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[00:00.000 --> 00:06.840]  Next on Squawk Box, reaction to quarterly numbers from Lyft.
[00:06.840 --> 00:12.220]  What challenges and changes to the road map could steer investors to the rideshare company?
[00:12.220 --> 00:14.540]  Squawk Box today 6 a.m. Eastern.
[00:14.540 --> 00:19.320]  Watch or listen live on the CNBC app.
[00:19.320 --> 00:21.460]  It's 5 a.m. at CNBC Global Headquarters.
[00:21.460 --> 00:23.440]  Here is your 5 at 5.
[00:23.440 --> 00:25.160]  Investors bracing for a higher open.
[00:25.160 --> 00:29.660]  As Fed Chairman Jay Powell heads back to Capitol Hill, what President Trump had to say about
[00:29.660 --> 00:32.240]  yesterday's testimony, that's coming up.
[00:32.240 --> 00:37.800]  And Boeing raising the red flag over a potential impact from the coronavirus outbreak.
[00:37.800 --> 00:42.360]  Lyft shares sinking this morning, why some investors say its CEO needs to get his priorities
[00:42.360 --> 00:43.360]  in order.
[00:43.360 --> 00:46.520]  We speak with an early investor in the company.
[00:46.520 --> 00:50.880]  And a new meeting for MAGA, what President Trump has to say about Silicon Valley's tech
[00:50.880 --> 00:51.880]  titans.
[00:51.880 --> 00:56.600]  And a slim win in New Hampshire, as Bernie Sanders claims victory in the grand estate
[00:56.600 --> 00:57.760]  yet again.
[00:57.760 --> 01:00.520]  Next Wednesday, February 12th, 2020.
[01:00.520 --> 01:12.880]  And World Wide Exchange begins right now.
[01:12.880 --> 01:13.880]  Good morning and welcome.
[01:13.880 --> 01:14.880]  I'm Courtney Reagan.
[01:14.880 --> 01:18.920]  And this morning for Brian Sullivan, your chart of the day, it's kind of an ugly one.
[01:18.920 --> 01:21.000]  Shares of Bed Bath and Beyond sinking.
[01:21.000 --> 01:23.720]  Look at this, more than 20% here.
[01:23.720 --> 01:26.880]  The company announcing preliminary guidance for its fourth quarter.
[01:26.880 --> 01:28.920]  Going in well below expectations.
[01:28.920 --> 01:30.400]  Much more on that a moment.
[01:30.400 --> 01:34.320]  We're going to give you a look at how futures are looking on this Wednesday morning.
[01:34.320 --> 01:39.040]  Stocks do look to open in record territory here this morning with the Dow Jones Industrial
[01:39.040 --> 01:42.000]  Average indicated higher by more than 106 points.
[01:42.000 --> 01:48.240]  The S&P 500 higher by almost 12 and the NASDAQ tacking on an extra 47 points in the early
[01:48.240 --> 01:49.240]  going.
[01:49.240 --> 01:51.440]  Let's get a check in the fixed income market.
[01:51.440 --> 01:55.540]  Take a look at the yield on bonds and look at the 10 year, which we're seeing tick higher
[01:55.540 --> 02:02.080]  again here today at 1.620 after we'd seen that yield fall for several sessions in a
[02:02.080 --> 02:07.240]  row as perhaps flashing some warning signs that the equity market wasn't quite seeing.
[02:07.240 --> 02:11.680]  Let's go worldwide now and take a look at the green arrows really around the world in
[02:11.680 --> 02:15.920]  Asia, Japan, China, you name it, pretty much higher across the board.
[02:15.920 --> 02:17.880]  Hangs saying higher by nine tenths of a percent.
[02:17.880 --> 02:22.520]  The Shanghai composite higher by about the same in the Japanese Nikkei adding on three
[02:22.520 --> 02:25.680]  quarters of a point.
[02:25.680 --> 02:28.180]  And let's take a look at Europe in the early going.
[02:28.180 --> 02:32.640]  Also some green arrows across the world around the world in Europe.
[02:32.640 --> 02:37.360]  The German Zetradax higher by six tenths of a percent, FTSE 100 higher just marginally,
[02:37.360 --> 02:41.480]  but two tenths of a percent that counts as green and France higher by three tenths of
[02:41.480 --> 02:42.480]  a percent.
[02:42.480 --> 02:46.460]  Investors are waking up to a lot to chew on this morning, frankly, Federal Reserve Chairman
[02:46.460 --> 02:49.800]  Jay Powell under renewed pressure from President Trump.
[02:49.800 --> 02:51.800]  He heads back to the Hill today.
[02:51.800 --> 02:57.000]  Among his concerns, the coronavirus, which he says the central bank is actively monitoring
[02:57.000 --> 03:02.040]  as companies like Boeing and caring like new concerns over the outbreak.
[03:02.040 --> 03:04.720]  Earning season remains at the forefront as well.
[03:04.720 --> 03:10.400]  Names like Cisco, Walmart and Deere, those are still on deck and a far left win in New
[03:10.400 --> 03:16.360]  Hampshire last night for Bernie Sanders shaking up the Democratic presidential field.
[03:16.360 --> 03:20.880]  Joining me now, clear nomics founder and head of research, James Lew, we got an awful lot
[03:20.880 --> 03:22.520]  to tackle here, James.
[03:22.520 --> 03:24.180]  Let's start with Chairman Powell.
[03:24.180 --> 03:28.720]  What do you expect from him today when he heads back to Capitol Hill, sort of more of
[03:28.720 --> 03:32.720]  what he said yesterday reiterated with the same or different words or a different message
[03:32.720 --> 03:33.720]  here today?
[03:33.720 --> 03:34.720]  Yeah.
[03:34.720 --> 03:35.720]  Good morning, Courtney.
[03:35.720 --> 03:36.720]  We think it's pretty much going to be the same message.
[03:36.720 --> 03:39.480]  I mean, the message from the Fed is that the economy is in good shape.
[03:39.480 --> 03:42.520]  There are these big uncertainties in the world as there always are.
[03:42.520 --> 03:45.320]  Last year it was trade, this year it's the coronavirus.
[03:45.320 --> 03:47.360]  These uncertainties are very hard to measure.
[03:47.360 --> 03:52.200]  But you look at last week's jobs report, very solid and the underlying trend is still good.
[03:52.200 --> 03:57.200]  So there's not much more that the Fed can do at the moment other than staying put.
[03:57.200 --> 04:00.700]  You also look at the market reaction and where Fed fund futures are.
[04:00.700 --> 04:06.080]  And while the market has cheered what the Fed has done over the last year, you also
[04:06.080 --> 04:10.360]  are seeing now the expectation that there will be some sort of rate cut maybe by the
[04:10.360 --> 04:13.840]  middle of the year and certainly at least one rate cut by the end of the year from the
[04:13.840 --> 04:14.840]  market.
[04:14.840 --> 04:18.120]  So that's something that's evolving over time and that's changed as uncertainties
[04:18.120 --> 04:19.960]  like coronavirus have taken shape.
[04:19.960 --> 04:22.800]  Does that feel appropriate to you to be talking about rate cuts again?
[04:22.800 --> 04:26.520]  I know that may be what the market is expecting, but is that what the economic data tells you
[04:26.520 --> 04:27.640]  might be appropriate?
[04:27.640 --> 04:28.880]  So not from our perspective.
[04:28.880 --> 04:32.880]  So we think that we're in a position where a wait and see approach probably is appropriate.
[04:32.880 --> 04:36.920]  But of course, you know, the market over the last 10 years has been trained to expect this
[04:36.920 --> 04:38.160]  Fed put.
[04:38.160 --> 04:41.480]  And I think from an economic perspective, you know, obviously there's a human toll
[04:41.480 --> 04:45.040]  and human tragedy for around coronavirus that we shouldn't overlook.
[04:45.040 --> 04:49.480]  But economically speaking, coronavirus couldn't have happened at a worse time.
[04:49.480 --> 04:53.920]  And that's because we had all this trade uncertainty affecting trade between U.S. and China and
[04:53.920 --> 04:56.280]  the global economic picture last year.
[04:56.280 --> 05:01.400]  And now this year, that that issue, especially the spread of coronavirus around the world,
[05:01.400 --> 05:03.680]  could in fact have a toll on economic growth as well.
[05:03.680 --> 05:06.280]  So from a timing perspective, it's not great.
[05:06.280 --> 05:07.280]  But these are big uncertainties.
[05:07.280 --> 05:08.960]  They're very hard to measure.
[05:08.960 --> 05:11.080]  And so the Fed should probably stay put.
[05:11.080 --> 05:14.200]  Now, the irony, of course, is that the markets are at all time highs and are basically trying
[05:14.200 --> 05:15.920]  to look through that at the moment.
[05:15.920 --> 05:16.920]  Absolutely.
[05:16.920 --> 05:19.760]  That is something that is so interesting and has a lot of us scratching our heads.
[05:19.760 --> 05:23.800]  I think the bond market was flashing maybe some warning signs that the equity market
[05:23.800 --> 05:24.800]  wasn't quite.
[05:24.800 --> 05:28.040]  But but to your point, it does seem as if we're looking through and Chairman Powell
[05:28.040 --> 05:32.760]  did use the word resilient, I believe, yesterday when he was talking about the U.S. economy's
[05:32.760 --> 05:37.000]  ability to sort of absorb some of these bigger global problems.
[05:37.000 --> 05:42.400]  Is that do you still feel like we are resilient when it comes to the U.S. economy, even after
[05:42.400 --> 05:45.360]  all these years of growth and accommodative policy?
[05:45.360 --> 05:46.560]  We do think that's the case.
[05:46.560 --> 05:51.080]  So the U.S., of course, has been the main engine of the last decade for global growth.
[05:51.080 --> 05:58.000]  Now, the challenge is that if many investors expect a big resurgence in global growth and
[05:58.000 --> 06:02.240]  also market performance, not just based on last year, but also where valuations are,
[06:02.240 --> 06:05.180]  then we will have to see other economies start to pick up slack.
[06:05.180 --> 06:09.180]  And so you think back to a year like 2017 when it wasn't just the U.S. doing well.
[06:09.180 --> 06:13.500]  We had people talking about global coordinated growth, global synchronized growth.
[06:13.500 --> 06:17.500]  And that was a year when not just U.S. markets performed well, but emerging markets and developed
[06:17.500 --> 06:18.500]  markets also.
[06:18.500 --> 06:21.360]  So I think that's the type of situation we would have to see.
[06:21.360 --> 06:25.120]  Of course, the coronavirus does potentially dent that a little bit.
[06:25.120 --> 06:28.120]  But the reality is it's very hard to measure that effect.
[06:28.120 --> 06:32.220]  You think about SARS and really those are backward looking academic studies.
[06:32.220 --> 06:38.760]  You can't just count up the number of items that weren't produced because of disease.
[06:38.760 --> 06:40.360]  It's also the deals that weren't done.
[06:40.360 --> 06:43.160]  It's the economic activity that could have happened that didn't happen.
[06:43.160 --> 06:44.480]  That's incredibly hard to measure.
[06:44.480 --> 06:48.960]  Ultimately speaking, you need this global growth to come back in order to justify what
[06:48.960 --> 06:51.120]  a lot of investors see in the market right now.
[06:51.120 --> 06:52.120]  All that makes a lot of sense.
[06:52.120 --> 06:53.600]  James, thanks for being here with us.
[06:53.600 --> 06:57.000]  Come back to World Wide Exchange and keep us updated when we have better estimates,
[06:57.000 --> 06:58.640]  maybe even if it isn't two years.
[06:58.640 --> 06:59.640]  Great.
[06:59.640 --> 07:00.640]  Thanks, Courtney.
