down 200 points immediately. Its a remarkable turnaround. She can thank the global reflation thats occurred and the trump rally helping her out. We have fiscal stimulus. The president has essentially an alley of hers, no friend, but definitely helping out her case at this point. Thanks very much. Were going out with minus signs not terrible. The s p is positive as we finish this trading week. Pretty volatile as well. Stay stay tuned for the second hour of closing bell with kelly evan and company. Have a good weekend, kelly. Thank you bill. Welcome to the closing bell. Im kelly evans. Heres how were finishing up on wall street. The dow going out not with a gain but almost there. Slight drop of a point. See if that changes as things settle out. Leaves us with 20,100 just by about that point. Now the s p 500, managed to gain a little bit less than a point on the close, the nasdaq was slightly more positive up 0. 1 , to 5870 the russell 2,000 no remember near it, 1393. A mixed session overall to close out what has been a banner week when the dow did close above 21,000 for the first time we had the 300point rally on wednesday. Commerce secretary wilbur ross joining squawk box for his first interview since officially joining the administration. He tackles everything from nafta to the peso and export import bank. Larry kudlow weigh this is on what the secretary had to say and how trade is shaping up so far under the president. Now joining me on the panel today we have cnbcs senior markets commentator and pro columnist michael santoli, resident bob dillon of newmark and cnbc fast money trader guy adomi. Great to have everybody on board here. Mike, maybe people dont want to be short going into the weekend . It could be that. I mean there was a little bit of a gravitational pull all day look at the s p 500 at 2380. Why does it matter . If it matters. That is where we opened on wednesday. Basically kind of soared into the opening on wednesday after the speech tuesday night and after the fed expectations and then you ran further up during the day. Thats been left behind. Those gains are set aside. I think the market is regrouping, figuring out exactly you have buyers at this level, the tape is stretched, everyone kind of knows that, but it was a mild test for the dip buyers. People have been saying they love to buy, basically about a 1 down. I feel like i want to rewind 48 hours and see what you would have thought when we were up 300 points over 21,000 in the tied for the shortest period of time weve climbed from one round number to the in ex. Almost feels like it happened before we had a chance to realize it. Yeah. Im sorry i wasnt here to watch you go with another record close. But, you know, whats going on right now, i think is a couple dynamics. I dont know if theres a lot of technical background. This is like a feelgood market. One is, a lot of active Money Managers and Hedge Fund People are going its the beginning of march and im 200 basis points behind where i need to be to get a bonus this year. Yeah. And how did i screw it up this year already. And i better be in this market because if it goes higher and im behind another year without a bonus. You mentioned this. The narrative in part has been, oh, look at the retail money, the etf fund flows but youre saying in some ways like a chance by the chase by the pros here. The element of the Retail Investors im sure, you know, they watch you, they watch Something Like the snap ipo, and theyre like, you know, its coming up to when their 401 k money has to be in the ira money has to be put in and theyre like, you know, if not now, when, if not me, who. If not whatever. But i think theres generally a feelgood thing right now and i think trumps speech was part of the feelgood element. And the one thing i would point out again, is that the bond market doesnt buy it. The bond the bond market is what we very flat right now. Yeah. And lets show if we can the ii maybe the 10year and 30year. If its flat it means the people buying the long end of the bond market dont believe in 3 plus percent growth. But its there. Its still it has flattened. The 2 year is a sevenyear high. The 30year over 3 . But its since the trump election, its basically been right around here. It hasnt really moved up or down very much from this level. I think if you start if you start seeing the 30year at around 3. 25, 3. 50 you go oh, yeah, the market, the bond market, beliefs in the reflation trade. Until that happens, though, the bond market is not buying it. Because you think guy. Hi. If theres a risk wait a second. Before you even ask me anything, i havent been around in a while. Why is evan bob dillon, does he mumble in incoherent sentences . Thats part of it. Guy, we cant do this on the screen right now other than i shared a video with kelly which was me performing live at some bar. Come on. Yeah. Thats true. I got to put that on the snapchat, man, get that out there. It will not be on any form of social media. Its very good. I think he should invite everybody, guy, you included, to the next recital. Im in. I was going to ask you about whats happening in the bonds, because theres some worries we could have some kind of stagflation thing going on, growth isnt there but inflation is. Yet, like to evans point, thats not what the 30year is telling us, it seems more concerned were not going to get the growth, period. Think about it. When yields, this is going back a ways, over the summer when yields were getting crushed and i thought the yields were trying to tell you something in terms of what would happen in the equity market, turns out they werent telling you anything. The equity market was full speed ahead and still seems