An hour or two off makes a difference . Its like a new jet lag every week think about that the three day weekends yesterday kaley was up early. That kept me on track. If you go to bed early ben franklin. 7 to 8 hours, instead of getting fancy i thought you were going with the early to bed, early to rise. It sounds like youre getting a little bit too how does this guy know . If you get 7 or 8, youre great. God bless you if youre getting 7 to 8 now youre saying it has to be this time i can call you early on weekends if youd like lets look at u. S. Equity futures. Its been a huge year already, just two trading weeks in. Look at this this morning, futures are surging, dow indicated up by 267 points s p futures up by 17 nasdaq up by 14. This comes after last week where the dow was up 507 points. Nasdaq up by 1. 7 . Gains across the board with the dow, nasdaq, s p 500 and many other indices result ending at alltime highs its continuing again this morning. Hard to try to get your arms around what this has meant this is the tenth trading day of the new year what is it so far for the dow . 507 points last week. The first week was more 571 was it . Am i off by a little its a thousand points in two weeks. We did have the big setback when the markets were rattled by the china story. Down 16 that day . Down 16 we were jumping on that story. Jumping. Jumping. The markets were rattled something to watch this morning. Its hard to imagine watching this for years, watching this happen lets look at what happened in asia you can see up across the board. Nikkei up by 1 . Hang seng up 565 points a gain of 1. 8 . Shanghai was up 0. 8 then this morning in europe, trading is already under way there are green arrows there the dax is the biggest gainer, up by more than 1. 1 a half percent gain even in france with the cac there. Look at treasury yields. Last week the yield dipped on the tenyear to 2. 55 . This morning its lower, yielding 2. 56 we thought we would be up at 2. 6 north of that last week you can see there is some resistance to those yields all right dow component United Technology is out with quarterly numbers. The Health Insurer earned 2. 59 a share for the Fourth Quarter, that was 8 cents above estimates. Revenue beat forecast. United raised its fullyear forecast the improved outlook reflects the effects of tax law changes well dig through the numbers with ana gupte in a bit. On an adjusted basis, the number goes from 10. 55 to 10. 85 the futures not hurting because of this. As we know, the dow component. Yes really . You remember its a newer one. It is good for its one of the benefits of getting up there a bit. Things are new many more times you see the thrill of discovery happens with things you already know yeah. Thats one of the benefits. The other article i read on my vacation, neither of you are anxious people do you know alzheimers is linked to anxiety . Oh, good. You guys are relaxed people im anxious. I may have this problem. You are anxious about this news i might become anxious. Well talk about bitcoin. That may bring on some xankitan. The euro trading at the highest level since 2014 yesterday and tthe ecb said bon purchases could be ending. Big swings in currencies would be problematic and new this morning, the yuan mid point set at the highest level in more than two years 6. 45, trading at the highest level against the dollar since december of 2015 for you cryptocurrency maniacs out there, bitcoin plummeting this morning, falling below 12,000 to a sixweek low. Traders cited fears of regulatory crackdown that is taking place in south korea. The countrys finance minister said banning cryptocurrency trading was still an option. Thats the overhang on bitcoin and the cryptocurrencies if you were up there when it was at 18,000, 19,000, not great crude prices this morning, brent crude briefly topping 70 a barrel a level not seen since the crude slump of 2014. Higher demand driving up prices fueled by economic growth. The price of wti now, 63. 82. Ive been watts ahatsapping some folks in saudi, all rejo e rejoicing at this news the Higher Crude Oil prices means this aramco ipo will have a better shot Going Forward. Do you know anything antidbot our friend two or three weeks from something happening. I heard he went to a horrible place. Went to a prison. We think theres some action. I dont know if hes worth 17, 20, whatever it is, only seems like an easy decision. Are you stubborn is the ritz nice heres the big tell the ritz is starting to it says theyll start taking patrons february 1st thats weird. So everything has to be resolved by then. Either you settle by then or you will be relocated. Im not sure. All i know is the website says this phone line doesnt work, but they are starting to take reservations in february. Who is booking couldnt he just cut back on his lifestyle a little pay the 6 billion, left with 11 billion. Just tighten the belt a little this is the cache story for him. I understand, for me i think hes about 61, 62, isnt he id want out as quickly as possible if i was left with 5 i might be okay 5 billion, right yes i think that the principle of the thing . He wants to live he wants to live in riyadh, run the thats another question why . I would not want to stay. For a lot of reasons. If everything was great, i would want to go, monte carlo, paris, here he could come to new york the feeling youre get sk there will be an answer. I think theres something about to happen. He could be a cnbc contributor to make up for some of the 6 billion when in doubt supplement. Talking about saudi, an investor or an investor or one of the biggest investors in softbank is saudi. Softbank considering an ipo for its japan wireless unit. The company would list about 30 of its shares in tokyo and another overseas market such as london the listing of those shares would raise about 18 billion, making it one of japans biggest ipo ps s in recent years. Softbanks japanese telecoms business is the cash cow making up nearly half of the earnings the firm also controls sprint in the u. S. , but some have been