[07:00.640 --> 07:05.600]  Now, Sanders is celebrating his first clear, albeit slim, win yesterday in yesterday's
[07:05.600 --> 07:06.960]  New Hampshire primary.
[07:06.960 --> 07:12.080]  The victory marks the second strong showing for Sanders as he and the remaining 2020 Democrats
[07:12.080 --> 07:14.880]  now shift their focus to Nevada and South Carolina.
[07:14.880 --> 07:17.880]  NBC's Alice Barr joins us again this morning.
[07:17.880 --> 07:20.380]  Good morning, Alice.
[07:20.380 --> 07:21.380]  Good morning, Courtney.
[07:21.380 --> 07:25.300]  And turnout was high here in New Hampshire, higher than back in 2016.
[07:25.300 --> 07:28.600]  That's of course good news for Democrats as they're trying to engage voters.
[07:28.600 --> 07:32.760]  You're also seeing the top tier of candidates shifting as they head into the next round
[07:32.760 --> 07:34.800]  of voting.
[07:34.800 --> 07:37.800]  Thank you.
[07:37.800 --> 07:42.360]  Senator Bernie Sanders riding high this morning off a first place finish in the first in the
[07:42.360 --> 07:43.760]  nation primary.
[07:43.760 --> 07:52.400]  This victory here is the beginning of the end for Donald Trump.
[07:52.400 --> 07:57.480]  Former Mayor Pete Buttigieg coming in a close second, roughly 4,000 votes behind.
[07:57.480 --> 08:03.240]  Thanks to you, a campaign that some said shouldn't be here at all has shown that we are here
[08:03.240 --> 08:06.940]  to stay.
[08:06.940 --> 08:12.600]  And Senator Amy Klobuchar placing third, delivering on momentum from a strong debate performance
[08:12.600 --> 08:14.840]  and rocketing into the top tier.
[08:14.840 --> 08:21.000]  We have beaten the odds every step of the way.
[08:21.000 --> 08:25.840]  Senator Elizabeth Warren looking for a path forward after a disappointing fourth place
[08:25.840 --> 08:26.840]  finish.
[08:26.840 --> 08:29.840]  This campaign is built for the long haul.
[08:29.840 --> 08:34.480]  While former Vice President Joe Biden landed in fifth, having already left New Hampshire
[08:34.480 --> 08:39.480]  before results came in, he spoke last night from South Carolina where he's counting on
[08:39.480 --> 08:42.280]  a rebound from a more diverse electorate.
[08:42.280 --> 08:45.880]  99.9 percent.
[08:45.880 --> 08:49.680]  That's the percentage of African American voters who have not yet had a chance to vote
[08:49.680 --> 08:50.680]  in America.
[08:50.680 --> 08:51.680]  Hey y'all.
[08:51.680 --> 08:52.680]  How's it going?
[08:52.680 --> 08:53.680]  Hi, Andrew.
[08:53.680 --> 08:54.680]  Thank you.
[08:54.680 --> 08:58.840]  This is narrowing, businessman Andrew Yang and Senator Michael Bennett both announcing
[08:58.840 --> 09:03.760]  they are dropping out as winners and losers emerge from New Hampshire, sharpening the
[09:03.760 --> 09:07.900]  picture of the race to November.
[09:07.900 --> 09:11.960]  At this point, coming out of the first two contests, Pete Buttigieg still has a slight
[09:11.960 --> 09:15.880]  lead in the delegate count, which will ultimately decide the nominee, though of course there
[09:15.880 --> 09:18.280]  is still a long way to go until that decision.
[09:18.280 --> 09:19.280]  Courtney?
[09:19.280 --> 09:20.280]  Absolutely.
[09:20.280 --> 09:21.280]  We've got a long road ahead.
[09:21.280 --> 09:22.920]  Alice, thanks for being here with us this morning.
[09:22.920 --> 09:28.920]  When we come back, forget travel, retail and tech, yet another industry sounding the alarm
[09:28.920 --> 09:33.280]  over the coronavirus outbreak, bracing for a possible supply chain shock.
[09:33.280 --> 09:39.440]  A mixed morning has SoftBank shares surging to a seven-month high, check out that, higher
[09:39.440 --> 09:41.880]  by 12 percent.
[09:41.880 --> 09:42.880]  Find out why next.
[09:42.880 --> 09:47.040]  And later, former Federal Reserve Board Governor Sarah Bloom Raskin is here.
[09:47.040 --> 09:50.600]  Her take on Powell's day one testimony and what we can expect from day two.
[09:50.600 --> 09:59.160]  A very busy hour, still ahead, when Worldwide Exchange returns.
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[10:59.360 --> 11:03.120]  Next on SquawkBox, the action to quarterly numbers from Lyft.
[11:03.120 --> 11:08.240]  What challenges and changes to the roadmap could steer investors to the rideshare company?
[11:08.240 --> 11:10.280]  SquawkBox, today, 6 a.m.
[11:10.280 --> 11:11.280]  Eastern.
[11:11.280 --> 11:13.800]  Watch or listen live on the CNBC app.
[11:13.800 --> 11:17.800]  Microsoft, Amazon, Alphabet, Igniting Tech.
[11:17.800 --> 11:22.800]  Goldman Sachs Lead Internet Analyst examines what could push the sector even higher.
[11:22.800 --> 11:24.160]  Squawk Alley, 11 a.m.
[11:24.160 --> 11:25.640]  Eastern today.
[11:25.640 --> 11:29.080]  Watch or listen live on the CNBC app.
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[12:30.960 --> 12:31.960]  Welcome back.
[12:31.960 --> 12:34.400]  Let's get to check on the latest news surrounding the coronavirus outbreak.
[12:34.400 --> 12:35.760]  Rahel Solomon is here.
[12:35.760 --> 12:36.960]  Rahel, how's it looking today?
[12:36.960 --> 12:37.960]  Hi, Courtney.
[12:37.960 --> 12:42.320]  The U.S. is now reporting the lowest number of new coronavirus cases in the Hubei province
[12:42.320 --> 12:43.320]  since the end of January.
[12:43.320 --> 12:46.000]  That, of course, is the epicenter of the outbreak.
[12:46.000 --> 12:49.480]  So officials say that 1,068 new cases are confirmed.
[12:49.480 --> 12:53.320]  That's down from a peak of more than 3,000 on February 4th.
[12:53.320 --> 12:57.520]  However, there have also been 94 new deaths reported in the region.
[12:57.520 --> 13:01.120]  Drug makers are also bracing for potential supply disruptions from China.
[13:01.120 --> 13:05.840]  The CEO of one of India's largest pharmaceutical companies is warning supplies would start
[13:05.840 --> 13:10.600]  running out by the end of this month unless China restarts production.
[13:10.600 --> 13:16.320]  China makes compounds that are used in antibiotics, painkillers, and also diabetes drugs.
[13:16.320 --> 13:20.320]  And Fed Chairman Jay Powell commenting on the impact of the coronavirus could have an
[13:20.320 --> 13:24.440]  impact on the global economy, testifying before Congress yesterday.
[13:24.440 --> 13:28.120]  Powell said that the U.S. economy appears to be resilient, as we just heard Courtney
[13:28.120 --> 13:36.160]  say to global headwinds, but that the Fed is also closely monitoring the situation.
[13:36.160 --> 13:41.760]  We know there will be effects on China through some part of the first half of the year and
[13:41.760 --> 13:47.420]  China's close neighbors and trade, major trading partners in Europe as well as Asia.
[13:47.420 --> 13:50.840]  And we know that there will be some, very likely be some effects on the United States.
[13:50.840 --> 13:53.880]  I think it's just too early to say.
[13:53.880 --> 13:57.900]  Also shares of Gucci's parent company, Caring, are hired today after reporting strong fourth
[13:57.900 --> 13:58.900]  quarter results.
[13:58.900 --> 14:04.000]  But the company also says that it has seen a serious drop in customer traffic in China.
[14:04.000 --> 14:07.440]  Caring says that it's shifting some inventory to other countries.
[14:07.440 --> 14:09.760]  Shares of Foxconn rising more than 3 percent today.
[14:09.760 --> 14:13.840]  This is on reports that it aims to resume half of its production in China by the end
[14:13.840 --> 14:14.840]  of the month.
[14:14.840 --> 14:19.360]  Reuters says that Foxconn is also shooting to be at 80 percent of capacity by sometime
[14:19.360 --> 14:20.360]  in March.
[14:20.360 --> 14:22.560]  You can see shares are up about 3 percent at pre-market.
[14:22.560 --> 14:26.800]  And Boeing is warning that the virus will hit the airline industry's profit this year.
[14:26.800 --> 14:31.400]  Speaking to reporters at the Singapore Air Show, a senior executive says that's due to
[14:31.400 --> 14:36.280]  travel restrictions and a 70 percent drop in capacity by Chinese airlines.
[14:36.280 --> 14:38.480]  And Courtney, you and I talked about this on rapid fire yesterday.
[14:38.480 --> 14:42.600]  Of course, if flights aren't going into China, of course, that hurts the airlines, but also
[14:42.600 --> 14:45.280]  a lot of the companies that do really well in those airports.
[14:45.280 --> 14:46.280]  Absolutely.
[14:46.280 --> 14:48.340]  I know the ripple effects, I think, are really hard to measure.
[14:48.340 --> 14:52.080]  And I have to actually give some of these companies credit for trying to measure it,
[14:52.080 --> 14:55.360]  even giving us some of these numbers, 70 percent, 80 percent, whether they're talking
[14:55.360 --> 14:56.960]  about a revenue hit.
[14:56.960 --> 14:57.960]  Trying to manage expectations.
[14:57.960 --> 14:58.960]  Yeah.
[14:58.960 --> 15:00.440]  And I think it's just going to be hard to really know.
[15:00.440 --> 15:04.120]  And as James Lew, our last guest, was saying, we may not know for several years down the
[15:04.120 --> 15:06.000]  road what the collective impact is.
[15:06.000 --> 15:07.760]  It's often pretty backward looking.
[15:07.760 --> 15:09.600]  But we've got to try to figure it out now.
[15:09.600 --> 15:10.600]  It's best we can.
[15:10.600 --> 15:11.600]  Thank you, Rahel.
[15:11.600 --> 15:12.600]  Sure.
[15:12.600 --> 15:13.600]  OK.
[15:13.600 --> 15:16.120]  Well, don't forget to watch CNBC's special coverage of the outbreak.
[15:16.120 --> 15:19.280]  This breaks down the fast-moving developments and the market impact.
[15:19.280 --> 15:22.760]  That's tonight at 7 p.m. Eastern Time.
[15:22.760 --> 15:28.440]  Well, still on deck, why investors may want to stay away from that beyond section this
[15:28.440 --> 15:29.440]  morning.
[15:29.440 --> 15:36.960]  Today's big number, $14 trillion.
[15:36.960 --> 15:40.000]  That's the total household debt in the U.S.
[15:40.000 --> 15:49.960]  It grew over $600 billion in 2019, making it the biggest annual increase in 12 years.
[15:49.960 --> 16:18.320]  And we look forward to seeing you back here tonight.
[16:19.960 --> 16:23.480]  DataDog has become the modern,
[16:23.480 --> 16:26.520]  modern and analytics platform in the cloud age.
[16:26.520 --> 16:28.720]  When we started DataDog nine years ago,
[16:28.720 --> 16:29.720]  our mission was to break down
[16:29.720 --> 16:31.640]  titles and bring teams together.
[16:31.640 --> 16:34.480]  Nearly 9,000 of the world's most innovative companies
[16:34.480 --> 16:36.080]  rely on our platform daily to run
[16:36.080 --> 16:38.080]  their business and their own customers.
