Yahoo Finance LIVE market coverage: Thursday, August 29, 2019

Yahoo Finance LIVE market coverage: Thursday, August 29, 2019


>>>HAPPY THURSDAY. I AM BRIAN SOZZI AND THIS IS THE FIRST TRADE FOR AUGUST 29th. ALEXIS CHRISTOFOROUS HAS THE DAY OFF. CALLING FOR CALM, CHINA SIGNALS NO NEW RETALIATION IN THE TRADE WAR AND STOP FUTURES SPIKE IN THE STOCK MARKET. BUT, WILL PRESIDENT TRUMP GO ALONG WITH IT? WILL NEW TARIFFS TAKE EFFECT THIS WEEKEND?>>>RETAIL DISAPPOINTMENT. BEST BUY COMES UP SHORT ON CELLS IN THIS LATTICE QUARTER WHILE ABERCROMBIE AND FITCH WAS MIXED AT BEST. BUT THE CEO SAID, DON’T WORRY. I WILL HAVE DETAILS. >>>A BIG PLUS, NEW DETAILS ON HOW POPULAR DISNEY’S NEW STREAMING SERVICE COULD BE AND HOW MANY OF US ARE ALREADY RACING TO SIGN UP. LET GET A QUICK LOOK AT THE FUTURES RIGHT NOW.>>>DOW FUTURES ARE UP 257 POINT. THE SNP AND NASDAQ IN THE GREEN. PRETTY MUCH GREEN ALL MORNING LONG. THANKS TO THOSE COMMENTS ABOUT THE CHINA TRADE WARFRONT. FIRST, A BIG STORY.>>>CHINA IS EASING OFF THE RHETORIC AND WON’T RETALIATE WITH NEW TARIFFS AGAINST THE UNITED STATES. INSTEAD OF ISSUING NEW TARIFFS AGAINST THE U.S., BEIJING IS LOOKING FOR OTHER WAYS TO END THE TRADE WERE. CHINA’S MINISTRY US FOLKS MAN SAID THEY THINK THE QUESTION THAT SHOULD BE DISCUSSED NOW IS ABOUT REMOVING THE NEW TARIFFS TO PREVENT ESCALATION OF THE TRADE WERE. DOW FINANCE EDITOR IN CHIEF, CHEWYANDPETS.COM JOINS US NOW. >>WE HAVE NO IDEA WHETHER OR NOT THE TRADE WAR WILL BE SOLVED TOMORROW OR MAYBE 18 MONTHS FROM NOW, BRIAN. BUT THE INTERESTING DEVELOPMENTS YOU REFERRED TO ARE, HAS CHINA BLINKED OR ARE THEY PLAYING THE GROWN UP HERE? THE QUESTION IS, WILL PRESIDENT TRUMP RESTRAIN HIMSELF AND NOT GLOAT ABOUT WHAT IS HAPPENING? I WOULDN’T COUNT ON THAT.>>ARE THERE ANY SIGNS THE MEETING WILL TAKE PLACE IN SEPTEMBER?>> YES, IT LOOKS LIKE THAT COULD HAPPEN. NO ONE REALLY KNOWS. AGAIN, I HATE TO KEEP SAYING THAT, BUT IT REALLY IS THE CASE. WITH THE SIGNALS WE ARE GETTING TODAY, MEETINGS MIGHT BE MORE LIKELY. BUT, YOU HAVE TWO THINGS GOING ON HERE. ON THE ONE HAND YOU HAVE THE CHINESE SYSTEM, WHICH IS OPAQUE AND ON THE OTHER HAND, YOU HAVE PRESIDENT TRUMP WHO IS UNPREDICTABLE. IF YOU PUT THOSE TWO THINGS TOGETHER AND YOU ASKED ME WHERE QUESTIONS ABOUT WHERE THINGS ARE GOING, I REALLY DON’T KNOW. >>DO YOU THINK THIS IS CHINA’S WAY OF SAYING WE HAVE TO GET SOMETHING DONE, OUR ECONOMY IS STARTING TO SLOW. MORE OF A SLOWDOWN THAN WE EXPECTED.>>THOSE ARE THE SIGNS. THAT THE CHINESE ECONOMY IS WEAKENING. HOW MUCH OF THAT HAS TO DO WITH THE NORMAL CYCLE AND HOW MUCH OF IT HAS TO DO WITH THE GLOBAL SLOWDOWN, AND HOW MUCH HAS TO DO WITH THE TRADE WERE. IT IS DIFFICULT TO PART THAT THING. IT IS UNDENIABLY TRUE THAT THE TARIFFS ARE HAVING AN IMPACT ON THE CHINESE ECONOMY. THE CHINESE DO HAVE MORE TOOLS AT THEIR DISPOSAL. THEY CAN DO THINGS THAT THE U.S. PRESIDENT CANNOT DO. SO, THE CHINA SITUATION IS DEFINITELY SOMETHING THAT THE CHINESE CAN MANAGE THEMSELVES. IT JUST BEARS WATCHING. >>NOW, IN MANY RESPECTS THE BALL IS IN THE HANDS OF PRESIDENT TRUMP. HE HAS TO ACKNOWLEDGE THAT THERE IS DOWNSIDE RISK, REAL DOWNSIDE RISK TO THE U.S. ECONOMY. >>AND OF COURSE, THAT IS THE WHOLE THING FOR HIM AS HE LOOKS TOWARDS THE 2020 ELECTION. NUMBER 1, HE HAS TO MAKE SURE HIS BASE IS SOLIDIFIED. AND, BASHING CHINA SEEMS TO BE A STRATEGY HE THINKS WORKS WITH THAT. AND NUMBER 2, THE BIGGER THING IS TO ACTUALLY GET THE ELECTORATE TO VOTE FOR HIM. THE ECONOMY SEEMS TO BE IN GOOD SHAPE. NO DOUBT, THE TARIFFS ARE IMPACTING WHAT IS GOING ON IN CHINA AND NO DOUBT THAT IS IMPACTING GLOBAL TRADE. THE PRESIDENT IS CLEARLY MAKING THIS TRADE-OFF, SAYING I CAN DO THIS TO ACCOMPLISH WHAT I WANT WITH CHINA AND KEEP U.S. ECONOMY IN GOOD ENOUGH SHAPE TO HAVE A WIN WIN SITUATION. TO HAVE MY CAKE AND EAT IT TOO.>>>AND NOW THERE IS A SPEECH COMING APPARENTLY IN OCTOBER. >>THIS WILL BE THE 70th ANNIVERSARY OF CHINA IN TIANANMEN SQUARE. A REALLY BIG DEAL FOR THE CHINESE. IT IS GOING TO BE A BIG MILITARY PARADE, THE BIGGEST THEY HAVE EVER HAD, THEY SAY INCLUDING STRATEGIC NUCLEAR MISSILES. THAT IS ACCORDING TO A NEWS STORY OUT. >>THANK YOU SO MUCH.>>> ANOTHER BIG MORNING FOR SOME WELL-KNOWN NAMES IN RETAIL. BEST BUY, ABERCROMBIE AND FITCH, AND WILLIAMS SONOMA OUT WITH THEIR EARNINGS THIS MORNING. SCOTT HAS BEEN CRUNCHING THESE NUMBERS ALL MORNING LONG.LET’S START WITH BEST BUY, HOW DO THEY LOOK? >>EARNINGS CAME IN ABOVE EXPECTATIONS. EARNINGS OF $1.08 TOPPING EXPECTATIONS OF $0.99. REVENUE OF JUST OVER 9 1/2 BILLION DOLLARS CAME IN SLOWLY BEFORE AND BELOW ESTIMATES. WHAT STRUCK ME WAS THE GUIDANCE, THEY ACTUALLY RAISED THE EARNINGS RANGE FOR THE FULL YEAR 2019, BUT THEY NARROWED THE REVENUE RANGE FOR 2019. THAT COMES EVEN WITH THEIR BEST ESTIMATES FOR THE TARIFF IMPACT THAT WE ARE EXPECTING THIS YEAR. AND, THAT INCLUDES THIS LATEST POSSIBLE ESCALATION OF THOSE TARIFFS TO 30% ON VARIOUS GOODS FROM CHINA. SOME OF THE OTHER METRICS IN THE QUARTER, e-COMMERCE CELLS, ANOTHER METRIC WE ARE FOLLOWING MORE AND MORE WITH THESE RETAILERS. THAT WAS UP ABOUT 17%. YEAR OVER YEAR, AND THE STOCK IS DOWN IN PREMARKET TRADING, BUT HEADING INTO THIS QUARTER IT WAS UP ABOUT 30% SO FAR THIS YEAR. >>SCOTT, WHAT HAPPENED TO ABERCROMBIE AND FITCH? THEY INITIALLY BEAT EARNINGS, BUT NOW STOCK IS GETTING SLAMMED. >>IT IS DOWN DOUBLE DIGITS IN PREMARKET TRADING. WE ARE LOOKING AT A LOSS OF $.40 A SHARE. THAT WAS NARROWER THAN THE LOSS THAT WALL STREET WAS EXPECTING. SAME-STORE SALES WERE FLAT. WALL STREET WAS ACTUALLY EXPECTING AN INCREASE OF 1.2%. THE COMPANY DID SAY THEY HAD A SOLID START TO THE BACK-TO- SCHOOL SEASON. WE SHOULD ALSO MENTION HOW SALES OF ABOUT $141 MILLION DID COME IN BELOW EXPECTATIONS. THIS IS A STOCK, BY THE WAY THAT IN ADDITION TO THE DECLINE WE ARE SEEING WHICH WAS DOWN SO FAR THIS YEAR.>>I TALKED TO ABERCROMBIE AND FITCH CEO JUST MOMENTS AGO. U.S. BUSINESS IS PRETTY SOLID. THE INTERNATIONAL BUSINESS CONTINUES TO STRUGGLE FOR THEM. WE WILL TALK ABOUT THAT MORE LATER. AND LAST MAMA BUT NOT LEAST WILLIAM SONOMA. >>WE ARE LOOKING AT $.87 A SHARE, SLIGHTLY AHEAD OF EXPECTATIONS. THE SAME THING WITH REVENUE, THAT BEAT AS WELL. COMPARABLE SALES FOR THE GROUP WAS ACTUALLY UP 6 1/2% YEAR OVER YEAR. BUT, WILLIAMS SONOMA ITSELF ACTUALLY HAD A SLIGHT DECLINE IN YEAR-OVER-YEAR,. THAT ALSO INCLUDES BRANDS LIKE WEST ELM, THAT HAD A 17% INCREASE IN COMPS. POTTERY BARN WAS ANOTHER BRIGHT SPOT FOR WILLIAMS SONOMA IN THE QUARTER. >>THEY CLEARLY NEED YOUR HELP. WE WILL TALK TO YOU SOON. >>>LET’S HEAD DOWN TO THE NEW YORK STOCK EXCHANGE AND TALK WITH INES FORAY. DEFINITELY, DISCOUNTERS ARE TOP OF MIND. >>THAT IS RIGHT. AND I HAVE EARNINGS REPORTS FROM DOLLAR GENERAL. I WILL GET TO THAT IN JUST A SECOND. I WANT TO MENTION, THE SECOND READING OF THE SECOND QUARTER OF GDP, THAT CAME IN AT 2%. THAT WAS IN LINE WITH WHAT WAS EXPECTED. IT IS A SLIGHT DOWNWARD REVISION OF 2.1%. STILL 2%, IS THE SECOND READING OF THAT GDP NUMBER OF THE SECOND QUARTER. AS YOU JUST MENTIONED, DOLLAR GENERAL IS SEEING A POP THIS MORNING IN PREMARKET. THIS IS AFTER THEIR ADJUSTED EARNINGS AND REVENUE CAME ABOVE EXPECTATIONS. THEY ALSO BOOSTED THEIR FULL- YEAR GUIDANCE. ALSO, THIS MORNING WE ARE WATCHING ALL THESE BARGAIN OUTLET. THAT IS TANKING THIS MORNING. THIS IS AFTER THEIR ADJUSTED EARNINGS AND NET SELF CAME IN BELOW WHAT THE STREET WAS EXPECTING. THE COMPANY POINTED SOME CHALLENGES LIKE THE RAPID PACE OF STORE OPENINGS AND ALSO SUPPLY-CHAIN PRESSURES. AND THEN, THIS MORNING WE ARE WATCHING BURLINGTON STORES, SEEING STRONG QUARTER. THIS IS AFTER THEY POSTED BETTER THAN EXPECTED EARNINGS FOR THE QUARTER. EARNINGS FOR THE SECOND QUARTER CAME IN ABOVE WHAT THE STREET WAS EXPECTING. SALES CAME IN ABOVE WHAT WAS EXPECTED AND THEY RAISED THEIR FULL-YEAR GUIDANCE. RIGHT NOW, IN PREMARKET WE ARE SEEING THAT THE DOW IS UP MORE THAN 200 POINT RIGHT NOW. IF YOU ARE SEEING SOME PEOPLE BEHIND ME, THEY ARE MILITARY.>> I WAS GOING TO ASK YOU ABOUT THAT.THAT IS QUITE A CROWD.>> MILITARY VETERANS FROM 13 LATIN AMERICAN COUNTRIES ARE HERE THIS MORNING FOR A SPECIAL EVENT. >>CERTAINLY GOOD TO SEE. THANK YOU SO MUCH.>>>OVERSEAS MARKET GENERALLY LIKE THE POSITIVE NEWS OUT THIS MORNING ON THE TRADE WARFRONT. THE CAC 40 AND OTHERS ARE PRETTY MUCH IN THE GREEN AS WELL. TOM BELCHER JOINS US FROM LONDON NOW. TOM, ALL THINGS LARGE JOHNSON THIS WEEK. >>INDEED. A PEDI DICTATOR, A MAN USING REAL FAMILY UNDEMOCRATIC TACTICS THAT IF USED BY THE OPPOSITION WOULD SET A DANGEROUS PRECEDENT. THOSE ARE NOT MY WORDS. THOSE AREN’T EVEN THE WORDS OF THE POSITION IN BRITAIN, BUT THAT IS HOW LEADING MEMBERS OF BORIS JOHNSTONS OWN PARTY ARE DESCRIBING HIS DECISION YESTERDAY, TO RAM BRITAIN TOWARDS A CLIFF EDGE, NO DEAL BREXIT BY SUSPENDING PARLIAMENT. THE PAST 24 HOURS ALONE, WE HAVE SEEN MORE THAN 1 MILLION BRITS SIGNING A PETITION AGAINST IT. WE HAVE SEEN TWO SENIOR TORY POLITICIANS QUIT. AND, WE HAVE EVEN SEEN HALF OF BRITAIN SURVEYED SAYING THEY THINK THIS DECISION IS COMPLETELY UNACCEPTABLE. THIS CERTAINLY FEELS LIKE THE BIGGEST POLITICAL CRISIS IN MY LIFETIME, AND IT IS HARD TO OVERSTATE JUST HOW DIVIDED BRITAIN ALREADY IS. THIS LOOKS LIKE TO INFLAME THOSE TENSIONS STILL FURTHER. >>TOM, I WAS WONDERING IF THOSE WERE IN FACT YOUR WORDS. THANKS FOR PUTTING THAT INTO CONTEXT. DEUTSCHE BANK IS NOW PUTTING THE ODDS OF BRITAIN CRASHING OUT WITHOUT A DEAL AT 50-50. ANYTHING THAT CAN BE DONE TO STOP THIS? >>YES, THAT IS RIGHT. MOST ANALYSTS, UNTIL RECENTLY HAD SAID BASICALLY HAVE BEEN BETTING ON THE DEAL. THIS IS WHAT MAKES THIS A PARTICULARLY STRIKING A SETTLEMENT FROM DEUTSCHE BANK. IT JUST SHOWS HOW FAR THE GOVERNMENT HAS LEANED TOWARDS A NO DEAL BREXIT, AND HOW LIMITED TIME IS FOR LAWMAKERS TO DO NYTHING TO STOP IT. >>SOME MPS TALKING ABOUT PASSING A LOT TO STOP OR DELAY BREXIT. BUT, TIME IS RUNNING OUT AND THAT COULD TAKE WEEKS WHEN THEY JUST HAVE DAYS. IT IS VERY HARD TO SEE NOW, WHAT MORE MPS COULD DO. YOU NEVER KNOW. THERE IS STILL AT LEAST ONE MORE WEEK TO POSSIBLY STOP THIS IN ITS TRACKS. >>GOOD TO SEE YOU. >>>NOW, TO TODAY’S NEWS BITES. HURRICANE DORIAN NOW HAS ITS EYES ON THE BAHAMAS AND FLORIDA AFTER SITES WIPING PUERTO RICO AND DOUSING THE VIRGIN ISLANDS. THE LATEST FORECAST TRACK HAS THE HURRICANE SLAMMING INTO FLORIDA AS EARLY AS NEXT WEEK. AND MIAMI RESIDENTS ARE ALREADY GETTING READY. ONE COSCO SAID THERE IS A LIMIT ON BUTTERED WATTLE.>>>THE EPA IS CUTTING BACK ON A RULE TO PROTECT THE ENVIRONMENT. IT WILL SHARPLY CURTAIL ITS REGULATION OF METHANE GAS EMISSIONS, INCLUDING OF GETTING RID OF OVERSIGHT METHANE GAS LEAKS. IT IS SEEN AS A BOON FOR THE ENERGY INDUSTRY AND THE KEY LOBBYING GROUP.>>>FBI AGENTS SEARCHED THE MICHIGAN HOME OF UNITED AUTO WORKERS PRESIDENT, GARY JONES IN CONNECTION WITH THE MULTIYEAR INVESTIGATION INTO CORRUPTION AT THE HIGHEST LEVELS OF THE ORGANIZATION. INVESTIGATORS ALSO SEARCHED THE CALIFORNIA HOME OF THE UAW’S FORMER PRESIDENT, DENNIS WILLIAMS. FEDERAL PROSECUTORS ARE LOOKING AT ALLEGATIONS OF KICKBACKS, BRIBES, AND OTHER FINANCIAL WRONGDOINGS. NINE PEOPLE HAVE ALREADY BEEN CHARGED AS PART OF THIS PRO- .>>>ANOTHER CANNON HAS DROPPED OUT OF THE 2020 PRESIDENTIAL RACE, SENATOR KIRSTEN GILLIBRAND ANNOUNCED HER WITHDRAWAL FROM THE RACE AFTER FAILING TO QUALIFY FOR A 30 DAY. HER CAMPAIGN WAS CENTERED AROUND ISSUES OF WOMEN’S EQUALITY. SHE SAID IN AN INTERVIEW, SHE WILL ENDORSE ANOTHER CANDIDATE, BUT SHE IS NOT SURE WHO. >>>START TANK START KEVIN O’LEARY CONFIRMED HE WAS INVOLVED IN A BOATING ACCIDENT OVER THE WEEKEND THAT KILLED TWO PEOPLE. HE WAS A PASSENGER ON A BOAT COLLIDED WITH ANOTHER ON SATURDAY NIGHT. HIS WIFE WAS DRIVING THE BOAT AT THE TIME OF THE CRASH. CANADIAN POLICE IN TORONTO SAY NO CHARGES HAVE BEEN FILED YET.>>>WILD BABY ELEPHANTS ARE BEING SAVED. THE EU VOTED FOR A BAN AND NO LONGER ALLOWS AFRICAN BABY ELEPHANTS TO BE SNATCHED UP AND SENT TO APPROPRIATE AND ACCEPTABLE DESTINATIONS. ZIMBABWE HAD BEEN CAPTURING ELEPHANTS AND SENDING THEM TO ZOOS IN CHINA AND OTHER COUNTRIES. NOW, THE TRADE IN WILD ELEPHANTS WILL BE HEAVILY REGULATED AND ONLY ALLOWED IN EXCEPTIONAL CIRCUMSTANCES. >>>COMING UP HERE ON THE FIRST TRADE, IT IS A GRIDIRON BATTLE LIKE NO OTHER. THE NFL REPORTEDLY NAMES A HARD SELTZER SPONSOR. WE WILL TELL YOU WHO CAME OUT ON TOP>>>ALSO, IT MAY BE A SMALL WORLD BUT WILL HAVE A LARGE AUDIENCE. NEW NUMBERS THAT SHOW HOW SUCCESSFUL DISNEY PLUS COULD, IN FACT BE.>>>TAKING ONE MORE LOOK AT THE FUTURES, NICELY IN THE GREEN ALL MORNING LONG. DOW FUTURES ARE UP 238 POINTS, S&P AND NASDAQ ARE ALSO NICELY IN THE GREEN. WE WILL BE RIGHT BACK. >>>WELCOME BACK TO THE FIRST TRADE. HERE IS A QUICK LOOK AT THE FUTURES. IN THE GREEN ALL MORNING LONG, NO QUESTION ABOUT THAT. THE DOW IS UP 236 POINTS, THE SNP AND NASDAQ ARE LOOKING PRETTY GOOD.>>>APPLE COFOUNDER, STEVE WOZNIAK WANTS APPLE TO BE BROKEN UP, BUT NOT THE WAY SOME LAWMAKERS MAY WANT. HE WOULD LIKE APPLE TO SPIN OFF INDEPENDENT DIVISIONS. WOZNIAK FEELS THIS WOULD ALLOW ENGINEERS TO MORE CREATIVELY WORK ON THEIR OWN AFTER OVERSIGHT FROM TOP BRASS AT THE COMPANY. IN AN INTERVIEW, HE SAID “I THINK TECH HAS GOTTEN TOO BIG AND IT IS TO POWERFUL OF AFORESAID HAS TAKEN OUR CHOICES AWAY. CLOTHES”. THAT IS QUITE THE QUOTE.>>YES, HE SPEAKS HIS MIND. HE IS ENTITLED TO DO THAT. HE IS THE COFOUNDER OF APPLE. HE IS NOT THE ONLY PERSON TO TALK ABOUT BREAKING UP APPLE. I WILL SAY IN THOSE COMMENTS WITH AN INTERVIEW WITH BLOOMBERG, HE WAS TALKING ABOUT HOW THE MODEL FOR HIM WOULD BE HEWLETT-PACKARD, WHERE ENGINEERS ARE ALLOWED TO DO AS THEY WANTED. I WILL POINT OUT TO HIM, WHO I KNOW A LITTLE BIT. I HUNG OUT WITH HIM BACK IN FLORIDASTATE IN 2014. THERE ARE THE TWO OF US. BUT, HEWLETT-PACKARD OVER THE PAST DECADE OR SO IS A MUCH LESS SUCCESSFUL COMPANY THAN APPLE HAS BEEN. AND APPLE HAS STAYED TOGETHER AND HEWLETT-PACKARD HAS BEEN BROKEN UP. THAT POINT OF CLEAR CLARIFICATION. THERE IS AN INCREASING DRUMBEAT ABOUT MANY PEOPLE ABOUT BREAKING UP THESE BIG TECH COMPANIES. RECENTLY, I SPOKE TO JOHN FOR SWEAT WHO IS THE CEO AND FOUNDER OF A PROMINENT VENTURE COMPANY IN NEW YORK CALLED BETA WORKS, AND ASKED HIM ABOUT BREAKING UP BIG TECH. HE REFERRED TO AN ARTICLE WRITTEN BY CHRIS HUGHES, WHO IS ONE OF THE COFOUNDERS OF FACEBOOK. HERE IS WHAT HE HAD TO SAY.>>I THINK CHRIS HUGHES HAD OPPOSED THAT WAS VERY ARTICULATE. I THINK CHRIS IS A THOUGHTFUL GUY AND IS VERY CLEAR THAT THIS WAS JUST HIM. H THOUGHT ABOUT THIS FOR A LONG TIME. I THINK HIS ARGUMENT IS COMPELLING, BUT I DON’T THINK IT IS SUFFICIENT. I THINK THEY ARE JUST TAKING FACEBOOK AND INSTAGRAM AND WHAT IS HAPPENING AND BREAKING THEM UP. THAT IS INSUFFICIENT. YOU STILL HAVE THIS INCREDIBLE BASE OF DATA, IF YOU TAKE YOUTUBE OUT OF GOOGLE, YOU STILL HAVE THIS INCREDIBLE BASE OF DATA WITHIN THESE COMPANIES. AND, YOU WILL STILL HAVE MANY OF THE SAME PROBLEMS. >>I THINK WHAT HE IS SAYING THERE IS THAT BRIAN, NOT ONLY TO THESE COMPANIES BE BROKEN UP, SAY FACEBOOK INTO VARIOUS PLATFORMS. BUT, DATED TRANSPARENCY AND PORTABILITY BY CONSUMERS IS VERY IMPORTANT. WE WILL SEE A WAVE OF REGULATION, MAKE NO MISTAKE ABOUT IT. IT WILL HAPPEN AT SOME POINT. WE CAN’T HAVE COMPANIES THAT ARE THIS BIG AND UNREGULATED. THINK ABOUT FACEBOOK AND HOW BIG IT IS AND HOW POWERFUL IT IS, AND HOW LITTLE REGULATION IT HAS RELATIVE TO SAY A COMPANY LIKE WALMART. >>CAN YOU TALK TO A LOT OF THIS BIG TECH EXECUTIVES. ARE THEY AS WORRIED AS MANY PEOPLE ON WALL STREET MIGHT BE?>>I DON’T THINK THEY ARE. AND BY THE WAY, THE PEOPLE ON WALL STREET MAY OR MAY NOT BE WORRIED. OF COURSE, BREAKING THIS COMPANY UP AND WE TALKED ABOUT TWO EXAMPLES.WE TALKED ABOUT HEWLETT-PACKARD THAT DIDN’T GO TOO WELL. AT&T ON THE OTHER HAND, WORKED OUT VERY WELL FOR INVESTORS OVER THE LONG RUN. BREAKING UP NOT BE A BAD THING FOR WALL STREET, CERTAINLY THE BANKERS WOULD LIKE THOSE FEES. >>THEY LOVE THOSE FEES. ANDY SERWER , THANK YOU VERY MUCH. >>>>>THE NFL IS REPORTEDLY NAMING A NEW SPITE SELTZER SPONSOR. EMILY McCORMICK IS IN THE NEWSROOM MORE. EMILY?>>ANOTHER SPITE SELTZER BRAND WILL BE THE OFFICIAL SPITE SPICER BRAND OF THE NFL. THIS WILL BE AVAILABLE IN NFL STADIUMS STARTING IN THE FALL.THE SPONSORSHIP IS GOING TO INCLUDE NEW TELEVISION ADVERTISING PURCHASES. THIS IS JUST AN EXPANSION OF THAT RELATIONSHIP BETWEEN AB AND BEV IN THE NFL WE HAVE SEEN PREVIOUSLY. THE COMPANY’S BUD LIGHT RAN IS ALREADY THE LEAGUE’S OFFICIAL BEER SPONSOR AND AB SPENDS MILLIONS OF DOLLARS ANNUALLY IN ADS DURING THE SUPER BOWL. A LITTLE BIT OF AN EXPANSION ON THAT NEWS. REMEMBER THAT SPITE SELTZER’S IS A RAPIDLY GROWING SPACE IN THE BEVERAGE INDUSTRY, ACCORDING TO A BANK OF AMERICA- MERRILL LYNCH SURVEY. HARD SELTZER’S ACCOUNTED FOR 5% OF U.S. BEAR MARKETS. THAT GREW 164% YEAR-OVER-YEAR IN JULY. A LOT OF UPSIDE FOR THIS NEW MARKETSHARE. >>THIS STUFF IS COMPLETELY TAKING OVER. YOU TALK TO SOMEBODY ABOUT BILLION-DOLLAR BRANDS NOT EXISTING IN THE BEVERAGE SPACE EVENTUALLY. WHAT CAN YOU TELL US ABOUT THAT? >>I SPOKE WITH THE CEO AND FINDER OF IRIS NOVAK, THE PARENT COMPANY. T IS CALLED DIRTY LEMON AND HAS SOLD SO MUCH SINCE ITS INCEPTION. THAT IS WHAT ZACH NORMANDY. HE WAS TELLING ME THAT HIS COMPANY WANTS TO COMPETE WITH COCA-COLA, WHICH IS INTERESTING, BECAUSE HIS COMPANY IS BACKED BY COCA-COLA. IRIS NOVAK IS A PARENT COMPANY AND HAS A SMALLER BRAND AS AN EXPANDING THE BRAND PORTFOLIO. HERE IS WHAT HE HAD TO SAY ABOUT THE FUTURE OF THE FOOD AND BEVERAGE SPACE. >>ON THE DIRTY LEMON LINE WITH THE BASE OF LEMON JUICE, OCEAN MINERALS AND SEA SALT. AND WE ADD FLAVOR AND FUNCTION ON TOP OF THAT. THAT HAS BEEN A REALLY GREAT WEIGHT FOR US TO SCALE. WE COULD LAUNCH HUNDREDS OF DIFFERENT BEVERAGES UNDERNEATH THE DIRTY LEMON LINE AND NOT BE TIED TO ONE SPECIFIC INGREDIENT. THAT IS THE CHALLENGE I HAVE SEEN WITH A LOT OF OTHER BRANDS. THEY FOCUS ON ONE INGREDIENT, AND CONSUMERS ARE SO TRANSIENT IN THEIR PURCHASING DECISIONS THAT IT BECOMES REALLY HARD TO REST YOUR LAURELS ON ONE SPECIFIC INGREDIENT AND BUILD A BRAND THAT WAY. BUT, THAT SAID WE DON’T BELIEVE IN BILLION-DOLLAR BRANDS. WE ARE TRYING TO BUILD MILLION- DOLLAR LTV CUSTOMERS, NOT BILLION-DOLLAR BRANDS. WE WANT TO HAVE A BILLION- DOLLAR ORGANIZATION, BUT I DON’T THINK ALIEN DOLLAR BRANDS WILL EXIST IN THE FUTURE. I DON’T THINK THERE IS THE NEXT COCA-COLA AS A BRAND, LIKE THE PRODUCT COCA-COLA BEING BUILT RIGHT NOW. BECAUSE, THERE ARE TOO MANY OPTIONS. THERE ARE A LOT OF STARTUPS THAT ARE CREATING A VARIETY OF DIFFERENT PRODUCTS FOR CONSUMERS. NATURALLY, THAT CREATES A LEVEL OF SELECTION THAT CONSUMERS NJOY. AND, THEY WANT TO PARTAKE OF THAT.>>HE ALSO COMPARED DIRTY LEMON AND IRIS NOVA TO NETFLIX DURING THE INTERNET ERA BACK IN 1997. HE REALLY THINKS THIS COMPANY IS SET FOR DESTRUCTION. HE THINKS THE COMPANY IS TARGETING AN INITIAL PUBLIC OFFERING IN THE NEXT 2-3 YEARS ONCE THEY HIT 100 MILLION- DOLLAR YEARS IN ANNUAL REVENUE PROFITABLY.>>THANK YOU EMILY.>>>HANG WITH US, YFI AM IS COMING UP AT THE TOP OF THE HOUR. FLORIDA BUSINESSES ARE BRACING THEMSELVES FOR HURRICANE DORIAN. WE WILL DISCUSS THE BUSINESS IMPACT OF THIS POTENTIAL CATEGORY THREE HURRICANE.>>> THE OPENING BELL IS COMING UP HERE NEXT ON THE FIRST-RATE. LET’S DO A QUICK TRADE OF THE FUTURES. GREEN ALL MORNING LONG. DOW FUTURES UP 234 POINTS, THE S&P 500 AND NASDAQ ARE ALSO IN THE GREEN. HERE IS A QUICK LOOK AT THE ACTION IN THE OVERSEAS MARKETS. >>>WELCOME BACK TO THE FIRST- RATE. THE MARKET IS LOOKING PRETTY GOOD THIS MORNING, THANKS TO ALL THINGS TRADE HEADLINES. DOW FUTURES UP 243 POINTS, THE S&P 500 AND NASDAQ ALSO SOLIDLY IN THE GREEN. A REAL GOOD MORNING SO FAR.>>> LET’S GET AFTER IT WITH DAVID ROSENBERG, AND THE PRESIDENT OF THE NEW ENGLAND RETIREMENT GROUP. GOOD MORNING TO YOU GENTLEMEN. RIGHT NOW, I HAVE TO HIT THIS TWEET FROM THE PRESIDENT OUT A COUPLE OF MINUTES AGO. THE PRESIDENT SAID, THE ECONOMY IS DOING GREAT WITH TREMENDOUS UPSIDE POTENTIAL. WHAT ARE YOUR THOUGHTS ON THAT?>>I STILL WONDER WHY THE PRESIDENT THINKS THAT LOWERING INTEREST RATES BY THE FED WILL DO A LOT FOR THE ECONOMY, BECAUSE THE TEMPLATE IS ALREADY IN FROM WHAT THE BOND MARKET HAS ACCOMPLISHED. THE BIG RALLY IN TREASURIES HAS ALLOWED FOR THIS MOMENTOUS DECLINE IN MORTGAGE RATES OVER THE COURSE OF THE PAST NINE MONTHS. AND YET, THE HOUSING INDICATORS ARE GOING ABSOLUTELY NOWHERE. I THINK SOMEBODY SHOULD TWEET OUT SOMETHING CALLED, PUSHING ON A STRING BECAUSE THAT IS WHAT IS GOING TO HAPPEN WHEN THE FEDS CUT INTEREST RATES. IT IS NOT GOING TO HAVE MUCH OF AN IMPACT ON THE ECONOMY. THAT HAS OTHER HEADWINDS IN FRONT OF IT. AS IS THE CASE WITH MOST OF THE WORLD, JUST CHOKING ON TOO MUCH DEBT. WE ARE NOT GOING TO EXPECT LOWER RATES WILL SPUR ON CREDIT SENSITIVE SPENDING ACTIVITY. I REALLY DON’T THINK THOSE TWEETS MAKE A LOT OF SENSE TO ME. >>NECK, YOUR THOUGHTS ON THAT AS WELL? >>YES, I WOULD AGREE. AT THIS POINT IN TIME, ANOTHER RATE CUT WILL HAVE MINIMAL EFFECTS. CONSUMER CONFIDENCE IS VERY STRONG AND THEY ARE SPENDING MONEY OUT THERE. WE LOOKED AT THE NUMBERS THAT CAME OUT IN EXISTING HOME SALES AND WERE SLIGHTLY STRONGER-THAN- EXPECTED. NEW HOME SALES ARE DOWN BECAUSE OF INVENTORIES. I WOULD AGREE, I THINK WOULD BE SAFE AND SAVE THAT INTEREST RATE CUT WHEN WE NEED IT.>>WE CAME OFF TWO QUARTERS IN THE FIRST QUARTER OF LAST YEAR IN THE FIRST QUARTER OF THIS YEAR WITH REAL SPENDING IN REAL TERMS A LITTLE BETTER THAN A 1% ANNUAL RATE. THAT IS CALLED ALL SPEED. WE PICKED UP IN THE SECOND QUARTER WITH JULY RETAIL SALES THAT WERE PRETTY SOLID. I WOULDN’T SAY THE CONSUMER IS BOOMING. I HAVE BEEN IN THIS BUSINESS FOR TOO LONG AND I KNOW WHAT A CONSUMER BOOM LOOKS LIKE. BUT, THE CONSUMER IS HANGING IN. THE QUESTION ISN’T REALLY IS THE CONSUMER HANGING IN, THE QUESTION WE SHOULD TRY TO ANSWER IS, WILL THE CONSUMER CONTINUE TO HANG IN? BECAUSE, YOU DON’T TALK EXPERTS THROUGH A GLOBAL TRADE WERE. YOU DON’T SHOCK CAPITAL SPENDING, WHICH BASICALLY HAS GONE INTO A RECESSION OF ITS OWN. THERE MUST BE LIKE HIM PICK ON OTHER COMPONENTS OF THE GDP. BUSINESSES ARE CUTTING CAPITAL SPENDING. WE SHOT A DROP OF BUSINESS ORDERS AND SHIPMENTS. THEY WERE VERY POOR YESTERDAY. WHEN BUSINESS STARTS TO CAP CAPITAL SPENDING, THEY START TO CAP THEIR HIRING PLANS. THAT LEADS TO UNEMPLOYMENT AND WAGES DECLINE. IF YOU ARE DRIVING THE FORECAST BY LOOKING THROUGH THE FRONT WINDOW INSTEAD OF THE REARVIEW MIRROR, I WOULD SAY THERE ARE QUESTION MARKS IN FRONT OF THE CONSUMER. WHILE PEOPLE TALK ABOUT HOW WONDERFUL THE CONSUMER CONFIDENCE REPORT WAS, THEY DON’T MENTION THE FACT THAT EXPECTATIONS ACTUALLY ROLLED OVER. EXPECTATIONS FOR FUTURE ECONOMIC CONDITIONS ROLLED OVER. EXPECTATIONS FOR JOBS AND FOR PERSONAL INCOME ACTUALLY WEAKENED OFF MATERIALLY IN THE LATEST CONSUMER CONFIDENCE REPORT. AND NOBODY TALKS ABOUT IT. THOSE ARE THE KEYS, IF YOU WANT TO FORECAST THE FUTURE INSTEAD OF THE PRESENT AND THE PAST. >>JARED, LET’S GET OVER TO YOU. WHAT ARE YOU LOOKING AT?>>WE HAVE A GLOBAL INDEX HERE. WE SAW WEAKNESS IN ASIA. BUT REALLY, TOKYO AND SHANGHAI WERE DOWN ONLY FRACTIONALLY. THE DAX IN BERLIN AND LONDON WERE BOTH UP ABOUT 1% ALONG WITH U.S. MARKETS. YOU CAN SEE S AND P FUTURES ARE UP NEARLY 1%. IF WE LOOK AT A TWO-MONTH CHART, WE CAN SEE THE MARKET IS GOING LARGELY SIDEWAYS SINCE EARLY AUGUST. I WILL POINT OUT THROUGH THE S&P 500, BOTH THE GROSS INDICATOR SHOWS THE INDICATION THAT STOCKS HAVE BEEN STEADILY MAKING HIGHER HIGHS AS THE MARKET HAS BEEN GOING SIDEWAYS. THAT COULD BE BULLISH FOR THE MARKET. ALSO COMING INTO THE MONTH END, AS I HAVE BEEN SAYING WE HAVE BONDS OUTPERFORMING STOCKS I SUCH A LARGE DEGREE WE COULD SEE PENSION FUNDS ROTATING OUT OF BONDS AND INTO STOCKS REAL QUICK, WHICH COULD BOOST STOCKS INTO THE CLOSE TOMORROW. THE KEY LEVEL FOR THE S&P TO CLIMB THROUGH IS 2940 OR 2950 IN THE CASH MARKET. >>I APPRECIATE THAT POSITIVE MARK. JARED, WE ARE LOOKING AT THE OPENING BELL RIGHT NOW. THE DOW IS UP AND OPENS AT ABOUT 218 POINT. WE ARE LOOKING FOR SOME FOLLOW- THROUGH AFTER YESTERDAY. NECK, INTERESTING NEWS OUT TODAY ON THE RETAIL FRONT. WE HAVE A COMPANY LIKE FOREVER 21 POTENTIALLY FILING FOR BANKRUPTCY. ONE OF MANY RETAILERS CONTINUING TO STRUGGLE. BEST BUY AND ABERCROMBIE FITCH NOT GOOD. WHAT YOU MAKE OF THE RETAIL SECTOR RIGHT NOW? >>SURE, I THINK THE STRENGTH WE HAVE SEEN IN THE RETAIL SECTOR IS THE TARGETS, THE T.J. MAXX IS AND THE RETAILS THAT ARE STANDALONE. IF YOU LOOK AT THE FOREVER 21’S AND A LOT OF THE SMALLER MALL DRIVEN RETAILERS, THOSE ARE THE ONES STRUGGLING. AS WE KNOW MALL TRAFFIC OVER THE PAST DECADE CONTINUES TO ERODE. I THINK THE STRENGTHS CONTINUE TO BE THE BIG BOX POWERHOUSES LIKE I JUST MENTIONED THAT HAVE THE SUSTAINABILITY AND WILL BE LESS AFFECTED BY THE TERRACE. BECAUSE, THEY HAVE PRICING POWER. AGAIN, A SMALL FOR EXAMPLE, FOREVER 21 WILL BE AFFECTED BY THE TERRACE.>>NICK, FOREVER 21 IS NOT A SMALL CHAIN BY ANY STRETCH OF THE IMAGINATION. YOU THINK A BANKRUPTCY FOR THEM COULD BLEED OVER INTO OTHER RETAILERS? >>OF COURSE, BUT COMPARED TO A WALMART OR TARGET THAT WAS MY REFERENCE. >>DAVID, IN YOUR VIEW HOW WEAK IS THE U.S. ECONOMY RIGHT NOW? >>WELL, I THINK WE ARE TREADING WATER RIGHT NOW. THE UNDERLYING TREND IS AROUND 2%. BUT, THAT IS BECAUSE 70% OF THE ECONOMY, CALLED THE CONSUMER IS HANGING IN REASONABLY WELL. THERE ARE A VARIETY OF SECTORS THAT ARE REALLY HURTING. COMMERCIAL CONSTRUCTION IS BASICALLY FLAT. HOUSING IS IN A 5/4 TAILSPIN AND THERE IS NO SIGN OF NEAR TERM IMPROVEMENT. MORTGAGE APPLICATIONS FOR NEW HOME PURCHASES HAVE DECLINED IN SIX OF THE PAST SEVEN WEEKS BY 15%. SO, HOUSING IS HURTING, COMMERCIAL CONSTRUCTION IS FLAT AND I MENTIONED BEFORE THAT CAP EX IS ENTERING INTO A DOWNTURN. THEY ALL LOOK FOR EXPERTS. LET’S FACE IT, IF THE INDICATOR IS DOWN 18 MONTHS IN A ROW, THE GLOBAL ECONOMY IS SLOWING DOWN. THAT HAS AN IMPACT ON THE EXPORT SECTOR. THE OVERALL ECONOMY IS DOING FINE BECAUSE OF THE CONSUMER. BUT ACTUALLY, IF YOU LOOK AT U.S. GDP ON A MEDIAN SECTOR BASIS, IF YOU LOOK AT THE GDP LIKE SOME PEOPLE LIKE TO LOOK AT THE S&P 500, AND LOOK AT THE MEDIAN SECTOR OR MEDIUM STOCK PERFORMANCE, THE ECONOMY IS ACTUALLY FLAT RIGHT NOW. THE QUESTION IS GOING TO BE, WILL THE CONSUMER CONTINUE TO HANG IN? MY SENSE IS THAT IT WILL BE PUT TO THE TEST BECAUSE BUSINESSES DON’T CUT CAPITAL SPENDING WITHOUT CUTTING SOMETHING ELSE. AND EMPLOYMENT IS GOING TO BE NEXT. THAT WILL BE THE SAME HEADING INTO WORDS YEAR END AND 2020. SO, YES I WOULD SAY RIGHT NOW AT U.S. ECONOMY SEEMS TO BE DOING OKAY, ALL IN. BUT THAT IS ONLY BECAUSE OF ONE SECTOR THAT DOMINATES THE WHOLE GDP. >>JARED, WHAT YOU HAVE OVER THERE AT THE BIG BOARD?>>WE HAVE THE NASDAQ HEATING UP. ALL 100 STOCKS IN THE GREEN LED BY ALL THE BEAUTY UP THREE AND HALF PERCENT.IT HAS BEEN ON A REAL TEAR RECENTLY, FOLLOWED BY DOLLAR TREE ON THE EARNINGS BEAT. AND WE SEE THE CHIP STOCKS, WESTERN DIGITAL, MICRON AMD, ALL OF THEM ARE 2% OR NEAR 3% FOLLOWED BY AMERICAN AIRLINES FOLLOWING YESTERDAY’S THREE OR 4% JUMPS. AT THE BOTTOM, WE ONLY SEE PROTECTS WHICH WAS INITIALLY READ. IT IS CLOSE TO THE UNCHANGED LINE. IT LOOKS LIKE CYCLICAL IS DOING WELL ESPECIALLY IN THAT CHINA NEWS. I AM NOT SURPRISED THE CHIP STOCKS ARE DOING WELL.>>NICK, DO YOU THINK WE ARE SET UP TO A THIRD-QUARTER DIRECTION IN THE MARKETS?>>I THINK IT WILL BE REALLY VOLATILE. WE ARE IN A TRADING RANGE RIGHT NOW BETWEEN 29 AND 50 FOR THE TOP SIDE OF THE S&P AND MAYBE 2850 AND SOMEWHERE IN THAT RANGE. IT DEPENDS ON WHAT THE FED DOES IN SEPTEMBER. I CERTAINLY WOULD EXPECT IT IF WE COULD SEE ANOTHER FIVE OR 6% TO THE DOWNSIDE. THE S&P IS DOWN A LITTLE BIT. AT THE END OF THIS YEAR, AS I MENTIONED THE MARKET IS PROBABLY GOING TO BE BACK BY WHERE IT WAS IN THE THIRD WEEK OF JULY. >>DAVID, YOU TICKED OFF SOME DOWNWARD PRESSURE IN MEETING SOME INDICATORS. DO YOU THINK WE COULD HAVE A FOURTH-QUARTER CORRECTIONS? >>IT IS HARD TO SAY YOU WILL GET A HUGE CORRECTION IN THE OVERALL STOCK MARKET, BECAUSE IF MY FORECAST OF WEEK GROWTH COMES TO FRUITION, THERE WILL BE PLACES TO HIDE, AS THERE HAS BEEN ALL YEAR LONG. THE ONLY REASON WHY THE STOCK MARKET IS ONLY 4% OF THE HIGHS IS BECAUSE THE SORT OF STUFF YOU WANT TO OWN IN A RECESSION OR DOWNTURN HAVE HELD UP REMARKABLY WELL. UTILITIES AND CONSUMER STAPLES AND THE MORE DEFENSIVE SECTORS. IF YOU LOOK TO THE COMPOSITE OF THE MOST ECONOMIC SENSITIVE SEGMENTS OF THE S&P 500, THEY ARE DOWN 17% FROM THE HIGHS. THEY ARE TELLING US THE SAME MESSAGE THE YIELD CURVE IS. I WOULD SAY THAT WHAT YOU WANT TO DO IN THE EQUITY MARKET IS IGNORE THE HEADLINE MAJOR AVERAGES, PASSIVE INVESTING IS OVER. AND FOCUS ON THE MADDOX. I THINK YOU MENTIONED BEFORE, WALMART AND TARGET. WALMART WAS THE ONLY STOCK THAT MADE MONEY IN THE GREAT RECESSION. TARGET HAS BEEN THE BEST PERFORMING STOCK IN THE S&P 500 SO FAR IN AUGUST. ONE OF THE THEMES BEYOND EVERYTHING ELSE MENTIONED WAS THE TRADE DOWN THEME. THE FRUGALITY THEME. I WOULD SAY THAT YOU CAN LOOK AT DIFFERENT SCHEMATICS AND IDEAS BEHIND THE MARKET ITSELF. I WOULD SAY THOUGH, THE RISK AND STAY AS DEFENSIVE OR NON- ECONOMICALLY EXPOSED AS POSSIBLE WITHIN THE CONFINES OF THE STOCK MARKET. AND, I THINK YOU WILL DO JUST FINE. NO MATTER WHAT THE HEADLINE AVERAGE DOES. >>JARED, WHAT YOU HAVE FOR US? BEE PER DAVID’S POINT, WE ARE LOOK AT THE SECTORS GOING BACK FIVE MONTHS. UTILITIES AND STAPLES ARE IN THE GREEN FOLLOWED BY HEALTHCARE. THEY ARE STILL OUTPERFORMING, BUT DOWN 2%. ENERGY HAS BEEN GETTING KILLED THIS YEAR. FINANCIALS ARE DOWN 6% AND MATERIALS 4% AS WELL AS INDUSTRIAL DOWN 4%.>>THANK YOU. WE WILL LEAVE OUR CONVERSATION THERE. DAVID ROSENBERG, THE DCU.>>> NOW LET’S GET OVER TO INES FERRE DOWN AT THE U.S. STOCK EXCHANGE. >>WE ARE LOOKING AT THE DOW THAT IS UP ABOUT 300 POINT. THE S&P IS UP AND THE NASDAQ IS GAINING THE MOST AZTEC IS LEADING THE GAMES THIS MORNING. WE ARE WATCHING BEST BUY AFTER THEIR ADJUSTED QUARTERLY EARNINGS CAME IN ABOVE AVERAGE. REVENUE CAME IN BELOW ESTIMATED. AND TAKING A LOOK AT DISCOUNT RETAILERS LIKE DOLLAR TREE THAT SEEING A BIT OF A POP AFTER THEIR EARNINGS CAME IN BELOW ESTIMATES. BUT, THE REVENUE CAME IN ABOVE ESTIMATES. AND STORE SALES WERE UP 2.4%. THAT IS MORE THAN WHAT THE STREET WAS EXPECTING REGARDING TARIFFS. THE COMPANY IS IMPLEMENTING ACTIONS TO MITIGATE ANY TARIFF INCREASES. THIS MORNING, WE ARE ALSO WATCHING DOLLAR GENERAL. WE ARE SEEING IT POP AFTER THEIR SECOND QUARTER RESULTS. RIGHT NOW, THE DOW IS UP 300 POINT. >>THANK YOU. TREASURY SECRETARY STEVE NEWSON SAID IN A NEW INTERVIEW, THE U.S. WILL NOT BE INTERVENING IN THE U.S. DOLLAR RIGHT NOW. HE IS ALSO LOOKING HARD AT A POTENTIAL 100 YEAR BOND ISSUANCE. BRIAN CHEUNG IS HERE NOW WITH MORE.>>THE IDEA HERE IS THAT THE CURRENT GOVERNMENT HAS A BIG FISCAL GOVERNMENT DEBT AND THEY THINK THEY COULD CORRECT THAT BY ISSUING A NEW BOND. WE HAVE SEEN THERE IS A STRONG DEMAND FOR U.S. GOVERNMENT BONDS OVER TIME. WE HAVE SEEN DEALS ACROSS THE BOARD, WHETHER YOU ARE LOOKING AT THE TWO YEAR OR 10 YEAR. THE YIELDS HAVE COME DOWN AMID GLOBAL DEMAND, AND IT HAS INVERTED THE CURVE. AT SOME POINT WE SAW THE 30 YEAR AND THREE MONTHS, TWO EXTREMES INVERT BRIEFLY YESTERDAY. WHAT WE ARE SEEING IS THERE IS A LOT OF DEMAND FOR THIS. MAYBE IF THE ADMINISTRATION WAS INTERESTED IN PLUGGING SOME OF ITS DEFICIT, THEY COULD ISSUE THIS BOND. BUT, THEY ARE NOT INTERESTED IN DOING THAT RIGHT NOW. THEY ARE INCLUDING AS PART OF THE SURVEY. THEY WANT TO KNOW IF THERE WAS INTERESTED.