tv Power Lunch CNBC February 8, 2019 2:00pm-3:00pm EST
lot of people in for a nasty surprise but the good thing is this the laws we have now are basically going to be the same until 2026 there's a small change here or there but what you see this year is what you expect going forward. >> i'm sure it's good for your business jeff levin, thank you. that does it for "the exchange." i'll join tyler and melissa on "power lunch" which begins right now. >> see you shortly i'm melissa lee with tyler mathisen new at 2:00, stocks sinking again. keep buying on this dip or buyer beware growing concerns ahead of next week's crucial trade talks with china. what's the state of play amazon in the spotlight. jeff bezos' accusation of blackmail and word at new headquarters in new york could be in jeopardy all the details. "power lunch" starts right now >> melissa, thank you. welcome to "power lunch.
i'm tyler mathisen major average is down now for a third consecutive day. that's the first time that has happened so far this year. we are, however, off the session lows as you see over my shoulder at one point, the dow was down 286 points goodyear tire and hasbro among the worst performing stocks today and got more on hasbro and troubles in toyland ahead. in the meantime, let's get straight to what's driving the slide at this hour bob pisani tracks the action from the new york stock exchange bob? >> hello, friend three things move the market global growth, the federal reserve and trade. two of those issues were in the news today let's just take a look at the s&p 500 in the middle of the day. i want to point out before noon, eamon javers of washington said a senior administration officia said the march 1st deadline could change slowly lifting off of that and that would certainly be important because the market believes it will be tough to get an agreement in the time frame another thing killing us, slower global growth.
it's just killing our earnings estimates. for the first time in several years, growth is negative for the s&p 500. earnings, i'm talking first quarter at 0.1%, still positive for the full year but even that is slowly trending towards zero. that's the major headline today. finally, keep an eye on fading leadership in the markets. we had a roaring start to the stocks and oil now today, oil stocks down are today and all week some of the big names you see down 10% overall guys, back to you. >> bob, thank you. bob pisani much of today's declines fueled by fear over the trade fight between the u.s. and china top negotiators on both sides getting ready for crucial meetings next week in beijing and the key deadline could be moved. kayla tausche is in dc with the very latest. hey, kayla. >> the next week delegation led by u.s. trade representative with steven manuchin and then as
for the march 1st deadline, white house officials expect the president to signal tariffs will not escalate so long as talks are progressing as we have reported that would essentially render that march 1st deadline null matters could be complicated by an executive order that the white house is expected to release in the next couple of weeks that would widen the ban on huawei and zte technology its release could tie the hands of companies buying hardware and deepen the divide with internet companies in the western hemisphere versus the east here's ceo chuck robins. >> i don't think getting to some balkanized internet is the right answer because so many things we can do with the technology are going to require us to maintain connectivity which is why we have to get the cyber security stuff right and the trust right and, you know, notwithstanding
whatever different governments think about technology providers. >> the u.s. has long said that huawei from a national security sfe perspective is a separate track than the trade negotiations but the chinese could see it differently. >> kayla tausche in washington stocks down for three straight days now. "mad money's" jim cramer is warning about running in to buy the dip. >> it's realistic to expect a couple more sessions like this one until the facts get more positive so until we either get lower prices or a brighter outlook, i think should hold off putting any new money to work until we get to safer levels. >> at the same time, bank of america merrill lynch said investors keep going for now and buy the market drop. what do our guests think rich weisz, chief investment officer with american century investments. we'll tighten up your title
there a little bit i can't even pronounce it. ron insana, a key adviser to schroeder's, a global asset manager. would we be surprised after the kind of comeback in january that the market is taking a little bit of a breather? >> dramatically oversold to pretty overbought in a relatively short period of time and january was as strong if not stronger than last year, so it was a pretty fast start out of the gate this year valuations, obviously came down a lot but as bob pisani was suggesting, we're seeing an issue with earnings estimates being lowered fairly dramatically and that's a head wind for the market as with the china trade talks. earnings are not growing >> not growing, absolutely with estimates coming down, it is easier for companies to beat expectations, but we're coming off, as we start talking about last march, maybe peak profits and peak profit margins, that's for a long time. >> i'm sure you heard kayla and