[16:38.080 --> 16:40.440]  We see a massive opportunity in the years to come,
[16:40.440 --> 16:42.120]  and as we celebrate to this milestone,
[16:42.120 --> 16:44.560]  we are even more excited about the future.
[16:44.560 --> 16:50.520]  Congratulations DataDog.
[16:50.520 --> 16:54.840]  Every morning, bright and early,
[16:54.840 --> 16:58.280]  17,000 Edward Jones financial advisors
[16:58.280 --> 17:01.280]  come to work with one goal in mind.
[17:01.600 --> 17:07.560]  To treat their individual investors like individuals.
[17:07.760 --> 17:10.880]  To know what's important to them.
[17:10.880 --> 17:13.280]  To be their champion.
[17:13.280 --> 17:14.840]  Let's get started.
[17:14.840 --> 17:43.000]  Edward Jones, it's time for investing to feel individual.
[17:44.840 --> 17:49.520]  Shipskis, your skis delivered.
[18:14.840 --> 18:24.320]  Let's get a check on some of the stocks on the move today.
[18:24.320 --> 18:28.440]  SoftBank's third quarter profit was nearly wiped out by losses
[18:28.440 --> 18:33.360]  of its $100 billion vision at its $100 billion vision fund,
[18:33.360 --> 18:34.080]  I should say.
[18:34.080 --> 18:38.000]  The fund posting an operating loss of more than $2 billion.
[18:38.000 --> 18:41.640]  CEO Moshasan defending SoftBank's performance,
[18:41.640 --> 18:44.360]  saying the vision fund has gained about $3 billion
[18:44.360 --> 18:46.720]  on its investments since the beginning of the year.
[18:46.720 --> 18:50.520]  Now, this report did come after the close of Japanese trading,
[18:50.520 --> 18:53.120]  SoftBank of Sprint merger with T-Mobile.
[18:53.120 --> 18:54.840]  A lot going on there for SoftBank.
[18:54.840 --> 18:58.200]  Now, Western Union is reporting fourth quarter earnings
[18:58.200 --> 18:59.760]  and revenue that missed forecast.
[18:59.760 --> 19:01.760]  The company says the stronger dollar
[19:01.760 --> 19:04.280]  negatively impacted revenue.
[19:04.280 --> 19:06.640]  You can see shares down more than 6%
[19:06.640 --> 19:08.240]  and shares of Bed Bath and Beyond,
[19:08.240 --> 19:12.680]  a few plunging by more than 20%, actually down more than 25%
[19:12.680 --> 19:14.880]  after the retailer said fourth quarter sales
[19:14.880 --> 19:17.040]  were hit by increased promotions.
[19:17.040 --> 19:19.200]  Falling traffic and inventory issues,
[19:19.200 --> 19:21.680]  same store sales in December and January,
[19:21.680 --> 19:25.440]  those dropped more than 5% and that was more than expected.
[19:25.440 --> 19:27.400]  The CEO says the company is experiencing,
[19:27.400 --> 19:29.600]  quote, short-term pain and efforts
[19:29.600 --> 19:31.400]  to stabilize the business.
[19:31.400 --> 19:34.120]  That CEO is still sort of getting his feet under him,
[19:34.120 --> 19:36.200]  trying to figure out what that business is all about
[19:36.200 --> 19:37.920]  and frankly, how to fix it.
[19:37.920 --> 19:39.480]  Well, as we head to break, President Trump
[19:39.480 --> 19:44.240]  giving his MAGA slogan new meaning yesterday.
[19:44.240 --> 19:46.840]  And we have $4 trillion companies.
[19:46.840 --> 19:50.280]  One is Microsoft, one is Apple, one is Google, one is Amazon.
[19:50.280 --> 19:53.920]  So you have Amazon, Google, Apple and Microsoft.
[19:53.920 --> 19:57.040]  And so you have an M, you have an A, you have a G
[19:57.040 --> 20:00.560]  and you have an A, you have MAGA.
[20:00.560 --> 20:02.920]  The comments coming just hours after the FTC
[20:02.920 --> 20:06.480]  expanded its antitrust investigation into Big Tech
[20:06.480 --> 20:09.320]  over past acquisitions that may have hurt competition,
[20:09.320 --> 20:12.120]  consumers, and evaded regulatory scrutiny.
[20:12.120 --> 20:13.960]  We're back after this.
[20:19.360 --> 20:22.840]  Yes, I'm stuck in the middle with you.
[20:22.840 --> 20:26.960]  No one likes to feel stuck, boxed in or held back,
[20:26.960 --> 20:29.080]  especially by something like your cloud.
[20:29.080 --> 20:32.320]  It's a problem, but the IBM cloud is different.
[20:32.320 --> 20:35.680]  It's the most open and secure public cloud for business.
[20:35.680 --> 20:38.440]  It can manage all your apps and data anywhere.
[20:38.440 --> 20:41.240]  So it can help take on anything from rebooking flights
[20:41.240 --> 20:44.400]  on the fly to restocking shelves on demand
[20:44.400 --> 21:08.360]  without getting in your way.
[21:14.760 --> 21:18.240]  And try pure protein, delicious protein shakes.
[21:18.240 --> 21:20.160]  Trump's tariffs brought the Chinese to the table
[21:20.160 --> 21:22.200]  for a phase one trade deal that opened the door
[21:22.200 --> 21:24.880]  for US companies that want to compete fairly over there.
[21:24.880 --> 21:26.200]  If you read the 100 page agreement,
[21:26.200 --> 21:28.240]  you'll see many opportunities for businesses
[21:28.240 --> 21:29.920]  that could help balance our trade deficit.
[21:29.920 --> 21:32.600]  Watch or listen live on the CNBC app.
[21:34.080 --> 21:36.560]  Wondering which credit card is right for you?
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[22:33.120 --> 22:35.840]  That provides four times the coverage on computers
[22:35.840 --> 22:37.200]  and home office equipment.
[22:39.640 --> 22:41.760]  And covers the service line connections
[22:41.760 --> 22:46.760]  between your house and the street.
[22:49.200 --> 22:53.800]  I've been walking these streets so long,
[22:53.800 --> 22:57.000]  singing the same old song.
[22:57.000 --> 22:59.720]  Let's get a check on this morning's other headlines.
[22:59.720 --> 23:01.880]  NBC's Phillip Benna is in New York with the latest.
[23:01.880 --> 23:03.040]  Good morning, Phillip.
[23:03.040 --> 23:04.160]  Hey Courtney, good morning.
[23:04.160 --> 23:05.280]  In just a moment, we will tell you
[23:05.280 --> 23:06.640]  why that song was playing.
[23:06.640 --> 23:09.440]  A stunning turn of events in the Roger Stone case.
[23:09.440 --> 23:10.800]  Attorney General William Barr
[23:10.800 --> 23:12.640]  and his top aides at the Justice Department
[23:12.640 --> 23:15.880]  intervened reversing a stiff sentencing recommendation
[23:15.880 --> 23:17.800]  that federal prosecutors had filed.
[23:17.800 --> 23:20.560]  The decision coming after a tweet from the president
[23:20.560 --> 23:22.560]  called the seven to nine year recommendation,
[23:22.560 --> 23:25.120]  quote, a miscarriage of justice.
[23:25.120 --> 23:26.840]  All four prosecutors in the case
[23:26.840 --> 23:29.200]  have now dropped out in protest of the move.
[23:29.200 --> 23:32.040]  And one is leaving the Justice Department altogether.
[23:32.040 --> 23:35.040]  Actor Jussie Smollett is facing new charges this morning.
[23:35.040 --> 23:37.920]  The Empire star faces a new six count indictment
[23:37.920 --> 23:40.640]  charging he filed four separate false reports
[23:40.640 --> 23:43.240]  to Chicago police when he claimed last January
[23:43.240 --> 23:45.320]  the two masked gunman attacked him,
[23:45.320 --> 23:48.240]  insulted him with homophobic and racist slurs,
[23:48.240 --> 23:50.720]  and then looped a noose around his neck.
[23:50.720 --> 23:52.720]  The special prosecutor says a new investigation
[23:52.720 --> 23:54.720]  was launched after similar charges
[23:54.720 --> 23:56.640]  were abruptly dropped last year.
[23:56.640 --> 24:00.000]  Attorneys for Smollett have not yet responded.
[24:00.000 --> 24:02.560]  And it looks like the rhinestone cowboy
[24:02.560 --> 24:05.080]  is trading in his horse for a Toyota.
[24:05.080 --> 24:08.680]  This man from Crimea covered his car in those tiny gems,
[24:08.680 --> 24:11.720]  400,000 to be exact.
[24:11.720 --> 24:14.200]  Took him six months to complete a sparkly project,
[24:14.200 --> 24:16.120]  but he says it was a labor of love
[24:16.120 --> 24:18.200]  and he now plans to sell that car.
[24:18.200 --> 24:20.920]  He says that it would be a great prop for photo shoots.
[24:20.920 --> 24:24.400]  Although Courtney, I have no idea how he'd watch that.
[24:24.400 --> 24:26.240]  So Instagram worthy though.
[24:26.240 --> 24:28.480]  I like it sparkly.
[24:28.480 --> 24:29.920]  I mean, imagine all the photos
[24:29.920 --> 24:31.120]  you could take with that car.
[24:31.120 --> 24:33.480]  Thank you, totally bedazzled.
[24:33.480 --> 24:34.920]  Thank you, Phillip.
[24:34.920 --> 24:37.440]  Well still to come, why some say Lyft needs
[24:37.440 --> 24:39.400]  to get its priorities in order
[24:39.400 --> 24:42.560]  as that stock falls more than 4% this morning.
[24:42.560 --> 24:45.160]  Plus the Carlos Ghosn saga, far from over
[24:45.160 --> 24:49.240]  as Nissan takes a new swipe at its ousted former chairman.
[24:49.240 --> 24:51.800]  And a programming note, don't miss a CNBC exclusive
[24:51.800 --> 24:55.560]  with CVS health CEO, Larry Merlo on closing bell today
[24:55.560 --> 24:57.960]  as that company prepares to release results
[24:57.960 --> 24:59.920]  just after 7 a.m. Eastern time.
[24:59.920 --> 25:01.840]  Worldwide exchange is back after this.
[25:01.840 --> 25:07.480]  Over the phone.
[25:07.480 --> 25:09.720]  Rising energy costs are frustrating.
[25:09.720 --> 25:11.800]  Electricity rates continue to increase
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[25:13.600 --> 25:16.200]  It's also smart to prepare for power outages
[25:16.200 --> 25:18.000]  that can leave you in the dark.
[25:18.000 --> 25:20.480]  You need a solution that will help you save money,
[25:20.480 --> 25:23.840]  prepare for power outages and help the environment.
[25:23.840 --> 25:26.040]  Introducing the Generac Power Cell,
[25:26.040 --> 25:28.720]  a battery storage system that harnesses the power
[25:28.720 --> 25:31.440]  from the sun to help reduce your electric bill
[25:31.440 --> 25:34.760]  and provide backup power during utility power outages.
[25:34.760 --> 25:35.960]  With the battery storage solution,
[25:35.960 --> 25:38.320]  we're saving about $450 a month.
[25:38.320 --> 25:40.880]  Power Cell's revolutionary technology captures
[25:40.880 --> 25:43.440]  and stores electricity either from solar panels
[25:43.440 --> 25:44.960]  or the electrical grid.
[25:44.960 --> 25:48.200]  It allows you to use stored energy during peak demand times
[25:48.200 --> 25:50.200]  when electricity costs are high,
[25:50.200 --> 25:53.600]  which helps reduce your electric bill, saving you money.
[25:53.600 --> 25:55.200]  And when a power outage occurs,
[25:55.200 --> 25:58.880]  Power Cell is ready to supply backup power to your home.
