CHERYL: GOOD MORNING, I'M
CHERYL CASONE.
LAUREN: EARNINGS SEASON PRETTY
GOOD SO FAR.
IT CONTINUES WITH MORGAN STANLEY
AND NETFLIX DUE TODAY.
LET'S DIG INTO THE NUMBERS WITH
GARY SMITH, FOX NEWS CONTRIBUTOR
AND COME ANY
AND DOME ANY
AND DOMINANY
AND DOMINICY
AND DOMINIC DIVELLO.
DOMINIC, I WANT TO BEGIN WITH
YOU.
WE'VE SEEN A SMALL NUMBER OF
COMPANIES REPORT SO FAR BUT MORE
THAN 85% HAVE BEATEN
EXPECTATIONS.
SO THE QUESTION IS, DO YOU
EXPECT TO SEE EARNINGS RISE MORE
THAN THE EXPECTED 14%?
>> WELL, LOOK, WE CLEARLY HAD
PRICED IN A WORST CASE SCENARIO
IN THE FOURTH QUARTER, WORLD,
GLOBAL, SYNCHRONIZED RECESSION
AND UNDER THOSE CIRCUMSTANCES
EARNINGS WERE GOING TO BE
DISAPPOINTING.
WE'RE FINDING THE WORST CASE
SCENARIO HASN'T HAPPENED,
HOPEFULLY WILL NEVER HAPPEN.
I THINK WE'LL CONTINUE THIS
PROCESS OF BETTER THAN EXPECTED
EARNINGS AND HOPE FOR THE BEST.
LAUREN: THE OUTLOOKS, GARY,
HAVE BEEN PRETTY DECENT SO FAR,
AS FAR AS THE BANKS ARE
CONCERNED AT LEAST.
SO WERE ALL THOSE CONCERNS THAT
DOMINIC WAS TALKING ABOUT, DO
THEY JUST GO AWAY OR DO WE HAVE
NEW CONCERNS?
NOW WE FACE THE SHUTDOWN, THE
CONTINUED TRADE NEGOTIATIONS AND
BREXIT.
>> EXACTLY, LAUREN.
IT SEEMS LIKE WE HAVE A NEW
CONCERN ALMOST EVERY DAY.
YOU CAN THROW IN THE FED ALSO
INTO THAT, AS YOU MENTIONED THE
SHUTDOWN, WE HAVE THE TARIFFS,
ET CETERA, ET CETERA, ET CETERA.
IT'S ABOUT AS EASY FOR COMPANIES
TO LOOK INTO THE FUTURE AS IT IS
FOR YOU AND I.
I TEND TO THINK THAT LIKE, PER
DOMINIC'S COMMENTS, A LOT OF
THESE COMPANIES RODE SOME PRETTY
NICE TAIL WINDS IN THE FOURTH
QUARTER.
THERE WASN'T MUCH ON THE
HORIZON.
THEY TOOK EFFECT OF THE TAX
BREAKS.
A LOT OF THAT -- THE TAX EFFECT
IS GOING TO GO AWAY.
I PREDICT COMING YOU UP WITH ALL
THE THINGS THAT WE TALKED ABOUT,
ALL THOSE BARRIERS TO SEE
EARNINGS KIND OF LEVEL OFF.
I THINK THAT'S GOING TO BE
REFLECTED AS IT WAS IN APPLE'S
FORECAST GOING FORWARD, THAT
THINGS COULD GET A LITTLE ROCKY.
LAUREN: SO THEN DOMINIC, SHOULD
WE -- I KNOW THERE'S DIFFERENT
COMPANIES, DIFFERENT SECTORS.
SHOULD THE THEME FOR 2019 BE
MORE ONE LIKE APPLE OR ONE LIKE
BANK OF AMERICA, THE CEO SAYING
THE CONSUMER AND THE BUSINESS
ENVIRONMENT IS HEALTHY.
WHICH ONE IS IT?
>> LOOK, THE CONSUMER IS VERY
HEALTHY BUT I DO AGREE WITH GARY
ON THIS ONE.
THESE COMPANIES HAD TREMENDOUS
EARNINGS IN 2018, A BIG
COMPONENT OF THAT WAS THE TAX
CUT.
GOING FORWARD, LOOKING FORWARD,
THEY DON'T HAVE THOSE KIND OF
TAIL WINDS.
I THINK MORE REASONABLE EARNINGS
GROWTH OVERALL, I THINK THE
CONSUMER STAYS HEALTHY AND
HOPEFULLY NOTHING COMES ALONG TO
SHOCK THE ECONOMY.
LAUREN: THE FIRST SO-CALLED
FANG STOCK TO REPORT, GARY, IS
NETFLIX.
IT COMES AFTER THE CLOSING BELL
TODAY.
WE JUST HAD A GUEST ON AND HE
THINKS NETFLIX STILL HAS A HOT
HAND HERE AND CAN PUSH THROUGH
THE PRICE INCREASES AND
SUBSCRIBERS WILL SAY NO BIG
DEAL.
WHAT DO YOU THINK, GARY?
>> EXACTLY.
LOOK, IT'S KIND OF EVERYONE
NEEDS A LOT OF STOCKS TO JUST
LOOK IN THEIR OWN WALLET.
I'LL GIVE YOU A GOOD EXAMPLE.
I HAVE NOT DOWNLOADED A NEW APP
OR USED ANY OF APPLE'S SERVICES
OR BOUGHT A NEW iPHONE REALLY
IN MONTHS.
NETFLIX, I'M USING EVERY SINGLE
DAY.
I MEAN, THEY JUST INCREASED
PRICES.
I'LL BE HONEST WITH YOU, I DON'T
EVEN CARE.
I DON'T EVEN KNOW WHAT THE
PRICES ARE.
I THINK MOST PEOPLE OUT THERE
ARE IN MY CAMP.
THEY'RE LIKE WHATEVER IT IS, I'M
STILL USING IT.
I STILL LOVE IT.
THAT'S REAL PRICING POWER RIGHT
THERE.
LAUREN: NOW, DOMINIC, DISNEY
AND SOME OTHER -- TIME WARNER IS
TAKING THEIR CONTENT OFF OF
NETFLIX AS THEY START THEIR OWN
STREAMING SERVICES.
DOES THAT WORRY YOU?
>> IT WORRIES THEM.
CONTENT IS KING AND NOT HAVING
ACCESS TO THIS WILL HE POTENTIAL
ACCESS TO THIS WILL HE POTENTIAY
AFFECT THEIR REVENUE STREAM
GOING FORWARD.
THEY'RE DOING A PRETTY GOOD JOB
OF GETTING SUBSCRIBERS TO COME
ON-BOARD.
PEOPLE DON'T SEEM THAT SENSITIVE
TO THIS KIND OF PRICE INCREASE.
P P PAP
APP PAP
APPLPAP
APPLEAP
APPLE WAS VERY SENSITIVE TO THE
PRICE INCREASES ON THE PHONES.
LOOK HOW YOU SPEND YOUR MONEY.
LAUREN: DOMINIC AND GARY, I
LOVE THAT YOU'RE AGREEING THIS