but for yesterday, still seems to be full speed ahead. My concern would be, im not an economist, but will the fed, can they hike us into a more flattening yield curve . Could they sort of mess this thing up on their own . Clearly theyre behind the curve. Well see if theres a move in the back end to what evan was just talking about. That would be my concern. The other kidnapper nobody seems to be the other concern nobody seems to be talking about the debt ceiling coming up on the 15th or 16th of march which, again, its going to its going to be here before you know it, and nobody seems to be doing it any lip service whatsoever. So with that said, think about it. Even with the market getting banged up yesterday, the vix didnt move. As a matter of fact, i think the vix went lower yesterday. So there seems to be a lack of concern about the health and the age of this bull market. As a matter of fact, as things shook out here on the close, the dow did turn positive by a couple points there. It is another close higher. You did actually, to guys point about the vix going lower, goldman had a big note, everyone circulated it today, saying big institutional money is as unhedged as its been in almost two years. Is that surprising when you get to the highs but the demand for Downside Protection has not been that strong. Can i just echo Something Real quick. Hate to jump but its weve been saying for a while, think about it this way. Everybodys been trying to be smart for the last couple years to buy Downside Protection for a market they thought was going to sell off. You want to buy insurance, want to buy assurance. Its the right thing to do. Im not questioning it. As months go by and this insurance policies continue to expire worthless, which by the way, you should want, i think people are now saying, why am i spending this money when all the market does is go higher, which i think is the essence of goldmans note, which by the way, is actually a pretty scary thing. All right. Lets pause for a moment and send it over to seema mody who has a market flash for us. Deutsch bank, the german banking bank excuse me looking at a potential Capital Increase of 8 billion euros or 8. 5 billion. The bank coming several strategic measures including retaining its postbank unit and integrating it with other german Retail Business as well as a sale of a Minority Stake in its Asset Management business through an initial public offering. All subject to market conditions. We should point out, shares did close at session lows, down around 4 . But this is a stock that has come back a lot since september of last year, actually doubled its market value, kelly. Thank you. You know, its got to do something to kind of shore things up, deutsch. This would suggest this is somewhat priced in, but what do you make of it. Somewhat priced in after the move to the upside as seema mentioned. The move to the downside before that, really put them on the back then it was a matter of wow, is it going to be 15 billion euros. Very big numbers being floated around when it was about the kind of u. S. Settlement they were going to have to sign on to. Lets bring in our Steve Liesman here. Speaking about the fed, fed chair janet yellen saying be prepared for a possible rate hike later this month. Steve has more for us now. Yeah. Kelly, thanks very much. A pretty extraordinary speech by the fed chair laying out very x exitly there will explicitly there will be a rate hike in march if things go as she thinks they will. Heres what got the markets attention. At our meeting later this month, the committee will evaluate whether employment and inflation are continuing to evolve in line with our expectations, in which case a further adjustment of the federal funds rate would likely be appropriate. Heres what else she said. She said there are three rate hixz coming this year, again if all things go as planned, the fed is nearing its employment inflation goals. The Global Economy is helping now rather than hurting as it has the past several years and stuck to her guns making no comment on trump policies throughout. Take a look at what happened to the fed funds probability chart. Started around the 73, 74 range and now its running around bumped up to 85, now around 80 . All but a done deal, guys, depending on what happens with that jobs report next friday which would have to be extraordinarily weak. And i am at the school u. S. Monetary policy conference which is kind of like the jackson hole except its in march and theres not mountains behind me but a big long lobby and everybody here, kelly, was talking about just how explicit the fed chair was and how the market seemed to take it all in stride. You had a little bit of bump up in the dow at the end of the day after oscillating around the 0 line. The 10year was down a few basis points. The dollar sold off just a touch. You would expect opposite reactions in years past if a fed chair came out and made hawkish comments like that. A lot of talk here, kelly, about how the how explicit the fed chair was and how equally the market took it all. Its an excellent point but it has nothing on the mountains. Thank you for joining us. Steve liesman. Jim is joining the fray from hansman group. What do you think about the fact that the dollar was so much weaker today . Well, i just want to talk about janet yellen for a second because shes exactly like my grandmother. If i put on five pounds she notices and tells me right away. The most controversial thing ive said about yellen is you can actually listen to her and she says what she means. Were outside of the world where we would monitor sort of the size of Alan Greenspans briefcase to figure out if the fed