[25:58.880 --> 26:02.280]  Power Cell's modular design allows for easy customization
[26:02.280 --> 26:03.960]  for any home or budget.
[26:03.960 --> 26:06.960]  And Power Cell is back with a 10-year limited warranty.
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[26:13.440 --> 26:16.320]  we've been experiencing a savings of $1,500 a year.
[26:16.320 --> 26:18.000]  Generac has been a trusted provider
[26:18.000 --> 26:21.000]  of backup power solutions since 1959
[26:21.000 --> 26:23.720]  and provides 24-7 customer support.
[26:23.720 --> 26:26.200]  The battery storage solution in combination with the solar
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[27:39.120 --> 27:41.320]  Stocks look poised to build on record highs
[27:41.320 --> 27:43.840]  as investors prep themselves for round two
[27:43.840 --> 27:45.160]  of Jay Powell on the Hill.
[27:45.160 --> 27:46.200]  Futures are higher.
[27:46.200 --> 27:49.680]  Bernie Sanders on top of the 2020 Democratic field
[27:49.680 --> 27:51.440]  following the win in New Hampshire,
[27:51.440 --> 27:53.800]  what his rise could mean for your money.
[27:53.800 --> 27:54.880]  And speaking of winners,
[27:54.880 --> 27:57.960]  the Westminster Dog Show crowns its champion,
[27:57.960 --> 27:59.880]  the pup that took best in show
[27:59.880 --> 28:02.720]  as the second half of World Wide Exchange starts now.
[28:04.200 --> 28:07.200]  ["When I Was Younger"]
[28:12.360 --> 28:13.720]  Welcome back to World Wide Exchange.
[28:13.720 --> 28:16.280]  I'm Courtney Reagan and this morning for Brian Sullivan.
[28:16.280 --> 28:17.920]  Here's our stock futures are looking
[28:17.920 --> 28:19.880]  halfway through the 5 a.m. hour.
[28:19.880 --> 28:21.000]  We gave you a sneak peek.
[28:21.000 --> 28:22.080]  We said they were higher
[28:22.080 --> 28:24.520]  in the Dow Jones Industrial Average is indicating
[28:24.520 --> 28:26.560]  a higher open to the tune of 106 points,
[28:26.560 --> 28:28.320]  the S&P 500 higher by 12,
[28:28.320 --> 28:31.160]  and then NASDAQ said to add about 46 points.
[28:31.160 --> 28:33.200]  Another busy day though, of course, ahead
[28:33.200 --> 28:36.200]  with Fed Chairman's testimony again on the Hill.
[28:36.200 --> 28:39.680]  Coronavirus earnings and the New Hampshire primary results,
[28:39.680 --> 28:42.120]  all of that on investors' radars.
[28:42.120 --> 28:43.360]  Let's take a look at the bond market.
[28:43.360 --> 28:47.200]  The yield on the 10-year sitting at 1.614%,
[28:47.200 --> 28:49.640]  taking slightly higher from the yield yesterday.
[28:49.640 --> 28:51.360]  Let's get a check on the Asian markets.
[28:51.360 --> 28:54.040]  We saw green arrows mostly around the world
[28:54.040 --> 28:56.360]  and as you can see across the board in Asia
[28:56.360 --> 28:59.080]  with Shanghai, Hang Seng, and the Japanese Nikkei,
[28:59.080 --> 29:01.520]  all higher, just under 1% though.
[29:01.520 --> 29:04.080]  European markets also indicating,
[29:04.080 --> 29:06.000]  or actually I should say they are open, right?
[29:06.000 --> 29:08.240]  They're a couple hours ahead of us, so they're higher.
[29:08.240 --> 29:10.960]  We've got the German Zetradax higher by 6 tenths of a percent,
[29:10.960 --> 29:13.160]  FTSE 100 higher by 3 tenths of a percent,
[29:13.160 --> 29:16.600]  and France is higher by 3 tenths of a percent as well.
[29:16.600 --> 29:18.640]  Let's get a look at some of the other top stories
[29:18.640 --> 29:19.760]  that we're following this morning.
[29:19.760 --> 29:21.040]  Rahel Solomon is here.
[29:21.040 --> 29:21.880]  Hi, Rahel.
[29:21.880 --> 29:22.720]  Hi, Courtney.
[29:22.720 --> 29:25.240]  So the saga between Nissan and Carlos Ghosn continues.
[29:25.240 --> 29:27.400]  So Nissan has filed a civil lawsuit in Japan
[29:27.400 --> 29:29.520]  against its former chairman, Carlos Ghosn.
[29:29.520 --> 29:31.520]  The automaker is seeking an initial amount
[29:31.520 --> 29:33.600]  of $90 million in the suit.
[29:33.600 --> 29:35.560]  The company says it's looking to recover
[29:35.560 --> 29:38.560]  monetary damages inflicted by Ghosn
[29:38.560 --> 29:40.920]  as a result of quote years of misconduct
[29:40.920 --> 29:42.800]  and fraudulent activity.
[29:42.800 --> 29:45.640]  Google kicks off a landmark legal case in Europe today.
[29:45.640 --> 29:48.640]  During the three-day hearing at Europe's second highest court,
[29:48.640 --> 29:51.840]  the company will seek to overturn three European Union
[29:51.840 --> 29:55.600]  antitrust fines that total roughly $9 billion.
[29:55.600 --> 29:58.440]  Decision is not expected until next year.
[29:58.440 --> 30:00.920]  And the Federal Aviation Administration is admitting
[30:00.920 --> 30:03.600]  that it has not effectively overseen systems
[30:03.600 --> 30:06.800]  for managing safety risks at Southwest Airlines.
[30:06.800 --> 30:08.120]  So this follows a new report
[30:08.120 --> 30:10.000]  from the US Department of Transportation's
[30:10.000 --> 30:13.800]  Office of Inspector General that blasted the FAA.
[30:13.800 --> 30:16.600]  The agency says that local FAA managers
[30:16.600 --> 30:19.080]  responsible for monitoring Southwest
[30:19.080 --> 30:21.080]  failed to ensure that the carrier complied
[30:21.080 --> 30:23.160]  with mandatory maintenance standards
[30:23.160 --> 30:26.920]  while incorporating 88 used jets into its fleet.
[30:26.920 --> 30:28.640]  Sheriffs of Southwest are lower this morning,
[30:28.640 --> 30:31.720]  as we can see, down about 1.2% in pre-market.
[30:31.720 --> 30:32.560]  Courtney.
[30:32.560 --> 30:33.560]  Well, thank you very much.
[30:33.560 --> 30:35.600]  We're gonna see you back a little later.
[30:35.600 --> 30:38.120]  Well, the 2020 Democrats are turning their attention
[30:38.120 --> 30:39.960]  to Nevada and South Carolina
[30:39.960 --> 30:41.600]  after Senator Bernie Sanders' victory
[30:41.600 --> 30:43.240]  in the New Hampshire primary.
[30:43.240 --> 30:45.120]  Sanders' win puts him near the top
[30:45.120 --> 30:47.160]  of the party's fractured presidential field,
[30:47.160 --> 30:50.240]  which is now smaller after yesterday's contest.
[30:50.240 --> 30:52.680]  CNBC's Kayla Toschi joins us now.
[30:52.680 --> 30:55.160]  Kayla, can you break down sort of where things stack up
[30:55.160 --> 30:56.240]  after the primary?
[30:56.240 --> 30:59.520]  It hasn't been so clear to all of us all along the way.
[30:59.520 --> 31:00.840]  Who's really the leader?
[31:02.520 --> 31:05.560]  Well, Sanders is victorious in New Hampshire
[31:05.560 --> 31:07.520]  after a clear victory last night
[31:07.520 --> 31:11.800]  after a chaotic run in Iowa just a week ago.
[31:11.800 --> 31:15.880]  Courtney, with 25.9% of the votes,
[31:15.880 --> 31:17.840]  Sanders can claim victory here,
[31:17.840 --> 31:20.560]  although notably his support in the state
[31:20.560 --> 31:22.280]  has been significantly eroded
[31:22.280 --> 31:24.760]  by the entrance of South Bend Mayor Pete Buttigieg
[31:24.760 --> 31:26.840]  and Minnesota Senator Amy Klobuchar,
[31:26.840 --> 31:30.320]  who essentially split the support that Sanders received
[31:30.320 --> 31:32.920]  here in the state in the 2016 cycles.
[31:32.920 --> 31:37.560]  Pete Buttigieg with 24.4% and Klobuchar with just shy
[31:37.560 --> 31:41.160]  of 20% after being largely written off just a week ago
[31:41.160 --> 31:43.280]  because of a lower tier trying to figure out
[31:43.280 --> 31:45.920]  whether she can sustain this momentum and how.
[31:45.920 --> 31:48.400]  Here's the Senator in New Hampshire last night.
[31:49.360 --> 31:51.840]  And tonight in New Hampshire,
[31:51.840 --> 31:55.200]  as everyone had counted us out,
[31:55.200 --> 31:58.560]  even a week ago, thank you, pundits,
[32:00.040 --> 32:03.440]  I came back and we delivered.
[32:06.840 --> 32:08.400]  Because of the fractured field,
[32:08.400 --> 32:09.760]  perhaps many were surprised
[32:09.760 --> 32:12.200]  at the low finish of Senator Elizabeth Warren
[32:12.200 --> 32:13.920]  and former Vice President Joe Biden,
[32:13.920 --> 32:17.920]  who with lower than 15% of support here in New Hampshire
[32:17.920 --> 32:21.200]  did not cross the threshold to get any delegates.
[32:21.200 --> 32:23.720]  Biden has already left New Hampshire
[32:23.720 --> 32:25.800]  to start campaigning in South Carolina,
[32:25.800 --> 32:28.680]  which is the next presidential state contest
[32:28.680 --> 32:30.560]  on February 22nd.
[32:30.560 --> 32:34.000]  He acknowledged that he has not been performing well
[32:34.000 --> 32:37.000]  in the race, but is leading and Latinos
[32:37.000 --> 32:38.920]  to hopefully improve his numbers.
[32:38.920 --> 32:41.560]  And finally, because of the performance in New Hampshire,
[32:41.560 --> 32:45.240]  we are seeing some presidential campaigns suspended.
[32:45.240 --> 32:48.080]  Both Andrew Yang and Senator Michael Bennett
[32:48.080 --> 32:50.400]  saying last night that it would be the end of the road
[32:50.400 --> 32:51.760]  for their campaigns.
[32:51.760 --> 32:54.840]  So we are seeing the race narrow slightly, Courtney,
[32:54.840 --> 32:58.160]  but we still have more than a handful in the running.
[32:58.160 --> 33:00.280]  Yeah, Kayla, and yesterday I know you were telling us
[33:00.280 --> 33:03.160]  that at least that sort of ceremonial first votes,
[33:03.160 --> 33:05.320]  they went to Mayor Bloomberg,
[33:05.320 --> 33:07.440]  but I didn't hear you sort of mention
[33:07.440 --> 33:08.560]  how it all shook out for him.
[33:08.560 --> 33:10.000]  I guess that was all he got.
[33:12.560 --> 33:17.560]  Yeah, and certainly that was more of a novelty vote,
[33:17.880 --> 33:20.760]  Dixville not just casting a handful of votes.
[33:20.760 --> 33:24.120]  Certainly he has been spending ad money here in the state.
[33:24.120 --> 33:26.720]  He has been gaining traction in national polls,
[33:26.720 --> 33:28.680]  but Courtney, he hasn't really been spending
[33:28.680 --> 33:29.960]  any time in the state.
[33:29.960 --> 33:32.720]  He may in the future, there are some reports
[33:32.720 --> 33:36.560]  that he is increasing his staff here in New Hampshire
[33:36.560 --> 33:38.480]  and opening an office here,
[33:38.480 --> 33:42.120]  but he has not really been campaigning here at all.
