tv Power Lunch CNBC March 11, 2019 2:00pm-3:00pm EDT
international community has already, especially like human rights activists or, you know, watch dodo watchdogs, they already put pressure on china to do better with citizens. the province who are sent to camps and mistreated and so i think there are those sentiments already out there. it's just a matter of how much more pressure can they put on china. >> shannon liao, thank you for joining me time for "power lunch. >> we'll see you in just a moment, kelly. i'm melissa lee with tyler mathisen boeing down this hour. another fatal crash with the most popular jet just how safe are these planes and how big of a problem is this going to be for boeing going forward? this historic bull market turns ten. keep calm and carry on what investors should expect from here. and apple rallying big today all the negativity now priced in "power lunch" starts right now
>> good afternoon. welcome, everybody, to "power lunch. i'm tyler mathisen odd kind of trading day. boeing, of course, weighing heavily on the dow as it has all day long, but most of the stocks in the dow, the 30, led by apple, 3m, coca-cola, all rallying s&p 500 soaring more than 1% almost 2% gains for the nasdaq composite, as you see there. 1.87 nasdaq, 100 on pace for the best day since mid february apple, microsoft, amazon, facebook, they are leading the way. and leading our coverage is bob pisani at the nyse bob? >> tyler, we had boeing cutting its losses in half essentially and that's why the dow has rallied here and look at boeing, you could see some of the suppliers that boeing has. united technologies, one of them earlier on but most of the suppliers also well off their lows united tech, as you can see, has gone positive. but elsewhere, it's one of the best days we have seen in weeks
down here. the market internals, how it trades internally, looking especially strong 4-1 advancing to declining stocks right now. advancing volume is 83% of all the volume that's a really big day on the upside people are buying more stocks advancing than declining new highs modestly expanding close to 100 but if you look carefully, low rates creating opportunities in utilities and real estate investment trusts. most of the new high lists a smattering of wreaths. avalon bay, mid america and american tower, which is now a wreath by the way, and of course, the story here is when interest rates drop dramatically, or stay low, it makes other interest bearing mechanisms more attractive guys, back to you. >> bob, thanks to the big story of the day now. that is boeing shares tumbling after another deadly crash involving its most popular type of jet and a number of new developments on that. philip lebeau here with the very latest. >> reaffirming its ratings for
boeing we'll explain why in just a little bit but an update in terms of where things stand with the 737 max 8 investigation. the crash happening yesterday in ethiopia with an ethiopian airlines airplane that crashed the 737 max 8. the faa and ntsb are assisting, probing the crash, going over the flight data recorder, the cockpit voice recorder once that comes together, the max airplane, 350 approximately in service around the world with backlog of planes they're going to be building out over the next six years of production there. 70 flying in the u.s. and building up that backlog, look at the increase in production for the 737. these are almost primarily max models at this point and a number of them max 8 they're at 52 a month right now. going up to 57 per month by the end of this year take a look at shares of boeing. you heard bob talking about them cutting the losses from earlier in the day keep in mind, the 737, it
generates 20% of boeing's sales every year and the max is a key driver of cash flow. we get the latest orders and delivery numbers tomorrow and i mentioned standard and poor is reaffirming the guidance, guys because of the backlog and lay out in this note, even if there has to be some type of fix that's mandated by regulators, the faa and ntsb, where are customers going to go? are they going to airbus wait in line seven or eight years for a comparable airbus model or say, boeing, if it has to make a fix, will make a fix if in fact there's something related to this accident that needs to be changed immediately. >> phil, i know the details are still sketchy at this point but is it generally believed that any sort of fix would in fact be a software fix and what happened to the software fix that boeing had been finalizing with the faa shortly after?
