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tv   Squawk on the Street  CNBC  December 26, 2018 9:00am-11:00am EST

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moonves sent you did he send you one? >> what i should have been getting is a business card from cbs. they're all upset. wait a minute, your shareholder is getting $120 million thanks to all this. >> jim stewart >> happy new year. >> thank you for being here. >> we'll see you tomorrow. "squawk on the street" begins right now. good wednesday morning, welcome to "squawk on the street," i am carl quintanilla with sara eisen. cramer and faber had the morning off. futures are slightly green this morning after the biggest christmas eve loss in history. oil remains below 43 not a lot of data today but s&p
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is up 5.5 in october futures is volatile. stocks are suffering their worse december ever. >> plus, the president's powell problem. once again the criticism from president trump. retail rises, a record holiday sales, it is not so rosie. the worse december ever. christmas eve trading put stocks on track as the worse in december the president latches out at the fed, he argued the fed is raising rates too quickly and now he says it is the team to buy into the market. >> we have a normalized interest growth, a normalized intere interest -- they ahave money in the bank i have great confidence and i have great confidence in
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companies. we have companies greatest in the world and they're doing very well they have record kinds of numbers. it is a tremendous opportunity to buy >> really a great opportunity to buy. >> after weeks of criticisms, the question of confidence also came up. >> when will the government be reopen >> what about the fed chair? >> we'll see, they're raising interest rates too fast. that's my opinion. i should have confidence >> s&p slides to a bare markeart on monday. dow is less than a percentage point away from joining that club we know how brutal breath was on monday that 49-1 negative. a lot of signals, short term rally can be in store. the market looks very washed out. if you compare it to any other period in terms of how far
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stocks are down and the number of stocks hitting new lows and trading above their longer term trend line it looks like the area around major market lows. my version of defining the baea market is when the over chute happens to the downside. in a bull market, you kind of have theov over chutes to the upside now that the trend is broken in some degree and you have to see if it will stretch low or not. the news today if we continue to sell off heavily it is hard to see the ammunition for that after you have the huge liquidation. >> we are in a bear market the s&p is close to a few points away it got there earlier in the day. that's the definition of a bear market when president trump says tremendous opportunity to buy
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stocks i think back to president obama, march, 3rd, 2009, i looked up the date less than a week away and he said if you got a long-term perspective, stocks looked like a good deal and he also mentioned company profits. >> profits and earnings ratio was his phrase that's what a president wants to assert if the market is down a lot. one thing the president also say was i think the fed is going to get it soon. that's wish fuful thinking it seems almost he's trying -- >> usia lot of his points ring t the journal opt-ed today
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this is not your typical season where the hawks and doves duke it out traditional signals just don't work >> we don't know how this unwhine happens and as a result, they argue we got to pay attention to market signals and not just lagging indicators. >> i think what was striking to me about that opt-ed, the s&p is fallen 8.2% since the fed's announcement at 2:00 p.m. eastern. did the fed make a mistake or did they read the signals wrong? this is what this is all about i spoke on monday during the middle of this big market fall-out we were talking about this idea everyone was worried of the mnuchin statement on liquidity here is what powell says the issue is not secretary
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mnuch mnuchin. the issue is the unnecessary rate increases that are fundamentally counter productive in the current environment i think is what the market is screaming at >> because you do have you know other things that are feeding into it. you want to tie an oil crash into it or investment globally, you have to go down. global markets were in a bear market is that all about that final night rate increase with the fed or have you decided to wait that decision and all of those things >> that's all going on >> a market was telling you that this was starting to infect the u.s. with the right call by the way, japanese stocks, you thought our market took it hard. down 5%.
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since then it rebounded a little bit yesterday and today. boy, that was wild >> that was an incredible session. >> a closer look at all this >> let's bring in our bernie mckinny. guys, happy holidays, good to see you both >> thank you >> jack, what's the likelihood that q-4 earnings prints are going to reflect what we see >> we are still looking at high single digits so i think in fact, i view q-4 earning season as welcome news for the stock market that's down on a lot of psychology and in fact bearishness is as widespread as the financial crisis with expectations this low, any
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outcome of good news is going to be taken as great news >> where does that lead you to on an actual basis >> well, i think one of the things we have been telling our clients that the economic data is still looking strong. we are looking at unemployment the lowest it has been since the 1960s. you are seeing wage increase both of these are good for consumers, the biggest drivers for economy and like wise of strong retail sales this quarter. the new york feds recession monitor shows a 16% chance of recession in the next 12 months. typically, 10% or 20% draw down are not accompanied by sessions. >> focusing on long-term allocations and having a little bit better entry point, it presents an opportunity to add to a few positions
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>> you know jack, on your central idea that any good news would help the market at this point, that's not true we started getting trickle out of china last week that the trade talks are going quite well and we are reaching high levels. we got new york fed williams coming on cnbc, hey, we are flexible and rethinking of the balance sheet here that rally lasted half a day or not even a few hours when do you think the environment changes where good news get interpreted as good news and does not fade the rally? >> i think it is a disconnect between kind of these headlines which we are hearing clearly i think treasury secretary mnuchin is no geitner, i think that was ad dumb move on his part >> get your house in order here.