[33:42.120 --> 33:45.320]  He will appear on his first debate stage of the cycle
[33:45.320 --> 33:47.200]  next week in Nevada.
[33:47.200 --> 33:49.760]  That is certainly something every campaign
[33:49.760 --> 33:50.880]  is preparing for.
[33:50.880 --> 33:52.200]  This is so interesting, Kayla.
[33:52.200 --> 33:55.160]  Thank you very much for bringing it to us this morning.
[33:55.160 --> 33:56.920]  This is going to continue to unfold
[33:56.920 --> 33:59.040]  in the weeks and the months ahead.
[33:59.040 --> 34:00.880]  Well, for more on Senator Sanders' victory
[34:00.880 --> 34:03.040]  and what it means for the election and your money,
[34:03.040 --> 34:04.240]  I'm joined by Jeff Mills.
[34:04.240 --> 34:06.960]  He's Chief Investment Officer at Bryn Mawr Trust
[34:06.960 --> 34:08.360]  and Jimmy Pathakoukas.
[34:08.360 --> 34:11.800]  Economic Analyst at the American Enterprise Institute.
[34:11.800 --> 34:14.880]  Both of these gentlemen are CNBC contributors.
[34:14.880 --> 34:16.520]  Jimmy, I guess I'm gonna start with you
[34:16.520 --> 34:18.520]  just to give us kind of the lay of the land
[34:18.520 --> 34:20.600]  and how you think everything shook up last night.
[34:20.600 --> 34:22.200]  So I understand Mr. Sanders won,
[34:22.200 --> 34:24.120]  but by a relatively narrow margin.
[34:24.120 --> 34:26.120]  So what does this mean going forward?
[34:26.120 --> 34:28.720]  Biden's already moved on to South Carolina.
[34:28.720 --> 34:29.560]  What's happening here?
[34:29.560 --> 34:31.720]  Who's gonna be the Democratic front runner?
[34:31.720 --> 34:33.880]  Well, what happened was that we had a front runner
[34:33.880 --> 34:37.360]  who as it turns out is really bad at running for president.
[34:37.360 --> 34:39.200]  I don't think Joe Biden's ever done better
[34:39.200 --> 34:41.960]  than about a fourth place finish in a primary.
[34:41.960 --> 34:43.680]  He looks like he barely has a pulse
[34:43.680 --> 34:45.520]  and we have a very weak front runner
[34:45.520 --> 34:48.680]  in a very fractured field.
[34:48.680 --> 34:51.760]  And listen, if you were gonna come up with a scenario
[34:51.760 --> 34:54.920]  where somebody who has unlimited money to spend
[34:54.920 --> 34:58.480]  can jump in, shake the whole thing up, maybe win,
[34:58.480 --> 35:02.480]  maybe create a brokered convention next summer,
[35:02.480 --> 35:03.800]  that's exactly what you're seeing.
[35:03.800 --> 35:06.520]  You mentioned Mike Bloomberg at the end.
[35:06.520 --> 35:08.800]  I don't know what his scenarios were
[35:08.800 --> 35:10.920]  that he ends up as a Democratic nominee,
[35:10.920 --> 35:12.200]  but they couldn't look much better
[35:12.200 --> 35:13.560]  than what's happening right now.
[35:13.560 --> 35:16.600]  And so, Jeff, now that we hear everything Jimmy has to say
[35:16.600 --> 35:18.160]  and he's talking about a fractured field,
[35:18.160 --> 35:20.320]  I guess it's a little hard for investors
[35:20.320 --> 35:22.840]  to sort of make some of their bets with their money.
[35:22.840 --> 35:25.120]  But if it is Bernie Sanders,
[35:25.120 --> 35:27.400]  I mean, you couldn't be further different
[35:27.400 --> 35:29.680]  from the situation we have right now in the White House
[35:29.680 --> 35:31.920]  as far as economic policy is concerned.
[35:32.880 --> 35:34.120]  Yeah, no question.
[35:34.120 --> 35:36.800]  But I think the market has it about right.
[35:36.800 --> 35:38.120]  It continues to levitate
[35:38.120 --> 35:40.640]  even as Sanders has risen in the polls.
[35:40.640 --> 35:42.240]  But I think the bottom line is
[35:42.240 --> 35:44.600]  that no president has lost reelection
[35:44.600 --> 35:46.280]  when they've avoided a recession
[35:46.280 --> 35:48.840]  in the two years prior to that reelection bid.
[35:48.840 --> 35:51.080]  So in my estimation,
[35:51.080 --> 35:53.560]  you have a bottoming of global manufacturing.
[35:53.560 --> 35:55.760]  It looks like leading economic indicators
[35:55.760 --> 35:57.200]  are inflecting higher.
[35:57.200 --> 35:59.000]  If you look at earnings as an example,
[35:59.000 --> 36:02.120]  usually guidance for 2020 at this point in time
[36:02.120 --> 36:04.920]  would have been down by about 1.4%.
[36:04.920 --> 36:07.880]  Guidance is only down by about 4% so far.
[36:07.880 --> 36:09.960]  So fundamentally, things look good,
[36:09.960 --> 36:11.880]  which means we likely avoid a recession
[36:11.880 --> 36:13.080]  leading into reelection.
[36:13.080 --> 36:15.240]  So I think investors are looking toward
[36:15.240 --> 36:17.880]  another President Trump victory here.
[36:17.880 --> 36:19.480]  And usually when the incumbent wins,
[36:19.480 --> 36:22.680]  on average, the S&P 500 is up about 10%.
[36:22.680 --> 36:25.200]  When the incumbent loses, usually up about 3%.
[36:25.200 --> 36:26.600]  So a big gap there.
[36:26.600 --> 36:27.760]  But if you're playing the odds,
[36:27.760 --> 36:29.920]  it looks like a reasonably good scenario for markets.
[36:29.920 --> 36:31.600]  And I think that's how investors are acting
[36:31.600 --> 36:32.720]  at the current time.
[36:32.720 --> 36:35.080]  I mean, polls show that,
[36:35.080 --> 36:38.000]  or suggest that Bernie Sanders can be President Trump.
[36:38.920 --> 36:40.840]  A lot of investors look at those betting markets.
[36:40.840 --> 36:43.200]  Those betting markets have Trump the favorite.
[36:43.200 --> 36:45.120]  And even if Trump should lose
[36:45.120 --> 36:47.360]  and you have a President Sanders,
[36:47.360 --> 36:48.520]  we're not gonna get a wealth tax,
[36:48.520 --> 36:50.080]  probably unconstitutional.
[36:50.080 --> 36:50.920]  We're not gonna suddenly,
[36:50.920 --> 36:53.880]  we're not gonna outlaw all private insurance companies.
[36:53.880 --> 36:54.880]  So I think they're looking at,
[36:54.880 --> 36:57.520]  it's an unlikely scenario that Bernie Sanders wins.
[36:57.520 --> 36:59.760]  It's even more unlikely scenario
[36:59.760 --> 37:01.920]  that we go hashtag full socialism.
[37:01.920 --> 37:03.800]  And Jeff, as you follow along,
[37:03.800 --> 37:05.840]  you said you gave us some stats there
[37:05.840 --> 37:08.240]  about what happens when incumbent presidents win
[37:08.240 --> 37:10.160]  and then if they lose,
[37:10.160 --> 37:12.560]  the S&P 500 is up about 56%
[37:12.560 --> 37:15.200]  since Trump has been in office.
[37:15.200 --> 37:18.520]  I mean, but what would markets say
[37:18.520 --> 37:21.240]  about sort of looking at this very fractured field?
[37:21.240 --> 37:23.280]  I guess I'm still just not convinced
[37:23.280 --> 37:25.440]  that the markets are gonna behave the same way
[37:25.440 --> 37:27.760]  if the candidate is Bernie Sanders
[37:27.760 --> 37:31.080]  versus if the Democratic candidate is, say, Mike Bloomberg.
[37:31.960 --> 37:33.480]  Yeah, look, I mean, Jim mentioned it, right?
[37:33.480 --> 37:35.000]  If you look at the national polling,
[37:35.000 --> 37:38.600]  I think Sanders is ahead of Trump by something like 4%
[37:38.600 --> 37:40.760]  and that gap has actually widened a little bit.
[37:40.760 --> 37:44.320]  So I do think that even if it's just for a period of time,
[37:44.320 --> 37:47.440]  investors may need to react in a way
[37:47.440 --> 37:50.520]  that supposes that there could possibly be
[37:50.520 --> 37:52.040]  a Bernie Sanders president.
[37:52.040 --> 37:54.560]  So I think it could cause volatility in the near term.
[37:54.560 --> 37:56.440]  And honestly, I've been surprised
[37:56.440 --> 37:58.760]  that the catalysts the markets have been given thus far,
[37:58.760 --> 38:01.680]  whether it's coronavirus or Sanders surging in the polls,
[38:01.680 --> 38:03.760]  hasn't done more to shake the markets.
[38:03.760 --> 38:06.200]  I mean, if you look at what's going on right now,
[38:06.200 --> 38:08.960]  you've got the top 50 names in the S&P 500,
[38:08.960 --> 38:12.200]  some 13% above their long-term moving average.
[38:12.200 --> 38:13.560]  If you look under the surface,
[38:13.560 --> 38:15.240]  there's some breath deterioration.
[38:15.240 --> 38:18.720]  So we had 80% of names above the 50-day moving average,
[38:18.720 --> 38:19.800]  now only 60.
[38:19.800 --> 38:21.120]  So I think in the near term,
[38:21.120 --> 38:22.760]  whether it's the coronavirus,
[38:22.760 --> 38:24.640]  whether it's something in short-term prediction,
[38:24.640 --> 38:26.080]  I think if you look out ahead,
[38:26.080 --> 38:28.720]  it's just difficult to be too negative on a market
[38:28.720 --> 38:30.960]  where the liquidity backdrop is what it is
[38:30.960 --> 38:32.360]  via what central banks are doing.
[38:32.360 --> 38:34.000]  They continue to stand at the ready.
[38:34.000 --> 38:37.080]  And like I said, I think fundamentals on balance
[38:37.080 --> 38:39.040]  are actually looking better, not worse.
[38:39.040 --> 38:42.560]  Jimmy, looking forward as these primary contests roll on,
[38:42.560 --> 38:43.680]  do you think we're gonna continue
[38:43.680 --> 38:45.080]  to see such a fracture field?
[38:45.080 --> 38:47.160]  Or are these campaigns gonna start to pull together
[38:47.160 --> 38:50.360]  and voters start to sort of aggregate towards one candidate?
[38:50.360 --> 38:51.720]  Or is this just the way it's gonna be
[38:51.720 --> 38:53.040]  until we get to, like you said,
[38:53.040 --> 38:55.600]  the possibility of a brokered convention?
[38:55.600 --> 38:59.080]  Yeah, listen, I think if there wasn't a Mike Bloomberg
[38:59.080 --> 39:01.840]  sort of looming out there, you'd say at some point,
[39:01.840 --> 39:03.080]  listen, Sanders has, you know,
[39:03.080 --> 39:07.240]  he's won the votes in the caucus and the primary.
[39:07.240 --> 39:09.800]  The next couple of states look much better than him.
[39:09.800 --> 39:12.160]  I mean, in a normal situation,
[39:12.160 --> 39:14.440]  he kind of should be the Democratic nominee.
[39:14.440 --> 39:16.480]  People don't believe it because of his age,
[39:16.480 --> 39:18.160]  because of the socialism tag,
[39:18.160 --> 39:21.040]  and because we have this age bomb of money
[39:21.040 --> 39:24.640]  about to explode in this primary over the next few weeks.