concerned about the large debt load with Interest Rates rising. Shares of softbank rose 3 in tokyo on monday. They closed up about 2 today. Heres some news for anybody watching this over the weekend new this morning, japanese broadcaster nhk has deeply apologized for sening a ne inses alert to theirwebsite and app saying it appears north korea fired a missile. Nhk says this was a mistake. Which brings us to what happened in high hiawaii over the weekend during a nuclear drill, an emergency worker hit the wrong template and people in the state received phone alerts that a Ballistic Missile was on its way to hawaii. The siren tests have been suspended pending an investigation. The worker has been reassigned but it caused massive hysteria, people hiding their children in underground locations, thinking they had 19 minutes. Right something happened. I wouldnt know what to do in that situation here are pictures of children being hidden under ground. Lets get to eamon javers in weekend with a look at the weekend political headlines and a look ahead you were able to, with impunity, have that curse word you did it on our show you only said it once. Did you say it throughout the day . Did you total how many times you were able to just cast off the shackles and just let it all hang out how many times did you say it . I said it twice i wasnt asking for a repeat. Thats now three times. But you know why im asking im asking because cnn apparently said it 195 times i think yesterday moor maybe the day before its not the saying of the word, theyre still on that story, maybe you are, too i would like to put it in moveit forward to the extent o whether or not we will shut down the government or not based on daca futures are up 260 points. I dont know how you tie it together bizarre. I dont know. Youre a markets guy, im not. Maybe its the case that the markets look at this shutdown and say weve seen this story before, seen the Government Shutdowns before its basically some National Parks close, some inconvenience for people, but nothing significant happens when theres a Government Shutdown so the market is probably brushing that off. The political problem for the president is hes still dealing with this a week later after the controversial remarks were made in the oval office the question is how does that affect his ability to get a deal done the president shifted from not denying he made the comment to sort of denying that he made the comment or at least throwing some cloudy air out there about what he said, what he didnt say in that meeting. So, that opens up the opportunity now for reporters to spend the next couple of days tracking down everybody who was in that meeting and asking them exactly what the president said. It extends the story into another week when the white house could have shut it down last week. The president spent part of his weekend this weekend denying that he was a racist heres the president over the weekend. No, no im not a racist im the least racist person you have interviewed that, i can tell you the president got political cover from rand paul of kentucky who had this to say. What i regret is i do want to see an immigration compromise. You cant have that if everybody is out there kaling the president a racist how does this impact the daca debate here is the president s tweet from yesterday taking a swipe at dick durbin, who revealed that the president made the remark. The president tweeting out senator dicky durbin totally misrepresented what was saided a the daca meeting deals cant get made when there is no trust. Durbin blew daca and is hurting our military the white house has said they want a daca deal they want to put this behind them daca is defers action for childhood arrivals, those are the people brought to the United States as children who are now young adults there was hope they could get a deal that would handle that group of people and then move on to a broader immigration deal. The president seemed open to that early last week now the politics have been blown up really by the president s comments the question is where do we go from here and well see when lawmakers get back to town today. Futures pointing to a 250point gain at the open for the dow, but are we in a bit of an overshoot phase of the bull market mike santoli joins us right now. Are we could be. Though i think its important to define what that might be trchlt is and there is no definition of what an overshoot is its a phase when the market shoots higher from already high levels, investors extrapolate good news far into the future. So there is a lot of evidence this is the kind of phrase coming incom phase this year. This is the fourth day in two weeks the dow is up 0. 8 youre seeing lots of flows into funds, sixth highest flows into equity funds earnings estimates up 2 so youre outracing the forecasts of the analysts. Theres some catch up to do. Riskier cyclical stocks are working. All of this stuff builds to this idea that you might be in this phase where good news is good news and people extrapolate it further. The vix is up year to date with the market going straight up that tells you the character of the market has changed theres more juice to it more demand. There may be more volatility, but its to the upside we have a springloaded situation. Im not saying its a bad thing or well get a nasty pullback, but you are seeing some of these sentiment and momentum measures getting to multiyear highs. It doesnt seem as if this is the culmination phase of anything an overshoot phase can go on for a long time. Lets talk more about this. We will bring in kamal sr ishgsr good to see you. Good to be back whats happened in the first nine trading sessions that weve seen this year if you look at history, you will see the socalled irrational exuberance people have f that is what mike is talking about, tends to carry on for a long period of time. In the 1990s you had Alan Greenspan speaking about it in december of 1996 you didnt have a crash until 2000 in the first half of 2008, like now, the twoyear yield went not just