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we have not heard anything from the economy and fundamentally from the market and once we do, we are going to see this disconnect is really extreme and we need to get back on track with fundamentals. you know in terms of valuation, still u.s.equity markets still over valued if you take the landscape into consideration international develop is fairly priced in emerging markets last time i ran a valuation, i am looking at roughly 10% the next three years >> burns, you know we are so far below the highs in a short period of time that it seems that we could be arguing about the market verses the fundamentals for a while i wonder how you think this may plays out, and the news from washington maybe quiet a little bit and we get one of these
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rallies, is it going to liberate us maybe 2019 and 2020 we'll be talking about rising recession risks and fed cutting rates and things like that >> i think the news flow permissive going to stay volatile as quite some time. as long as we have a president with an itchy twitter finger you do have the president talking about the trade wars and the central bank a lot of that volatility has been paved over by easy monetary policy it is getting tighter. you should expect higher highs and lower lows one of the things we have been focusing on is looking at dividend pay stocks to help push a lot of those blows and volatility going forward >> jack, think peace today and market of structure, 85%, they
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argu argued it is now related somehow to that model dorphing retail do you believe why this december has been historic? >> it has to be real investors and real opinions starting it. because they're all momentum based, piling on, we'll see exaggerations. when you see s6 or 700 points move a day, a lot of that is exaggerated algorithmic trading. the opposite is true market makers have to stand there and take the other side of the trade. that's liquidity as far as i am concerned. when you are piling onto a down market, that's removing liquidity from a market and it is something that i think needs
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to be address. >> is that true? i feel that you would take the other side >> i think he changed the speed of the rhythm. look, every time we compare this december or these gaps down or relentless selling, we are talking about the 1930s. it is not necessarily the cause it is just kind of changes the dynamics of how the prices get made >> not a lot of argument with jack in this building at least >> jack and burns, thank you very much, good to see you the president reiterating his stance on keeping the government shutdown until funding is secured for his border wall. what are we in day five yla ylan mui >> it is day five. the shutdown could last threw the new year
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president trump spoke to reporters in the oval office yesterday and refused to back down from that demand of any government spending bill include money for the wall >> i can tell you it is not going to be opened until we have a wall or fence, whatever they like to call it. it is all the same thing >> president trump says he'll visit a part of the wall that's under construction in texas. the definition of the wall he alluded to may be shifting he suggests that he can be open to border fencing. in an interview today, nancy pelosi accused the president of fear mongreling and fear tactic. once they take control of the house, the president said that federal workers want him to keep the shutdown going until there is a wall. however, one survey by a federal
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employee union, 78% of its members were concerned of covering their basic expenses, rental and mortgage while their paycheck is on hold. the house still needs to approve it the question for these workers is, how long can they go without a paycheck in the meantime, back over to you. >> thank you y ylan mui thank you, we'll talk to richard kovacevich later in the hour ten days in a row, the s&p closed lower than it opened. e atapnsod, pe tay we'll be back in a minute.
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take a look at futures this morning coming off the holidays, one of the worst christmas eve performance. the dow is set to be up at 100 at the open and s&p is a little less than half of 1% nasdaq is bouncing 60 points dow is down 5,000 points since hitting its record highs joining us now, gordon what's your read on this in terms of the intensity of the selling, where is it coming from and what clients are positioning for going into next year, gordon
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charlop. >> we are seeing some sellers in the wing i don't think they're going to explode them if they can stabilize it, it would be nice. as far as how it is gone this year so far, normally you see volumes spread about 50/50 between hedge fund and mutual fund we are seeing people preparing for redemptions. what does that mean? well, that means no one is going to jump in and take some risks here in the remaining time this year that does mean january may see a change the calendar may turnover, you get into the spot of tangible book value and when you look at the prices back then, dividends start to become attractive and even relative to the fed raising rates overall so if you see something maybe at 5% before, now maybe 6% or 7% i think that you can look
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forward with a little bit of confidence that we are not going to see the same sort of activities this market in the last month and you talk about the emotionality that we see here friday was very active i don't think i can remember christmas eve trading day that was quite kbietiquite exciting emotional. >> it felt like the market was closing out preparing for r something really big and bad to happen on the news wire. we can list the problems out there. there is a shutdown and a lot of people think the fed made a mistake and the world and the economy is slowing what's that thing that the market feel like they are anticipating >> well, you make a very good point. it certainly was emotional and it appears to me that having this day off really was just
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what the doctor ordered. it was just something where everybody got this needed moment to take a breath and sort of digest what's out there and elevated selling pressure that we see, want to take the risk off just building upon itself and it seems like that is calming down to me today. what will it be for the rest of the week hopefully it will be stable and we'll start to hold these levels and we can regroup and get ready for next year. if we start to pick up downside momentum like we had earlier, you look at the technical side of these things and some of the markets becoming a little bit frightening. >> you mention ed on monday, th sell-offs we had on williams and tepper on monday, what constitute success here? to close a day or two or close higher than you opened >> i think two things, carl, i
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would say number one is to hold the market at these levels, two, to get the emotionally out of it maybe start to see some of that value come down a little bit, just for the market to be calmer the close on monday, really quite and emotional time where you are going into the holidays, it is really quiet that was not the case. we'll see if it calms down don't you expect for it to spring back before it calms down a little bit we'll have to see it >> gordon, thank you pleasure >> when we come back, signs of the state of the consumers of decent numbers of holiday shopping, we'll get all of that, amazon and mastercard, we'll watch retailers today. more "squawk on the street" on the nyc, straight ahead.
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you know the number by now, s&p is down nearly 5% in two trading sessions futures are green and have improved in the last few minutes. opening bell is less than five minutes away
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invest and volunteer in communities like yours. because the changes we make today... can you hear me? ...shape the possibilities of tomorrow. u.s. bank the power of possible. you are watching cnbc. the opening bell in just under two-minutes coming off the tough christmas eve here in the market the president is talking about stocks being a buying opportunity and calling his treasury a talented guy after discussions of mnuchin's future. >> kind of dialing down on the
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drama. it is interesting, sara, you mentioned that technically we gotten into a bear market level. what i find fascinating is the number of times that the market gotten close to 20% of loss on a closing basis and down it happens in 2011 and 1988, there are folks you can find here arguing with you whether there is a brief market in the 1990 so it is an interesting dynamic. >> what did it close 7 points away? >> for all practical reasons this is the bear market activity my point being it is the index that's a lagging indicator at this point if we are in an instance of a non recession bear market, if this downturn is not predicting the recession, it is a 98 or 87 for them >> a lot of people saw a pretty
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big game it is been flat year over year it has rallies >> six months high there is the opening bell and the s&p at the cnbc realtime exchange the big board, animal planet, new year's day special, akc, national championships dog show. we'll get to detail this morning. we got some data points out of it mastercard, 5-1, year on year is the best six years >> double digit growths in online spending and 5% growth for retail spending. it drives of what we are hearing
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from the retailers and the ceos and even from consumer spending data if this is a consumer economy, the consumer is in great shape the retail stocks are what the overall market is telling you. decent fundamental data and yet ugly actions when it comes to some of these retail names only consumer discretionary stocks which is higher for the month, autozone. >> the other stocks are cyclical in a way because people are not buying new cars. i agree with you if you have confidence that another year or year and a half and two years o f steady growth, all retailers look really cheap. the market is sensitive to peak activity and not good activity may continue >> i think it brings us to the debate how big is the disconnect between the market and the economy? are the market going forward or the fundamentals are just not. we talk to retail ceos
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you don't hear them talk about a sharp slow-down in consumer spending what is this all about >> look, it could be about wall street, how well did wall street do in 2013 wait a second, the economy is not doing so great so it happens. >> we had the discussion on monday to some degree. christmas holiday spending is largely a low and middle income. amazon is your top s&p right now almost 4%. they ship a billion items to free prime through the holiday that's a record for them so expect obviously tailored data >> everything is a record in the secular growth that's nominal gdp growth at the upper end is doing right now it should be what we are seeing and confirmation that the u.s.