others report that it seems at least a little less likely that there's going to be some kind of comprehensive deal on trade as of march 1, but that there may well be a citation of enough progress being made to postpone the escalation of tariffs or the introduction of new tariffs. would that kind of outcome be enough to let the market move up from here? >> it will help, but it's not going to turn this ship around at this point. global economic deceleration economically speaking, you have negative earnings guidance you have an inverted or kinked yield curve and anything inverted or kinked in the financial markets or in life is never a good thing i think it's really -- >> in life >> in general. it's really hard to see the bottom from here we're looking for a little more clarity. trade talk, if there's some good news there, that might give a
pop to the markets in the short-term but it's not going to deny the direction of this economics. >> how the hell did we get in a year's time from everybody cheering and talking about global synchronized growth to where we are today >> it's been a long time coming. i mean, we had a nine-year economic recovery coming out of '08 and a bull market run. it's the return of the economic cycle. you know, i'm not saying we forecasted it with precision but we knew it was going to come at some point and now we have it. and it's not the case we're necessarily looking for parts -- >> a year ago, i don't know if you were but not too many people were. >> fortunately for us, we took our foot off the equity gas pedal early last year, arguably a few months too early but well positioned in our target date fund and other stock funds for the turn and we remain that way. we are not buying on the dips.
we're not going to catch a falling knife here >> is there risk to the upside when it comes to earnings estimates and i ask you because we see revisions done in the face of concerns about tariffs, et cetera, should we get a deal that could theoretically spark some more optimism in terms of what people or companies see from their outlook >> then it's back to beating lowered expectations which becomes easier for corporations that were exposed to trade on the flip side, melissa, when you look at global interest rates falling in germany, 0.002% yield on japanese government bonds. rates falling everywhere in the world including here in the united states. >> here. >> which is somewhat unexpected given the stock market rebounded dramatically and rates gone down in the same period the bond market's message may be stronger than the stock market's message particularly when it comes to global growth which seems to be slowing almost everywhere. >> have a great weekend. ron, rich, appreciate it shares of amazon getting hit this hour. the company now reconsidering
its second headquarters in new york city in the face of so much opposition that's according to "the washington post" which, of course, owned by jeff bezos. deirdre bosa has more on this one. deird deirdre? >> advocacy groups long opposed the long island city project including high profile names like u.s. rep alexandria ocasio-cortez and why amazon, a multibillion dollar company needs billions of dollars of incentives but governor andrew cuomo and mayor bill de blasio who fought hard for the project say that economic growth, that the project promises, will be worth it cuomo today responding directly to the latest report from the "washington post." >> you know what the incentive package was? we get 27 billion in revenue they get 3 billion back. we get 27, they get 3 billion
back i would do that all day long >> now, opposition from local politicians in new york stands in contrast to the amazon project in virginia and tennessee. officials are embracing plans. in new york though, amazon has not yet leased or purchased office space for the project and that could potentially make it easier to withdraw if amazon does go that route >> deirdre, there were lots of people, local stories about people buying real estate on the back of this project coming thinking they were going to make a killing. you know, just a small kind of asterisk on this but i wonder what happens now if amazon does really pull out. >> absolutely. i mean, billions of dollars in incentives were promised to amazon, but amazon also was expected to increase economic growth and give back by de blasio said, nine fold so that could change plans for a lot of people. a lot of people could lose money from this if amazon does back out but i think we're far from
that point still we have to see what the response is. >> deirdre, thank you. deirdre bosa not the only reason that amazon is in the news today jeff bezos taking his fight "national enquirer" public saying he's being blackmailed for intimate photos. is this a big distraction or sign of bad judgment back to that and then first, mattel soaring thanks to barbie and hot wheels but which is the better buy right now stay with us when you look at the critical issues facing our world, what do you see? we see breakthrough medicines getting to patients in record time. we see harnessing natural gas unleashing the promise of clean energy. we see engineers simulating the future to improve today. at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility.