over 2 it went over 3 in june. Then many Central Banks, including the European CentralBank IncreasedInterest Rates. The ecb in july of 2008 before the sky fell a couple months later and they had to reverse. Is that what were seeing here irrational exuberance or have the rules of the game changed so significantly that people are trying to figure out what this all means. Its not irrational exuberance if theres a reason for it absolutely. You had the market run up so much many december in anticipation of the tax law changes. Once again in the early part of january, it does qualify for a significant part being irrational exuberance. Janet yellen referred to the market being somewhat rich in june i dont know what she would say today. I know what Warren Buffett told us last week. He doesnt market time things. He knows you wont always have rational action in this. I asked if he thought prices were overvalued because of the runups, he said not based on what youre looking at in regards to Interest Rates. I watched your interview with interest if you are like Warren Buffett and are looking at it from a longterm point of view, maybe it makes sense if you do not look at Financial News on a daily by sis basis but are look buy and hold investor. The other question is with Interest Rates being the issue of gravity, even if Interest Rates go to 3 , where does that put us its a slight challenge to the setup but i think the credit markets will tell you if higher rates are something to worry about. If Corporate Bond yields shoot up more than treasury yields, that tells you theres something in the system thats not right so i do think you have that kind of a cushion in there. If you were inclined to say the markets run a lot, i have been in it, should i sell, is this a moment to sell youre doing a series of checks. Credit markets, are they upset no momentum looks good. Market all these things check out. If youre in the cockpit youre not saying there has to be an emergency. All those things are down the road if the fed comes out and take s noties oftakes notice of how high the market is, sure, its time for a gut check. Last week the credit market high yield spread went to a more than tenyear low of 318 basis points thats not suggesting that anybody is scared. So you can have this bubble get bigger, but the question is how big it gets. Irrationality can last a long time you think its a bubble thats an interesting perspective. You think at these prices it doesnt make sense i think its a bubble what youre getting the message from is the tenyear yield, which as you just said, is even lower than where it was last time the two to tenyear spread is close to tenyear lows that you didnt see since 2007. That has to do i think with what other Central Banks are doing. What do you think the true downside is . The true downside is for equities to continue to rise and have a much sharper fall at some point in time. But im saying is this a 5 down 10 down 5 down would bring us back to where we were at the beginning of the year. 5 or 10 is nothing. You have to talk in terms of 15 to 20 decline but the question is when does it happen the later it happens the bigger the magnitude of the decline sri, thank you very much thank you mike, great to see you. Coming up, United Health out with earnings. Well dig through the report with analyst ana gupte after the break. My experience with usaa has been excellent. They always refer to me as master sergeant. They really appreciate the military family, and it really shows. Weve got auto insurance, homeowners insurance. Had an accident with a vehicle, i actually called usaa before we called the police. Usaa was there handson very quick very prompt. I feel like were being handled as people that actually have a genuine need. Were the webber family and we are usaa members for life. Usaa, get your insurance quote today. United health group out with Fourth Quarter earnings moments ago. Joining us is ana gupte. Can you start explaining the what was the tax laws affects on this quarter what was that number are they adjusting everything . Are they taking it all in one fell swoop for lou it will affect the company does it have to do with using losses the main thing is what they did for 2018 they guided up to 27 , thats better than consensus. Is that based on the tax law change based on the tax law change more flow to the bottom line. Unlike banks which had charges, they cant use their net operating losses to the same extent they had different accounting adjustment to their result this was a positive one. Its a positive one the products and benefits had already been priced. You have to take that into account. 2019 could be perhaps a little less to the bottom line. I dont think it will be 17 17 beats street expectations. Its a positive catalyst what do you see in terms of with everything swirling around, with exchanges, medicaid, you saw what happened last week, how does this put United Health in a sweet spot for you i think so, as we talked about last time the burning flat form for change and policy in 2018 is much less Going Forward. There is a dot that needs to be connected between tax policy and Health Portion if a portion falls to the bottom line and a portion goes to the consumer, medicare is getting from a third of american seniors to about 50 ofamerican senior before, say, the 2020 election for 2021 thats a positive. Its a positive for managed Care Companies and seniors. States are happy with the managed care and worker requirements i dont think will be negative. If anything it could triger more privatization in managed care. Exchange is around 10 million, 12 million, it hasnt moved the needle that much on the mandate. We may or may not see the funding of the csrs. I dont think theres that much momentum in the senate theres some rumblings in the house to get that done the main thing is about a million or so people not subsidized are in a place where they dont have subsidized coverage to go into the exchanges. But now we have associated health plans, the selling of insurance across lines is t