would raise rates. Because shes tell graphing this so strongly to the market it allows the market to react and the dollar has reacted over the course of the last few days, strengthening. Today it sold off a little bit. But ultimately Interest Rate gaps between the u. S. , europe, japan are widening and we should expect a stronger dollar on a go forward basis. Do you agree with that . The other thing going on here sound likes all of a sudden the border adjustment tax might be going forward. We spoke with people this morning and if the idea is maybe its phased in over a long period of time so the revenue doesnt come right away but the increase to the deficit examines right away for the Corporate Tax, maybe that weakens the dollar. I dont know if thats part of what were seeing here. What we heard is something we need on paper to find a way to pretend theres going to be a trillion dollars coming. If the market believes its happening the dollar goes up i think. The interesting thing is, going to be over the next few months, the tug of war between steve ma new chin, gary cohn and donald trump, who dont give one hoot about the size of the deficit, who would happily issue 50 or 100 year bonds wilbur ross seemed to. But the republicans in congress who are not keen to do that. Theyre much more thats the tug of war in terms of trump policy making and i think that is what will have an effect on the fed within six or nine months time. So this is richs point this morning, the regan, you know, republicans who were deficit hawks that rhetoric is gone. The reagan republicans were not deficit hawks. They were never deficit hawks. The point is if thats certainly not the case today, whatever it was back in the 1980s, what does that mean . So like, as jim was telling us, he thinks fed raises rates dollar goes up. This would suggest the dollar goes down. Whats it going to be . I think it depends on who ends up steering the policy. My guess if gary and steve have their way, they will issue a lot of bonds, longer end of the curve, and stimulate the economy because trumps even actual reelection or a trump economy needs growth. If you dont get the growth thats the one the one way he fails as president is without economic growth. The other point when it comes to the market theres a catch 2 2. Hang on one second. I was just going to say the market having priced in march, is now moving based on what after march. The market has not said march is happening, therefore were getting three this year and three more next year. Theyve said march is happening, preserves flexibility for the rest of the year. If the market starts to believe its going to be 3 and we have to catch up as opposed to, you know, take our time, then maybe the dollar and bonds move more. And jim, what were you going to say . Yeah. I was saying that yellen and the Trump Administration are not on the same side of the table. If the Trump Administration tries to stimulate the economy she will stop that with higher rates because shes afraid of getting behind the curve. You dont say were not behind if youre not afraid of being behind. If he does get a stimulus, sort of issue these long bonds to stimulate the economy shes going to counter act that stimulus with higher Interest Rates to avoid inflation. Because fed governors dont want to be known as the one who let the lid off inflation and doesnt want to have that legacy. Shes handled the economy well so far and she will do everything she can to make sure inflation is controlled. I would say you got to look at that balance. Final word to me, right. Now thats where youre going. We have to wrap this block up. We are hershavy as can be. Youre talking about a president that is now publically talking about wanting a weaker dollar. I think his comment was, a stronger u. S. Dollar is killing us, im paraphrasing. Hes going back on 25, 30 years of a strong dollar policy. Whether he realizes it or not frankly, im not sure that he does, number one, number two, he has taken doing victory laps for the epic move in the stock market and good for him, but if we do see a selloff, wouldnt it be so easy for him to potentially blame a Federal Reserve . Cant you see a tweet saying, you know what, they waited all this time until i finally was elected to raise rates. Look at the crooked Federal Reserve, what they did to the stock market. Its their fault not mine. And off we go. Reading jims tweets . He was sort of channeling the president saying exactly this playing out. You are all on the same wave length. Look him up if you havent seen it. Im looking him up right now on the twitter machine. Thank you, guys. Very good to have you with us. Catch guy with the fast money crew with the technician who called the gold run, carter worth, telling the traders where prices are going next after the metals were weak since november. Snap shares surging for a second straight day after its red hot ipo. Well discuss whether snap could be the stock that finally lures millennials into the market next. Commerce secretary wilbur ross discussing the border tax and renegotiating nafta during his first interview since being confirmed. Well have larry kudlow weigh in on the impact. A report that says uber used technology to evade authorities in cities where it is band. Board member Arianna Huffington reacting to that charge later on the closing bell. Youre watching cnbc first in Business World wide. Across new york state, from long island to buffalo, from rochester to the hudson valley, from albany to utica, Creative Business incentives, infrastructure investment, university partnerships, and the lowest taxes in decades are creating a stronger economy and the right environment in new york state