click or visit a retail store today. it's a tale of two toy stocks mattel on the back of the earnings beat fueled by strong barbie and hot wheels but hasbro claiming the liquidation of toys r us disrupted the holiday quarter. eric handler at mkm partners great to have you with us. >> thanks for having me. >> how much more of a head wind will the toys r us bankruptcy be for the toy sector in general? clearly, we see the impact in hasbro and we did see the impact in fischer price with the mattel results. >> good news for the toy industry right now is we've gone through the worst of the toys r us liquidation and comparison, should get a lot easier from here on out. that's good news for the
industry which really went through a lot of anomalies that were quite unusual for the industry last year >> is that going to be good news for hasbro >> i think it's going to be excellent news for hasbro. you think, first of all, when you look at the industry right now, good news for both companies. right now, retail inventories are very low there's a lot of shelf space around right now so that's good there's not a lot left to liquidate. and then, you know, i like hasbro, i prefer hasbro to mattel right now, got a buy on the name and my view when i upgraded the stock back in august is when you look at the product lineup for hasbro in 2019, it's a really strong lineup of incremental product lines. you've got, this should be a big up year for "star wars." you've got "frozen 2." you've got the live action dumbo, ualaddin and line king movies, incremental marvel and then magic the gathering arena, a new digital product starting
to roll out globally >> and, you know, in terms of the disney tie-up brand, frozen, "star wars," marvel, how do you think about the direct to consumer offering and that sparking further demand for the related products if disney is going to spend money on original content which may be related to "star wars" and that franchise, for instance, any sort of catalyst for toy sales for hasbro >> i think it's a very nice incremental catalyst for hasbro this year in particular. disney plus is going to be rolling out a new "star wars" tv directed by jon favreau and not only going to get "star wars" episode 9 this year but the last of the skywalker trilogy but have incremental tv content as well so "star wars" should be a very strong product this year. >> i'm curious about the loss of toys r us and where you think the next main key distribution channels are going to be how long is that going to be
sort of a hang over the stock? >> well, look, you're already starting to see some replacement. you've seen a lot of non-traditional retailers get into the business over the holiday season a lot of them already called out toys as being very helpful to their holiday season, but don't forget, there's this little company on the internet called amazon that's been taking a lot of market share over the years and they should be doing very, very well in the toy category in the near future. >> eric, what's the future of toys >> well, as long as people still have children, i think the toy category is going to be doing very well. it's not a high growth industry but a mature industry and a lot of growth coming from the merging markets but it's still a modest growth business. >> i guess what i'm driving at is the idea that there are age brackets where toys are very, very popular, but increasingly,
kids are playing with ipads and other digital things as well and these companies, to my knowledge, are not heavily represented there. >> hasbro does have a modest presence in the video game space mainly through mobile and now on pc with magic the gathering arena. you're right there is kids at a younger age getting involved with video games. the whole fortnite sensation but the toy industry has remained stable and showing some modest growth, so it's always going to be there there are evolutions and there are cyclical ups and downs as products get introduced, but at the end of the day, i think parents still want their kids to be, spend some time away from the various screens and toys are still going to be there time after time >> eric, great to speak with you. thank you, eric handler of mkm >> thank you very much chip sector etf going for
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welcome back to "power lunch. it's been a wild week for the chips. smhetf semiconductor group poised to break the longest winning streak since august. this is names like nvidia and other earnings next week how should you play the space from here? with us now is craig johnson almost a year ago now. >> so the smh already reversed the downtrend. we see a good support. we think heading back towards the old highs and retest those again, i think when you look through the charts, the kem conduct -- semiconductors face, so many
names made double bottom lows in november nvidia, a little bit of a heartbreak but when you report results on valentine's day next week, i don't think you're going to be breaking any hearts from here expectations have already been reset and i look at this stock and a decent low set at this point in time. it's a good risk/reward from our perspective. >> how do you feel about this group? they kind of led the market lower with a few months lead time are they based or heading higher from here? >> i have great perspective from craig's work but have to take the complete opposite side of this trade the semis, obviously, leadership for years and i think that that is over. they led us to the downside. right now, it's just a battle and it's a battle that i want no part of. i don't disagree that nvidia will bounce on the earnings. they've been absolutely demolish bud still trading at 20 times forward earnings and those are negative the trade i'm looking for on the next reversal lower for these