there has been no fix at all after these crashes? either >> first of all, after the line air crash, the first thing the faa said, they issued a directive to boeing, saying you'll make it clear to your customers that the flight crews need to know how to handle this situation that they might incur in certain situations where they get faulty data fed into the plane's systems. so they did that that's the first thing that happened back at the end of last year at the same time, widely expected we'll see some type of a software fix at some point going into these 737 max 8 models that could further correct any possibilities when this situation occurs. for airlines the situation that is believed to have led to the crash of line air. that's expected to happen at some point boeing has not officially signed off on that yet. >> phil, thank you very much what's up next for the crash investigation? and what are the risks facing
boeing and its 737 max 8 jet mike boyd, president aviation group and then paul, the transportation safety board. gentlemen, i'll begin with the same question for both of you. does boeing need to voluntarily ground these planes? >> yes, i think boeing should voluntarily ground the plane and as a result, demonstrate they're putting safety first in regard to the future of this aircraft. >> mike, how about you >> well, i think we need to hear from these experts here. we still don't know exactly what the cause of the crash was when we find that out, we move from there but i think, in the u.s., it wouldn't be a big hit only 1% of total fleet but, you know, in other places of world, it would be a hit. in any case, even if grounded tomorrow, it would be a minor impact on the u.s. air transportation. >> so why not ground them tomorrow if it's a minor impact especially in the united states?
and you seem to be saying, let's wait and see is that a gamble you'd be comfortable taking >> i would until we find out what the boxes say from this crash right now today. america is confident with the southwest which has 224 more of them on order confident with it and these aren't people who fell off the turnip truck it's safety related too. 12 hours to figure out what's really going to happen when that happens, we move. >> would you get on one of those planes tonight >> this afternoon, i would, yes. >> jim, how about you? >> no, i wouldn't. >> you wouldn't? what would you wait to see before you would change your mind, jim? >> obviously, there's been a lot of discussion, and a lot of transparency in regard to what's going to be done to fix the error that caused the line air crash. now we have a second crash in what has been historically in the last decade, almost zero
commercial accidents in aviation so i think if i were a boyd investor or a member of boyd, i would want to put safety first there's too much in the pipeline to risk to not put safety first in this situation and ground the planes until they're sure that whatever caused these problems has been addressed. >> what role, jim, does the government have in deciding why they're not to ground certain types of aircraft? i hear conversations here in the newsroom about people planning ongoi going on a flight this wek on the 737 max concerned but saying, you know what? if the faa doesn't say anything, then i'm just going to go ahead and do it. you seem to believe there's, these planes need to be grounded though doesn't the government have anything to say to protect its citizens >> i went through this in the 1990s with boyd aircraft on the earlier models, 100, 200, 300 on
the rudder issue and in that situation, we didn't have transparency at the beginning. the issue was not addressed and we had a second accident fortunately, we never had a third. i think in this situation, you want to be sure, now that there had been two accidents, there are similarities that have been identified, that the cautious and responsible thing for boyd to do is to ground their aircraft they may find in a very short period of time that there's reason release that ground the manufacturer's responsibility in this situation to put safety first. >> so mike, let me turn to you i was texting earlier today with a friend who happens to be a retired air captain on a major american airline and i asked him the question, i asked you. would you fly on one of those aircraft today would you fly it as a pilot? and he said yes, particularly with respect to u.s. carriers. he was more suspect or cautious,
shall i say, with respect to foreign carriers because he doesn't have the same level of confidence in their maintenance and training i like to get you to react to that and also, to what you said earlier which is, you seem to counsel a kind of let's wait and see until we know what's happening in the crash how long might it be until we know enough of that more to come to a conclusion on whether these planes need to be put on the ground for a while >> a lot of breadth and scope there. let's start with this. i would suspect right now, they're putting a full-court press to find out what's on the black box in the cockpit voice recorder mostly the black box we might be hours away from that i don't know it takes longer than that but they'll echo xpedite it don't know whether they're on a max or airline machine and to say i won't fly again, you don't know if you're on a max or
78-78, the average customer doesn't know and i would agree with the captain you spoke to that overseas, i am getting on the airline. >> keep in mind, about 75 of those airplanes over there 1.6% of their total fleet, 82% load factor. really have a hard time replacing. but that was their decision to make but my feeling is i think we've got another 12 to 36 hours before we jump at anything because i do think the skies are safe >> gentlemen, fascinating conversation and it certainly got everybody's attention in the traveling public also, the investing world. mike, jim, thank you >> thank you >> you're welcome. >> better believe that people are looking up what airplane they are on right now. they're going to be traveling, for sure >> you can find out. i mean, it's a question of most