>>LET’S GO TO THE $. THE PRESIDENT SAID HE WOULD LIKE THE DOLLAR TO BE WEAKENED. >>YES, PRESIDENT TRUMP HAS MADE NO SECRET THAT HE THINKS THE DOLLAR IS TOO STRONG. THAT INTUITIVELY MAKES SENSE, BECAUSE IT HURTS U.S. EXPORTS AND MAKES IT MORE EXPENSIVE FOR OTHER COUNTRIES TO GET U.S. DOLLARS TO BUY U.S. GOODS, IF THEY DON’T HAVE U.S. DOLLARS. THE TREASURY HAS THE ABILITY TO COORDINATE WITH THE FEDERAL RESERVE AS IT HAS DONE IN THE PAST, TO BASICALLY BUY OTHER FOREIGN CURRENCY TO WEAKEN THE U.S. DOLLAR. IT IS A LOT OF MOVING PARTS, BUT IT IS PART OF WHAT THEY CALL THE EXCHANGE STABILIZATION FUND IT HAS ONLY BEEN DONE A FEW TIMES IN THE PAST IT IS UNSURE ABOUT TO WHAT EXTENT, GIVEN THE REALLY STRONG STRENGTH WE HAVE SEEN AND THE U.S. DOLLAR, YOU CAN SEE THE INDEX THAT WOULD ACTUALLY DO SOMETHING. THE TREASURY SAID FOR RIGHT NOW THEY ARE NOT INTERESTED IN DOING THIS. >>THIS DOLLAR STRENGTH IS BIZARRE. WE HAVE WEEKEND GROWTH. YOU HAVE THE FED LOWERING RATES. >>THERE ARE A LOT OF MOVING PARTS. FOR WHAT IT IS WORTH, IT WOULD BE FAIRLY UNPRECEDENTED FOR THIS KIND OF CHANGE TO HAPPEN. FOR THE TREASURY TO COORDINATE WITH THE FEDERAL RESERVE TO MAKE THIS CHANGE. AGAIN, THEY WOULD LIKE TO COORDINATE WITH THE FED, AS WE HAVE SEEN THEY ARE NOT INTERESTED IN TRYING TO FUEL RESIDENT TRUMPS TRADE WAR.>> GOOD TO SEE YOU. >>>CHINA’S LATEST MOVE TO EAT THE TENSIONS OVER TRADE, HAVE THE OIL MARKETS MOVING THIS MORNING. JARED IS BACK. >>WE HAVE TO OIL UP ABOUT HALF A PERCENT. THAT IS OFF THAT TRADE NEWS. BUT, NOT TRACKING EQUITIES. STOCKS ARE UP ABOUT 1% OR CLOSE TO THAT RIGHT NOW. GIVEN THE BULLISH NEWS WE HAVE SEEN OVER THE LAST TWO DAYS, IT IS NOT THE MOST CONVICTION TO THE UPSIDE. HERE IS A TWO DAY CHART. HERE IS THE REPORT YESTERDAY FROM THE DEPARTMENT OF ENERGY SHOWING THAT U.S. STOCKPILES FELL TO THEIR LOWEST LEVELS SINCE OCTOBER. CHECK IT OUT. THEY ALSO SAID THAT THE PRODUCTION IN THE U.S. HAS REACHED AN ALL-TIME HIGH. THAT IS FROM RECORDS GOING BACK TO 1983. THAT IS 12 1/2 MILLION BARRELS PER DAY. úWE SAW OIL BACK OFF O WE GOT THE TRADE NEWS THIS MORNING. AND WE CAN SEE ON A LONGER-TERM CHART, WE ARE GOING TO LOOK AT A CANDLESTICK CHART. WE HAVEN’T BEEN ABLE TO MAKE MUCH HEADWAY HERE. AGAIN, ANYTIME WE GET SOME BULLISH NEWS, ONCE WE GET INTO THIS LEVEL THAT IS 56-57, WE SEE THE MARKET SELLING OFF. AGAIN, IT LOOKS LIKE THE BEARS ARE MAINTAINING CONTROL OF THIS MARKET FOR THE TIME BEING. >>JARED, WHAT IS THE LATEST ON SILVER AND GOLD.>>LET LOOK AT SILVER. THIS IS A TWO-MONTH CHART. WE CAN SEE ALL OF THESE GREEN CANDLES. IT IS ADVANCED ABOVE THE 18 LEVEL. THIS IS THE HIGHEST LEVEL IN ABOUT TWO YEARS. WE DON’T HAVE MUCH RESISTANCE IF WE GO ABOVE HERE UNTIL 19. AND THE $20 LEVEL, WE ARE SEEING INCREDIBLE FLOWS INTO ETS, THE HIGHEST EVER GOING BACK TO 2006. WE HAVE SEEN FUNDS MOVED INTO SILVER FUTURES AND SILVER ETF’S FOR OF THE LAST SIX OR SEVEN WEEKS. INCREDIBLE PRICE ACTION. IF WE LOOK AT GOLD, NOT QUITE AS IMPRESSIVE, BUT IT IS BASING AND ADVANCING. THIS IS THE PATTERN WE ARE SING. IT IS BASING AND ADVANCING, BASING AND ADVANCING AND JUST HANGING OUT ABOVE THE 1550 LEVEL FOR RIGHT NOW. >>THANK YOU JARED. >>>DISNEY BUS COULD BE EVEN MORE INSANELY POPULAR THAN ANYONE EXPECTED THAT IS ACCORDING TO A NEW SURVEY. WE HAVE BEEN DIGGING INTO THESE NUMBERS. JULIA, A POTENTIAL BOON FOR DISNEY. >>IT TO BE EVEN BIGGER THAN THEY EXPECTED. AND UBS DID A SURVEY OF 1000 PEOPLE AROUND AUGUST 12th MINUS 14, AND THEY FOUND 43% FOUND THE INTENT TO JUST SUBSCRIBE TO DISNEY PLUS. BREAKING THOSE NUMBERS DOWN FURTHER, 4% SAID THEY ARE EXTREMELY LIKELY, 12% SAID THEY ARE MORE LIKELY. DISNEY HAS 20% PENETRATION OF U.S. SOCIAL. IT MIGHT BE MORE POPULAR THAN THE COMPANY IS GUIDING FOR. I WILL ALSO NOTE THAT BACK IN THE SPRING, APRIL OR MAY UBS DID A SURVEY OF 2000 PEOPLE AND FOUND THAT 43% WERE INTERESTED, BUT THE INTENTION, THE INTENT TO SUBSCRIBE IS WHAT IS NOTEWORTHY. IT IS A YOUNGER DEMOGRAPHIC AND THOSE ARE SOME OF THE INSIGHTS FROM THE SURVEY.>>IT LOOKS LIKE DISNEY IS SITTING ON A POTENTIAL GOLDMAN. WHAT DOES THAT MEAN FOR NETFLIX? BEE 67% OF EVERYONE SURVEYED SAID THEY DID NOT INTEND TO CANCEL ANOTHER STREAMING SERVICE. BUT, 57% OF THOSE WHO SAID THEY ARE INTENDING TO SUBSCRIBE, SAID THEY MAY WANT TO CANCEL ONE OF THE OTHER EXISTING SERVICES. SO, I DON’T KNOW WHAT THAT MIGHT MEAN FOR NETFLIX. THERE ARE OTHER COMPETITORS AS WELL IN THIS SPACE. IT REALLY COMES DOWN TO HOW YOU ARE GOING TO GARNER THAT WALLET SHARE. >>GOOD RESEARCH. TO CO. >>>APPLE IS APOLOGIZING TO USERS FOR LETTING CONTRACTORS LISTEN TO THEIR TO RECOMMENCE. BUT, THE APOLOGY COMES ALONG WITH A PROMISE TO CHANGE. CONTRACTORS LISTENING TO THE COMMANDS TO IMPROVE THE SERVICE. YAHOO TECH EDITOR, DAN HOWLEY IS HERE.>>NO GOOD. THIS IS ESSENTIALLY, THE CONTROVERSY AROUND THIS IS INTERESTING TO ME. BECAUSE, WHEN YOU HAVE THESE SMART ASSISTANTS, THESE VOICE ASSISTANTS, THE NATURAL INKLING I HAVE, AT LEAST IS SOMEONE CAN HEAR WHAT I AM SAYING. I UNDERSTAND THAT PEOPLE MIGHT BE FREAKED OUT ABOUT THAT, BUT IF YOU TALK INTO A PIECE OF TECHNOLOGY, SOMEONE IS GOING TO HEAR WHAT YOU SAY AT SOME POINT. NEVER ASSUME THAT WHAT YOU DO ONLINE IS PRIVATE. WHAT THEY ARE DOING HERE IS ESSENTIALLY GOING TO STOP LETTING PEOPLE LISTEN TO IT FREELY. WHAT IS GOING TO HAPPEN IS, YOU ARE GOING TO HAVE TO OPT IN TO ALLOW PEOPLE TO LISTEN TO YOU. AND, THE PEOPLE THAT ARE GOING TO LISTEN TO IT WILL BE SPECIFICALLY APPLE EMPLOYEES. THERE IS A REASON WHY PEOPLE LISTEN TO IT. IT IS NOT BECAUSE THEY ARE WIDOWS DOING THIS IN THEIR ROOM IN THE MIDDLE OF THE NIGHT. THEY ARE DOING THIS BECAUSE THEY ARE TRYING TO IMPROVE THE VOICE RECOGNITION TECHNOLOGY. AND OMA THE ONLY WAY YOU CAN DO THAT IS BY SEEING, THIS PERSON SAID X AND THE COMPUTER HEARD Y. HOW CAN WE MAKE IT THE SAME THING? THAT IS WHAT THIS IS ALL ABOUT. IT IS NOT BECAUSE THEY ARE TAKING OUR DATA TO SELL ADS OR ANYTHING LIKE THAT. IT IS TAKING THE DATA TO IMPROVE THE SERVICE WE USE. >>I DO NOT WANT TO HELP APPLE. SO, ME OPT OUT IMMEDIATELY.>> YOU KNOW, YOU HAVE TO OPT IN. THIS HAS BEEN GOING ON SINCE VOICE COMMANDS HAVE BEEN NOTHING. THIS IS, GOOGLE HAS DONE IT, AMAZON HAS DUET DONE IT AND FACEBOOK AND GOOGLE ARE DOING IT. WHEN YOU HAVE SOMETHING LIKE THIS, THESE ALGORITHMS AND MACHINE LEARNING IS WHAT IT CHOOSES. COMPUTERS ARE DUMB. THEY ARE GREAT AT DOING PROCESSES, THEY ARE PRETTY MUCH DONE. THEY LEARN BY WHAT WE TEACH THEM. WE HAVE TO TEACH THEM HOW TO RECOGNIZE VOICE BY FEEDING THEM GOOD VOICE SAMPLES. TO DO THAT, WE HAVE TO KNOW WHAT THAT VOICE SAMPLE IS. FOR THEM, FOR A COMPUTER TO RECOGNIZE THAT I AM SAYING CALL MOM, IT HAS TO HERE A PERSON SAY, CALL MOM. AND SOMEBODY HAS TO FEED THAT TO THE MACHINE. THAT IS WHY THEY WERE LISTENING TO US. I RECOGNIZE THAT SOME PEOPLE MIGHT BE UPSET ABOUT THAT. YES, THERE SHOULD BE MORE KNOWLEDGE ABOUT IT AND THEY SHOULD MAKE IT VERY EXPLICIT THAT PEOPLE WERE LISTENING. BUT THE WAY APPLE IS APPROACHING IT IS THE RIGHT WAY. THEY AUTOMATICALLY OPT YOU OUT. IF YOU WANT TO HELP IMPROVE THEORY, YOU HAVE TO OPT IN. >>DOES THIS FORCE AMAZON AND ALPHA TO CHANGE HOW THEY HANDLE THEIR SERVICES?>>YES, WHAT WILL HAPPEN NOW IS, APPLE HAS ALREADY BEEN PUSHING ITSELF TO THE FOREFRONT OF PRIVACY AND SECURITY. THIS PUTS A MARK ON THAT AND THEY WANT TO REPAIR THAT. IF OTHER COMPANIES WANT TO CONTINUE TO DO THIS SORT OF THING, THEY HAVE TO ALLOW FOR OPTING IN, INSTEAD OF BEING AUTOMATICALLY OPTED IN. YOU SHOULD BY DEFAULT BE OPTED OUT FROM SOMETHING LIKE THIS. AND, HAVE TO OPT IN IF YOU WANT TO HELP. THAT IS HOW THOSE COMPANIES WILL GO. IF, THEY WANT TO PLAY THE PR ROLE.>>GOOD TO SEE YOU. >>>A WIDER EFFORT TO CURB ILLEGAL SALES TO SALES TO MINORS. ZACH IS IN THE NEWSROOM ON THIS ONE. BEE IT GOES A LITTLE BIT FURTHER THAN MOST AGE VERIFICATION SYSTEMS THAT SOFTWARE HAS DONE IN THE PAST. JUUL WILL REQUIRE RETAILERS TO ESSENTIALLY CARD EVERYBODY, REGARDLESS OF HOW YOUNG OR OLD LOOK TO VERIFY ITS USERS OR CUSTOMERS ARE ACTUALLY 21 YEARS OF AGE. THE COMPANY SAID THE DATA WILL BE TAKEN FROM A SWIPE OF A CUSTOMERS I D, AND DATA WILL BE DELETED AS SOON AS THE PURCHASE IS COMPLETED. OVERALL, JUUL OF COURSE, THE LARGEST E-CIGARETTE MANUFACTURER IN THE U.S. CONTROLS ABOUT THREE QUARTERS OF THE MARKET HERE IN THIS COUNTRY. THAT COMPANY IS GOING TO BE PROVIDING $100 MILLION TO RETAILERS TO GET THEM TO ADOPT THIS NEW AGE VERIFICATION SYSTEM BEFORE MAY 21 HE. IF NOT, THE RETAILERS WILL NOT BE ABLE TO SELL THE COMPANY’S E- CIGARETTES. >>JUUL HAS MADE SOME INTERESTING MOVES THE PAST SEVERAL MONTHS. ARE THEY HURTING THEIR BUSINESS? ARE THEY TAKING SALES OR POTENTIAL SALES OFF THE TABLE? BEE PART OF IT COMES DOWN TO THE FACT THAT THE FDA HAS BEEN RATCHETING UP SCRUTINY WHEN THEY LOOK AT THIS COMPANY. WE ARE AT A POINT NOW, WHERE MORE THAN 1-5 HIGH SCHOOLERS HAVE REPORTED VAPING WITHIN THE LAST YEAR. THEY KNOW THIS IS AN EPIDEMIC. THE COMPANY IS INCREASINGLY REALIZING THE RISK MAY EXIST IF THEY DON’T STEP IN AND DO THINGS. WE HAVE SEEN THEM MOVE FURTHER AND FURTHER ALONG IN TRYING TO MAKE SURE THEIR PRODUCT GETS TAKEN OUT OF THE HANDS OF TEENAGERS, BECAUSE THEY REALIZE THIS IS AN INCREASING PROBLEM. WE HAVE SEEN THEM TAKE STEPS ALONG THIS PATH, OF COURSE THEY ANNOUNCED LAST YEAR THEY WILL BE TAKING FLAVORED E-CIGARETTES OUT OF STORES AND MAKING SURE RETAILERS AND MORE LOCATIONS ARE GOING TO SELL THOSE PRODUCTS , TO MAKE SURE TEENS DON’T USE THOSE. THEY ARE RATCHETING UP THOSE EFFORTS AND THIS IS ONE OF THOSE EXAMPLES. OF COURSE, WE HAVE SEEN WALMART, WALGREENS, RITE AID ALL COME UP WITH WARNINGS FROM THE FDA BECAUSE THEY HAD BEEN SELLING PRODUCTS TO UNDERAGE USERS. NOW, JUUL MAKING SURE THESE RETAILERS HAVE THE RESOURCES TO MAKE SURE THESE PRODUCTS ARE NOT WINDING UP IN THE HANDS OF TEENAGERS. THE COMPANY, AS I SAID PUTTING UP $100 MILLION TO MAKE SURE RETAILERS ARE PUTTING THESE EFFORTS INTO PLACE AND WILL BE COMPENSATED. IF USERS WHO WERE A BADGE AGE 21 ACTUAL SEE THIS AS A PROBLEM AND START TO REDUCE THEIR JUUL PURCHASES. >>HAVE ANY RETAILERS SIGNED UP FOR THIS NEW AGE VERIFICATION SYSTEM? >>WE HAVE SEEN A FEW. RIGHT NOW, JUUL IS SAYING HUNDRED 90,000 LOCATIONS ACROSS THESE MAIN RETAILERS HAVE ALREADY SIGNED UP. ONE OF THEM BEING CUMBERLAND FARMS AND ANOTHER ONE QUICK TRIP WE HAVE SEEN RETAILERS COME ON. IF THEY DON’T, BY 2021, THEY WANT BE ABLE TO CELL THESE PRODUCTS. THAT IS ONE OF THE THINGS THESE RETAILERS ARE SING. THEY ARE HOPING PEOPLE ABOVE AGE 21 WILL COME IN AND BRING IN MORE FOOT PRODUCT AND TRAFFIC.>>>THE BIGGEST EVENT OF THE YEAR WILL BE HERE VERY SOON. THE YAHOO FINANCE ON MARKET SUMMIT IS SET FOR OCTOBER 10 RIGHT HERE IN NEW YORK CITY. FOR MORE DETAILS, OUR GUESTS WILL BE SHOWN ON THE WEBSITE.>>>COMING UP, ABERCROMBIE IN SIX IS OUT WITH WE WILL TALK TO THE CEO ABOUT WHAT TO EXPECT OVER THE NEXT QUARTERS. >>>THE DOUBT IS LOOKING PRETTY DARN GOOD TODAY. IT IS UP ABOUT 291 POINTS. NOT BAD, THE S&P 500 UP ABOUT 1.2%. LOOKING GOOD THERE AS WELL. LAST, BUT NOT LEAST IS THE NASDAQ. ALSO IN THE GREEN. WE WILL BE RIGHT BACK. >>>WELCOME BACK. YOU RETURNED TO A LOT OF GREEN ON THE SCREEN. DOW IS UP 293 POINTS, THE S&P 500 AND NASDAQ ARE SOLIDLY IN THE GREEN. THANKS TO THOSE SOMEWHAT BULLISH TRADE WAR HEADLINES OVERNIGHT.>>>HERE IS A RUNDOWN OF SOME OF THE COMPANIES THE YAHOO FINANCE TEAM IS WATCHING FOR YOU TODAY. DOLLAR GENERAL STOCK JUST GOT MORE EXPENSIVE. THE DISCOUNTER POSTED BIG EARNINGS THIS MORNING. SALES WERE UP FOR PERSONA, NEARLY DOUBLE THE EXPECTATIONS. STRENGTH IN ALL DEPARTMENTS. DOLLAR GENERAL IS ALSO RAISING OTHER THINGS. GUEST POSTED HUGE BEATS LAST QUARTER ON THE BOTTOM AND TOP LINES. MANAGEMENT RAISED THEIR FULL- YEAR GUIDANCE RAISING OPTIMISM ON THE HOLIDAY SHOPPING SEASON. THE CEO PRAISED THE COMPANY’S DIRECTIVE CONSUMER BUSINESS INCLUDING STORES AND e- COMMERCE. THE BIG STANDOUT HERE, EUROPE OR SALES ROSE 9.1%. EARNINGS ESTIMATES ARE BEING CUT FOR APPLE BECAUSE OF THE UNCERTAINTY OF 5G. THERE ARE CONCERNS ABOUT THE OVERALL DEMAND FOR IPHONES, ESPECIALLY DEVICES THAT ARE FIVE CAPABLE. THE GROUP IS IN ENTIRELY SOLD ON OTHER OFFERINGS BY APPLE OF TV PLUS, AND APPLE ARCADE. TESLA OWNERS IN CALIFORNIA CAN PURCHASE A CAR THREW THEIR ELECTRIC AUTOMAKER. ELON MUSK ANNOUNCED TESLA WILL BE ROLLING OUT INSURANCE THAT WILL ALLEGEDLY SAVE TESLA OWNERS AS MUCH AS 30% ON THEIR RACE. IT IS UNCLEAR WHETHER THIS WILL SAVE CUSTOMER MONEY, GIVEN THE MODEL S IS THE MOST EXPENSIVE CAR.>>>UBS CEO IS PUTTING THINGS TO WREST. SERGIO ARMANI HAS LAID A NEW SWISS BANKER THE WEALTH MANAGEMENT AND ITS NEW COED. THEY ARE POINTING A NUMBER OF NEW HITS. THIS IS THE SECOND REORGANIZATION OF THIS DIVISION SINCE 2018, WHEN THE FIRM MERGED THE U.S. AND INTERNATIONAL DIVISION INTO A SINGLE BUSINESS. THOSE ARE YOUR COMPANIES TO WATCH FOR THURSDAY, AUGUST 29th. >>>LET’S ALSO TALK SOME ABERCROMBIE AND FITCH. I GOT TO GO INSIDE THE C SUITE WITH CEO, FRAN HOROWITZ ON THE HEELS OF THEIR LATEST EARNING REPORT OUT THIS MORNING. YOU CAN LOOK AT THIS QUARTER IN TWO WAYS. THE FIRST IS TO SEE THE COMPANY LOST $.40 A SHARE AND IT DIDN’T GROW SAME-STORE SALES AT ABERCROMBIE OR HOLLISTER. BOTH SAW SALES UNCHANGED. THE MARKET DIDN’T LIKE THAT JUST BY THE EARLY ACTION TODAY. THAT IS PROBABLY NOT THE RIGHT WAY TO LOOK AT THINGS. HOROWITZ TELLS ME THINGS HAVE BEEN HAPPENING IN THE BUSINESS. SHE IS RIGHT.IN THE GRAND SCHEME OF THINGS, UNCHANGED SAME STORE SALES AT FOUR DIVISION ARE GOOD GIVEN WEEK MALL TRAFFIC. ABERCROMBIE TELLS ME SALES WERE SOLID IN THE U.S. INTERNATIONAL REMAINS COMPLICATED. NOTHING NEW THERE. IN FACT, ABERCROMBIE AND FITCH’S RESULTS SUGGEST THEY ARE FINALLY TURNING AROUND TO IMPROVED MERCHANDISE INCLUDING JEANS AND ADDRESSES. THE COMPANY DID TURN OUT WITH INSANELY BAD EARNINGS WARNINGS DUE TO TARIFFS. THE COMPANY HAS MOVED PRODUCTION OUT OF CHINA QUICKER THAN OTHERS. BY YEAR END LESS THAN 20% OF MERCHANDISE WILL BE SOURCED BY CHINA. BY 2020 AND, THAT NUMBER SHOULD BE LOW TEENS. ALL IN ALL NOT A BAD YEAR FOR ABERCROMBIE. YOU WANT TO SEE BAD RIGHT NOW, PULL UP THAT GAP QUARTER ON THE YAHOO FINANCE SIDE. THAT WAS A FULL ON DISASTER. PRESSURED SAME-STORE SALES AND PRESSURE MARGINS. A TERRIBLE EARNINGS OUT LATE FOR THE COMPANY. ABERCROMBIE BETTER THAN GOOD.>> THAT IS IT FOR FINANCE THE FIRST TRADE. LET’S GET ONE MORE CHECK OF THE MARKETS WITH INES FERRE DOWN AT THE NEW YORK STOCK EXCHANGE.>> HI BRIAN. RIGHT NOW WE HAVE TECH LEADING THE GAINS. IF WE TAKE A LOOK AT THE DOW IT IS UP 290 POINTS. SOME OF THE DOW LEADERS INCLUDE CATERPILLAR, INTEL, GOLDMAN SACHS, MICROSOFT, DISCOUNT RETAILERS IS THE THEME OF TODAY. THEY ARE AT FIVE BELOW AND SEEING A POP AFTER THEY BEAT AND ADJUSTED EARNINGS LAST QUARTER. THE REVENUE CAME IN THE LOW FORECAST AND THEY DID WIDEN THEIR FULL-YEAR EARNINGS GUIDANCE BECAUSE OF FLUIDITY OF THE TARIFF SITUATION. ALL OF THESE BARGAIN OUTLETS IS NDER PRESSURE THIS MORN TANKING REALLY THIS MORNING. THEIR ADJUSTED EARNINGS AND NET SALES CAME BELOW ESTIMATES AND WHAT THE COMPANY SAID IT WAS A TOUGH QUARTER. THEY POINTED TO CHALLENGES LIKE THE RAPID PACE OF STORE OPENINGS AND ALSO A SUPPLY- CHAIN PRESSURE. WE ARE WATCHING BURLINGTON STORES THIS MORNING. THIS IS AFTER THEY POSTED BETTER THAN EXPECTED EARNINGS FOR THEIR LATEST QUARTER. THEIR SALES CAME IN BELOW ESTIMATES. THE COMPANY RAISED ITS UP FOR YOUR GUIDANCE AND SAID INVENTORY, GOING INTO THE úSECO RIGHT CATEGORY. RIGHT NOW, WE ARE LOOKING AT THE DOW THAT IS UP 300 POINTS, THE S&P AND NASDAQ ALSO HIGHER. PERCENTAGEWISE, THE NASDAQ HAS GAINED THE MOST THIS MORNING. MAKE SURE YOU STAY WITH US, YFI AM STARTS RIGHT AFTER THE BREAK. DON’T GO ANYWHERE. WE WILL BE RIGHT BACK. C1 >>>GOOD MORNING AND WELCOME TO YFi AM HERE AT YAHOO FINANCE. I’M DAN ROBERTS, AND WE HAVE BRING AN CHUNG ON THE COUCH, AND LET’S START LOOKING AT THE MARKETS BECAUSE WE ARE SEEING STEAM FROM THE DOW UP 300 POINTS, MORE THAN 1% AND THE NASDAQ UP MORE THAN 1.5% AND THE S&P 500 TRADING HIGHER BY MORE THAN 1%, AND PERHAPS IT’S BECAUSE OF THE POSITIVE ENCOURAGING NEWS ABOUT THE U.S. CHINA TRADE. CHINA SAYING IT WILL NOT BE RETALIATING TO AMERICA’S LATEST RETALIATION IN THE TRADE WAR. THAT IS, OF COURSE, SEEN AS A POSITIVE INDICATOR, AND IT’S PERHAPS TO THANK FOR STOCKS MOVING HIGHER. THE MINISTRY OF FINANCE SAID WE FIRMLY REJECT AN ESCALATION OF THE TRADE WAR AND ARE WILLING TO NEGOTIATE AND ELABORATE IN ORDER TO SOLVE THIS PROBLEM WITH CALM ATTITUDE, CALM ATTITUDE? GOOD. >>WILL THAT WORK? WE ARE STILL TALKING ABOUT PRESIDENT TRUMP. CAN WE RELY ON THE TWEETS BEING CALMER? BUT HE DOES TWEET. IT’S NOT LIKE HE SAID IT. >>I AM EXTREMELY SKEPTICAL, TOO. AND IT’S FUNNY WHEN THE MARKETS MOVE SIMPLY ON ONE STATEMENT. THIS MEANS THERE WILL BE MORE TARIFFS AND BAD NEWS, AND NOW WE’LL DUNK. >>I FEEL LIKE WE’RE IN AN EPISODE OF GROUNDHOG DAY. THE SAME THING OVER AND OVER. THE TRADE TALKS ARE GOING L THEY ARE NOT GOING WELL. THEY ARE GOING WELL AGAIN, AND THE THING TO PAY ATTENTION TO ARE THE DEADLINES. WHEN TRUMP IS INTERESTED IN THE NEW ROUND OF TARIFFS, AND THEN TARIFFS — THOSE ARE MATERIAL THINGS THAT PEOPLE CAN TRADE ON AND CALCULATE WHAT IS GOING ON. I MEAN, THERE IS NOTHING TO SAY ON THE CHINESE SIDE THIS IS JUST BAD AIR. >>AND BRIAN, YOU SAID THIS IS LIKE GROUNDHOG DAY BETWEEN THE TWO WORLD ECONOMIES AND THIS IS STRANGE. BUT LET’S REMEMBER THAT THE SEPTEMBER 1 DEADLINE IS JUST A COUPLE OF DAYS AWAY, AND PRESIDENT TRUMP HAS NOT TAKEN BACK THE TARIFFS ON SEPTEMBER 1, AND CHINA IS LIKE, WELL, MAYBE WE SHOULD BLINK. THIS WILL IMPACT US MORE THAN IT WILL HURT THE U.S. ECONOMY. >>AND WORTH MENTIONING, PRESIDENT TRUMP JUST TALKED WITH FOX NEWS A FEW MINUTES AGO, AND HIGH-LEVEL TALKS WILL CONTINUE, AND WE WILL SEE THE FINAL OUTPUT. SO POTENTIALLY, ANOTHER STATEMENT THAT PEOPLE CAN DETERMINE AS POSITIVE. BEFORE SEPTEMBER 1, I DON’T THINK THERE WILL BE A DEAL BEFORE THE ELECTION. >>OKAY, NO. >>WE’LL SEE. >>LET’S STICK WITH THE NEWS OUT OF CHINA BECAUSE THAT NEWS FROM CHINA ABOUT APPROACHING THE TALKS IN A CALM MANNER IS HELPING STOCKS MOVE HIGHER. NOW WE DO STILL HAVE THE ADDITIONAL TARIFFS ON CHINESE IMPORTS SET TO GO INTO EFFECT ACCEPT 1, JUST A FEW DAYS AWAY, AND JOINING US IS THE MANAGING DIRECTOR OF MILLER TAYBACK. THANK YOU FOR COMING ON, MATT. >>THANK YOU FOR HAVING ME. >>YOU THINK IT WILL BE TOUGH TO SEE A BIG RALLY BACK TOWARDS ALL TIME HIGHS. TELL US ABOUT THAT. >>I THINK WE HAVE A COUPLE OF THINGS. OBVIOUSLY, THE TRADE WAR IS A PROBLEM. AND IT’S, I BELIEVE, ANOTHER HEADWIND THAT KEEPS THE FUNDAMENTALS FROM REALLY IMPROVING. WE HAVE A SITUATION. THE GDP GROWTH IS 2%, AND THAT’S NOT BAD, AND SOME PEOPLE ARE SAYING WE HAVE A GREAT ECONOMY. WE DON’T HAVE A GREAT ECONOMY. WE HAVE A GROWING ECONOMY. IT’S SOLID, AND CONSUMERS ARE KEEPING US IN THERE BUT IT’S SLOWING SOMEWHAT, AND WE ARE SEEING THE EARNINGS GROWTH DOWN, LESS THAN 2%, 1.3% FOR THE FULL YEAR NOW AND THAT’S NOT THE KIND OF GROWTH THAT WE WANT TO SEE THAT WOULD JUSTIFY A MAJOR RALLY AFTER WE RALLIED MORE THAN 15% YEAR TO DATE, AND I THINK THIS TRADE — AS YOU TALKED ABOUT, I DON’T THINK THE TRADE WAR WILL BE RESOLVED ANY I AGREE THAT IT WILL PROBABLY NOT BE UNTIL AFTER THE ELECTION, AND THAT IS THE HEADWIND THAT MAKES IT TOUGH FOR THE MARKET TO RALLY. IT DOESN’T MEAN WE WILL BE AT THE END OF THE WORLD OR HAVE A REPEAT OF 2008 OR ANYTHING LIKE THAT BUT I THINK WHEN THIS THING FLARES BACK UP AGAIN LIKE IT ALWAYS SEEMS TO, WE WILL SEE ANOTHER DOWNDRAFT AND THERE IS A CHANCE AT A FULL-BLOWN DIRECTION BUT THAT’S NOT THE END OF THE WORLD. CORRECTIONS ARE NORMAL AND HEALTHY. >>BRIAN CHEUNG HERE. IT’S INTERESTING TO SEE THE MARKET DYNAMICS. WE SAW ALL TIME HIGHS A MONTH AGO IN THE EQUITIES MARKETS AND CRAZY INFLOWS AND INFLUX OF INCOME AS HAD. SO IT SEEMS LIKE A TRADE OFF BETWEEN THE RISK ASSETS AND RISK OFF OFFSETS, AND DO YOU THINK THERE IS A CORRECTION THAT NEEDS TO TAKE PLACE IN THE EQUITIES MARKET, AND IT’S NOT REFLECTING THE RISK IN THE U.S.? >>I THINK IT’S WEIRD. THE DEBT MARKET WE HAVE TWO PARTS. WE HAVE THE TREASURY MARKET WHICH IS OBVIOUSLY DOING WELL, AND TO IGNORE WHAT THAT IS TELLING US, WHETHER THE YIELD CURVE INVERTING OR RATES STAYING ULTRA LOW, PART OF THAT HAS TO DO WITH THE COMPETITION WITH RATES OVERSEAS BUT GLOBAL GROWTH IS SLOW AND WE HAVE THE RISK OF CORPORATE BOND. A LOT OF PEOPLE ARE WORRIED ABOUT A CORPORATE BOND BUBBLE BLOWING UP BUT IT DOESN’T SEEM LIKE THAT WILL HAPPEN IN THE NEAR FUTURE. MY CONCERN IS I THINK WE’LL NEED A CORRECTION. IT’S ONLY DOWN 5 OR 6% AND PEOPLE SAY THAT’S THE END OF THE WORLD BUT THAT’S NOT IT AT ALL. THE BACKDROP IS SLOWING, AND WOMEN ARE SO CONCENTRATED ON WHETHER WE WILL HAVE A RECESSION OR NOT BUT THAT’S FINE IF YOU ARE WORRIED ABOUT THE BEAR MARKET. I THINK IF PEOPLE RAISE CASH NOW THEY WILL BE ABLE TO TAKE ADVANTAGE OF THE OPPORTUNITY BUT I THINK WE WILL HAVE TO FLUSH THINGS OUT MORE. >>NOW, THE CANACORD ANNUITY CAME OUT AND SAID HE THINKS THE S&P 500 IS ON TRACK TO REACH OVER 3000. DO YOU THINK HE IS COMPLETELY WRONG ON THIS? >>COMPLETELY WRONG, I THINK THAT COULD HAPPEN BUT IT’S WOULD TAKE A HUGE RALLY. SO IT COULD HAPPEN BUT AT WORST, WE WOULD BE DOWN 5 OR 6% AND I THINK THERE IS A BETTER CHANCE OF A FULL-FLOWN DIRECTION, A DECLINE OF 10% BEFORE WE SEE NEW HIGHS. THE BIGGEST THING FOR ME IS I DON’T BELIEVE THAT EITHER THE — CHINA OR THE U.S. WILL GIVE IN ANY TIME SOON ON THE TRADE ISSUE. AND AS MUCH AS PRESIDENT TRUMP WANTS TO BLAME THE FED FOR THE SLOW DOWN IN THE ECONOMY AND PULL BACK IN THE STOCK MARKET THE REAL REASON IS THE TRADE ISSUE. ANYBODY THAT — I’M NOT — YOU KNOW, ANYBODY THAT THINKS OTHERWISE I THINK IS JUST WRONG. THEREFORE I THINK IT WILL BE VERY, VERY DIFFICULT FOR THE S&P 500 TO GET UP TO 3000 THIS YEAR TO BE HONEST WITH YOU. >>ALL RIGHT. I TEND TO AGREE YOU WITH, MATT, THAT IT WILL BE QUITE A WHILE BEFORE WE SEE AN ACTUAL DEAL AND WE HAVE ALL RESHUFFLED THE EXPECTATIONS OF WHAT THE DEAL WILL LOOK LIKE. WE’LL HAVE YOU BACK ON SOON TO DISCUSS. MATT MAL, EY, THANK YOU SO MUCH. >>THANK YOU. >>>THE EPA WILL CURTAIL THE REGULATION OF METHANE GAS EMISSIONS INCLUDING GETTING RID OF OVERSIGHT OF METHANE LEAKS. NOW, THE ROLLBACK IS PARTICULARLY NOTABLE BECAUSE MAJOR OIL AND GAS COMPANIES ARE OPPOSED TO THIS. METHANE IS SEEN AS A MAJOR CONTRIBUTOR TO CLIMATE CHANGE, SECOND ONLY TO CARBON DIOXIDE IN THE EARTH’S SURFACE. AND WE HAVE OUR OIL AND METHANE MAN BACK HERE. [ LAUGHTER ] WHY ARE THE BIG COMPANIES OPPOSED TO THIS? YOU THINK THEY WOULD WELCOME LESS REGULATION AND IT WOULD BE GOOD FOR THEM. >>YOU TAKE LIKE EXXON,BP AND SHELL, AND THEY ARE FOR THIS. IN AN INDUSTRY WHERE YOU HAVE A LOT OF BIG PLAYERS, IF YOU ARE GOING TO ADOPT A NEW TECHNOLOGY TO COST MORE MONEY T WILL CROWD OUT THE SMALLER PLAYERS. THEY WILL NOT BE AS PROFITABLE, AND THAT MAY BE WHY. BUT WE ARE TALKING ABOUT A TOTAL COST SAVINGS OF $17 TO $19 BILLION, A DROP IN THE BUCKET. TRUMP ALREADY PUSHED THE DEPARTMENT OF THE INTERIOR TO DO SOMETHING UNILATERALLY BECAUSE THEY CAN DO THAT WITH RESPECT TO METHANE LEAKAGE IN NATIVE-AMERICAN LAND BUT YOU LOOK AT THE LARGER PICTURE HERE AND METHANE ITSELF ESCAPES FROM FRACKING. IT’S A BYPRODUCT, AND IT LEAKS FROM PIPES. THERE ARE PLACES IN THE PERMEAN BASIN WHERE THEY BURN IT OFF. AND NATURAL GAS IS NEAR $2, AND THERE IS NOT A LOT OF ECONOMIC INCENTIVE TO CAPTURE IT RIGHT NOW, AND AGAIN, THIS IS A DROP IN THE BUCKET PROBLEM BUT I THINK IT’S EMBLEMATIC OF THE TRUMP EPA AND TRUMP AGENDA. >>YOU MENTIONED EXXON MOBILE, AND THEY ARE A SAMPLE OF SAYING, MAYBE THIS IS NOT GOOD FOR US, AND THE BENEFITS, JARED, OF HAVING LOWER COST IT WILL BE COUNTER BALANCED OF THE LEGAL COSTS, THE ENVIRONMENTALISTS THAT WILL BE UPSET BY THIS. >>LET ME SAY THAT ONE PERSON CLOSE TO PRESIDENT TRUMP SUPPORTEDLY SAID WE DON’T NEED REGULATIONS BECAUSE THERE IS AN ECONOMIC INCENTIVE TO RECAPTURE THEY IN THEY WERE THAT WOULD HAVE SOLD OTHERWISE. THEY REPRESENT 11% OF THE NATURAL GAS OUTPUT AND PRODUCTION CAPACITY OF THE U.S. AND I THINK IT’S BECAUSE THEY HAVE ENTRENCHED POSITION AND EXXON IN PARTICULAR IS LOOKING TO GET INTO SHELL OIL IN A BIG WAY BY 2025, AND THIS WOULD CROWD OUT THE SMALLER SHELL PLAYERS WHO ARE RIDING ON HIGH DEBT AND FACING OBSTACLES TO PRODUCTION. >>ALL RIGHT. WE WILL KEEP WATCHING. YOU CAN SEE THE HEADLINES, AND WE MORE INFORMATION ON THE BUSINESS PERSPECTIVE, AND THERE IS ALWAYS MONEY INVOLVED. LET’S TAKE A LOOK AT WHAT STOCKS ARE DOING RIGHT NOW. INES FERRE IS LIVE AT THE NEW YORK STOCK EXCHANGE. >>Reporter: THE DOW IS REALLY MOVING ON THE CHINA HEADLINE, AND THAT’S WHAT MOVES THE MARKETS THESE DAYS, ANY NEWS RELATED TO CHINA. BUT LET ME TELL YOU THAT THE DOW IS UP 270 POINTS AND THE S&P 500 AND NASDAQ ARE HIGHER, AND THE CONSUMER DISCRETIONARY MATERIALS ARE LEADING THE GAINS THIS MORNING, AND WE’RE WATCHING THE BARGAIN OUTLETS. TAKE A LOOK. THE STOCK IS TANKING AFTER THE CEO SAYING IT WAS A TOUGH ANSWER AND THE EARNINGS CAME IN BELOW WHAT THE STREET WAS EXPECTING AND CUT THE FULL YEAR GUIDANCE FOR THE FAST PACE OF STORE OPENINGS, INCLUDING TAKING OVER 30 TOYS R US LOCATIONS, THAT THE INCREASED CANNIBALIZATION AND THE SUPPLY CHAIN PRESSURE. AND DOLLAR TREE AND DOLLAR GENERAL, I WILL HAVE MORE ON THAT FOR YOU COMING UP NEXT. >>THANK YOU, INES. WE’LL CHECK IN WITH YOU SOON. >>THANK YOU. SEE YOU SOON. >>>COMING UP ON THE SHOW, MANY, MANY NEW STORIES ABOUT SURVEILLANCE. APPLE IS ADDRESSING THE SIRI RECORDINGS THAT BECAME SUCH A SCANDAL. MEANWHILE, AMAZON-OWNED RING IS PARTNERING UP WITH LAWMPLET. — LAW ENFORCEMENT. WE WILL HAVE THE DETAILS AFTER THE SHORT BREAK. STICK WITH US. >>>WELCOME BACK TO YFi A.M. ON THE NEWS OUT OF CHINA THAT CHINA WANTS TO APPROACH TRADE STOCKS IN A CALM MANNER, STOCKS ARE MOVING HIGHER. ALL THREE INDICES ARE IN THE GREEN. THE DOW JUST A FEW MINUTES AGO WAS UP HIGHER, AND WE WILL KEEP MONITORING. TIME TO TALK ABOUT AMAZON. DURING THE ONGOING BACK AND FORTH — REMEMBER THIS — WHEN AMAZON WAS MAKING PLANS TO OPEN HQ 2 IN NEW YORK CITY, THEY HAD A BURN BOOK STYLE RECORD OF LABOR LEADERS. IT WAS CALLED NEW YORK NEGATIVE STATEMENTS AND HAD DETAILS ON HOW OPPONENTS OF HQ 2 WERE MOCKING THE PLANNED HELIPAD FOR JEFF BEZOS WITH THE HASHTAG SCAMAZON, AND A BURN BOOK THAT I IMAGINE WAS THE PROBABILITY DECIDING FACTOR IN LEADING AMAZON TO SAY, OKAY. WE GIVE UP AND WAVE THE WHITE FLAG. >>SO THIN SKINNED? I HOPE THAT AMAZON CAN TAKE IT. ONE OF THE BIGGEST COMPANIES IN AMERICA. BUT IT WAS INTERESTING TO SEE THE BURN ON AMAZON AND WHAT PEOPLE PUT IN THERE. AND A UNION LEADER SAYING IT’S COLD OUTSIDE IN NEW YORK BUT NOT AS COLD AS JEFF BEZOS’ HEART, AND ANOTHER POLITICIAN, OH, WE HAVEN’T BEEN ELECTED TO BE AMAZON’S DRONE. SO IT’S ENTERTAINING TO LOOK AT IT ON THE OUTSIDE PERSPECTIVE BUTAMAZON HAS PUSHED BACK SAYING THIS WAS A BRIEFING DOCUMENT FOR EXECUTIVES TO KNOW WHAT THE ENVIRONMENT IS. >>I THINK WE HAVE TO BE CAREFUL OF THE DETERMINATION THIS IS A BURN BOOK, IT’S NOT LIKE AMAZON WOULD BE DOING A HIT JOB — [ LAUGHTER ]. >>THAT WOULD BE ILLEGAL. >>I THINK IF ANYTHING T SHOWS, YES, YOU MIGHT CALL IT THIN SKINNED BUT AMAZON BEING AWARE OF WHAT THE PUBLIC OPTICS LOOK LIKE. A COMPANY AS BIG AS AMAZON WHEN YOU PARACHUTE INTO A COMMUNITY AND YOU BUILD A HUMONGOUS HEADQUARTERS YOU WANT TO BE AWARE OF THE CRITICISM. AND CATALOGING THEM IS PROBABLY A MOVE THAT AMAZON PR WANTED TO DO, SAYING, LOOK. WE KNOW THERE ARE DOWNSIDE RISKTS AS WE GO THROUGH THE SEPARATE BIDDING PROCESS, A SEPARATE, AND I THINK IT WAS RESPONSIBLE THE WAY THEY TRIED TO BID CITIES GENTES EACH OTHER, AND THIS WAS JUST A PART OF IT. >>I THINK THE STORY IS INTERESTING AND JUICY AND FUN, AND IT’S NOT SURPRISING THAT THE COMPANY WOULD KEEP TRACK OF THE STATEMENTS AND THEN LEAD TO A DECISION, AND THE CRITICISM, AFTER ALL THAT YOU BACK OUT? >>WHAT SURPRISED ME IS THEY USED A GOOGLE DOC. >>EXACTLY. WHEN AMAZON SAID WE CAN BRING THOUSANDS OF JOBS, IS THAT TRUE? CAN THEY DELIVER ON THAT? AND THE COST OF REAL ESTATE IN NEW YORK, THEY NEED NO HELP IN RAISING THE COST OF REAL ESTATE. IN THEY MOVED THEIR HEADQUARTERS TO QUEEN, IT WOULD BE EXTREMELY EXPENSIVE. >>>LET’S MOVE ON. EVERY WEEK WE GIVE YOU A PREVIEW OF THE EPISODE OF INFLUENCERS. THIS WEEK, WE SAT DOWN WITH THE CEO FOUNDER OF THE TECH FIRM BETA WORKS AND SMOKE SPOKE ABOUT HOW THE TECH SPEAKERS ARE SELLING WELL BUT ARE PROBLEMATIC. >>I THINK THAT THE SMART SPEAKERS ARE ON ONE HAND AN INCREDIBLE INNOVATION. MY TEAM AND I THINK WE THINK THAT IS NEW AND SAFE. AND YOU CAN GO INTO THE KITCHEN AND GET INFORMATION, AND SMART SPEAKERS AND HEADPHONES, YOU KNOW, SIRI, I CAN SPEAK TO THEM. THAT’S KIND OF COOL. RIGHT? SO I WOULD SAY THAT THE TWO OR THREE PROBLEMATIC LAYERS WOULD BE THE SMART SPEAKERS A EARPHONES IN THE MARKET NOW. THE FIRST IS FROM A CONSUMER STANDPOINT, THE USER STANDPOINT, THAT THESE DEVICES ARE BEING USED FOR WHAT — IT’S HARD TO CALL IT ANYTHING BUT SURVEILLANCE. SO, YOU KNOW, THERE HAVE BEEN INSTANCES OF A SMART TV THAT WAS LISTENING, AND A BUNCH OF AMERICAN CONSUMERS PART THE SMART TV. 11 MILLION SOLD IN THE U.S. AND THEY WERE LISTENING TO THE ACT TEST IN THE ROOM AND USING THAT TO TARGET ADVERTISING. THAT DOESN’T SEEM OKAY. >>AND YOU CAN CATCH THE FULL INTERVIEW WITH JOHN BORTHWICK LATER TODAY. >>>AND SPEAKING OF SURVEILLANCE, THE COMPANY RING, OWNED BY AMAZON AND ENDORSED BY SHAQ WHO WAS ON THE LIVE SHOW YESTERDAY, REPORTEDLY IS WORKING WITH 400 POLICE FORCES ACROSS THE COUNTRY TO GIVE THEM ACCESS TO FOOTAGE WITHIN A SPECIFIC TIME AND AREA, AND THAT’S SURE TO BE CONTROVERSIAL, AND AMAZON WAS WORKING WITH LAW ENFORCEMENT IN SOME STATES FOR THE FACIAL RECOGNITION SOFTWARE. SOMED WITH AN A THERE, SO IT’S LIKE RECAGNITION. REMEMBER THAT? >>OH, YEAH. >>REMEMBER THAT? THE ADL OR SOMEONE WAS AGAINST THAT. >>WHENEVER IT COMES TO A FACIAL RECOGNITION DEVICES, ANYTHING THAT’S FILMING YOU OR RECORDING YOU OR USED IN ANY VIDEO OR AUDIO OF YOU, YOU WANT TO READ THE TERMS AND CONDITIONS. I UNDERSTAND THAT PEOPLE DON’T READ THE TERMS AND CONDITIONS BUT I THINK IN THE AGE WHERE PEOPLE ARE AWARE OF HOW, YOU KNOW, COMPANIES ARE SELLING THIRD PARTY INFORMATION AND I’M NOT TALKING ABOUT THE POLICE ISSUE HERE BUT IN GENERAL, SELLING THE INFORMATION TO OTHER COMPANIES. YOU WILL WANT TO BE AWARE OF WHAT YOU ARE SIGNING UP FOR. >>AND I WANT TO DOUBLE DOWN ON THE POLICE ENFORCEMENT ASPECT. I DON’T HAVE ISSUES OF LAW ENFORCEMENT LOOKING INTO THIS DATA. >>ME, NEITHER. >>IT SEEMS LIKE HYSTERIA. FIRST OF ALL, WHEN YOU ARE WALKING DOWN THE STREET, THERE ARE LENTY OF STREET CAMERAS AND PEOPLE ARE WALKING WITH CELL PHONES AND YOU ARE LIKELY TO BE ON A CAMERA MANY TIMES A DAY BUT IN TERMS OF LAW ENFORCEMENT, NOT TO WORRY. THEY ARE LOOKING WITH VIOLENT CRIMINALS AND PEOPLE WHO SHOULD NOT BE ON THE STREET IN THE FIRST PLACE. >>I AGREE BUT PEOPLE WHO ARE GIVING THE DATA TO SOMEONE ELSE, PEOPLE FEEL THAT’S ICKY AND YOU DON’T LIKE THAT, AND WHEN YOU SAY THE TERMS AND CONDITIONS, FORGET READING THAT. JUST ASSUME THAT SOMEHOW, THE DATA IS GOING SOMEWHERE ELSE, AND IF YOU DON’T LIKE IT, DON’T BUY IT. THAT’S WHAT I SAY ABOUT THE SMART SPEAKERS. IF YOU DON’T LIKE THE IDEA THAT THEY ARE LISTENING, DON’T BUY ONE AND PUT IT IN YOUR HOME. >>AND THE TERMS AND CONDITIONS ARE COMPLICATED AND HARD TO READ AND THEY KNOW THAT. >>THEY KNOW THAT, AND THE BASELINE IS NOT JUST A CLOSED CIRCUIT INFORMATION. IT WILL GO TO SOMEBODY. BUT ANYWAY, APPLE IS APOLOGIZING TO USERS FOR LTTING CONTRACTORS LISTEN TO THEIR SIRI COMMANDS. WITH THE APOLOGY COMES A PROMISE TO CHANGE. APPLE SAID THAT THE CONTRACTORS WERE LISTENING TO COMMANDS TO IMPROVE THE SERVICE. THE YAHOO FINANCE TECH EDITOR IS HERE, AND DAN HOWLEY, WHY DID APPLE APOLOGIZE YESTERDAY? >>THIS IS GOING ON WITH THE BIG TECH COMPANIES WITH THE VOICE SYSTEMS, AMAZON, GOOGLE, FACEBOOK, NOT REALLY EXCITING. [ LAUGHTER ] AND THEN APPLE. WHEN YOU SAY SOMETHING TO THE VOICE SYSTEM, YES, A ROBOT — WE’LL JUST SAY A ROBOT — BUT IT TAKES IN WHAT YOU SAY AND SPITS OUT A RESPONSE. BUT TO TEACH A ROBOT HOW HUMANS SOUND AND WHAT WORDS ARE IT NEEDS TO HEAR HUMAN VOICES. THEY ENSURE THAT THE VOICE IS SAYING WHAT THE ROBOT THINKS IT’S SAYING BY HAVING PEOPLE LISTEN TO IT. AND THAT’S HOW THE KEY ALGORITHMS WORK. AND WITHOUT THE HUMANS, WE WOULD NOT HAVE SIRI, ALEXA, AND GOOGLE ASSISTANT, AND WHATEVER THE FACEBOOK HAD WITH THEIR APP. AND THE SAME THING WITH THE IN- CAR SYSTEMS, AND THAT’S WHY WE SEE SIRI AND ALEXA. THEY ARE SO MUCH BETTER THAN THE IN-CAR SYSTEMS THAT COULD NOT LISTEN TO WHAT YOU SAID, AND YOU COULD SAY IT 18,000 TIMES AND WOULD NOT WORK. NOW, THE ISSUE HERE IS PEOPLE FELT THEY WERE NOT TOLD UP FRONT ENOUGH THAT HUMANS WOULD BE LISTENING TO WHAT THEY WERE SAYING AND APPLE CAME FORWARD AFTER THE SAME THING WITH GOOGLE AND AMAZON AND FACEBOOK AND SAID, LOOK. WE’LL START HAVING HUMANS LISTENING TO THIS. WE WILL CUT OFF THE PROGRAM, AND THEN THEY WILL NOT HAVE HUMANS LISTENING TO THEM. >>I DON’T WANT TO SUGAR COAT IT. THE REASON THAT APPLE IS APOLOGIZING, THEY WERE LISTENING THROUGH SIRI TO THE MOST INTIMATE MOMENTS IN THE HOME, AND IT MAKES SENSE THEY SHOULD NOT BE LISTENING IN. >>I DON’T THINK PEOPLE CARE. >>APPLE CARED ENOUGH TO STOP DOING IT. >>THAT’S VOYEURISM. >>IT’S LISTENERISM. >>WE ARE GETTING THE DICTIONARY PEOPLE ON THAT, AND THAT IS ACCIDENTAL ACTIVATION. TO DO THAT, THEY HAVE TO HEAR WHAT SOMEONE SAID TO TRIGGER THE REACTION THAT THE SYSTEM HAD SO WHAT APPLE IS NOW TO GO IS SAYING EVERYONE IS AUTOMATICALLY OPTED OUT. WHEN YOU SIGN UP, WE’LL NOT HAVE ANYONE LISTEN TO WHAT SEVERE SIRI IS SAYING BUT IF YOU OPT IN, SOMEONE WILL LISTEN TO THE VOICE TO MATCHUP WITH WHAT SIRI NEEDS TO HEAR. I WILL OPT IN. >>DAN HOWLEY IS THE ONLY ONE TO OPT IN. >>I CURSE AT THEM CONSTANTLY BECAUSE THEY DON’T GET MY SONGS RIGHT. SO ALL THEY WILL HEAR IS A STRING OF PROFANITY AND PLAY OLD AVRIL LAVIGNE OR SOMETHING LIKE THAT AS ONE WANTS TO DO. SO I THINK THIS WILL BE AN ONGOING ISSUE. GOOGLE AND AMAZON AND FACEBOOK NEED TO COME FORWARD AND DO SOMETHING SIMILAR AS APPLE. >>AS ABILENE SAID, WHY DO YOU HAVE TO MAKE THINGS SO COMPLICATED? >>EXCELLENT, MIKE. >>THANK YOUMENT. >>>LET’S TAKE A LOOK AT THE COUNTRY’S FISCAL PICTURE. THE FEDERAL DEFICIT THIS YEAR IS PROJECTED TO BE $960 BILLION, AND NEXT YEAR IT JUMPS UP TO 1 TRILLION, BUT THAT’S IF THE U.S. ECONOMY STAYS STRONG AND KEEPS GROWING. THERE IS NO PRECEDENT FOR RUNNING DEFICITS THIS LARGE OUTSIDE OF A RECESSION. IF A RECESSION DOES MATERIALIZE, WILL PRESIDENT TRUMP AND CONGRESS HAVE THE TOOLS THEY NEED TO STIMULATE THE ECONOMY? JPMORGAN SAID WHEN IT COMES TO SIMULATING THE ECONOMY TO OFFSET THE RECESSION THEY DON’T THINK THE FEDERAL DEFICIT WILL HINDER THAT EFFORT BUT AT THE SAME TIME, IT’S ELECTION SEASON. >>THIS IS ONE REASON WHY THE U.S. TREASURY IS ISSUING THE 100-YEAR BOND. GLOBAL VS ARE FLOWING INTO WHAT THEY PERCEIVE TO BE ONE OF THE MOST RELIABLE AND RISK-FREE ASSETS OUT THIS, THE U.S.