Power Lunch - Dow tumbles 700 points in worst decline of 2025 so far 2/21/25

Episode Date: February 21, 2025

Stocks are selling off, as new economic data sparked concern among investors over a slowing economy and sticky inflation. We’ll cover all of the angles for you and your money. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

And welcome to Power Lunch alongside Kelly. You just saw moments ago. I am Brian Sullivan. Explosive allegations against massive insurance company United Health. The company accused of bilking taxpayers for billions. The story will blow your mind. And a new study has a plan to meet AI's energy needs without acting to grids why power couples could be the answer. And speaking of couples, why are baseball and ESPN apparently breaking up will tell you in what it may say about the future, Kelly, of sports streaming? Absolutely. Let's get you right to the markets, which are lower across the board and the losses have been accelerating over the past hour or so. The Dow's down 700 points. Call at half of that is UNH. Maybe a little less now. But it's not just a UNH story. As you can see, the Dow's down 1.6 percent, S&P 1.4, NASDAQ 1.7. You don't see the wrestles there, but they're down two and a half. And with all of, with today's declines, all three major averages will finish lower for the week. Nearly 2% lower for the NASDAQ. About that for the Dow, but still higher. on the year so far. Now, in today's market, we're seeing a reversal of some recent trends. Consumer discretionary, the worst sector led lower by the travel names, which had been hot. You see, Norwegian, down 6 percent, Airbnb, Expedia, those were up double digits in February. They're down 5 percent today. And consumer staples the only S&P sector higher today. A very defensive bent here. Many of these stocks have been lagging. Brian Hershey's today up 4%. All right, there's a lot to do today, but the big story of the day, maybe of the year, explosive charges against insurance giant

United Health Group. As Kelly just talked about, the stock slammed right now, which is helping drag the entire Dow down. Now, like anything related to insurance and Medicare, this is broad, it can be confusing. It is a complicated space. So let's try to boil down the story to the basics and the excellent reporting out of the Wall Street Journal. The journal reporting exclusively that the DOJ, the Justice Department, investigating United Health's billing practices. There is concern that UNH is extensively overbilling Medicare, and thus you, the taxpayer,

by adding diagnoses to patients that would trigger extra payments. Some doctors told the journal that they were effectively trained by United Health to document income-generating diagnosis that would be obscure or even irrelevant. otherwise. And the paper says debt could have amounted to billions in extra revenue for UNH. We've obviously reached

out to the United Health Group for a comment. We have not yet gotten any response. The company did weeks ago put out a statement to a separate story by the journal saying it is not aware of the DOJ's actions. Let's talk more about what we know and about the industry in general

with Dr. Robert Pearl. He is professor at Stanford University's School of Medicine and Graduate School of Business. also a former CEO of Kaiser Permanente, one of the nation's largest not-for-profit health plans, I believe the largest, serving more than 12 million members. Dr. Pearl, thanks for joining us. I don't want to go into the allegations specifically against United Health Group. It is a Wall Street Journal's story. It is not our story. But that said, what you know about how the industry works, would it be possible for an insurer to add on? Somebody goes in that gets changed.

checked out, and a doctor or a nurse or an administrator adds billing codes to their systems without a patient's knowledge? You have to differentiate what you're calling billing codes, which is, I see you in the office because you have a broken arm, and I fix the broken arm, and I bill for that, as opposed to the way that United Health Care is being paid by the federal government, which is what the allegations are about, which is specific to Medicare advantage. There they get paid a set fee. We call it a capitation to take care of a patient. And it's based upon how risky, how likely it is the patient is going to become sick. So if they're adding on diagnoses, but they haven't yet

manifested in a medical problem, that's okay. If they're adding on diagnosis that didn't exist or exaggerating the diagnoses that do exist, that is both improper and illegal. And we don't know, want to be very, very clear. This is a Wall Street Journal, multi-month investigative piece. It's on their website. People can go read it. UNH is clearly probably circling up the PR and the lawyers right now, and I'm sure we'll get more of a clear response by them. But this is also a company. It's under DOJ investigation for antitrust violations. And by the way, had one of their CEOs, their group CEOs murdered on the streets of Manhattan, just throwing that out there, largest health insurer in the United States. But would it even, doctor, be possible?

for someone to add. I go in, to your point, I've got a broken arm, and I go in, and they say, well, you're a little heavy, and they start adding some pre-diabetic codes without my knowledge, or some sort of diagnosis, without, and that's key, without my knowledge, and therefore gets paid by Medicare for something that I, as a patient, am not even aware of. You would not be aware of any of the codes that they are submitting to the CMS. that's just the coding for your diagnoses. They're not, it's not the documentation of the care delivered. It's a documentation of the diseases, the problems that you have.