people don't know what they're on but they bother now >> yep investors seem to be bailing. how big of a risk is this crash for boeing's growth and the stock? joining now, jim, analyst at cfra great to have you with us. the stock reaction within today's session so far has been fascinating. we pared losses by about half or so can you sort of give us the worst case scenario out of this outcome and what you see as the most likely scenario in terms of the stock? >> certainly, but first of all, let's say that we do recognize that humanitarian impact of 189 people that lost their lives, more than just a stock market issue and we're saddened today but we think the worst case scenario is the stock continues to sell off as news comes out. if boeing has some culpability here and a known issue they didn't correct, that's the worst case scenario. >> we think the planes will be found to be safe as your panel pointed out and
phil pointed out earlier, united airlines are all standing up for the plane today. the pilots in the united states, very strong and we haven't heard a reaction from this saying they feel unsafe. we believe boeing will get to the heart of the issue and will be a software patch and pilots do know how to override the system or at least they should know how. >> you know, it was interesting jim in the notes i got before your interview, the system is easy to override and pilots should know how to do it as if it's so simple are you a pilot yourself or know exactly what it takes to override the system and how simple this would be >> i couldn't identify a single button on the aircraft but that's not my job. my job is to evaluate the stock. boeing issued a directive after the line aircraft explaining how to do it and i'm sure there will be a software patch to override this system at this point but i don't think u.s. airlines are worried they don't know how to react if the plane thinks it's going to stall there's a button i'm sure to push to override the system and it's been pushed out to them by boeing on how to do so >> jim, people are pointing out
that boeing had an issue in 2013 with the dream liner that was complex, those aircraft are grounded for a couple of months. 2013 was a great year for boeing one of the best stocks since that one didn't involve planes crashing and fatalities. airbus shares weren't really rallying today but i wonder if that points back to the fact that airbus doesn't really have an option. in a way, you're forced to be with boeing if you're these airlines should we take into consideration when we're trying to figure out what's safe and what we're hearing from airlines or not hearing that there's no real option. they're booked to the teeth and so it's hard to be super conservative in this situation, isn't it >> i think the first place you have to start is looking at boeing's long-term track record of decades of safety obviously, you never want to lose a single life in the air. we have two plane crashes in less than one year, unusual for this industry and certainly says something that needs to be looked into but like you said, there's only two major airline makers they're both pretty much sold out for the next five or six
years. boeing slots are completely full and i don't expect them to see major order cancellations here if you're looking at the investment thees thosis, it's bn safe and the long-term fundamental outlook is very strong boeing is obviously number one in that industry. >> for sure. i'm just saying, is the real alternative for the her khmecusa real alternative to this aircraft >> no, if you want to book away from the 737 max 8, you can look on the day of your flight, but you'll pay a penalty as you try to book away from it that's not something a customer can really realistically do. >> i mean, for the customers of the planes and the aircraft. i'm talking about the airlines united and southwest in this country and, you know, some of the other major flier whs in otr countries. is this a real alternative to this aircraft? >> no, they continue to want
this aircraft. as long as the safety does bear out, which we believe it will, these planes are 15% more fuel efficient than the category before it. they are great economical planes for cost but obviously, safety is the number one concern. in the near term, they have the orders, they'll continue to take their orders, we think. >> jim, great to have you with us corridors with a 500 price target on boeing. much more with the markets the dow would be up except for boeing is higher as you can see there apple leading the way up more than 3%. the president also unveiling his budget proposal and asking for some big changes to the way the federal government spends money. we'll tell you about that next so with xfinity mobile
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now that's simple, easy, awesome. customize each line by paying for data by the gig or get unlimited. and now get $250 back when you buy a new samsung galaxy. click, call, or visit a store today. president trump released his proposal for a federal budget for the next fiscal year that includes more than $8 billion for a border wall. ylan mui in dc with more yee l ylan >> that is one of the poison bills. that's essentially doa on capitol hill briefing reporters right now at the white house on this proposal a lot of the tension is being focused on the $1.9 trillion in mandatory spending cuts over the next decade. one big part of that is changes to medicare. the white house proposing eliminating $66 million over the next decade through rules to
prescription drug benefits and establish work requirements for medicaid and for food stamps but there's also some new costs in this budget proposal as well namely, extending the current tax cuts and making them permanent. the white house is also proposing a big increase in defense spending so the result of all of this is the white house projects the deficits this year will hit $1 trillion and that would continue through the year 2022. guys, even after a decade, the white house says we would still have a deficit of about $200 billion. they say eventually, that will go away but not until 2034 which is 15 years from now back to you. >> ylan, thanks. an incredible run for the bull market too. the ten year anniversary with the retail sales report that shows consumers picking up spending and a worse decline in december does need to raise rates where to go from here?