guys is broad. they broke out recently, bulls are getting too excited over this and i'm looking for reversal because the stock is still too rich in my opinion i'd be looking to get short about 255 on broad come he here no touch sector for me. >> no touch on one side and grab for the stocks on the other side thank you for the conversation today. craig and quint. for more "trading nation," head to our web site or follow us on twitter at @tradingnation. back to you. melissa? blackmail bombshell. amazon's jeff bezos accusing the "national enquirer" and take you inside john henry's $25 million florida mansion and the small but mighty small cap some five star picks when "power lunch" returns. >> and now, the latest from tradin
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hi, everyone i'm sue herera here's your cnbc news update at this hour. president trump leaving the white house for walter reed medical center for his annual checkup. declared to be in excellent health after a test. this year's exam will be overseen by his physician sean connelly fire tore through the sleeping quarters at an academy for one of brazil's most popular professional soccer clubs killing ten people and injuring three. the injured were all teenagers no word yet on the cause of the fire israeli troops shot and killed two palestinian teenagers as thousands held demonstrations along the perimeter fence separating gaza and israel the protesters threw rocks at the israeli force stations behind the border who responded with tear gas and some live fire heavy machinery began taking
down a huge slab of the morandi bridge in jen whgenoa, italy they were on site to watch the work, saying it marks a relaunch of the city. a new bridge built by 2020 you're up to date. back to you. >> thank you, sue herera 90 minutes left in the trading day. a check on the markets right now and sort of digging our way out of negative territory throughout the whole session. we're sitting close to session guys the dow down by 0.6% and nasdaq 4 points almost unchanged and the s&p 500, this is, in fact, session highs. 2699 is your level down, a quarter of a percent kelly. >> melissa, thank you. billionaire blackmail, amazon ceo jeff bezos accusing "the national enquirer's" publisher of sending to his
girlfriend rather than capitulate to education extortion, i decided to publish it despite what they send me. they said it supports "the enquirer's" investigation but will look into the claims. the risk facing amazon shareholders with us is dean crutchfield, welcome to you. >> thank you very much >> amazon shares down 2% or so today. but if jeff bezos is pursuing a criminal lawsuit against this company, could this drag on for years? >> it could drag on certainly for some time. he's put his company in a bad spot and board of directors in a really bad spot and clearly himself. the richest man in the world could become the biggest joke in the world. there's panic running through his life and his team. >> it's interesting he could become the biggest joke. this is a guy who has built amazon and defied skeptics many times who said it wasn't profitable enough and he couldn't expand into retail and
time and again, he's proven he knows how to build this business is his credibility fundamentally threatened by this >> this could define you for the rest of your life and the public want it. bezos, he's not a loved ceo like a warren buffett we want to see this dirt, it's excitement see that person in some kind of pain, for a large proportion of the public, there's definitely that instinct. this could drag on for some time >> why is the company in a worse position today than 24 hours ago? we knew there were intimate texts and photos as well the revelation it actually exists makes it a worse position for the company? >> it's a fact and he's made it clear himself. there's no gossip, there's no discussion they exist so now we want to see them elon musk and the trouble he caused his company he's the company bezos is amazon. for the billions dollars and his success, he's the man, defines
the company and clearly its performance. >> what does reckless or foolish behavior, if you want to describe this as that, that doesn't take place on company time, doesn't involve company assets we don't know. if he was flying people around privately on company jets and paying for them with company money, it might be a different matter why does it matter to the corporation? >> he's been negligent and he's been negligent not with his own reputation but the reputation of the company. this is a dangerous place to be. >> let me turn the question to what you specialize in, in part, crisis hgt they' management their ceo is under siege has he acted intelligently in trying to get out ahead of what could be even more damaging stories by american media? >> i think, yes, he has. and he's in a catch up
situation. as a trial lawyer would say, get out there with your own facts before the media and the authorities did. this has already come out so he's doing catch-up but clearly got a plan and seems to be working. got a crisis team in place because they're handling all the media. he's come out with a very bold response about bribery and extortion. the next and final part is hide nothing or tell all or in this case, reveal all so that's going to be the real crunch time for the situation. >> what would be your next concern regarding this situation? he seems like he has a plan in place and gone out in front of the story, from your standpoint, if you're consulting the company, what would you say is the next thing to watch for? >> when you accused him of bribery or extortion, is this scoundrel? i think it is. we've lifted up the hood but this is not criminal activity or extortion, as much as he's making it out. that could blow back in his face because they have to respond to the accusation and how they respond is where they have an
