Power lunch starts right now welcome. I im only slight movements and dow looks like it will end another week higher. What a year its been. The s p lower by 4 and nasdaq lower by more than 14. Some of the big single stock stories. Nike trying to drag the dow down the margins put had hit on weaker demand and cost cutting www too many ws, the wwe body slammed reports that Vince Mcmahon is selling shares to restart the old xfl. And san diegobased ignyta being bought by roche for 1. 7 billion. President trump leaving the white house for christmas, but he signed the tax bill into law before he left and more companies now saying that they will give out bonuses to their employees as a result of that tax bill live at the white house with more brian, thats right left the white house earlier today and the president is on his way to maralago where he will spend the christmas holiday. Before he left, he took care of a couple pressing matters of business signing the cr the continuing resolution that will keep the government open until january 19th no shut down between then and now. There you see pictures of the president at his departure there. He is expected in florida later this afternoon he also signed the tax bill, sort of an impromptu signing and one of the things the president the way they reacted to the passage of the tax cut heres what he said. I consider this very much a bill for the middle class and a bill for jobs. And jobs are companies and corporations and you see that happening. Corporations are literally going wild over this i think even beyond my expectations and to the president s point, take a look here at some of the companies that have paid bonuses, raises or otherwise rewarded their employees with salary increases a huge list, including at t, fifth third, boeing, comcast, nbc universal, the Parent Company of this network and sinclair broadcast, bank of america and on and on. A long list of companies enth e enthused about the tax bill, citing the tax bill in their decision to reward their employees. Thats exactly what the president has wanted he said he has been surprised by the reaction from some of those companies so far this year its gone beyond what he expected well wait and see what it brings because the president will come back january 19th theyll have that Government Shutdown dead line a big debate there over what to do to keep the government open there and on to the rest of the agenda, including infrastructure and welfare reform here at the white house. So, a busy 2017 and, of course, teeing up a busy 2018, asally. Eamon, thank you a crypto comeback of sorts at this hour tracking all the coin carnage. With all that volatility we learned that Mike Novogratz putting it on pause due to market conditions, although he says hes still current currencies now after surging to 20,000, bitcoin has below 13,000 guys, thats an over 7,000 move in the span of six days. Bitcoin now down 40 since last sunday when the bitcoin future contract went live the selloff not confined to just bitcoin. Bitcoin cash and among other crypto currencies are now down 20 in the last 24 hours when it pertains to bitcoin, though, there have been five separate instances this year when bitcoin has dropped 30 but for longterm investors, heres a Silver Lining the 30 drop has been followed by an average 20 gain one week after. Guys all right, seema, big move there. Lets go down to bob at the New York Stock Exchange. Bob, it doesnt appear to be systemic, i guess. Doesnt seem to be impacting the equity market. I would imagine theyre talking about it down there, as well the mania extends all the way to the floor of the New York Stock Exchange let me show you what is going on with the cme future. Remember, this is only one week old. The contract there are price limits on it pauses that may or may not halt tradings once you hit 20 down, though, you cant trade below that you can trade above that you see that oval that i circled there, thats when it hit the price limit of 20 down a little after 9 00 for almost an hour, it did not trade above 20 and you cant go below that only close to 10 00 did you see it was starting to move up above that those were the price limits and weve come off of those lows right now. The important thing, take a look at the cme contract for the whole week weve had huge volume today. Almost 2,000 contracts thats 700, 800 would be an average. We had four, five times normal volume this is the same with the contract, as well. We had four, five times normal volume there, as well. So, what do you make of all this what we have is hitting price limits and extremely high volume this tells me that youre seeing professionals come in and sell their positions and they may be covering, putting taking off their short positions at this point. Remember something, bitcoin is primarily driven by the cash market that is very, very important what we have here this week. We have talked about huge price swings 20,000 to 12,000 we see competing coins coming out and going crazy. We see talk of bitcoin etfs. And the litecoin founder saying he was liquidating his holdings. Lets put up bitcoin and the key point here is this is not driven by the futures market, it is driven by the cash market, even though that is the instrument we choose to focus on because that is a tradeable instrument. It is the cash market and youre getting enormous volumes here in bitcoin, as well as some of the other crypto currencies that are out there. So, my opinion is that youre probably seeing a lot of retail traders over in asia the ones that are driving this and then youre seeing people here in the United States in the futures market react to this get the sequence correct i think its very important. Guys, back to you. Any clues, bob, whether or not traders here will get margin calls . The decline on bitcoin is steep enough there are things called Maintenance Margin on the cmes future contracts as well as the futures contracts. For example, 47 i believe was the initial margin who had to put up at the cme and the Maintenance Margin is below that if you drop below and i think its 43 below 43 thats in the account to cover everything, you could potentially get a margin