andrew slevin with morgan stanley, investment management and joe lavornia chief economist with natixis anything about the budget? >> no, the market seems to not be worried about the budget. more focused on the data and the prospect of the fed being on hold and inflation being too low. so no. financing hasn't been an issue my guess is in the short run, it won't. >> partly because of what joe said, germany just helped out with that, didn't they what would it be if german bunds were negative again? >> probably higher but the point is that where interest rates are is valuable on the market and that's why you see some strength today. >> 300 points or so to the upside joe, i'll go to you on that as well can we take for granted that
european debt is going to be as more bund as it is and therefore the ten year yield divorced from u.s. economic prospects. what do you make of the fact that wage growth is so remarkable >> on the wage side, relatively weak, kelly because productivity has been weak but on the u.s. side for rates, u.s. ten year yields higher relative to most of the globe, that's because of europe as you mentioned, very low rates. much of the german yield curve is negative and as long as the ecb continues with this extraordinary stimulus which it said it will through this year, that's going to cap the ability of ten year yields to rise i expect 10 year yields to stay comfortably below 3% and that probably means we could do a lot more on the fiscal year. >> a lot of things in the market indicated a pause was on tap that the breadth was weakening, the transports looked terrible, the small caps looked very bad and these are patterns we've seen the last couple of weeks
and here we are today, very strong in the markets. thanks to big cap technology we had that apple upgrade, a facebook upgrade, semiconductors really rallying today. does it show you this is a big cap tech kind of market? as long as you have that leadership, the markets are all right. >> yeah, absolutely. look, i think on the negative, the biggest negative for the market is that 75% of the market, the company that is buying back the stock, the window will close by the end of this week. that's the biggest buy stock because leading up to the core the positives is that two things happen friday and yesterday on friday, we had a week employment number. the market actually does better when we have weak employment numbers than when we have very strong employment numbers and then you had fed chairman powell saying he's not going to raise rates anytime soon so i think that's a very powerful combination we have this battle going on in the market between the fed
causing it to go up but right now, the markets focused on the former, not the latter. >> joe, i didn't think the report was that weak on friday other than that fact the headline was smaller, the unemployment rate historically slow, the wage growth fantastic and you're continuing to work on the u-6 unemployment number to get that down as well. i mean, this goes back to corporate profits, doesn't it? the interesting puzzle to me, if you have no inflation but definitely wage growth, we talked about median wage growth with people without a college degree last year up 6% that's got to come from somewhere. if you're not passing it along, is it corporate profits sf. >> eventually, you think it would but the corporate share of income has remained very high and been little to suggest that margins are shrinking in any meaningful way having said that, kelly, i took the employment report being on the weaker side. given the revisions, the breadth of the job loss and it's occurring against relatively weak retail sales, weaker
purchasing data and i don't think the numbers look great but as andrew said, it's on hold and expand multiples the markets forward looking and what matters, kelly, where is growth in the second half of this year and i'm looking at a lot of incentive and indicators like consumer expectations if they stay reasonably high, then we'll have a good second half and the equities make new highs. >> andrew, i see in my notes you're a believer in the presidential election cycle theory of investing. explain why and explain what it says right now >> i think the point, well, first of all, the third year leading up to an election is, tends to be a very good one for the market i think it's because presidents try to have the economy looking good or the party in power looking good for getting reelected and so that's a reason for the market to be strong. i think what happened with powell saying we're not going to raise rates anytime soon and an
election year next year typically when the fed doesn't want to get too involved, i think the market is realizing that the fed may be on hold for quite a while here if it's not going to happen this year so the third year is a pretty good time for the market because there's efforts to prop up the market leading up to that election year. we'll see if this time is different but it's been a very consistent indicator of strength in the market. >> guys, thanks. andrew slimmon and joe lavornia. shares of apple are rallying in the past two months did the market overreact and late last year plus, retail detail after a bad december things are picking up. will the consumer keep spending? "power lunch" will be right ba ck ♪ (butcher) we both know you're not just looking for pork chops. you're searching for something more... ...red-blooded.