for business to thrive. Let us help grow your companys tomorrow today at esd. Ny. Gov another big game for snap after going public yesterday. But will this company thats so popular with millennials bring the generation into the stock market . Julia boorstin has that for us now. Julia . Kelly, millennials are addicted to snapchat. Users 24 and under spending an average of 30 minutes a day on the app. Many are checking out the stock. Robin hood, a stock trading out particular with millennials reports to the apprenticethat 43 who traded yesterday bought snap stock. The day before snaps ipo there were 54 more sales of Facebook Stock than the day before that on the app. Its not just robin hood seeing a surge here. Stockpile, a company that offers gift cards for stock purchases targeting teenagers and younger investors says transactions on stockpile yesterday were ten times their daily average and all because of snapchat. When we see something ipo like snapchat, that is certain lay way that millennials will be incentivized to start investing because its something they know and use and understand so they may be more comfortable doing a little bit of individual stock picking that way. We talked to one millennial who said he bought the stock because unlike twitter and facebook, snapchat keeps peoples eyes glued to the screen. Back over to you. Stay with us. My favorite was that she mentioned 43 of people using robin hood yesterday, in trading, were buying is snap shares. Terrifying. Its ter fiing. Listen, so take the worse Case Scenario, youre 21, put 1,000. Snap it goes to 0. Isnt it still in a weird way, thats probably the best thing that could happen to somebody whos interested in stock to lose money on your first big trade. So in a weird way, its not a bad tea trader or great investor its part of what happens how you learn about it is kind of you dont love it when people are taking flyers on a stock the value this way. People most likely using the robin hood app been in beta forever and trade for free are not trading every day. Its not like i trade every day and 43 did. They decided to trade because there was the stock big millennial crowd which is why its Young Millennials i point out, now turning 36 years old. Very old and creeky. But i think its one of the things that has to build into a wave for us to really generalize as to what the effect is going to be. Yeah. And that this by the way, our worse Case Scenario assuming its going to zero. I dont its, you know, peter lynch is peter lynch at fidelity his thing is buy things you know and all that but were in such a different universe with the stocks. The stocks he was saying did you read the journal interview, he was misquoted. Always skewed. Thank you, julia. Wilbur ross speaking out since being confirmed as commerce secretary and did it on cnbc. We will get Larry Kudlows reaction to what ross had to say about trumps trade agenda and the ceo of imax will join us to talk about his companys push into the world of vr. Were back in a moment. I work with people everywhere onea, on land, and in the air. Inspecting towers way up high avoiding turbulence in the sky. Personalizing treatments with dna and recommending who should play. A dress that thinks, which crops to grow, tax prep to help keep paymen low. You can find me on aoil rig i answer qstions small, and big. Hello, my name is watson. Hi, im ank. I take movtik r oic, opioidinduced constipation. Had a bad back injury, doctor prescribed opioids which helped with the chronic pain but backed me up bigtime. Tried prunes, laxatives, still constipated. Had to talk to my doctor. E sa, how long you been holding thisn . laughs that was my movantik moment. My doctor told me that movantik is specifically designed for oic and can help you go more often. Dontake movantik if you have a bowel blockage or history of th. Mova may cause serious side efcts, including symptoms of opioid withdrawal, sere stomach pain and or diarrhea, and tears in the stomach or intestine. Tell your doctor about any side effects d about medicis you take. Movantik may interact with them causing side effects. Why hold it in . Have your movantik moment. Talk to yo doctor about opioidinduced constipation. If youan afford your medication, astrazeneca may beble to help. Commerce secretary wilbur ross on squawk box talking trumps trade agenda and the future of nafta. As you know the first on our agenda is nafta, because we think it makes sense to solidify your own neighborhood first. I think the peso has fallen a lot, mainly because of the fear of what will happen with nafta. I believe that if we and the mexicans make a sensible trade agreement the mexican peso will recover quite a lot. And, in fact, the peso responding positively to the comments. Joining us is larry kudlow. So, theres what he said about nafta, also which we were already getting into, but he kind of brought up the deficit a lot. The trade deficit. Yeah. Maybe it was the trade deficit. My understanding it was the deficit and how we would pay for Corporate Tax reform too. Youre right on both counts. What he said on nafta and the mexican peso i think is quite sensible and agree 100 . Before i voice my disagreement with him on trade, i just want to say that wilbur ross and hillary are dear personal friends and i love them both. Talking about hillary ross . Hillary, but shes a great woman, threw a great book party, cant say enough good about them. We disagree on trade. And what i will say at the top is this, you can fix nafta, thats a good oneonone thing but i am strongly opposed to the border equalization tax and weve talked about that and theres no news there. I was glad to see that secretary ross said that President