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consumer is not rattled. i think there is some thrust of enthusiasm that consumers are over spending. >> a lot of people are looking at the bond market for signals of what the economy is doing you saw the deutsche bank, you are not getting the confirmation, the ten-yr yield for instance, the magnitude of econom equity that's showing. ten-yr have fallen below 2.8%. it is not necessarily signaling the kind of doom and gloom that we are getting out of stocks it could mean that you are starting to get a trillion dollar in of the deficits. >> perhaps >> cash balances are going higher, right? >> for sure. >> you know i think the question extends to market bonds. people are making the case who
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watch this, it was led by equities going down. it did happen in 2015 as well. but, it also may not be the worse signal in terms of some true kind of stress event down the road for the president >> it is not just amazon leading today, you got visa leading the dow. another consumer play as well. a sort of retailer sprinkled among the top ten. there is macy's and mastercard itself interesting to watch i think it was bear today, take a look at large cap internet at names that recovered the best coming out of a sharp decline. they argued, i believe it is -- >> all starts with the letter a. >> activision and alphabet and facebook in there, too >> that was an honorable mention. >> if you believe secular growth companies are still at secular
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growth companies when they're trading at a 25% discounts >> by the way, in the middle of that turmoil that we saw, christmas eve trading there were pockets of strengths and you sa that a little bit in facebook and google maybe some signs which would be worth paying attention to because they have been hit among the hardest and let us into this big drop consumer discretionary and communication services and best performing sector. >> staples >> either worrying or sells that you give up. i did look at some of the s&p stocks that have done relatively better the last three months, gm is up there because by the way took its pain before and intel and some home builders in there.
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you had this rolling punishment of different groups out there and the ones that held up recently, all it means that they got hurt a lot earlier to your point, sara, you could see something start to emerge out of it. just as a general caution. first enormous rally that we get off of these levels is probably not going to tell you much of the longer term of trends or lows just because the market was so stretched that it is almost necessary to snap back pretty strongly >> the most beaten down are the ones leading today to that point, utilities are performing the least positively of the major groups though right now everybody is up. the s&p 500 and the dollar is higher i wonder if you are trying to get a signal that all clear or you know time to buy back in or nibble i don't know -- mike, if you think the fed is making a mistake and we are hearing from big investors, until the fed shows a change in turn of its
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policy that it is ready to pause and stop talking about higher rates, can you get the market to rally? >> yes, two rate hikes it can be in november or december of next year and we can talk about something totally different until we get there >> i think it is bfa today that said they estimate trade is about 6% of the s&p drop >> things are going better no question about it had the fundamentals of the economy do look good you can see these inflicted wounds start to add up with the shutdown and of course a manmade problem. you know with some of these other issues and the ignoring of the global slow down and what's
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happening in china and europe and all these things starting to add up with policy decisions you wonder at what point does it get so bad in the market >> whether the market over extrapolate and we were talking about globally synchronized growth the narrative change is pretty quickly. >> you got that right. >> meantime all 30 dow stocks are green. we are up to 228 let's get to bob pisani. >> good morning, guys. happy wednesday and happy holidays to everybody. 4-1. that's not enormous given a big decline that we have seen but it is a gain. take a look at the sectors, nice to see retailers are up. jc penney department stores are up, too. banks are flattish again
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consumer staples are contributing a little bit and utilities. if you look at the faang stocks, we got a nice rally there. amazon rallies nicely and that's a few big names that are up this year and netflix are rallying nicely. all the faang names are on the occupy side. we talked about dramatically how over sold they are i talked about this on friday. the market is discounting a bad 2019 instead of 8% or 10% growth which is what the analysts have right now. no earnings growth for 2019. the number is 162 for s&p 500. what's the right multiples instead of 15 or 17, it is the multiple for the last two years. let's say slight contraction in the economy. go to 14 and 14.5. do the numbers here. you get to where we are. 23.50.
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the market discounted a rotten 2019 and a deceleration of the economy. that's a lot to deal with right now. what's out there of the big three issues that we keep on talking about, the fed and the rate hikes the fed is signaling they're going to be more dovish. on the tariffs talk it is uncertain. they'll restart in january i can't help but think some momentum to come to some kind of deal maybe not on the long-term technology issues but at least on the tariffs on earnings, forget 8% to 10%. we are talking about 0 to 2% or 4% there is low singles now mattis leaving does definitely raise the stakes and throw in another x-factor there how much is discounted nobody is looking at recessions.
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look at what we got here s&p 500 is down 18%. what's an average decline and the recession. the median 50% more or less in 2008, we had a much bigger decline more than 40%. that was unusual the median decline is about 25%. look at how far we have become, we have become and analysts are out. michael darda had this exact comment. he said an 18.5% drop suggests that the market seems to have already discould wanted the bulk of a recessionarecessionary. nobody is calling a recession. there is abbott here we all know that you can get extreme numbers even beyond here
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in terms of the fundamentals which is what i like to look at and certainly looks like we are at some kind of bottom and discounting for a pretty mediocre of 2019 we are at the highs of the day >> back to you >> let's go to chicago with rick santelli at the cme group in chicago. good morning, rick >> good morning sara well, treasury yield seems to have this pattern. they act pretty well and they don't move a lot, cumulatively, it certainly adds up twos are up one. if you look at july of this year's start, should we close here, the lowest levels that we have seen is 9th or 10th of july christmas eve, we are up just a
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bit. let's look at the 10-yr, that gives you the breath of how much we in verse from that second top of 324 on down any single day there has been a few or double digit moves to the downside 10 or 11 base points. it has been much smaller bites the big argument is the treasury complex is more responsive to the weakness in equities and not getting us a glimpse of the economy. i think we can safely say that has changed. there is definitely a nervousness regarding the outlook in both domestic and global affairs of the economy. yes, we have seen a sturdy market the etfs is a little crazier. this one is the investment grade and it bounced a bit but still, it is turning back down and
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givering up a l giving up a lot of the ground it and finally the dollar index this has been a rock solid trade. even though we are a quarter percent under 97 as you see in the chart. we have been trading around the crown of an 18-month high in a choppy fashion all things being equalled, the dollar has been a stellar performer and i think that gives credence to the notion that much of the actions that we have seen are either fed of the past or fed of the present >> carl, back to you >> rick santelli, thank you. >> when we come bang, a former wells fargo ceo, kovacevich will be joining us. >> best gain since december 3rd and november 28th for the s&p. we'll be back in a minute.