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shipsticks.com saves you time and money. investment opportunities beyfirsthand, like biotech.ne because your investments deserve the full story. t. rowe price invest with confidence. welcome back to "power lunch. i'm michael santoli at the new york stock exchange. time now for "trading nation." investors taking a bite of apple today. shares rallying after bank of america upgraded the stock to a
buy. raised the target from 180 and noting head winds in the services business as well as hardware have receded. with oppenheimer, gina sanchez, to weigh in. a positive move today. obviously, the stocks have been in repair mode still a long way to the highs though how does it look to you? >> i would say the evidence is mixed, speaking in terms of the near term action but we saw positively based on the long-term and the key long-term positive for us are the top down tail winds from what we see as a broadly and relatively strong technology sector. we continue to think that a premium gets placed on these high growth companies in a low growth world speaking in the chart of apple, you can see the slow sideways that speaks in terms of the mixed near term. the next incremental positive in terms of the trading would be a rally above 185. that is the stock's november
gap. >> all right and gina, for a long time, really, almost forever over the last decade or so, you've been able to say, apple stock looks kind of cheap relative to other stocks and it depends how you view the business and where it's going from here. what is your take? >> look, i think it's still cheap. i think there's a lot of talk right now that apple is not going to focus on the iphone sales anymore and focus on services even services stocks trade at a higher multiple than apple is currently trading. it's not mattering how you view the apple stock but cheap relative to its current mix or cheap if it continues to focus on wearables and services and its eco-system either way, the stock is cheap >> and cheap, but not cheap for a good reason. what you're saying >> you know, this company has continued to put earnings after earnings after earnings. and so i think that if you look at it over the long-term, i would consider it the value stock of the technology sector it is very robust and i think that's what you need right now
going into the year. >> all right gina, harry, thank you very much for more, follow us on twitter @tradingnation attention all viewers, attention all viewers. here's what's ahead on "power lunch. retail sales beat expectations is this the sign of a healthy consumer oil up more than a percent today and then speaking of oil, lisa murkowski will join us live to discuss america's energy future. all this when "power lunch" returns. >> and now, the latest from tradingnation.cnbc.com and a word from our sponsor. >> a common mistake that some investors make is a stock with the higher dividend yield. a higher dividend yield could mean the stock prices sharply or the dividend itself at risk of being cut. before you reach for yield, be sure the stock is also
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here's your cnbc news update at this hour. senator lindsey graham vowed to spearhead a push for the u.s. to recognize the golan heights. he visited with benjamin netanyahu. >> i believe there's bipartisan support to recognize the golan heights part of the state of israel for a lot of reasons. the golan not in dispute the golan is in the hands of israel and always remain in the hands of israel. >> secretary of state mike pompeo welcoming jordan's king abdullah to the state department the king is expected to hold a bilateral meeting with vice president mike pence the duke and duchess celebrating all things canadian after visiting london. they watched children make maple t taffy before canadian made baby clothes. the royal couple is expecting
their first child in april right around the corner. that's the news update this hour kelly, back to you >> thank you very much, sue. about 90 minutes left in the trading day. let's get a check on the rally right now. the dow's positive by 172 points boeing about doubling that and a sense of what the broad market is doing 1.3% gain. 27.78. up 1.8% and leading way higher today. the oil market is closing and crude oil is still higher by about 1.3% melissa? >> thanks, kelly rebound sales slightly the latest numbers in the health and consumer chairman of sachs and steve, always great to see you. >> great to see you. >> you were remarking about what you thought indicated the consumer is strong your corner of the universe used to be luxury, apparel and those were the areas actually weak in february >> apparel sales came down a little bit in february from the
strong performance that you saw during the holiday season. you saw 6%, 7% growth during the holidays for apparel, best you've seen in years a little bit of slowdown in apparel and luxury weaken. i think that was probably tied to the stock market volatility you always see this high correlation between luxury and the stock market, so i would expect to see a little bit of strengthening based upon what you see now but overall retail very healthy the mastercard numbers were showing growth in the high 3% range. that continued from the holiday season the government numbers were a little bit of an anomaly in december you saw this big dip and everyone thought about retail. >> what happened >> i'm not sure. mastercard numbers showed continued strength it was during the shutdown the government metrics, in fact, the revised numbers for december came down even more saying that the internet sales were down and amazon reported a plus 20. that's half the internet so i'm not quite sure what was in the government numbers. i would think the mastercard numbers were reliable during the holiday season they showed continued strength