call. So, yes, that is a possibility and they put it in very high margin requirements, relative to other assets for a reason. Thank you and here is exactly why they did that and people like thomas who was extremely nervous about this and put very high margin requirements are looking fairly pressed and he did allow marg w higher margins thanks. Joining us on the cnbc newsline fast money contributor brian kelly. Great to speak with you. You sent out earlier today an email which basically sort of recapped what we were seeing in terms of the bitcoin that weve seen in the past bitcoin has seen many, many double digit declines in the past only to be followed by triple percent gains in the six months or so afterwards. Why wouldnt this time be different because it feels like theres more Retail Investors and those guys arent used to seeing declines like this. Thats the incremental buyer here that brought us to the most recent record high well, yeah. I mean, the retail has been the entire buyer, not just the incremental buyers no institutions in this space. Could this spook out some of the weak, absolutely the same buyer you had for a long time. I think what people need to know you get all excited when you double your money in a couple weeks. You have to understand that you can lose 50 of it at any time this is normal volatility for this market. Normal volatility some people might accept that, but it might spook people further that they cant get their money out. If you wanted to sell right now because you think that this is it, its very difficult to get them coinbase right now and sell your position. Yeah. If not impossible im sorry if not impossible to do that right now. I think the coin base is in post only mode there which means you cant trade there. This is Early Technology weve seen very similar thing during the internet bubble and when we started to have all these alternative trading systems. The tax isnt scaling as fast as people would like it oh, geez, im going to go put 401 k money in this and double it by next year. Were in the very early days tech is going to break and there is going to be extreme volatility ill take the other side. Im a regular viewer of fast money. You prefer some of the other coins, as well could this be a good thing for bitcoin. The other coins are falling more the lite coins and some of the other ones so, does this because bitcoin is compared to the others, compared to the others, holding up reasonably well in the face of this, does it give bitcoin a measure of more credibility in the Coin Community well, i think what will give it more credibility is if it survives this fall another time. So, most of the investors in bitcoin have been through all of these types of ups and downs, including, you know, several months where bitcoin just kept going straight down. In terms of the other coins, there are some coins that are quite similar to bitcoin that are trying to be a competitor of b bitcoin. Bitcoin is the biggest and the strongest. So far its surviving. Im of the camp, 10 to 20 different coins and protocols that operate this is very healthy Market Action lets wash out some that we can and lets get back to the business of building up the tech brian, michelle here. Why do you think all the crypto currencies are falling right now . Well, thats just market. Everybody is panicking this is fear and grief the miracle isnt that somebody say something. Was there any kind of thing that happened or is this just it is a little bit of both. This started in asia and what you had was rumors at korea and japan would ban bitcoin and this happens very, very often and the heard sell so far weve seen nothing of that from what i can understand, nothing of that. In fact, going the other way and putting regulations in, which is probably a good thing. So, again, this is just, this is what bitcoin does. Its extremely, extremely volatile youre not part of the herd what are you doing today i bought bitcoin at 11,500 and 11,800 not cash, not litecoin and not some of the others no, i only bought bitcoin but im not long i sold that and i mentioned that on fast money. But i am still on the other ones and i still think they go higher one down. 8 million to go. Thanks, brian enjoy your holidays. Weekly counts just out jackie deangelos is at the cumoddy desk drilling rigs unchanged this week 747 up 224 versus a year ago now, this was another wild year for crude. Prices up 9 from the beginning of the year. But, remember big fluctuations in between were watching to see how u. S. Drillers will proceed. It seems like there is caution here, even though it is an attractive time to buy got it. Thank you so much, jackie. Will the new tax law really cause an exodus from hightax states like california live report coming up. And theres not much time left to do the holiday shopping, but the big shippers say they can still get your gift there on time shheperun tuhe lastminute ru wn ow lchrerns. Its all yours. Wow record time. At cognizant, were helping todays leading Life Sciences companies go beyond developing prescriptions to offering subscriptions with perso nope. Get ready, because were helping leading companies see it and see it throughwith digital. The markets change. At t. Rowe price. Our disciplined approach remains. Global markets may be uncertain. But you can feel confident in our investment experience around the world. Call us or your advisor. T. Rowe price. Invest with confidence. There are just 2 1 2 shopping days left to christmas morning. You better get what you need believe it or not, you can still order online and get your gifts on time. Pretty incredible. Morgan is checking in on how the big shippers are handling the lastminute crush. Morgan hey, brian. I wouldnt necessarily suggest that, but combined u. P. S. And fedex expect to deliver 1. 