So yes, you could theoretically have obesity, and as a consequence of that, have a set of measures that would indicate the hemoglobin A1C that you're pre-diabetic, and conceivably the doctor wouldn't tell you. I'd hope that the physician would tell you about that. but it's certainly conceivable that there are diagnoses that could be added that would be submitted for billing and added payment, and you as a patient would have no idea because you didn't come for that particular problem, and it wasn't relevant and very significant to why you were there that day. Dr. Pearl, the timing of this is all quite emblematic, right?

We have a Doge committee out there. We have this huge effort to cut the federal deficit. How much spend is potentially being wasted because of issues like this? there is a large amount of dollars in health care that I believe are being wasted. The real question, though, is how are they being most significantly impacted? And I think that the fraud piece of it is smaller. And the government, of course, makes adjustments all the time to, in essence, decode, reduce the coding payments that are being made.

I think, though, the biggest problem is the whole health care system is broken. It's a system designed to take care of you after you get sick. It's not designed to keep you healthy. What we know is that 60% of America have chronic diseases. And according to the CDC, 30% to 50% of heart attack, strokes, kidney failures, and cancers result from these. We do a poor job managing them. Imagine the cost reduction that would happen to reduce payments by the federal government if we had a healthier nation. Well, it's a separate issue, by the way, doctor.

but I'm 53 years old. I swear everybody I know has been sick lately, either strokes, cancer, illnesses, it's actually mind-blowing. I know I'm getting older, but that's a separate issue. I don't know what the hell is going on. It's not good. We need to fix the system. That aside, we have no idea where this is going.

This could be settled. This could be the DOJ, if this is in a happening, basically lets it go. But let me ask you this. It's your professional opinion. Should a company like United Health Group even have a Medicare business? Because when you get in bed with Medicare parts A or B or D, and I've been on the phone all day trying to understand it because Medicare itself was complicated,

should United Health have a Medicare business? As you're noting, Medicare has four different parts. The A is for the hospital, the B is the doctor's office, the D is for the drugs, and this is part C, which is the ability to provide kids. through a capitated system, and I believe it's a good way to go. The problem is that rather than paying the insurance company, this prepayment, which means that all they can do is require prior authorization and other interventional ways

to lower utilization, you should be paying it, as far as I'm concerned, at the clinician level, the doctors and the hospitals, because they're the ones who can change your health and keep you healthier. And I think if we were to move in that direction and United States, health care were required or didn't voluntarily to pay the money directly to the people providing the care, I think they would do the right things, investing in prevention, investing in better health, investing in better management of chronic disease, and avoiding many of these problems in the first place. But that's not the way the American health care

system functions today. I want to mention United Health's response to CNBC about this report. They said the Wall Street Journal continues to report misinformation on the Medicare Advantage program. And United Health saying any suggestion that our practices is fraudulent. is outrageous and false. I don't think anybody's claiming it's fraudulent, though. Are they? The article was... It seems like they're denying something that wasn't said.

Any suggestion that our practices are fraudulent is outrageous and false. So going back, Doctor, to what you said a moment ago, if Medicare advantage in the way that these payments are preauthorized leaves it open for, let's say, abuse, then what act of Congress or what gesture could change that going forward? Well, specific to the question you're raising, and the Medicare advantage has come under two sets of complaints that Congress is actually looking at it right now. The first one is the question of, are they getting paid too much by having higher diagnoses than reflect the actual disease status of its members?