[39:24.640 --> 39:26.320]  That's why I think this is still gonna be
[39:26.320 --> 39:29.800]  a very topsy-turvy field for quite a long time.
[39:29.800 --> 39:31.280]  Jeff Mills, Jimmy Pathakoukas,
[39:31.280 --> 39:33.000]  thank you both for joining us this morning.
[39:33.000 --> 39:34.320]  You know we're gonna keep talking to you
[39:34.320 --> 39:35.360]  for the months to come,
[39:35.360 --> 39:38.680]  because we have a lot to figure out, it seems.
[39:38.680 --> 39:41.400]  Well, shares of Lyft tumbling despite the company
[39:41.400 --> 39:43.520]  posting results that beat analysts' estimates.
[39:43.520 --> 39:46.200]  Fourth quarter revenue topping $1 billion
[39:46.200 --> 39:47.540]  for the first time ever.
[39:47.540 --> 39:50.400]  Investors, though, paying closer attention to the stock,
[39:50.400 --> 39:52.280]  following Uber's fourth quarter beat
[39:52.280 --> 39:54.520]  and updated profitability targets
[39:54.520 --> 39:56.400]  with shares of Lyft down 4%.
[39:56.400 --> 40:00.400]  CEO Logan Green didn't update Lyft's profitability timeline,
[40:00.400 --> 40:03.360]  but he did make it clear that it was among the key themes
[40:03.360 --> 40:05.500]  the company is focused on this year.
[40:06.920 --> 40:09.800]  We expect to deliver continued strong top-line growth
[40:09.800 --> 40:12.280]  in 2020 while also making progress
[40:12.280 --> 40:13.760]  on our path to profitability.
[40:14.680 --> 40:16.240]  As we've discussed on prior calls,
[40:16.240 --> 40:19.360]  there are three key themes that we're focused on.
[40:19.360 --> 40:21.200]  First is product innovation,
[40:21.200 --> 40:23.000]  second is profitable growth,
[40:23.000 --> 40:24.640]  and third is operating leverage.
[40:25.780 --> 40:27.200]  Joining me now, Santosh Rao.
[40:27.200 --> 40:30.080]  He is head of research at Manhattan Venture Partners.
[40:30.080 --> 40:32.480]  His firm was an early investor in Lyft.
[40:32.480 --> 40:34.060]  Okay, so you just heard Logan Green,
[40:34.060 --> 40:36.440]  profitability number two on his list.
[40:36.440 --> 40:37.640]  Should it be number one?
[40:38.720 --> 40:39.760]  Well, good morning.
[40:39.760 --> 40:42.200]  Good morning. Thanks for having me again.
[40:42.200 --> 40:44.200]  I think it's, no, they're on the right track.
[40:44.200 --> 40:45.200]  They're not in a rush.
[40:45.200 --> 40:47.400]  They don't want to pull in the timeline.
[40:47.400 --> 40:49.160]  And that's one of the reasons why we invested
[40:49.160 --> 40:50.720]  right from the beginning.
[40:50.720 --> 40:53.520]  We feel it's a pure play with a focused strategy,
[40:53.520 --> 40:55.080]  very disciplined strategy.
[40:55.080 --> 40:56.160]  So I think that's what they're doing.
[40:56.160 --> 40:58.080]  They're executing to that strategy.
[40:58.080 --> 40:59.320]  They're not in a rush.
[40:59.320 --> 41:00.960]  Like he said, profitable growth
[41:00.960 --> 41:04.620]  until the last quarter of 2021, they will be profitable.
[41:04.620 --> 41:07.560]  So I trust the numbers, I trust the CEO.
[41:07.560 --> 41:09.320]  So I think he's on the right track.
[41:09.320 --> 41:11.880]  And this quarter was a classic beat and raise,
[41:11.880 --> 41:13.360]  fourth quarter right off the gate,
[41:13.360 --> 41:15.600]  doing great with big numbers.
[41:15.600 --> 41:17.760]  So I think this company is on the right track
[41:17.760 --> 41:19.120]  and our thesis is proving out
[41:19.120 --> 41:20.600]  that this is the way to go in the right track.
[41:20.600 --> 41:21.440]  You're an early investor.
[41:21.440 --> 41:23.000]  Are you currently an investor in Lyft?
[41:23.000 --> 41:23.840]  No, we are not.
[41:23.840 --> 41:26.560]  I mean, we distribute the shares after the expiration,
[41:26.560 --> 41:29.080]  but we were early investors, like I said.
[41:29.080 --> 41:30.000]  Okay, okay.
[41:30.000 --> 41:32.360]  And so you mentioned that Lyft is a pure play
[41:32.360 --> 41:35.300]  and you mean because they don't have a Lyft Eats
[41:35.300 --> 41:36.720]  like an Uber Eats.
[41:36.720 --> 41:38.280]  But some people point to that
[41:38.280 --> 41:40.240]  as actually a really good thing for Uber.
[41:40.240 --> 41:41.520]  You don't think Lyft needs that?
[41:41.520 --> 41:42.480]  No, they don't need that.
[41:42.480 --> 41:44.760]  I mean, Uber Eats, its business is good,
[41:44.760 --> 41:45.860]  but it's competitive.
[41:45.860 --> 41:47.000]  That's the thing about Uber.
[41:47.000 --> 41:48.080]  Uber, it's a different game.
[41:48.080 --> 41:48.920]  It's a platform.
[41:48.920 --> 41:50.520]  It has a number of other businesses.
[41:50.520 --> 41:51.880]  Not all profitable.
[41:51.880 --> 41:53.600]  We don't know when they'll be profitable,
[41:53.600 --> 41:56.560]  but it's a broad platform.
[41:56.560 --> 41:59.400]  But I think the way to go is the right sharing business
[41:59.400 --> 42:02.060]  in North America, which has the best unit economics.
[42:02.060 --> 42:04.160]  So this is right, focused very well
[42:04.160 --> 42:07.680]  with the optionality later on of going into other businesses.
[42:07.680 --> 42:09.960]  I would rather go that way than go this way
[42:09.960 --> 42:11.720]  because there's a lot more to do here.
[42:11.720 --> 42:12.980]  The market is big.
[42:12.980 --> 42:15.320]  There's a huge opportunity out there.
[42:15.320 --> 42:18.000]  It's still a lot more to go, still early stages.
[42:18.000 --> 42:19.600]  So I think they need the resources
[42:19.600 --> 42:21.600]  and the attention to execute here
[42:21.600 --> 42:24.680]  and then later on try to go into other businesses,
[42:24.680 --> 42:26.520]  if needed, but they don't need to.
[42:26.520 --> 42:28.920]  So a really important part of North America is California
[42:28.920 --> 42:30.240]  because it's a huge state
[42:30.240 --> 42:33.240]  and we've got this gig worker law on the books
[42:33.240 --> 42:35.340]  that these ride sharing companies and a number of others
[42:35.340 --> 42:37.180]  are just not thrilled with, frankly.
[42:37.180 --> 42:39.200]  I mean, how big of a threat is this
[42:39.200 --> 42:42.360]  and will this continue to be an overhang for investors?
[42:42.360 --> 42:44.880]  Yeah, I think it's still playing out.
[42:44.880 --> 42:46.840]  Lyft is banking on a ballot initiative.
[42:46.840 --> 42:48.680]  They're confident that they can win,
[42:48.680 --> 42:49.820]  but let's see where that plays out.
[42:49.820 --> 42:52.320]  California is not the biggest part of the market.
[42:52.320 --> 42:55.000]  I mean, it's big, but it's not all the business.
[42:55.000 --> 42:57.000]  I mean, there's a lot of other businesses around.
[42:57.000 --> 42:58.480]  So there'll be some hit,
[42:58.480 --> 43:02.040]  small percentage of the total earnings, I guess.
[43:02.040 --> 43:05.360]  But overall, I think we'll see.
[43:05.360 --> 43:07.520]  I think the genie's out of the bag.
[43:07.520 --> 43:09.480]  You cannot take this back.
[43:09.480 --> 43:11.520]  Ride sharing is the way to go for the future.
[43:11.520 --> 43:12.480]  Everyone wants that.
[43:12.480 --> 43:14.440]  There's a groundswell of support from bottom up.
[43:14.440 --> 43:17.200]  So you'll see at somewhere in between, you will settle.
[43:17.200 --> 43:19.040]  There will be a compromise somewhere,
[43:19.040 --> 43:21.440]  but in the end, you need gig economy.
[43:21.440 --> 43:22.840]  You need ride sharing.
[43:22.840 --> 43:23.800]  That's the way to go.
[43:23.800 --> 43:28.240]  Transportation as a service is a big part of the future.
[43:28.240 --> 43:29.320]  That's where we invested.
[43:29.320 --> 43:31.920]  That's why we thought this was the right place to go.
[43:31.920 --> 43:33.560]  So a lot of moving parts, Antosh.
[43:33.560 --> 43:34.400]  Thanks for being here with us this morning.
[43:34.400 --> 43:35.680]  Thank you, thanks for having me.
[43:35.680 --> 43:36.520]  Absolutely.
[43:36.520 --> 43:39.480]  Well, coming up, Netflix, making a rare move
[43:39.480 --> 43:42.600]  with the release of one highly anticipated sequel.
[43:42.600 --> 43:44.400]  Details on that and the other stories
[43:44.400 --> 43:46.280]  you're gonna be talking about, that's ahead.
[43:46.280 --> 43:48.280]  And coming up in a CNBC exclusive,
[43:48.280 --> 43:51.440]  Goldman Sachs CEO, David Solomon joins Closing Bell
[43:51.440 --> 43:53.240]  as the bank's annual internet
[43:53.240 --> 43:55.440]  and technology conference kicks off
[43:55.440 --> 43:57.040]  at the 4 p.m. Eastern time.
[43:57.040 --> 43:59.080]  Worldwide exchange though, back in just a moment.
[43:59.080 --> 44:01.040]  Still no stopping, breaking, check the clock at three,
[44:01.040 --> 44:03.600]  they're right on where they wanna be in four o'clock.
[44:03.600 --> 44:06.560]  Racing has taken me all over the world,
[44:06.560 --> 44:10.760]  but when I put on the helmet, I am still in India.
[44:10.760 --> 44:13.240]  India, where I found yoga.
[44:13.240 --> 44:15.560]  Slow down, breathe.
[44:15.560 --> 44:18.320]  I have breathed in India's magic.
[44:18.320 --> 44:19.560]  I have felt its warmth.
[44:20.880 --> 44:25.280]  Yoga has taught me the truth about life and motorcycles.
[44:26.480 --> 44:30.200]  That the more still you are, the further you can go.
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[45:39.320 --> 45:42.680]  with portfolio managers focused on the long-term.
[45:42.680 --> 45:45.680]  Who look beyond the spreadsheets to understand companies
[45:45.680 --> 45:48.680]  from break room to board room.
[45:48.680 --> 45:51.040]  Who know the only way to get a 360 view
[45:51.040 --> 45:53.160]  is to go around the world to get it.
[45:53.160 --> 45:54.840]  Can I rely on deep research
[45:54.840 --> 45:57.560]  to help make quality investment decisions?
[45:57.560 --> 46:00.080]  With Capital Group, I can.
[46:00.080 --> 46:01.600]  Talk to your advisor or consultant
[46:01.600 --> 46:03.760]  for investment risks and information.
[46:03.760 --> 46:07.720]  Evens meant to be, it'll be, it'll be.
[46:07.720 --> 46:08.840]  Let's find out what else
[46:08.840 --> 46:10.760]  you're going to be talking about today.
[46:10.760 --> 46:13.040]  It is time for this morning's top stories.
[46:13.040 --> 46:14.000]  Rahel Solomon is back.
[46:14.000 --> 46:14.840]  What do we got today?