- GOVERNMENT DEBT. THE 100 YEAR BOND MIGHT DO THAT BUT THE LARGEST QUESTION HERE IS WE NEED TO ACKNOWLEDGE THAT THE U.S. DEFICIT CONTINUES TO GROW. PRESIDENT TRUMP DIDN’T NECESSARILY CAMPAIGN AS PROMINENTLY AS PREVIOUS CANDIDATES HAVE ABOUT TRYING TO GET THE DEFICIT DOWN BUT UNDER HIS ADMINISTRATION THE DEFICIT HAS GONE UP. SO THE NEED TO BALANCE THE BUDGET HAS SIMPLY NOT BEEN ANY PART — EVER SINCE THE ’90s. I THINK WE NEED TO REMEMBER THAT AT THE BASELINE. >>AND FOR SURE, THE PRESSURE ON FED CHAIR POWELL WILL NOT WEIGH ON IT. >>AND TO ME, IT’S ABOUT CLIMATE CHANGE. JUST YESTERDAY, A TWEET FROM DAN RATHER WHO SAID NO ONE WHO IS ALIVE RIGHT NOW WILL LIVE TO SEE THE EFFECTS OF CLIMATE CHANGE MANY, MANY GENERATIONS FROM NOW, BUT THE ACTIONS WILL AFFECT THEM, AND IT’S LIKE OH, WELL, SOMEONE ELSE WILL HAVE TO HANDLE THAT DEBT. >>>AS FEARS CONTINUE TO RISE OVER A POSSIBLE RECESSION T MIGHT SURPRISE TO YOU LEARN THAT WE HAVEN’T FULLY RECOVERED FROM THE 2008 RECESSION. ACCORDING TO A NEW STUDY, THE CONSTRUCTION INDUSTRY IS SHORT 350,000 WORKERS, AND THAT IS A HOLD OVER FROM 2008. THAT’S NOT AS MANY AS THE JOBS LOST IN 2008. THAT TOTAL 1.5 MILLION IN THE CONSTRUCTION INDUSTRY BUT A BIG LACK OF JOBS IN THE SECTOR, AND HERE TO DISCUSS IS YAHOO FINANCE’S ADRIANNA BELMONTE. >>HI. >>HOW DIRE IS THIS FOR THE CONSTRUCTION INDUSTRY? >>THEY LOST 1.5 MILLION JOBS IN THE FINANCIAL CRISIS FINANCIAL AND THEY ARE GAINING IT BACK, AND THERE ARE A NUMBER OF FACTORS HOLDING IT BACK RIGHT NOW. ONE IS THE FACT THAT THERE AN AGING WORKFORCE. THE BABY BOOMERS ARE AGING AND MORE COLLEGE-EDUCATE THE MILLENNIALS, MORE LIKELY TO TAKE THE 9 TO 5 JOB THAN IN CONSTRUCTION WHERE THE HOURS ARE NOT AS CONSISTENT AND THE WAGES. FOR THE CONSTRUCTION WORKER, $36,000 AND IN AN OFFICE SETTING YOU CAN PROBABLY GET A LOT MORE. >>WHAT I FOUND INTERESTING IS THE FACT WITH A SHORTAGE OF CONSTRUCTION WORKERS WHEN YOU WOULD TO REMODEL YOUR HOME IT COSTS MORE BECAUSE THEY DON’T HAVE THE RIGHT SKILLS AND YOU END UP PAYING FOR. >>THAT’S RIGHT. AND IT’S PROBABLY ONE OF THE BIGGEST ECONOMIC IMPACTS THAT WE ARE STILL IN A HOUSING DEFICIT. WE ARE SEEING IT IN OUR EVERY DAY LIVES EVEN IF WE DON’T REALIZE IT AND I WANT TO POINT OUT TWO OTHER FACTORS THAT CAME ACROSS IN MY BRIEFING, AND I FOUND IT REALLY FASCINATING. ONE OF THE REASONS IS IMMIGRATION POLICIES BECAUSE CONSTRUCTION HAS THE HIGHEST NUMBER OF FOREIGN-BORN WORKERS AND WITH ALL OF THAT GOING ON WITH THE LEGAL IMMIGRATION, IT’S HAVING AN IMPACT ON THE INDUSTRY. IT’S SUBTLE BUT IT’S THERE, AND ALWAYS, THE OPIOID CRISIS. I READ A LOT ABOUT THAT, AND I DID RESEARCH ON THE CONSTRUCTION INDUSTRY HIT THE HARDEST. 6 TIMES MORE LIKELY, SO THERE IS SO MUCH GOING ON RIGHT NOW THAT WE DON’T REALIZE FACTOR INTO THIS. >>AND THAT MAKES SENSE IT AFFECTS THE INDUSTRY IN AN OUTSIDE WAY. IF YOU GET HURT ON THE JOB YOU GO TO THE DOCTOR AND THEY ARE PRESCRIBING PAINKILLERS. THAT’S HOW IT HAPPENS. AND WE ARE TALKING ABOUT THE SAME PROBLEM WITH THE TRUCKING COMPANY. THE MILLENNIALS AND ONE GENERATION BELOW US, THEY DON’T WANT TO DO THAT, AND I DON’T KNOW HOW THAT WILL AFFECT US. >>AND YOU KNOW, I ASK SOMEBODY WHO IS THE SOLUTION, SOMEONE FROM THE HOME BUILDER’S SOLUTION WHO IS FAMILIAR WITH THE SHORTAGE. HE SAID THERE IS NO SILVER BULLET YET BUT HE SAID SOME OF THE WAYS TO TRY AND FIX IT IS BY DOING MORE RECRUIT FIELD WORKERS, HIGH-SKILLED LABOR AND INVESTING IN TECHNOLOGY BUT IT’S NOT GOING TO BE A GUARANTEE. >>THANK YOU, ADRIANNA. >>>LET’S TAKE A LOOK AT ONE OF TODAY’S TRENDING COMPANIES, ABERCROMBIE AND FITCH. THEY BEAT ON THE BOTTOM LINE BUT ON THE TOP LINE, A REFER NEW OF $841 MILLION, SHORT OF THE ESTIMATES OF $853 MILLION, AND STOCKS TUMBLED 15% AND THE OUTLOOK IS NEGATIVELY IMPACTED BY MACRO HEADWINDS IN EUROPE AND ASIA AND THE CHINESE TARIFFS. >>IT’S TRUE. >>I THINK CURRENCY IS ALWAYS A WEAK EXCUSE. ANY TIME YOU SEE A COMPANY TRYING TO BLAME CURRENCY ON THE EARNINGS REPORT — >>THE DOLLAR IS STRONG. >>BUT THE TARIFFS. >>IT IS BIG ISSUE IS THE INTERNATIONAL GROWTH FACTOR, A BIGGER PART OF THE PORTFOLIO, AND WE TALK ABOUT NOT JUST THE CHINESE TARIFFS BUT THE GLOBAL SLOW DOWN, AFFECTING COMPANY IN A BIG WAY. >>AND ABERCROMBIE IS DOING WHAT THE OTHER RETAILERS ARE DOING. HOW DO I GET MYSELF OUT OF CHINA? NOT ONLY THE FOR TAT TARIFF WAR, ARE IMPACTED. THE SOURCES WITH CHINA WERE CUT TO 20%. >>THEY TRY AND REDUCE THEIR EXPOSURE. >>ABERCROMBIE, DESPITE THE DISAPPOINTING EARNINGS REPORT HAS DONE REASONABLY WELL IN A COUPLE OF YEARS, AND THEY ARE STILL AROUND AND ALIVE AND KICKING. >>AND THE DISCLAIMER, I USED TO BE A HOLLISTER EMPLOYEE SO — >>WOW. >>OH, REALLY? >>YEAH. >>ABERCROMBIE BRIAN, THE FIRST TO DEFEND IT. THE FIRST. >>>WE HAVE TO MOVE ON AND STOP TALKING ABOUT THE HOLLISTER POLOS FROM MIDDLE SCHOOL. >>>STILL TO COME, HURRICANE DORIAN WILL HAVE AN IMPACT, AND WE WILL TALK WITH OUR FRIENDS FROM THE WEATHER CHANNEL. >>>AND FROM THE BEVERAGE INDUSTRY, A JUICE TRIO. THAT’S AFTER THE SHORT BREAK. >>>WELCOME BACK TO YFi AM HERE AT YAHOO FINANCE. ALL THE MAJOR INDICES IN THE GREEN WITH THE DOW UP 250 POINTS ALTHOUGH WE HAD SEEN IT UP HIGHER EARLIER, AND WE ARE SEEING VERY LOW TRADING VOLUME, AND WE WANT TO BRING IN OUR FRIEND INES FERRE AT THE TO BE MARKET. INES? >>Reporter: THAT’S RIGHT. VERY LOW TRADING VOLUME, AND WE ARE GOING INTO A LONG WEEKEND. NOBODY IS AROUND, AND WE HAVE THE SLOW VOLUME, AND IT LENDS ITSELF TO THE SWING. WE ARE LOOKING AT THE DOW UP 240 POINTS AND TAKING A LOOK AT THE DOW LEADERS THIS MORNING. WE ARE WATCHING CATERPILLER, DOW INC, IBM ALL LEADING THE GAME, AND I WANT TO MENTION RETAILERS THAT ARE REPORTING. AND WE ARE WATCHING 5 BELOW WITH A POP AFTER THEY BEAT ADJUSTMENTED EARNINGS AND THEIR REVENUE CAME IN BELOW FORECASTS FOR THE LATEST QUARTER AND WIDENED THEIR FULL YEAR EARNINGS GUIDANCE BECAUSE OF THE FLUIDITY OF THE TARIFF SITUATION. THEY HAD BEEN TESTING EARLIER THIS YEAR, SAID THEY STARTED TESTING PRICE INCREASES OF ITEMS BETWEEN $1 AND $4. ALSO, DOLLAR TREE, THE STOCK HAS MOVED AROUND A BIT THIS MORNING. RIGHT NOW IT’S AROUND A FLAT EARNINGS BELOW WHAT THE STREET WAS EXPECTING. AND THE SALES UP 2.4% ABOVE WHAT THE STREET WAS EXPECTING, WITH THE TARIFF, MITIGATING THE INCREASES. WE ARE WATCHING BURLINGTON STORES. THE INVESTORS ARE LIKING WHAT THEY SAW. THEY POSTED BETTER THAN EXPECTED SECOND QUARTER RESULTS AND RAISED THE FULL YEAR GUIDANCE INVENTORY GOING INTO THE SECOND QUARTER WAS IN THE RIGHT BAG GORY. >>CATEGORY. >>THANK YOU, INES. >>>HURRICANE DORIAN HAS SIDESWIPED PUERTO RICO BUT IT COULD HIT FLORIDA AS A CATEGORY 3 HURRICANE. THE QUESTION FOR US IS HOW THIS MIGHT AFFECT BUSINESS, AND JOINING US TO DISCUSS IS JONATHAN PORTER WITH ACCUWEATHER, AND JONATHAN, THANK YOU FOR COMING ON. WHAT IS THE LATEST WITH DORIAN YOU ARE SEEING? >>. >>DAN, GOOD MORNING. AND WE ARE WATCHING A VERY SERIOUS SITUATION WE THINK UNFOLDING THROUGH THE NEXT COUPLE DAYS AS DORIAN WILL BE OUT OVER WARM WATER AND FAVORABLE CONDITIONS FOR STRENGTHENING. AS YOU MENTIONED, THE STORMSIDE STORM SIDESWIPED PUERTO RICO AND NOW IT’S INTENSIFYING AND MAKING ITS WAY TOWARDS THE NORTHERN BAHAMAS OVER THE WEEKEND AND TOWARDS FLORIDA AND PARTS OF THE SOUTHEAST COAST HERE AS WE HEAD THROUGH THE EARLY NEXT WEEK. WE THINK THIS WILL BE A MAJOR HURRICANE AND A SIGNIFICANT RISK ACROSS FLORIDA. >>WOW. AND JONATHAN, LET’S TALK A BIT ABOUT HOW BUSINESSES PREPARE. OF COURSE, THE VIRVEG IN OVERREACTING. I KNOW IT’S BETTER TO BE SAFE THAN SORRY BUT IT’S WHEN THE FEARS OF THE HURRICANE’S STRENGTH CAUSES FEARS AND SOMETIMES, IT DOESN’T END UP SO BAD WHICH IS THE BEST RESULT BUT MY FRIEND IN MIAMI SAID HE WAS SEEING PEOPLE ALREADY RUNNING TO THE GROCERY STORE TO STOCK UP. SO WHAT DO BUSINESSES DO TO PREPARE FOR THE WORST CASE SCENARIO? >>THAT’S A GREAT QUESTION AND THE MOST IMPORTANT THING IS NOT TO PANIC WITH MANY OF THE BUSINESS CUSTOMERS THAT WE WORK WITH, AND WE WORK WITH MORE THAN HALF OF THE FORTUNE 500 FIRMS AND THOUSANDS OF OTHERS HERE AT ACCUWEATHER, SEEING THEM TAKE IT VERY SERIOUSLY. THE COMPANIES WITH OPERATIONS IN FLORIDA AND ACROSS PORTIONS OF THE CAROLINA COASTLINE AS WELL THAT ARE CHOSELY MONITORING THIS, AND THEY ARE STARTING TO ACTIVATE THE EMERGENCY ACTION PLAN, THINKING ABOUT WHAT LOCATIONS THEY MAY NEED TO PROTECT INSURING THERE IS NOT A FLOODING RISK AND WHERE THEY MAY NEED TO BE CONCERNED ABOUT FOR EMPLOYEE SAFETY AND LOCATIONS THAT MAY NEED TO CLOSE. IF SO, WHERE AND WHEN, AND ALSO IMPORTANTLY MAKING SURE THAT GENERATORS ARE TOPPED OFF AND THAT THEY’RE TESTED AND WORKING WELL. FINALLY, OTHER COMPANIES ARE THINKING ABOUT WHAT ARE THE CHANGES TO LOGISTICS AND TRANSPORTATION NETWORKS THAT MIGHT BE REQUIRED. THESE ARE THE THINGS THAT BUSINESSES START THINKING ABOUT DAYS IN ADVANCE IN ORDER TO MAKE SURE THAT THEY WILL HAVE ALL THE THINGS THAT THEY WILL NEED IN PLAY AND THEN START TO FINE-TUNE THEIR RESPONSE AS WE GET CLOSER AND CLOSER TO AN IMPACT. AGAIN, WE EXPECT THE IMPACTS TO START OCCURRING IN FLORIDA AS WE HEAD THROUGH THE DAY ON SUNDAY. SO A COUPLE OF DAYS TO PREPARE AND FOR BUSINESSES TO BE READY. >>I WANTED TO QUICKLY TOUCH ON THE RETAIL SECTOR. OBVIOUSLY YOU HAVE THE SEPTEMBER 1 DEADLINE FOR ADDITIONAL TARIFFS. HOW DO YOU THINK THAT WILL IMPACT THE RETAILERS IN FLORIDA? >>WELL, CERTAINLY RETAILERS, IT WILL DEPEND ON THE TYPE OF RETAILER. CERTAINLY, THE FOLKS, THE BIG BOX RETAILERS WILL SELL PRODUCTS AND THEY NEED TO PREPARE, AND THEY HAVE ALREADY BEEN BUSY, AND OTHER RETAILERS CAN BE IMPACTED AS CUSTOMERS WILL NOT BE MOVING AROUND AS OFTEN AND VISITING THE LOCATIONS DURING AND CERTAINLY AFTER THE HURRICANE SO THERE CERTAINLY CAN BE IMPACT. >>JONATHAN PORTER OF ACCUWEATHER, WE APPRECIATE THE UPDATE, AND WE’LL CHECK BACK WITH YOU SOON BECAUSE AS WE MENTIONED, HURRICANE SEASON IS STARTING NOW. WE’LL KEEP IN TOUCH. THANKS. >>SURE. >>>LET’S TAKE A LOOK AT ANOTHER ONE OF TODAY’S TRENDING PICTURES, DOLLAR GENERAL. SHARES ARE SOARING AFTER THEINVESTMENTS EARNINGS ON THURSDAY MORNING WITH THE STOCK ALMOST 9% AND THE DISCOUNT RETAILER SETTLED WITH THE NEW YORK ATTORNEY GENERAL SELLING MOTOR OIL THAT WAS REPORTEDLY NOT USEABLE FOR CAR SALES AFTER 1930. NOT A GOOD LOOK BUT THE STOCK IS NOT OFFERING. >>AND UNFORTUNATELY, IT SORT OF MATCHES MAYBE A STEREOTYPE YOU THINK ABOUT THE STORES, THAT SOME OF THE PRODUCTS SITTING IN THERE ARE SITTING IN THERE FOR YEAR. >>ESPECIALLY THE FOOD. >>I AM NOT SURPRISED TO SEE THAT THE DOLLAR GENERAL IS DOING WELL WHEN YOU COMPARE IT TO ABERCROMBIE AND FITCH. WHEN THERE ARE FEARS OF THE RECESSION, PEOPLE WANT FOOD AND HOUSEHOLD PRODUCTS FOR A LOWER PRICE, AND IT WOULD MAKE SENSE THAT DOLLAR GENERAL IS DOING VERY WELL, AND IN TERMS OF THIS YEAR, THE SHARES ARE UP 30%. >>AND YOU COULD FOCUS ON THE RECESSION FEARS SAYING THAT MAKES SENSE, OR YOU COULD SAY THAT THE WHOLE RECESSION FEAR THING HAS ONLY BEEN HERE A COUPLE OF MONTHS AND FOR THE LAST YEAR OR TWO, THE ECONOMY HAS BEEN VERY HEALTHY SO IN SOME ASPECTS, IT’S SURPRISING >>THEY ARE DOING WELL, BUT MILLIONS OF AMERICANS CANNOT AFFORD A $400 EMERGENCY? >>AND RECESSIONS, PEOPLE HAVING TO BUY EXPIRED FOODS, AND IN SOME CASES, EXPIRED DRUGS ARE PART OF THE SETTLEMENT, NOT JUST AT DOLLAR GENERAL. BUT IT’S NOT GOOD FOR THE AMERICAN CONSUMEER IF THEY HAVE TO GO TO THE EXPIRED FOOD. >>CHECK THE EXPIRATION DATE. >>YEAH, THE MODEL T? >>>THE BEVERAGE INDUSTRY CONTINUES TO GROW EACH YEAR BUT THE GROWTH IS NOT NECESSARILY COMING FROM THE CATEGORIES YOU MIGHT ASSUME. PEPSICO AND COCA-COLA HIGHLIGHTED THE GROWTH IN WATER AND JUICES, AND MANY OTHER BRANDS ARE LOOKING TO DISRUPT THE GIANTS. WE SAT DOWN WITH THE CEO OF ONE OF THOSE BRANDS, DIRTY LEMON, FOR A BREAK-OUT EVENT. SHE HERE NOW. EMILY McCORMICK, TELL US ABOUT THAT COMPANY. I REMEMBER HAVING THEM ON A COUPLE OF YEARS AGO WHEN THEY HAVE JUST STARTING OUT. >>THAT’S RIGHT. THEY HAD JUST CONTINUED THEIR CBD BEVERAGE, AND IT’S A BRAND UNDER THE PARENT COMPANY OF IRIS NOVA, AND THAT’S WHAT ZACH SAID IS TRYING TO BECOME OR COMPETE WITH COCA-COLA IN THE SENSE THAT IT’S TRYING TO BE A MAJOR COMPANY WITH ALL THE PLANS UNDERNEATH IT. AND RIGHT NOW, IT’S DIRTY LEMON, AND THEY ARE INVESTING $100 MILLION IN THE NEXT 3 TO 5 YEARS UNDER THE OTHER COMPANIES IN THE COMPANY AND OUTSIDE AND THEN BRINGING ON TO THE PLATFORM AND TEND TO BUILD THAT OUT BUT ONE OF THE BIG THINGS THAT IS DIFFERENT ABOUT THEM IS THE WAY THEY ARE DOING THE DISTRIBUTION SYSTEM, AND HE DESCRIBED COCA-COLA AND PEPSI AS THE BEAT THE BEAT COMPANY. YOU WANT TO COMPETE WITH COCA- COLA BUT YOU DON’T WANT TO BE THE NEXT COCA-COLA. WHAT IS THAT MAIN DISCREPANCY BETWEEN THE TWO? >>COCA-COLA IS THE BE TO BE BUSINESS. THEY SELL TO THE BOTTLERS AND THE BOTTLER PUT THE BOTTLES THEY PRODUCE ON THE TRUCK, AND THE TRUCKS BRING THE PRODUCT TO STORES. AND THE STORES ARE ACTUALLY THE PART OF THE EQUATION WITH A LOT OF PEOPLE THAT NEED TO TOUCH THAT BOTTLE BEFORE IT GETS TO THE CONSUMER. AND WE HAVE CUT OUT THE MIDDLE MEN AND HAVE A RELATIONSHIP WITH THE CONSUMER. SO THE CUSTOMER PLACES AN ORDER FOR DIRTY LEMON ON THE PHONE, AND THEY TAX — TEXT US AND SAY SEND ME ANOTHER CASE OF RETINOL OR ANOTHER PRODUCT, AND THAT IS FAST ACCESS TO THE PRODUCT, AND WE’RE UTILIZING THE SAME TECHNOLOGY TO THE BRANDS IN THE PORTFOLIO AND POOLING THE CUSTOMERS. IF YOU PURCHASED A DIRTY LEMON PRODUCT BEFORE YOU CAN PLACE AN ORDER FOR THOSE PRODUCTS WITHOUT HAVING TO ENTER IN THE CREDIT CARD INFORMATION AND BILLING INFORMATION. >>I THINK ONE OF THE INTERESTING THINGS THAT ZACH ADD SIDE HE DOESN’T THINK THERE WILL BE BILLION DOLLAR BRANDS FOR THE BRANDS UNDERNEATH THE COMPANY PORTFOLIOS. HE IS TRYING TO BUILD A MULTI- BILLION DOLLAR COMPANY AND KNOWS THAT THE BRANDS WILL BE SMALLER AND WON’T GET TO THE SIZE THAT THE COKE OR PEPSI DID. TIMES ARE CHANGING. >>AND THEY ARE TRYING TO BUILD A COMPANY, BUT SERIOUSLY, DO THEY HAVE TO WATCH THEIR BACK? >>THE FUNDING. >>YEAH. THEY DID GET FUNDING FROM COCA- COLA, AND HE IS CHARGING AN INITIAL PUBLIC OFFERING IN THE NEXT FEW YEARS SENTENCE ONCE THEY HIT $100 MILLION IN REVENUE. >>HE SAID HE IS NOT — YEAH. I DID ASK ABOUT THAT. >>EMILY, THANK YOU SO MUCH. AND CONGRATS ON BREAKOUT. >>THANK YOU. >>>LET’S STICK WITH THE BEVERAGE INDUSTRY AND TALKING ABOUT THE SMALLER BRANDS LOOKING TO DISRUPT THE GIANT TRIO. THE FLAVORED WATER BRAND MADE FROM BIRCH TREES IN VERMONT. THE COMPANY WAS FOUNDED IN 2016 BY THE SON OF THE SNAPPLE CO- FOUNDER. JOINING US IS THE PRESIDENT OF TRIO BRANDS, BRIAN O ‘BURN. WELCOME. >>THANK YOU. >>LET’S TALK ABOUT THIS AND WHY YOU THINK TRIO STANDS APART. SO MANY NEW UPSTART BRANDS, A CROWDED SPACE AND EVERY ONE OF TEM WANTS TO CARVE OUT THEIR OWN NICHE. >>I THINK WHAT WE HAVE DONE IS WE HAVE MANAGED TO CREATE A REALLY GOOD TASTING, FLAVORFUL, LOW CALORIE ALL NATURAL ORGANIC PRODUCT THAT PEOPLE SEEM TO LOVE. AND WE SEE THIS AS A HUGE GROWTH IN BOTTLED WATER WHICH HAS NOW TAKEN OVER. AND YOU HAVE CATEGORYS LIKE KOMBUCHA AND THEY ARE TRYING TO CARVE OUT A BIG PIECE OF THE BEVERAGE PIE. >>WHEN IT COMES TO THE BIG PART OF THE BUSINESS MODEL, IT’S DISTRIBUTION. SO WHEN IT COMES TO YOUR DRINK, DO YOU HAVE A DIRECT TO CONSUMER MODEL? DO YOU DISTRIBUTE TO STORES? >>WHEN WE STARTED, REALLY WE GOT RETAILER ACCEPTANCE AND WE USED BROAD LINER BUT IT’S VERY DIFFICULT TO FIND A BRAND THAT HAS IGNITED THAT HASN’T TURNED TO THIS D SD, DIRECT STORY DELIVERY, AND COKE AND PEPSI AND OTHERS SEEM TO HAVE A GAP IN THEIR PORTFOLIO THAT WE CAN FILL AND THEY HAVE APPROACHED US, KICKING OUR TIRES. >>ALREADY? >>ALREADY. AND THE BEER COMPANIES LIKE BUDWEISER. WE KNOW THAT BEER HAS KIND OF DECLINED SOMEWHAT. BUT THEY ARE NOW TAKING ON OTHER BRANDS THAT ARE WITHIN THEIR NETWORK. >>SO IT’S TRUE THAT YOU ARE PUSHING BEVERAGES THAT ARE HEALTHIER. WHERE DO YOU STAND IN OBESITY? DO YOU THINK THAT SUGARY DRINKS ARE CONTRIBUTING TO OBESITY OF AMERICANS? >>I DON’T THINK THE INDUSTRY HAS DONE A GOOD JOB ON OBESITY. BUT THERE IS NO REASON TODAY FOR PEOPLE TO GET FAT DRINKING SODA WHEN YOU HAVE BRANDS LIKE TREO THAT ARE 10 CALORIES, ONE GRAM OF SUGAR. I THINK YOU MENTIONED, DAN THAT, BOB GOLDEN, THE FOUNDER OF TREO, IS FROM THE FAMILY THAT GAVE US SNAPPLE. BOB WANTED TO GET BACK IN THE BUSINESS BUT WANTED HEALTHIER DRINKS AND CREATED TREO. IT’S ONE OF SUGAR. FOR THE SAME SIZE, COKE OR SNAPPLE, 26 GRAMS. WE ARE 10 CALORIES AND THEY ARE 100 CALORIES. >>WHAT IF IT’S COKE ZERO? >>NO, NO, NO. THAT’S A GOOD OPTION. COKE HAS LAUNCHED 600 PRODUCTS IN THE LAST YEAR, MORE THAN 250, NO SUGAR, LOW SUGAR, AND THEY ARE REALIZING THAT, BUT, YOU KNOW, GETTING BACK TO OBESITY, YOU DON’T HAVE TO GET FAT DRINKING SOFT DRINKS. YOU CAN CHOOSE THE RIGHT ONES. A GOOD ONE. >>AND BRIAN, WHILE WE HAVE YOU WE WANT TO TALK ABOUT THE POSSIBILITY OF AN ACQUISITION. I THINK THE TREND IS WE HAVE ON EXECUTIVES FROM THE UPSTART BRANDS AND WE HAD THE ON THE FOUNDER OF BAI JUICE, AND WE ASKED IF THEY WOULD SELL, AND THEY SAID IT’S CALLED BAI, BUY, NOT SELL, AND A MONTH LATER, THEY SOLD, SO DO YOU THINK THEY WOULD GAIN STEAM AS A CHALLENGER FOR NOW, SEPARATE AND INDEPENDENT? >>YEAH. SO WE ARE — WE ARE TAKING A LONGER TERM LOOK. WE ARE LOOKING AT THE LONG- TERM, AND WE’VE BEEN FORTUNATE BECAUSE WE — YOU KNOW, WHAT YOU ARE LAUNCHING YOUR BRAND, IT’S CHALLENGING AND IT’S RISKY. AND IT REQUIRES A SIGNIFICANT AMOUNT OF TIME TO MAKE A SIGNIFICANT INVESTMENT, AND WE ARE FORTUNATE BECAUSE THE PEOPLE FROM SNAPPLE HAVE BEEN SUPPORTIVE BUT WE WANT TO HAVE PROOF OF CONCEPT. A LOT OF PEOPLE WANT TO INVEST WITH US. WE CHOOSE NOT TO ACCEPT THE INVESTMENT UNTIL WE HAD OF 42 OF CONCEPT. AND SOME OF THE PEOPLE ASKED WHAT IS PROOF OF CONCEPT? IN OUR CASE, WE WERE LAUNCHED FROM STAFF LEONARD THAT’S SELLING 800 TO 1000 BOTTLES PER STORE, AND THAT’S PROOF OF CONCEPT FOR ANYTHING. SO WE ARE ACTUALLY MAKING — LOOKING AT A RAISE. LIKE TWO WEEKS AGO, WE STARTED, AND WE WANT TO TAKE ON THE RIGHT INVESTORS. BUT TO GET BACK TO YOU, WE ARE NOT READY TO SELL. HOWEVER, IF ANYONE COMES AROUND — [ LAUGHTER ]. >>ALL RIGHT. THANK YOU SO MUCH. >> DAN, THANK YOU. >>>COMING UP, WHY DISNEY IS EXPECTED TO HAVE EVEN BIGGER SIGN UP NUMBERS EXPECTED AT LAUNCH THAN EVEN DISNEY EXPECTED. WE’LL BE BACK AFTER A SHORT BREAK. >>>WELCOME BACK TO YFi AM ON YAHOO FINANCE. THE DOW IS INCHING HIGHER, UP 216 POINTS, AND EARLIER IN THE MORNING, THE NASDAQ WAS UP 90, AND THE S&P 500 UP 25 POINTS, AND IT’S TIME TO TALK ABOUT A FAVORITE TOPIC, TESLA BECAUSE TESLA IS GOING BIGGER ON SELLING INSURANCE DIRECT. THAT IS TODAY’S MUST MINUTE. TESLA OWNERS IN THE STATE OF CALIFORNIA CAN NOW, IF THEY WISH, PURCHASE INSURANCE THROUGH THE AUTOMAKER. IN APRIL, TESLA ANNOUNCED THEY WOULD BE ROLLING OUT INSURANCE THAT WOULD SAVE OWNERS AS MUCH AS 30% ON RATES. IT’S UNSURE IF THIS WILL SAVE THE CUSTOMERS ANY MONEY BECAUSE ACCORDING TO THE INSURANCE OF AUTO SAFETY, THE MODEL S IS THE MOST EXPENSIVE CAR TO INSURE. I DON’T KNOW THE TRADE OFF IF YOU HAVE THE MODEL S AND HAVE TESTILY TEST — TESLA INSURANCE. YOU ARE SPENDING MORE FOR THE CAR. >>I WANT TO SAVE ON INSURANCE, WHO DOESN’T BUT TO PROMISE THAT? >>IT COMES DOWN TO TRUST, HOW MUCH DO YOU TRUST IN TESLA TO AM THATTING THAT? >>AND THE PRICING FOR THE INSURANCE, IT’S A TRADE OFF FOR THE INFORMATION, THE INFORMATION ON THE ACCIDENTS THAT TESLAS GET INTO AND THE BEHAVIOR THEY ARE ENCOURAGING AND THE INSURANCE POLICIES ON HOW THEY DRIVE THEM, AND NO ONE HAS BETTER INFORMATION THAN IT ALL. GOOD TO KNOW IN THE PROCESS. >>>AND LET’S TALK ABOUT DISNEY. THEY COULD BE EVEN MORE WILDLY POPULAR AT LAUNCH IN NOVEMBER THAN EVEN DISNEY EXPECTS. UBS SURVEYED 1000 CUSTOMERS AND FOUND 43% TEND TO SUBSCRIBE TO DISNEY PLUS WHAT IT LAUNCHES. DISNEY EXPECTED TO HAVE 30 MILLION SUBSCRIBERS 32034 OR HOUSEHOLDS WITH BROADBAND, AND NOW IT’S 43%. WOW. VERY BULLISH. >>UNDERSTANDABLY SO. I MEAN, THERE ARE TONS OF GREAT CONTENT COMING ON TO THE DISNEY PLUS PLATFORM, AND THEY ARE DOING A LIVE ACTION REMAKE OF “LADY AND THE TRAMP” JUST FOR THAT PLATFORM, AND LIZZIE McGUIRE IS COMING UP, AND SHE WAS 13 AND TRYING TO FIGURE OUT LIFE, AND SHE WILL BE AT HER 30th BIRTHDAY NAVIGATING NEW YORK CITY. >>I THINK THIS IS A PERFECT EXAMPLE OF DISNEY NOT BEING THE FIRST MOVER BUT WATCHING NETFLIX AND UNDERSTANDING THAT THE CONTENT PULLS PEOPLE IN THE SUBSCRIPTION SERVICES NOT JUST THE PRICING. AND IT WAS THE G23 EVENT THAT SHOWED THE CATALOG, AND THE OLDER FOLKS LIKE THOSE WITH STAR WAR. >>VERY DARK AND ADULT >>AND THE PRICE POINT >>AND I’M WITH YOU WITH LIZZIE McGUIRE. IT COULD BE HUGE. THE MILLENNIAL NOSTALGIA. I AM SERIOUS. AND COMING UP, IT’S THE YAHOO FINANCE SUMMIT YOU CAN GO TO YAHOOFINANCEAM.COM FOR MORE. BUT STAY TUNED FOR ON THE MOVE. THAT SHOW STARTS AT 11:00. >>>IT IS 11 AM. THE NASDAQ IS UP 1.25%. A RALLY AMONG APPROVED HOPES AMONG TRADE. TARIFFS ARE TAKING A TOLL ON BUSINESS THOUGH. >>>AND THE SURPRISING EXCHANGE THAT — IS EYEING FOR THE –. OKAY, I AM #GRABYOURWALLETT FOR. LET’S GO TO THE FLOOR AT THE MARKETPLACE. >>>THE DOW IS UP ABOUT 230 POINTS RIGHT NOW. NASDAQ HAS GAINED THE MOST IS WE ARE SEEING TECH KNOWLEDGE HE. THIS IS PRONE TO SO FLUCTUATION. THE PILLARS ARE ALL LEADING ON THE UPSIDE. WE ARE ALSO WATCHING THE SEMIS AND THEY ARE LOOKING GOOD. THE SEMICONDUCTOR STOCK IS UP MORE THAN 2%. AND WTI IS UP ON THE HEELS OF A BIG INVENTORY DROP LAST WEEK IN THE UNITED STATES. WTI IS ALSO SEEING A BOOST AT $56.24 PER BARREL. >>LET’S GET TO OUR TOP STORY. STOCKS ARE TRADING HIGHER AFTER CHINA SAYS IT DOES NOT WANT THE TRADE WAR TO ESCALATE AND THEY ARE WILLING TO MAINTAIN A CALM ATTITUDE WHILE NEGOTIATING. TODAY, WE HAVE ANDY SERWER AND OUR POLICY STRATEGIST GREG VOLL YEAR. WHAT DO WE MAKE OF TODAY’S STATEMENTS FROM CHINA? >>EXCLUDES THE EXCUSE THE CLICHCBUT THE DEVIL IS IN THE DETAILS. WE HAVE BEEN DOWN THIS ROAD BEFORE. AND I THINK THAT THERE IS STILL SO MANY ISSUES THAT HAVE NOT BEEN RESOLVED. SUBSIDIES FROM CHINA, THE THEFT OF U.S. INTELLECTUAL PROPERTY RIGHTS AND ON AND ON. TALKING IS GOOD AND DETAILS ARE BETTER. >>IT SEEMS THAT THE STIGMA TODAY INDICATES THAT CHINA, AT THIS POINT, IS GOING TO COME OUT WITH NEW RETALIATORY TARIFFS. IS THAT A GOOD THING? >>ABSOLUTELY. YOU CANNOT SAY THAT IS BAD. YOU GET THE FEELING THAT EVERYONE, NOT JUST IN THE UNITED STATES BUT EVERYONE WAS UNDER THE SELL OFF. I THINK PEOPLE GOT A WAKE-UP CALL THAT THIS NEEDS TO BE CURTAILED A BIT. >>IS THIS CHINA BLINKING OR DOES IT MATTER? >>I’M NOT SURE THAT IT MATTERS. I’M SURE THAT TRUMP WILL CONTEND THAT THEY BLINKED. IT IS WAY TOO EARLY TO MAKE THAT CALL THOUGH. EVEN THE CHINESE WORRY ABOUT THE IMPACT ON THEIR ECONOMY AND THEIR MARKETS. I DO SEE MAYBE A LITTLE TRUCE BUT THERE ARE SO MANY DETAILS WE NEED TO IRON OUT. >>SO, WITHIN ALL OF THIS, I THINK SOMETHING AMISS IS THE TRADE DEAL WITH JAPAN AND THAN PREVIOUSLY WE HAVE HAD THE TRADE DEAL WITH MEXICO AND CANADA AND BOTH OF THOSE SEEM TO ME LIKE THEY WERE KIND OF NOTHING AFTER A FEW WEEKS. ARE WE GOING TO GET ANY KIND OF –? >>WELL, I THINK THEY GET CONFIRMED BY CONGRESS IN THE NET MONTH OR SO. SO YOU HAVE GOT TO SAY THAT A LOT OF THESE THINGS THAT ARE HAPPY TALK, THERE ARE STILL REALLY TWO REALLY BIG IMPEDIMENTS. FIRST OF ALL, THE FACT THAT THERE IS A LOT OF POTS STIRRING HERE. NUMBER TWO, MAYBE EVEN MORE IMPORTANTLY IS THE THREAT THAT CHINA MAY TRY TO CRUSH THE INSURRECTION IN HONG KONG AND IF THEY DO THAT WILL MAKE GETTING A DEAL THANK YOU FOR. >>WE HAD SOMEBODY SUGGESTING EARLIER THIS WEEK THAT NAVARRO COULD BE A HOLDOVER TO A DEMOCRATIC ADMINISTRATION IF THE DEMOCRATS WIN. HOW LIKELY DO YOU THINK THAT WOULD BE QUITE >>I HAD NOT HEARD THAT. BERNIE SANDERS AND ELIZABETH WARREN PROBABLY AGREE WITH THAT BUT NAVARRO IS VERY DIFFICULT TO DEAL WITH. I THINK IF THE PRESIDENT IS A DEMOCRAT THEY MAY TRY TO GET SOMEONE NEW. BUT AGAIN, I THINK THERE IS NOT A LOT OF DIFFERENCE BETWEEN SANDERS, WARREN AND THE WHITE HOUSE ON A LOT OF TRADE ISSUES. >>AS AN ANALYST AND SOMEBODY WHO LIKES THOSE COCKTAIL PARTIES IN DC, HOW DO YOU PLAY THIS THING? HOW DO YOU PLAY THIS TRADE WAR THAT LOOKS LIKE IT WILL GO ON FOR A WHILE? >>I HATE TO THROW OUT ANOTHER CLICHCBUT I DO THINK THAT FIXED INCOME, GOING TO SAFETY, SAFE HAVEN MAKE SENSE UNTIL WE GET A DEAL. WE STILL HAVE A LOT OF OTHER THINGS TO WORRY ABOUT. NOT JUST HONG KONG. WE NEED TO WORRY ABOUT BREXIT AND THE SINKING ECONOMY IN WESTERN EUROPE. I THINK UNLESS THERE IS A FIRM DEAL, THE PLAY CONTINUES TO BE FIXED INCOME. >>DO YOU THINK IT IS THE TRADE CONVERSATION WHEN YOU GO TO COCKTAIL PARTIES AND SUBSTANTIVE MEETINGS, IS IT THE CONVERSATION THAT IS DOMINATING AT THIS POINT? >>THE QUESTION WE ARE GETTING MORE THAN ANYTHING ELSE IS WHAT HAPPENS TO THE DEMOCRATS IF JOE BIDEN REALLY DOES FADE. WHO IS THE REPLACEMENT? WHO WILL TAKE OVER? I THINK THE CONSENSUS IN THIS TOWN IS THAT WE HAVE A WAYS TO GO BUT TRUMP WILL PULL OUT ALL THE STOPS TO GET REELECTED AND THEN BY THE WINTER WE WILL GET A DEAL. >>AS HE TOLD US AT THE G7 HE DOES NOT CARE ABOUT POLITICS. >>>MEANWHILE, THE EXISTING TERMS ARE ALREADY IMPACTING EARNINGS. TARIFFS ARE IMPACTING MANY BUSINESSES. BUT IN DIFFERENT WAYS INTERESTINGLY. BEST BUY IS TALKING ABOUT THE TARIFFS THAT WILL COME ON ELECTRONICS. WITH THAT WE ARE HEARING SOME OTHER MESSAGES. THE DOLLAR STORE SEEMS TO BE MANAGING IT VERY WELL. THE SENIOR MANAGING DIRECTOR, JOE FELDMAN, COVERS THE RETAILERS. JOE, IS IT A MINUTE MATTER OF EXECUTION AMONG THE RETAILERS WHEN IT COMES TO TARIFFS? OR IS IT A MATTER OF WHICH PRODUCTS THEY ARE SELLING AND BAD FORTUNE? >>IT HAS BEEN INTERESTING. IT DOES SEEM LIKE THE HARD GOODS RETAILERS AND THE DISCOUNTERS LIKE HOME DEPOT AND LOWE’S, WALMART AND TARGET, THEY HAVE DONE A BETTER JOB OF MANAGING THROUGH THIS AND ASSESSING WHAT THE IMPACT IS GOING TO BE ON THEIR BOTTOM LINE. THEY ARE COMMUNICATING THAT WITH WALL STREET AND INCORPORATING THAT INTO THEIR GUIDANCE. BUT OTHER RETAILERS HAVE HAD A DIFFICULT TIME EMBEDDING THAT INTO THE GUIDANCE. IT IS NOT CLEAR IF THAT IS BECAUSE THE SALES TRENDS HAVE BEEN WEAKER BUT THERE DOES SEEM TO BE A DISCONNECT WITH THE TWO HALVES OF RETAIL WITH HARD GOODS VERSUS SOFT GOODS. >>JOE, IF YOU MAKE THE CASE THAT, REGARDLESS OF WHAT HAPPENS IN THIS TRADE WAR, WE WILL NEVER GO BACK TO THE WAY THAT THINGS USED TO BE, WHAT DOES THAT MEAN FOR RETAIL IN TERMS OF SUPPLY CHAIN AND RELYING ON CHINA? >>WELL, THE RETAILERS THEMSELVES HAVE DONE A REALLY GOOD JOB OF MITIGATING THE TARIFF PRESSURE. AND ONE OF THE BIG ASPECTS HAS BEEN MOVING SUPPLY OUTSIDE OF CHINA. IT IS FINDING OTHER RESOURCES AND SHIFTING TO THE SUPPLY CHAIN EFFECTIVENESS. IT COULD HAVE VERY LONG-LASTING IMPACT WHERE WE DON’T SEE THAT RUSH BACK TO CHINA. I THINK WE WILL SEE SOME OF THESE OTHER EMERGING ECONOMIES WILL HAVE A BETTER OPPORTUNITY TO PRODUCE GOODS FOR THE UNITED STATES. >>SO, A COUPLE OF STORIES I HAVE SEEN OVER THE LAST FEW DAYS. NOW I UNDERSTAND THAT THE DOLLAR STORE IS IN TROUBLE FOR NOT HAVING REGULATED GOODS. IS THIS DISRUPTION TO THE SUPPLY CHAIN FROM THE TRADE WAR CREATING PROBLEMS FOR RETAILERS IN MAKING SURE THAT THEY HAVE PROPERLY SOURCED GOODS AND SHOULD CONSUMERS BE CONCERNED ABOUT THIS? >>I THINK WHAT YOU ARE SEEING IS AN EFFORT BY SOME OF THE SELLERS ON AMAZON, WHICH ARE GENERALLY THIRD-PARTY SELLERS, NOT MAJOR RETAILERS IT IS NOT THOSE. AND I THINK THAT YOU HAVE SEEN SOME COUNTERFEIT GOODS OUT THERE AND THAT HAS BEEN AN INCREASING PROBLEM. BUT THE VAST MAJORITY OF THE LARGE PUBLICLY TRADED RETAILERS, THEY ARE ABOVE BOARD AND THEY ARE SELLING GOODS THAT MEET REGULATIONS AND ARE NOT REALLY COUNTERFEIT OR OF POOR QUALITY. I THINK THEY DO A GOOD JOB OF MAKING SURE THERE IS A GOOD VALUE IN PRODUCT BEING PROVIDED. >>I WANT TO ASK YOU ABOUT THE DOLLAR STORES. MEANING DOLLAR GENERAL AND DOLLAR STORE. YOU HAVE BEEN COVERING THIS SECTOR FOR A LONG TIME. HOW COMMON IS IT FOR THEM TO BE DOING CONSISTENTLY WELL DURING A STRONG ECONOMIC PERIOD? YOU THINK OF THEM AS A CONSISTENT PERFORMERS DURING A SLOW GROWTH TIME. >>IT IS REALLY INTERESTING THAT THEY HAVE DONE AS WELL. REALLY, SINCE THE GREAT RECESSION A DECADE AGO, THE DOLLAR STORES AND SHOPPING FOR VALUE HAS BECOME MORE OF A NORM FOR PEOPLE. ESPECIALLY AMONG MILLENNIALS I THINK. THEY SAW THEIR PARENTS GO THROUGH THAT RECESSION AND BECOME MORE FRUGAL AND I THINK THERE IS THIS DESIRE TO GET THE BEST