And second is the prior authorization. And as you well remember at the time of the shooting of the CEO, this had headline stories related around it. I think it could do various things at the congressional level. first thing would be that it could do a better job of defining what needs to be done from a risk assessment and then monitoring and holding people to that. Were that done, were the rules clear, then if you break the rules that are created by Congress, that's called a crime, and it could be handled appropriately. But I think the more important part, the second part, is it can really force insurers to pay the money, not to pay the money, not to be handled appropriately.

into its own coffers, but directly to the providers of care, and then hold them accountable to make sure that the clinical outcomes, the diabetes, which affects 30% of Americans, today it's controlled appropriately less than half of the time. Hypertension, the number one cause of strokes, controlled only 60% of the time. Ensured that the insurers do what the program was set up to do, which is to maximize the health of its subscribers with the realization. that if you can keep people healthier, you will have lowered the cost of medical care. And that is what is good, not just for the patients, but provide providers of care and

follows nation's health as a whole. Yeah, unfortunately, I've gotten to kind of know the health care system a little better than I should, the last, between me and some family and whatever. And some of the stuff that I've found has been very disturbing and kind of goes, not to this story, but just in general, doctor. So, but I guess my better question is, how do we, first off, does it, is it just me or does everybody seem like they're sick, like really sick the last couple of years? That's a separate issue. You can answer that if you want. But also, how do, you gave a lot of things, how do we fix it?

I mean, do you think United Health is too big and should be broken up? In terms of why we are sicker, and we're definitely getting sicker. We're seeing the chronic diseases that are increasing in frequency and not improving in terms of appropriate management, and they're leading to more medical problems. It's why life expectancy in the United States has been stagnant since 2010. And you're also seeing right now, by the way, probably the worst flu season we've had in a long time. So everyone you know is probably coming down with the flu, with hospitalizations going up. So what you're seeing is a reality. It's cancer and strokes. I mean, I could tell you that almost everybody I know has cancer, had cancer,

know somebody has cancer or has had a stroke. It's unbelievable. Those are the consequences of chronic disease, and I want to add a piece to it, which is obesity. What we know is that 40% of cancers come from obesity. What we know is that diabetes comes from that, and that diabetes that leads to heart disease, heart attacks, kidney failure. So we're seeing this vicious cycle where Americans are becoming sicker because we're no longer just suffering for the kinds of problems appendicitis and gallbladder disease and pneumonia that happened in the last century. We're seeing an epidemic of chronic disease and it is not being effectively addressed. We have a model of care that's outdated. As though the stock market,

we're still using pieces of paper to purchase and sell stock the way it did 50 or 100 years ago. We're still using an outdated system. We need to bring in new technology. I'm very optimistic, by the way, that generative AI tools, tools that are going to be able to help patients be able to manage the chronic disease, help them avoid the problems. Could be a solution, but it's going to require congressional action and executive leadership to make it happen. I think a lot of people feel the system is very, very broken, and it's just so entrenched and difficult to figure out how to fix it. And, you know, even little stories like this one hopefully can start to point in the direction, maybe shed some light. Dr. Pearl, thanks for joining us today. We appreciate it.

Thanks for bringing this important issue forward. Of course. President Trump speaking from the Oval Office last hour, giving us some headlines, some insight into what he discussed with Tim Cook yesterday, the Apple CEO. Megan Costello, what can you tell us? Kelly, that's right. So we previously had not known what was the focus of that meeting in the Oval yesterday between President Trump and Apple CEO, Tim Cook.

But Trump hinting this afternoon speaking to some governors at the White House that Apple is now planning to invest what he says will be hundreds of billions of dollars in the U.S., and that they'll be doing it in order to avoid the tariffs. Take a listen. Yesterday I had Tim Cook in the office from Apple. He's investing hundreds of billions of dollars. I don't know. I hope he's announced it.

Hope I didn't announce this. But what the hell? All I do is tell the truth. That's what he told me. Now he has to do it, right? So it's good. But he's investing hundreds of billions of dollars and others, too. We're going to have a lot of chip makers coming in, a lot of auto.

makers coming in. So automakers and chip makers, you hear him say there will be investing in the U.S. as well. In addition to Apple, all of that he says will be to avoid the tariffs that he has announced that are yet to take effect. I will say, guys, a lot of wait and see here. We did not get any details beyond what you just heard there. So a lot to wait for in terms of how much is going to be invested, where those investments will go, whether any of this might have predated the tariff announcements.

That's something we have seen in the past. So a lot to look for there, but something to look forward to from Apple and other companies as we wait to see some reaction to these tariffs. And just one other thing to flag for you guys, in just over an hour from now, we do expect the president to sign some more executive orders and presidential memoranda as well. We are still trying to confirm what exactly those will be. But one thing that's out there, Bloomberg is reporting that one memoranda will open the door for the U.S. to allow levies or tariffs in response to digital services taxes.