[46:14.840 --> 46:17.560]  Okay, so Twitter is in an uproar about this next one.
[46:17.560 --> 46:18.680]  The Westminster Dog Show
[46:18.680 --> 46:20.840]  wrapped up two days of competition last night
[46:20.840 --> 46:23.840]  and handed out its coveted Best in Show award.
[46:23.840 --> 46:27.000]  And the winner was this standard poodle named Seba.
[46:27.000 --> 46:27.960]  Cute, right?
[46:27.960 --> 46:29.560]  So Seba's the first standard poodle
[46:29.560 --> 46:32.480]  to win Top Dog of the show since 1991.
[46:32.480 --> 46:35.160]  Also the fifth to win in Westminster history.
[46:35.160 --> 46:38.440]  Seba, however, upset crowd favorite Daniel.
[46:38.440 --> 46:39.280]  Let's wait for this.
[46:39.280 --> 46:42.040]  This is a golden retriever who took home first.
[46:42.040 --> 46:43.120]  This is still Seba, of course,
[46:43.120 --> 46:45.400]  who took home first in the competition's sporting group.
[46:45.400 --> 46:47.400]  Well, let me tell you, Daniel, there's Daniel.
[46:47.400 --> 46:48.520]  Very cute.
[46:48.520 --> 46:49.640]  So here's the issue.
[46:49.640 --> 46:52.600]  Apparently a golden retriever has never won.
[46:52.600 --> 46:55.440]  And so it was the underdog, no pun intended.
[46:55.440 --> 46:57.360]  And so folks really wanted Daniel to win.
[46:57.360 --> 47:01.000]  They also thought Daniel was a cuter, more doggy dog.
[47:01.000 --> 47:01.840]  Right, right, right.
[47:01.840 --> 47:02.660]  But apparently, so that's not
[47:02.660 --> 47:04.140]  what the judges are looking for.
[47:04.140 --> 47:06.040]  They're judging to see which dog
[47:06.040 --> 47:08.760]  is closest to the ideal breed.
[47:08.760 --> 47:09.600]  Like it's breed.
[47:09.600 --> 47:10.760]  It's own breed.
[47:10.760 --> 47:13.600]  They're not measuring Daniel against Seba.
[47:13.600 --> 47:14.680]  Exactly.
[47:14.680 --> 47:17.280]  They're measuring Seba against standard poodles
[47:17.280 --> 47:19.720]  and Daniel against golden retrievers.
[47:19.720 --> 47:22.000]  And apparently the judges felt like Seba
[47:22.000 --> 47:24.560]  was closer to the ideal standard poodle.
[47:24.560 --> 47:25.400]  They're both cute.
[47:25.400 --> 47:26.360]  They can both win.
[47:26.360 --> 47:28.260]  And speaking as an owner of a golden doodle,
[47:28.260 --> 47:30.160]  I love both breeds, clearly.
[47:30.160 --> 47:33.000]  Yes, also Netflix giving non-subscribers now
[47:33.000 --> 47:36.120]  a freebie amid one highly anticipated release.
[47:36.120 --> 47:37.800]  The company's 2018 original,
[47:37.800 --> 47:39.720]  to all the boys that I've loved before,
[47:39.720 --> 47:42.480]  will be available to stream regardless of whether or not
[47:42.480 --> 47:44.720]  you are a paid user through March 9th.
[47:44.720 --> 47:47.480]  So the move comes as a sequel to the hit Romcom,
[47:47.480 --> 47:49.340]  officially hits the platform today.
[47:49.340 --> 47:50.880]  And this is the first time that Netflix
[47:50.880 --> 47:52.120]  has offered free streaming
[47:52.120 --> 47:54.100]  for one of its originals in the US.
[47:54.100 --> 47:56.400]  Will be very interesting to see
[47:56.400 --> 47:58.040]  if this leads to more subscribers.
[47:58.040 --> 47:59.920]  Because think about it, if you've watched now
[47:59.920 --> 48:02.000]  the first one and you're into it,
[48:02.000 --> 48:05.160]  you'd be more willing to pay to see the second one.
[48:05.160 --> 48:07.120]  They say it's a hit, and I love Romcoms,
[48:07.120 --> 48:09.200]  I have not heard of this nor have I seen it.
[48:09.200 --> 48:11.400]  So I've totally missed that boat.
[48:11.400 --> 48:13.600]  We may have aged out though, you and I.
[48:13.600 --> 48:16.160]  I mean, I'm with you though, I'm with you.
[48:16.160 --> 48:19.360]  Pizza Hut, serving up another interesting innovation.
[48:19.360 --> 48:21.480]  The chain announced that it's newest product,
[48:21.480 --> 48:23.360]  the Mozzarella Poppers Pizza.
[48:23.360 --> 48:26.180]  It comes with 16 mozzarella filled squares
[48:26.180 --> 48:27.520]  baked right into the pizza crust,
[48:27.520 --> 48:29.140]  like right on top of this, you see there.
[48:29.140 --> 48:32.680]  The restaurant is calling it the cheesiest pizza yet.
[48:32.680 --> 48:34.480]  Bold claim considering that the chain
[48:34.480 --> 48:36.640]  was also behind the stuffed crust pizza.
[48:36.640 --> 48:38.480]  This also comes a week after Papa John's
[48:38.480 --> 48:41.280]  launched its innovation, the Papadilla.
[48:41.280 --> 48:43.720]  I do remember all of those innovations,
[48:43.720 --> 48:45.200]  and it does sort of get you interested.
[48:45.200 --> 48:47.680]  I feel like everybody's, I shouldn't say everybody,
[48:47.680 --> 48:48.840]  a lot of people try it once.
[48:48.840 --> 48:50.400]  I don't know if you keep going back to it,
[48:50.400 --> 48:52.800]  like does the mozzarella stuffed crust
[48:52.800 --> 48:54.160]  become your go-to pizza?
[48:54.160 --> 48:55.000]  Probably not, right?
[48:55.000 --> 48:56.120]  Or maybe it's just a novelty, right?
[48:56.120 --> 48:57.680]  Like maybe you just try it once, as you said.
[48:57.680 --> 48:58.520]  Exactly.
[48:58.520 --> 48:59.640]  And you're just like, okay, it's a lot of mozzarella.
[48:59.640 --> 49:01.120]  But maybe that's all they need.
[49:01.120 --> 49:02.760]  Interesting, I love cheese.
[49:02.760 --> 49:04.480]  I would definitely be willing to try it.
[49:04.480 --> 49:05.520]  Hear, hear.
[49:05.520 --> 49:07.680]  Well, on deck, Boeing issues a new warning
[49:07.680 --> 49:10.000]  over the coronavirus and the major economic impact
[49:10.000 --> 49:11.920]  the outbreak will likely have.
[49:11.920 --> 49:13.880]  Plus, what investors should take away
[49:13.880 --> 49:15.400]  from Jay Powell's latest comments
[49:15.400 --> 49:17.880]  before he testifies to Congress again this morning,
[49:17.880 --> 49:19.840]  we'll talk to former Fed governor,
[49:19.840 --> 49:22.040]  Sarah Bloom Raskin, that's coming up next.
[49:22.040 --> 49:24.880]  And a reminder, you can always watch or listen to us live
[49:24.880 --> 49:26.680]  on the go on the CNBC app.
[49:26.680 --> 49:36.680]  Worldwide Exchange is back in just a moment.
[49:56.680 --> 50:04.840]  When it comes to your business internet,
[50:04.840 --> 50:06.440]  which is more important?
[50:06.440 --> 50:11.200]  I wish I didn't have to choose.
[50:11.200 --> 50:12.160]  Like the more I think about it,
[50:12.160 --> 50:13.840]  the more I want to jump to each room.
[50:13.840 --> 50:16.760]  What if I said you can have it all?
[50:16.760 --> 50:20.360]  Comcast business gives you connectivity that goes beyond.
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[51:29.640 --> 51:46.360]  It's now time for the executive recap,
[51:46.360 --> 51:48.600]  the headlines you need in 60 seconds.
[51:48.600 --> 51:51.960]  Foxconn is aiming to restart half its production operations
[51:51.960 --> 51:53.840]  in China by the end of the month
[51:53.840 --> 51:55.200]  amid the coronavirus outbreak.
[51:55.200 --> 51:58.120]  According to Reuters, the company is working to boost
[51:58.120 --> 51:59.840]  that number to 80% in March.
[51:59.840 --> 52:02.920]  Foxconn received approval from Chinese authorities this week
[52:02.920 --> 52:05.720]  to reopen its largest plants.
[52:05.720 --> 52:07.520]  Meanwhile, Boeing is issuing a warning
[52:07.520 --> 52:09.360]  about the impact of the coronavirus,
[52:09.360 --> 52:11.720]  speaking to reporters at the Singapore Air Show.
[52:11.720 --> 52:14.520]  A senior executive says the global air cargo industry
[52:14.520 --> 52:17.680]  is unlikely to grow this year because of challenges
[52:17.680 --> 52:20.080]  in China stemming from that outbreak.
[52:20.080 --> 52:23.200]  Boeing is also warning that the virus will hit airline revenues
[52:23.200 --> 52:26.640]  and profits shares of Boeing down only fractionally.
[52:26.640 --> 52:29.640]  And a federal judge has dismissed some of the charges
[52:29.640 --> 52:32.000]  against Theranos founder, Elizabeth Holmes.
[52:32.000 --> 52:35.080]  The judge ruled patients were not deprived of any money
[52:35.080 --> 52:38.200]  or property by using the company's blood testing services.
[52:38.200 --> 52:41.280]  And there was no evidence showing Holmes directed doctors
[52:41.280 --> 52:44.360]  to make misrepresentations to their patients.
[52:44.360 --> 52:47.040]  The judge did uphold wire fraud charges, however,
[52:47.040 --> 52:48.960]  against Holmes.
[52:48.960 --> 52:51.480]  Well, as stock futures point to new records for Wall Street
[52:51.480 --> 52:53.560]  at the open, investors also looking ahead
[52:53.560 --> 52:55.200]  to a second day of testimony
[52:55.200 --> 52:57.720]  from Federal Reserve Chairman Jay Powell,
[52:57.720 --> 53:00.080]  expected to testify before the Senate Bank Committee
[53:00.080 --> 53:01.920]  at 9 a.m. Eastern time today,
[53:01.920 --> 53:03.760]  just one day after he said the central bank
[53:03.760 --> 53:06.760]  is closely monitoring the coronavirus outbreak.
[53:09.080 --> 53:11.880]  The question for us really is what will be the effects
[53:11.880 --> 53:13.320]  on the U.S. economy?
[53:13.320 --> 53:16.000]  Will they be persistent? Will they be material?
[53:16.000 --> 53:17.120]  That's really the question.
[53:17.120 --> 53:20.640]  I think we know there will be effects on China
[53:20.640 --> 53:22.960]  through some part of the first half of the year
[53:22.960 --> 53:26.720]  and China's close neighbors and major trading partners
[53:26.720 --> 53:28.680]  in Europe as well as Asia.
[53:28.680 --> 53:30.280]  And we know that there will be some,
[53:30.280 --> 53:32.240]  very likely be some effects on the United States.
[53:32.240 --> 53:33.920]  I think it's just too early to say.
[53:33.920 --> 53:37.760]  We have to resist the temptation to speculate on this.
[53:37.760 --> 53:39.960]  And so we'll be watching that carefully again.
[53:39.960 --> 53:41.320]  And the question we'll be asking is,
[53:41.320 --> 53:43.400]  will these be persistent effects
[53:43.400 --> 53:47.120]  that could lead to a material reassessment of the outlook?
[53:47.120 --> 53:50.400]  Joining me now with more is former Federal Reserve
[53:50.400 --> 53:52.760]  Board Governor and former Deputy Treasury Secretary
[53:52.760 --> 53:53.760]  Sarah Bloom Raskin.