DEAL ON THINGS. IT IS NO LONGER TABOO TO SHOP AT A DISCOUNT OR A WALMART OR A TARGET I THINK PEOPLE NOW SHOP ACROSS THE BOARD AND THEY JUST LOOK FOR VALUE WHERE THEY CAN FIND IT. ESPECIALLY ON CONSUMABLES. THESE ARE GOOD OUTLETS FOR THAT. AND THE WAY THE ECONOMY IS, THE LOWER AND MIDDLE INCOME SHOPPER IS IN BETTER SHAPE. SO WHEN THEY GO TO WALMART OR THE DOLLAR STORE THEY CAN SPEND MORE. >>THANK YOU, JOE FELDMAN. IT WAS GOOD TO TALK TO YOU. >>>RIGHT NOW RAM CO IS CONSIDERING SPLITTING THEIR STOCKS AND THEY ARE LEANING TOWARDS TOKYO. TOKYO MEANS NOT LONDON OR HONG KONG AND NOT NEW YORK. THEY ARE TALKING ABOUT THIS POLITICAL RISK AT THESE PLACES THOUGH. >>I THINK IT STILL HAS TO HAPPEN FIRST. I HEARD ABOUT THIS IPO IN 2000 TEEN. I THINK I WILL BELIEVE IT WHEN IT HAPPENS. >>I THINK ONCE THEY DO THE DOMESTIC LISTING YOU CAN SEE WHAT IS REALLY HAPPENING. BUT I THINK THE DOMESTIC LISTING IS ALSO GOING TO BE OPEN TO EVERYBODY. SO I THINK THEY SHOULD JUST FOCUS ON THE DOMESTIC FIRST. >>THEY HAVE GOT ISSUES. AND YOU CAN TELL BY THE REACTION BY VARIOUS EXCHANGES. THEY HAVE BECOME KIND OF A PARIAH. THEY DON’T MEET THE DISCLOSURE AND I THINK THERE IS SOME ISSUES. THEY ARE CONCERNED ABOUT ANTI- TERRORISM ROLES THAT MAY NOT BE IN THEIR FAVOR AND THERE IS ALSO THAT RISK THEIR SO JAPAN, OKAY, YOU’RE GOING TO DO THIS. BUT THE OTHER THING IS, HOW IS THE STOCK GOING TO BE ANY BETTER THAN THE PRICE OF OIL? WHAT IS IN IT FOR ME TO OWN IT? >>IT IS ALMOST AS THOUGH, I DON’T WANT TO BE A MEMBER OF ANY CLUB THAT WOULD HAVE ME. SO THEY ARE THROWING SHADE ON LONDON AND HONG KONG. BUT, THERE ARE RISK FOR BOTH SAUDI ARABIA AS A NATION AND MOANA AS A COUNTRY. >>I HAVE TRIED TO DO REPORTING IN SAUDI ARABIA. THE OPAQUE NATURE OF THE DISCLOSURE THERE IS VERY DIFFICULT. AND I THINK THAT WILL BE AN ISSUE. DON’T KNOW HOW TASHA GUESS TOKYO STILL REALLY WANTS IT THERE. I AM NOT AN EXPERT ON DISCLOSURE THOUGH. >>WHAT WE WILL CONTINUE TO TRACK IT. COMING UP, STOCKS ARE RALLYING AND THAT GIVES NEW REASON FOR OPTIMISM ON TRIED. AND, WHY TRUMP IS TELLING FARMERS TO GET READY WHEN IT COMES TO AGRICULTURE. >>>ADMITS CONTROVERSY OVER THE BORIS JOHNSON PUSH TOWARDS BREXIT, WE NEED TO LOOK AT THIS. WE’VE GOT MICHAEL GRANT HERE. YOU DON’T HEAR A LOT OF PEOPLE THAT ARE BULLISH ON A HARD BREXIT. WE HEAR LOTS OF FORECASTED DOOM AND GLOOM AND WHAT THAT WILL MEAN FOR THE UK. BUT WHAT ARE THE GOOD PARTS? >>WELL, BRITISH ASSETS ARE THE CHEAPEST RIGHT NOW. MOST OF THE STUDIES SHOW THEY ARE THE MOST UNDERWEIGHT ASSET IN MUCH OF THAT REFLECTS AS THE CONSENSUS ESPECIALLY ON THE AREA OF THAT BUT ACTUALLY KIND, THE EUROPEAN TEST THEY WILL TELL YOU IT IS PART OF TIVOLI THAT DRIVES IT. IT IS THE MIX OF LAWS AND TAXATION EDUCATION AND OPENNESS TO INNOVATION AND SO FORTH. ONE OF THE REASONS THAT THE EUROPEAN UNION IS THE WORST PERFORMING ECONOMIC REGION IN THE WORLD IS BECAUSE IT HAS LOW PRODUCTIVITY DRIVEN BY THE POLICIES OF THE EUROPEAN UNION. SO BREAKING AWAY FROM THAT REGULATION AND TAX POLICY IS LIKE RECEIVING A GET OUT OF JAIL CARD FREE. >>BUT IT IS NOT GOING TO BE SO FREE. SO IN THE MEANTIME, IT DOES SEEM LIKE THERE IS GOING TO BE PRETTY SIGNIFICANT DISRUPTIONS TO TRADE AND THE FLOW OF PEOPLE. >>AND, AFTER FOUR DECADES OF INTEGRATION THERE WILL BE SOME DISINTEGRATION CAUSE THAT WILL BE INCURRED BY BRITAIN AND THE EUROPEAN UNION. BUT THERE IS A LOT OF UPSIDE FOR MANAGING THE ECONOMY ON A PR GROWTH WAY. THAT DOES NOT EXIST WHEN YOU ARE A MEMBER OF THE EUROPEAN UNION. LEADERSHIP WILL STILL MATTER BUT LONGER-TERM THERE IS NO REASON WHY BRITAIN CANNOT SUCCEED. THERE IS A LOT OF ASPECTS TO THE DEBATE THAT ARE CRITICAL BUT I THINK THE UK ECONOMY WILL BE JUST FINE. >>WILL THEY STILL BE HELD TO EUROPEAN STANDARDS AND REGULATIONS, ESPECIALLY FOR THE BRITISH COMPANIES THAT WANT TO DO BUSINESS ON THE CONTINENT. >>PART OF WHAT THEY ARE ARGUING OVER RIGHT NOW IS THIS ISSUE. THE IRISH BACKSTOCK WAS THE POISON CHALICE. AND OBVIOUSLY IT DOES NOT WANT TO DO THAT. SO A BIG PART OF THE FIGHT THAT IS GOING ON IS GETTING RID OF THE IRISH BACKSTOCK AND THAT WILL FREE THEM IN TRADE AND REGULATORY TERMS. WITH RESPECT TO TRADE, OBVIOUSLY, THE UK RUNS A SIGNIFICANT TRADE DEFICIT WITH EUROPE. ONE OF THE THINGS THAT ECONOMISTS DO NOT TELL YOU THAT IN A TRADE WAR OR A TRADE CONFLICT, THE COUNTRIES THAT ARE THE MOST VULNERABLE ARE THE ONES THAT HAVE SURPLUS AND NOT DEFICIT. IF YOU RUN A DEFICIT WITH A FAIRLY DIVERSIFIED DOMESTIC ECONOMY, WHICH IS THE CASE WITH THE U.S. AND CHINA AND THAT IS THE CASE WITH BRITAIN AND EUROPE, YOU CAN ACTUALLY DO JUST FINE. >>SO MICHAEL, I UNDERSTAND THIS POINT THAT YOU ARE MAKING. IT IS CHEAP COMPARED TO EVERY OTHER EQUITY IN THE WORLD BUT HOW DO YOU KNOW IT IS NOT A VALUE TRAP? >>WILL FIRST COME LET’S BE CLEAR. IT IS VERY CHEAP. THE MARKET IN THE UK RUNS ABOUT 6%. BUT THE KEY IS THE DOMESTIC UK ECONOMY AND CAN THEY DO WELL AFTER BREXIT. AND OUR VIEW IS IT CAN WITH THE RIGHT POLICIES. SO IN TERMS OF DOMESTIC UK GROWTH, ONCE WE GET BEYOND THE UNCERTAINTY THAT HAS BEEN DOGGING THE ECONOMY I THINK IT WOULD BE NATURAL TO EXPECT SOME SORT OF IMPROVED GROWTH PROSPECT. MIKE THANK YOU, SO MUCH, MICHAEL. WE WILL GET TO THE OTHER PARTS OF YOUR PORTFOLIO NEXT TIME. SO LET’S MOVE ON TO THIS. THE TRUMP ADMINISTRATION IS MAKING CLAIMS TO AND OBAMA ERA METHANE REGULATIONS. JOINING US ON THE PHONE IS ERIC FROM UPSTREAM. THEY ARE THE PRODUCTION PART OF THE OIL CHAIN IF YOU WILL. SO ERIC, WHEN YOU YOU ARE LOOKING AT THE ROLLBACK OF THE METHANE REGULATIONS THERE ARE SOME COMPANIES THAT THEY STILL WANT THE REGULATION. THEY THINK IT IS A GOOD THING. WHAT IS THE POSITION OF THE API? >>I THINK IT IS IMPORTANT TO CHARACTERIZE WHAT IS ACTUALLY HAPPENING. IT HAS BEEN MISCHARACTERIZED BECAUSE THE RULES THAT ARE IN PLACE REMAIN INTACT. THEY HAVE TO REDUCE EMISSIONS FROM THEIR STORAGE TANKS AND CHANGE OUT THE VALVES. ALL OF THAT REMAINS IN PLACE. THESE REQUIREMENTS THAT I AM TALKING ABOUT FOR NEW AND MODIFIED SERVICES. THEY DEBATE THAT YOU ARE SEEING IS REALLY ABOUT WHETHER OR NOT EPA SHOULD REGULATE METHANE AS A POLLUTANT WHICH THEN COULD TRIGGER REGULATION OVER EXISTING SERVICES LIKE SMALL BUSINESSES. AND MOM-AND-POP. WE HAVE BEEN FULLY ALIGNED AT API IN SUPPORT OF THESE REGULATIONS FOR NEW AND MODIFIED SOURCES BECAUSE IT IS AN EFFECTIVE WAY TO ADDRESS THE MISSIONS OVER TIME. >>SO WHAT ARE YOU NOT IN FAVOR OF THEN? I’M A LITTLE CONFUSED? >>THE CONCERN HAS BEEN OVER THE EPA FAILURE TO FOLLOW STATUTES. WHEN THEY DO THAT BY GOING AFTER VOCS THEY HAVE THE CO-BENEFIT OF CATCHING METHANE. SO IT IS A VERY TECHNICAL SITUATION WE ARE TALKING ABOUT. WHAT THEY DID IN 2016 AS THEY ADDED METHANE AS A POLLUTANT. SO THAT REQUIRES THEM TO COMPLETE A SIGNIFICANT CONTRIBUTION FINDING. THEY HAVE TO LOOK AT DATA AND MAKE DETERMINATIONS AND THEY NEVER DID THAT. THEY FAILED TO FOLLOW THE LETTER OF THE LAW. THAT IS WHAT WE ARE GOING TO SEE TODAY. WE ARE GOING TO SEE A PROPOSAL THAT LOOKS AT WHETHER OR NOT THEY SHOULD ACTUALLY REGULATE METHANE AS A POLLUTANT. BECAUSE THEY HAVE NOT DONE THAT IN THE PAST. SO, AT THE SAME TIME, THE MAIN POINT WE NEED TO KEEP IN MIND IS THESE REGULATORY REGULATORY REQUIREMENTS ARE STILL IMPORTANT. >>BUT ERIC, ISN’T IT THE CASE THAT THIS IS A ROLLBACK OF SORTS AND THIS WILL CONTRIBUTE TO MORE METHANE BEING RELEASED IN THE ATMOSPHERE AND THAT IS HARMFUL TO THE PLANET? >>THERE IS NOT DATA THAT WILL SUPPORT THAT. THIS WILL BE THE SOLUTION TO THE METHANE QUESTION. THE SOLUTION TO THE METHANE QUESTION IS BEHIND INNOVATION AND TECHNOLOGY THAT HAS BEEN ADVANCING AND THAT THE EPA HAS BEEN ADOPTING IN ITS REGULATIONS. SO LIKE WHEN YOU GO OUT AND LOOK FOR LEAKS, THAT IS WHAT THE INDUSTRY IS DOING THROUGH THE REGULATIONS THAT ARE IN PLACE AND WILL CONTINUE TO BE IN PLACE. THEY WILL CAPTURE ALL PRODUCTION ON A VOLUNTARY BASIS AND WITH REGARD TO SAFE REGULATIONS. SO WE CAN’T GET LOST IN A MISCHARACTERIZATION. >>I THINK WE ARE TOTALLY LOST. THIS HAS BECOME MORE MURKY THAN CLEAR. YOU HAVE MEMBERS OF THE API WHO DON’T WANT THE ADMINISTRATION TO BE DOING THIS ROLLBACK OR HOWEVER YOU WOULD LIKE TO CHARACTERIZE IT. THEY ARE CLEARLY AGAINST IT. SO I AM JUST A LITTLE BIT CONFUSED ABOUT THIS. AND THE OTHER ISSUE IS, THE INDUSTRY IS SEEING AN INCONSISTENT PATH FORWARD BECAUSE OF CHANGES. SO MEMBERS LIKE EXXON AND BP FOR EXAMPLE HAVE SAID THAT THEY HAVE A PLAN IN PLACE. WE HAVE SWITCHED OVER OUR TECHNOLOGY WE HAVE MADE THE CHANGES AND NOW YOU WANT TO CHANGE THEM AGAIN? >>WE ARE IN THE SAME POSITION. WE HAVE REQUIREMENTS IN PLACE FOR LEAK DETECTION REPAIR AND THEY ARE DOING IT. AND WE HAVE BEEN DOING IT SINCE 2016. THIS IS ALL IN PLACE. NOTHING RIGHT NOW IS IN THE REGULATIONS FOR THE OLD WELLS. BUT WHAT WE ARE TRYING TO DO FROM THE LEGAL STANDPOINT IS MAKE SURE THAT THE AGENCY IS DOING ITS HOMEWORK BEFORE IT TAKES A STEP TOWARDS EXISTING WELLS BECAUSE THAT SOMETHING THEY DID NOT DO IN THE PAST. THIS IS REALLY A LEGAL STATUTORY QUESTION THAT IS BEING ADDRESSED. IT IS NOT ABOUT WHETHER OR NOT THERE IS GOING TO BE LESS REQUIREMENTS ON THE INDUSTRY. >>OKAY ERIC, FROM AMERICAN PETROLEUM INSTITUTE, THANK YOU. >>COMING UP, NEW RULES BY JUUL TO REGULATE VAPING. >>>IT IS 11:30 AM HERE IN NEW YORK CITY. WE ARE TWO HOURS INTO THE TRADING DAY. STOCKS ARE PUSHING. LET’S SEE IF THE RISK EXTENDS TO OIL PRICES. IT IS PUSHING UP BY 1%. RIGHT NOW, BOJO BACKLASH. JUST DAYS BEFORE A NEW ROUND OF TARIFFS ARE SET TO HIT. >>>AND BE CAREFUL WHAT YOU BRING FROM A GALAXY FAR FAR AWAY. A SOUVENIR FROM STAR WARS GALAXIES EDGE HAS BEEN BANNED. SO, OUTRAGEOUS CONTINUING TO GROW AGAINST THE UK PRIME MINISTER BORIS JOHNSON TO SUSPEND BREXIT. MORE THAN 1 MILLION PEOPLE HAVE SIGNED A PETITION TO STOP IT FROM HAPPENING. BELLINGER SAYS THEY ARE TRYING TO STOP IT BUT WILL THEY BE ABLE TO CLOCK >>THAT IS THE ONE MILLION- DOLLAR QUESTION. A PETTY DIG TATER AND A MAN USING UNDEMOCRATIC TACTICS THEY SET A DANGEROUS PRECEDENT. THOSE AREN’T EVEN THE WORDS OF THE POLITICAL OPPOSITION. THAT IS HOW LEADING MEMBERS OF HIS POLICY ARE DESCRIBING HIS PLANS. IT IS ALMOST 1.5 MILLION SIGNATURES ON THAT PETITION RIGHT NOW. A SURVEY SHOWS AROUND HALF THE PUBLIC THINK IT IS UNACCEPTABLE. SO THE TIME NOW IS VERY LIMITED FOR ANY KIND OF RESISTANCE. IT IS WORTH SAYING FINALLY THAT THIS CERTAINLY DOES FEEL LIKE THE BIGGEST POLITICAL CRISIS OF MY LIFETIME. AND IT IS HARD TO OVERSTATE JUST HOW DEEPLY DIVIDED BRITAIN ALREADY IS BECAUSE OF BREXIT. BUT THIS CONTROVERSIAL MOVE, WHICH COULD BE A PRECURSOR TO AN ELECTION IS ONLY GOING TO INFLAME THOSE TENSIONS. >>IT LOOKS THAT WAY FROM OVER HERE AS WELL BUT THERE IS ANOTHER BIG MEDICAL STORY THAT YOU ARE FOLLOWING AS WELL. THE NEW GOVERNMENT THAT IS TAKING SHAPE IN ITALY. TELL US ABOUT THAT. >>THERE ARE HOPES THAT THE THREE-WEEK POLITICAL CRISIS IN ITALY COULD BE COMING TO A PRETTY QUICK AND BECAUSE THE PRESIDENT HAS JUST GIVEN TWO PARTIES PERMISSION TO FORM A NEW GOVERNMENT. THE MARKET REACTED FAIRLY POSITIVELY SO FAR. THE ITALIAN MAIN INDEX IS UP 2%. WHAT THIS BOILS DOWN TO IS A CRISIS THAT STARTED WHEN THE LEADER OF THE FAR RIGHT LEAGUE PARTY WALKED OUT OF THE PREVIOUS COALITION WITH THE ANTIESTABLISHMENT GROUP BUT IT SEEMS TO HAVE BACKFIRED BECAUSE THEY HAVE MANAGED TO PULL TOGETHER THIS NEW COALITION WITH THE LEFT DEMOCRATIC PARTY. IT IS NOT OVER THE LINE YET BUT IT IS A WAY TO GO IN TERMS OF IRONING OUT POLICY DIFFERENCES AND AGREEING TO A LIST OF CABINET POSTS AND WHO GETS WHAT IN TERMS OF THOSE TOP JOBS. >>TOM, THANK YOU SO MUCH. NOW LET’S GO BACK TO POLICY ISSUES IN THE UNITED STATES. TRUMP HAS TRADE AND FARMERS ON HIS MIND THIS MORNING. IN A FOX NEWS INTERVIEW THIS úM VICIOUS GAME AND THEY HAVE BEEN TARGETING OUR FARMERS. HE SAYS THAT FARMERS ARE WITH HIM ALL THE WAY. HOPE, IT IS GOOD TO SEE YOU AGAIN. I THINK WE CHECKED IN WITH YOU ABOUT A MONTH AND A HALF AGO. I AM CURIOUS HOW THE SUMMER HAS PROGRESSED FOR YOU AND SOME OF YOUR COLLEAGUES IN THE FARMING COMMUNITY. >>ACTUALLY IT HAS BEEN SEVEN MONTHS SINCE WE SPOKE AND IT HAS BEEN A TUMULTUOUS SEVERAL MONTHS NOW. IT SEEMS LIKE THE PRESIDENT HAS A WHIM EVERY NOW AND THEN AND THROW SOMETHING IN THAT MESSES UP THE MARKET. THERE IS SO MUCH INCONSISTENCY AND VOLATILITY IN THE MARKETS ANY WAY. BUT LIKE MANY SMALL BUSINESSES THERE ARE SO MANY THINGS THAT WE CAN’T CONTROL LIKE THE WEATHER AND THE NORMAL COMMODITY MARKETS BUT WITH HIS IMPETUOUS NOTICE IT MAKES IT MUCH MUCH MORE VOLATILE. >>HOW MUCH SUPPORT DOES THE PRESIDENT HAVE IN YOUR AREA AND HAS IT CHANGED AT ALL OVER THE LAST SEVEN MONTHS? >>I WOULD SAY THAT MORE PEOPLE ARE NOTICING THE IMPACT THAT THE TRADE WAR IS HAVING BUT, I WOULD THINK THAT SUPPORT IS WANING IN SOME WAYS BUT WE DON’T HAVE A LOT OF OTHER OPTIONS. SO WE ARE JUST HAVING TO DEAL WITH IT. >>I THINK A LOT OF PEOPLE DON’T UNDERSTAND HOW THE FERMI MARKET WORKS. IF THE TRADE WAR ENDS TOMORROW DO YOU GET YOUR CUSTOMERS BACK TOMORROW? OR COULD THERE BE LONG-TERM DAMAGE? >>I THINK THERE WILL BE LONG- TERM DAMAGE FOR SOME COMMODITIES. OUR INDUSTRIES HAVE BEEN WORKING TO ESTABLISH MARKETS AROUND THE WORLD AND IN MANY WAYS THEY HAVE ESTABLISHED WONDERFUL MARKETS BUT THIS TRADE WAR HAD TO FIND OTHER PLACES TO FIND WHAT THEY NEEDED. AND SO THEY ARE SAYING THAT WE ARE NOT THE ONLY OPTION. I HOPE THAT THE COMMODIIES THAT I AM INVOLVED IN WILL REGAIN THEIR MARKETS BUT NOBODY REALLY KNOWS UNTIL IT HAPPENS. >>HOPE, OF THE CATTLE AND THE WHEAT THAT YOU PRODUCE, HOW MUCH IS SOLD DIRECTLY TO CHINA? OR DO YOU SELL TO A MIDDLEMAN WHO THEN SELLS TO CHINA? AND HOW MUCH OF THAT HAS GONE AWAY? >>WELL WE DON’T KNOW SPECIFICALLY WHERE ANYTHING THAT WE SELL GOES BECAUSE IN THE CATTLE MARKET WE ARE IN THE MIDDLE PART OF THE MARKET. THE PROCESSORS SELL MEAT ALL OVER THE UNITED STATES AND WORLD . SO IT IS LIKELY THAT CERTAIN PARTS OF SOME OF OUR CATTLE MAY HAVE BEEN GOING TO CHINA BUT THE CHINESE MARKET JUST RECENTLY OPENED UP TO AMERICAN BEEF AND WE HAD NOT, VERY GOOD MARKET THERE YET. I HOPE THAT WILL CHANGE ONCE THIS IS ALL OVER WITH AND WE WILL GET A LARGER SHARE OF THEIR MARKET. WITH WHEAT, THE SAME THING HAPPENS. IT GOES TO OUR LOCAL ELEVATOR AND THEN OTHER COMPANIES PURCHASE IT. WE DON’T NECESSARILY KNOW WHERE IT GOES. >>RIGHT. SO I GUESS, ARE YOU SEEING THAT THE PROCESSORS FOR THE GRAIN ELEVATORS IN THE DIFFERENT MARKETS, ARE THEY NOT BUYING IS MUCH FROM YOU? OR HAVE PRICES FALLEN? OR BOTH? >>THE PRICES HAVE FALLEN. ON CATTLE WE SEE, WE GENERALLY TAKE OUR CATTLE TO A SALE BARN ON A SUNDAY AND THE AUCTION IS NOT UNTIL WEDNESDAY. AND THE TWO DAYS IN BETWEEN THERE, IF TRUMP TWEETS SOMETHING NEGATIVE ABOUT THE MARKET OR PUT OTHER TERRORISTS OUT THERE, THE MARKET CAN NOSEDIVE LIKE CRAZY IN THOSE TWO DAYS. IT CAUSES A LOT OF STRESS IN OUR WORLD. >>WELL, WE ARE THINKING ABOUT YOU HOPE. THANK YOU. HOPE IS A CATTLE AND WHEAT FARMER FROM OKLAHOMA. WE APPRECIATE YOUR TIME. >>>COMING UP, FLORIDA BRACES FOR HURRICANE DORIAN AS IT GAINS STRENGTH OVER THE ATLANTIC. AND HOW A NEW POLICY ON CITIZENSHIP COULD IMPACT POLICIES OVERSEAS. >>>HURRICANE DORIAN IS STRENGTHENING AS IT APPROACHES FLORIDA. IT IS NOT EXPECTED TO BE A CATEGORY 4 STRENGTH BY TIME IT IS PREDICTED TO MAKE LANDFALL. PUERTO RICO AVOIDED A DIRECT HIT BUT IT DID CAUSE DAMAGE IN THE U.S. VIRGIN ISLANDS. KIRSTEN GILLIBRAND HAS DROPPED OUT OF THE RACE FOR PRESIDENT. 10 CANDIDATES WILL PARTICIPATE IN THE NEXT DEMOCRATIC DEBATE. THE DEMOCRATIC NATIONAL COMMITTEE CRITERIA WINS 2% SUPPORT AND IT IN AT LEAST FOUR QUALIFYING POLLS. >>>CHILDREN OF — IT IMPACTS MEMBERS WHO ARE NOT YET U.S. CITIZENS AND IT WILL IMPACT A SMALL NUMBER OF PEOPLE. THIS SPARKS CONDEMNATION INCLUDING FROM THE PRESIDENT OF THE FOREIGN SERVICE ADMINISTRATION. >>>COLLECTIBLE BOTTLES FROM THE GALAXIES EDGE ATTRACTION AT DISNEY WORLD IS DESIGNED TO LOOK LIKE A DETONATOR. BUT THE NTSB HAS BANNED THE BOTTLES SAYING THEY LOOK LIKE EXPLOSIVE REPLICAS. >>>IS TRUMP GOOD FOR BUSINESS? THAT IS A QUESTION TACKLED IN THE UPCOMING EPISODE OF –. WITH A CHANCE TO SIT DOWN WITH THE CEO TO TALK ABOUT THAT. >>JOHN BORTHWICK IS A LEADING VENTURE CAPITALIST. HIS COMPANY, BETA WORKS, HAS BACKED A LOT OF IMPORTANT TECHNOLOGY COMPANIES IN NEW YORK AND THROUGHOUT THE COUNTRY. JOHN BORTHWICK AND OTHER BUSINESS LEADERS ARE CONCERNED ABOUT TRUMP TO ONE DEGREE OR ANOTHER. SOME ARE CONCERNED ABOUT HIS TWEETS AND OTHERS ABOUT HIS ECONOMIC POLICIES AND DIVISIVENESS. JOHN BORTHWICK HAS STRONG OPINIONS. TAKE A LISTEN AT WHAT HE HAS TO SAY. >>IS TRUMP GOOD FOR BUSINESS? >>HE SAYS HE IS BUT JUST POINTS TO THE SCOREBOARD. LOOK AT THE STOCK MARKET AND EMPLOYMENT. YOU MUST BE. >>I THINK THAT TRUMP, I.E. DIDN’T AND I WOULD NOT VOTE FOR HIM. I DON’T THINK HE IS GOOD FOR OUR COUNTRY. I THINK HE IS A PRODUCT OF THE DISLOCATION THAT WE ARE GOING THROUGH. AND THAT IS THAT SO MANY LEVELS. HE IS A PRODUCT OF THE FINANCIAL CRASH HE IS ALSO A PRODUCT OF THE MEDIA SYSTEM THAT WE HAVE CREATED AND THAT HE HAS HELPED CREATE. SO HE IS NOT ONLY HOLD AND BUT HE’S IN THERE HIMSELF. SO IS HE GOOD FOR BUSINESS? I THINK THE INCREASE STARTED BEFORE HIM AND IT WILL AND BECAUSE CYCLES DO. I THINK HIS UNPREDICTABILITY IS NOT GOOD FOR BUSINESS. >>WE ARE NEVER REALLY GOING TO KNOW UNTIL 10 YEARS OUT. WHEN THIS WHOLE THING ENDS IN THE CYCLE ENDS. AND THEN HISTORY WILL JUDGE IF TRUMP WAS GOOD FOR BUSINESS. PEOPLE ARE STILL DEBATING WHETHER OR NOT FDR ENDED THE GREAT DEPRESSION. SO, YOU ARE AN ECONOMIST. WHAT YOU THINK? HOW CAN YOU JUDGE? >>I THINK YOU CAN JUDGE BY LOOKING AT CERTAIN METRICS. IF YOU LOOK AT GDP GROWTH, IT PEAKED SECOND 1:45 THOUSAND 18. THEY KILLED THE TAX CUT WITH TRADE POLICY. THEY MURDERED IT. >>I LIKE THAT WAY OF PUTTING IT. >>WILL WE WILL WAIT FOR YOUR ANALYSIS. BUT, DON’T FORGET. YOU CAN CHECK OUT THE ENTIRE INTERVIEW WITH ANTHONY TONIGHT AT 5:00 P.M. EASTERN AND THEN YOU CAN WATCH IT WHENEVER YOU WANT. THE BECAUSE THAT IS HOW THE INTERNET WORKS. >>E-CIGARETTE JUUL IS TRYING TO PUT A STOP TO USE VAPING. ALEXIS KEENAN JOINS US WITH MORE. HOW IS THIS GOING TO WORK? >>Reporter: JUUL IS A THEY WILL GIVE $1 MILLION IN FINANCIAL INCENTIVES AND SUPPORT TO THE RETAILERS THAT CARRY THEIR E-CIGARETTE DEVICES. THEY SAY THAT THESE NEW REQUIREMENTS WILL MAKE THE POINT OF SALE TRANSACTION REQUIRE AN IID SCAN AND IT WILL LIMIT THE QUANTITY OF THE DEVICES AND REFILL CARTRIDGES THAT CAN BE PURCHASED. RETAILERS WHO FAIL TO IMPLEMENT THIS BY MAY 2021 WILL NO LONGER BE ALLOWED TO SELL THEIR PRODUCTS AT ALL. THE COMPANY ALSO SAYS THAT IT IS PLANNING PLANNING TO NATIONALLY RULE OUT A TRACKING PROGRAM THAT WILL ALLOW THE DEVICES THAT THEY SELL TO BE TRACKED BACK AND TRACED TO THE POINT-OF-SALE LOCATIONS SO THEY WILL KNOW THE RETAILER THAT SOLD THAT DEVICE AND THEY WILL KNOW IF IT HAS BEEN CONFISCATED FROM A MINOR. RIGHT NOW THE CURRENT REGULATIONS REQUIRE SALES OF THE E-CIGARETTE TO GO TO PEOPLE THAT ARE 18 YEARS OLD AND OLDER AND A PHOTO ID IS REQUIRED FOR ANYONE WHO IS UNDER 27 YEARS OLD. THAT PUTS ONUS ON THE RETAILER TO MAKE THAT HAPPEN. WHEREAS IT TOOL IS SAYING THAT THIS NEW SOFTWARE THEY WANT TO ROLL OUT WILL NO LONGER PUT THAT JUDGMENT IN THE HANDS OF THE RETAILER AND THE STORE WHO IS SELLING THE DEVICES. JUST TO GIVE YOU AN IDEA OF HOW PROBLEMATIC THE TEENAGE USE OF THESE PRODUCTS IS, JUST IN THE UNITED STATES, ACCORDING TO THE FDA IN 2018, MIDDLE SCHOOL AND HIGH SCHOOL AGE STUDENTS TOTALED 3.62 MILLION. HIGH SCHOOL USE WAS UP BY 78% YEAR OVER YEAR. MIDDLE SCHOOL USE IS UP 48%. AND THE WALL STREET JOURNAL REPORTS THAT THROUGH JUNE OF THIS YEAR THAT THE COMPANY SOLD 12 MILLION E-CIGARETTE DEVICES THAT CONTRIBUTED TO $1.27 BILLION IN REVENUE. >>WELL WE WILL SEE IF THIS WORKS. THANK YOU, ALEXIS. >>>COMING UP, RETAIL REAL ESTATE STALLS DESPITE FALLING MORTGAGE RATES. >>>AND LET’S TAKE A LOOK AT THE BIGGEST DEALS IN THE DOW TODAY. J.P. MORGAN THERE IS WRAPPING UP THE BANKS. >>>WE HAVE SOME TRENDING TICKERS FOR YOU FROM THE TICKER. THE FIRST IS — THAT CAME OUT WITH ESTIMATES AND REVENUE. SOFTWARE AND SUPPORT BILLINGS ARE UP 20%. THE SHARES ARE 30% TODAY BUT THIS DOWN HERE SHOWS YOU THE 52- WEEK RANGE. IT IS STILL CLOSER TO THE LOW THAN THE HIGH AT THIS POINT. YOU CAN SEE IT IS DOWN EVEN EVEN WITH THE 30% GAIN. SO, LET’S FLIP BACK TO TODAY AND TAKE A LOOK AT ALL THESE BARGAIN OUTLET. THIS IS ONE THAT IS IN THE NEGATIVE COLUMN. IT HAS AN EARNINGS SHARE OF 35 SENT HER PIECE AND THAT IS $.10 BELOW. ARLINGTON STORES, THEY ALL HAVE DIFFERENT STEELS IN RETAIL. THOUGH SHARES ARE UP BY 18% AFTER ESTIMATES OF SALES ROSE BY 3.8%. SO WE ARE SEEING A LOT OF DIFFERENTIATION IN THE RETAIL WORLD TODAY. WE ARE ALSO WATCHING THE MARKETS OVERALL ON THE RISE. THERE IS A RISE BECAUSE OF THE RECESSION. THE NASDAQ IS NOW 1.5% AND THE S&P IS UP 1.3%. IT IS TIME FOR WORD ON THE STREET. WE ARE KEEPING AN EYE ON THE HOUSING MARKET. BUT HOMEOWNERS ARE NOT REFINANCING? >>THAT’S RIGHT. THERE ARE MANY THAT COULD REFINANCE BUT THEY ARE NOT DOING IT. RIGHT NOW IT IS UP TO $6.3 TRILLION. >>WHY AREN’T THEY? >>I THINK THE PEOPLE WITH THE EQUITY PROBABLY DON’T NEED TO ACCESS THE EQUITY. IT IS ONE OF THESE THINGS WHERE , WHERE THE MONEY IS, PEOPLE DON’T NECESSARILY NEED TO BE SPENDING OR BORROWIN WHERE THE MONEY IS NOT >>DOES THAT SUGGEST THAT IF THERE IS ANY ECONOMIC SLOWDOWN — THEY NEED TO HAVE MORE? BECAUSE THEY HAVE THIS EQUITY THAT THEY HAVE NOT PULLED OUT? >>THE WAY THAT I THINK ABOUT IT THAT THERE WILL BE AN DOWNTURN IN TERMS OF EQUITY AND STANDARDS. THAT IS WHAT LEADS ME TO THINK THAT EVEN IF WE DO HAVE A RECESSION, IT IS NOT GOING TO BE ANYWHERE COMPARABLE TO WHAT WE SAW 10 YEARS AGO. I THINK THE BIG FAIR WHEN PEOPLE TALK ABOUT RECESSION IS, IF WE DO HAVE ONE, IT WILL BE RELATIVELY MILD. BUT THAT DOES NOT HELP YOU A LOT . >>SPEAKING OF RISKS AND — WE HAVE ANOTHER REPORT OF INAPPROPRIATE BEHAVIOR IN SILICON VALUE, BY GOOGLE. >>I AM INTERESTED IN THE STORY BECAUSE IT CONCERNS THE ME TO MOVEMENT AND THE POWER OF SILICON VALLEY. IT IS A CONVERGENCE OF THOSE THREE KINDS OF STORIES. IT IS A FORMER GLOBAL EMPLOYEE NAME JENNIFER THAT WORKED IN THAT WORKED WITH DAVID DRUMMOND AND THAT RELATIONSHIP WHEN BAD AND HE TOSSED HER ASIDE AND HER CHILD THAT IS HIS AND HE ACKNOWLEDGED THAT. I THINK SHE DID EVENTUALLY GET SOME CHILD SUPPORT. BUT, IT STILL FEELS LIKE SHE WAS LEFT IN THE LURCH IN TERMS OF HER CAREER AND OTHER MATTERS. SO YOU CAN TRY TO REDRESS THAT BY THE LEGAL SYSTEM THAT YOU WERE GOING UP AGAINST GOOGLE. OR YOU CAN STATE YOUR CASE IN THE COURT OF PUBLIC OPINION AND THAT IS ANOTHER PLATFORM WHERE YOU CAN OPEN AN ACCOUNT AND BLOG AND IN THIS CASE IT ATTRACTED ATTENTION. I THINK, JUST GETTING BACK TO THIS POINT ABOUT SILICON VALLEY, THIS KIND OF BEHAVIOR IS ENGENDERED IN AN ENVIRONMENT WHERE YOU FEEL LIKE YOU DON’T HAVE ANYONE TO ANSWER TO. WE HAVE THE CEO WHEN THEY SAY THEY ARE SO BIG AND CHANGING THE WORLD AND I THINK THE PSYCHOLOGY OF THAT IMPACTS BEHAVIOR ARE NOT IN A GOOD WAY. >>AND IN SOME CASES, — >>YES. AND SHE SAYS THAT THERE WERE POINTS OF BEHAVIOR AND SHE SAYS THAT HE LEADS A LIFESTYLE WHERE HE GETS TO DO WHAT HE WANTS AND SO SHE SHOULD BE ABLE TO AS WELL. >>IT IS GOOD TO SHINE A LIGHT ON THIS STUFF. ANDY, THANK YOU, FOR BEING HERE. COMING UP, STOCKS ARE TRADING HIGHER AND WHY RAM CO IS CONSIDERING WHAT COULD BE CONSIDERED A CHANGE TO THE LARGEST IPO OF ALL TIME. NOW. >>>COMING UP ON NOON HERE IN NEW YORK CITY, 2 AND A HALF HOURS INTO THE TRADING DAY AND STOCKS ARE RALLYING, THE DOW IS UP 1 AND S&P UP 1.5 AND NASDAQ UP 1.5. >>>THE LATEST, CHINA IS WILLING TO KEEP A CALM ATTITUDE IN NEGOTIATIONS FOR THE US. >>>A NUMBER OF BIG NAMES SAYS TARIFFS ARE TAKING A TOLL ON BUSINESS. THE SURPRISING EXCHANGE THAT ARAMCO IS IDENTIFYING FOR THE WORLD’S LARGEST IPO. >>>ADAM SHAPIRO IS OFF TODAY. LOWS LOOK AT THE MARKETS. WE’RE ON THE FLOOR WITH DETAILS. >>REPORTER: THIS RALLY REALLY HAS HOPES THAT THERE IS NO, HE IS CANTRELLLATION BETWEEN THE U.S. AND CHINA WHEN IT COMES TO THE TRADE WAR. THE NASDAQ IS GAINING THE MOST RIGHT NOW AS YOU CAN SEE. TECH WHICH IS LEADING THE GAINS, AND TAKE A LOOK AT THE SEMIS, THE SEMI CONDUCTOR COMPANIES WHICH HAVE EXPOSURE TO CHINA. LOOK AT NVIDIA, BROAD CONFEDERATE MONUMENT AND INTEL AND THIS IS ONE OF THE BEST PERFORMERS ON THE DOW AND JP MORGAN CHASE AND GOLDMAN SACHS AND HOME DEPOT. AND HOME DEPOT WAS HIGHER ON THE HEELS OF HURRICANE DORIAN. CHINA SAID IT DOES NOT WANT THE YEAR LONG TRADE WAR TO ESCALATE AND IT’S WILLING TO WORK WITH THE U.S. IN A CALM MANNER. AND WE HAVE DAN ROBERTS AND AKIKO FUJITA IS JOINING US NOW. I AM LOOKING AT THIS, AND THE MARKET IS TAKING AWAY SOMETHING POSITIVE. SHOULD THEY BE? >>IT’S INTERESTING TO SEE HOW THEY INTERPRET IT. IF YOU LOOK AT THE RALLY RIGHT NOW. THEY SEE A SOVEREIGN — IF YOU LOOK AT THE SOFTENING. YOU CAN SEE BOTH SIDES COME TO THE TABLE. A SPOKESPERSON DID SAY CHINA HAS SUFFICIENT MEANS TO RETALIATE. >>IT’S NOT RETALIATING YET. >>IT’S NOT RETALIATING YET, THAT’S WHERE THE CHINESE HAVE BEEN. THEY’VE SAID ALL ALONG, THEY WOULD LIKE TO NEGOTIATE THIS IN A CALM MANNER. WE HAVE HEARD THE WHITE HOUSE SAY THEY WANT FAIR AND RECIPROCAL TRADE. COULD YOU ARGUE TWEETS FROM THE PRESIDENT, THIS IS A GOOD SIGN THAT THE CHINESE ARE NOT MATCHING — >>TAKING THE BAIT IF YOU WILL. >>EXACTLY, IF YOU LOOK AT WHAT CHINA HAS BEEN DOING, THERE ARE REPORTS THAT CAME OUT YESTERDAY SUGGESTING THAT THE GOVERNMENT WAS REVIEWING THE RELIANCE OF TECH COMPANIES ON AMERICAN COMPANIES, WHICH SEEMS TO SUGGEST THAT THERE IS ANOTHER MOVE TOWARDS DECOUPLING, THEY’RE TRYING TO GET A SENSE OF THE SHOCK AND WHAT THESE COMPANIES ARE AND THE FURTHER THIS TRADE WAR CONTINUES. THERE’S AN UNRELIABLE ENTITY LIST, WHAT THEY’RE TALKING ABOUT BEFORE, TO MATCH THE COMMERCE DEPARTMENTS AND WHAT THEY’RE ON. >>THERE’S A LOT OF SIGNS THAT THE CHINESE ARE LOOKING AT POTENTIAL WAYS TO RETALIATE. AT THIS POINT THEY’RE SAYING, LOOK, LET’S JUST COME TO THE TABLE AND TALK. >>I ACTUALLY TOOK THAT PHRASE ABOUT BEING CALM AS A LITTLE BIT OF A JAB TO THE ADMINISTRATION. >>ABSOLUTELY. >>AND REALLY TRYING TO SHOW US, HERE’S HOW A POLICY HAS BEEN MADE, HOW THE SAUSAGE IS BEING MADE, SOMETHING, I GUESS UNIQUE, I THINK MANY AMERICANS, THE MARKET IS SLOWLY STARTING TO GET USED TO, SEEING THE SAUSAGE MADE, IT’S CLEARLY A JAB. >>IT’S FUNNY FOR ME TO SEE MARKETS MOVE HIGHER, NOTHING HAS REALLY CHANGED. BRYAN SAYS IT FEELS LIKE GROUNDHOG DAY. IT’S A COMMENT FROM TRUMP OR ANOTHER THING THAT TURNS THINGS NEGATIVE. ALL NEED THE WORD CALM AND THE STOCKS GO HIGHER. I DON’T SEE ANY NEW REASON FOR OPTIMISM. JUST THAT WE’RE NOT GOING TO RETALIATE AND THE LATEST RETALIATION, I DON’T SEE MUCH OPTIMISM. >>YOU ARE SEEING THIN TRADING AND MARKETS DON’T ALWAYS BEHAVE RATIONALLY — >>THERE IS STILL NO REAL CLARITY ON WHERE THOSE DISCUSSIONS STAND. WE HEARD STEVEN UNUSUAL SHIN SAY THE TALKS ARE MOVING FORWARD AND WE HEARD THE CONGRESSMAN IN CHINA SAYING THEY’RE STILL DISCUSSING UPCOMING TRADE TALKS. THEY HAVEN’T COMMITTED COMING TO WASHINGTON YET. EVEN ON THAT FRONT THERE IS STILL DISAGREEMENT. HE SAID IN THE G7 I GOT A CALL FROM CHINA THAT IT WAS VERY ENCOURAGING, BUT THEY SAY NO, INFORMS IN CALL, WE DON’T KNOW WHERE THAT CAME FROM. >>LIKE YOU SAID, IT’S AUGUST PEOPLE ARE THINKING ABOUT LABOR DAY WEEKEND. THERE’S A HINT OF OPTIMISM. >>IT’S ENOUGH TO SEND STOCKS UP TODAY. STOCKS, AS YOU’VE BEEN TALKING ABOUT ARE INDEED SURGING AFTER CHINA JUMP STARTS MARKETS. MAYBE YOU CAN EXPLAIN THIS TO US? >>CHINA SPEAKS VOLUME, IT’S THAT SIMPLE. STOCKS HAD A PROPENSITY TO RALLY ANYWAY. LOOK AT THE DOW, IT’S UP 300 POINTS AND S&P UP 2.5%, WE GAPPED UP AND CAME DOWN A LITTLE BIT. THIS WAS ON THE NEWS THAT THE ECB MIGHT NOT BE IN MONEY PRINTING MODE IN THE NEAR FUTURE. THAT WAS SHORTLY LIVED AND WE TOOK OFF HERE. IF WE LOOK AT A TWO MONTH CHART AND A CANDLESTICK CHART. THIS IS SOMETHING WE’VE BEEN LOOKING FOR AT A COUPLE OF WEEKS. WE HAVE BEEN IN THE TRADING RANGE BETWEEN 2940 WE HAVE RESISTANCE AND 2950. WE HAVE TRACED OUT THE W PATTERN, ARE WE GOING TO SELL OFF? WE’LL HAVE TO WAIT AND SEE. SOMETHING ELSE THAT’S INTERESTING HERE, IF I LOOK AT THE S&P 500 ADVANCE DECLINE LINE, THAT’S MEASURE OF BREADTH AND HOW MANY STOCKS ARE PARTICIPATING IN THIS RALLY, IT’S DIFFERENT IN THIS PICTURE. IT’S LOOKING SOMETHING LIKE THIS RIGHT NOW. WE’RE CHALLENGING THE HIGH, THE RECORD HIGH IN THAT BREADTH INDICATOR FROM A MONTH AGO. THAT IS BULLISH, ALSO WE’RE HEADING INTO THE MONTH AND WE COULD SEE A ROTATION OUT OF BONDS AND INTO STOCKS, AGAIN, WATCH OUT FOR THIS 2940 LEVEL. WE’RE GOING TO LOOK AT CRUDE OIL, THAT IS IN RALLY MODE. AND A LOT OF IT HAS TO DO WITH THE STORM. OF COURSE, IT WAS UP EARLIER ON THE NEWS THAT CHINA WAS EASING OFF THE US A LITTLE BIT IN TERMS OF TRADE, A LOT OF THIS HAS TO DO WITH THE STORM THAT IS NOW PROBABLY A CATEGORY 4, ABOUT TO HIT FLORIDA AND COULD EMERGE ON THE OTHER SIDE AND DISRUPT OIL OPERATIONS, THEN WE HAVE TO CHECK OUT SILVER, BECAUSE THIS IS AN INCREDIBLE CHART. WE’RE GOING TO GO BACK TO A TWO MONTH AND WE CAN SEE HOW IT’S BROKEN OUT TO THE UPSIDE HERE. IT’S BEEN UP 7 OF THE LAST 8 WEEKS, IT’S A STRONG MARKET. IT’S BENEFITING FROM RECORD ETF FLOWS, WE HAVE THE GREATEST FLOWS INTO THIS SINCE WE’VE SEEN RECORDKEEPING BEGAN IN 2006. THIS IS THE DOW HEAT MAP FOR THE DAY, MOSTLY GREEN HERE. I’LL POINT OUT WE HAVE RECORD HIGHS IN HOME DEPOT AND COCA COLA EARLIER, ALTHOUGH IT IS IN THE RED RIGHT NOW. >>>MEANWHILE, AS WE’VE BEEN TALKING ABOUT, THE TARIFFS, WE SHOULD MENTION THE EXISTING AND COMING TARIFFS ARE AFFECTING RETAILERS, WE HEARD FROM THE STORES, THEY REPORTED EARNINGS TODAY AND ALL OF THEM TALKED ABOUT TARIFFS AS A FACTOR AFFECTING BUSINESS FOR THE REMAINDER OF THE YEAR. THEY’RE NAVIGATING IT DIFFERENTLY DEPENDING ON THE RETAILER, LIKE BEST BUY. THERE ARE ELECTRONICS TARIFFS COMING LATER THIS YEAR AND ABERCROMBIE IS TALKING ABOUT ADVERSE EFFECTS FROM THE TARIFFS. ARE TARIFFS REALLY GOING TO BE A BIG HEAD WIND FOR RETAIL. >>FOR BEST BUY I HAVEN’T BEEN SHOPPING THERE FOR THE LAST FEW MONTH. >>YOU’RE NOTE THE ONLY ONE. >>QUITE A LOT OF PEOPLE. >>BUT, YOU KNOW, I THINK THE ABERCROMBIE PIECE, FOREVER 231, THEY’RE ANNOUNCING BANKRUPTCY, FOR ME THAT’S THE BEGINNING OF WHERE YOU CAN START TO SEE THE UNRAVELING, RIGHT? WHERE THEY CLOSE STORES, THEY HAVE TO LAYOFF AND LET GO OF EMPLOYEES, THOSE EMPLOYEES DON’T SPEND AS MUCH MONEY AND IT JUST, THE CYCLE STARTS, BUT RIGHT NOW, I THINK THE TARIFF PIECES, FOR CONSUMERS, IT’S STARTING TO HAVE EFFECT ON PEOPLE’S CONFIDENCE. >>BARREL. >>AND IT’S THE INDEX NUMBER THAT CAME OUT, PEOPLE ARE STILL FEELING PRETTY GOOD, BUT IF úTH WILL RAYON CONSUMERS. >>YOU’RE SEEING THIS AND THE RETAILERS ARE DOING WELL. JUST AS IN A RECESSION, YOU’LL SEE THE MARGINAL PLAYERS ROLL OVER IF THE TRADE WARS AFFECT THEM MORE, YOU’LL SEE THE MARGINAL PLAYERS, FOREVER 21 AS AN EXAMPLE ROLL OVER FIRST. >>THAT’S NUMBER OF THINGS HAPPENING AT ONCE. WE HAVE THE RISK OF CHALKING UP THE BUSINESS FOR FOREVER 21, THERE’S A UNTIL OF CHAINS THAT ARE STRUGGLING AND HAVE BEEN FOR YEARS, BECAUSE OF WHAT IS HAPPENING IN RETAIL AT LARGEST CITIES, SEPARATE FOR NOW ABOUT TARIFFS. AGREE IT’S BEGINNING TO AFFECT CONSUMERS, WE’RE IN THE EARLY INNINGS OF HEARING COMPANIES CALL IT OUT ON THE EARNINGS REPORT. WE HAVE A LOT OF GUESTS ROLLING IN THE LIVE SHOWS, AS LONG AS THE CONSUMER CONFIDENCE IS STILL HIGH, EVERYONE CAN FREAK OUT ABOUT YIELD CURVE INVERSION AND CONSUMER CONFIDENCE IS WA. INNING, I FEEL LIKE FOR OVER A YEAR, WE HAVE TALKED ABOUT TARIFFS, SOON IT WILL HIT THE AVERAGE CONSUMERS WATER AND THEN IT WILL HURT PRESIDENT TRUMP’S ELECTION CAMPAIGN. OH, IT’S HURTING ME, THAT HASN’T HAPPENED YET. IF WE GET POSITIVE RETAIL NUMBERS IN THE NEXT THREE MONTHS, WE’RE OFF THE RACES AND IT’S STILL NOT A PROBLEM. WE’RE WAITING TO SEE, AND THE EFFECT HAS BEEN TALKED UP A LITTLE TOO MUCH. THE NUMBER, THE IMPACT OF THE TARIFFS IS SMALL IN THE LARGER SCHEME OF THINGS. >>I WANT TO MENTION A HEADLINE FROM APPLE. IT’S SENT OUT INVITATIONS FOR SEPTEMBER 10TH FOR AN EVENT. IT HAS THESE EVENTS TO INTRODUCE NEW PRODUCTS PERIODICALLY, AND NEW iPHONES ARE EXPECTED PERHAPS AT THIS EVENT. MARK YOUR CALENDARS IF YOU ARE ONE OF THESE PEOPLE WHO WATCHES THESE THINGS. AND THE STOCK IS UP 1.6% AT THE MOMENT. WE’LL MONITOR THAT. >>>LET’S MOVE TO THE OIL MARKETS AND SAUDI ARAMCO. THEY’R GOING TO SPLIT IT INTO TWO PLACES. THERE WILL BE AN INTERNATIONAL OFFERING IN 2020 OR 2021. IT’S LEANING TOWARDS TOKYO, ALL OF THIS ACCORDING TO THE WALL STREET JOURNAL. LONDON IS POLITICALLY CHALLENGED BECAUSE OF “BREXIT,” HONG KONG IS POLITICALLY CHALLENGED BECAUSE OF THE PROTESTS THERE, LET’S GO TO TOKYO. YOU DO HAVE TO WONDER IF THERE ARE OTHER ISSUES AT PLAY. >>YEAH, I GUESS I THOUGHT THE SAME THING TOO. BUT, YOU KNOW, THIS IS AN EXAMPLE OF POLITICS, IT’S TRUMPING THE ECONOMICS. SOMETHING I SAW A GREAT DEAL OF TIMES WHILE I WAS AT THE LABOR DEPARTMENT. THE TOKYO AND STOCK MARKET, THEY’VE HAD TWO OF THE LARGEST IPOS, FROM A STANDPOINT, CAN THEY HANDLE IT? I THINK THEY CAN. >>AND I THINK POLITICS, ABSOLUTELY ARE TRUMPING THE ECONOMICS FOR NEW WITH THIS COMPANY. LET’S REMEMBER TOO, IT’S AFFECTED BY THE WORLDWIDE OIL MARKET CHANGING, OPEC LOSING PURR OVER THE OIL CRISIS AND THIS IS HANGING FROM THE KOSHEGI INCIDENT. UBER CAME UNDER FIRE FOR THIS. THE SOFT BANK CONNECTION, ALL OF THIS COMES INTO PLAY. THIS IS A PLAYING A IPO IN TERMS OF SIZE. YOU’RE RIGHT ABOUT TOKYO, WE SHOULDN’T BE TOTALLY SHOCKED, THIS WOULD BE HUGE FOR THE TOKYO EXCHANGE. >>EVEN THOUGH THIS WILL BE PUBLIC ON THE SAUDI EXCHANGE, AND IT WILL BE AVAILABLE TO OUTSIDE INVESTORS TOO. IT’S ALREADY PUSHED IT BACK AND CHANGED THE PLANS, IT’S TALKING ABOUT LATER THIS YEAR, IT WILL HAVE THE SAUDI DEBUT AND IN 2021, WE’LL SEE IF THIS ACTUALLY — IT HASN’T BEEN CONFIRMED BY ARAMCO YET. >>THE DEVIL IS IN THE DETAILS. >>THAT’S RIGHT. >>THERE’S STILL A LOT OF CONFIRMATION THAT NEEDS TO HAPPEN HERE. >>COMING UP, ENERGY SHIFT, WHY BIG NAMES MAY NOT BE ON BOARD OF PRESIDENT TRUMP’S PLANS TO RID OBAMA’S PLANS ON THE SECTOR. >>>YOU SEE THESE ON THE LIST, INCLUDING BEST BUY. >>>CHINA REPEATS A CALM TRADE RESOLUTION, THE TRADE WAR FAR FROM RESOLVED. THE JUSTIFICATION IS IMPORTANT IN THIS ENVIRONMENT WHERE UNCERTAINTY IS ELEVATED. FIRST OF ALL, IF PEOPLE DON’T UNDERSTAND WHAT ALL OF THAT MEANS, RISK PARODY AND MANAGED PORTFOLIO STRATEGIES, WHAT IS THAT AND WHAT SORT OF ROLE SHOULD IT WILL BE PLAYING FOR PEOPLE RIGHT NOW. >>RISK PARODY PORTFOLIO, IT’S CENTERED AROUND EQUAILSATION, AND HIGH GROWTH AND LOW GROWTH ASSETS, AND THIS IS A KEY ENVIRONMENT FOR RISK PARODY, THIS IS UNCHARTERED WATERS. HOW COULD YOU HAVE CERTAINTY IN THIS ENVIRONMENT. >>DO WE TALK ABOUT EQUITY AND BOND ALLOCATION OR OTHER INVESTMENTS AS WELL. >>WE TRADE 65 MARKETS, EQUITY INDEXES, COMMODITIES, 24 DIFFERENT COMMODITIES, SOVEREIGN BONDS AND CREDIT SPREADS. WE HAVE TRY TO HAVE EQUAL EXPOSURE. >>WHEN WE TALK ABOUT DIVERSION, DO WE GO INTO GOLD AND CRYPTOCURRENCY. >>I DON’T KNOW IF I WOULD CALL CRYPTOCURRENCY MITIGATING RISK, BUT GOLD IS AN ASSET ALLOCATION. >>YOU’RE PRACTICING THE AGE OLD INVESTING SO 1, DIVERSIFY, DIVERSIFY AND DIVERSIFY. >>THAT’S RIGHT, IT STARTS THERE, WE SHOULD ALL LEAN ON THAT, AS A QUANTITY, QUANT, WE’RE LEANING ON THAT DIVERSIFICATION ON THAT VIEW. >>WHAT ROLE SHOULD RISK PARITY PLAY ON THAT, IF YOU DIVERSIFY AND GET A CUSHION, YOU CAN MISS OUT ON UPSIDE IN CERTAIN SITUATIONS, SO WHAT’S THE BALANCE LOOK LIKE. >>YOU KNOW, I THINK, IT’S A CORE ASSET, A GROWTH ASSET AND A ASSET CLASS, IT BE CAN’T BE BENCH MARKED, IT’S TOO DIFFERENT, AND THE RISK IN RISK PARITY, IT’S DIVERSIFIED, SO IF STOCKS ARE THE BEST PERFORMING ASSET CLASS, WE’RE LIKELY TO UNDERPERFORM THAT, THE BOOM AND BUST CYCLE OF A SINGLE ASSET WILL CAUSE A PORTFOLO TO UNDER PERFORM. >>>WHAT ARE YOU SEEING VERSUS ONE YEAR AGO AND FIVE YEARS AGO? >>IT’S PICKED UP AND PEOPLE HAVE DONE WELL IN STOCKS AND WANT TO DIVERSIFY THAT RISK. >>THERE’S NOT A HUGE AMOUNT, WE’RE SEEING, IT OVERSEES INVESTORS WHO ARE TIRED OF THE BOND PORTFOLIOS. 