Trump has not made a decision on that. Glad to see that. I can also he did seem warmer to it. I can report that inside the white house, the weight of the argument is very much in favor of the border adjustable tax, so far as i can tell, only mr. Cohn and mnuchin, Steve Mnuchin and gary cohn are against it, and everybody else i call them the protectionist wing is for it. The president has not come out for it. I have heard in the last 24 hours, that theres some talk instead of a 20 tax on imports it might go to a 10 tax. You cant just be a little pregnant here. Its a terrible idea. Look, just one funny thing that they talk about. Exports, all right. I dont want an export driven economy. Thats industrial policy. I want a Market Driven economy. Its odd no one notices it. If you raise the bat or create a bat which raises the dollar by 20 or 25 , the feldstein argument, well, guys exports too. Traditional theory thats going to kill the expores youre trying to help. I dont want do any of it, but im just pointing out another contradiction in the story. I dont think we need it. Last point, the trillion dollars, the socalled pay, you tax imports like this, whatever, 20 , whatever, you are going to be taxing consumers, raising consumer prices, you are going to be weakening the economy and therefore, if you tax something more, youre going to get less of it and youll never see that socalled trillion dollars. Thats another contradiction here. And paul ryan, who is a supply sider, knows all about the curve, but just in case hes watching this afternoon, i want to remind him, if you tax something, you get less of it. And if you tax imports an consumers, youre going to get less growth and fewer revenues and youre not going to pay for anything. So just dont do it pass the Business Tax Reform. Pass it and get rid of the other thing. Youre preaching to the converted here. Most people that we speak with feel the same way as you do but say, we also want Corporate Tax reform. So just do it. In fact, do Corporate Tax reform, right away, in the first reconciliation package. By the way, another on this, obama care is a tax. Remember, judge roberts, thats how they got it through. 2012. Very big decision. It is a tax. Therefore, it fits into reconciliation and, therefore, if you repeal obama care, youre cutting taxes. If you get the tax reform, the Business Tax Reform message in the same reconciliation, it passes muster. You can do this. Just do it. Stop worrying about bean counting and start growing the economy at 4 per year for heaven sakes. Larry, look, it seems like anybody who felt as if Corporate Tax reform was the most important thing to get accomplished, would completely agree with you. But congress doesnt seem to is sort its own priorities that way and its kind of backed itself into a corner in terms of how its able to push things through, right. Obama care first, thats where the promises are, thats what they see as the first hurdle. If its not going to happen where does it leave this what is i wonder where does it leave the market. If Corporate Tax reform slid away from 2017 i dont think hearts are broken in most of the house of representatives. Is the rally broken . Hearts are broken in the stock market. Youre stock guys. Im not. Im saying you know theres a whole tax cut discount in there for future profits and so forth and so on. If you wait until the end of this year theyre saying august, when i hear august i say, december, january, february. But so ive been through the process. That will break the heart of a lot of investors. Whats interesting, is the dynamic because trump and some of his people have come out and said look at the stock market rally. Right. When you start doing that youre setting yourself up for something. Live by the sword you die by the sword. But take your win today and if you lose tomorrow blame somebody else. Larry, thank you. Its not going to work that way. You make your case, it seems so easy, maybe theyll get it done. Larry kudlow, thank you for being here. It may not. This bat may not happen and tax reform, theyve have a piece in the journal, very good, i have him on radio, we can still do this tax reform. Everybody should tune in to that. Thank you. Larry kudlow at post nine. Secretary ross weighing in on the future of the export import bank, speaking of trade, known for guaranteeing loans to huge companies. Its also playing a larger role in financing for smaller businesses. Kate rogers explores that for us. Hey there, kelly. While the white houses formal position on the bank is unclear secretary ross did express the importance of having a form of aid to finance exports in the cnbc exclusive this morning. Finance is clearly one of the mechanisms for international competition, so maybe there are some things that could be fixed, maybe a different mechanism is needed, but we need something to deal with that. What i hope, whatever comes out of it will do, is to help Small Businesses more. Right now, the bank lacks the board seats needed to approve larger loans so Small Companies are actually getting a bigger percentage of its funding. Now in 2015, the bank authorized 12. 3 billion to support 17 billion ins u. S. Exports, about a quarter of that or 3 billion went to Small Businesses. Now, if you compare that to 2016, when the bank authorized 5 billion in deals to support 8 billion in u. S. Exports, a much lower financing amount but more than half of that, 2. 