uncontrolled situation and i think that's what we have right now. >> there are reports that the federal patriots are looking at whether this, what mr. bezos characterizes as extortion or blackmail violates an immunity that they made with the federal prosecutors office with the respect to payments of money to silence females who alleged to have affairs with the president. >> if that's the case and they find it, ami is dead they're finished. >> if found to have committed a crime in this instance >> i believe -- >> that violates their promise under the immunity agreement not to commit crimes. >> i think we'll see them disappear. >> how does compare or contrast with the situation in your mind and the way peter teal who felt he was wronged ultimately went after them or say, i will fund this lawsuit or take it to them and put them out of business >> i think there's a difference between peter and the nature of the hubbub
this is gosh, horror and probe a lot of details gets lost in that it's all about these pictures so i think it's a different game. a different situation, i'll be honest with you. i think very different indeed. a lot more excitement. >> it's a question of his own legacy he knows the danger here any of this comes out, this is what will define you in five years or ten years, always be known for this it's the last thing the richest man in the world wants, right? >> he might say, so be it. the die is cast. people are aware of this already. i'm going to focus on making amazon the biggest, best, greatest company of all time and let that be. >> wake up in the morning and look himself in the mirror and the company is not on his mind right now. he is on his mind right now and his legacy and how he is going to be defined and i think that he's in a really kind of shaky place right now. this is unchartered and i'm sure this is a person who cannot
believe this is going on in his life considering the power he has and the control he has, this is now out of control. >> you've made the comparison with elon musk and the problems he had, in particular, smoking marijuana on the joe rogan podcast. we're in very different situations though. tesla is a company that is still an upstart company, still needs to be funded, still expanding in terms of its products, et cetera amazon has been around for a very long time now amazon is one of the biggest companies in the world and arguably a more stable company than a tesla would be so therefore, jeff bezos, as an important part of the amazon story is important but may be less so than elon musk. >> there was an unstable situation. jeff bezos is showing there's an unstable situation. >> equally >> even more so, i think, because this is amazon and i still think. >> elon musk, you could have said what he did on the podcast implied he might have a dereliction of duty on the job you know, could you make the
same assumption about jeff bezos? >> this is totally negligent what were you doing with your phone? everyone is look agent you aingd use a technology that's easily breached kind of madness. >> also here, the yale school of management jeff, what is your response to what we've all just been talking about here i mean, is this something that you think now is consuming jeff bezos' time and attention to the detriment of the company amazon? >> not with the resources he has. i've been enjoying the conversation in part because i'm not jeff bezos we can all sit back and enjoy it if we're not jeff bezos. i'm a different jeff entirely and i agree with my fellow guest, it was indiscreet and foolish, but you know what the leaders of universities and the leaders of churches and the leaders of government agencies and all kinds of governments and corporations are human beings and they're subject to human frailty and do stupid things
how we judge somebody is how do they respond and of course, what's the magnitude of what he did? he didn't in these other examples, not travis promoting the bro culture in the old days of uber, this is not dove wearing nothing but a sock and not on his foot, by the way, at american apparel this is not les moonves scandal at cbs or the indiscretions of elon musk with his nasty insulting twitters out there with misleading information to investors. this was a private communication. it's hard to imagine that jeff bezos, who is so much the face and image, his name is hyphenated with amazon, he's actually a really private guy. i've been with him many times and partially because of his choice, i don't have a relationship with him. i tried in veiain. he doesn't come on your shows. >> let me come back at you a
little bit there at the very least, for a person who owns a major media outlet, "the washington post" and is as publicly identifiable as he is, and who works, by the way and runs, i think, the largest cloud corporation in the world, amazon web services, for him to engage in this kind of recklessness, and i think it's fair to characterize it as such, it's deeply personal and people can do on their own time whatever the hell they want with their cell phones as far as i'm concerned, but this does betray a kind of reckless or clueless behavior that makes me question him. >> this doesn't resound well for anthony weiner, it didn't help his public image and not a positive for jeff bezos' image and a mild deleterious effect.