So we know Trump has long been against digital services taxes that some countries in Europe and across the world use. And they really target tech giants. Trump tried to do something about this in his first term. Now Bloomberg is reporting that this memorandum, so again, one step down from an executive order, this would pave the way to potentially use tariffs to respond to those taxes. So more details to come potentially later this afternoon, guys, on that one. Thank you very much. Megan Kostela, we appreciate it.

A lot more to watch this hour. And right here yesterday, Carter Worth told us that energy has the highest. return potential of any sector this year. Coming up, we'll hear from a CEO in the LNG space. Jill Ivanko of Chart Industries joins us next. Welcome back to Power Lunch. The energy sector up more than a percent this week while markets are struggling and trying to make sense of all the energy headlines raging from reports of Japan and India, looking to up the amount of U.S. liquefied natural gas they import, to the U.S. and Russia discussing the end of the Ukraine war. Joining us now as chart industry's CEO, Jill Ivanko. They make equipment.

news in every aspect of the LNG supply chain. Jill, it's great to have you back. Welcome. How would you characterize the mood right now? Yeah, thanks for having me back. It's great to be here. So what I would say is in general, what we're hearing and seeing is just an increasing demand for global energy. And specific to LNG, this is, again, becoming a much more global market where the U.S. LNG exports have been increasing. We're hearing multiple different opportunities for doubling of importing in locations like India, as you refer to. Also, the Japanese looking to potentially import more LNG from the United States. But what I would say is, as a whole, with respect to energy, all things energy, whether it's artificial intelligence, data center

driven, there is a need for more. And the hybrid of solutions is something that's going to be extremely important to this. And LNG is at the heart and soul of that. Yeah. I would talk a little bit about kind of its role in what could be happening in Europe right now in particular, you know, as we talk about and just speculate for right now what could happen with if Russia and Ukraine come to some kind of truce or agreement. Where do you think Europe turns for its energy? I mean, would they ever turn back to those Russian supplies that they, Germany previously relied on? So certainly, you know, peace talks, there's uncertainty around what that can look like.

And so to your point about speculating, I think it's important that we look at the demand overall for global energy. And I believe that Europe is going to continue to need natural gas from multiple different sources, in particular when you look at the growing demand for European natural gas. If the Russian opportunity comes back online, that is going to take time, what that looks like, how much of that. All of that is uncertain. So what we believe is that there's going to continue to be a need to provide gas to Europe from various different geographies in the U.S. being at the center of that. We also think that there's the fact that you don't want to go back to as Europe, what we looked like before 2022, and have that risk that happened in February of 22

when the conflict broke out. Jill, I don't know a lot about energy. It's Brian Selvin, but I do know a lot about the stock market. I'm looking at your stock and I'm seeing it's down 17%. I'm thinking all we're talking about is how energy demand is going to grow. We've got pro energy in the White House, drill baby drill, all this other stuff. What are investors missing about chart industry stock? So overall at chart, we are molecule agnostic. So we serve a variety of different end markets with our process technologies, our engineering, as well as our equipment and manufacturing. And we do so globally. So that allows us to play in a variety of different end markets. and with the growing increase in demand for energy,

this is going to require a variety of different solutions in a variety of different geographies. What we have is flexible manufacturing capabilities to address those various different end markets and geographies, as well as learning from the supply chain challenges that hit the industry back in 2021 and early 2022, where we, like many other manufacturers, have reinforced our supply base,

having different regional supply sources, as well as global supply sources. So all of that plays to continue demand across the end markets and participation in these various different energy solutions to meet the growing demand. You're doing a carbon capture deal, Bloom Energy. Does carbon capture work? It's kind of like the, I don't say, Willie Wonka, what's the golden ticket? It's kind of like the thing that's the golden goose that's out there is potentially helping us solve some of our climate challenges, but yet other people say, well, it doesn't work. And if it did,

it's too expensive, what's the reality behind carbon capture? So the reality is that the technologies do work. And there's a variety of different technologies, whether that's amine or membrane or cryogenic carbon capture like chart has and presents to the market. What we have seen be very successful is carbon capture for reuse cases where CO2 is generated in the process and also used in the making of. of whatever it is that the operator is making. When you start to talk about economics, certainly on the reuse case, the economics works.