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a four day sell-off before the christmas daybreak, the
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worst december for stocks ever president trump not backing away from his criticism of the federal reserve. here is the president on the latest fed hike. >> they're raising interest rates too fast that's my opinion. i think it will stay they think the economy is so good but i think that they'll get it pretty soon the fact is the economy is doing so well that they raised interest rates and it is a form of safety. joining us is former wells fargo ceo, richard kovacevich. is the fed making a mistake? >> i don't think so. the fundamentals we are looking at the folsoundamentals are good
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we have extreme stimulus the fed has to get monetary policy to neutral. it is going to pursue that despite what the president says. i think they are doing the right thing and i think they signal another two increases in the 2019 which would get us very close to reach what i believe is a neutral. no one knows for sure. we would be at 2.75 next june if they do two more increases and they probably want to take a break for six-month. i think they are doing absolutely the right thing >> i don't know if investors agree with you the stock market fell hard into the fed's decision and hard out of it. what does it tell isn't it tryo? >> i think they did not react to the fed. they reacted to the president's report about the fed and firing of the head of the federal reserve and so forth
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the independent of the fed was a concern. i think that's what really happened i believe if if tfed did not int rates in december, the market would be down further today than it is because it would be a signal that monetary policy is being determined by this president and i can't think of a greater risk to our economy than if that was the case. >> although, dick, from this point on now that the fed has already done one hike after the president's criticism, don't you think it's pretty much free to take whatever course it needs? i guess the question is, if it remains a standoff between market perceptions and what the fed thinks it ought to be doing next year, where is the give in that conflict? >> well, i think this is a trump slump. i think it's the other things that are occurring and the actions that he has take than is
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causing this problem rather than the fed. the partial shutdown and his -- he said he's glad to be responsible for that shutdown, that's concerning the market is obviously the trade issues that are going on are a great concern of the market. cabinet officials and advisers are leaving left and right because of disagreements on policy again, the threats to replace the fed chairman, all of those things, i think, are the main reason we're seeing the market and just the threat of replacing the fed chairman what else is he going to do? and so i think there's just so much uncertainty about all these things that, you know, the market is reacting now, i believe it's overdone i think it's oversold. i think when the fundamentals come out which are already coming out, we have one of the best christmases we've had in
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years. retail is booming and when i think that the statistics come out the first of the year and earnings come after that i think there's going to be -- i think the market will come back. >> so does that mean that you expect or would hope for a reversal of the errors i guess you're saying that come out of the white house or can those -- can that drama continue but along with more high frequency fundamental data like corporate earnings. >> i think it's possible that the fundamentals outweigh some of these things but we've just got to stop. just when we get something -- let's just take, again, the international trade dispute. i think it kind of settled into the market and then all of a sudden we shut down part of the government it never stops it's chaos, chaos, chaos and then the mattis thing. if it would just be no more i
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think would be a big positive and the fundamentals could overweight it. but why would you expect there wouldn't be more because every week, everyday he comes out with something. i think he'll learn from that. he's already softening his fed statements maybe it's not a wall it's a fence. he knows if this market doesn't improve, that's not good for him. >> dick kovacevich, good to get your perspective as always, former as well as chairmrfoon what he's calling the trump slump. >> we're up 162. we'll see if it holds. goldman has gone red "squawk on the street" is back in a moment. shield℠ annuities from brighthouse financial
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welcome back to "squawk on the street." i'm carl quintinilla with sara eisen and mike santoli at post 9
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of the stock exchange. dow is up 70, s&p up about 13.5. our road map for the hour begins with stocks higher this morning but having their worst december ever and on pace for their worst year in a decade the dow and s&p hovering near bear market territory. a breakdown of the buying opportunities and where they exist. the president weighs in on stocks telling investors now is the time to buy but once again criticizes jerome powell more on that coming up. and finding you opportunity in the new year. the names that should be on your radar as we close out 2018. we'll begin with stocks, dow hanging on to a 66-point gain, having the worst december in market history, down more than 15% in the last three months alone, hovering with the s&p close to bear market territory szhau dow is 5,000 points off the record high and the president says it's a tremendous time to buy stocks
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listen. >> we have a normalized interest rate that means -- it's good for a lot of people. they have money in the bank, they get interest on their money. for many years, nobody got interest on their money so i have great confidence. i have great confidence in our companies. we have companies, the great nest the world, and they're doing really well. they have record kinds of numbers so i think it's a tremendous opportunity to buy. really a great opportunity to buy. >> the president did take the opportunity to once again criticize fed chairman jerome powell let's bring in steve leaiesman the president and fed square off here steve, what's your take as we look at an attempt at a rally. >> doing some reporting on that. before we get to the president's battle with the fed, news on economic data. the bureau of economic analysis makes it official that some of its data releases could be suspended. we just got off the phone with the bls.