it's a warning over that they need to know who's their tim cook to this brilliant steve jobs, just like who was the andy grove that was going to be there to back up gordon moore or bob noyes and others, who else is there besides jeff bezos but dangerous to blame the victim. it's reckless but all kinds of private personal communications that shouldn't have been stolen or put out thereor used as bribery and extolen. he's being victimized. i support amazon employees that are largely rallying behind him and the board is supportive and not the guy is abusing company resources or pilfering or harassing employees. this is nobody connected with the company. i think it's a very important distinction and he's not getting a free pass because he's a technology genius or associated with anti-trump publication. >> do you think, jeff, clearly,
this is what he did in his private life as he outlined, his own phone, personal communications but his response to it was squarely in the public view do you think the board should have been involved when it came to issuing this blog post on medium of all places before it was actually posted? >> i believe -- >> does it become a corporate governance issue if we're respo -- he's responding in that way >> i don't think this is the result of a temper tantrum what he's done is, i believe, board members were informed, i don't know if it was the full board but i believe certainly the board was brought into it much the way ken fraser, far more noble situation, post-charlottesville when he took off the advisory panel and said he'll do that with or without the support. they happen to support him in this case, it didn't just happen yesterday jeff bezos began these investigations with the knowledge of the board at his
own personal resources for several weeks now trying to take a look at understanding where this data, this information was coming from, how these personal communications had been purloined. it was not a surprise and surely before he went public, the board weighed in on this and i think it was effective i think he's taken the weapon away instead of being held hostage by these people. pretty much obliterated the issue. we think a little less of jeff but impressed with his resilience. >> thank you very much >> coming up -- powerhouse the $25 million florida estate of red sox owner john henry. it is for sale may have a hard time selling it to a yankees fan the dow made a bit of a comeback down 150 points it had been off nearly 300 earlier in the session
time now for powerhouse. today we're going inside the home of boston red sox owner john henry robert frank has more. >> thanks guys today's powerhouse is a cnbc exclusive. the south florida home of red sox owner john henry the billionaire recently listed his residence in boca raton and you're about to go inside this sprawling estate you're going to see one of the coolest sports bars in the world. take a look. ♪ >> this $25 million estate in boca raton is the family home of billionaire john henry, owner of the boston globe, england's
liverpool football club and the boston red sox >> the first thing you see is this magnificent sun soaked great room which features 30 foot ceilings and just an open airy space. >> mr. henry's passion for collecting japanese antiques and art work is evident throughout the 41,000 square foot residence. the mogul even commissioned an artist to hand paint this bathroom steps away is a space to feature the sun. it's called the sunset room and mr. henry said to have closed some very big business deals here the billionaire's pension for music can be seen in the state-of-the-art recording stud studio he had built. he also loves pizza. he built an italian themed dining area around this brick oven around the master suite, the red
sox owner's pride and joy. sports bar with trophies, baseball bats and golden gloves. this is the first and last time cameras will ever get to see this mr. henry's broker said after our shoot, the family moved all of it into a vault >> the home was custom built for the family in the 1990s as a full time residence. >> but today, the henrys are ready to move on the family is listing the estate for $25 million and in case you're wondering >> sorry to all of you baseball fans out there the red sox memorabilia is not included >> i'm sure he'd throw in a baseball or two but what is the better investment? the house or the red sox henry and his partner bought the red sox for $382 million so that's up 8 fold he built the house and bought the land back in 1981 for
$850,000 so depending what he paid for the house, if he sells for 25, about the same gain but over a much longer period so the red sox win as investment over the house >> wow, wow. $380 million is all he paid in 2002. >> he did well with both though. >> whoa, man robert, thanks if you exclude the last three days, big caps have gotten off to a good start in 2019 but small caps are on fire off about 10%. 'lgeso fe artock picks next (vo) we're carvana,