In other cases, the 45Q is important to having the economics work, but we believe that this is going to be a key part of what we see in the energy transition and also serving this growing need for demand, whether that's for data centers or for other end markets, which is something that carbon capture plays an important role in, but certainly looking for continued certainty around the 45Q will help

on the economic discussion. Jill Vanco chart industries, GTLS is the ticker. And I do love the Wisconsin connection, Jill, you know that. Bill, thank you very much. Thanks, Brian. All right, take care. All right, coming up, we're going to take another deep dive into the wild week for stocks, including some names that Kelly and I really think you need to hear about. It's not all bad. The The market's down big right now. A lot of concerns about travel and dining out and all kinds of stuff. But we'll do our stocks the week coming up. Welcome back to Power Lunch.

It's been a super busy week for stocks. Lots of different movers in the news. Want to draw your attention to Coinbase in particular today, which is now lower. It's down nearly 7%, down 8%, actually 12% on the week now. This is despite a big win as the SEC is dropping its case. Coinbase was accused of selling unregistered securities, and this is a broader win for crypto, the issue is whether Bitcoin and others should be classified as securities and subject to SEC rules or not. Now speculation is building they'll ultimately be classified

as commodities and fall under the smaller CFTC. Coinbase CEO Brian Armstrong on Squawk Box called it a huge day for Coinbase and said the company won't pay any fine as part of the settlement. On the flip side, the CEO of industry watchdog Better Markets, Dennis Kelleher, had this to say about the lawsuit. The SEC's unilateral surrender in its lawsuit against Coinbase is a historic mistake that endangers investors, markets, and financial stability. The SEC used to enforce the law without fear or favor, but is now favoring the crypto industry and fearing billionaire crypto kingpins

who are publicly belittling the agency, Brian. All right. So one stock to watch the week is Intel, really an epic bounce lately, up 30% this month, down 60% though, from its highs of about four years ago. So talk, Kelly, as you know, that Intel could be broken up.

38 analysts cover Intel. The average price target's $22. $0.42. Stock's at 2486 right now. It's down 5%. So it's about the average price targets, two bucks below where the stock is now. You don't see that a lot. So huge run. But if you go back in time, Intel has wiped out a lot of shareholders. So just a stock that I think everybody knows the name, but the trade has been very bizarre the last week or two. Yeah, it is reviving. Now have major questions about its future strategically. Coming up, how some power couples can help the U.S. win the global AI race. We will explain after a break.

Welcome back to Power Lunch. I'm Julia Borsden with your C&BC News Update. The man accused of ambushing and killing United Healthcare CEO Brian Thompson on a Manhattan sidewalk last December is in a New York court right now for a hearing in his state case. He arrived wearing shackles on his hands and feet. It is Luigi Mangione's first court appearance since his December arraignment on murder and terror charges. The judge is expected to set deadlines in the case today and potentially a trial date. A New York jury found the man accused of attacking author Salman Rushdie guilty this afternoon of attempted murder. They were in deliberations for a little less than two hours. Authorities say Hadimatar ran on stage as

Rushdie prepared for a speech in Western New York and stabbed him more than a dozen times, blinding him in one eye. Ireland's Sinn Féin political party says its leaders will not visit Washington, D.C., for next month's traditional St. Patrick's Day event out of protest. The party's leader called the Trump administration's position on Gaza, quote, catastrophically wrong in reference to his plan to remove about two million Palestinians from Gaza. Brian, back over to you. All right, Julie, thank you very much. All right, let's get back now to the markets and this big market drop. The Friday curse may be striking again. Michael Santoli joining us. Now, Mike, there's a lot going on. There's, you know, internet chatter, this, that, and the other thing. It's huge options,

Exbury Day. Do we have any idea what's sort of causing this end of the week sell-off? I think, Brian, it's a pile up of a lot of factors, as it usually is, but it's kind of accumulating to a mini growth scare. If you look at the way the market is trading, it's cyclical stocks down, it's travel stuff down. It's this idea that we started with pretty high expectations for the economy. The January retail sales, not that great. It was a bit of a consumer hangover, feeding into Walmart's subdued outlook. And then the University of the University of Michigan sentiment numbers today. Yeah, everyone focused on the inflation expectations blow out to the upside. I think the market correctly is just saying consumers are in a bad mood,

yields down hard. So we don't know how much of this is kind of chatter or headline driven, but it is a market that has been getting by and hovering near the highs with this very elegant rotation. If one thing's down, something else is offsetting it to the upside. Today, the UNH decline on its own news is disrupting that a little bit because everyone else in health care is kind of higher trying to do their part to support the defensive side of this market. So I think all that stuff is happening. We are still within this range. Right now, as we speak, the S&P 500 is just touching its 50-day average.