i think there was a headline a couple of weeks ago, retail ice age and with a question mark i don't think that's the case. i see look at the earnings we saw out of the retailers, whether it was the walmart, the targets, from high to low. you saw some pretty healthy numbers. so i think you have a good consumer right now. >> you mentioned the stock market as really being an impact on the high end consumer when you take a look at the real estate market and particularly at the high endof the real estate market where prices are kind of soft, i mean, what are some of the other areas within the markets? do you look and say, it could be kind of tough sledding for the high end retailers >> i'm not sure it's going to be tough sledding it's clearly the high end of the market especially in markets like new york and miami on a real estate side you've seen some volatility. a lot of that affected because of the, oh, gosh, in miami for example, the latins and russian affecting the market tourism is affecting the high end luxury market too. you've seen a slowdown in the chinese tourist, for example, and that's been affected by some
of the tariff concerns, et cetera so i would expect to see a little bit of volatility at the high end on the luxury consumer but a longer term, i think it's a pretty healthy market there. >> since i have you, i'm curious what you think the profitability will be of these new types of stores we have talked about. new services with apparel and may not sell that much apparel so do you think the people who are going in and getting things like drinks and haircuts and whatever else is happening now, what happens to the traditional business model of retail >> i think retail is fundamentally changing moving towards this omni channel retailing, online and store, anywhere they want to be able to get it and as you said, experience is the name of the game you've got to provide an experience the product? >> profitable experience >> no question about it. and it depends what kind of a service or experience you're providing. i think margins you're raising is an important question and
wage input labor, cost increases, you're going to have the supply chain increases and got online shipping is more expensive than instore for many of the retailers so managing the profitability is something that each of these retailers have to deal with. but it's not one size fits all if you're a luxury retailer, for example, the online sales are more than your in-store sales. it can be, sure. because you're not paying some of the commission rates. you have the shipping costs are a small percentage of the total costs. so it's really the lower end that you have to really worry about the profitability on the internet, but experiences are very important i think you've got to be able to provide something that's different. it's going to be low price >> one of the areas was building supplies and materials this is all traceable to the matheson kitchen renovation, subject it
isn't it >> people are renovating houses look at the home depot numbers remarkable for the last year or two, all about the renovation economy. >> thank you for seeing you. >> tyler, tell us your next big project. adjust accordingly. >> i try to get the price up, the bidding price. the guy comes in at a bid. >> 20% >> get that to $30,000 come on. thanks, steve. >> thanks. oh, hi the market is shaking off the boeing headlines they're rallying today take a look at that nasdaq 100 there are only four of the 100 stocks there are down and overall index up near lly 2%. nvidia and apple, at&t are among the leerads. you see right there. "power lunch" will return at 18 before the hour. measure up?
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conversations about how the gravitational pull from europe and japan keeps our rates low. auction today, $38 billion first of $78 billion in supply it was three year notes. the yield, 2.448 i gave the auction a c plus. it was basically average on all metrics except for a little heavy meaning a good thing on indirect bids at 50% and priced pretty well. as you look at the screen, you'll see a three day chart of the dollar index it's on the lows of the session right now. but it's still holding the 97 handle and you could see clearly if you go back to thursday's big jump, we're still holding about half those gains and believe me, most traders are eyeing one level. 97 even. melissa lee, back to you >> rick santelli, coming up, we're going live to the big energy summit in houston senator lisa murkowski talks u.s. energy policy and much more stay with us
the world's top power players in the energy business are gathering this week in houston. some of the big topics include the impact of the u.s./china trade war, geopolitical disruptions fracking joining us is senator lisa murkowski. senator, it's great to have you, welcome. >> good to be with you great to be here in the week. >> there's headlines that show what is happening in the u.s i see first of all that we are headed to surpass maybe russia and catch up with saudi arabia as an oil exporter maybe within five or ten years and wanted to ask you talking about the u.s./china trade war how significant the deal is that was signed to export lng to china. >> well, you have raised a couple of things here. first of all, recognize that the production here in the united states is expected to surpass