67 billion went to smaller companies. While the bank has often come under fire for making and guaranteeing loans and providing insurance to Corporate Giants like ge and boeing it helps Small Businesses assume less risk when doing business overseas. Concerns over payment is one of the Biggest Barriers to entry for smaller exporters. Why does that matter . In 2015 about 98 of the nearly 293,000 businesses that exported goods from the u. S. Were Small Companies, kelly, with fewer than 500 employees. Back over to you. I had no idea. Kate, great reporting. Thank you for telling us about it, cate rogers with the impact on small business. News alert on chipotle. Whats happening . Shares of chipotle lower here in extended trade. As chipotle files for a secondary offering. The potential offering of 2. 9 million shares by selling shareholders and it seems to me Pershing Square according to the latest filing looking at chipotle shares down about 1 . Again, Pershing Square the seller here. Back to you. All right. Not a huge move on an expensive move. Thank you. Time for a cnbc news update. Over to sue herera. Hi, kelly. Heres whats happening this hour, everyone. The Trump Administration is reportedly considering separating women and children crossing together illegally into the u. S. Thats a new proposal being considered by the department of homeland security. According to government officials. This is partly to discourage mothers from migrating with their children. Former haitian president rene pureval has died, the only democratically elect the president in the countrys history to win, serve a full term and peacefully hand over power to a successor. He was 74 years old. A soy nut butter is being recalled after linked to an e. Coli outbreak. The product believed to be the source of the outbreak is called i am healthy brands soy nut butter. A dozen people, mostly children, have been affected so far and six people have been hospitalized. A campaign in france gaining some steam urging former u. S. President barack obama to join the french president ial race. An online petition already has 45,000 signatures. With hopes of reaching 1 million by the end of march. The former president , however, as we know, is not french so he would not be able to take part in the race. I dont know, i would like to see the birth certificate. Lets not bring that all up again. Have a great weekend, kelly. You too. Thank you. Creepy masks. Yes. Lets get back to seema mody with more details on the chipotle secondary we told you about. Yeah. We have this update on that move in chipotle, that filing. It seems like again, the seller here is Pershing Square, and it has filed to sell its entire stake, kelly, and this is Pershing Square and bill ackman against shares now down half a percent. Not as much as we saw initially after hours. Back to you. Thank you, seema. I admit this is a head scratcher. Unless its just kind of an abortive turnaround that wasnt going to happen. Yeah. Thats a capitulation. Thats quick. Valiant hasnt worked out, herbalife, they have redemptions. Meet redemptions you have to do something. Or just you had some voice on the board, maybe their strategy doesnt seem like its going to go the way you want. Chipotle shares are not moving hugely which surprises me more on that. Yeah. Theyve been kind of bouncing around the floor. Yeah. All right. Well continue to follow the story. Thats for pershing the secondary. Uber board member Arianna Huffington weighs in the company used a tool to evade authorities in cities where the service is banned and well discuss how the French Election could impact the market especially if it does result in the nation leaving the eu. Better value by having better values . At blue apron, we work directly with more than a hundred family farms. So instead of spending on costly middlemen and supermarkets, we can invest in the things that matter most making farmland healthier. Cutting down on food waste. And bringing you higher quality, fresher ingredients for less than you pay at the store. Because food is better when you start from scratch. Blue apron. Uber under fire again today with word it utilized a program to deceive Law Enforcement officials, creating rides where none may have actually existed. All this on the heels of a form female engineers allegations of Sexual Harassment last month. Uber board member Arianna Huffington was at the ride sharing headquarters this week to monitor the harassment investigation. We spoke with her and joins us with the details. Hey, kelly. Thats right. Since she actually flew down to San Francisco to be part of an all hands meeting that ceo held, the crises have continued to pile up for the ride sharing company. You mentioned one of them, mike isaacs article in the New York Times talking about this gray balling tactic that uber used to sort of evade some of the authorities or track some of the authorities. Theres also the dash cam reporting where travis call la nick was seen having a rude interaction with a driver the head of engineering leaving. So i asked Ariana Huffington after all these events if Travis Kalanicks leadership is being questioned within the board as some investors weve talked to have said that it should be. Heres what she said. He definitely has my confidence, he has the boards confidence, and i have talked to dozens of employees, one on one, and they see from the actions that have already taken, that its exactly what you said. This is not about apologies. This is not about words. This is about changes in the company which are happening every day. Now i also asked her if she had spoken to susan fowler, the former uber engineer who published that explosive blog post about harassment and sexism within the company in the year she worked there. She says shes been emailing back and forth with her and that, yes, the lawyers are looking into every one of those claims she detailed in that blogs post. Huffington said uber has grown quickly and