We were here earlier in February. But it shows you it's become a harder to please market. Mike, some headlines as well that were coming out of that investment conference, that Steve Cohen is more bearish on the economy this year. And I remember the past couple of years, while some of us thought that, a recession was imminent. He had said no. Dean Mackey, his economist said no. He was very bullish. And so that change in tone comes on a day when people are already sharing some of this concern about the retail sales, the consumer numbers, what's going on with inflation.

So I just note the Dow is now down more than 800 points. That's right. And what's really fascinating, Kelly, is that Cohen said that as much to us a few weeks ago, right? David Faber had him on and he was pretty cautious and he really did think, and this is what the market's dealing with. It feels as if whatever really conjure, into actual policy among all these proposals, it looks like it has more prospect to be growth negative in the short term before it's growth positive. We don't know if that's the way it's going to play out, but that's the kind of cumulative effect bundling together all these announcements. But it's funny that Cohen more or less had the same message a few weeks ago. Market wasn't ready to

hear it. And so today you have a little bit more sensitivity in that direction. The tenure going well below four and a half, that is sort of telling you that the market is just a little bit bracing for something. But Brian, you know, you mentioned the options expiration. That's very true. It doesn't mean it always creates selling pressure, but often the indexes will kind of notch down to the next area of cumulative exposures, next round number maybe. That could be what's happening. Everyone also knows from here on out February seasonally is a little bit tough. I don't know if it could be as neat and tidy as, you know what, that day is when the turn happens. But this is all the stuff on traders' minds. Well, it's a couple trillion dollars

of notional options activity. Golden Sachs point. pointed it out. Well, don't yet. I mean, is it... Well, that happens every month. We got you on TV for a reason, I assume we're going to talk about the options actually. No, no, you're right. But the thing is, it happens literally the third Friday of every month. And it's not as if the third Friday of every month was down 1.6%. If that's not it, what is it? Why are all the consumer stocks down? I was telling you, we have this buildup of concern that the consumer fatigue, we are hearing a little It existed yesterday and the day before and the day before.

That's right. It's a cumulative effect. And by the way, Walmart tried to bounce, didn't really bounce. And the high momentum stocks also very feeble bounces in the morning, things like Palantir and Robin Hood. And so I think the market just kind of takes that as a signal that, you know, buyer fatigue. And that's kind of where we are. Buyer fatigue. More sellers than buyers.

Mike, thanks very much. Mike Santoli. More selling pressure than buy. I think would be a fair headline. Selling dollars. buying fatigue? Yes. As we had to break, take a look at shares of FedEx down today in reaction to President Trump's plan to put the post office under control of the Commerce Department. FedEx still does business with the postal service for some deliveries. It's down nearly 6% today. UPS does not, and that stock is basically flat in a very tough tape. We'll be right back. All right, here's a little bit of good news in the energy space on what is a down day for the stock market. A new report says that data centers may not overtax our electricity system. if we are smart about how we power them.

Part of that has to do with what the Rocky Mountain Institute is calling, quote, power couples. Talk about this. And why you care was one of the co-authors of that report, Rocky Mountain Institute's Uday Veradarjan. Uday, thanks for coming on. It's a busy market day. I'm going to keep this very short. But if things are getting hit because there's a fear about power use, what are you and your colleagues found about how we're going to manage all this power use?

Well, I think the key is that we can start to use the existing grid better. Ironically, we have a lot of existing assets in the grid, a lot of gas generators, peakers that aren't used very much at the time. And those are perfect spots to build a fair bit of additional generating capacity, sites and data centers, and do that particularly with clean energy that you can actually buy and get installed in the next year or two, and manage to do that at a price that's still consistent with the average industrial commercial cost of electricity of around 10 cents a kilowattor hour across the country.