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they stay jobs report should not be affected because bls funds it over its census, that's more than you wanted to know about data but the department of commerce says there could be delays or suspensions of new home sales, advance economic indicators and construction in the next couple weeks. the fed is fully funded. they don't have to worry about that from congress it announced plans to reduce its balance sheet and the market responded with crickets and for much of that time the fedex cuted the plan to allow securities bought during the financial crisis to roll off its balance sheet. now the balance sheet reduction plan front and center. here's what you need to know we call this this balance sheet happens. f
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qe-1, 2, 357bd goand 3 goes do a half trillion. if you have trouble with numbers, here it is graphically for you. you can see the increase there during the financial crisis, the rollup, qe-1, 2, and 3 and then where will it go by december 2019? the second story is what the estimate on the street is of where the fed lets it go to. that's a bit higher from where it was before the crisis so far, no impact we can see on bank lending from the reduction in excess reserves but the president raises some fascinating questions. should the fed's monetary policy take account for the trade war and rise in the deficit? should the fed keep rates low to help the fiscal authority pay its debts? the idea of the fed being independent is in part so it
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isn't a instrument of fiscal policy but judging by the president's tweets and battle with mr. powell, that's not something the president appears to agree with, guys. >> so is it that the criticism isn't justified? is that the take >> i think the first thing is what -- how much the fed should take account for when it decides what the balance sheet is. is fiscal policy part of what the president should figure out? the second part is where should the fed look for this problem? if you don't see in the lending, does the fed's responsibility end there? does it have a further responsibility to think about what the impact would be in, for example, the equity markets out there if that tiegts ghtening ss
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up there we don't have banks complaining reserves are too hard to find and we don't have banks complaining that the balance sheet runoff is part of a reduction in lending because lending is going up. we haven't seen those problems we've also had a lot of balance sheet reduction and the market didn't seem to care until recentl recently. >> steve liesman, thanks very much for more on the selloff and the interplay with the fed and government, let's bring inrob martin maybe just weigh in on what we've been talking about potentially as this disconnect or this kind of -- >> well, what bothered me about the fomc meeting is they didn't
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seem to be softening in the data the statements on the economy were the same as in eptember, they don't see any hint that running off the balance sheet is causing problems in the economy and they don't see risks from financial markets. they're not taking a signal from this 20% down market we have so that sounds tone deaf and raises the concern what would it take for them to pause. what are they looking for because they react ot the data. >> do you think that is what the market is doing? trying to dare them? test how far the market can fight the fed? >> i don't think the market ever really fights the fed. what we're seeing, though, is markets reacting to the strains from tariffs we see big effects from tariffs rolling through. we're seeing people reacting to a fed that doesn't look like they're going to react to the da
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data. >> why would it be short lived if there's no deal and we go to 25%? >> we assume 25%. >> that's a big bet. >> it's have been uncertain around that. we think we're seeing manufacturers in the united states shutting down and shortening hours in response to the tariffs. that supply chains are getting hit. as those strains go away with the tariffs staying there, growth picks back up the underlying economy is still strong. >> we spent a lot of 2017 trying to explain how the markets just didn't seem to care about what was going on in washington the feds was in tightening mode. you also had chaos in the white house so now all of a sudden it matters when the market is in a weakened state where do you put cause and effect >> you can layer a certain amount of uncertainty into any market and see it rise as long as earnings were progressing nicely which was 2018 and much of 2017 but we hit a breaking
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point with these issues all at once when tech rolled over in october and we need to make tax law sales in december to tull the rest of the market in. that's what's happening right now. the trouble is there's no horizon to see any one of these individual topics resolve themselves in the next 20, 30, 40, 50 days so we're probably looking at maybe a tax loss rally, a january affect in january but not follow through after that until one or two of these things gets resolved >> but some would wonder what is the market pricing in? bob said is it pricing in a recession at this point and is that fair given what the data is telling us >> we're looking at 14.5 times reduced -- maybe $162 a share on the s&p which is flat to this year, i.e. not a recession and i think it would be tough to pay more than 15 times given the uncertainty we're feeling now so it doesn't feel like we've
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priced in a gdp. >> how depressed would asset prices have to be and for how long for it to self-fulfill. for 116 to be at risk? >> we're flirting with that right now. >> absolutely? >> yes because if you talk to individuals as rob mentioned, you're seeing people pull back on spending. budgets got settled on right now. our company will be aggressive in the first quart we are hiring or expansion or investment given the volatility in the market doesn't'll be like it. >> we haven't seen a reck reit is pop in claims is the calendar weird right now? >> super weird for claims. everybody is coming off holiday hiring so january will be important to watch. >> we've had growth squares before we've seized up in advance of potential downturn in the u.s. economy. where do you see the underlying economy going in 2019? are we going to be individual for a recession in 2020? >> i'm going to split 2019 into two halves the first half is risk from
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tariffs, extra risks, cheap oil is a big risk right here right now so that first half drag but if you can get through that without a recession and the underlying bones of the economy show themselves and growth picks back up. >> how did we get to a place where everything is being interpreted as bad news. even if it's maybe not necessarily on the surface bad news i'm thinking look, there was a lot of hand wringing over the treasury secretary's press release that he spoke to six bank ceos about liquidity and maybe it was a botched communication things and they should have said this was a routine call about the economy and some of the action in the markets but it shouldn't have changed anything materially for the markets. they aren't worried about liquidity. so i guess how did we get to a point like this and what do investors do when everything like that is getting blamed and spiralled into this negativer e in -- narrative. >> the question is how deep the
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bench is in the president's administration and when you see mnuchin come out with what i would agree is at best a good will gesture but not very well thought out press release that creates some pause we've seen this market discount headlines two and three and four days ahead like for example with the huawei cfo arrested. the market tanked on tuesday, the arrest was announced on wednesday. so we hear from clients all the time how much is the it that correct we feel people are getting a better call. >> one last question if we can assume powell is safer from any outside pressure, if mnuchin is let go, what does the market do? >> i think that the administration has a lot of turnover at the moment there's a lot of risk and uncertainty out there. i think losing the treasury secretary would alleviate it. >> have we seen enough departures that it would be another one. >> unless the headline is jamie