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about an hour and eight minutes to the closing bell. stocks are sinking one area that's been outperformlin outperforming, this year small cap stocks and so what are the best plays in the group bring in steven diniclio i remember when kauffman was its own fund before fed rated. steven, welcome. >> great thank you for having me. >> why are small caps doing as well as they are is it as simple as that they are
less inclined to be affected by a global slowdown and less inclined to be affected by tariffs? >> you hit it right there. we think it's a good time to invest in small caps and if you look at what we have been doing at the fed rated kauffman fund over 30 years is trying to look for enduring, secular growth xaens, companies to transcend economic noise and have idiosyncratic formula and worked for us over time and last year small caps in general underperformed and no doubt you have had a little bit of a bounce here and over the long term this is a great place for investors the look. >> you have three stocks you currently like an i ask you to go through them. why don't we start with shot spotter? why don't you tell us about the stock and why you like it? but tell us how it becomes a classic pick for your fund what are you looking for and why
does it fit the criteria >> sure. look we spend a lot of time on the ipo market and this company came public about two years ago and was a very small offering and was not a very excitable deal. shotspotter provide -- they have a robust system of software and sensors that can identify exactly where a shot is fired in the city so this is fantastic way to increase the safety of cities very logical, low cost solution. they have no come ppetitors over 80% of shots fired in a city don't go reported by 911. so we did due diligence with local municipalities and police departments and found a company with very little competition and very strong growth so this is a classic stock for the kauffman fund. >> astronics. >> company based in upstate new
york aero space supplier company, they have the leading franchise in in seat power and lighting. boeing at all-time highs and backlogs and it's a good place to be. what's great is people are missing a pivot in the business. they sold a test business, noncore cyclical part of the business for $180 million, more than 10% of the market cap receiving in cash. the stock does not move at all in addition, they have a new offering for in-flight connectivity in the business jet market that we think is going to grow in excess of 50% this year. it only has 33 million shares outstanding. you throw a couple million dollars to the bottom line and the street estimates for 2019 look terribly low. >> in 30 seconds, tell me about trex even know i know this. composite deck materials manufacturer. >> i'm glad you know it. did you know it's the largest
recycler of plastic bags composite decking has tremendous amount of benefits over wood decking yet it is only 15% of the overall deck market. every 1% that trex gains, leader by far in the market, is $50 million of business to trex. they have a clean balance sheet. no debt. very high incremental margins and this company should grow regardless of if the housing market starts to slow so it's a very exciting long-term name for small cap investors. >> steven, thank you very much. >> thank you. >> appreciate it. and check please is next ♪ you should be mad they gave this guy a promotion. you should be mad at forced camaraderie. and you should be mad at tech that makes things worse.
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at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility. emerson. consider it solved. check please. >> welcome back. heated discussion that will probably continue for sometime about jeff bezos and how he behaved in trying to get out ahead of "national enquirer" and we haven't talked about relocating hq-2. >> there was an appointment earlier this week. deputy majority leader of the state senate in new york appointed to a control board to give this individual a veto power over whether the headquarters can be built as planned in long island city. and he has been a vocal opponent of it for a variety of reasons having to do with house prices and changing the complexion there. also, large union issues at work
here amazon a nonunion shop of course, new york largely a union city. >> obviously the stock is moving on this news and the question for shareholders, is amazon better off with jeff bezos at the top with these disclosures i bet the answer is next. >> "closing bell" starts right now. ♪ ♪ everybody's working for the weekend ♪ good afternoon happy friday very warm welcome to the "closing bell. i'll wilfred frost. >> i'm sara eisen. coming up in the final hour of trade, a bombshell blog post as jeff bezos accuses "the national enquirer" of blackmail and extortion. plus, the ceo of cleveland cliffs who in october called an analyst a disaster, embarrassment to his parents, even urged him to commit suicide, he'll join us live on set as his company