1 billion packages and this is historically the biggest week for that so, add in u. S. Postal service 850 million packages the numbers i eye popping. Based on thirdparty data, pretty well. Ontime performance from fedex ground 98 last week and u. P. S. Ground after 97 after service hiccups. Preliminary results for this week show both are performing even better as we get to the final three days demand for services remains very strong. We returned to our narmal delivery time and transit after the initial cyberweek surge that exceeded our operating plan. As for fedex ceo fred smith saying fedex is on track for another record Holiday Shipping season it is the best peak season ever. As for the postal service, last mile delivery, which is what amazon uses very heavily, 99 ontime that is according to ship matrix and volumes higher than expected it forecast 6 million package deliveries on each of the sundays in december. This past sunday, the usps delivered 10. 5 million packages. That is a direct reflection on amazon while we wont know the costs of all this until we get earnings next month, overall, operations do seem to be going as planned guys good news for lots of people waiting for presents thank you, mortgage. Take a closer look at wall streets take. Welcome to power lunch. Thank you very much make sure everyone knows youre a credit analyst not a stock analyst. Thats right. These are pretty good numbers. We have seen absolute disasters this time of year because they could not handle the peak demand have they figured out the logistics of this time of year they have mostly figured out the logistics this time of year. Volume show up for where they plan for and fedex has had no problems this year. U. P. S. Had some challenges after thanksgiving and part of that was because volume showed up particularly in atlanta more than they expected why are they using algorithms . Theyre using all of the above. But it depends on their customers, their large shippers and with having inventory distributed across the country when we place an order online, Big Companies can ship it from different places and depending on the flow of goods, that can affect where packages are sourced which can enter into a system in a place unexpected there is exxon and chevron and thats it in the shipping space. I know that uber has gotten into it a couple other smaller start is this a space, maybe this is out of your wheel house, but is this a space right for disruption i just mean it seems odd there is only two. Amazon is threatening to go into their business, right exactly there is potentially an opportunity, but, remember, three players in addition to the two. We have the post office. And if you look at the total volume, 850 million packages by the post office. In the u. S. , u. P. S. Is going to do 650 million this year this peak, excuse me, and fedex 300 million. 1. 38 billion packages. You need the infrastructure and the system and the network the post office has done a great job. Sundays theyre out in my neighborhood delivering amazon packages kudos to them. But the post office still loses billions of dollars a year how does the post offices, you know, lack of recognition of a Balance Sheet affect the fedex and u. P. S. S who have to make money . I think the pricing is competitive across the space so, theyre not affected additionally no one carrier can manage the totality of that volume. Even if customers want to increase volumes, theyre tapd out today. Thats why we see the increased investment at u. P. S. Taking cap x revenues to up to 8 from 4 through past years and fedex is maintaining it at 8 revenue they have telegraphed, though, that they would be willing to increase cap x because of the tax bill. How much could they increase without challenging their Credit Rating or how you view their credit both companys ratings are comfortable where they are the tax benefits of tax reform is going to provide meaningful increases in cash flow but the companies are going to stick to their existing, their current policies for application. Theyre going to focus on their networks and infrastructure to try to preserve their margins as ecommerce grows. They make contributions to pension plans. You dont think theyre going to increase because of tax. I think it will increase incrementally, but depending on how much more volume comes from the higher gdp gentlemen, happy holidays thank you for coming in. Coming up wihat the wealthy are getting ready to do for the new tax law. Om berto pprptuys ull the trigger on the new loan. When power lunch continues of. With ingenuity, of. 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. What we do every night is like something out of a strange dream. Except that the next morning. It all makes sense. Fedex powers Global Commerce with vast, farreaching networks. Deep knowledge of industries. And, yes. Maybe a little magic. New data out on the housing market, diana out with the housing numbers. Diana . Big jump in new home sales. Remember the census count signed contracts in november not closing. This was people out shopping for homes just as talk of the tax bill was really heating up sales of newly built homes jumped 17. 5 for the month but octobers number was revised down dramatically and september was revised down slightly. If you smooth it all out, including all the storm issues to a sixmonth average of 622,000 annualized sale versus year to date, youre still ahead nicely but not quite that much. Biggest gains were in the south and the west the west is where the supply of existing homes is tightest the number of homes for sale, newly built, didnt change so, with all this new demand, the month supply fell to 4. 6 months from 5. 4. Thats a 15 drop in inventory the median price of a newly built home up slightly just over 1 from a year ago builders are still trying to get more entrylevel product in the mix. Still not there yet, though. Back to you guys thank you very much now we have kate rogers with a news alert kate were talking about the latest company to make announcements regarding wages and bonuses in the wake of this tax reform bill. They are going to be raising their hourly pay for minimum from 12 an hour to 15 an hour. Effective january 1st. Paying out bonuses in january for threequarters of their employees. Theyre saying about 27,000 workers who are going to receive a bonus. They also donated 100 million to Philanthropic Fund and overall the total cost of this program is 152 million. Back over to you 1,200 per person. About 1,000. Absolutely. 1,200. Fantastic. Thats meaningful to increase the minimu