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dimon takes over, more to. >> all right, guys, happy new year. >> happy new year. when we come back, stocks rebounded and the rally lasted 36 minutes before the dow went red. the s&p coming out of bear market territory and the president saying now is the time to buy stocks. but should you we look at levels that are important in the next few segments. also an update on ta areils the holiday shopping season wraps up we'll look at winners and losers and names to watch in '19. that's coming up next. shield℠ annuities from brighthouse financial
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dow started the morning with every component in the green, now more than half are red, led lower by goldman sachs discounts, rueturns and gif cards, the day after christmas generally as busy as the one before the holiday we're live at the woodbridge mall in new jersey with more on what's in store for today. >> it's early. not a lot of people behind me but they will be coming in all day. shopper track projects the day after christmas to be a top ten shopping day for the entire year so it will be a busy day coming on later today the three big reasons, like you mentioned, the three traditional reasons why you get in here, you have a lot of discounts so it's a good time to buy things. people have gift cards they got yesterday, they want to spend gift cards but don't wait forever, a billion dollars goes
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unused on that gift card and finally people have a lot of stuff to returns ugly sweaters, pajamas people don't want, that will happen here today but here's the thing. while the stock market has been going down, we're seeing record data points coming out of the retail sector. whether that's amazon or u.p.s. or the latest today, the mastercard spending data showing record retail numbers on online and in store we're going to talk to people when they get in here why they're coming is it to return, to buy or to use the food court i know you're working downtown so if you have anything on the shopping list, let me know, i'll get it back for you while i'm here today back to you in exchange. >> eric chemi manning the mall in woodbridge, new jersey. sales jumping 5.1% between november and christmas eve according to mastercard. stocks telling the opposite story. losses outpacing the broader market, falling nearly 25% which one is the right narrative
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for resnail joinitail former sears canada ceo and columbia business school professor mark cohen mark, is there something that justifies the ominous stock moves? >> 5.1% is the best holiday season in six years but the tale of the tape waits until february when gross margins and expenses get tallied and we've seen a whole host of warnings on margins and expense driven by the degree of discounting and the expense of shifting to e-commerce so we ought to hold out on pulling out the corks. >> do you disagree simeone
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>> you have a pair of grinches here mark and i were talking about this the group of companies we look at had the best sales growth in years but it also had the most sg and a growth, expense, in years. that won't stop. and the expectations that people have for the following year came down the most. so what that means is we have the sentiment versus fundamental conversation which we talk about that people had embraced this idea that retail was back with a reason is jens retail was the best sector you could imagine which was ironic because it had apparently died beforehand so it feels like right now figuring out where we'll normalize, we went too far to the negative, we are going too far to the positive. the sales will be here. >> you're saying this was a profit list sales boom people are seeing at retail >> this quarter you have gross margin we've spoken about the idea that there's more inventory on the there are than people might appreciate when there's inventory on the
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floor you're forced to discount. so right now you've been spending on the expense side and we've seen different pieces, labor, there's different components things can be good for the environment but bad for specific retail next year we find gross margin become more challenging. >> on inventory i remember asking this on black friday, whether people pulled forward to get more on tariffs and it ended up in a bloated promotional environment more than necessary. did that happen? >> it had to happen. if you have commitments overseas on goods that are likely to cost more money, 10% 15,%, 20%, 25%, you have to be crazy not to bring them forward from a pure economic point of view of course there's a tremendous price you pay for logistics and all of that but the biggest issue is not just bringing inventories forward, it's not knowing where these tariffs are going forthe going or if these tariffs are going. so there's a consequential
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threat to retail which is the shift to e-commerce which creates distortions and then there's the existential threat which is the specter of these broad-based tariff which is could drive an enormous array of consumer goods up substantially starting in early second quarter. >> simeone, you describe this pendulum swinging, right, from people being too dark then too optimistic now swinging back what kind of companies are best positioned for wherever this settles out right now? who's spending the smartest if everyone has to spend more >> generally speaking, the brands will have power so the -- i would say the sequence of events in stockland was multinational brands that would have to deal with tariffs, have to deal with global uncertainty and demand took a massive multiple beating u.s.centric complacency around the domestic level of comfort came later so we've seen that catch back up to itself and the
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u.s.-based names take a hit. i would argue it's multinationals that will be better equipped because as everyone has to deal with the same issues we probably got too comfortable? >> who >> michael course, tapestry are companies trading at meaningful discounts to where they were nike took a wash over the course of the past month. you saw a little bit of a rise when they put up what looked like a flawless quarter. so you take the brands and we're dealing with department stores that are trying to figure out what their existential reason for being is and we have this discrepancy where the off-pricers which have gotten quiet even though tj ross, burlington were the companies the most touted for a while, that discrepely is continue. when we hear about stores and brick and mortar doing well, that's them. >> mark, would you stay away
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from the old department stores >> the department store genre is dead whether they have a heart beat for the next year or two remains to be seen sears is gone. i think j.c. penney will be circling the drain. >> they're figuring out the online business and how to make their stores more of an experience aren't they >> they say they are but if you visit their stores outside of, for example, herald square, you don't see much evidence of that. they're going to tout this enormous increase in e-commerce business of course they're not rigged for that business. i want to point something out. when a customer shows up on december 26 with an ugly sweater and looks to return it, a good percentage of those customers will swap that out for something they'd rather have but when a customer returns something they bought online, that's it. it goes into a black hole and the retailer has no recourse except to liquidate the goods somehow so this shift into
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e-commerce isn't working well because they haven't reset their real estate portfolios a 20% lift in e-commerce if mastercard is right is a massive shift once again toward a channel that didn't exist 10, 15 years ago. >> and those return cans end up in the off price channel so if you think about where you have this product that doesn't create the swap, it's another reason to find that treasure hunt. >> i did notice the "journal" has a piece of these toys "r" us locations that are selling pretty well. it's all health care facilities and auto dealers. >> discounted leases on big boxes. >> malls are changing. you have these massive boxes -- think about it from an anchor. if the genre is dead, those are enormous boxes that weren't paying rent so from a land lord's perspective, you can get creative, it's not the worst thing in the world. >> we'll leave it right there.