when a startup grows that fast there can be mistakes but she said she is fully confident that Travis Kalanick understands his mistakes and is the right person to lead the company and he will make it bigger and stronger in the future. Also asked her if more employees, particularly at the executive level, might have to two. She said that would be uncovered by the current investigation that shes helping out with, thats being led by the former attorney general eric holder. She said that if more mistakes were uncovered by employees, regardless of how they performed, they would be let go. Heres what she said. My promise was that as i put it, no brilliant jerks would be allowed in the company because as you know this is one of the problems when top performers and great executives are shielded because they are top performers and there has to be zero tolerance. And travis didnt just promise that. He demonstrated it. Now kelly, as for mike isaacs article in the New York Times she had not have a chance to see that because shes been in backtoback interviews here but she did reiterate yes mistakes have been made and they are cleaning them up now and shes fully confident thats going to happen. She should trademark brilliant jerks if that isnt already part of the lingo when it comes to talking about a lot of Silicon Valley culture. Good stuff. Speaking with arianna on the board of uber. The possibility of france leaving the eu is gaining traction as Marine Le Pen makes a bid for the presidency. What that could mean for markets is next and imax has been struggling with profits in china. Richard gelfond joins us with what that means for the companys bottom line and any future plans in china. Youre watching cnbc, first in Business Worldwide. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Adios, honey, hasta la vista, baby. singsongy im a fat guy in a little coat. Fat guy in a little coat. That rug really tied the room together. Any questions . Bueller . Bueller . Stream all your entertainment. Introducing at ts new unlimited data plans. Plus, get the amazing new iphone 7 on us. Welcome back. The first round of voting in frances president ial election is next month and its been a contentious race when the National Front leader Marine Le Pen stoking concerns france could leave the European Union. To michele who has the latest on the poll numbers. She has driven a lot of fear in the markets but today investors seem to be breathing a sigh of relief after a month of highend worries that french candidate Marine Le Pen might win the president ial election. The volatile French Election has taken yet another surprising turn. Former frontrunner Francois Fillons campaign is in crisis because hes under indictment for allegedly giving his wife a no show job costing french taxpayers nearly 1 million over the last decade. Hes staking his campaign on what he hopes will be a big rally on sunday. He says that the crowds dont show up he will drop out. Election watchers were worried that fillons crisis could pave the way for le pen to move into the lead. She represents an existential threat to the Euro Currency because she hates it. I dont want to accept the euro which is no longer a currency in the spirit of the European Union but a weapon it sticks in our sides to force us to go where they please. The euro is a failure. Its an economic failure. Its a social failure. There is a new poll out today however that suggests her threat may be receding. Independent centrist Emanuel Melancon has pulled ahead of both and investors who had been selling french bonds and seeking safety in german bonds seem to be moving back into french bonds the spread between france and germany has gotten tighter and that means that people are more relaxed. The euro hit a fourweek high against the dollar today and the cac was up 0. 8 ous performing all of the other european indexes. If weve learned one thing about this election, its very similar to the u. S. Election. Its crazy every day and things could change. The polls which show, you know, not that big of a gap between these two candidates if theyre understating the support like it did in brexit and for trump and she wins that possibility is at least out there. Are you surprised markets have held up as well as they have . I absolutely am. Youre suggesting if she wins the euro could potentially be destroyed because she would want it to end, want to remove france. If that were to happen, what would happen to Financial Markets . The u. S. Market seemed very, very relaxed, maybe they think its not possible that shes going to win. The other possibility is, maybe theyre coming to grips with it. Weve been talking about this possibility, god, since 2010. Maybe they are thinking its not going to be that big of a deal. I dont know. Thats the crazy thing when you read the stories heres how she would bring back the frank and everybody else, in the wall street journal you start to think, are people too blase we will see how the rally goes and vote goes. Thank you. Michele caruso cabrera. Talk about chipotle shall we. Back to seema mody. Hi, kelly. Pershing square has a filing which has more information about chipotle. There are no current plans to sell chipotle shares. The agreement as stated in the filing allows chipotle to sell pershings shares from, quote, time to time in the future. But again, no sale right now. Back to you. Seemed like an oddly quick turnaround and the shares werent down that much. Listen, we dont know exactly what is behind all of this. I think maybe if you get to a 10 holding, there might be something formally that you have to register if you intend to sell at some point. I dont know if thats true. It seems a mechanical