0 INTEREST ENVIRONMENT OR LESS IS ONE IN WHICH YOU MIGHT TRY TO DO SOMETHING DIFFERENT WITH YOUR FIXED INCOME ALLOCATION. >>IT MAKES ACCEPTS. THANKS FOR COMING IN. >>THANKS FOR HAVING ME. >>>METHANE GAS EMISSIONS MAY BE ON THE WAY FOR OIL AND GAS COMPANIES. THEY’RE LOOKING TO ROLL BACK RULES FOR GAS COMPANIES AND GAS LEAKS AND PLUG THEM. WE HAVE A CHIEF STRATEGIST AND RICK NEWMAN WHO HAS BEEN WATCHING THIS CLOSELY HERE. WE HAD A REPRESENTATIVE ON IN THE LAST HOUR, AND AFTER SPEAKING TO HIM I’M MORE CONFUSED THAN EVER AS TO WHAT THESE REGULATIONS OR ROLL BACK OF REGULATIONS DO, MAYBE I SHOULD START WITH YOU, IF YOU CAN EXPLAIN FOR US, WHAT EXACTLY — >>I’M NOT AN EXPERT ON THE REGULATIONS, THERE WAS A OBAMA ERA RULE THAT WOULD REQUIRE NEW WAYS FOR THE LEAKS WHICH IS EXPENSIVE. THE TRUMP ADMINISTRATION SAYS IT WILL DUE AWAY WITH THAT UNIFORMITY FROM WHAT I CAN TELL, FOR BIGGER COMPANIES THIS IS NOT THAT MUCH OF A HASSLE. THEY CAN AFFORD TO DO THIS. IT’S A BURDEN FOR SMALLER COMPANIES. YOU’RE FINE WITH REGULATIONS, THE COST OF COMPLIANCE IS A LOT HARDER. IF YOU’RE A SMALLER COMPANY, THERE ARE SMALL OPERATORS IN THE BUSINESS, NOT JUST EXXON AND SHELL. THE ENERGY INDUSTRY AT THE SENIOR LEVEL KNOWS THERE’S THIS THING CALLED THE GREEN NEW DEAL. DEMOCRATS ARE HOT ON THIS. IT’S TO MOVE THE WHOLE ECONOMY AWAY FROM CARBON. NATURAL GAS IS A CLEANER FUEL EVEN THOUGH IT’S COAL. THE ENERGY WANTS US TO THINK NATURAL GAS AS A CLEANER ENERGY, IT’S CLEANER THAN COAL. IT’S A REPUTATION AND LABELING THING. IF YOU’RE LETTING EMISSIONS, YOU’RE POLLUTERRING MORE AND THIS IS A DIRTIER FORM OF ENERGY. >>THIS AFFECTS. >>THE REGULATIONS DON’T CHANGE FOR NEW DEVELOPMENTS, I DON’T KNOW, HOW CLOSELY ARE YOU WATCHING IT IF YOU TRADE OIL AND GAS? >>WE’RE NOT WATCHING IT AS TRADERS, IT’S AN ENVIRONMENTAL, IT’S MORE ABOUT A BAD DECISION THAT PRESIDENT OBAMA MADE, NO THAT WE DON’T WANT TO GET IT GREEN. HE MADE THE REGULATION TO AS FAST. HE DIDN’T ALLOW THE SMALLER BUSINESSES TO GET INVOLVED. I’M 100% BEHIND A CLEANER ENVIRONMENT AND BETTER, BUT WE HAVE TO LET THESE GUYS WORK THEIR WAY OUT OF WHERE THEY’RE AT AND YOU HAVE THE BIG GUYS, YOU WANT THEM TO SET IT UP F FACEBOOK WANTS TO BE REGULATED. >>. >>THERE’S NO MORE GUYS GOING AFTER IT. THERE’S A TON OF METHANE GAS, YOU CAN WATER, AND THIS COMES OUT OF HERE. >>YOU WANT TO MITIGATE IT. >>WE WANT TO MAKE IT CLEANER, WE HAVE TO DO IT OVER TIME. >>IT’S OVER NOW, AND ALL YOU GUYS ARE OUT OF BUSINESS, SOME THE BIG COMPANIES LIKE EXXON SPENT TO ADHERE TO THE REGULATION, THAT’S WHY AT THIS POINT, WE HAVE THAT IN PLACE, WE WANTED TO PEEL IT BACK. >>THEY ELIMINATE THIS COMPETITION THAT’S COMING FORWARD AND NATURAL GAS IS GOING TO BE AT SOME POINT REAL COMPETITION TO OIL. >>THE SMALL GUYS ARE IN A ROBUST POSITION RIGHT NOW. WE HAVE SEEN A SHAKEOUT IN THE OIL AND GAS INDUSTRY IN SOME OF THE WEAKER PLAYERS. THEY HAVE A STRONG BALANCE AND WOULDN’T THIS BE THE TIME TO DO IT RATHER THAN PHASE IT IN OVER SEVERAL YEARS AT A TIME WHEN WE MIGHT SEE A WEAKER OIL AND NATURAL GAS PRICE. WE MAY BE IN A WEAKER PLACE IN THE ECONOMY. >>OIL WISE, WE HAVE ENOUGH OIL FOREVER, BASICALLY, WE HAVE OVER 200 SUPPLY IN THIS COUNTRY WITHOUT WORRYING ABOUT ANYBODY ELSE. >>THIS IS NOT AN ISSUE, THE REAL ISSUE COMES WHEN YOU FORCE ONEROUS REGULATIONS ON BUSINESSES AND YOU PUT THEM OUT OF BUSINESS. IT DOES NOT BREED COMPETITION AND I BELIEVE THE AMERICAN SYSTEM IS IT CREATE COMPETITION TO CREATE BUSINESS. >>WHAT I’M ASKING, IF THE OBAMA ADMINISTRATION PUT THIS IN PLACE, HAS IT GONE OUT — >>I’M SURE IT DIDN’T START UP BECAUSE THEY DIDN’T HAVE THE OPPORTUNITY, I’M SURE THE STARTUP COSTS ARE EXTREMELY, MUCH HIGHER THAN THEY ARE IF YOU WOULD HAVE A STARTUP. >>>, I HAVE TO PUT IN THESE REGULATIONS I CAN’T MEET THE STANDARDS. >>THAT’S PRECEDENT FOR REGULATIONS BASED ON SIZE. WE SAW IT IN BANKING, SOME OF THE DODD FRANK RULES THAT WENT INTO BANKS. THE BIG BANKS COULD HANDLE THEM FINE AND SMALLER COMMUNITY BANKS WERE STRUGGLING WITH RULES. WE HAD ROLL BACKS FOR SMALLER BANKS. WE HAVE ONE RULE FOR BANKS, IF YOU ARE ONE OF THE BANKS THAT CAN AFFECT THE ECONOMY, YOU HAVE ONE OF THE HIGHEST STANDARDS TO ABIDE BY. THIS CHANGE IN REGULATION DOES DID OUT FOR COMMENT. THEY CAN BE CHANGED. THERE WILL BE A LOT PEOPLE SAYING, HERE ARE OUR SUGGESTIONS AND I THINK THE TRUMP ADMINISTRATION SEEMS GOB SMACKED BIT IDEA, THIS HAPPENED IN THE — BY THE IDEA, THIS HAPPENED IN THE AUTO INDUSTRY, THEY’RE SAYING WE DON’T NEED THE HELP, COME ON, MAN. I THINK THE OUTCOME CAN HOLD THE REGULATIONS IN PLACE FOR BIGGER COMPANIES BUT SETS A THRESHOLD WITH A LONGER COMPLIANCE TIMELINE — >>I THINK THIS WILL GO ON WHETHER PRESIDENT TRUMP WINS A SECOND TERM OR NOT, BUT FOR MANY YEARS PAST. >>THIS WILL GET CHALLENGED IN THE COURTS — >>EVERY COURT IN THE WORLD. THIS IS A LONG WAY FROM JUST SIGNING A WAIVER AND SAYING OKAY THIS IS GOING TO BE LAW. >>WHILE WE HAVE YOU HERE, I HAVE TO ASK YOU WHAT YOUR OUTLOOK IS CURRENTLY WHEN YOU LOOK AT OIL AND NATURAL GAS PRICES? >>NATURAL GAS WILL GO LOWER AND IT WILL GO LOWER, LOWER UNTIL IT GETS COLD AND THEN THEY’LL BURN OFF TOO MUCH OF IT AND THEY’LL NEED IT AND THIS WILL AND EXPLOSION SOMEWHERE NOVEMBER, DECEMBER FOR THE FIRST COLD SNAP. >>>SOMETHING IS GOING ON IN OIL. WHEN YOU LOOK AT THE FORMATION OF OIL, THERE’S BACKWARDATION AND CONTAINING OH, THIS IS A DOLLAR OVER DECEMBER I AM. OIL SHOULD BE MORE EXPENSIVE IN THE FUTURE AND WHAT TELLS ME THERE IS UNDERLYING FEAR DRIVING THE PRICE UP. IF YOU GO BACK AND LOOK ANY TIME THIS FORMATION APPEARS, THE BIGGEST TIME AND LAST WAS 2014. THIS WENT TO 36. I BELIEVE ALTHOUGH RIGHT NOW, IT’S GOING TO TEST 60S, I WOULD THINK LONGER TERM, OIL WILL SEE THE HIGH 40s IF NOT LOWER. >>THAT’S A INVERTED YIELD CURVE. >>FEAR IS DRIVING THE MARKET TODAY. THE MINUTE IT STARTS TO GO HIGHER THEY CHASE AT SOME POINT. WE HAVE SUCH AN OVERSUPPLY AND THE ECONOMY IS NOT AS STRONG AS IT IS, IT’S STARTING TO WEAKEN. THERE ARE A LOT OF ISSUES THAT WILL HELP OIL GO SIGNIFICANTLY LOWER. I’M LOOKING FOR AN OPPORTUNITY TO SALE. >>IT’S LIKE THE VIX FOR OIL. HE HAPPENS SOME IF YOU WANT ANY OIL. >>THANK YOU. >>>COMING UP, DORIAN IS BARRELLING TOWARDS THE U.S., WHAT YOU NEED TO KNOW WHAT’S EXPECTED TO BE A CATEGORY 4 STORM AS IT STRIKES FLORIDA THIS WEEKEND. >>>AND LET’S LOOK AT TODAY’S LOSERS ON WALL STREET. OLLIE’S BARGAIN FALLING SHARPLY AFTER THE COMPANY MISSED ESTIMATES. . >>>IT’S AROUND 12:30PM IN NEW YORK CITY, THREE HOURS INTO THE TRADING DAY. THE S&P RISING 1.3%. GOLD, THERE’S RISK APPETITE COMING IN TODAY, GOLD IS FALLING. >>>OPINIONATED BACKLASH, ONE IS WARNING DANGER WITH THE FEDERAL RESERVE. A MEETING OF THE MIND, THEY SQUARE OFF OVER THE FUTURE OF AI AND BRACING FOR IMPACTS, FLORIDA RESIDENTS PREPARE AS HURRICANE DORIAN BARRELS TOWARDS THAT STATE. >>>FAKE MEAT ISN’T THE ONLY HEALTHY FOOD PRODUCT TO SEE INNOVATION, PLANT BASED PRODUCTS WILL BE IN THE UNITED STATES AND VENDING MACHINES LIKE THE HEALTH FRESH FRIDGE WILL HAVE THE PLANT BASED PROBIOTIC FOOD TO MAINE STREAMED AUDIENCE. JULIE, THANKS FOR COMING IN. FOR PEOPLE WHO NOT FAMILIAR WITH THIS, IT’S A DAIRY PRODUCT, IT’S A PROBIOTIC, IT’S LIKE DRINKABLE YOGURT. >>YEAH, IT’S IN THE COUSINS OF THE YOGURT DRINK CATEGORY, IT’S A STORIED 2,000 YEAR PRODUCT WITH A LONG FOLKLORE AND HISTORY ABOUT IT. >>HOW DO YOU DISRUPT SOMETHING THAT STORIED AND BEEN AROUND SO LONG. YOU HAVE A VEGAN VERSION OF IT. >>CONSUMERS ARE DRIVING INNOVATION IN A 2,000 YEAR OLD PRODUCT. IT’S REALLY EXCITING FOR US TO SEE THAT IT HAS BEEN ACCEPTED, THAT ONCE AN OBSCURE PRODUCT IN EASTERN EUROPE HAS BECOME SO MAINSTREAM IN THE UNITED STATES AND IS NOW HITTING VENDING MACHINES, AND YOU KNOW IT’S REALLY IMPORTANT FOR US TO MAKE SURE THAT KEFFIR IS AVAILABLE WHERE CONSUMERS EAT, PLAY AND WORK, TO SEE THEM IN AN AMERICAN VENDING MACHINE IN THE EAST COAST IS REALLY POWERFUL AND EPIC AND A HISTORIC MOMENT FOR THE KEFFIR TIMELINE IN HISTORY. WITH THE PLANT BASED LINE, WE’RE SEEING 90% OF AMERICAN CONSUMERS LOOKING TO BE FLEXATARIAN WITH THEIR DIETS, THEY’RE NOT CLOSING DAIRY, THEY’RE LOOKING TO BE MORE ETHICAL, CONSCIOUS, THEY’RE LOOKING AT SUSTAINABILITY ISSUES, THESE ARE ALL DRIVING FACTORS WHICH LED US TO DEVELOP THE PLANT BASED LINE CALLED PLANTIFUL, THAT WILL BE HITTING VENDING MACHINES AS WELL. THAT’S EXCITING, BIG FOOD IS BEING DISRUPTED IN MANY WAYS, KELLOGG’S AND GENERAL MILLS, YOGURT IS ONE EXAMPLE, WE HAVE A PER RAID OF SMALL BEVERAGE BRANDS THAT ARE HEALTHIER AND ALTERNATIVES TO BIG SALE AND THEY SELL AND GET GOBBLED UP BY COCA COLA AND PEPSY CO, IS THERE ROOM FOR NEW PLAYERS, THERE ARE A NUMBER OF BLUE BRANDS AND ALL OF THEM CAN DO WELL AND GROW RIGHT NOW? >>THERE’S A LOT OF BEGAN FOR ALTERNATIVES AND VARIOUS INNOVATIONS WITHIN THAT, WHETHER IT’S INCLUSIONS OF CHARCOAL OR ADAPTOGENS, IT’S THE STARTUP CREATING THE INNOVATION. THE BIG COMPANY CAN’T BE AS NIMBLE AND RESPOND TO CONSUMER NEEDS, THESE CONSUMERS ARE DRIVING CHANGES IN THE FOOD SUPPLY SYSTEM, EPIC FAST LEVELS, LIKE WE’VE NEVER SEEN SUCH A FLIP ON FOOD RIGHT NOW. THE BIGGER COMPANIES ARE HAVING A HARD TIME BEING AS NIMBLE WHICH PUNS US IN A GREAT POSITION, WE’RE NOT A STARTUP, BUT WE’RE NOT SO BIG YET. WE’RE IN THE 95% CATEGORY LEADER IN KEFFIR, WE HAVE A LOT OF OPPORTUNITIES TO GROW AND WE CAN RESPOND TO CONSUMER DEMANDS QUICKLY AND WE COULD HAVE A PLANT BASED PRODUCT AND QUICK TO SPEED TO MARKET. WE CAN LEVERAGE OUR PARTNERS AND THE EXISTING RELATIONSHIPS AND OUR KNOW HOW TO GET OUR PLANT BASED LINE INTO THE MARKETPLACE QUICKLY IN WAYS THAT THE LARGER COMPANIES CAN’T. >>MY FELLOW YOGIS WILL BE GRATEFUL THAT WE HAVE THE NEW PLANT BASE. >>TWO WEEKS AGO, NO ONE WAS TALKING ABOUT RECESSION OR THE SLOWDOWN, AND NOW, THAT’S THE BUZZ, AND ONE OF THE CONCERNS IS WE CAN TALK OURSELVES INTO THE RECESSION, AS A CEO, HOW DO YOU START TO BEGIN ABOUT THE FUTURE, WITH THIS CONCERN THAT PEOPLE HAVE? >>WELL, YOU KNOW, I WAS AROUND FOR THE 2008 RECESSION WHICH IS ONE OF OUR FIRST BIG ONES, AND WHAT WE SAW WAS THAT ACTUALLY, IN THE TIMES OF RECESSION, CONSUMERS ACTUALLY LEAN INTO AFFORDABLE LUXURIES AND WHAT WE’RE SEEING IS THAT FOOD IS NO LONGER CONSIDERED A LUXURY. FOOD IS NOW CONSIDERED A PART OF HEALTH CARE, IT WAS CONSIDERED PART OF WELL-BEING AND IT’S BECOME NON-NEGOTIABLE, AND CONSUMERS ARE DEMANDING HEALTHIER FOOD CHOICES AND ACCESS TO THEM IN WAYS THAT WE’VE NOT SEEN BEFORE. AND WE HAVE DRIVEN A LOT OF CHANGES AND INNOVATIONS AND WE’RE SEEING MAINSTREAM MARKETS OPEN THEIR MINDS AND THEIR OFFERINGS TO ITEMS THAT HAVE NEVER BEEN AVAILABLE BEFORE, WE HAVE NEVER SEEN SUCH A THING, SO, IT’S REALLY, REALLY POWERFUL, AND I THINK IT’S AN EPIC HISTORIC TIME IN OUR FOOD SYSTEM RIGHT NOW, AND EVEN IN THE RECESSION, WE SAW PARENTS, SWITCH TO A HEALTHIER OPTION WITH OUR PRO BUGS AND EVEN THOUGH IT WAS THE MOST HE CAN PENSIVE LINE IN THE PORTFOLIO, IT LEANED INTO IT AND DISRUPTED THE BABY FEEDING SPACE USING THE POUCHES NOW. >>THANK YOU SO MUCH. >>WELL, SPEAKING OF DRINKABLES, IRIS IS LOOKING FOR THE DIRTY LEMON BRAND OF DRINKS, WE COULD SEE A BIGGER PUBLIC FUTURE IN THE NEXT FEW YEARS. ZACH SAT DOWN TO DISCUSS THIS. >>LET’S SAY A COKE, LET’S SAY JAMES QUINCY CAME ON NOTCHING ON THE DOOR WE WOULD LOVE TO PURCHASE THESE PRODUCTS IN ITS ENTIRETY, WOULD YOU SAY YES TO AN OFFER LIKE THAT? >>OBVIOUSLY, WE’RE NOT BUILDING FOR THAT RIGHT NOW, I THINK THAT, YOU KNOW, OBVIOUSLY AS A STARTUP, WE’RE LOOKING TO EVENTUALLY WE HAVE A LOT OF INVESTORS AND WE NEED TO PROVIDE A RETURN FOR THOSE INVESTORS, I THINK THE EVENTUAL PATH TO EXIT FOR US IS THROUGH AN IPO AND CONTINUE TO DO WHAT WE’RE DOING ON A LARGER SCALE. >>WE HAVE SEEN UBER, LYFT, AND WE WORK AND PELTON COMING UP WHAT DO YOU WANT TO GET TO IN THE NEXT SEVERAL YEARS? >>WE WANT TO GET TO $100 MILLION PROFITABLE AND WE WANT BRANDS IN THE PORTFOLIO AND I THINK THAT WILL HAPPEN IN THE NEXT TWO TO THREE YEARS. >>>EMILY IS HERE TO TELL US ABOUT IT. WE WERE HEARING ABOUT KEFFIR, TALK ABOUT SOME OF THE IMPRESSIONS ABOUT DIRTY LEMON. >>SHE MENTIONED CHARCOAL BASED DRINKS, THEY HAD OTHER WELLNESS BASED PRODUCTS, CHROMIUM, CHARCOAL AND THEY BLEND IT INTO THESE DRINKS. WHAT THEY’RE TRYING TO DO IS THEY’RE TRYING TO COMPETE WITH THE COCA COLAS AND THE PEPSIS OF THE WORLD, WITH THE INCUMBENT LEADERS IN THE BEVERAGE SPACE. THEY’RE TRYING TO CREATE THE COMPANY WITH AN ENORMOUS COMPANY WITH LITTLE BRANDS IN IT. THEY DON’T BELIEVE THERE WILL BE BILLION DOLLAR BRANDS THERE’LL BE MILLION DOLLARS BRANDS IN A BILLION DOLLAR COMPANY. THERE ISN’T MUCH IN THE FOOD AND BEVERAGE WORLD AND CREATE A BILLION DOLLAR DRINK LIKE COCA COLA, BUT THERE ARE DEW POINTS FOR SMALLER PLAYERS TO BE IN THIS INDUSTRY. THEY’RE NOT LOOK TO BE BOUGHT BY COCA COLA. >>NO ONE IS LOOKING TO BUY UNTIL THEY’VE BEEN BOUGHT. >>I’M CURIOUS TO HEAR FROM YOUR YOG FRIENDS, HAVE THEY BEEN DRINKING THIS STUFF? >>NO. >>I’M CURRENT WITH THE CURRENT REACHES AND WHAT THE POTENTIAL REACH IS. >>SOMEONE IS DRINKING IT? >>EXACTLY. >>THEY SOLD 2 BILLION TO DATE AND IT’S SIZEABLE FOR BEING A COUPLE OF YEARS AND BEING A SEED STARTUP. THE LAST INFUSION THEY HAD WAS $15 MILLION AND A $16 MILLION VALUATION, TO TARGET A IPO IS SOON IF WE LOOK AT HOW LONG PRIVATES HAVE STAYED PRIVATE. WE’RE LOOKING AT THE UBER AND LYFT GOING PUBLIC THIS YEAR. IT’S AN INTERESTING COMPANY TO KEEP AN EYE ON. >>>WE’LL BRINGING YOU BREAKING NEWS. IT HAS TO DO WITH JUUL. THEY’RE INVESTIGATING THE MARKETING PRACTICES AT THAT COMPANY. THEY’RE LOOKING TO SEE IF JUUL USED DECEPTIVE MARKETS TARGETED TO MINORS. THIS IS SOMETHING THAT HAS BEEN TALKED ABOUT REGARDING JUUL IN THE PAST. WE’LL BE RIGHT BACK AND KEEP YOU POSTED ON ANY FURTHER DEVELOPMENTS. WE’LL BE RIGHT BACK. E. >>>LET’S TAKE A LOOK AT THE TOP TRENDING STORIES ON YAHOO FINANCE, THEY VIOLATED THE JUSTICE DEPARTMENT AND POLICIES WHEN HE SHARED MEMOS OF INTERACTIONS IN 201, THAT’S ACCORDING TO A JUSTICE DEPARTMENT WATCH DOG, AND THIS IS WHAT THEY CALLED THE EARLY EFFORTS ON WHAT SHUT DOWN THE INVESTIGATION INTO RUSSIA’S INTERFERENCE IN THE 2016 ELECTION. AND THE HURRICANE, HURRICANE DORIAN IS EXPECTED TO BE A CATEGORY 4 WHEN IT MAKES LANDFALL NEXT WEEK. THE STORM CAUSED DAMAGE IN U.S. VIRGIN ISLANDS. >>>YOU CAN BUY INSURANCE IN THE ELECTRIC CAR COMPANY. THE COMPANY WOULD BRANCH INTO INSURING CARS FOR PEOPLE WHO BUY OR LEASE THEM. >>>AND OUR NEXT GUEST SAYS IT’S IMPORTANT FOR PARENTS TO SUPPORT FINANCIAL LITERACY AT HOME AND TEACHING IT IN SCHOOL, THERE’S A COMPANY CALLED EVER. IF I IT WILL HELP CHILDREN LEARN TO TACKLE FINANCIAL LITERACY BEFORE GOING TO COLLEGE AND IN THE REEL WORLD. YOU PROVIDE A HOST OF DIFFERENT TYPES OF EDUCATION AND NOT JUST FINANCIAL LITERACY. THAT’S IMPORTANT TO OUR VIEWERS. WHAT KIND OF ROLE DO YOU THINK IT NEEDS IN SCHOOLS AND HOW DO YOU TEACH IT. >>I THINK WE ALL GRADUATED FROM HIGH SCHOOL AND COLLEGE AND MOST OF US LOOK BACK AND SAY, WHY DIDN’T I LEARN ABOUT MORTGAGES, WHY DIDN’T I LEARN ABOUT MANAGING MY STUDENT LOANS, WHY DIDN’T I LEARN HOW THE STOCK EXCHANGE WORKED AND HOW COMMODITIES WERE TRADED. THE LACK OF THIS IN SCHOOLS, THE FACT IT’S NOT TAUGHT OR REQUIRED ACROSS THE COUNTRY, IT TENDS TO SEND KIDS OUT INTO THE WILD WHEN WE GRADUATE. WE LEARN THESE THINGS BY MISTAKES, WE TRIP UP ON BILLS, AND DING OUR CREDIT, WE THINK THEY’RE UNNECESSARY FOOT FAULTS AT THE END OF DAY. IT’S SOMETHING THAT KIDS SHOULD LEARN IN SECOND GRADE AND GO THROUGH THE LIFE CYCLE WHEN THEY GRADUATE. >>IS THIS PART OF THE CURRICULUM. WHY NOT PUSH FORWARD TO BE PART OF CURRICULAR ACROSS THE UNITED STATES INSTEAD OF HAVING A COMPANY LIKE YOURS COME IN WITH AN EXTERNAL PRODUCT IF YOU WILL. >>YEAH, IT’S A GREAT QUESTION, IT ALSO, YOU CAN THINK ABOUT LOTS OF THINGS THAT WE DON’T LEARN IN SCHOOL THAT PROBABLY SHOULD BE IN THE SCHOOL DAY, WE’VE BEEN PUSHING THIS, IT’S A HAND TO HAND COMBAT GAME, IT’S NOT SOMETHING THAT CAN BE MANDATED AT THE FEDERAL LEVEL. WE RELY ON STATES AND I USED TO BE A STATE LEGISLATURE OUT OF COLLEGE, WE LEARN THAT THESE ARE COUNTY BY COUNTY DECISIONS, OUR GIG IS HOW DO YOU BRING THIS AND AT NO COSTS TO SCHOOLS ACROSS THOUSANDS AND THOUSANDS, AND 28,000 SCHOOLS ACROSS — >>WHO PAYS FOR IT? >>WE TEAM UP WITH INTERESTING FOLKS, NONE FROM NHL AND WE RUN A MILLION PLUS PROGRAM IN THE COUNTRY, KELLY KING FROM BB&T HAVE STEPPED IN AND TIMED THIS TO EARLY READING AND LITERACY. IT’S FASCINATING, YOU SEE THE PRIVATE SECTOR STEPPING UP TO LEAD THIS. THE CHALLENGE OF THIS IS YOU CAN’T, THE INCONSISTENCY OF MUNICIPAL FUNDING, SCHOOL BOARD FUNDING, AND THE CHANGES IN THE WHIPLASH THAT GOES ON FOR TEACHERS AND WHETHER IT WILL BE AVAILABLE, WE THINK THE PRIVATE SECTOR IS THE CONSISTENT THREAD IN ALL OF THAT. >>I’M AN ECONOMIST MYSELF AND ACTUALLY HAVE DONE A BIT OF WORK IN FINANCIAL LITERACY. I WOULD LIKE TO SHIFT IT FROM FINANCIAL LITERACY TO ECONOMIC LITERACY WHICH STILL CONNECTS. AND AS A FORMER SCHOOL BOARD MEMBER, THE DIFFICULTY I FOUND WITH, LIKE TRYING TO GET FINANCIAL LITERACY, AND INTO THE CURRICULUM WAS, THE HIGH STAKES TESTING, THERE’S THIS BELIEF, ALL OF THIS OTHER TEST AND ISSUES AND IDEAS AND LESSONS THAT WE HAVE TO TEACH KIDS, AND HAVE YOU THOUGHT ABOUT HOW TO COMBAT THAT? >>SUCH A GOOD QUESTION, YOU FIND THAT DOLLARS ARE ONE THING, TIME IS THE MOST PRECIOUS COMMODITY. TEACHERS ARE NOT JUST UNDER PRESSURE TO TEACH TO THE TEST, BUT HOW TO GET KIDS FED, HOW TO GET THEM TO SLEEP AT NIGHT AND HOW TO SERVE AS A COPARENT IN A LOT OF PLACES AND PARTICULARLY IN A HIGH POVERTY AREA. IT’S AN UNFAIR FIGHT FOR TEACHERS, WE SHOULD BE PAYING THEM MORE AND HOLDING THEM UP AS HIGH AS WE CAN. YOU CAN’T THROW THIS STUFF OVER THE WALL AND HOPE IT GETS IN. WE HAVE HIRED 150 FORMER FULL- TIME TEACHERS WHO WHEN WE’RE IN THE MISSISSIPPI DELTA AND THE ALABAMA BLACK BELT AND IN THE RESERVATIONS IN MACHINE MONTH, THESE FOLKS ARE GOING IN AND THE CORE CURRICULUM, WE’RE FINDING THAT TIME, YOU DIDN’T NEED A LOT, IT’S SUPERPRECIOUS AND REALLY COMPETITIVE TO GET IT. >>THANKS FOR COMING IN. >>THANKS FOR COMING IN. >>>ELON MUSK SAT DOWN WITH THE CHAIRMAN AT THE WORLD ARTIFICIAL INTELLIGENCE IN SHANGHAI TO DEBATE THE FUTURE OF TECH AND WHETHER COMPUTERS ARE GETTING SMARTER THAN HUMANS. >>THE MOST IMPORTANT MISTAKE SMART PEOPLE ARE MAKING, ASSUMING THEY’RE SMART. THEY’RE NOT. >>I’M QUITE OPTIMISTIC, AND I DON’T THINK ARTIFICIAL INTELLIGENCE IS A THREAT, I DON’T THINK ARTIFICIAL INTELLIGENCE IS SOMETHING TERRIBLE. >>IT’S A PRETTY CIVIL DEBATE FROM WHAT WE SAW. >>DAN HALLY JOINS US LIVE FROM THE NEWSROOM WITH MORE ON THIS BACK AND FORTH AND EVEN THOUGH THESE GUYS, OBVIOUSLY, HAVE PARTICULAR STAKES IN THE WHOLE AI DEBATE, IT HAS IMPLICATIONS FOR ALL OF US. >>I MEAN THIS IS OBVIOUSLY, THE TWO POLAR OPPOSITE OF HOW AI IS BEING TREATED IN THE TECHNOLOGY COMMUNITY, YOU HAVE ELON MUSK ON ONE HAND WHICH IS THE WORLD ENDING TECHNOLOGY WHICH WE ALL FEAR. WE HAVE JACK MA, THIS COULD IMPROVE OUR LIVES, COULD MAKE THINGS EASIER FOR US. THERE’S NO REAL THREAT HERE. ELON MUSK, IT’S GOT TO BE SAID, THIS COMPANY USES ARTIFICIAL INTELLIGENCE, IT’S WHAT IS POURING THE AUTOPILOT IN TESLA’S, AND THEY USE ALIBABA USES ARTIFICIAL INTELLIGENCE. RIGHT NOW ARTIFICIAL INTELLIGENCE IS PRETTY UNIN TEN SUBSEQUENT. YOU CAN FEED IT INFORMATION AND YOU CAN HAVE IT PULLED UP LIKE ANY DATABASE WORKS. THEY’RE TRYING TO IMPROVE IT OVER TIME. WE’RE NOT LIVING IN A SITUATION LIKE ELON MUSK SAID IN THE PAST WHERE AI IS THE NEXT A BOMB OR SOMETHING LIKE THAT. IT’S TYPING CAT IN THE GOOGLE SEARCH AND PULLING UP IMAGES OF CATS. THAT’S WHERE WE ARE WITH AI AND ELON MUSK IS NOT A HUGE PROPONENT OF GIVING INTELLIGENCE THAN IT ALREADY HAS AND THE OTHER SIDE IT COULD BE A REAL IMPROVEMENT FOR MANKIND. >>DAN. >>NONE OF IT IS SHOCKING, YOU KNOW, IT’S EXCITING TO SEE THEM SHARE A STAGE, I THINK. ANY TIME THEY’LL BE TOGETHER YOU’LL HAVE PEOPLE TALKING ABOUT IT. HE’S BEEN SOUNDING THIS GONG FOR A WHILE. >>WE HEAR ALL OF THIS TYPE OF AI, AI, SHOULD ANYONE GO OUT AND LEARN HOW TO BE AN AI ENGINEER. WILL WE SEE A WAVE OF GRADUATES, IS THERE A HUGE INTEREST IN THIS? >>WE’VE JUST STARTED A MASTERS PROGRAM IN INFO MATTICS, NOT EXACTLY AI, WE’RE MOVING IN THAT INFORMATION. >>WHERE IS THAT? >>RUTGERS IN NEW BRUNSWICK. THERE ARE OPPORTUNITIES, JUST LIKE ANY TECHNOLOGY, IT HAS BENEFITS IT WILL HAVE ITS COSTS. THERE WILL BE PEOPLE WHO ARE DISPLACED, WE WILL ALSO SEE NEW JOBS BEING CREATED. I HAVE A PIECE THAT WILL BE COMING OUT FROM THE CENTURY FOUNDATION ON ROBOTICS, AND AGAIN, STILL VERY DIFFERENT APPROXIMATELY THE AI CONVERSATION, BUT STILL HAS THE POTENTIALLY THE SAME ISSUES WHERE PEOPLE ARE CONCERNED THAT ROBOTS ARE TAKING PLACE, TAKING THE JOBS. BUT, ONE OF THE CHALLENGES WITH A LOT OF THAT RESEARCH I’VE BEEN READING AND CONTRIBUTING TO, WE DON’T HAVE GOOD ENOUGH DATA, WHAT ARE THE NEW JOBS GOING TO BE CREATED. SO THAT AGAIN BECOMES VERY IMPORTANT ABOUT WHAT KIND OF TRAINING WE PROVIDE PEOPLE, AND DIRECTLY IN THOSE JOBS OR TRANSITIONS WE NEED AI TO DO THE ANALYSIS. >>>WHEN ONE GOP CENTER WANTS TO GO INTO THE POWER, AND FED BY PRESIDENT BILL DUDLEY. >>>WE’LL LOOK AT THE ACTIVELY TRADED STOCKS AND WE HAVE BANK OF AMERICA AND WE SEE BROADLY A RALLY IN BANKS. . >>>TIME FOR OUR BUDGET BEATER, LET’S GET STARTED WITH THIS, OPINION BACKLASH, THOM TILLIS, HE’S CALLING FOR A HEARING CONSIDERING DANGER APPROXIMATELY THE FEDERAL RESERVE. THIS IS FROM BILL DUDLEY EARLIER IN THE WEEK WHERE HE SAID, FED GET POLITICAL. PEOPLE DIDN’T LIKE THAT TOO MUCH. >>YEAH. >>DO YOU THINK CONGRESS NEEDS TO BE LOOKING INTO THIS? >>IT’S ALREADY POLITICAL. >>IT BECAME POLITICAL WHEN THE PRESIDENT STARTED TO CRITICIZE, BOTH PARTIES HAVE TO STEP BACK AND SIT BACK AND SAY WHAT IS THE FED’S JOB AND ROLE, IT’S MAXIMIZING ECONOMIC GROWTH, MEANWHILE MAINTAINING INFLATION. AND THAT THE PRESIDENT AND HIS ADMINISTRATION, THEY NEED TO GO TO CONGRESS AND IF THEY WANT TO DO SOMETHING ABOUT POVERTY, PEOPLE’S LOW INCOME, MOVING TO RECESSION, THE FISCAL POLICY. >>INFLATION HASN’T RISEN AS YOU SHOULD HAVE. YOU CAN PUT THAT ON THE FED, PRESIDENT TRUMP HAS TWEETED IT HAS PUT HIM IN A NO WIN SITUATION. >>IN IT FOR THE LONG TERM. STEVEN MEN YOU’VE IN IS OFFERING 15 YEAR LONG BOND. HE’S GETTING CLOSER TO DOING SOMETHING LIKE THIS. I MEAN IS THIS A GOOD IDEA FOR THE UNITED STATES? IT WILL BE A BEGAN FOR THESE PRODUCTS? IT DOESN’T SEEM LIKE FROM THE FINANCIAL INDUSTRY THERE IS. >>IT’S ANOTHER WAY OF KICKING THE CAN DOWN THE CURB, ALLOWING US TO HAVE LARGE BUDGET DEFICITS AND I THINK IT’S PROBLEM CONTINUING, RIGHT, IF WE’RE GOING TO HOLD SMALL HOUSEHOLDS, FEET TO THE FIRE, YOU NEED TO BALANCE YOUR BUDGET — >>YES. >>WE NEED TO GET BACK TO THAT POINT WHERE WE’RE PREACHING AND ACTIVELY PRACTICING FISCAL DISCIPLINE. >>THE DEFICIT KEEPS GROWING, CLOSE TO A TRILLION, AND THE 30, I DON’T KNOW HOW A 100-YEAR BOND WOULD HELP MUCH IN THE SHORT TERM. >>I DON’T EITHER. >>>ARE YOU UNDER THE AGE OF 35 AND HAPPY WITH YOUR PAYCHECK? A NEW REPORT FROM THE CONFERENCE BOARD FOUND MORE AMERICAN WORKERS UNDER 35 WERE HAPPY WITH THEIR WAGES COMPARED TO THOSE 55 AND OLDER, AND OVERALL WAGE SATISFACTION ROSE TO 46% LAST YEAR. >>IT COULD ALWAYS BE HIGHER. >>IT CAN, BUT IT’S INTERESTING, AGAIN, ANOTHER INDICATOR THAT EVEN THOUGH WE SEE WHAT APPEARS TO BE ANEMIC WAGE GROWTH OVER ALL, WHEN YOU LOOK AT A SURVEY LIKE THIS, IT IS INTERESTING TO SEE PEOPLE A LITTLE HAPPIER. >>IT SHOWS YOU THAT, RIGHT, WE CAN’T RELY ON THE AVERAGE ALL OF THE TIME. THAT YOU DO HAVE PARTS OR SEGMENTS AND POCKETS IN THE LABOR FORCE DOING WELL. THIS IS A TREND THAT THEY’VE IDENTIFIED THAT’S GOTTEN BETTER, SO A LARGE PART OF IT IS BECAUSE OF THE HIT ECONOMY, EMPLOYERS ARE STARTING TO LOOK FOR AND PROVIDE HIGHER WAGES TO ATTRACT AND RETAIN. SOMETHING I FOUND DISTURBING IN THE REPORT WAS THE LACK OF SATISFACTION FOR THOSE TYPES OF EMPLOYER INVESTMENTS IN TERMS OF IT, WHERE I’LL TREAT YOU AS AN ASSET TO BE GROOMED, RIGHT, PROMOTION POLICY. >>ALL RIGHT, SORRY, WE’LL TAKE A LAST LOOK AT THE MARKETS, WE SEE STOCKS RALLYING AT THE MOMENT. AL TREE, AFTER THE REPORT OF THE FTC IS INVESTIGATING MARKETING PRACTICES IN JUUL, AND THEY OWN SHARES IN THAT COMPANY. IT’S DOWN 3%. STICK AROUND FOR YFIPM, THAT’S NEXT. >>>IT IS 1:00 P.M. IN NEW YORK CITY AND STOCKS ARE SOARING AS TRADE TENSIONS BETWEEN CHINA AND THE U.S. APPEAR TO REACH A COOLING POINT. ON TAP FOR TODAY, HOPES FOR A TRADE DEAL IMPROVING AS CHINESE NEGOTIATORS ADMIT THAT A RATCHETING OF UP TARIFFS IS CONDUCIVE TO NO ONE. HOW THAT FRAGILE OPTIMISM IS MUCH NEEDED AS A SECOND QUARTER GDP READING SHOWS A CONTINUALLY SLOWING U.S. ECONOMY. BEST BUY BECOMING THE LATEST TO AND AND TREASURY SECRETARY WEIGHING THE IDEA OF ULTRA LONG U.S. BONDS. WHAT THE DECISION MEANS AND WHAT IT SAYS ABOUT THE STRANGE TIMES THE U.S. ECONOMY FINDS ITSELF IN NOW. ALL THAT AND MORE. THIS IS YFi PM. >>>GOOD AFTERNOON. HAPPY FRIDAY EVE. I’M ZACK GUZMAN. JOINING ME TODAY IS YAHOO FINANCE’S HEIDI CHUNG. BACK WITH THE POWER BLUE SUIT. ALONG WITH BEN KISSLE. THANK YOU FOR TAKING THE TIME. GOOD TO SEE YOU AGAIN. YOU BOTH HAVE THE BLUE JACKET VIBE GOING ON. >>YOU AS WELL. >>ALWAYS. WHILE WE START THE SHOW WE’RE SEEING STOCKS RISE TODAY ON U.S.