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mark cohen and similar monoseeimon -- simeone siegel, thank you very much. the dow up 65. s&p 500 up half a percent. nasdaq up almost 1% the vix remains over 35 so a fragile volatile take. as we go to break, look at the best performing stocks in the dow. nike leading the way
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we've had 300 point swing in the dow and it's barely 10:30 east coast time. we were up 232 dow is now up 71 points on headlines out of white house advis advis adviser hassett saying that powell's job is 100% safe so we'll see if that provides the bulls with confidence. time for etf spotlight bob pisani is looking at the best and worst performing sector etfs as we close out the year. >> it's tempting to say it's been a bad year overall but there's a wide dispersion in
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performance, unusually wide even by the high volatility standards of this year let's look at the underperformers. remember, you can only these sectors just by yourself i put up the stock symbols there as well energy, of course, much of this decline has come since october we were close to $70, went to $45 on the global oversupply concerns that's been the big thing there. banks have been underperformers throughout the year on flatter yield curve and modest loan growth expectations and materials and industrials have moved very much together on the slower global growth and trade concerns but if you look at the the other end, it's been remarkable how far. it's rare you get 20%, 25% differences between high and low sectors out there but we are getting that this year so utilities, no big move up in rates, particularly long-term rates have helped utilities. health care, we had hmos and big pharma like merck and pfizer move up nicely generic drug makers didn't do very well. very wide dispersion in health care
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tech, we had all over software did very well in 2018, cyber security was flattish, hardware, semiconductors, generally they underperformed consumer discretionary, amazon up almost 25% at one point, 30% at the highs here. that helped a lot as well only down 7%. the big story in 2018, i have to say, in my number one pick was the return of volatility and you can see what happened here we often put up the low volatility etf which is stocks like coca-cola and pepsi and the utilities against the hie beta names which are stocks that move more when the market moves and those are mostly tech stocks so applied material, micron, microsoft, facebook, etc there you see the orange line there. we were even until the beginning of october when we had a big pickup in volatility and that's when things started going south for all those high-beta names for the microsoft, the facebooks, the amazon, the amds of the world, you can see more
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sideways on the white line, that's low volatility names but in the last two weeks, rather interestingly, there was a big selloff in the low volatility names and i think these are people who were out perhaps having to go out and sell some of the winners on the year because some of those were definitely winners going into big decline. that's a sign of how stress it feel overall market is we'll do a couple more reviews on individual subsectors in the following days guys, back to you. let's get to frank holland and get a news update. here's what's happening at this hour. an earthquake triggered by italy's mt. etna vock caulcano n people to run from their homes there were no nay tillties ruth bader ginsburg was released from the hospital on tuesday and is recuperating at home. the 85-year-old justice spent
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five days at sloan-kettering cancer center in new york following a procedure to remove a cancerous growth from her left lung no further treatment is planned. and sales during the holiday shopping season rose 5.1% to over $850 billion in 2018 according to mastercard, the strongest in six years the data includes in-store and online sales between november 1 and december 24. and there was no big winner for the megamillions christmas night drawing. it was only the fifth time there's been a megamillions drawing on december 25 the next is friday night with $348 million it hasn't been won since october when it reached a record $1.5 billion. that's our cnbc news update for this hour. back to you, sara. >> i remember, you were all over that story, frank, thank you still to come, much more on the markets as we are set to close out a rough year for stocks is the decade-long bull market
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over where should investors be looking right now? dow early rally fading "squawk on the street" will be right back
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welcome back, i'm sara eisen with carl quintinilla and mike santoli at post 9 at the new york stock exchange. it's been wild already let's get a check on where we stand. the dow is up 17 points. not as much as it was up before. 282 at the highs of the session. still on track for its worst month since 1998 and its worst december ever.
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s&p 500 up a third of a percent. you have pockets of strength like communications services and attempt at a rally in the faang stocks for technology but financials, utilities and materials are all lower. the nasdaq outperforms up a little less than 1%. markets are struggling to hold on to the rally as the ongoing uncertainty continues to weigh on investors let's bring in jared bernstein, senior fellow at the budget on policy priorities and policy adviser to vice president biden and policy analyst at the american enterprise institute. good morning to both of you. jimmy, hassett on the tape saying powell is 100% safe could that clear up muddled messages >> i'm always reminded of when a baseball owner says they was full confidence in their manager
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and then they're out two weeks later. more important than what kevin hassett says or what mnuchin says is the president and rather than what the president says, he needs to stop tweeting about the fed, stop tweeting about powell. less tweeting overall would be great. every time the president tweets about the fed it will remind people he's -- obsessed on the federal reserve and that's bad for confidence. >> the president hasn't mentioned firing jay powell and now we're hearing from an economic adviser and we already heard from the treasury secretary that the president doesn't have an intention of firing powell. how much of a risk is there? >> i liked what kevin said and i want to believe it but jimmy is right. there's obviously a volatile
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president that won't stop tweeting about the fed a lot depends on the underlying economy. trump's response is an obvious reaction to slowing particularly in the global sense and the markets and i think here -- i think the strong american consumer is a bigger deal at least in the near term than many people are recognizing, you played the big retail numbers. in fact, we're a 70% consumption economy, in europe that's 55%. we have increasing wages, inflation has been tame so real earnings up soy think the strength of the american consumer will -- >> but that's built in wages are good, oil prices are low, savings are okay but what happens when we start getting
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quarter after quarter of gdp reports that don't begin with a "3" they begin with a "2" maybe a few with a "1" that's not what the president promised and i think we'll get a tweet storm. >> i think jimmy is making a great point. as the fiscal stimulus fades, you'll see two handles instead of three handles so this is about how you handle a normalization coming down off what i think is largely a sugar high down to more trend growth rat rates. >> gas prices will come down the lowest we've seen under the trump presidency and if consumption is good, why does not that not give the fed cover to what they said they'll do already? >> well, listen, i'm -- i have no problem with the rate hikes, we have a normalization process happening. maybe we see a couple more
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that's fine. people should not be freaking out. if this economy is as strong as i think it is, we should not worry about the market we don't want the president to be a day trader or market timer. we don't want the fed to be a day trader or market timer so, listen, there's freaking out going on it's been super unhelpful. a lot of talk about what would calm the markets, perhaps, is a softer town on china and tariffs. on the other hand, the president seems fixated on making good on campaign promises. so do you think trade is a bit of a flex point here potentially? >> i think you're hitting on something that i wanted to emphasize in this conversation so thank you mike for bringing it up. i think when economic historians look back on this time they'll
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look at trump's trade protectionism as a much bigger factor in really upsetting the economic apple cart than many people might have thought. yes, we're insulated from trade in this country with our imports, 15% of gdp. that's way lower than any other advanced economy but i really think that that is the crux of uncertainty, of a sense that the administration is untethered when it comes to being a responsible player in the international economy so, yes, that is -- even though i've been optimistic when i talked about the american consumer, if trump continues on this aggressive trade war as i expect him to do that will be a negative. >> if tariff man became trade man that would be a big plus end the shut down, show wall street there is some actual process with how decisions are being made that's where the mattis thing comes in the whole thing looks kay yot
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psychoforget about uncertainty, how about confidence that's a great word. let's show confidence we have a government that works and processes are followed and we're not making rando decisions here. >> i wanted to go to the shutdown the president has owned the shutdown but i'm not sure if it hurts him politically until we get maybe economic damage? what is it >> at some point i imagine this is going to go into january. the democratic house will pass a bill to reopen the government, then it will be open to republicans. i'm guessing the end game is that the president loses, tries to paint it as a win but he could dig in his heel, leave it shut down and this could -- hi he's ready to do a long shutdown, maybe we have to take him at his word. i think the polling shows they don't want it. it looks dysfunctional and it's
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another screaming signal to wall street that washington cannot get things done and while we like to say gridlock is good, sometimes it isn't. >> there's a lot of topics to tackle during this week, guys, and we're glad you're helping. see you soon thanks >> stocks trying to rebound this morning. the dow is slightly negative the s&p 500 up 0.2%. tech is the strongest piece of the market facebook rebounding, ndaq asup two-thirds of one percent. when we come back, the president's former economic adviser judy shelton will join rick santelli. stay with us (toni vo) 'twas the night before christmas, and all thro' the house. not a creature was stirring, but everywhere else... there are chefs, bakers and food order takers. doctors and surgeons and all the life savers. the world is alive as you can see, this time of the year is so much more
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market strategist jim paulson who called the recent downturn says stocks could retu tthrno e highs in the half of next year find out what he's watching on tradingnation.cnbc.com more "squawk on the street" is coming up.