[53:53.760 --> 53:55.480]  She's also a CNBC contributor
[53:55.480 --> 53:57.400]  and Duke University Rubenstein Fellow.
[53:57.400 --> 53:58.240]  Sarah, good morning.
[53:58.240 --> 53:59.880]  Thank you for being here with us today.
[53:59.880 --> 54:02.160]  You, of course, heard Mr. Powell.
[54:02.160 --> 54:04.560]  I'm sure you heard him say all of those things yesterday
[54:04.560 --> 54:07.520]  as we're trying to square up really the impact
[54:07.520 --> 54:09.440]  of the coronavirus saying we have to wait
[54:09.440 --> 54:10.560]  and see if it's material.
[54:10.560 --> 54:13.600]  It seems to me that there's no question it will be material.
[54:13.600 --> 54:16.760]  We just don't know perhaps to what degree.
[54:16.760 --> 54:17.600]  That's right.
[54:17.600 --> 54:22.600]  This virus actually does have quite the potential
[54:22.720 --> 54:26.640]  to really have some big knock on effects.
[54:26.640 --> 54:28.800]  If you think about certainly the impact,
[54:28.800 --> 54:31.640]  the economic impact on China itself,
[54:31.640 --> 54:34.960]  there is now speculation that that will knock off
[54:34.960 --> 54:37.480]  a couple of points of GDP growth there
[54:37.480 --> 54:40.040]  in terms of how they measure it.
[54:40.040 --> 54:43.720]  But the effects on the US and on the trading partners
[54:43.720 --> 54:47.320]  for China are also really what we have to keep an eye on.
[54:47.320 --> 54:49.720]  You heard Chairman Powell talk about these effects
[54:49.720 --> 54:53.240]  being looking to see whether they are persistent
[54:53.240 --> 54:58.240]  and material, that is, in fact, what the Fed will look at.
[54:58.920 --> 55:03.600]  This is, as I see it, really kind of a double whammy
[55:03.600 --> 55:06.480]  because, of course, we're coming out of a situation
[55:06.480 --> 55:10.800]  where trade has been affected by the tariff wars.
[55:10.800 --> 55:15.800]  And now we have this virus to contend with
[55:15.800 --> 55:18.160]  from an economic growth perspective.
[55:18.160 --> 55:22.360]  So I think this is actually a serious headwind.
[55:22.360 --> 55:24.440]  I think so, too, and I think it's going to be some time
[55:24.440 --> 55:26.640]  before we know we're so much more interconnected,
[55:26.640 --> 55:29.680]  it seems, now, than even we were during the SARS outbreak,
[55:29.680 --> 55:31.080]  both the United States and China,
[55:31.080 --> 55:33.120]  but really China with the rest of the world.
[55:33.120 --> 55:34.960]  And their economy has certainly swelled
[55:34.960 --> 55:36.880]  to be much larger than it was then.
[55:36.880 --> 55:37.800]  But the president, of course,
[55:37.800 --> 55:40.400]  Sarah also kept up his attacks against Jay Powell.
[55:40.400 --> 55:43.240]  He was tweeting during yesterday's testimony, quote,
[55:43.240 --> 55:46.040]  when Jerome Powell started his testimony today,
[55:46.040 --> 55:48.480]  that that was up 125 and heading higher.
[55:48.480 --> 55:50.520]  As he spoke, it drifted steadily downward,
[55:50.520 --> 55:52.840]  as usual, and is now negative 15.
[55:52.840 --> 55:55.320]  Germany and other countries get paid to borrow money.
[55:55.320 --> 55:58.240]  We are more prime, but Fed rate is too high.
[55:58.240 --> 56:01.080]  Dollar tough on exports.
[56:01.080 --> 56:03.520]  Oh, Sarah, I don't think he's ever going to escape
[56:03.520 --> 56:05.920]  these tweets, he's always going to be criticized,
[56:05.920 --> 56:09.000]  and Trump keeps pushing for this idea of negative rates.
[56:09.000 --> 56:10.760]  What do you make of it all put together?
[56:10.760 --> 56:14.440]  I guess both the president's criticism of Powell
[56:14.440 --> 56:16.840]  and the idea of negative interest rates.
[56:16.840 --> 56:19.000]  Right, and well, the question of negative interest rates
[56:19.000 --> 56:23.160]  actually got questioned in the context
[56:23.160 --> 56:24.520]  of the hearing yesterday.
[56:24.520 --> 56:28.560]  And I thought Chairman Powell was particularly articulate
[56:28.560 --> 56:31.640]  in taking negative interest rates off the table.
[56:31.640 --> 56:34.640]  I mean, he has made it clear that that is not going
[56:34.640 --> 56:36.680]  to be a tool in the toolbox,
[56:36.680 --> 56:39.040]  that the Fed is like more ammunition.
[56:39.040 --> 56:42.120]  He talked about the use of forward guidance,
[56:42.120 --> 56:44.800]  the use of large scale asset purchases,
[56:44.800 --> 56:47.440]  not that these are being contemplated at the moment,
[56:47.440 --> 56:51.640]  but you see the Fed here starting to talk about
[56:51.640 --> 56:55.240]  its usual playbook, should it need it,
[56:55.240 --> 56:57.680]  in terms of more accommodation.
[56:57.680 --> 57:00.920]  So I think the negative interest rate point
[57:00.920 --> 57:05.160]  was handled pretty clearly by Chairman Powell.
[57:05.160 --> 57:09.800]  That is not going to be a tool that he is contemplating
[57:09.800 --> 57:14.280]  right now, and I think the president can tweet on and on
[57:14.280 --> 57:15.560]  as much as he wants about it.
[57:15.560 --> 57:18.640]  It is a tool that has mixed results
[57:18.640 --> 57:20.720]  in terms of its use in other countries,
[57:20.720 --> 57:22.920]  and I think its use in the U.S.
[57:22.920 --> 57:26.240]  is something that is not considered imminent.
[57:26.240 --> 57:28.240]  Before we go here, Powell did also highlight
[57:28.240 --> 57:30.400]  what he sees as the biggest risk to U.S. growth,
[57:30.400 --> 57:32.120]  cybercrime, if you can just take a minute,
[57:32.120 --> 57:35.200]  we're going to play this for you.
[57:35.200 --> 57:39.680]  The thing that we worry about a lot is cyberattacks.
[57:39.680 --> 57:43.600]  I think we have a great game plan for traditional issues
[57:43.600 --> 57:45.400]  like bad loans and things like that.
[57:45.400 --> 57:50.920]  It's more cyberattacks is really the frontier where you worry.
[57:50.920 --> 57:51.960]  Sarah, what do you think about that?
[57:51.960 --> 57:53.360]  How big of an issue is that?
[57:53.360 --> 57:56.880]  It seems like so many businesses that we talk to at CNBC say,
[57:56.880 --> 57:59.040]  yeah, we're getting attacked basically every day.
[57:59.040 --> 58:02.080]  We've just gotten better at sort of thwarting many of them,
[58:02.080 --> 58:04.040]  but, you know, that's not, at some point,
[58:04.040 --> 58:05.640]  they're going to break through, I should say.
[58:05.640 --> 58:09.360]  That's right, and the volume and the complexity,
[58:09.360 --> 58:11.760]  the sophistication of these cyberattacks
[58:11.760 --> 58:13.360]  continues to increase.
[58:13.360 --> 58:17.000]  We saw this, I mean, I saw this back at my time at Treasury.
[58:17.000 --> 58:21.080]  I mean, this was something that is a mounting concern.
[58:21.080 --> 58:24.720]  I think that Chairman Powell is correct in noting
[58:24.720 --> 58:29.080]  that the defensive posture of a lot of financial institutions
[58:29.080 --> 58:31.840]  is actually increasing, and that's a good thing.
[58:31.840 --> 58:36.520]  So from a defensive posture, a lot of the institutions
[58:36.520 --> 58:40.400]  do have good mechanisms in place to thwart the attacks.
[58:40.400 --> 58:43.520]  But in terms of their coming, they're coming fast and furious
[58:43.520 --> 58:45.080]  and they continue.
[58:45.080 --> 58:47.280]  This is a serious headwind.
[58:47.280 --> 58:49.680]  I would, you know, I would have probably answered
[58:49.680 --> 58:51.880]  that question a little differently.
[58:51.880 --> 58:55.280]  I think that there are other big risks on the horizon,
[58:55.280 --> 58:58.760]  and maybe they will get explored today from the Senate side.
[58:58.760 --> 59:00.880]  But in particular, you saw Chairman Powell
[59:00.880 --> 59:03.320]  dodging around a little bit on some,
[59:03.320 --> 59:06.640]  on questions of climate change and financial stability
[59:06.640 --> 59:10.200]  and other, you know, and other kind of risk factors.
[59:10.200 --> 59:11.600]  So many things to consider.
[59:11.600 --> 59:13.280]  Sarah Blumraskin, thank you so much
[59:13.280 --> 59:14.880]  for being here with us this morning.
[59:14.880 --> 59:16.440]  We'll speak to you again very soon.
[59:16.440 --> 59:18.360]  That's it for World Wide Exchange this morning.
[59:18.360 --> 59:20.560]  Squawk Box begins right now.
[59:22.080 --> 59:22.920]  Good morning.
[59:22.920 --> 59:25.120]  The NASDAQ and S&P pushing the new highs,
[59:25.120 --> 59:28.080]  but companies are now warning of supply disruptions
[59:28.080 --> 59:31.360]  related to the coronavirus outbreak.
[59:31.360 --> 59:33.080]  Feeling the burn in New Hampshire,
[59:33.080 --> 59:36.080]  Senator Sanders edging out Pete Buttigieg.
[59:36.080 --> 59:37.840]  We're gonna take you live to the Granite State
[59:37.840 --> 59:40.840]  for the results and implications for investors.
[59:40.840 --> 59:43.800]  And shares of Bed Bath and Beyond are plummeting.
[59:43.800 --> 59:47.000]  The CEO is describing it as short-term pain.
[59:47.000 --> 59:49.240]  We've got details on all of it straight ahead.
[59:49.240 --> 59:52.080]  It's Wednesday, February 12th, 2020.
[59:52.080 --> 01:00:07.080]  Squawk Box begins right now.
[01:00:07.080 --> 01:00:08.240]  Good morning, everybody.
[01:00:08.240 --> 01:00:10.040]  Welcome to Squawk Box here on CNBC.
[01:00:10.040 --> 01:00:12.400]  We're live from the NASDAQ market site in Times Square.
[01:00:12.400 --> 01:00:14.200]  I'm Becky Quick, along with Joe Kernan
[01:00:14.200 --> 01:00:15.440]  and Andrew Ross Sorkin.
[01:00:15.440 --> 01:00:17.840]  Let's take a look at the U.S. equity futures at this hour.
[01:00:17.840 --> 01:00:20.600]  You'll see right now that the futures are indicated higher.
[01:00:20.600 --> 01:00:22.560]  In fact, the Dow indicated up by triple digits
[01:00:22.560 --> 01:00:24.680]  a gain of about 125.
[01:00:24.680 --> 01:00:27.680]  NASDAQ up by 51, and the S&P up by 13.
[01:00:27.680 --> 01:00:30.200]  And this comes after the S&P 500 and the NASDAQ
[01:00:30.200 --> 01:00:32.520]  both set new records once again yesterday.
[01:00:32.520 --> 01:00:33.520]  During the trading session,
[01:00:33.520 --> 01:00:35.120]  all three of the major averages were higher.
[01:00:35.120 --> 01:00:36.880]  The Dow gave back most of those gains.
[01:00:36.880 --> 01:00:51.080]  End of the day flat, but again...