-CHINA TRADE HOPES AS PEOPLE CONTINUALLY THINK THINGS ARE HEADED IN THE RIGHT DIRECTION AFTER CHINA’S COMMERCE MINISTRY SAYS OFFICIALS ARE QUOTE, WILLING TO RESOLVE THE ISSUE THROUGH CONSULTATION AND COOPERATION IN A CALM MANNER. INTERESTING CHOICE OF WORDS SEEING AS THAT’S WHAT PRESIDENT TRUMP WAS TALKING ABOUT HOPING THIS COULD BE RESOLVED IN A CALM MANNER. THIS COMES AS PRESIDENT TRUMP IS WEIGHING IN ON THE STATE OF NEGOTIATIONS WITH BEIJING. TAKE A LISTEN TO WHAT HE SAID ON FOX NEWS RADIO IN MORNING. >>THERE IS A TALK SCHEDULED FOR TODAY AT A DIFFERENT LEVEL. AND YEAH, THEY’VE BEEN TALKING. YOU KNOW, THE FAKE NEWS TRIED TO SAY WE WEREN’T TALKING LAST WEEK AND THEN THE VICE PREMIER OF CHINA SAID DON’T KNOW WE HAVE BEEN TALKING. >>ON A DIFFERENT LEVEL. IS THE KEY TERM USED THERE. TALKING. >>WHAT DOES THAT MEAN? >>ON A DIFFERENT LEVEL. >>WHAT THE MARKET’S SAYING RIGHT NOW, WE’RE SEEING STOCKS RISE ON THIS. AND OF COURSE CHINA AS WE NOTED OFF THE TOP SAYING THEY WANT TO SEE A RESOLUTION HERE. BUT YES, WHAT DOES DIFFERENT LEVEL MEAN? >>DIFFERENT LEVELS MEANS NOTHING TO ME. WE HEAR THIS ALL THE TIME. TIME AND TIME AGAIN. TALKS ARE GOING ON. >>RIGHT. >>OPTIMISTIC THAT SOMETHING’S GOING TO HAPPEN THEN THE MARKETS START PRICING IN A DEAL. WHEN WE GET A NEGATIVE HEADLINE WE SEE MARKETS PLUMMET AND INVESTORS START FREAKING OUT. I JUST DON’T KNOW WHAT TO MAKE OF THESE COMMENTS BECAUSE WE KEEP HEARING THIS BACK AND FORTH. I DON’T WANT TO SAY FOR TAT. WHAT IS HAPPENING BEHIND CLOSED DOORS. WHAT’S BEING DISCUSSED ON THE PHONE. WE DON’T KNOW. >>IT’S NOT JUST THE HEADLINES. IT’S A TWEET FROM DONALD TRUMP THAT CAN REALLY AFFECT THE MARKETS AS WELL. WHEN WE SAW HE MADE HIS DECAREER THAT ALL AMERICANS BUSINESSES MUST STOP DOING BUSINESS WITH CHINA. WHAT WE HAVE WITH THE CHINESE IS A MAN WHO WILL BE IN CHARGE UNTIL THE DAY HE DIES. XI JINGPING IS GOING TO BE THERE UNTIL HE IS IN THE GRAVE. THEY CAN WAIT OUT THIS TRADE WAR ON THE U.S. SIDE. ALSO THERE IS NO DENYING THE CHINESE ARE MANIPULATING THEIR CURRENCY AND LOWERING THEIR CURRENCY VALUE AND THEY’RE ALSO CIRCUMVENTING THE TARIFFS BY TRADING WITH OTHER ASIAN COUNTRIES AND GETTING AROUND IT THAT WAY. SO THERE ARE WAYS THAT THE CHINESE GOVERNMENT IS OFFSETTING THE PAIN THAT WOULD HURT THEIR PEOPLE AND THEREFORE MAKING THIS TRADE WAR NOT AS DAMAGING OR AS DETRIMENTAL TO THEIR ECONOMY AS IT COULD BE. I AM HESITANT TO SAY THIS IS SOMETHING THE U.S. CAN REALLY WIN IN THE LONG TERM. GIVEN THE FACT THAT XI IS GOING TO BE THERE FOREVER. >>IT’S A GOOD POINT. A LOT OF THE HEADLINES HAS BEEN ON THE OPTIMISM. BOTH OF THESE LATEST UPDATES PRESENT. A LOT OF THAT MIGHT JUST BE BECAUSE THE MARKET WAS STARVED FOR SOME POSITIVE OPTIMISM AT LEAST TRYING TO TEASE THIS OUT. IMPORTANT TO NOTE HERE. YAHOO FINANCE TRANSLATED CHINA’S COMMENTS. OFFICIALS DID NOT SAY IT WOULDN’T RETALIATE. HERE’S THE DIRECT TRANSLATION. CHINA STILL HAS SUFFICIENT MEANS TO RETALIATE WHAT SHOULD BE DISCUSSED NOW IS THAT THE U.S. MUST CALL OFF ITS PLAN TO IMPOSE ADDITIONAL TARIFFS ON $550 BILLION WORTH OF CHINESE PRODUCTS TO AVOID A FURTHER ESCALATION IN THE TRADE DISPUTE. MAKING SOLEMN REPRESENTATIONS TO THE U.S. BUT OF COURSE THIS KIND OF HINGES ON THE FACT THEY’RE PUSHING FOR PRESIDENT TRUMP TO REMOVE THOSE TARIFFS. WE’VE SEEN NO INDICATION THAT THAT WILL BE THE MOVE THAT THE U.S. CHOOSES TO EMPLOY HERE. >>I HAVE NO IDEA WHAT’S GOING TO HAPPEN. I SAY THE SAME THING OVER AND OVER AGAIN. WE HAVE NO IDEA WHAT’S GOING TO HAPPEN. IS THE ROUND OF TARIFFS THAT’S SUPPOSED TO GO INTO PLACE GOING TO GO INTO PLACE? THAT WOULD AFFECT RETAILERS AND CONSUMERS. I WISH I HAD AN ANSWER FOR YOU GUYS. >>THE ONLY THING WE HAVE IS AN EXAMPLE OF TARIFFS. GEORGE W. BUSH ATTEMPTED TO PUT TARIFFS IN PLACE AND IT LASTED ABOUT THREE MONTHS BEFORE THE ECONOMY WAS LIKE NO, DUDE, SORRY, WE’RE NOT GOING TO DEAL WITH ALL THIS AND HE BACKED OFF. THAT’S THE ONLY EXAMPLE IN RECENT HISTORY WE HAVE OF HOW TARIFFS DIDN’T WORK IN THE UNITED STATES. QUITE FRANKLY DONALD TRUMP’S ECONOMIC PLAN WHERE HE SAYS YES THE AMERICAN PEOPLE WILL SUFFER, HE KNOWS WE WILL SUFFER. THAT’S WHY HE’S DELAYING UNTIL AFTER THE HOLIDAY BREAK BECAUSE HE DOESN’T WANT TO GET PEOPLE UPSET WHEN THEY CAN’T BUY CHRISTMAS PRESENTS. HE UNDERSTANDS THAT WE’RE GOING TO SUFFER. BUT THEN IT’S THIS WHOLE NOTION OF YEAH, WE’RE GOING TO SUFFER, SURE, BUT THE CHINESE ARE GOING TO SUFFER WORSE. I’M SITTING HERE THINKING, WHAT IF NEITHER OF US HAVE TO SUFFER. THAT WOULD ALSO WORK. >>THAT’S WHAT WE’RE SEEING CHINA SAY. IT’S CONDUCIVE TO NO ONE. SO WE SHOULD PROBABLY WORK ON GETTING THESE TARIFFS TAKEN OFF, AT LEAST THAT’S THE MESSAGE FOR NOW. I DON’T THINK ANYONE BLAMES YOU FOR NOT KNOWING WHERE WE’RE GOING. A LOT OF PEOPLE EVEN WITHIN THESE DISCUSSIONS ALSO DON’T KNOW WHERE THEY’RE GOING BECAUSE THEY THINK THEY HAVE A DEAL IN PLACE ONLY TO SEE IT TAKEN OFF THE TABLE. THE TRADE DISCUSSIONS ARE COMING AS SECOND QUARTER GDP WAS REVISED DOWN TO 2% FROM IT ITS ORIGINAL 2.1% PACE ESTIMATED LAST MONTH. THAT DOWNWARD REVISION WAS IN LINE WITH EXPECTATIONS SO A BIT OF GOOD NEWS ON THAT FRONT. PRESIDENT TRUMP SEEMS TO BE HAPPY WITH THE STATE OF THE ECONOMY OVERALL. HE WROTE ON TWITTER SAYING THE ECONOMY IS DOING GREAT WITH TREMENDOUS UPSIDE POTENTIAL. IF THE FED WOULD DO WHAT THEY SHOULD WE ARE A ROCKET UPWARD. >>I’M SO SICK OF THESE FED TWEETS, HONESTLY. HOW MANY MORE? HOW MANY DIFFERENT VARIATIONS OF THE SAME TWEET? JUST BACK TO YOUR POINT ON THE GDP. CONSUMER SPENDING IS WHERE WE’RE SEEING THE STRENGTH. THAT ACCOUNTS FOR TWO-THIRDS OF ECONOMIC OUTPUT. THE CONSUMER IS STRONG. THEY’RE SPENDING AT THE WALMARTS AND THE TARGETS AS WE’VE SEEN. BUT WE’RE STARTING TO SEE CONSUMER SENTIMENT FALL SLIGHTLY. WE SAW THAT IN AUGUST. WILL THEY BE ABLE TO KEEP UP THAT STRONG MOMENTUM? THAT’S THE NEXT QUESTION GOING INTO THE NEXT QUARTER, AS WELL AS WE GET THE JOBS NUMBERS ON FRIDAY. SO THAT WILL ALSO BE A GOOD READ ON THE LABOR MARKET AS WELL. >>YEAH. WHEN IT COMES TO DONALD TRUMP SORT OF KISSING DISSING ON THE FED. THAT PLAYS INTO THE LIBERTARIAN BASE. THE FED HAS BEEN THE FOCUS OF IRE FOR MANY YEARS FROM YOUR MORE RON AND RAND PAUL LIBERTARIAN-MINDED PEOPLE. I THINK HE’S JUST SORT OF ATTEMPTING. THOSE WORDS ARE AS SHALLOW AS A KIDDY POOL REALLY WHEN IT COMES TO ACTUALLY TAKING ON THE FED. BUT I THINK HE’S DOING IT TO PLACATE A BASE THAT PERHAPS HASN’T FELT AS IF HE’S BEEN AS LIBERTARIAN AS THEY WOULD HAVE LIKED. >>FOR SURE. WE’LL DIG DEEPER INTO THAT KIDDY POOL NO MATTER HOW SHALLOW IT MAY BE. BUT HEIDI, YOU MENTIONED PEOPLE SPENDING AT TARGET AND WALMART. ONE PLACE IT LOOKS LIKE THEY MAY HAVE BEEN SPENDING LESS WAS BEST BUY. BEST BUY IS NOW TUMBLING. YOU CAN SEE THAT STOCK OFF 9% AFTER MISSING TOP LINE EXPECTATIONS. THE COMPANY POSTING ADJUSTED EARNINGS OF $1.03. $9.54BILLION THERE AS YOU CAN SEE ON THAT BREAK DOWN CHART. INTERESTING QUARTER. BEST BUY ALSO BLAMING THE PLANNED U.S. TARIFFS ON CHINESE IMPORTS FOR LOWERING ITS TOP LINE FORECAST FOR THE REST OF THE YEAR. AS WELL AS KIND OF NOT KNOWING TALKING ABOUT A STRONG CONSUMER. NOT KNOWING HOW IT’S GOING TO HOLD UP IN THE BACK HALF OF THE YEAR. >>BEST BUY ALWAYS HAS A STRONG HOLIDAY QUARTER. WITH THOSE LOOMING TARIFFS WE HAVE NO IDEA. THE COMPANY ALSO DOESN’T HAVE ANY IDEA WHAT’S GOING TO HAPPEN IN TERMS OF THE COST THAT THEY’RE GOING TO HAVE TO PASS OFF TO CONSUMERS. THEY SAID THEY WANT TO STAY A COST COMPETITIVE WITH THEIR RIVALS BUT THEY HAVE NO IDEA WHAT’S GOING TO HAPPEN. THEY SOURCE ABOUT 60% OF THEIR PRODUCTS FROM CHINA. THEY’RE HOPING TO LOWER THAT TO ABOUT 40% IF THEY MOVE SUPPLY CHAINS. >>GOOD LUCK. >>OUT INTO OTHER COUNTRIES LIKE VIETNAM AND SO FORTH. WHENEVER WE HEAR THE WORD TARIFFS COME UP FROM MANAGEMENT, IN ANY EARNINGS SITUATION ON THE CALL OR IN A REPORT, WHATEVER IT MAY BE. >>YEAH. >>INVESTORS FREAK OUT. THIS MOVE, I THOUGHT WAS QUITE LARGE. >>IT’S LARGE BUT NOT EVEN TARIFFS. IN STORE SALES GROWTH GREW 1.6% COMPARED WITH WITH EXPECTATIONS >>NO ONE GOES THERE TO BUY VIDEO GAMES ANY MORE. ú>>RIGHT LET’S NOT FORGET THE IMPACT THAT AMAZON HAS HAD ON PLACES LIKE BEST BUY. AMAZON IS NOW DOING OVER HALF OF ALL INTERNET SALES ARE GOING THROUGH AMAZON. SO THEY’RE REALLY GETTING IT FROM A COMPETITOR STANDPOINT AND FROM THE TARIFF STANDPOINT. SO YEAH, BEST BUY IS IN A TOUGH SPOT RIGHT NOW. >>WE’VE SEEN OTHER RETAILERS HOLD UP THOUGH. >>LIKE WALMART AND TARGET. >>WALMART IS EVERYTHING YOU NEED IN ONE STOP. WE GOT A MACHETE, WE GOT EVERY BIT OF FOOD WE NEEDED, WE GOT CAMPING EQUIPMENT, EVERYTHING WE COULD HAVE WANTED. AT BEST BUY YOU CAN GET WHAT,. >>REMEMBER THEY’RE LAUNCHING THEIR FITNESS LINE IN BEST BUY STORES TO DRIVE MORE TRAFFIC. WE’LL SEE. >>STRONG ENOUGH. >>IF NAY CAN DIFFERENTIATE THEMSELVES. >>WHEN I THINK FITNESS I THINK BEST BUY. >>SOUNDS LIKE YOU’RE IN THE CAMP SENDING THE STOCK LOWER TODAY. IT’S A TOUGH DAY FOR BEST BUY. I WANT TO TOUCH MORE ON THE IDEAS THAT THE FED IS BEING TARGETED HERE AS WELL AS OTHER LEVERS THAT THE U.S. CAN PULL TO HELP SUPPORT THE EXPANSION WE’RE SEEING RIGHT NOW. TREASURY SECRETARY STEVE MNUCHIN IS MULLING ULTRA LONG BONDS. MNUCHIN SAYS SUCH A MOVE IS UNDER SERIOUS CONSIDERATION AND QUOTE, IF THE CONDITIONS ARE RIGHT THEN I WOULD ANTICIPATE WE’LL TAKE ADVANTAGE OF LONG TERM BORROWING AND EXECUTE ON THAT. JOINING US WITH MORE IS BRIAN CHEUNG. AND BRIAN, WHEN WE LOOK AT THIS. IT’S KIND OF MORE EMBLEMATIC ACTIVITY WEIRD TIMES WE’RE IN. WE HAVEN’T SEEN THE IDEA OF A 100 YEAR BOND ISSUED. >>CAN YOU IMAGINE WHAT YOUR LIFE IS GOING TO LOOK LIKE 100 YEARS FROM NOW? WHY WOULD INVESTORS INVEST IN THIS? THE QUESTION AT THE CENTER OF ALL OF THIS IS JUST THE CRAZY DEMAND WE’VE SEEN IN U.S. BONDS. SO YIELDS ACROSS THE BOARD HAVE COME DOWN OVER THE PAST FEW YEARS WHEN YOU LOOK AT THE TWO YEAR, THE TEN YEAR, WHEN YOU LOOK AT THE 30 YEAR, WHICH JUST INVERTED BELOW THE THREE MONTH YESTERDAY. SO THERE’S A LOT OF IN FLOWS COMING IN, WHICH IS KIND OF RAISING THE QUESTION FOR STEVE MNUCHIN IF THEY WERE TO MINT A 100 YEAR BOND, MAYBE THERE’D BE DEMAND FOR IT AS WELL. WHEN YOU CONSIDER QUESTIONS FOR WHY THE GOVERNMENT WOULD WANT TO DO SOMETHING LIKE THIS. WE’RE AT ABOUT A TRILLION DOLLARS OF GOVERNMENT DEFICIT. WE WANT TO TRY TO PLUG THAT GAP. MAYBE ISSUING MORE BONDS WOULD HELP THE U.S. PAY ITS BILLS. >>I ONLY SAW A 50 YEAR NOTE IN 1911. >>THEY DID ISSUE THAT. WE HAVEN’T SEEN A 100 YEAR BOND. IN OTHER COUNTRIES IT HAS BEEN A THING. AUSTRIA ISSUED A 100 YEAR BOND. GERMANY ISSUED ITS 30 YEAR BONDS AT A NEGATIVE YIELD. SO PEOPLE ARE PAYING TO HOLD ON TO GERMAN GOVERNMENT DEBT. SO IN THE U.S. WHERE THE DEMAND IS SO HIGH IT’S NOT INCONCEIVABLE WE MIGHT SEE PRESSURES TO THE POINT WHERE PEOPLE MIGHT BE WILLING TO TRADE ON THE SECONDARY MARKET AT NEGATIVE YIELDS OR MAYBE BUY UP A 100 YEAR BOND. >>HOW LIKELY IS IT THEY DO ROLL THIS OUT THOUGH? >>IT’S PRETTY UNLIKELY. YOU HAVE TO BE CAREFUL ABOUT SOME OF THESE HEADLINES. I THINK IT WAS A WEEK AGO OR TWO WEEKS WHERE WHERE THE U.S. TREASURY HAD ISSUED A SURVEY TO LOOK AT PARTICIPANTS, ASKING WHAT THEIR INTERESTS WOULD BE. THIS IS NOT MEANING THEY’RE GOING TO ISSUE ONE. THEY’VE HAD THIS QUESTION ON SURVEYS IN YEARS PAST BUT IT’S JUST GAUGING NOT OFFICIALLY WHAT THE MARKET KIND OF APPETITE FOR SOMETHING LIKE THIS WOULD BE, BUT JUST GETTING A LITTLE BIT OF A THUMB ON THE PULSE OF HEY IF WE WERE TO ISSUE SOMETHING LIKE THIS WOULD IT BE FEASIBLE. MNUCHIN SAYING IT’S A POSSIBILITY. I THINK IT’S JUST THAT. IT’S A POSSIBILITY BUT I WOULDN’T BE WAITING EXPECTING THIS 100 YEAR BOND TO DROP AT ANY POINT. >>YEAH. WHILE WE’RE TALKING ABOUT THINK WANT TO SHIFT TO THE FED. NOT THAT 100 YEAR BONDS AREN’T SEXY. >>THAT’S ONE WAY TO DESCRIBE THEM. >>A LITTLE MORE HOT THESE DAYS IS THE WAY PRESIDENT TRUMP’S BEEN COMING AFTER THE FED. REPUBLICAN SENATOR THOM TILLIS IS ALSO CALLING FOR THE SENATE BANKING COMMITTEE TO INVESTIGATE THE FED’S INDEPENDENCE AFTER FORMER FED OFFICIAL BILL DUDLEY WROTE AN OP-ED CALLING ON THE CENTRAL BANK TO NOT ENABLE PRESIDENT TRUMP. ALSO PUTTING THESE VIEWPOINTS OUT THERE. BRIAN, WHERE DOES THIS PUT THE DEBATE RIGHT NOW AT FED INDEPENDENCE? >>WELL THIS IS KIND OF FASCINATING BECAUSE EVERYONE’S GOT AN OPINION ON THE DUDLEY OP- ED. SEEMS NO ONE IS SIDING WITH HIM IN THE SUGGESTION THAT THE FEDERAL RESERVE SHOULD BE GUIDING ITS POLICY TO STEER THE 2020 ELECTION. I THINK MOST PEOPLE WOULD AGREE THAT THAT LAST PARAGRAPH WAS BAD. THERE’S NOTHING IN THE FED MANDATE THAT SAYS THEY SHOULD BE DOING ANYTHING OF THE SORT IN TERMS OF STEERING WHERE ELECTIONS GO. AT THE LARGER POINT WAS HEY, THE FEDERAL RESERVE SHOULD BE PAYING ATTENTION TO WHAT’S HAPPENING IN POLITICS BECAUSE IT PRESENTS HEAD WINDS TO WHAT THE FED’S MANDATE IS WHICH IS EMPLOYMENT AND STABLE PRICES. HIS ARGUMENT BEING IF THE FED WERE TO CONTINUE TO LOWER RATES IT WOULD ENABLE PRESIDENT TRUMP TO RATCHET UP THE TARIFF WAR, WHICH WOULD CREATE A FEEDBACK LOOP THAT WOULD SPILL INTO MORE NEGATIVE CHANGES TO THE ECONOMY THAT THE FED WOULD NEED TO FURTHER LOWER RATES FOR. I THINK DUDLEY’S POINT IS SALIENT IN THAT FED OFFICIALS PROBABLY ARE THINKING ABOUT, THEY ARE THINKING ABOUT THE IMPACT OF TRADE ON THEIR CURRENT POLICY. WHETHER OR NOT THEY’RE ATTRIBUTING THAT TO PRESIDENT TRUMP AND THE WHITE HOUSE ITSELF IS SOMETHING THEY DON’T TOUCH ON WHEN THEY HAVE PUBLIC SPEECHES. I FACED THIS WHEN I TALKED TO THEM OFF CAMERA. THE PROBLEM HERE IS THAT HOW DO YOU SEPARATE THESE TWO THINGS. WE’RE PAYING ATTENTION TO WHAT’S GOING ON IN THE TRADE WAR. WE DON’T WANT TO PAY ATTENTION TO WHAT’S HAPPENING IN THE WHITE HOUSE. WELL, THE TRADE ISSUES ARE COMING FROM IT THE WHITE HOUSE. IT’S KIND OF A CHICKEN OR THE EGG QUESTION. >>RIGHT NOW IT’S CLEARLY OBVIOUS THAT A LOT MORE PEOPLE ARE TALKING ABOUT SOMETHING THAT WAS JUST KIND OF ASSUMED A NO TOUCH SITUATION WHEN WE TALK ABOUT THE FED IS APOLITICAL AND LEAVE THAT BE. NOW THAT PRESIDENT TRUMP HAS OPENED THIS CAN OF WORMS IT CONTINUES TO BE SOMETHING TALKED ABOUT. >>APOLITICAL. EVERYTHING SEEMS TO BE POLITICIZED THESE DAYS. IN A CONFIDENCE-BASED ECONOMY THE FED DOES HAVE TO BE AWARE OF THE POLITICAL ENVIRONMENT IN WHICH THEY’RE PLAYING IN. SO IT WOULD BE SORT OF NAIVE, I SUPPOSE TO THINK THEY ARE APOLITICAL AND THEY’RE JUST KEEPING THEIR HEAD IN THE SAND LIKE AN OSTRICH WHEN IT COMES TO WHAT’S GOING ON GLOBALLY AND DOMESTICALLY. I SUPPOSE IT SHOULDN’T BE A SURPRISE WHEN WE HEAR THIS INFORMATION COMING OUT THAT THE FED DOES HAVE POLITICAL MOTIVATIONS. >>TO THAT POINT. APOLITICAL, IT’S NOT SO CLEAR ABOUT WHETHER OR NOT THAT’S A GOOD OR BAD THING FOR THE FED. IMAGINE FEDERAL RESERVE THAT’S PAID NO ATTENTION TO WHAT’S GOING ON WITH TRADE AT ALL. MAYBE THE FED’S POLICY REALLY WOULD EXACERBATE WHAT THE ECONOMIC EFFECTS OF THIS TARIFF WAR HAVE BEEN BECAUSE MAYBE THEY’RE NOT SOFTENING THE BLOW FOR CONSUMERS AND PRODUCERS AND RETAILERS AND MANUFACTURERS AROUND THE COUNTRY THAT ARE REALLY SEEING THE MATERIAL IMPACTS OF THIS. >>CAN’T OPERATE IN A VACUUM. NEVER WORKS THAT WAY. BRIAN CHEUNG, THANK YOU SO MUCH. APPRECIATE IT. >>>WE’RE ALSO WATCHING APPLE SHARES TODAY AS YAHOO FINANCE CONFIRMS THE TECH GIANT IS SENDING INVITATIONS FOR A SEPTEMBER 10th EVENT. THE COMPANY IS WIDELY EXPECTED TO REVEAL NEW iPHONE MODELS AT THAT EVENT. WE’RE SEEING SHARES RIGHT NOW IN THE GREEN ON WHAT’S A GREEN DAY FOR THE OVERALL MAJOR INDICES ON THIS FINE, FINE THURSDAY. COMING UP, MORE HOOPS TO JUMP THROUGH FOR ALL VAPORS OUT THERE. HOW JUUL LABS IS STEPPING UP ITS AGE VERIFICATION TECHNOLOGY AS MORE THAN ONE IN FIVE HIGH SCHOOLERS REPORTS HAVING VAPED IN THE LAST YEAR. >>>BIG CHANGES COMING TO MARRIOTT’S SMALLEST AMENITIES. WHY YOUR HOTEL SHOWER JUST GOT LESS FUN WHEN YFi PM RETURNS. >>>WELCOME BACK TO YFi PM. THE MARKETS RIGHT NOW ARE IN RALLY MODE AS TRADE TENSIONS APPEAR TO BE COOLING. YOU CAN SEE THE DOW UP 345 POINTS. S&P UP ABOUT 38. NASDAQ LEADING THE WAY HIGHER UP MORE THAN 1.5%. >>>JUUL IS REPORTEDLY UNDER INVESTIGATION AS THE FTC IS LOOKING INTO WHETHER THE E- CIGARETTE COMPANY ENGAGED IN MISLEADING MARKETING PRACTICES, ACCORDING TO THE WALL STREET JOURNAL. THE COMPANY IS BACKED BY ALTRIA AND SHARES RIGHT NOW IN ALTRIA ARE SINKING ON THE NEWS. YOU CAN SEE THAT AS THE NEWS BROKE. LOWER BY ABOUT 3.5%. OF COURSE A LOT OF ATTORNEY GENERALS ACROSS THE COUNTRY HAVE BEEN LOOKING AT JUUL LABS FOR THEIR MARKETING PRACTICES BECAUSE OF THE WAY A LOT OF PEOPLE CLAIM THEY’VE BEEN TARGETING UNDERAGE USERS. AT A TIME WHERE WE SEE ONE IN FIVE HIGH SCHOOLERS NOW VAPING. >>REFRESH MY MEMORY. DIDN’T THEY ALREADY TAKE MEASURES TO REMOVE THE ADS FROM SOCIAL MEDIA? THEY’VE TAKEN MEASURES TO, YOU KNOW. >>THEY HAVE. >>STOP DOING WHAT THEY WERE DOING. >>THE COMPANY TOOK DOWN THEIR SOCIAL MEDIA PAGES. A LOT OF PEOPLE SAY THAT DOESN’T HELP CONSIDERING THE FACT YOU’VE BUILT YOUR COMPANY UP INTO A, YOU KNOW, WE’RE TALKING ABOUT A COMPANY THAT IS HUGE. ALTRIA PUT IN MORE THAN $10 BILLION TO GET THEIR STAKE IN THIS COMPANY. >>I THINK THAT NUMBER IS LOW. ONE IN FIVE HIGH SCHOOLERS VAPING. I DON’T THINK IT’S REALLY THAT BAD OF A SITUATION. ALSO ON THE FLIP SIDE OF THIS, I HAVE MANY FRIENDS WHO WERE SMOKING TWO PACKS OF CIGARETTES A DAY, REALLY ADDICTED TO NICOTINE AND THE VAPE, JUUL REALLY DID HELP THEM KICK TOBACCO. AND IT’S HELPED THEM AND AS A FRIEND OF THOSE PEOPLE THAT MAKES ME EXTREMELY HAPPY. I THINK IT’S A LITTLE DISINGENERAL YOU WOWS FOR THEM TO BE GOING AFTER JUUL FOR TRYING TO MARKET TO MINORS. IF YOU’RE GOING TO GO AFTER EVERYTHING THAT’S BAD FOR CHILDREN THAT MARKETS TO CHILDREN, WELL GOOD-BYE EVERY SINGLE SUGARY CEREAL, GOOD-BYE THE VAST MAJORITY OF McDONALD’S ADS I MEAN CHILDHOOD OBESITY IS A MUCH LARGER ISSUE THAN CHILDHOOD VAPING. SO I’M NOT EXACTLY CERTAIN WHY THEY THINK THAT JUUL NEEDS TO BE IN THE CROSS HAIRS HERE. >>THAT’S KIND OF THE POSITION THE FDA IS CAUGHT IN HERE TOO. THEY HAVEN’T OUTRIGHT BANNED THESE THINGS. THEY WANT TO SEE PEOPLE WHO ARE SMOKERS TURN TO A MORE HEALTHY ALTERNATIVE. ON THE FLIP SIDE THEY HAVE SAID IT IS AN EPIDEMIC WHEN YOU LOOK AT THE TICK HIGHER. PERHAPS NOT BECAUSE IT’S ONLY MORE THAN ONE FIFTY OF HIGH SCHOOLERS VAPING, BUT THAT THE TREND HAS COME UP SO QUICKLY. WE HAVE SEEN JUUL STEP UP TO TRY TO KEEP ITS, THAT REQUIRES EACH CUSTOMER TO SCAN A DRIVER’S LICENSE OR EQUIVALENT I.D. TO ENSURE JUST MYRRHS ARE AT LEAST OF AGE. IT LIMITS PURCHASES TO ONE E- CIG OR PODS PER USE. THE COMPANY SAID IT WOULD BE PUTTING UP $100 MILLION TO INCENTIVIZE THE CHANGE AND COVER ANY SALES HITS RETAILERS MIGHT SEE. ANY RETAILERS THAT DIDN’T ADOPT THE NEW SYSTEM BY 2021 WILL NO LONGER BE ALLOWED TO SELL JUUL PRODUCTS. RETAILERS THAT HAVE SIGNED ON, SO WE’LL SEE WHAT HAPPENS TO THE OTHER RETAILERS. >>I LOVE THESE OLD PEOPLE MAKING THESE NEW POLICIES AS THEY SMOKE THEIR CIGARS, DRINK THEIR WHISKEY. I THINK IT’S JUST AN INDICATION THAT JUULS ARE RELATIVELY NEW AND PEOPLE NEED A NEW CAUSE TO PRETEND AS IF IT THEY’RE PROTECTING THE YOUTH. WE WERE ALL YOUNG AND I GUARANTEE YOU THEY WILL FIND SOMETHING TO DO. >>THEY WILL. >>THAT WILL HARM THEIR BODIES. >>TIDE PODS. >>EXACTLY. THIS IS A HECK OF A LOT BETTER THAN THE TIDE POD FIASCO GOING ON. I REALLY THINK IF THEY COULD USE THIS, I DO THINK THE NET, JUUL HAVE BEEN A NET POSITIVE FOR SOCIETY. >>THEY’RE CAUGHT IN THAT WEIRD SPOT. AT LEAST IN THEIR ACTIONS SO FAR. FTC SAYING WE NEED TO LOOK AT JUUL’S MARKETING PRACTICES. POSSIBLY BECAUSE THIS COMPANY HAS GOTTEN SO BIG THAT NOW THE TARGET ON ITS BACK HAS TO BE BIGGER. >>MAYBE THEY WANT A LITTLE BIT OF THAT MONEY. GET THAT REVENUE THROUGH. THERE’S ALWAYS HANDS COMING THROUGH THE MONEY POT. IF YOU LOOK AT CHILDHOOD, TEENAGE CIGARETTE USE IT’S 75% SINCE 1997. YOU HAVE TO BE CAREFUL. WE’RE STARTING TO HEAR ABOUT PEOPLE GETTING POPCORN LUNG AND DISEASES AFFILIATED. I BELIEVE THERE WAS 250 CASES SO FAR REPORTED. >>SEIZURES. >>YOU’RE STILL PUTTING A CHEMICAL IN YOUR BODY. >>QUICKLY, YOU SAID THAT A LOT OF YOUR FRIENDS THAT USED TO SMOKE CIGARETTES ARE BENEFITING. THE CONCERN IS PEOPLE WHO HAVE NEVER SMOKED BEFORE, PEOPLE WHO DIDN’T CONSIDER SMOKING ARE PICKING UP JUULS AND VAPING. I THINK THAT’S WHERE THERE’S CONCERN. >>BIG NICOTINE. THEY WANT TO KEEP PEOPLE ON THAT DRUG. THERE’S A TRUE. >>THAT’S THE INTERESTING PART. ALTRIA, BIG TOBACCO COMPANY INVESTING IN JUUL AS WELL. THEY SEE THE TRENDS ARE SHIFTING TOWARDS THERE. THEY WANT A PIECE OF THAT AS WELL. IF YOU ARE A VAPOR AND LIKE TO STAY IN HOTELS, TODAY IS A BRUTAL DAY. SAY GOOD-BYE TO THE TINY SHAMPOO BOTTLES THAT MARRIOTT OFFERS. THE COMPANY WILL BE REMOVING SMALL PLASTIC BOTTLES OF SHAMPOO, CONDITIONER AND BODY WASH FROM ITS HOTEL ROOMS BY DECEMBER OF 2020. IT WILL BE REPLACED WITH WALL DISPENSERS OR LARGER BOTTLES, DEPENDING ON THE HOTEL. GUYS, MANY ENVIRONMENTAL GROUPS ARE CHEERING THE MOVE. I FOR ONE AM SAD. THOSE ALWAYS MADE MY STAY FUN. >>AS A HUMAN BEING I’M GLAD THEY’RE TAKING THESE, MAKING THESE MOVES IN ORDER TO MAKE SURE THAT WE’RE BEING ENVIRONMENTALLY CONSCIOUS AND BETTER HUMAN BEINGS, BUT AS A CONSUMER WHO STAYS IN THESE HOTELS AND SOMETIMES THE NICER HOTELS HAVE NICER PRODUCTS AND HONESTLY I THINK THE MAIN CONCERN IS THAT A LOT OF THE PLASTIC DOESN’T GET RECYCLED. THE STUFF I TAKE I USE THE CONTAINERS OVER AGAIN. >>YOU’RE A STEALER. >>I PAY FOR THAT WITH MY RATES. >>ALL RIGHT. >>IT’S A RESORT FEE RIGHT THERE. THIS IS WHAT MARRIOTT. >>BAG FULL OF TOWELS. TAKING LINENS WITH YOU. >>PILLOWS. >>THAT’S ACTUALLY. >>OH SURE. YEAH. POT CALLING THE KETTLE BLACK. MARRIOTT VP OF SUSTAINABILITY SAYS MORE AND MORE PEOPLE HAVE A GENERAL CONSCIOUSNESS. THEY DON’T WANT TO BE LEAVING HALF EMPTY BOTTLES. MY POINT WOULD BE I’M TAKING THE BOTTLES. NO HALF EMPTY BOTTLES BEING LEFT BEHIND. >>I’M HORRIBLE WITH SINGLE USE PLASTICS. I GO THROUGH EIGHT WATER BOTTLES A DAY. I’M JUST WALKING THROUGH NEW YORK CITY CONSTANTLY GETTING A WATER BOTTLE AND THROWING IT AWAY 30 SECONDS LATER. I THINK THIS IS A GOOD STEP FORWARD. WE’RE SEEING WHAT’S HAPPENING WITH THE ENVIRONMENT. THE POLLUTION, THE PLASTICS IN THE OCEAN. SO THIS IS, IT’LL BE FINE. >>OVERALL A STEP FORWARD. >>WORTH A PAT ON THE BACK. >>I DON’T KNOW. THE IDEA YOU HAVE THE LARGE SHAMPOO CONTAINERS THAT SOMEONE ELSE MAY HAVE TOUCHED. >>I JUST WANT TO MAKE SURE YOU CAN’T OPEN THOSE. >>THAT’S WHAT I’M SAYING. >>THERE NEEDS TO BE A LOCK AND A KEY. I DON’T WANT ANYONE DOING. >>THAT’S WHAT I’M SAYING. >>FOLKS ARE WEIRD, MAN. >>NEVER TRUST. >>>AMAZON MAY HAVE TAKEN A PGE FROM THE MEAN GIRLS MOVIE. THE WALL STREET JOURNAL REPORTS THE TECH COMPANY KEPT A BURN BOOK DETAILING ALL THE NEGATIVE COMMENTS FROM NEW YORK POLITICIANS AND CITY OFFICIALS BEFORE AXING ITS PLANS TO BUILD A SECOND HQ IN LONG ISLAND CITY. IT WAS REPORTEDLY KEPT IN A MICROSOFT WORD DOCUMENT CALLED QUOTE, NEW YORK NEGATIVE STATEMENTS. I DON’T KNOW. >>AMAZON. >>I DON’T KNOW IF IT’S A GOOD THING TO HAVE THIS IN A MICROSOFT WORD DOC. >>SO UNSECURE. THAT’S THE FUNNIEST PART. I THOUGHT IT WAS GOOGLE DOC. I DON’T THINK IT’S ALL THAT SURPRISING THAT THEY WERE KEEPING A RECORD OF WHAT THE COMPLAINTS WERE IN THE COMMUNITY AND FROM POLITICIANS. I THINK THAT’S A GOOD THING TO NOTE; RIGHT? AS A COMPANY THAT’S LOOKING TO MOVE INTO THIS MAJOR CITY. YOU WANT TO KNOW WHAT THE PEOPLE IN THE COMMUNITY ARE THINKING AND WHAT THEIR COMPLAINTS ARE. >>YEAH. >>DO YOU MEAN TO TELL ME A MULTIBILLIONAIRE CEO HAS SPITE IN THEIR HEART AS MOTIVATION AGAINST POLITICIANS? I CAN’T BELIEF THAT. A BUSINESSMAN WHO HATES POLITICIANS? IT IS LIKE THE LEAST CLEVERLY NAMED WORD DOC. THAT’S THE ONLY THING I WOULD SAY. IF YOU DON’T WANT PEOPLE TO FIND IT. >>WHAT WAS THE TERM FOR IT? >>BURN BOOK. THE BURN BOOK. >>NO. IT WAS CALLED SOMETHING ELSE. ANYWAYS, I’LL REMEMBER IT. >>NEW YORK NEGATIVE STATEMENTS. THAT’S IT. THAT’S IT. >>THAT’S IT. WHEN IT COMES TO AMAZON, I MEAN THE FACT OF THE MATTER IS THEY NEED TO BE PAYING TAXES. THAT’S WHERE THE MAJOR TURNOFF WAS WHEN THEY GOT THAT HUGE, THEY WOULD HAVE JUST GOTTEN MASSIVE AMOUNTS OF INCENTIVES. >>I LIVE THERE SO I WAS WORRIED ABOUT. >>YOU KNOW HOW THAT WOULD RIPPLE ACROSS. >>WE HAD STATE SENATOR ON THE SHOW BEFORE. HE WAS ON HERE AND HE WAS THE MOST TALKED ABOUT POLITICIAN IN THAT BURN BOOK. >>HE HAD A LOT TO SAY. >>HE WAS OUTSPOKEN AGAINST THE MOVE. HE WAS ONE OF THEIR MOST VOCAL OPPONENTS. NOT SURPRISING TO SEE HIS NAME POP UP. >>JEFF BEZOS IS LIKE STEVE BUSCHEMI IN BILLY MADISON. GOOD THING I CALLED THAT GUY. HE HAS NAMES HE WANTS TO CROSS OFF THAT WRONGED HIM. >>NONETHELESS, AMAZON STILL NOT COMING TO NEW YORK. YOU CAN HAVE YOUR BURN BOOK. >>>THIS WEEK ON INFLUENCERS, ANDY SERWER SITS DOWN WITH THE CEO OF BETA WORKS. THE FUTURE OF SMART HOME DEVICES TO REGULATIONS IN SILICON VALLEY. LET’S WATCH. >>SHOULD THESE COMPANIES BE BROKEN UP? >>PEOPLE ARE TALKING ABOUT BREAKUP. >>WHAT DO YOU THINK ABOUT THAT? >I THINK THE POST WAS THOUGHTFUL AND ARTICULATE. VERY CLEAR THAT THIS WAS JUST HIM, HE THOUGHT ABOUT THIS FOR A LONG TIME. I THINK HIS ARGUMENT IS COMPELLING BUT I DON’T THINK IT’S SUFFICIENT. I THINK JUST TAKING FACEBOOK AND INSTAGRAM AND WHATSAPP AND BREAKING THEM UP, INSUFFICIENT. YOU STILL HAVE THIS INCREDIBLE BASE OF DATA IF YOU TAKE YOUTUBE OUT OF GOOGLE YOU STILL HAVE THIS BASE OF DATA WITHIN THESE COMPANIES. YOU’LL STILL HAVE MANY OF THE SAME PROBLEMS. >>YOU CAN CATCH THE FULL EPISODE ON YAHOO FINANCE. >>>LET’S CHECK IN WITH SCOTT GAMM AS WE CONTINUE TO SEE THE MAJOR INDICES IN THE GREEN. SCOTT. >>HEY THERE. MAY NOT SEEM LIKE IT BUT THE S&P 500 HAS BEEN TRADING IN A NARROW RANGE THROUGHOUT THIS VOLATILE MONTH OF AUGUST. 2820 TO 2950. HERE TODAY WE’RE MOVING BACK NEAR THE HIGHER END OF THAT RANGE WITH THE S&P 500 NOW AT 2925 GIVE OR TAKE. ALL THIS COMES ON POSITIVE TRADE HEADLINES WE GOT THIS MORNING WITH CHINESE OFFICIALS SAYING THEY DON’T WANT AN ESCALATION OF THE TRADE WAR. SO THAT WAS ENOUGH TO SEND THE MARKET HIGHER. WE SAW A NICE RECOVERY IN TREASURY YIELDS ACROSS THE BOARD. YIELD CURVE IS INVERTED WITH THE TWO YEAR YIELD ABOVE THE 10 YEAR YIELD. THE 10 YEAR YIELD DID CROSS BACK. 30 YEAR BACK ABOVE 2%. THOSE ARE IMPORTANT LEVELS TO WATCH. WE HAVE STOCKS REACTING TO EARNINGS. DOLLAR GENERAL IS UP OVER 10%. IT’S THE BEST PERFORMING STOCK IN THE S&P 500. THE COMPANY REPORTED EARNINGS THIS MORNING. SAME STORE SALES ROSE 4% AND THE COMPANY RAISE THE ITS GUIDANCE EVEN WITH THE THREAT OF TARIFFS, WHICH WE KNOW CAN HIT THE RETAILERS HARD. THE SECOND BEST PERFORMING STOCK IN THE S&P 500 IS UNITED RENTALS. THAT’S THE BIGGEST GAIN IN ABOUT TWO MONTHS. NO REAL SPECIFIC HEADLINES SURROUNDING UNITED RENTALS. THERE IS A HURRICANE EXPECTED IN FLORIDA THIS WEEKEND AND IF THERE IS DAMAGE THERE COULD BE INCREASED DEMAND FOR RENTAL EQUIPMENT, PERHAPS FROM UNITED RENTALS AS WELL. AND THEN ONE OTHER STOCK WE’RE WATCHING TODAY, BED, BATH AND BEYOND. THE STOCK IS UP OVER 10%. THERE WAS A REPORT IN THE DEAL SAYING THE COMPANY HAS HIRED GOLDMAN SACHS AND HAS RECEIVED CONDITIONAL OFFERS FOR VARIOUS BSINESS UNITS. THAT REPORT COMING FROM THE DEAL. >>SCOTT GAMM ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. WE’LL CHECK IN WITH YOU LATER IN THE SHOW. NEXT ON YFi PM, CHICAGO-BASED MARIJUANA COMPANY GREEN THUMB INDUSTRIES DELIVERING REVENUE GROUT OF MORE THAN 225% IN ITS LATEST QUARTER. ITS CEO JOINS US TO TELL US WHY THE COMPANY IS JUST GETTING STARTED. AS ILLINOIS PREPS FOR LEGALIZATION. HEIDI’S BELOVED RETAILER FOREVER 21 REPORTEDLY WEIGHING FILING FOR BANKRUPTCY. WHAT WENT WRONG, RIGHT AFTER THIS. >>>GOOD AFTERNOON AND WELCOME TO YFi PM. I’M ZACK GUZMAN. JOINING ME TODAY, MY GOOD FRIEND YAHOO FINANCE’S HEIDI CHUNG ALONG WITH RADIO SHOW HOST AND PODCASTER BEN KISSEL. WE’RE CHECKING THE MARKET ACTION. THE DOW UP MORE THAN 300 POINTS. S&P UP ABOUT 36. NASDAQ LEADING THE WAY HIGHER UP 1.5%. WE’RE WATCHING SHARES OF CANNABIS COMPANY GREEN THUMB INDUSTRIES AFTER REPORTING RESULTS FOR ITS SECOND QUARTER. YOU CAN SEE THERE SHARES IN THE GREEN UP BY ABOUT 1%. REVENUE TOPPED EXPECTATIONS. GROWING MORE THAN 225% FROM THE SAME QUARTER LAST YEAR TO HIT 44.7 MILLION. THE COMPANY REPORTED A WIDER PER SHARE LOSS THAN EXPECTED. FOR MORE ON THE QUARTER WE’RE JOINED BY FOUNDER AND CEO BEN KOVLER. THANKS FOR BEING WITH US. ASIDE FROM THE TOP LINE BEAT YOU GUYS HIT THE MILESTONE OF POSITIVE ADJUSTED MORE THAN $5 MILLION. WHEN INVESTORS LOOK AT THAT, SHOULD THEY BE LOOKING AT THAT AS A TURNING POINT FOR THE COMPANY? >>SURE. THANKS FOR HAVING ME. HAPPY TO BE HERE. I THINK YOU NAILED IT. IT IS A TURNING POINT OF THE BUSINESS. THERE’S A LOT OF COST INFRASTRUCTURE WE HAVE TO PUT IN THE BUSINESS IN ORDER TO GET TO THE SCALE AND NOW WE’RE SEEING THE REVENUE SPIGOTS TURN ON AS REVENUE TRIPLED YEAR OVER YEAR AND WE CONTINUE ON THAT PACE. >>IT’S NOT JUST YEAR OVER YEAR. THE MORE INTERESTING THING FOR ME TOO WAS THE REVENUE GROWTH JUST FROM THE LAST QUARTER UP MORE THAN 50% WHEN YOU LOOK AT IT. I MEAN WHAT’S REALLY DRIVING THE REVENUE GROWTH HERE AS YOU EXPAND TO MORE STATES. YOU JUST ADDED A NEW YORK LICENSE AS WELL. WHAT ARE GOING TO BE THE CATALYSTS MOVING FORWARD? >>AT THE CORE IS A TIDAL WAVE OF DEMAND FOR CANNABIS PRODUCTS ACROSS THE COUNTRY. WE’RE IN A FORTUNATE POSITION WITH LICENSES AND LIMITED LICENSE MARKETS. THERE’S LOW AMOUNT OF SUPPLY AND HUGE AMOUNTS OF DEMAND. THAT’S GOOD FOR THE BUSINESS OPERATOR. IN MEDICAL MARKETS OR ADULT USE MARKETS, STORES ARE OPENING, PATIENTS AND CONSUMERS ARE BECOMING AWARE OF THIS PRODUCT AND THEY’RE COMING INTO THE STORES, BUYING THE PRODUCT AND WE’RE JUST AT THE VERY EARLY INNINGS OF HOW BIG THIS INDUSTRY CAN BE. >>HEY, BEN. HOW ARE YOU? I HAVE A QUESTION REGARDING, YOU MENTIONED HOW YOU HAVE A LIMITED NUMBER OF LICENSES TO GIVE OUT. WHEN IT COMES TO MINORITY COMMUNITIES, WHEN IT COMES TO COMMUNITIES THAT HAVE BEEN MOST TORN APART BY THE WAR ON DRUGS, IS THERE ANY ATTEMPT TO SORT OF GIVE THOSE LICENSES OUT TO THOSE COMMUNITIES FIRST OR GIVE THEM FIRST DIBS AT ALL? >>FOR SURE. AT GTI WE’RE BIG ADVOCATES OF OPENING UP OPPORTUNITY FOR THOSE THAT HAVE BEEN IMPACTED BY THE WAR ON DRUGS. EARLIER THIS WEEK WE LAUNCHED OUR LEAP PROGRAM WHICH IS A LICENSE EDUCATION APPLICATION PROGRAM. HERE IN ILLINOIS THOSE WHO HAVE BEEN AFFECTED BY THE WAR ON DRUGS ARE GOING TO HAVE THE ABILITY TO BE FIRST IN LINE OF THE NEW PEOPLE COMING INTO THE INDUSTRY. AND SO IT’S TRUE TO WHO WE ARE TO OFFER THE OPPORTUNITY OF HOW TO GET THROUGH THIS PROCESS. HOW TO FIND A LOCATION FOR A STORE. HOW TO WRITE AN APPLICATION. WHAT KINDS OF LLC OR C CORP. ONE NEEDS TO SET UP. WE’RE HAPPY TO LEND A HAND FOR OTHERS COMING INTO THE SPACE. >>WHEN WE LOOK AT IT, WE HAD CURALEAF CEO ON EARLIER THIS WEEK. HE WAS SAYING MASSACHUSETTS WAS GOING TO BE IMPORTANT TO THEIR COMPANY’S GROWTH. PERHAPS NOT SURPRISING HE’S BASED IN MASSACHUSETTS. WHEN WE LOOK AT YOU BASED IN CHICAGO. ILLINOIS COMING ON WITH LEGALIZED MARIJUANA STARTING IN JANUARY. HOW BIG IS THAT GOING TO BE AS PART OF YOUR FOCUS? I KNOW YOU’RE IN 12 STATES, BUT ILLINOIS, IS THAT GOING TO BE THE HEART OF WHAT YOU DO MOVING FORWARD? >>YEAH. ILLINOIS IS MAJOR. IT’S OUR BACKYARD. WE’RE ONE OF THE ONLY COMPANIES THAT HAVE ALREADY CONVERTED FROM MEDICAL TO ADULT USE IN SEVERAL MARKETS. ONE IS NEVADA AND THE OTHER IS MASSACHUSETTS. WE’RE OPEN IN AMHERST, MASSACHUSETTS AND OUR BRANDED PRODUCTS ARE AROUND MASSACHUSETTS AS WELL. BUT FOR OUR BUSINESS, ILLINOIS WITH 13 MILLION PEOPLE, A STATE IN THE MIDWEST, THE FIRST ONE IN THE MIDWEST TO GO TO ADULT USE, THERE’S GOING TO BE A MONSTROUS NEW INDUSTRY TO THE SIZE OF 2 TO $3 BILLION ACCORDING TO SOME ANALYSTS AND WE’RE IN POLE POSITION TO TAKE ADVANTAGE OF THAT. >>BEN KOVLER, THANK YOU SO MUCH FOR BREAKING THAT DOWN FOR US. >>>MOVING ON, THE GLOBAL FOOD AND BEVERAGE MARKET IS ALSO EXPECTED TO BE HOT. NOT JUST LIKE CANNABIS BUT ALSO BEVERAGES BEING A VERY BIG THING. IT’S EXPECTED TO REACH NEARLY $80 BILLION IN REVENUE THIS YEAR. THE CEO OF COCA-COLA-BACKED IRIS NOVA SPOKE ABOUT THE FUTURE OF THAT INDUSTRY. EMILY MCCORMICK JOINS US WITH THE LATEST. >>WHAT HE’S SAYING IS THE NEXT BIG BEVERAGE COMPANY IS NOT GOING TO LOOK LIKE COKE OR PEPSI. HE IS CEO OF IRIS NOVA, TRYING TO BE A PORTFOLIO COMPANY IN A SIMILAR WAY, BUT NOT TRYING TO CREATE BILLION DOLLAR BRANDS. HE’S TRYING TO CREATE THESE MILLION DOLLAR COMPANIES TO BUILD THESE OUT AND BE ABLE TO BE NIMBLE AND FLEXIBLE AND MEET CHANGING CONSUMER NEEDS. HERE’S WHAT HE HAD TO SAY ABOUT THAT. >>THE DIRTY LEMON LINE WE HAVE A BASE OF LEMON JUICE, OCEAN MINERALS AND SEA SALT THEN WE ADD FLAVOR AND FUNCTION ON TOP OF THAT. AND THAT’S BEEN A REALLY GREAT WAY FOR US TO SCALE, WE COULD LAUNCH HUNDREDS OF DIFFERENT BEVERAGES UNDER THE LINE AND NOT EVER REALLY BE TIED TO ONE SPECIFIC INGREDIENT AND I THINK THAT’S A CHALLENGE I’VE SEEN WITH A LOT OF OTHER BRANDS IS THEY FOCUS ON ONE INGREDIENT AND CONSUMERS ARE SO TRANSIENT IN THEIR PURCHASING DECISIONS NOW THAT IT BECOMES REALLY HARD TO KIND OF REST YOUR LAURELS ON ONE SPECIFIC INGREDIENT AND BUILD A BRAND THAT WAY. WE DON’T BELIEVE IN BILLION DOLLAR BRANDS. WE’RE TRYING TO BUILD MILLION DOLLAR CUSTOMERS. WE WANT TO HAVE A BILLION DOLLAR ORGANIZATION. BUT I DON’T THINK THAT BILLION DOLLAR BRANDS WILL EXIST IN THE FUTURE. I DON’T THINK THAT THERE IS THE NEXT COCA-COLA AS A BRAND. LIKE THE PRODUCT COCA-COLA BEING BUILT RIGHT NOW. BECAUSE THERE’S JUST TOO MANY OPTIONS. THERE’S A LOT OF START UPS OUT THERE CREATING A VARIETY OF DIFFERENT PRODUCTS FOR CONSUMERS AND THAT CREATES A LEVEL OF SELECTION THAT