kind of legalistic thing. Chipotle shares down less than 1 on all of this. Dont want to shell out 500 for an oculus headset. Imax has the solution to give you a Vr Experience without the haeftsy price tag and the companys ceo will tell us about it right after this. Hey gary. Oh. Whats with the dogsized horse . Im crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. Isnt that right warren . Well, you could get support from thinkorswims inapp chat. It lets you chat and share your screen directly with a live person right from the app, so you dont need a comfort pony. Oh, so what about my motivational meerkat . Inapp chat on thinkorswim. Only at Td Ameritrade. Itthat can make a worldces, of difference. Expedia, everything in one place, so you can travel the world better. [he has a new business teaching lessons. Rodney wanted to know how his business was doing. So he got quickbooks. 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At baird, we approach your Wealth Management strategy the same way to create a Financial Plan built to last from generation to generation. Well listen. Well talk. Well plan. Baird. Imax is embracing the world of Virtual Reality. They are opening a location in los angeles with head sets and a variety of content. Joining us now for more, welcome back. Good to be back. Were used to talking to phone companies about it. Theyre often putting the mobile phone in one of these head sets or one of these specifying companies, or theres playstation doing something. What is imax bringing to the table here . So most of the Virtual Reality is folksed in the home. So uhdc or oculus or the various home products. We feel that it will take a while to reach adoption in the home. And the reason is because the head sets are expensive. And the content is expensive. So maybe it costs 1,500 at the high end. If you could go to centers and get the best vr possible and spend 10 to see it instead of 1,500 to see it and it is the best available under the imax brand, thats a really good proposition for consumers. And i read that youve had 7,000 customers. Is this a better way to try it as opposed to setting it up for yourselves . I think it is. I have inner ear issues. Whenever i do one of these things at home or anything, i get whacked out. So you want medical attention on the premises . Vertigo or something. If i only spend 10, its not an investment. It seems we have a lot of staff. If you start crashing into a wall, we can hold you up. So is it a menu with various experiences . Or do you have release dates of a new group, a bit of content or events or Something Like that . By the way, it is both. So it looks like a movie board. It shows what you the times are. And you can buy one tenminute experience. You can buy three of them and group them but it will be a large platform. So when we do Vr Experiences with movies, for example, transformers has a companion vr piece. It will say coming soon of so think of the movie business. You have the first window, theaters and then last one, mobile. Eventually we think the same thing will happen. So the first one will be the imax location vr center and then it will go over other platforms into the home. So are these more profitable than your typical theaters . Should we expect to see more . This is a test. Well open six of them over the next few months. The ones in l. A. But some in the u. S. , in japan, china, england and the middle east. And well experiment and see what the through put is, what the a. Price is, what it costs. And then at the end of the year well make a decision whether to spend a lot of money or a little money. Were not making a big bet right now. We think it is a bet where theres a lot more upside than down side. So well bet a little. If it works, we think we could work out hundreds or thousands of these. Let me ask you about a big bet, china. Even as the numbers are looking better, are you finding it is tougher going . Last year the slate was tough. This year so far it is looking good. As a matter of fact, yesterday, logan opened in china. We did 1. 6 million in one day which is a decent part of box office. I think mostly based on content. So it was some tough sledding and now it seems better. Richard, thank you for joining us. Well get tickets to the Vr Experience. Im curious. Well hold you up. Dont worry about it. The ceo imax. A couple seconds left. I want to circle back to whats left. Yellen talking about a rate like thats coming of next week we get the jobs numbers on friday. And the labor force. Not the waning growth . It depends on the competition. If it is weaker because people are coming in, fine. If its not, no bueno. I think the wage growth was the most important thing. When you have a number throwing, when you have a president throwing numbers around like 93 million which is literally any adult who is holding a job or wanting one. If that will be a policy goal, is there really a ready work force . Look at the long end. The longer end. It is hard to see financial stocks going up. Pensions, insurance. Is that it relevant . It is relevant. The banks who make the money on the spread between the long and the short. Thats where they make the money. I understand. Evan and michael, thank you. Pleasure as always. Have a great weekend. That does it. Fast money begins now. It sure does. Fast money starts right now from the market site overlooking New York Times square. Our traders on the desk. Tim seymour, guy adami. Hi. Hi. Tonight on fast, snap surging for the second straight day after its ipo debut. The company now worth more than twitter, American Airlines and chipotle. Despite the hefty valuation, the company could actually be cheap. Well explain. Plus, gold just p