saudi arabia by the end of the year that is significant. we are now truly a global oil producer you mentioned the lng and the opportunities that we have for export to asia, china, other nations there. it is significant insofar as our ability to take what we have -- what we have been allowed to to bring to fruition through this really this shale renaissance, this ability to tap into the permian and then move that to nations around the globe, particularly in asia where there is great interest in our natural gas. >> are u.s. consumers benefitting from this? how much of the product we are talking about is going overseas to other markets how much because of issues with pipelines, transportation that correct kind of facilities thinking even about the refiners are set up for the heavy crude
imported from places like venezuela. what more can be done so the u.s. consumer reaps the benefit of all of this >> keep in mind that when we increase our production that's more jobs here, that's more into our local economy and that's good there, as well. it's also good from a balance of trade perspective that we are able to export but you speak to a capacity restraint that's very, very real here in this country and the lower 48 particularly. in the northeast where you're not able to enjoy the benefits of that lower cost gas if you can't get it to your state. these are issues that we need to reconcile working with the energy regulatory commission, working through the congress but capacity and infrastructure is going to be key for us as we capitalize on our energy potential. >> the inability to get it to your state as you point out is one thing but the unwillingness of certain states in the
northeast, new york among them, to sanction fracking is another. and it goes to the heart of the critics of the fracking boom who say that there's a tremendous amount of water that's used to produce the gas, that the groundwater can be contaminated by it and what do you do with the waste water at the end of it and all legitimate environmental risks that we need to get right to protect the environment some people think we are some people we are not what do you say? are we hitting the right balance? >> well, i will tell you that what we are seeing around the country as we are going after this shale gas using fracking technology, keep in mind is different in different parts of the country. you have got different geology and so making sure that we, quote, get it right is often going to depend on where you are. but i will suggest to you the technology that is we are seeing now, being utilized in this
country to access this are ten years ago we could not have dreamed that we would be in this place, that we are able to export to the level that we are because of these vast quantities that come to us. it is the technologies that got us here and our technologies that will allow us to ensure from an environmental perspective, from a water perspective that we are doing it right and we are doing it soundly. >> senator, just a couple days ago you penned an op-ed with democratic senator joe manchin basically saying as long as you were in the senate you support the u.s. move away from greenhouse gas emissions, reducing emissions and you sort of swiped at the green new deal without mentioning it saying there's measures put forth drastic and not passable at the same time you didn't put forth any of your own specific proposals so is there a realistic green deal to be coming that you will co-sponsor
in some way? >> what i am working towards and working aggressively towards within the energy and natural resources committee along with my ranking member is we want the get to those pragmatic honest solutions that are going to make a difference to reducing our emissions in this country. so that we get to that goal that we want to achieve which is the environmental balance, if you will, but moving towards an economy that is strong while at the same time we're being the environmental stewards that i think everyone wants us to be. so we are working on building out those technologies, whether it's carbon capture and ute illization, focus on storage, advances in our renewables, the technologies to go after the extractive resources this is the direction that will get you results. i'm not interested in messaging
votes about where you are or where you aren't we are here. we are in the present. we are to deal with our environmental challenges we have to make sure that we are a strong economy and we can do this but we got to tone down the rhetoric you can come to the energy and natural resources committee in the senate for one of those good dialogues and honest debates about where and how we move forward. >> okay. senator thanks so much for your time today. >> thank you good to be with you. >> senator murkowski from alaska tomorrow, brian sullivan with an exclusive with the secretary of state mike pompeo and the energy secretary rick perry all tomorrow night beginning on cnbc asia >> check please is next. when you look at the critical issues facing our world, what do you see? we see a billion more people breathing free.
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and appropriate action so that is the latest on that tragic air crash over in ethiopia. >> as boeing is dramatically paired the losses in today's session and interesting to see where it closes. thank you for watching "power lunch. >> "closing bell" will start right now. ♪ good afternoon welcome to the "closing bell." i'm wilfred frost. >> i'm morgan brennan in for sara eisen january retail sales higher than estimates. we'll get a read on the consumer when we speak with ceo first on cnbc. plus, we are taking you inside south by southwest for a look at some of tech's coolest new gadgets. bit of fun coming up with that story. let's check in on the markets. just under an hour left of trade. the dow is the laggard of the major indices because of boeing. it's paired the losses