CONSUMERS ENJOY AND THEY WANT TO PARTAKE IN. >>AND OF COURSE IRIS NOVA IS BACKED BY COCA-COLA. THERE WAS AN INFUSION OF $15 MILLION IN SEED FUNDING IN DECEMBER THAT WAS RAISED AT A $60 MILLION VALUATION. WHAT ZAK WAS TELLING ME IS HE DOESN’T WANT TO BE ACQUIRED BY COCA-COLA. IF THE CEO CAME KNOCKING ON THE DOOR HE WOULD PROBABLY TURN IT DOWN. THEY’RE LOOKING AT AN EXIT OF AN IPO SORT OF LIKE WHAT WE’VE SEEN WITH SOME OF THESE OTHER CONSUMER FACING BRANDS. THEY WANT TO HIT $100 MILLION IN ANNUAL REVENUE AT A PROFITABLE PACE. THEY’RE THINKING THAT’S GOING TO BE HIT IN THE NEXT THREE YEARS. >>I’VE NEVER HAD ANY OF THEIR BEVERAGES. I HAVE TO KNOW. I’M SURE YOU TRIED A LOT OF THEM. ARE THEY GOOD? >>YEAH, SO. >>HIGH BAR. >>I’M SKEPTICAL. >>I THINK THEY’RE INTERESTING. THEY’RE DEFINITELY NOT SWEET. THAT’S THEIR BIG THING. IT’S A WELLNESS PRODUCT. IT’S LEMON-BASED. IT HAS A LITTLE BIT OF BITTERNESS TO IT. YOU DEFINITELY, YOU GET THAT FUNCTIONALITY. I DRANK IT AFTER A WORKOUT. IT’S ONLY 15-CALORIES. YOU’RE GETTING THOSE ELECTROLYTES. >>SUMMER BOD. >>EXACTLY. YEAH. SO IT’S GOOD FOR THAT. FOCUSED ON THE WELLNESS CONSUMER. IT’S A PREMIUM PRODUCT. IT’S $10 A BOTTLE. >>A BOTTLE? WHAT IS IN IT? ELIXIR OF THE GODS APPARENTLY. >>300 OUNCES? HOW BIG IS A BOTTLE? >>16-OUNCE. >>CAN I WASN’T THERE YET. I’M SURE YOU SAVED ME A BOTTLE. >>YOU’RE GOING TO HAVE TO PICK ONE UP YOURSELF. YOU CAN TEXT TO ORDER IT. >>AWKWARD. >>WE’RE ALL FRIENDS. >>$10. THIS IS GOING TO BE A BLOOD SPORT TO GET THAT BOTTLE. >>THANK YOU SO MUCH. APPRECIATE YOU BRINGING THAT TO US. SHIFTING FROM BEVERAGES OVER TO RETAILERS. FOREVER 21 IS CONSIDERING A POSSIBLE BANKRUPTCY FILING ACCORDING TO BLOOMBERG. THE FAST FASHION RETAILER HAS BEEN IN DISCUSSIONS FOR MORE FINANCING AS ITS TURN AROUND OPTIONS ARE NOW DWINDLING. THE CHAIN IS REPORTEDLY AIMING TO SECURE A POTENTIAL DEBTOR IN POSITION LOAN TO TAKE THE COMPANY INTO CHAPTER 11. FOREVER 21 HAS OVER 800 STORES GLOBALLY. NOT A SMALL RETAILER HERE. OBVIOUSLY THE TREND HAS BEEN SOME OF THESE SMALLER NICHE RETAILERS FILING FOR BANKRUPTCY. >>OF KOREAN IMMIGRANTS CAME TO LOS ANGELES AND THEY WERE SORT OF THE SUCCESS STORY. THERE ARE A LOT OF KOREAN IMMIGRANT FAMILIES THAT OWN AND OPERATE THESE GARMENT, CHEAPER FASHION LINES IN DOWNTOWN LOS ANGELES. FOREVER 21 WAS REALLY THE ONE THAT MADE IT. THEY BROKE OUT AND THEY REALLY CREATED A LIFE FOR THEMSELVES AND THEY WERE BILLIONAIRES AT ONE POINT IN 2015. BUT IT’S HARD. I HAVEN’T SHOPPED OR GONE INTO A FOREVER 21 IN YEARS. I REMEMBER GOING THERE A LOT WHEN I WAS YOUNGER AND POORER BECAUSE THEIR CLOTHES WERE MORE AFFORDABLE WITH THE LIKES OF DIFFERENT COMPANIES LIKE RENT THE RUNWAY YOU CAN GET DESIGNER CLOTHES AND RENT THEM FOR CHEAPER. A LOT OF THESE COMPANIES ARE STRUGGLING AND RETAILERS HAVE BEEN SHUTTING THEIR DOORS. WE’VE SEEN COMPANIES LIKE THAT IN RECENT YEARS. SPECIFICALLY THIS YEAR I WAS LOOKING AT THE LIST OF RETAILERS THAT HAVE CLOSED THEIR DOORS. CHARLOTTE RUSSE, ANOTHER COMPANY JUST LIKE FOREVER 21. CHEAPER WOMEN’S APPAREL. PAYLESS. THE LIST GOES ON AND ON. >>OF COURSE THE THEME IS BRICK AND MORTAR IS DYING. THAT’S JUST THE WAY IT’S GOING. IF IT THESE COMPANIES WERE NOT AWARE OF IT, IT REMINDS ME OF BLOCKBUSTER THINKING NETFLIX WAS A FAD. OF COURSE WHERE IS BLOCKBUSTER IF THESE COMPANIES DIDN’T HAVE AN AGGRESSIVE ONLINE PERSONALITY, PERSONA BEFORE, IF THEY DIDN’T HAVE THAT BUILT IN TO WHAT WAS CURRENT, WHAT IS HAPPENING CURRENTLY, THEY’RE FINDING THEMSELVES BEHIND THE EIGHT BALL AND BRICK AND MORTAR I OFFER SUFFERING. >>YOU HAVE TO BE SHIFTING YOUR PERSONA AS WELL AS YOUR CONSUMERS CONSUMERS AGE. FOREVER 21 NOT THE ONLY BRAND THAT STRUGGLED WITH THAT. WE SPOKE WITH NINA AGDAL YESTERDAY ABOUT VICTORIA’S ECRET AND WHAT THAT COMPANY FACING. >>THEY WERE GOING DOWN HILL REALLY FAST. I’M HAPPY THEY’RE STARTING TO INCLUDE DIFFERENT BODY TYPES AND DIFFERENT TYPE OF PEOPLE AND WOMEN. THAT’S SO NEEDED. DO I THINK IT’S IRONIC THAT THEY HAD TO HIT THE ROCK BOTTOM BEFORE THEY WENT THERE? MAYBE A LITTLE BIT. I’M REALLY HAPPY THEY’RE TAKING THE STEPS TOWARDS IT, BUT THERE’S A LONG WAY TO GO. >>VICTORIA’S SECRET ONE OF THOSE BRANDS THAT HAD COME UNDER PRESSURE FOR STICKING TO THEIR OWN MODEL TYPE; RIGHT? >>I THINK WE ALWAYS TALK ABOUT THIS ON THE TICKER, THE OTHER SHOWS. WHY VICTORIA’S SECRET IS FAILING AND THAT’S BECAUSE EVEN ON THEIR INVESTORS PAGE HERE. EVERYONE LOOKS THE SAME. PEOPLE DON’T LOOK LIKE THIS IN REAL LIFE. COMPANIES LIKE AERIE. >>WELL THEY’RE REAL PEOPLE. >>I MEAN. >>I DON’T KNOW. THEY DON’T LOOK LIKE ME. >>THEY ALL HAVE THE SAME HAIR. THEY HAVE THE SAME BODY TYPE. THERE’S REALLY NO DIVERSITY WHEN IT COMES TO RACE. THAT’S THE PROBLEM. THEY’RE NOT ADAPTING TO CHANGING TIMES. >>NOT THE SAME PROBLEM THAT FOREVER 21 HAD. >>NO. NO. TOTALLY DIFFERENT. >>IT’S BRICK AND MORTAR AND IT’S YOUR SHIFT TO E-COMMERCE. IN THE CASE OF VICTORIA’S SECRET, IT’S DIFFERENT. >>WE LIVE IN A DIFFERENT SOCIETY NOW THAN WE DID PREVIOUSLY. THE GUY BEHIND, THE MAIN DUDE BEHIND VICTORIA’S SECRET SAID SOME BAD THINGS IN THE PAST. I ALSO THINK IT’S MEN CREATED FOR WOMEN AND WOMEN ARE LIKE NO ONE FITS INTO THAT, AS YOU MENTIONED. THEY PROBABLY COULD BENEFIT FROM DOING MORE PLUS SIZE OR REALLY JUST REGULAR SIZE LINGERIE AND THINGS LIKE THAT. I’M SURPRISED THEY HAVEN’T GONE THERE OUT OF INTELLIGENCE WHEN IT COMES TO THEIR BUSINESS. >>AS WE JUST HEARD FROM NINA. IT SHOULDN’T TAKE GETTING TO ROCK BOTTOM OR SEEING SALES CONTINUE TO DECLINE BEFORE YOU START TO SAY MAYBE WE SHOULD HAVE DONE SOMETHING. AS WE’RE LEARNING YOUR TIMELINE IS LIMITED IF YOU ARE A BRICK AND MORTAR RETAILER TO GET THINGS TURNED AROUND. BEFORE WE GO TO BREAK WE WANT TO TAKE A LOOK AT THE DOW LEADERS SO FAR TODAY. WE’RE SEEING INTEL, JP MORGAN, NIKE, CATERPILLAR. PERHAPS NOT SURPRISING TO SEE TRADE LEVER NAMES. THE DOW LAGGARDS. VERIZON MAKING THAT LIST, AS WELL AS JNJ. ALIBABA FOUNDER WHO ONCE PUSHED FOR 12 HOUR WORKDAYS SAYING HUMANS WILL ONLY HAVE TO WORK 12 HOURS A WEEK IN THE FUTURE. WHY HE SEES THAT COMING TO FRUITION. >>>TESLA LAUNCHING ITS OWN INSURANCE PROGRAM TODAY. WHY CEO ELON MUSK SAYS IT’LL BE 30% CHEAPER THAN THE COMPETITION WHEN YFi PM RETURNS. >>>WELCOME BACK TO YFi PM. ALL THREE MAJOR INDICES ARE STILL IN THE GREEN RIGHT NOW. THE DOW UP 355 POINTS. SM.P UP 40. NASDAQ UP MORE THAN 1.5%. WE’LL SEE WHERE THINGS GO AS WE APPROACH 2:00 P.M. EASTERN TIME. >>>JACK MA IS CHANGING HIS TUNE. THE FOUNDER OF ALIBABA SAT DOWN WITH TESLA CEO ELON MUSK AT THE WORLD ARTIFICIAL INTELLIGENCE CONFERENCE AND SAID QUOTE, I THINK PEOPLE SHOULD WORK THREE DAY AS WEEK, FOUR HOURS A DAY. I THINK BECAUSE OF ARTIFICIAL INTELLIGENCE PEOPLE WILL HAVE MORE TIME. AND IT’S A FAR CRY FROM THE 12 HOURS A DAY SIX DAYS A WEEK WORK CULTURE HE PREVIOUSLY ENDORSED. OF COURSE THIS IS LOOKING AT THE FUTURE AND THE WAY THAT AI MIGHT IMPACT THE WORK SCHEDULE. STILL, OPTIMISTIC JACK MA WHEN HE LOOKS AT HOW OUR LIVES WILL BE. >>I THINK HE’S POINTING TO THE FACT WE’RE GOING TO BE MORE EFFICIENT GOING FORWARD BECAUSE WITH THE HELP OF AI; RIGHT? HE’S NOT SAYING WE SHOULD WORK LESS. HE’S SAYING IT’S GOING TO MAKE US MORE EFFICIENT AND THUS PEOPLE WON’T HAVE TO WORK AS MANY HOURS PHYSICALLY. BUT HE AND ELON MUSK ACTUALLY DIDN’T QUITE AGREE ON JUST HOW SMART COMPUTERS ARE THOUGH; RIGHT? ELON MUSK WAS SAYING COMPUTERS ARE SO SMART AND JACK MA WAS LIKE WELL WE CREATED COMPUTERS, COMPUTERS DIDN’T NECESSARILY CREATE US. THEY’RE COOL BUT NOT ALL THAT SMART. >>ELON MUSK HAS WARNED ABOUT AI KIND OF BEING A THREAT TO HUMANITY OVERALL. >>THE FUTURE IS NOW AND HOPEFULLY WE MAKE THE RIGHT DECISIONS SO WE DON’T HAVE A TERMINATOR 2 FUTURE. WHEN IT COMES TO AI IN TECH, THERE ARE POSITIVE THINGS. SELF-DRIVING CARS, FOR EXAMPLE. I UNDERSTAND AUTOMATION IS GOING TO KICK TRUCK DRIVERS OUT OF THEIR JOBS AND THAT’S DEVASTATING. BUT WHEN IT COMES TO EVERY DAY SAFETY BEHIND THE WHEEL, IT HAS SHOWN THAT AI CARS LEARN WHEN ONE MAKE AS MISTAKE, THEY ALL LEARN FROM IT. I THINK THAT CAN BE A BENEFIT. WHAT WE HAVE HERE THEN IS PEOPLE WHO WILL BE WORKING LESS. DO WE HAVE TO PUT IN WHAT ANDREW YANG IS CALLING FOR, UNIVERSAL BASIC INCOME? AND IF THAT IS THE CASE, AND THAT HAS BEEN THE CASE IN SOME OTHER WESTERN COUNTRIES. IF THAT IS THE CASE, WHAT DO WE TAX AI AS? WHAT DO WE TAX MACHINES AS? GERMANY GAVE COMPANIES THAT AUTOMATED ALMOST, THEY GAVE THEIR AUTOMATION ALMOST HUMAN STATUS. THEY TAXED THEM THE SAME AS IF THEY WERE REAL EMPLOYEES TO OFFSET THE FACT THAT MANY OF THOSE PEOPLE HAVE LOST THEIR JOBS. SO THESE ARE CONVERSATIONS THAT ARE GOING TO BECOME MORE MAINSTREAM. YOU GO BACK TO A UNIVERSAL BASIC INCOME. JUST EVEN IN 2012 THAT WOULD HAVE BEEN CONSIDERED COMPLETELY INSANE. NOW. >>NOW IT’S COMING UP ON 2020. >>IT’S A BIG PART OF A PLATFORM OF A CANDIDATE WHO IS GOING TO BE IN THE TOP TEN WHEN IT COMES TO THE DEBATE. >>CAN’T BE IGNORED. IT’S SOMETHING A LOT OF PEOPLE IGNORED. >>THIS IS A LITTLE MORE ABSTRACT, BUT AS WE’RE SEEING WITH THE IMMENSE AMOUNT OF VIOLENCE COMING OUT, SO MANY OF THESE CHILDREN, KIDS, WHATEVER, COMMITTING MASSIVE ACTS OF VIOLENCE. I AM CONCERNED WITH WHERE A PEOPLE FIND SELF-WORTH, WHERE PEOPLE FIND HUMAN DIGNITY. OFTEN TIMES THE FORMER WAS YOU TIED IT TO YOUR JOB. MY FATHER WAS A TRUCK DRIVER. HE WAS PROUD OF BEING A TRUCK DRIVER. A LOT OF PEOPLE FOUND WHO THEY WERE WITH THEIR POSITION, SO WHAT’S GOING TO HAPPEN WHEN THEY DON’T HAVE A JOB? >>THAT WAS THE HEART OF THE 996 PROGRAM. JACK MA’S BELIEF WAS GOING TO WORK WAS AN HONOR. WORKING WAS AN HONOR. BUT YOU’RE RIGHT, AS YOU SHIFT AWAY FROM THAT, IF YOU’RE JUST GETTING PAID TO SIT THERE, THERE’S MENTAL HEALTH ASPECTS ATTACHED TO THAT. ME SITTING IN THIS CHAIR, I GET A LOT OUT OF IT. >>I’M A SMALL BUSINESS OWNER. I PODCAST EVERY DAY. I MEAN THAT’S HOW I IDENTIFY MYSELF. >>YOU WOULDN’T BE A VERY HAPPY GUY. >>ROBOT CAN’T DO WHAT I DO. CERTAINLY NOT. >>NOT GOING TO SAY THAT. >>HAVE YOU SEEN THE AI NEWS REPORTERS AND ANCHORS? THEY’RE COMING FOR US. >>VERY DARK PROSPECTS THERE. WHILE WE’RE TALKING ABOUT ELON MUSK, TESLA IS REVVING UP ITS CAR INSURANCE. THE AUTO MAKER IS OFFERING INSURANCE FOR TESLA OWNERS STARTING IN CALIFORNIA. DESCRIBING THE OFFERING AS QUOTE, COMPETITIVELY PRICED WITH UP TO 30% LOWER RATES. THE INSURANCE WILL ONLY BE AVAILABLE IN CALIFORNIA FOR NOW BUT TESLA SAYS IT PLANS TO EXPAND TO ADDITIONAL STATES IN THE FUTURE. MUSK HAS BEEN TEASING THIS SINCE APRIL. THE PUSH BEING THAT A LOT OF TESLA DRIVERS AREN’T GETTING THE RATES THEY DESERVE AND NOW ELON MUSK DOING SOMETHING ABOUT IT. A POTENTIAL REVENUE DRIVER WHEN WE TALK ABOUT TESLA. >>YES. I THINK ONE THING WE NEED TO NOTE HERE IS THAT WHEN IT COMES TO AUTO INSURANCE A LOT OF THE COST IN HOW A LOT OF THESE COMPANIES THINK ABOUT COST IS BASED ON SPECIFIC VEHICLES; RIGHT? SO LOOKING AT THE AUTO ACCIDENT HISTORY WITHIN TESLA VEHICLES AND ALL OF THAT STUFF HELPS AAA OR WHATEVER COMPANY COME UP WITH THEIR RATES. SO IF TESLA IS DOING THIS FOR JUST TESLA, I COULD SEE HOW THE RATES WOULD BE COMPETITIVE FOR TESLA OWNERS. IT SEEMS LIKE ELON MUSK WANTS TO BE A ONE STOP SHOP. SEEMS LIKE THAT’S BEEN HIS PLAN ALL ALONG. >>MY BUDDY GOT A TESLA AND IT’S BEEN DIFFICULT FOR HIM. YOU CAN ONLY GO TO SO MANY PLACES FOR MAINTENANCE AND I DON’T KNOW. HE DOESN’T REALLY, HE’S NOT REALLY SOLD ON THE PRODUCT. I THINK TESLA MIGHT JUST BECOME ONE OF THE LARGEST PAPERWEIGHTS IN HUMAN HISTORY AS SOON AS THEY CLOSE DOWN AND THEN NO YOU CAN’T GET IT FIXED ANYWHERE. >>THAT HAS BEEN ONE OF THE BIG ISSUES. >>IT IS A HUGE ISSUE IS SERVICE. >>YOU HAVE TO LEAVE IT THERE FOR REALLY LONG TIME. >>YOU HAVE TO BE LIKE AN ENGINEER TO FIX THE THING. IT’S NOT LIKE IT USED TO BE. >>SO I TAKE IT YOU’RE NOT A BIG TESLA GUY. >>NO. I MEAN, YOU KNOW. I’M A BIG, I LOVE SUBWAY. I LOVE THE L TRAIN. >>I THOUGHT YOU WERE TALKING ABOUT THE SANDWICH. >>I ALSO LOVE SUBWAY SANDWICHES. >>FAIR ENOUGH. I GUESS YOU CAN. I DON’T KNOW. >>WHAT ARE YOUR THOUGHTS ON THIS? >>I WOULD GET IT. IF YOU’RE NOT GETTING A GOOD RATE. IT WAS HARD TO GET A GOOD RATE. EVERYBODY WOULD LOOK AT THE CAR AND BE LIKE I DON’T WANT TO INSURE THIS. >>TOKYO DRIFT. >>IT WAS A GOOD CAR. I THINK IT’S PROBABLY THE TENTH TIME I’VE MENTION. CLEARLY I HAD A CONNECTION. >>I THINK CAR OWNERS WANT TO HAVE GREAT RATES. >>ABSOLUTELY. >>MORE POWER TO THEM. WE’LL SEE WHERE THIS GOES. IT’S JUST LAUNCHING IN CALIFORNIA. BEN, THANK YOU FOR BEING HERE FOR THE FULL HOUR. APPRECIATE IT. GOOD TO SEE YOU. HEIDI, WELCOME BACK. LET’S CHECK IN WITH SCOTT GAMM ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. >>I AM JOINED BY JOHN EID, CEO OF ARGUS RESEARCH. YOU’VE BEEN ENCOURAGED BY SOME OF THE CONSUMER DATA WE SAW THIS MORNING. >>CONSUMER DATA AND ALSO THE NEWS OUT OF CHINA THAT THEY’RE GOING TO BACK OFF THE TRADE WAR. WE SAW IN THE SECOND QUARTER GDP REPORT THAT THE SECTORS THAT COUNT ON TRADE CAP X AND EXPORTS REALLY WERE WEAK WHILE THE CONSUMER WAS VERY STRONG. AS WAS GOVERNMENT SPENDING. SO THOSE TWO SECTORS THAT WERE WEAK COULD USE A BOOST. >>I GUESS THE QUESTION BECOMES IF THE TRADE WAR CONTINUES CAN THE CONSUMER ALONE KEEP US OUTS OF A RECESSION? >>WELL CONSUMER IS ABOUT TWO- THIRDS OF THE ECONOMY SO THERE’S A GOOD CHANCE THAT IT COULD, UNLESS LET’S SAY THE MANUFACTURING SECTOR CONTINUES TO WEAKEN AND WE START TO SEE LAYOFFS. THE HOUSING SECTOR ISN’T ROBUST RIGHT NOW. YOU MIGHT SEE A DIP IN CONSUMER CONFIDENCE THAT COULD CURTAIL CONSUMER SPENDING AND PUSH US CLOSER TO THAT RECESSION. >>TO ME THAT SOUNDS LIKE NOT NECESSARILY A GREAT BACKDROP FOR THE STOCK MARKET. WHAT’S YOUR TAKE ON THE LINK BETWEEN SOME OF THOSE ECONOMIC HEADWINDS AND WHAT THEY MIGHT MEAN FOR STOCKS? >>INTEREST RATES HAVE FALLEN IN ANTICIPATION OF WEAK ECONOMIC GROWTH. SO THAT HELPS STOCK VALUATIONS. NOW THERE’S SOME THEMES WE THINK WORK IN THE STOCK MARKET HERE. LIKE COMPANIES THAT ARE GROWING THEIR DIVIDENDS AGGRESSIVELY. THAT’S A GOOD SIGN OF FINANCIAL STRENGTH AND MANAGEMENT CONFIDENCE. A COMPANY LIKE LOCKHEED MARTIN. MAYBE LIKE A GOOGLE OR A COSTCO. SO THERE’S IMPORTANT THEMES FOR EQUITIES RIGHT NOW. >>WE HAVEN’T TOUCHED ON THE INVERTED YIELD CURVE WHICH STILL IS PLAY. HOW WORRISOME IS THAT? WE KNOW THAT HAS HISTORICALLY PROCEEDED RECESSIONS. >>GOOD NEWS ABOUT THE LOW INTEREST RATES IS IT HELPS STOCK VALUATIONS AND IT’S GOING TO HELP CAPITAL INVESTMENT. IF THE TRADE WARS AREN’T SO BAD. IT SIGNALS MONEY MANAGERS DON’T HAVE MUCH CONFIDENCE AT ALL IN LONG TERM ECONOMIC GROWTH IN THE U.S. SO >>THEY’RE KIND OF SO WILLING TO LOCK UP MONEY FOR A LOWER TURN FOR A LONG TIME. >>RIGHT. THEY DON’T THINK THERE’S GOING TO BE ANY INFLATION. THEY DON’T THINK THERE’S GOING TO BE GROWTH. I THINK YIELD CURVE INVERTS AGAIN ONCE GLOBAL GROWTH STARTS TO PICK UP. THAT COULD OCCUR AS THE TRADE WARS START TO FADE AND AS BREXIT IS RESOLVED THOSE ARE A COUPLE OF ISSUES RIGHT NOW. >>THANK YOU FOR JOINING US. BACK TO YOU. >>COMING UP, THE OUTLOOK ON RETAIL AMID LOOMING TARIFFS. THE DETAILS AS BEST BUY SLASHES ITS SALES FORECAST. NEXT. THE TICKER ALL OVER IT, STARTS IN TWO. >>> GOOD AFTERNOON. WELCOME TO THE TICKER. YAHOO FINANCE. I AM AKIKO FUJITA. STOCKS ARE SURGING IN THE OPTIMISM OF THE U.S. CHINA TRADE DEAL. THE COMMERCE MINISTRY SAYING THAT OFFICIALS ARE WILLING TO RESOLVE THE ISSUE IN A CALM MANNER. WE DID HEAR PRESIDENT TRUMP WEIGHING IN ON THE STATE OF THE NEGOTIATIONS WITH BEIJING EARLIER TODAY IN AN IN HER VIEW WITH FOX NEWS RADIO. >> I HAVE A TALK SCHEDULED FOR TODAY AT A DIFFERENT LEVEL. AND THEY HAVE BEEN TALKING. AND THE FAKE NEWS TRIED TO SAY WE WEREN’T TALKING LAST WEEK AND THEN THE VICE PREMIER OF CHINA SAID, WE HAVE BEEN TALKING. >> SOME OF THE NICER WORDS BETWEEN THE U.S. AND CHINA PUSHING THE MARKET HIGHER. SEEING THE S&P 500 AT 420930. THE NASDAQ UP 132. WE SHOULD POINT OUT THAT THIS COMES AS WE TRANSLATED THE MINISTRY. THEY DID NOT EXPLICITLY SAY THEY WOULD NOT RETALIATE BUT HAD SUFFICIENT MEANS TO RETALIATE. LET’S BRING IN TED OAKLEY FROM EXPO ADVISORS. HE IS WITH ME AT THE DESK. IT IS INTERESTING TO SEE HOW THE MARKET MOVED TODAY. INITIALLY ON THE COMMENTS THAT WERE INTERPRETED AS A SOFTENING ON THE CHINESE SIDE. IF YOU LOOK AT THE COMMENTS FROM THE COMMERCE MINISTRY, IT DOES NOT LOOK LIKE MUCH HAS CHANGED. >> NOT MUCH, AKIKO. WHAT HAPPENS IS PEOPLE TEND TO CHASE THE NEWS BOTH WAYS. THE NEGATIVE IS THE SAME THING. IT DEPENDS ON WHAT HAPPENS. A TWEET OR A PIECE OF NEWS COMES OUT AND THEY THINK SOMETHING IS GOING TO HAPPEN. WE SET A LONG TIME AGO THAT CHINA WOULD BE A LONG AND DRAWN OUT SITUATION. NOT LIKE MEXICO WHICH WAS EASY. THEY CLOSED IT QUICKLY. CHINA IS A DIFFERENT GAME. >> AS YOU POINTED OUT, IF YOU LOOK AT THE S&P 500, A YEAR AGO, WE ARE EXACTLY WHERE WE WERE. ALMOST A STRAIGHT LINE. >> WE WERE. JANUARY 2018, SEPTEMBER OF 19 AND NOW EVEN MONEY. >> HOW MUCH OF WHAT WE ARE SEEING TODAY HAS TO DO WITH THE AUGUST TRADE. WE TALK ABOUT THIS BEING A BIT OF A VOLATILE MONTH. NOT HEAVY VOLUME PER SE. A FEW DAYS AWAY FROM A LONG HOLIDAY WEEKEND. 300 POINTS BASED ON COMMENTS COMING OUT OF CHINA THAT ARE PRETTY CONSISTENT WITH WHAT THEY SAID. IS IT REALLY ABOUT THE TRADE WAR TODAY? >> PROBABLY NOT. I HAVE PROBABLY BEEN AROUND LONGER THAN MOST PEOPLE. WHAT HAPPENS IS, YOU GET DOWN TO TWO DAYS BEFORE LABOR DAY AND A LOT OF THE PEOPLE ARE GONE. YOU FIND A LOT MORE SELLING COMES IN. IN SEPTEMBER AND OCTOBER THAN AUGUST AND JULY A LOT OF TIMES. I THINK IT IS BECAUSE THEY GET BACK AND THEY LOOK AT THINGS AND THEY SAY, I THINK WE WANT TO DO SOMETHING. BY NOW THEY ARE PROBABLY LAYING BACK ON THE BEACH SOMEWHERE. >> YOU POINTED TO THIS MENTALITY WE ARE SEEING IN THE MARKET RIGHT NOW. EVERYBODY CHASING A TRADE. WHAT DOES THAT SAY AS FAR AS THE MINDSET FOR INVESTORS? WE TALKED ABOUT THE UNCERTAINTY. ARE INVESTORS LOOKING FOR YIELD SOMEWHERE? IS THAT WHY ARE WE SEEING THE MOVES IN THAT DIRECTION? >> I THINK THEY ARE CONFUSED REALLY. THEY SEE THE INTEREST RATES GO A LOT LOWER THEN THEY EVER THOUGHT. EVERYBODY TOLD THEM THEY WOULDN’T DO IT. THEN THEY HAVE GONE A LOT LOWER. I KNOW FOR US, THE BIGGEST POSITION IN THE LAST YEAR HAS BEEN THE 20 YEAR TREASURY. WE GOT A LOT OF HEAT FOR IT IN THE BEGINNING. NOW THEY ARE SEEING IT. THEY DON’T KNOW EXACTLY WHAT TO DO. IF YOU LOOK ON THE STOCK SIDE, THEY ARE NOT GOING ANYWHERE. THEY LOOK AT THE TURMOIL IN THE WORLD AND I THINK THEY ARE CONFUSED. THEY ARE WATCHING IT. BUT THEY ARE NOT DOING ANYTHING. >> THEY ARE CONFUSED IN TERMS OF THE DIRECTION AND WHAT TO DO. >> ON THE ECONOMIC FRONT, WE DID REVISE IT GDP FOR THE 2nd QUARTER. REVISED DOWN TO 2%. WHAT IS YOUR READ ON THAT NUMBER IN TERMS OF WHAT IT MEANS. >> I THINK THE 2nd QUARTER WAS A BIT OF AN ANOMALY. WHAT HAPPENED IS, WHAT PRESSED IT WAS CONSUMER SPENDING. BUT WAGES DID NOT GO UP. THEY BORROWED MONEY TO DO THE SPENDING. THAT IS NOT GREAT ON THAT END. WE THINK EVERYBODY PROBABLY HAS A HIGHER NUMBER THAN WHAT WOULD COME IN ON THE THIRD AND 4th QUARTER. IF YOU LOOK AT THE CENSUS AROUND 2% FOR THE THIRD OR 4th QUARTER, I DON’T THINK WE GET THERE. >> GIVEN THE BACK AND FORTH WE HAVE SEEN OVER THE TRADE ISSUES, THAT HAS OVERSHADOWED WHAT HAPPENED LAST WEEK WITH THE COMMENTARY COMING OUT OF JACKSON HOLE. JAY POWELL GETTING HIT BY THE PRESIDENT. HE DID SORT OF SUGGEST, THERE IS ONLY SO MUCH THE CENTRAL BANK CAN DO. ESPECIALLY IN THE FACE OF WHAT IS HAPPENING IN THE TRADE WAR. BASED ON WHAT YOU HAVE HEARD, DO YOU THINK THE FED’S’ TRAJECTORY HAS CHANGED IN ANYWAY? >> I THINK THEY ARE A BIT CONFUSED. >> THERE IS A LOT OF CONFUSION. >> THERE ARE A SET OF PEOPLE, AND I HAVE THE NUMBERS IN THE OFFICE, THAT ARE AGAINST REDUCING RATES HERE. I THINK THE PROBLEM WITH THAT IS THAT THEY REALLY NEED TO. AND IF WE THINK ABOUT IT, IF THE OVERNIGHT RATE THAT YOU GET IS HIGHER THAN THE 30 YEAR BOND, THEN YOU ARE GOING TO HAVE SO MANY PEOPLE FROM OVERSEAS PUTTING MONEY INTO OUR OVERNIGHT PAPER. RIGHT NOW IT IS 3 BILLION. SOMETHING HAS TO CHANGE ON THAT. MY GUESS IS THAT THERE ARE PROBABLY 75-100 BASIS POINTS. AT LEAST MINIMAL ABOVE WHERE THEY SHOULD BE. I DOUBT IF THEY DO THAT AT THE MEETING. >> WE ARE A FEW DAYS AWAY FROM THE END OF AUGUST. LOOKING AHEAD TO SEPTEMBER, WE HAVE SEPTEMBER 1st TARIFFS SET TO TAKE EFFECT. THERE ARE QUESTIONS ABOUT WHETHER THE CHINESE WILL COME TO WASHINGTON ON THE TRADE NEGOTIATIONS AS WELL. WHAT ARE YOU LOOKING AT RIGHT NOW IN TERMS OF THE OUTLOOK FOR THE UNCERTAINTY? YOU POINTED TO OCTOBER 1st OF THE BIG MILITARY PARADE THAT WILL BE HELD IN CHINA TO MARK THE ANNIVERSARY OF THE PRC. IS THAT ESSENTIALLY A WINDOW THAT IS CLOSED RIGHT NOW? IN OTHER WORDS, SHOULD WE NOT BE LOOKING FOR ANY OTHER DEVELOPMENT UNTIL AFTER THAT, GIVEN THAT CHINA WANTS TO SHOW ITS MUSCLE? >> I WOULD GUESS THAT. ONE OF THE THINGS ABOUT CHINA IS YOU DON’T WANT THEM TO BE EMBARRASSED. IF THEY GET INTO A LOT OF THINGS BETWEEN NOW AND OCTOBER, YOU GET EMBARRASSED. AND THEY WILL BE SAYING, LOOK AT THE 70 YEAR REGIME AND HOW FANTASTIC IT IS. AND IT BLOWS THAT UP. YOU HAVE TO REMEMBER THAT HONG KONG IS ANOTHER THING ON THEIR PLATE. AND THERE ARE A LOT OF THINGS GOING AT ONE TIME. >> IN OTHER WORDS, DON’T EXPECT TO SEE ANY CONCESSIONS ON THE CHINESE SIDE. >> I WOULD NOT EXPECT THAT. >> GOOD TO HAVE YOU ON. >> THE TRADE WAR IS AFFECTING RETAILERS. WE SAW THE NUMBERS COMING FROM BEST BUY TODAY. STOCK IS TUMBLING AFTER MISSING REVENUE EXPECTATIONS. POSTING ADJUSTED EARNINGS OF $1.03 ON REVENUE UP $9.54 BILLION. THE ELECTRONICS RETAILER ALSO BLAMING THE PLANNED U.S. TARIFFS ON CHINESE IMPORTS FOR LOWERING ITS SALES FORECAST FOR CHARLIE O’SHEA IS A RETAIL ANALYST AND IS WITH ME HERE AT THE DESK. WELCOME LET’S START WITH THE NUMBERS FROM BEST BUY. THE CONCERN WAS NOT SO MUCH, WHAT IS TAKING EFFECT RIGHT NOW AS IT IS THE SEPTEMBER 1st TARIFFS AND POTENTIALLY DECEMBER 15th. HOW DAMAGING DO YOU THINK THIS IS GOING TO BE FOR THE COMPANY? >> I DON’T THINK THERE IS DAMAGE HERE. I LOOK AT THE REVENUE NUMBER. THEY HAVE TIGHTENED IT A LITTLE BIT. THE REVENUE GROWTH WILL STILL BE THERE. WE FOCUS ON OPERATING INCOME. BEST BUY TOOK ITS EARNINGS GUIDANCE UP WHICH TELLS ME, WHEN YOU LOOK AT WHAT HAPPENED WITH GROSS MARGINS IN THE 2nd QUARTER, THEY ARE HOLDING THE LINE. THEY ARE NOT GOING TO PROMOTE LIKE CRAZY. THEY ARE NOT GOING TO SELL A DOLLAR, FOR 99 CENTS JUST TO GROW THE TOP LINE. THEY WILL KEEP DOING WHAT THEY HAVE BEEN DOING THE LAST SEVERAL YEARS WHICH IS TO PROTECT MARKET SHARE BUT NOT BE SILLY ABOUT IT AND NOT GET TOO INTO CHASING PRICE. >> ADDING TO THAT, WE DID HEAR THAT NEW TARIFFS WOULD AFFECT 60% OF THE COST OF GOODS SOLD AT BEST BUY. THEY WANT TO REDUCE THAT TO 40%. WHAT KIND OF SOURCING OPTIONS DOES BEST BUY HAVE AS THEY PREPARE FOR THESE TARIFFS TO TAKE EFFECT? >> LIKE MOST OF THE LARGE RETAILERS AND I WILL THROW WALMART, TARGET AND COSTCO INTO THE MIX ALONG WITH BEST BUY, THE SUPPLY CHANGE IS REALLY DIVERSE. THERE HAS BEEN A LOT OF PRE- BUYING GOING ON WITH THE BIG GUYS OVER THE LAST SEVERAL QUARTERS SINCE THE TARIFFS STARTED TO GERMINATE. MY GUESS IS THAT THERE IS A LOT SQUIRRELED AWAY IN THE DISTRIBUTION NETWORK THAT WON’T BE TARIFF. AND THEN YOU HAVE OTHER COUNTRIES THAT BEST BUY CAN SOURCE PRODUCTS FROM, KOREA, FOR ONE. IF YOU WANT A TELEVISION SET AND YOU ARE GOING TO GO TO BEST BUY, YOU CAN GET A TELEVISION SET THAT WON’T HAVE A TARIFF EFFECT. >> THOSE THINGS ARE HAPPENING OVERNIGHT. THEY ARE ALREADY SELLING THESE DEVICES AND THESE TELEVISIONS. BUT HAS BEST BUY STARTED TO SHIFT AWAY? AND HOW MUCH WILL THAT COST THE COMPANY? THAT IS SOMETHING THAT TAKES MONTHS. >> IT TAKES YEARS. THE WORST SCENARIO OUT THERE RIGHT NOW FOR RETAILERS IS THE UNCERTAINTY SURROUNDING A, IF THE TARIFFS WILL BE IMPLEMENTING AND B, WHAT WILL THE LEVELS BE? AND C, HOW LONG WILL THEY LAST? IF YOU ARE A RETAILER AND YOU ARE REACTING TO THIS AND YOU OVERREACT, YOU WILL SPEND AN AWFUL LOT OF MONEY FOR NOTHING. IF YOU HAVE BEEN LIKE THE LARGE RETAILERS OVER THE YEARS AND YOU RECOGNIZE THAT YOU NEED A MORE DIVERSE SUPPLY CHAIN, THINK ABOUT WHAT HAS HAPPENED THE LAST SEVERAL YEARS IN RETAIL. WE HAVE HAD BANKRUPTCY. WE HAVE HAD STRIKES. WE HAVE HAD A SYNONYMY IN JAPAN WHICH DISRUPTED SUPPLY CHAIN. SO THE SAVVY BETTER CAPITALIZED RETAILERS HAVE ALREADY THOUGHT TO THEMSELVES, WE NEED MORE THAN JUST ONE BASKET TO PUT OUR EGGS IN AS FAR AS SOURCING IS CONCERNED AND THEY HAVE DONE THAT. BEST BUY HAS A VERY DIVERSE SOURCING NETWORK AND THEY HAVE A VERY BROAD PRODUCT LINE. I WILL JUMP INTO A DIFFERENT SECTOR. THE AUTO RETAILERS, WHICH I ALSO COVER. IF YOU WANT TO GET A CAR, EVEN IF THERE ARE TARIFFS BEYOND BELIEF, YOU WILL BE ABLE TO BY A CAR. YOU MAY NOT GET EXACTLY WHAT YOU WANT BECAUSE OF THE TARIFFS BUT YOU WILL BE ABLE TO GET SOMETHING. AND IF YOU CANNOT GET THE TARIFF VEHICLE, AND IF YOU GET A CERTIFIED PREOWNED TARIFF VEHICLE. >> SO DIVERSIFICATION IS KEY ON THAT FRONT. LET’S TALK ABOUT ANOTHER RETAILER THAT REPORTED. ABERCROMBIE AND FINCH SLUMPING AFTER QUARTERLY SALES MISSED EXPECTATIONS. THE RETAILER ALSO CUT ITS FULL YOUR CEREALS SALES FORECAST BECAUSE OF THE TARIFF POTENTIAL IMPACT. WHAT IS THE STORY ON THAT. >> I WILL JUST MAKE A BROAD STATEMENT ABOUT SMALLER RETAILERS. THEY HAVE ISSUES BEYOND TARIFFS AND EVERYTHING ELSE. THIS IS NOT JUST ABERCROMBIE. THIS IS, I THINK WE HAVE 14 NAMES AND ABERCROMBIE IS NOT ON THE LIST. BUT THEY ALL HAVE ISSUES. AND TARIFFS CAN BE THE STRAW THAT BREAKS THE CAMEL’S BACK. THEY HAVE ISSUES SURROUNDING CAPITAL STRUCTURES. THEY HAVE ISSUES SURROUNDING COMPETITION. THEY HAVE BEEN DEALING WITH THIS PRICE OR WITH AMAZON AND WALMART. BEING ONLINE IS TOUGH. THINK ABOUT IT. ALL THE SUDDEN, TARIFFS HIT. AND YOU HAVE TO BE SAYING, WHAT ELSE CAN GO WRONG HERE? YOU ARE LOOKING OUT THE WINDOW FOR THE FLOOD. AND IT IS HARD. YOU ARE GOING TO SEE A LOT OF VARIABILITY. YOU GET AWAY FROM THE TOP GUYS IN RETAIL. ANYBODY BELOW THEM, YOU WILL SEE VARIABILITY AND OPERATING PERFORMANCE AND IT WILL DIFFER QUARTER OVER QUARTER WHICH IS TOUGH. AND IT IS TOUGH FOR THE MANAGEMENT TEAMS FOR A LOT OF THEM TO MAKE THE SHORT-TERM INVESTMENTS THEY NEED FOR THE LONG-TERM BENEFIT LIKE WALMART DID, TARGET AND THE REST. >> AND YOU TALK ABOUT THE SMALLER PLAYERS. DID YOU PUT FOREVER 21 IN THAT TOO? >> IT IS A TOUGH SITUATION. TOO MUCH DEBT. DEBT ALWAYS WINS IN RETAIL. YOU CANNOT OUTRUN THE CAPITAL STRUCTURE. WHEN YOU ARE HIGHLY LEVERAGED WITH A LOT OF DEBT ON YOUR BALANCE SHEET, YOU DON’T HAVE THE FLEXIBILITY TO DO THE THINGS WE TALKED ABOUT ON THE INVESTMENT SIDE. >> LET’S TALK ABOUT THE BACKDROP WITH WHICH THIS IS PLAYING OUT. WE HAD STRONG RETAIL SALES THAT CAME OUT IN JULY. HOW BIG OF A HIT IS THAT LIKELY TO TAKE WHEN SEPTEMBER 1st TARIFFS TAKE EFFECT? >> IF THEY TAKE EFFECT AND WE ARE ONLY A FEW DAYS AWAY, I UNDERSTAND THAT. AND HOW LONG DO THEY LAST? HOW DEEP DO THEY GO? THIS IS A REALLY FLUID SITUATION. AND IT IS PROTRACTED. THERE IS A LOT OF RHETORIC OUT THERE. A LOT OF NEGOTIATING GOING ON. WE HAVE TAKEN A VIEW THAT WE HAVE TO BE PATIENT AND OUR ASSESSMENT OF THE TARIFF IMPACT BECAUSE WE HONESTLY DON’T KNOW HOW LONG IT WILL LAST AND WHAT STEPS RETAILERS HAVE BEEN TAKING. WE HAVE BEEN TAKING A VIEW ON AN INDIVIDUAL RETAILER BASIS AND TRY TO ASSESS A TARIFF IMPACT FROM THAT PERSPECTIVE. I THINK IT IS NOT UNFAIR BUT IT MAY BE HARD TO PAINT ALL OF RETAIL WITH A VERY BROAD BRUSH WITH RESPECT TO WHAT WILL HAPPEN WITH TARIFFS. >> WE DEFINITELY LEARNED THAT THROUGH THIS EARNINGS SEASON. CHARLIE, GOOD TO HAVE YOU ON.