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♪ ♪ ♪ ♪ what if we could turn trash into money? plastic bank is doing just that, by exchanging plastic for digital credits redeemable for everything from food to education... powered by ibm blockchain. when you understand the potential of new technology, you can put smart to work. let's get to the cme group and get the santelli exchange.
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hey, rick. >> hi, carl. thank you. i'd like to welcome a former trump transition economic adviser and current u.s. executive director of european bank for reconstruction development, dr. judy shelton. judy, thank you for joining me this morning. >> thanks for having me, rick. >> all right i'm sure you're aware of all the talk and activity since october regarding not only domestic markets but global markets what do you see as the several largest reasons why there's so much volatility and nervousness with regard to markets >> well, my first job out of college was a stockbroker so i learned a long time ago that markets can be unpredictable and anyone who thinks they can explain why they're going one direction versus another is faking it a bit. i think there's a serious disconnect between the behavior
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of financial markets and the underlying real economy can which is in good shape so the market is in a mood to amplify every conjecture it's super sensitive >> there's some obvious things that maybe we should underscore than we do in the media. say in've nev they've never had to take the beginning of a bear market or large correction but the biggest reason, a simple saying -- a chain is only as strong as its weakest link these are big looming issues, are they not >> i think the automatic trades are exacerbating the extremes.
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we're seeing the effects of reversing the quantitative easing you reap what you sow when you push up money supply to create the illusion of wealth it can go the other way when you're trying to bring it down to some kind of normalization. it's very difficult to normalize when you've had a distorting effect on the economy. >> i believe along great research by jim bianco that the cumulative stimulative effects of all central banks reached a tipping point in early okay. the bank of japan owns 30% of their own etf structures in japan. we see the europeans still have
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negative interest rates along with the japanese. could at no time market also be nervous not only about general policy but all the tidal wave, the reversal of those policies ultimately send? >> that's been a negative consequence of this whole exercise in monetary expansion it has elevated the role of government into the private sector and i think even now the fact that the market just hangs on the most subtle nuanced statement of from a central banker just tells you to that we've turned the handful of people who have some influence over interest rates into something like the wizard of oz, the great and powerful and it distracts us from the fact that the economy is so much more than that the real economy is people working and it's the creativity and there's so many good things that are helping the real economy, like the lower taxes and the less regulation.
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we need stable money and i think that you would -- free enterprise would cultivate and unleash all of the entrepreneurial zeal that is still out there and we're already seeing in the a strong growth rate so we can't judy, t your thoughts. i remembered many times in the past where wall street felt one way and main street felt another. i can't wait to see the retail sales for the holiday season. >> they'll be good. >> yes sara, back to you. >> talking about that seeming disconnect all morning long. rick, thank you. when we return, speaking of retail, we'll take a deep dive into the luxury sector, from high-end real estate to art to stocks will the slowdown for luxury accelerate or taper op in 2019 and what will the impact of volatility and trade tensions 'lge china be? wel t you a playbook for luxury after the break, stay with us. duncan just protected his family
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welcome back to "squawk on the street," i'm leslie picker stocks are attempting to rebound today but losing steam in late morning trading following monday's sharp sell-off. the dow has erased a 282-point gain as volatility continues on wall street. despite the pullback,
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consumer discretionary stocks are outperforming. that sector, though, still firmly in bear market territory, down more than 21% from its recent peak in late september. among the names leading that group to the upside include department stores kohl's, nordstrom and macy's boosted by strong retail sales nationwide over the past month. finally take a look at shares of amazon, up more than 2% today on the back of its record-breaking holiday season and on pace for its first positive session in the past five. now i'll send it back downtown to you guys. >> all right, leslie, thank you very much. it has been a rough year for high-end luxury stocks, with names like tiffany, tapestry all down for the year. is there upside to be found in 2019 robert frank has the playbook for luxury stocks. robert >> well, it was the year of worried well as markets in high-end real estate took a fall but next year could be even
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worse. first, luxury is losing its shine, from jaguars and jewelry to bags and brightlings, the showdown in luxury spending will accelerate china is the big reason but volatile markets could also drain the confidence of u.s. spenders second, big mansion discounts. the pressure is on high-end real estate will grow with oversupply, fewer foreign buyers and those tax changes. look for big price cuts, especially on spec homes in new york, california and other high-tax states. those are going to be the hardest hit. while lower tax states like florida could be a bright spot. and lastly, weaker wall power. the art and collectibles market has so far escaped damage, but if markets continue to melt down and growth slows, wealthy bidders will hold back their paddles on the biggest trophies in 2019. >> that's our robert frank on
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next year. sara, we're going to see you at 3:00 >> yes, we have a full day of trading today. boy, has the 3:00 hour been volatile i think we're all a little traumatized by what we saw at the noon hour on monday in what turned out to be the worst christmas eve ever in performance for the stock market the rally has totally faded. we've lost the 272-point gain on the dow and now heading south again, down 70 we'll talk to tom mcclellan about the technical levels to watch. he told us last week apple is a key tell for the market. apple is higher today. >> see you at 4:00. >> you'll be there as well we'll watch the close. coming up on "squawk alley" the 2019 playbook for tech with the sector down the last three months is now the chance to get into some faang stocks? is that a smart move the dow down 58 as oil is up $2. we're back in less than three minutes. shield℠ annuities from brighthouse financial
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from capital one.nd i switched to the spark cash card i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet? good morning it's 11:00 a.m. in washington on day five of the federal government shutdown. it's 11:00 a.m. on wall street, and "squawk alley" is live
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♪ ♪ good wednesday morning welcome to "squawk alley." we're here at post 9 of the new york stock exchange. morgan and jon have the morning off. an important day to watch stocks, trying to bounce back after suffering the worst christmas eve trading session in history. the dow was up as much as 282 points at the high today, s&p and nasdaq down from their most recent intraday highs and the dow still on pace for the worst december since the great depression "the new york post" is calling it a

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