So we think this is an enormous opportunity. We see about 70% of the data center growth that we're seeing could be met by what we're calling these power couples using the existing grid and using these existing gas interconnection points to build out data centers and renewables in ways that don't affect the rest of the grid, don't force you to do upgrades, but still deliver the power that the data centers need. Uday, this is gaining traction just yesterday. The CEO of Empire State Realty, a commercial firm, told us he was concerned about what was going to happen with electricity, costs, and demand. There's more reports of people kind of being upset by their energy bills and seeing here in New Jersey, ours are going to rise in the summer, for instance, so this pressure is only mounting.

So give us some reassurance that this is a near-term thing that can help relieve pressure on the grid. Yeah, I mean, I think the thing that makes this so compelling is that this clean energy can be paid for by the data. Center providers and what they're exporting to the grid is largely very cheap excess clean energy that they don't need to use, which ultimately can help drive down both the emissions on the grid as well as the cost to the rest of the customers on the grid. You don't need to build a whole lot of new infrastructure that other customers will have to pay for with this approach, which is I think one of the reasons that people have been afraid of the data centers before.

If you had to build a whole lot of new wires and a whole lot of new generation, while everybody would have to pay for that. In this way, the data centers pay for what they need and export relatively inexpensive power to the rest of the grid. And, you know, don't take anything, any resources out of the existing grid. Yeah, I think it's an important. I'm going to post this report to social Uday because I think it's very important. It's new. And it's interesting.

Unfortunately, a big market day. We're going to cut it right there. But this is big. We'll post it out. Uday really appreciate that. Guys, throw those energy stocks back up there if we can. We saw it list like the whole market's getting it today. where we're seeing Constellation, some of these energy stocks, GEVernova,

GEVernova, anything related to power generation, Vistra, you could see, Constellation, ACHLO, which is nuclear down 10.5% right now. And you know what they have in common? These are the big power providers for the big AI buildout. So there is today a little bit of a sheen in the markets about kind of, hey, this is what Deirdre was talking about earlier. Can we still have this AI innovation and spend, but in a way that doesn't necessarily require all of these resources?

So maybe a positive for some of the users, players, long run, but again, the providers here are under some more pressure. You know what? Today reminds me of January 27th. January 20th. Deep Seek Day? Was Deep Seek Day when the headlines. But to be fair, Deer Jrabosa had the story on the Friday before the Monday. It was the weekend chatter that really caused it.

The weekend chatter caused this to happen. And to Kelly's point, anything related to energy and AI and data centers got kneecap, bring those charts back up. Let's just keep running the charts if we can, guys. Constellation, Vistra, and Aklo, they're all sort of, well, that's Akamai. They're all connected to sort of the data center built. Akamai's not, but the rest are GVronova as well. And these stocks are down 9, 10%.

One stock in the green to kind of keep an eye on in middle. This is Alibaba. And Alibaba is emerging as one of these AI players to watch. Again, the extent to which Alibaba deep seek any of these other, whether it's in China or here, showing that they can continue to innovate at the frontier without the massive Stargate investment, let's call it. You're seeing that's where the green is showing up on your screen today. Alibaba is up 4.5% and up 14% week to date. A lot of the other Chinese stocks as well have been perking up a little bit. We'll continue to track the market sell-off with all the major averages

down on the week. The Dow having its worst week in two months and it's down 778 right now. We'll be right back. Welcome back. The market's down big this afternoon and we're here to get to the heart of it. Talk about some of the biggest decliner's and a few that are in the green. Scott Nations is President of Nations indexes. And Scott, we wanted to start with the stock de jure, which is United Health Group. A lot of bad headlines surrounding this. The shares are off their lows. We should mention down 6.6%. What would you do here? This is a sell. Insurance companies are the companies that Americans love to hate. And while the murder of the CEO was just a tragedy, nothing else but a tragedy, today's news is a very different sort of problem.

It is alleged that they have gamed the Medicare reimbursement system in a really unsavory way of being pursued, it seems, by the Department of Justice. You might look at the forward PE of 15 and think that's attractive, but this is a relatively slow growth, low beta name. It now has a bunch of legal and PR problems, and this isn't its only legal problem. There are also some antitrust problems. A quick resolution of the news about Medicare might be impressive, but it doesn't mean that it's going to be smooth sailing. And investors just don't have to be along for this ride. So it's a sell. The company, again, is telling CNBC that the Wall Street Journal report is misinformation, saying any suggestion that our practices are fraudulent is outrageous and false.

Let's move along to Alibaba, which is one of the few that's in the green today. What do you make of this? I mean, it's, again, Jack Ma appears to be back in the good graces of President Sch. The company has some positive AI developments. What do you think? Yeah, this one's a buy. And you were just talking about it. It's done really, doing really well today, done well this week, up 68% year-to-date. The trader in me hates to say it's a buy, given what it's already done this year. But it is the best, or one of the best AI plays. It's taking more the deep seek angle. So while they're going to spend more money over the next three years on CAPEX than they have in the previous 10, it doesn't. It doesn't seem like it's going to be their AI ambitions are not going to be some giant hole in the ground that they're shoveling money into.

They have AI grafted onto a very strong existing business, forward PE of only 14 and a half. So there's a floor, you would think, a rock solid floor underneath this business and just a great way to speculate on AI. Yeah, I keep going back and thinking about those bullish bets on China a couple of months ago. And here we are. So let's talk Block. This is a very different one. I don't know if they just had the bad luck of a bad day, but this is down 17%. Now, tickers now, XYZ, weaker than expected revenue and profit. And what does this tell you? Yeah, they missed on both the top line and the bottom line. They missed on EPS by quite a bit, 71 cents versus 87 cents. And the Q1 guidance is not particularly good either. So this is a buy, but it's a buy at about $68 where it's at now with a stop at $60. Why is that? Well, cost. discipline for the company has been pretty good. But most importantly, they are rolling out their

afterpay program. They're going to attach it to their cash app card. After pay is their buy now, pay later program. And so the company is going to essentially change itself into essentially a lender. Better business to be in than the point of sale, point of purchase systems. Forward PE, very reasonable below 16. But trade with it. stop because if the company can't pull out of this nose dive, then you don't want to be alarmed for that right either. Yeah. So, you know, speaking, I don't want to say speaking of nose dive, Scott, but what do you make of the broader market right now? Yeah, we don't, traders hate uncertainty and there's way too much uncertainty right now. The stock market had done

very well, all-time high for the S&P earlier this week. This is to be expected, I think, actually. And if you can't handle this sort of a sell-off, then you shouldn't be an investor. The option market is relatively sanguine. So option prices are up, but they're not just, they're not to the moon. Panic, yeah, gotcha. So lots to worry about because of uncertainty, but the option market is not panicking. All right. Scott, thanks. We appreciate it today.

Scott Nations, Nations Indexes. All right, just to be clear, we did the top of the show, the United Health Group story. It's a Wall Street Journal story. It's their exclusive months-long reporting. We did the story at the top. I want to make sure the full statement from United Health Group is read, even though it's a Wall Street Journal story. Here's the statement. The Wall Street Journal continues to report misinformation on the Medicare Advantage MA program. The government regularly reviews all Medicare Advantage plans to ensure compliance, and we consistently perform at the industry's highest levels on those reviews. We are not aware of the launch of any new activity.

As reported by the journal, we are aware, however, that the journal has engaged in a year-long campaign to defend, I guess, a legacy system that rewards volume over keeping patients healthy and addressing their underlying conditions. Any suggestion that our practices are fraudulent is outrageous and false. It is the full statement from United Health Group. We'll be right back. All right, very quickly, wrapping it up. Chris Murphy from Susquehanna. It's nice enough to join us by phone. Chris, you're the options king.

What's going on with the stock market right now? Well, you know, we're not seeing any kind of broad panic. It's been a somewhat orderly sell-off. You know, you're seeing the expected increase in volatility that you'd expect for a move like this, but no liquidity issues. Certain sectors, maybe not as much the case, you know, anything retail-related,

XRT, consumer-related, home builders, a little bit more panic there. But broadly, it's much more of an orderly sell-off with a slight increase in volatility. I guess we'll leave it there. I would ask another question, Chris, but then the segment would be over and have to cut you off and then people would accuse me of interrupting.

So Chris Murphy, thank you. What a day. I get that a lot when I'm like, I literally have to go. Thanks for watching, Power Lund. This sell-off now is not just today. It extends the last couple of days. It's going to raise a lot more questions into the weekend.

We'll get answers on closing bell, which starts right now.