>> THIS WEEK ON INFLUENCERS, YAHOO FINANCE EDITOR AND CHIEF AND HE WILL SIT DOWN WITH JOHN. THE TECH EXECUTIVE WEIGHS IN ON PRESIDENT TRUMP’S NEGOTIATING TACTICS. TAKE A LISTEN. >> IS DONALD TRUMP GOOD FOR BUSINESS? HE SAYS HE IS. JUST POINTS TO THE SCOREBOARD. LOOK AT THE GROWTH, THE ON EMPLOYMENT AND THE STOCK MARKT. >> FOR IF DONALD TRUMP IS GOOD FOR BUSINESS, I THINK DONALD TRUMP, I WOULD NOT VOTE FOR HIM. I DON’T THINK HE IS GOOD FOR THE COUNTRY. I THINK HE IS A PRODUCT OF THE DISLOCATION WE ARE GOING THROUGH. AND THAT IS AT SO MANY LEVELS. A PRODUCT OF THE FINANCIAL CRASH ALL THE WAY THROUGH TO THE ECONOMIC DISLOCATION. A PRODUCT OF THAT. AND A PRODUCT OF THE MEDIA SYSTEM WE HAVE CREATED. AND THAT HE HAS HELPED CREATE. HE IS NOT ONLY ONLY A MIRROR BUT HE IS IN THERE HIMSELF. AND SO, IS HE GOOD FOR BUSINESS? I THINK THE ECONOMIC PROSPERITY AND THE RUN THAT WE ARE ON NOW STARTED WAY BEFORE HIM. AND IT WILL WE BE AT SOME POINT BECAUSE CYCLES DEAL. AND I THINK THAT HE HAS THE UNPROTECT ABILITY AND HIS LEAVE NEGOTIATING AND IT IS NOT GOOD FOR BUSINESS. >> YOU CAN CATCH THE FULL EPISODE OF INFLUENCERS TONIGHT AT 5:00 P.M. EASTERN ON YAHOO FINANCE. >> COMING UP, THE DOLLAR STORE GIANTS ARE SEARCHING AND SHAKING OFF THE TRADE WAR CONCERNS. >> AND TESLA’S BIG GAMBLE TO SHAKE UP THE CAR INSURANCE INDUSTRY. A STAY WITH US. >>> LET’S GET OUT TO SCOTT DOWN. A COUPLE OF THINGS TODAY SPARKING THE RALLY. YOU HAVE POSITIVE TRADE HEADLINES COMING OUT OF CHINA SUGGESTING FOLLOWING TENSIONS BETWEEN THE U.S. AND CHINA. NOTHING EXACTLY CONCRETE. BUT THE MARKET WILL TAKE ANY GOOD HEADLINE IT CAN GET. ON THE FLIPSIDE, YOU ALSO HAVE A REBOUND IN TREASURY YIELDS ACROSS THE BOARD ALTHOUGH THE TWO-YEAR YIELD IS STILL ABOVE THE 10 YEAR YIELD WITH THE FACT THAT THE 10 YEAR YIELD HAS CROSSED BACK ABOVE 1.5%, IS AN ENCOURAGING SIGN FOR INVESTORS AT LEAST FOR TODAY. WHEN IT COMES TO INDIVIDUAL SCOTT STOCKS, WE HAVE A REACTION TO EARNINGS REPORTS WHICH TRADITIONALLY DRIVES THE MARKET. TODAY WE HAVE DOLLAR GENERAL SURGING. THE BEST PERFORMANCE STUCK IN S&P 500 UP OVER 11.5%. THE SAME STORE SALES ROSE 4% YEAR AFTER YEAR AND THE COMPANY RAISED GUIDANCE EVEN WITH THE UNCERTAINTY FROM THE TRADE WARS. AND WE ARE KEEPING AN EYE ON SHARES OF UNITED RENTALS. THAT STOCK IS UP 5%. IT IS ONE OF THE BEST PERFORMING STOCKS IN THE S&P 500. NOT A LOT OF HEADLINES SURROUNDING UNITED RENTALS TODAY. WITH THE HURRICANE EXPECTED IN FLORIDA THIS WEEKEND, THAT COULD SPUR EXTRA DEMAND FOR EQUIPMENT RENTALS FROM UNITED RENTALS IF THERE IS INDEED DAMAGE FROM THE HURRICANE. AND FINALLY, BED, BATH AND BEYOND SHARES ARE UP OVER 10% ON A REPORT FROM THE DEAL WHICH IS A PUBLICATION SAYING THAT THE COMPANY HIRED GOLDMAN SACHS AND RECEIVED ADDITIONAL OFFERS FOR VARIOUS BUSINESS UNITS WITHIN BED BATH & BEYOND. AKIKO. >> THANK YOU, SCOTT. LET’S DO A DEEPER DIVE INTO THE STOCKS SCOTT JUST MENTIONED. DOLLAR TREE AND DOLLAR GENERAL. THE DISCOUNT RETAILERS BOTH TAPPING REVENUE ESTIMATES AND SEEING AN INCREASE IN SAME STORE SALES FOR THE QUARTER. WE ARE BREAKING THIS DOWN. WE ARE SEEING A TALE OF TWO DIFFERENT STOCKS. DOLLAR TREE DOWN. DOLLAR TREE SURGING. >> DOLLAR TREE IS DOWN. IT HAD OPENED UP EARLIER THIS MORNING BUT LOST SOME OF ITS STEAM. THE REVENUE WAS UPBEAT. EARNINGS CAME IN BELOW EXPECTATIONS. STEAM STORE SALES WERE UP 2.4%. AND THAT WAS BETTER THAN WHAT WAS EXPECTED. THE STORY HERE IS THAT THESE COMPANIES HAVE BEEN ABLE TO NAVIGATE THE UNCERTAINTY SURROUNDING THE U.S. CHINA TRADE WAR AND THE TARIFFS. AND THAT IS REALLY WHAT HAS BEEN TALKED ABOUT WHEN YOU LOOK AT DOLLAR TREE. THEY SAID THAT THEY ARE MITIGATING TARIFF IMPACT AND TESTING PRICE POINTS AND WORKING WITH SUPPLIERS AND THEY HAVE BETTER ASSORTMENTS OF THE PRODUCT. AND DOLLAR GENERAL AS WELL IS SAYING THAT THEY PLAN TO MITIGATE A TARIFF IMPACT. THEY ALSO HAVE MADE AN IMPROVEMENT TO THE STORE. SO THEY HAVE A SELF CHECK OUT ADDING NEW PRODUCTS. AND THEY HAVE THIS THING CALLED FASTTRACK WHICH BASICALLY IMPROVES THE AMOUNT OF TIME, REDUCES THE AMOUNT OF TIME, THAT IT TAKES TO GET PRODUCTS FROM THE TRUCK TO THE SHELF. THEY HAVE BEEN ADDING ALSO FROZEN FOODS WHICH HAS HELPED QUITE A BIT AS WELL. >> AND A LOOKING AT THE RETAILERS, INES, IT SEEMS WE ARE SEEING A TALE OF TWO’S. ON ONE HAND WE HAD LUXURY RETAILERS LIKE TIFFANY’S AND TAPESTRY UNDER PRESSURE TODAY. YOU MENTIONED THESE STORES, WE HAD TJX AS WELL. ARE WE SEEING THESE RETAILERS PERFORM BETTER BECAUSE, AS THE COSTS MOUNT AND THERE ARE CONCERNS ABOUT CONSUMERS HOLDING BACK, WE ARE TALKING ABOUT DISCOUNTS. >> THAT IS RIGHT. IT IS SOMETHING WE ARE SEEING. EVEN AT FIVE BELOW, THEY REPORTED THE EARNINGS YESTERDAY AFTER THE CLOSE. AND FIVE BELOW TODAY WAS SEEING A POP BASED ON THE PERFORMANCE THAT THEY HAD IN THE LAST QUARTER. WE ARE SEEING THAT THE CONSUMER SEEMS TO BE LIKING VALUE AND THAT IS SOMETHING, SINCE THE GREAT RECESSION, WHERE YOU HAD MILLENNIALS WATCHING THEIR PARENTS BASICALLY STRUGGLING DURING THE RECESSION. IT IS NOT A STIGMA ANYMORE TO BE GOING TO THESE VALUES STORES AND TO BE ABLE TO SHOP THERE AND TO BE ABLE TO GO TO ANOTHER STORE, HIGHER END STORE, AND SHOP AS WELL AND WHEN IT COMES TO THE DOLLAR TREE OR DOLLAR GENERAL, THEY ALSO ARE COMPETING WITH WALMART AND E- COMMERCE. THERE IS NOTHING LIKE GOING INTO A STORE AND BEING ABLE TO GET ON A TREASURE AND SHOP AT A VERY LOW PRICE POINT AND ROUTE FINDING THOSE TREASURES. >> THANK YOU FOR THAT, INES. WE WILL CHECK BACK LATER WITH YOU IN THE SHOW. >> LET’S CHECK WITH TESLA. THEY ARE REVVING UP CAR INSURANCE. THE CARMAKER IS OFFERING INSURANCE FOR CAR OWNERS IN CALIFORNIA. SO TESLA’S ARGUMENT HERE, DAN, IS WE CAN OFFER RATES THAT ARE 20-30% LOWER. THE STOCK IS MOVING HIGHER ON THAT. >> YEAH, IF IT WORKS. BECAUSE IT’S NOT WORKING. THE TESLA WEBSITE RIGHT NOW, IF YOU GO TO TESLA.COM/INSURANCE WILL TELL YOU THERE IS AN ALGORITHM UPDATE AND PROCESS SO NOBODY CAN GET ON. THE REASON IS BECAUSE ORIGINALLY PEOPLE WERE SEEING RATES THAT WERE HIGHER THAN WHAT COMPETING INSURANCE COMPANIES WERE OFFERING. THE IDEA IS THAT YES, TESLA UNDERSTANDS THE VEHICLES BETTER THAN OTHER PEOPLE, SO IT WOULD BE ABLE TO OFFER INSURANCE AT A BETTER RATE. THE ISSUE HERE IS THAT THE TESLA WAS MORE EXPENSIVE TO INSURE THEN OTHER CARS. IN FACT, THE MOST EXPENSIVE TO ENSURE IN 2018 BECAUSE OF THE PRICE AND BECAUSE OF THE RARITY OF THE MATERIALS NEEDED TO REPAIR THEM IF THERE WERE ISSUES. THOSE RATES HAVE COME DOWN BECAUSE OF THE INTRODUCTION OF AUTOPILOT. THE DRIVER ASSIST FEATURES. AGAIN, IT IS NOT FULL SELF DRIVING. IT IS DRIVER ASSIST. THEY MANAGED TO TAKE THE RATES DOWN. THIS WILL BE AVAILABLE IN CALIFORNIA RIGHT NOW AND THEN WE’LL SPREAD OUT ACROSS THE COUNTRY FOR THE REST OF THE YEAR BUT YOU CAN’T GET TO IT. CALIFORNIA, ONE OF THE STATES WITH THE HIGHEST INSURANCE RATES. SURPRISINGLY NEW YORK AND NEW JERSEY ARE NOT UP THERE. I ALWAYS THOUGHT THEY WERE. MICHIGAN, NUMBER ONE ACCORDING TO ENSURE.COM. IT WILL BE INTERESTING TO SEE WHAT WILL HAPPEN WHEN THIS COMES BACK ONLINE. IT STILL SAYS ALGORITHM UPDATE AND PROCESS. THE IDEA IS THAT YOU WOULD BE ABLE TO GET ON THE TESLA WEBSITE AND GET INSURANCE IN ABOUT ONE MINUTE. THEY OBVIOUSLY ARE TRYING TO BE THE ONE STOP SHOP FOR DRIVERS. BUT HERE IS THE OTHER PROBLEM WITH THE TESLA PRODUCT. >> MAY BE GETTING A STEP AHEAD. LET’S TALK ABOUT ANOTHER ISSUE THAT HAS BEEN PLAGUING TESLA. THERE ARE MORE CASES OF TESLA MADE SOLAR PANEL FIRES. >> AFTER WALMART, THERE WAS THE AMAZON ISSUE WHERE THEY SAID THERE WERE FIRES ON TOP OF ONE OF THEIR FULFILLMENT CENTERS. THEY WERE USING SOME OF THE TESLA PANELS. THE PROBLEM SEEMS TO BE FROM THE ORIGINAL SUIT, THAT THERE WAS JUST GROSS NEGLIGENCE ON THE PART OF TESLA AND THE WAY IT INSTALLED THE PANELS. WALMART AND AMAZON, THESE COMPANIES WEREN’T SUPPOSED TO BE WORKING ON THE PANELS THEMSELVES. THEY WEREN’T, AS FAR AS WE KNOW. IT SEEMS LIKE TESLA WAS SUPPOSED TO BE THE COMPANY HANDLING THIS. BUT IF YOU HAD THESE ISSUES WITH BIG COMPANIES LIKE WALMART AND AMAZON COMING FORWARD AND SAYING, WE HAD PROBLEMS WITH TESLA’S OWN SOLAR PANELS AND WE DON’T TRUST THEM ANYMORE. WE WANT THEM REMOVED, THAT IS A BIG ISSUE. TESLA HAD GONE AHEAD AND INTRODUCED A RENTAL OPTION FOR CONSUMERS FOR SOLAR PANELS. BUT THEY JUST WEREN’T SELLING. THAT COULD COST UPWARDS OF $30,000 TO GET SOMETHING INSTALLED. AND WE STILL DON’T HAVE THE PANELS THAT WERE SUPPOSED TO BE LOOKING LIKE THE ACTUAL SHINGLES ON THE ROOF. THAT IS NOWHERE TO BE FOUND. THAT WAS SUPPOSED TO BE SOMETHING THAT CAME OUT. AND SAID, AS FAR AS THE SOLAR PROJECT, I DON’T KNOW WHAT THEY ARE DOING. >> WE WILL CONTINUE TO TRACK THE STORY. THANK YOU FOR THAT. LET’S MOVE ON TO THE THIRD TAKER OF THE DAY. THE STOCK IS UP AFTER THE CLOUD CONTENT MANAGEMENT SERVICE BEAT REVENUE ESTIMATES AND RAISED ITS FULL YEAR REVENUE GUIDANCE. JERROD IS HERE TO WALK US THROUGH THAT STORY. WHERE YOU LOOK AT THE HIGHS FOR THIS COMPANY, THEY ARE DOWN ROUGHLY 40%. SO YES THEY ARE SEEING A POP TODAY BUT THEY HAVE A LOT OF GROUND TO MAKE UP. >> THEY OPENED IT DOWN SEVERAL PERCENTAGE POINTS AT A THREE YEAR LOW. YOU WOULD HAVE TO GO BACK TO MONTHS AFTER THE IPO TO FIND THE PRICE THEY ARE PRETTY DEPRESSED RIGHT NOW. THEY DID RAISE THE FULL YOUR GUIDANCE BUT FOR THE 3rd QUARTER, THEY LOWERED IT A LITTLE BIT. SO BASICALLY THEY WERE BETTING ON THE 4th QUARTER. THEY ARE GOING TO THE TRANSITION NO AND CUTTING MARKETING EXPENSES TO UP THE AVERAGE TICKET PRICE. SO FAR, MAYBE IT IS WORKING AND MAYBE IT IS IN. LET’S CHECK OUT THE CHARTS AND SEE WHAT IS GOING ON. STARTING OUT IN THE RED. LET’S LOOK AT THE TWO-YEAR CHART. WE CAME DOWN AFTER THIS PEAK AND THEN IT HAS BEEN ACCELERATING TO THE DOWNSIDE. THIS IS MORE AKIN TO CATCHING A FALLING KNIFE. WE HAVE TO BE CAREFUL ABOUT THAT. THIS IS THE DROPBOX DOWN 37%. BOX VERSUS THE TRICK SWITCHES A MORE DIVERSIFIED COMPANY. >> TALK ABOUT A STOCK THAT HAS BEEN HURT. DOWN 50% FROM THE HIGHS WE SAW EARLIER TODAY. THEY ARE GETTING A HUGE POP TODAY AFTER REPORTING EARNINGS. >> I’M THINKING THIS IS SOME SHORT COVERING. IT WAS UP 25%. IT WAS UP 40% ON THE IPO DAYS. SO THE SECOND BEST PERFORMANCE. LET’S CHECK OUT WHAT WAS HAPPENING OVER A COUPLE OF YEARS. SIMILAR STORY FOR BOX AND DROPBOX. A STEADY DECLINE WITH ACCELERATION TO THE DOWNSIDE. NOT EXCITED ABOUT THIS PRICE ACTION. UP BY 25%. I THINK IT COMES BACK TO A LOT OF SHORT RECOVERY ON THIS ONE. >> THANK YOU FOR WALKING US THROUGH THAT. COMING UP, THE TRUMP ADMINISTRATION ROLLING BACK RULES ON METHANE EMISSION. DETAILS ON THE IMPACT IT COULD HAVE ON THE OIL AND GAS INDUSTRY. >> WHY THE PARENT COMPANY IS CALVIN KLEIN IS LEAVING DESPITE NEW WARNINGS ABOUT THE U.S. CHINA TRADE WAR. >>> BACK TO THE TICKER. I’M AKIKO FUJITA. BEST BUY IS TUMBLING AFTER MISSING ESTIMATE FOR SAME STORE SALES GROWTH IN THE 2nd QUARTER. THE ELECTRONICS RETAILER ALSO WARNING THAT A NEW ROUND OF U.S. TARIFFS ON CHINESE GOODS WILL SIGNIFICANTLY HIT SOME OF ITS MOST IMPORTANT PRODUCTS. ALSO ABERCROMBIE AND FITCH, THE RETAILER COMING UP SHORT OF ESTIMATES WITH ITS SECOND- QUARTER RESULTS. ABERCROMBIE IS CUTTING ITS FULL- YEAR SALES FORECAST CITING PENDING TARIFFS AS WELL AND THEIR IMPACT ON MERCHANDISE COST. YOU CAN SEE THE STOCK DOWN MORE THAN 13% RIGHT NOW. WE ALSO LOOKED AT DOLLAR GENERAL WHICH POSTED SECOND- QUARTER RESULTS. AND STATING IT IS WELL SITUATED TO HANDLE THE FLOW FROM ANY OF THE TARIFFS IN THE U.S. CHINA TRADE FIGHT. IN THE COMPANY IS BOOSTING THE FULL-YEAR FORECAST. LET’S CHECK THE CLOSING PRICE OF OIL. WE HAVE SEEN IT PUSH ABOVE THE $56 A BARREL MARK. 56, 35. A 1% GAIN. THIS COMING AS THE TRUMP ADMINISTRATION REVEALS THAT IT IS LOOKING TO ROLLBACK OBAMA ERROR RULES ON METHANE EMISSIONS JOINING US IS MATT SHAPIRO, THE PRESIDENT OF NWS CAPITAL CONSULTNTS. LET’S START WITH THE NEWS ON THE ROLLBACK IN THIS REGULATION. IT HAS BEEN FRAMED AS AN ATTEMPT TO BOOST CRUDE OIL AND NATURAL GAS PRODUCTION. HOW MUCH OF A LIFT DO YOU THINK WILL COME OUT ON THE BACK OF THIS? >> FROM THE REPORTING, AKIKO, IT IS NOT A LOT. SOME OF THE MAJOR OIL COMPANIES OPPOSE IT A LITTLE BIT. BECAUSE EVEN THOUGH IT IS PART OF THE TRUMP ADMINISTRATION’S PLAN OF ROLLING BACK REGULATIONS AND IT MAKES HEADLINES, MOST OF THE MAJORS WANT TO SEEM LIKE THEY ARE COGNIZANT OF CLIMATE CHANGE AND THE DANGERS OF METHANE. RIGHT NOW IT IS PRETTY CONTROVERSIAL. IT IS NOT A MAJOR FACTOR IN THE OIL PRICE BUT IT IS MAKING A BIT OF HEADLINES TODAY. >> WHAT DO YOU THINK IS DRIVING THE PRICE OF OIL RIGHT NOW? >> SURPRISINGLY AKIKO, THE LAST TIME WE HAD INCREDIBLE GROWTH FEARS IN LATE 2015 AND 2016, OF COURSE WE HAD MORE OVERSUPPLY THEN WE HAVE NOW. REMEMBER THAT OIL FELL DOWN TO $30 PER GIVEN WHAT WE HAVE SEEN IN THE FIXED INCOME MARKET WITH THIS INCREDIBLE DROP IN YIELD AND THE BIG GROWTH FEARS, I’M PRETTY SURPRISED THAT OIL HAS HELD AT $56. ONE THING IS RIGHT AND ONE THING IS WRONG. EITHER OIL IS $56 AND GLOBAL DEMAND IS BETTER THAN PEOPLE THINK AND/OR INTEREST RATES ARE WAY TOO LOW. FOR NOW, I THINK IT IS VERY IMPRESSIVE THAT OIL IS HOLDING AT $56 A BARREL. >> LET’S TALK ABOUT ANOTHER STORY WE HAVE BEEN TRACKING IN THE OIL MARKETS. THE IPO. WE ARE GETTING REPORTS FROM THE WALL STREET JOURNAL SAYING THAT ARAMCO IS CONSIDERING A PLAN TO SPLIT ITS IPO INTO TWO STAGES. HE FIRST LISTING WILL H DOMESTICALLY AND THE SECOND LISTING, POTENTIALLY IN TOKYO. THAT WOULD RULE LONDON OUT AND HONG KONG OUT AS WELL. IS TOKYO A PLACE THAT WOULD MAKE SENSE? THE ARGUMENT HERE IS THAT THERE IS A LOT OF RISK ASSOCIATED WITH THE LONDON, BREXIT, HONG KONG AND THE PROTEST. TOKYO HAS BEEN LOBBYING FOR THIS AS WELL. IS THAT ONE THAT WOULD MAKE SINCE.? >> IT IS A HOT POTATO. IT WON’T BE LISTED HERE THE UNITED STATES BECAUSE ISSUES AROUND THEM BEING SUED. OBVIOUSLY LONDON IS NOT GOING TO GET IT. IT SEEMS LIKE IT WOULD BE LISTED OVERSEAS. THIS IS A BIG OFFERING. CURIOUS THAT TOKYO WOULD GET IT BUT I THINK IF HISTORY IS ANY GUIDE, ARAMCO SHARES WILL TRADE AT A PRETTY BIG DISCOUNT TO EARNINGS. MAYBE NOT SO MUCH OF AN ATTRACTIVE ISSUE FOR A LOT OF INVESTORS. LOOK AT THE OIL MAJORS IN THE UNITED STATES. THOSE ARE STOCKS THAT HAVE BEEN PRETTY MUCH LEFT FOR DEAD. SO MAYBE IF THEY PUMP OUT JUST A LITTLE BIT OF THE DIVIDEND, THAT WILL BE ATTRACTIVE FOR JAPANESE INVESTORS. >> IT WILL BE INTERESTING TO WATCH THAT ONE ESPECIALLY GIVEN THAT SO MANY OF THE IPOS IN JAPAN TRADE ON RETAIL INVESTORS AND NOT INSTITUTIONAL ONES. WHEN YOU LOOK AT WHAT ARAMCO HAS BEEN TRYING TO DO OR RATHER WHAT THE KINGDOM HAS BEEN TRYING TO DO, IS DIVERSIFY AWAY FROM OIL. THIS HAS BEEN THE LINCHPIN OF THE ENTIRE PLAN. HAVING SAID THAT, DO YOU THINK IT MAKES SENSE FOR ARAMCO TO COME TO MARKET AT CURRENT PRICES? >> THEY HAVE TO GET IT GOING. IF THEY DON’T MOVE ON IT, IT IS JUST GOING TO BE FORGOTTEN AND PUSHED BACK. SO THEY MIGHT AS WELL TRY IT. BUT SEEING THESE BIG MAJOR GLOBAL ISSUES LIKE IN CHINA OR THIS ONE, I’M NOT SAYING IT IS NOT GOING TO BE A GOOD ISSUE OR SOMETHING WORTHWHILE TO INVEST IN BUT FOR UNITED STATES INVESTORS, IT WOULD BE SUCH A STEEP DISCOUNT TO THE EARNINGS BECAUSE OF THE SUPPORT AND THAT IT IS OWNED BY THE STATE AND THE OPAQUENESS, IF YOU WILL, WITH EARNINGS AND PRODUCTION. AND ALL THE ISSUES SURROUNDING SOVEREIGN OWNERSHIP OF THE COMPANY. FOR UNITED STATES INVESTORS, MAYBE NOT SO ATTRACTIVE. SO I THINK THEY ARE LOOKING FOR JAPANESE AND JAPAN RETAIL INVESTORS TO MAYBE PICK UP SOME OF THAT INTEREST. >> OKAY, MATT SHAPIRO. GOOD TO TALK TO YOU. APPRECIATE YOUR TIME. >> THANK YOU. >> LET’S GET TO THE NEXT THREE TICKERS. PBH, THE PARENT COMPANY OF CALVIN KLEIN IS LEAPING DESPITE LOWERING ITS OUTLOOK. NEW DATA REVEALING THE APPLE DEPENDENCE ON CHINA AND DISNEY’S NEW STREAMING SERVICE MAY BLOW OUT EVEN THE HIGHEST OF EXPECTATIONS. FIRST TO APPLE. THE INVITES ARE OUT FOR SEPTEMBER 10th. FOR THE NEW IPHONES BEING UNVEILED. DAN HAS BEEN TRACKING ALL OF THOSE DETAILS FOR US. WHAT ARE THE RUMOR MILLS SAYING AND WHAT WILL HE BE LOOKING FOR IN THESE NEW DEVICES? >> BIG SURPRISE. IPHONE. THAT IS IT. SUPPOSEDLY WHAT WE WILL SEE IS THREE DEVICES. ONE IS AN ENTRY-LEVEL DEVICE SIMILAR TO THE 10R ALREADY OUT THERE. WE DON’T KNOW WHAT THE NAME WILL BE. SECOND TWO WILL BE SIMILAR TO THE 10S AND THE 10S MAX OUT THERE. THOSE ARE BEING RUMORED TO BE CALLED PRO IPHONES. SO IPHONE PRO SIMILAR TO MACBOOK PRO. THOSE WOULD BE THE HEIGHT END DEVICES. THE ONES THAT ARE $1000 AND UP. THEY ARE ALSO SAYING THAT WE COULD SEE AN ADDITIONAL IPAD AS WELL AS A LARGER MACBOOK PRO AT 16 INCHES. THEY HAVE NEVER GONE TO A 16- INCH SIZE. THEY HAVE HAD LARGER. THE 15-INCH IS REALLY THE BIGGEST THEY HAVE. 16 WOULD BE BIGGER. AND THEY ARE ALSO TALKING ABOUT A NEW APPLE WATCH. THAT WOULD HAVE A TITANIUM BACKING OR CERAMIC BACKING. WE REALLY ARE NOT HEARING ANYTHING AS FAR AS NEW FUNCTIONALITY FROM THE APPLE WATCH OUTSIDE OF POTENTIALLY MORE IMPROVEMENTS TO THE OPERATING SYSTEM. SO MAYBE A LITTLE BIT OF A SPEED BOOST BUT NOTHING REALLY GAME CHANGING FOR THE WATCH ITSELF. THE AIR PODS ALSO ARE SUPPOSED TO GET AN UPDATE AS WELL. THOSE ARE SUPPOSED TO BE WATER RESISTANT WHEREAS THE CURRENT ONES ARE NOT. BUT KIND OF ARE. IF YOU SWEAT ON THEM, YOU ARE NOT GOING TO BREAK THEM. PEOPLE WEAR THEM WHEN THEY WORK OUT. THESE ARE SUPPOSED TO BE MORE ROBUST AS FAR AS WATER RESISTANCE. >> THE BIG QUESTION WHEN IT COMES TO IPHONES IS HOW SIGNIFICANT IS THE CHANGE? AND WILL IT CONVINCE OR ENTICE THE CURRENT CONSUMERS TO UPGRADE? WE GOT THESE NUMBERS OUT A FEW DAYS AGO SUGGESTING THAT GLOBAL SALES FOR SMART PHONES ARE CONTINUING TO DECLINE. DOWN 1.7%. SAMSUNG SAW A BOOST AFTER SIX STRAIGHT QUARTERS OF DECLINE. BUT THE APPLE IPHONE CONTINUING TO FALL. SO ARE THESE DEVICES GOING TO BE ENOUGH, THE FUNCTIONS YOU TALKED ABOUT, ENOUGH TO GET CONSUMERS BACK IN AND SAY, I NEED AN UPGRADE NOW?>> I THINK THE ISSUE IS NOT WHETHER OR NOT THE DEVICES ARE SEXY ENOUGH FOR PEOPLE TO GO, I NEED THAT RIGHT NOW. BUT MORE ALONG THE LINES OF, DOES MY CURRENT PHONE WORK? THAT IS WHERE PEOPLE ARE NOW. ESPECIALLY WITH PRICES AS HIGH AS THEY ARE. WE DON’T HAVE THE TWO-YEAR SUBSIDIZED SMART PHONES. WE ARE OFF THE TWO-YEAR CYCLE. THAT IS WHERE THIS STARTED TO TAKE PLACE. WHERE PEOPLE REALIZE, I DON’T NEED TO UPGRADE EVERY TWO YEARS. I CAN KEEP THE SAME PHONE AND CONTINUE ON MY CONTRACT. THESE NEW PHONES ARE SUPPOSED TO HAVE AN EXTRA CAMERA LENS AND UPGRADES AS FAR AS THE DISPLAY AND AS FAR AS THE ID GOES. THERE ARE IMPROVEMENTS HERE BUT IT IS NOT GOING TO BE A COMPLETELY NEW DEVICE. I THINK THE BIG SELLER IS GOING TO BE NEXT YEAR WHEN THE 5G COMES OUT. THAT WILL BE SOMETHING WHERE PEOPLE SAY THEY NEED THE 5G PHONE. WHEN YOU THINK ABOUT WHEN THE FIRST NUMBER G LTE PHONE CAME OUT, PEOPLE STARTED GOING BANANAS. PEOPLE WILL BE A LITTLE BIT BEHIND THE CURVE AS FAR AS 5G. BUT RIGHT NOW FIVE, G IS AVAILABLE IN A HANDFUL OF PLACES. IF YOU HAVE A 5G PHONE, YOU WILL BE PAYING MORE FOR THE PLAN AT THIS POINT TO USE IT. SO IT DOES NOT MAKE SENSE FOR A LOT OF PEOPLE TO PURCHASE THEM. WHEN APPLE’S COMES OUT, IT WILL MAKE SENSE. >> AND THERE ARE REPORTS OF THE 5G PHONES OVERHEATING. WE ARE A LITTLE WAY AWAY FROM SEEING THAT HIT THE MARKET. >> THE NEXT TICKER IS PVH, WHO OWNS BRANDS LIKE TOMMY HILFIGER. IT CITED WEAKER TRAFFIC TRENDS IN NORTH AMERICA AND CHINA IN ITS VERY IS BACK WITH ME. SO THAT CONTRIBUTED TO THE WEAKER TRAFFIC. >> STARTING WITH CHINA. THEY SAID THEY SAW DECELERATION AND TRAFFIC. THIS HAS TO DO WITH TRADE TENSIONS. THEY ALSO CITED THE PROTEST IN HONG KONG. THEY ALSO CITED THE STRONGER DOLLAR. AND WHEN YOU MOVE OVER TO THE U.S., THEY CITED THAT THEY HAD WEAKER TRAFFIC IN THE OUTLET MALLS. THIS IS BECAUSE OF LESS FOREIGN TOURISTS. FOREIGN TOURISM ACCOUNTS FOR 35- 40% OF THE OUTLET BUSINESS IN NORTH AMERICA. SO OF COURSE SEEING SOFTNESS IN INTERNATIONAL TOURISM WILL TRANSLATE INTO THE SALES. AND SO THEY HAD TO DO A LOT OF PROMOTIONS FOR THE QUARTER. SOME BIG PROMOS BECAUSE THEY JUST HAD A CHALLENGING QUARTER WITH THE U.S. TRAFFIC. ONE BRIGHT SPOT, AKIKO, IS THEY SAW THAT THE EUROPEAN BUSINESS OUTPERFORM DESPITE THIS MACRO UNCERTAINTY AND DESPITE BREXIT. THEY SAID THEY HAVE A DEEP UNDERSTANDING OF THE EUROPEAN MARKET. >> EVERY RETAILER IS LOOKING AT THE UPCOMING TARIFFS ON SEPTEMBER 1st TO SEE, WHAT IS THE ADJUSTMENT WE HAVE TO MAKE? AND I KNOW THE CEO WAS ASKED ABOUT THIS ON THE EARNINGS CALL. WHAT SPECIFICALLY DID HE POINT TO IN TERMS OF WHAT THE COMPANY IS DOING? >> HE POINTED TO COST MITIGATION. HE TALKED ABOUT WORKING WITH RETAIL PARTNERS. HE SAID YOU CAN’T REALLY INCREASE THE PRICE IN A SHORT PERIOD. HE SAID THE ENVIRONMENT IS JUST NOT THERE TO WITHSTAND PRICE INCREASES. GOING INTO 2020, HE POINTED TO THE FACT THAT THEY HAVE MOVED A LOT OF THE PRODUCTION WHERE POSSIBLE OUT OF CHINA. SO THEY HAVE BEEN MAKING PLANS AND THEY ARE LOOKING TO DO SOME SPECIFIC PRICE INCREASES WITH CONSUMERS. TARGETED PRICE INCREASES WITH CONSUMERS IN 2020, AKIKO. >> THANK YOU FOR THAT. LET’S MOVE ON TO THE SIXTH TICKER OF THE DAY. THAT IS DISNEY. THE NEW STREAMING SERVICE COULD BE A MASSIVE HIT IN THE U.S. ACCORDING TO UPS. ACCORDING TO 1000 CONSUMERS, THEY FOUND 47% SIX GO TO THE SERVICE AND 24% EXTREMELY LIKELY TO SUBSCRIBE. JARED AS BACK WITH ME TO WALK US THROUGH THIS. SO IF YOU ARE NETFLIX OR AMAZON, YOU ARE LOOKING THIS AND SAYING, HOW MUCH OF THIS WILL COME TO THE EXPENSE OF OUR SUBSCRIBERS? >> THAT IS THE KEY QUESTION. THE STREAMING WARS AND THEY WILL HEAT UP, IN THIS PARTICULAR SURVEY, I BELIEVE 57% OF THE PEOPLE WHO SAID THEY WOULD SUBSCRIBE TO DISNEY SAID THEY WOULD CANCEL AT LEAST ONE OF THE OTHER SERVICE. SO IT WILL BE A MATTER OF PICKING WINNERS AND LOSERS. FOR DISNEY, THIS COULD BE PRETTY BIG. IF YOU BELIEVE THE NUMBERS IN THE SURVEY AND THEY TRANSFER TO REAL-WORLD RESULTS, CONSIDER WE HAVE 100,000 HOUSEHOLDS IN THE U.S. AND A 43% OF THEM ARE SIGNING UP FOR THIS, DISNEY WOULD EXCEED THEIR TARGET FOR FIVE YEARS DOWN THE LINE. THEY PLAN TO GET 20-30 MILLION HOUSEHOLDS REACHED. SO THEY COULD THEORETICALLY GET THAT THE FIRST YEAR. DEPENDENT UPON EXACTLY WHAT THE DYNAMICS ARE AND HOW THEY PLAY OUT WITH THE OTHER SERVICES. A LOT OF WHICH ARE COMING OUT AT THE SAME TIME. >> I KNOW YOU HAVE ALL THE STREAMING STOCKS LINED UP. HOW IS DISNEY TRADING COMPARED TO OTHER COMPETITORS? >> WE CAN SEE THAT EVERYTHING IS UP TODAY. A BULLISH DAY OVER WALL STREET. APPLE IS DOWN A HALF OF A PERCENTAGE. DISNEY IS DOWN 5%. NETFLIX DOWN 10%. LET’S GO BACK YEAR TO DATE. ANOTHER PICTURE EMERGES. EVERYTHING IS IN THE GREEN. APPLE IS UP 32%. AT&T UP 20. DISNEY, 27. NETFLIX UP 11-12%. AND IF WE SEE THE STOCK, IT HAS TAKEN A DIVE RECENTLY. THIS IS YEAR TO DATE. IF WE LOOK THE LAST TWO MONTHS, WE CAN SEE THAT IT IS DOWN NEARLY 18-19% HERE. I THINK NETFLIX IS PROBABLY THE BIGGEST LOSER IN THE STREAMING WORLD BECAUSE THEY WERE THE FIRST MOVER. THEY HAVE THE BIGGEST COMPETITIVE ADVANTAGE. AND A LOT OF THE CONTENT IS SIMPLY DISAPPEARING TO A LOT OF THE OTHER STREAMING SERVICES. >> NETFLIX HAVING TO RETOOL ALONG WITH OTHER COMPETITORS COMING INTO THE MARKET. THANK YOU FOR THAT. >> BETTING ON THE BEVERAGE INDUSTRY. THE GLOBAL FOOD AND BEVERAGE INDUSTRY IS EXCITED TO REACH $80 BILLION IN REVENUE THIS YEAR ACCORDING TO STATISTICS. AND THE CEO OF COCA-COLA BECHT STARTUP EXPLAINS THE POSSIBILITY OF THE IPO. YAHOO FINANCE FINANCE’S EMILY MCCORMICK JOINS ME. YOU HAD A CHANCE TO SIT DOWN WITH THE CEO. WE ARE NOT TALKING ABOUT AN IPO IN THE NEAR FUTURE, RIGHT? >> THE COMPANY WAS FOUNDED IN 2015. THE WELL-KNOWN BRAND UNDER THAT IS DIRTY LEMONS. THAT IS THE WOMEN BASED BEVERAGE. IS A WELLNESS DRINK. IT IS SUPPOSED TO BE A VITAMIN AND MINERAL IN LIQUID FORM IT. IT IS SOMETHING THE COMPANY HAS BEEN FORMULATING. THEY ARE TRYING TO EXPAND THE BRANDS THEY HAVE. IT WILL BE LESS THAN $100 MILLION THE NEXT 3-5 YEARS IN VARIOUS STARTUPS. BOTH CULTIVATED WITHIN THE BRAND AND OUTSIDE IN ORDER TO BUILD OUT THE PORTFOLIO. SO LET’S LOOK AT THE EXPECTATIONS. >> LET’S SAY JAMES QUINCY CAME KNOCKING ON THE DOOR AND SAID, WE WOULD LOVE TO ACQUIRE DIRTY LEMON OR IRIS NOVA IN ITS ENTIRETY. WOULD YOU SAY YES TO AN OFFER LIKE THAT? >> OBVIOUSLY WE ARE NOT BUILDING FOR THAT RIGHT NOW. I THINK OBVIOUSLY IS A STARTUP, WE ARE LOOKING TO PROVIDE A RETURN FOR THE INVESTORS. I THINK THE EVENTUAL PATH TO EXIT IS THROUGH AN IPO WHERE WE CAN CONTINUE TO DO WHAT WE DO ON A MUCH LARGER SCALE. >> WE HAVE SEEN A LOT OF CONSUMER FACING IPOS THIS YEAR. SEEING UBER, LYFT. WHAT IS YOUR TIMELINE FOR THAT? >> WE WANT TO GET UP TO $100 MILLION IN REVENUE PROFITABLY. WITH THE PORTFOLIO BRANDS THAT WE HAVE A STAKE IN EACH OF THE BRANDS IN THE PORTFOLIO, AND I THINK THAT WILL HAPPEN IN THE NEXT 2-3 YEARS. >> I THINK ONE OF THE INTERESTING THINGS HE TOLD ME WAS THAT THEY ARE A COCA-COLA BECHT COMPANY. THEY HAVE $15 MILLION IN FUNDING FROM THEM AND CLOSED LAST YEAR AT A 60 MILLION- DOLLAR EVALUATION. THEY ARE TRYING TO COMPETE WITH THE COKE AND PEPSI OF THE WORLD BY BECOMING A PUBLIC COMPANY. HE TALKED ABOUT THE INEFFICIENCIES THAT HE FEELS EXIST WITH COKE BECAUSE HE SAID IT IS REALLY A BUSINESS-TO- BUSINESS TYPE OF COMPANY WHERE IT HAS TO SELL THE SYRUP TO THE RETAIL PARTNERS. AND THE RETAILERS THEMSELVES ARE THE CONSUMER COMPONENT. WHERE SOMETHING LIKE A DIRTY LEMON OR IRIS NOVA HAS A LOT MORE INTIMATE CONNECTION. YOU TEXT TO ORDER. 90% OF THESE ARE FILLED VIA TEXT MESSAGE. IT IS THE TYPICAL E-COMMERCE TYPE. >> AND NOT SO MUCH COMPETING ON THE SCALE. BUT ON THE SERVICE SIDE. AND THEY ARE OFFERING THE EXPERIENCE. >> EXACTLY. HE REALLY FRAMED IT AS A TECH COMPANY AS MUCH AS A BEVERAGE COMPANY. SO LITTLE SIMILARITY TO THINGS LIKE UBER. AND WHERE WE WERE AS OPPOSED TO JUST A REAL ESTATE COMPANY. >> INTERESTING. GREAT INTERVIEW. THANK YOU FOR THAT. >> COMING UP, WHY MARRIOTT IS MAKING SMALL TOILETRY BOTTLES A THING OF THE PAST. AND BMW IS PULLING BACK THE CURTAIN ON THE BLACKEST BLACK CAR YET. DETAILS NEXT. >>> PENDING HOME SALES FALLING 2.5% IN JULY COMPARED TO JUNE ACCORDING TO THE NATIONAL ASSOCIATION OF REALTORS. THIS RESULT COMES AFTER TWO MONTHS OF SALES GAINS AND FALLING MORTGAGE RATES. IT MAY BE A SIGN OF HOW SENSITIVE TODAY’S BORROWERS ARE TO EVEN THE SMALLEST MOVES IN RATES. JOINING US AS THE CHIEF ECONOMIST. IT IS GOOD TO HAVE YOU ON TODAY. >> LET’S START WITH A POSITIVE IN THE NUMBERS THAT CAME OUT TODAY. >> I WOULD SAY THE NEGATIVE IS ON A ONE-MONTH DECLINE. THE POSITIVE IS THAT PENDING SALES ARE RISING ON A YEAR-OVER- YEAR BASIS. I THINK TO THE EXTENT THAT WE LOOK OVER A LONGER PERIOD, THERE MIGHT BE GOOD NEWS THERE. >> AND THERE IS A BIT OF A MIXED BAG. ON THE ONE HAND, THE PRICES ARE SO COMPETITIVE, IT SIMPLY HAS NOT BOOSTED THE OTHER NUMBERS. >> I THINK THAT IS TRUE. WE SAW IN JULY THE EXISTING HOME SALE PRICES AT A MEDIAN LEVEL UP BY 4.3% YEAR-OVER- YEAR. THAT WAS THE 89TH STREET MONTH OF ANNUAL PRICE INCREASES. SO YOU ARE RELEASING THE BENEFIT FROM LOWER MORTGAGE RATES BEING OFFSET BY PRICES THAT ARE HIGHER FOR THE CONSUMER OVERALL. >> WE TALK ABOUT LOWER MORTGAGE RATES BEING A BIG CATALYST. IT DOESN’T SEEM LIKE WE HAVE SEEN THE KIND OF GROWTH YOU WOULD EXPECT FROM THE LOWER RATES. HOW MUCH OF THIS IS A BIT OF A LAG IN WHAT WE ARE SEEING IN THE MARKET VERSUS WHEN THE RATES COME DOWN? >> THERE IS A BIT OF A LAG FROM LOWER TREASURY RATES. I WOULD SAY WHERE WE ARE SEEING THE ACTIVITY IS IN THE REFINANCING ASPECT OF THE MARKET WHERE VOLUME IS UP ALMOST 50% JUST ON A MONTH ON MONTH BASIS. AND EXPECTED TO BE DOUBLE LAST YEAR’S SPACE FOR THE ENTIRE YEAR. I THINK THAT IS WHERE WE ARE SEEING SOME OF THE ACTIVITY. AS YOU MENTIONED, LESS SO ON THE ACTUAL SALES FRONT. >> YOU DESCRIBED THE NUMBERS WE GOT TODAY AS A BIT OF A MIXED BAG. WHAT ARE THE RED FLAGS THAT YOU ARE SEEING IN THEIR THAT CONCERN YOU? >> OVERALL, I’M CONCERNED ABOUT THE LACK OF CONSUMER CONFIDENCE. EVEN THOUGH IT HAS BEEN PRETTY ROBUST. TO WHAT EXTENT MIGHT THAT DETERIORATE AND CAUSE PEOPLE A LITTLE BIT OF CONCERN IN TERMS OF INITIATING A NEW PURCHASE. SOME OF THE POSITIVES OBVIOUSLY ARE THE FACT THAT WE HAVE HAD RISING INCOME THAT WE HAVE EVEN IF THEY ARE NOT RISING AS RAPIDLY AS OVERALL HOME PRICES. AND THE FACT THAT ON EMPLOYMENT RATES MAIN SO LOW. I AM A LITTLE BIT CONCERNED ABOUT THE CAUTIOUSNESS WE HAVE SEEN THROUGHOUT OTHER ASPECTS OF THE MARKET. >> WE HAVE HEARD ABOUT CONCERNS ON THE GROWING COST OF MATERIALS AND A LOT OF THE EARNINGS SAID WE HAVE GOTTEN SO FAR IN THIS QUARTER, HOW DOES THAT PLAY INTO THE HOUSING SECTOR AND WHAT ARE SOME OF THE CONCERNS ON THAT FRONT? >> CERTAINLY THE CONCERNS AROUND THE RAW MATERIALS AND WE START TO SEE THE IMPACT OF TARIFFS LEAD TO HIGHER INPUT PRICES. THAT COULD PUSH PRICES UP EVEN MORE OR SQUEEZE MARGINS FOR THE HOMEBUILDERS. úI WOULD SAY TO NOT SEEN COME AWAY FROM IMPORTED GOODS AND LABOR, WE HAVE SEEN A DECELERATION FROM A PPI PERSPECTIVE INTO THE INPUT OF RESIDENTIAL CONSTRUCTION. THE THINGS I WOULD WATCH FOR WOULD BE THE IMPACT OF TARIFFS. WE SEE THAT IN THE SECOND HALF OF THE YEAR. >> TALKING ABOUT WHAT IS ALREADY IN PLACE, WE HAVE TALKED SO MUCH ABOUT THE CONSUMER FACING PRODUCTS THAT WILL BE TAXED COME SEPTEMBER. WHAT SHOULD WE BE LOOKING FOR IN TERMS OF SPECIFIC MATERIALS? >> I WOULD LOOK AT SOME OF THE INPUT FROM OUR PERSPECTIVE. A POSITIVE THAT WE IMPORT INTO RESIDENTIAL HOUSING. OBVIOUSLY CHINA IS A BIG TRADING PARTNER FOR LUMBER. I WOULD EXPECT THAT IMPACT TO BE MINIMIZED WITH A NEW ROUND OF TARIFFS COMING IN. CERTAINLY, OTHER INPUT INTO FINISHED GOODS THAT ARE USED TO FINISH A HOME. THAT COULD BE A CONCERN, WHETHER IT IS CABINETRY OR CARPETING OR OTHER GOODS WERE CHINA IS A BIG SOURCE OF OUR IMPORTS. >> GOOD TO HAVE YOU ON TODAY. LET’S GIVE YOU A QUICK RECAP OF SOME OF THE TICKERS WE COVERED TODAY. THE FIRST TICKER WAS BEST BUY. THE STOCK PLUNGING AFTER REPORTING WEAKER THAN EXPECTED SALES GROWTH IN THE 2nd QUARTER. ALSO IN FOCUS, ABERCROMBIE AND FITCH DIVING AFTER REPORTING A LARGER THAN EXPECTED LOSS IN THE 2nd QUARTER. ALONG WITH THE FLAT SAME-STORE SALES. AND WE LOOK AT DOLLAR GENERAL REPORTING UNEXPECTEDLY STRONG EARNINGS IN THE LATEST QUARTER AND BOOSTING ITS FULL YOUR GUIDANCE.. >> TIME FOR THE LAST TICK OF THE DAY. MARRIOTT, THE WORLD’S LARGEST HOTEL CHAIN WILL ELIMINAE SMALL PLASTIC BOTTLES OF SHAMPOO, CONDITIONER AND BATH GEL FROM ITS ROOMS WORLDWIDE BY THE END OF 2020. THE BOTTLES WILL BE REPLACED BY WALL-MOUNTED DISPENSERS OR LARGE BOTTLES. INES, JARED AND DAN ARE BACK WITH ME TO WEIGH IN. IT IS INTERESTING. YOU SEE THIS WITH A LOT OF OTHER HOTEL CHAINS OUTSIDE THE U.S. THE LARGE BOTTLES MOUNTED AGAINST THE WALLS. SO YOU DON’T THROW OUT ALL THE PLASTIC BOTTLES EACH TIME. IS THIS KIND OF THE DIRECTION THAT A LOT OF THE HOTEL CHAINS ARE GOING IN? >> DEFINITELY. AND THE FACT THAT A LOT OF PEOPLE WON’T STEAL THEM. PEOPLE WILL BE ABLE TO. THEY WILL BE ATTACHED TO THE WALL. OVERALL IT SAVES MONEY. IT TAKES A WHILE TO CHANGE CONSUMER BEHAVIOR BUT WITH ENVIRONMENTAL CONCERNS AS THEY ARE, I THINK IT IS A NATURAL DIRECTION FOR PEOPLE. >> AND DAN, WHAT ARE YOUR THOUGHTS ON THIS? IS THIS THE DIRECTION COMPANIES HAVE TO TAKE, GIVEN HOW MUCH MORE ENVIRONMENTALLY CONSCIOUS CONSUMERS ARE BECOMING INCREASINGLY? >> I WONDER WHAT WILL HAPPEN. I PERSONALLY DON’T USE THESE WHEN I SEE THEM IN HOTELS JUST BECAUSE I USUALLY BRING MY OWN. I WONDER IF THAT MEANS WE WILL STOP SEEING THE LITTLE TRAVEL SIZED ITEMS OF THINGS LIKE SHAMPOO AND CONDITIONER AND TOOTHBRUSH AND TOOTHPASTE. THOSE ARE SMALL ITEMS THAT END UP GOING INTO THE TRASH OR MAYBE THEY DON’T EVEN GET RECYCLED. I WOULD LIKE TO SEE WHAT HAPPENS IN THAT MARKET. I THINK IT IS INTERESTING THEY ARE DOING THIS AND A SMART MOVE. >> IT IS INTERESTING. PEOPLE STILL DO PAKULA TRAVEL SIZE EVEN IF YOU DO IT YOURSELF. I GUESS THE IDEA BEING THAT IF YOU PACKED IT YOURSELF, YOU WILL USE IT. AND HOTELS, WE OFTEN USE HALF OF THE BOTTLE AND LEAVE IT BEHIND. >> THAT IS RIGHT. AND THIS IS SOMETHING THAT PEOPLE WHO ARE CONSCIOUS OF THIS, WILL SEE THIS AS SOMETHING GOOD. IN CALIFORNIA, THEY ARE CONSIDERING TO BAN THESE SMALL BOTTLES IN 2023 FROM HOTELS. CERTAINLY THIS IS A CONSCIOUS CONSUMER THAT THEY ARE CATERING TO. >> THANK YOU SO MUCH FOR THAT JERRED, INES AND DAN. LET’S GET A CHECK OF THE MARKET ACTION BEFORE WE SAY GOODBYE. SEEING THE BOWLS AND CONTROL OF THE STOCK RALLY. THE DOW IS UP 343 POINTS. THE S&P 500 UP 38. AND THE NASDAQ UP 119. THIS COMING ON THE BACK OF SOME OPTIMISM IN THE U.S. CHINA TRADE FRONT. GIVEN THE COMMENTS WE GOT FROM THE COMMERCE MINISTRY SAYING THAT THEY ARE LOOKING TO MAYBE LOOK FOR CALM NEGOTIATIONS MOVING FORWARD. WE WILL CONTINUE TO TRACK THAT STORY. THAT WRAPS IT UP FOR THE TICKER. STAY TUNED FOR THE FINAL ROUND COMING UP NEXT. >>>HELLO EVERYONE, I AM JEN ROGERS, THIS IS “THE FINAL ROUND”. STOCKS ARE BACK IN RALLY MODE AS BEIJING PULLS THE RHETORIC ON TARA FRATELLO TATIAN — TARIFF RETALIATION. WE HAVE THE MARKET ACTION COMING UP IN JUST A BIT. >>>FOREVER 21 IS NOT SO FOREVER ANYMORE. [ LAUGHTER ]>>WALL MAN. >>IT’S TOO EASY, YOU CAN’T JUST LEAVE IT. WE HAVE ANOTHER BANKRUPTCY FILING. WALL STREET IS EXCITED ABOUT THE IMPOSSIBLE WHOPPER. PLUS, CHRIS METZLER GIVES US HIS TOP LONG-TERM PICKS. WITH THIS OUR, ANDY SERWER, AND EDITOR AT LARGE, THE FIRST TRADE, BRIAN SOZZI TO TALK ABOUT TODAY’S MARKET ACTION. WE ALSO HAVE MARKET ACTION. THE RALLY CAPS ARE ON. THE STOCKS ARE HIGHER ON HOPES OF PROGRESS IN THE U.S. ON THE CHINA TRADE DISPUTE. LET’S SEE WHAT IS HAPPENING WITH THE DOW UP MORE THAN 350 POINTS. CATERPILLAR, J.P. MORGAN, CHASE, AND INTEL HAD SOME OF THE BIGGEST GAINS. THIS IS LIKE ANOTHER TWISTY, TOURNEY DAY. >>ONE SPOKESMAN SAID HE THOUGHT THE U.S. WOULD CANCEL THE ADDITIONAL TARIFFS TO AVOID ESCALATION IN THE TRADE WAR. HE CALLED FOR NEGOTIATIONS. SOME PEOPLE HAVE INTERPRETED THIS AS NO RETALIATION. THE FIRST ROUND OF TARIFFS ARE SET FOR SEPTEMBER 1, AROUND THE CORNER. THE PRESIDENT WAS ON FOX NEWS RADIO, AND HE MAINTAINED HE BELIEVED THE BEIJING WOULD MAKE A DEAL WITH UNITED STATES. HAS ANYTHING CHANGED ON TRADE? >>NO. >>I LOOK AT YOU, BECAUSE, IS THIS ACTUALLY A TRADE RALLY? ON-AGAIN OFF-AGAIN, WE SAID THIS AND THAT. HE WILL TWEET SOMETHING. WHY ARE PEOPLE BUYING ON THIS? >>FIRST FALL, PEOPLE ARE BOUNCING OFF OF THE LOW DIVIDEND. AS FAR AS THE TRADE NEWS GOES, YOU CAN READ A BIT INTO IT. THE QUESTION IS, ARE THE CHINESE BLINKING? ARE THEY ACTING LIKE GROWN-UPS? YOU CAN FIGURE OUT ONE WAY OR ANOTHER, TRY TO DECIDE WHAT IT IS. IT WOULD BE INTERESTING TO SEE IF PRESIDENT TRUMP CAN RESIST GLOATING ABOUT THIS. THE STATEMENT CAREFULLY. HE SAYS WE HAVE AMPLE MEANS OF RETALIATION. IT’S LIKE, RIGHT BACK HERE IS MY BIG HAMMER. >>IT DIDN’T SEEM LIKE THEY WERE BLINKING AT ALL WHEN YOU LOOK AT THE WHOLE STATEMENT. MAYBE THEY’RE SAYING, WE WILL BE THE GROWN-UPS HERE, LESSEE. >>YOU HAVE THE OPAQUENESS OF HER HAIR CHINA AND THE UNCERTAINTY OF DONALD TRUMP. HOW WOULD YOU LIKE TO INVEST OFF OF THAT? >>I IMAGINE WHEN THE TWO BIG ECONOMIES IN A TRADE WERE, PEOPLE ARE CONSTANTLY SAYING STUFF ABOUT WHERE TRADE STANDS. I DON’T KNOW IF EVERY LAST THING THAT IS THAT NEEDS TO BE A MARKET MOVING EVENT. THE MARKET IS UP A LOT. WE GET BACK INTO A CLEAN EXPLANATION OF WHY, WE CAN SAY STOCKS ARE DOWN A COUPLE WEEKS AGO, NOW THERE UP TODAY. >>THIS IS WHAT WE SAW YESTERDAY. THERE’S A LOT OF EARNINGS POWER IN THIS MARKET. WITH CORPORATE AMERICA, THEY GET A TRADE DEAL DONE. IDID TALK TO ABERCROMBIE AND FITCH, AND THEY’RE NOT WAITING FOR TRADE DEAL TO END. SHE’S MOVING PRODUCTION OUT OF CHINA IN A BIG WAY. ONCE I DO GET A DEAL, THERE IS A LOT OF EARNINGS POWER.:I WOULD ADD, WE DISCUSSED THIS YESTERDAY, WHEN THEY TALK ABOUT TREASURY YIELDS,THE TREASURY MARKET PRICED IN MOST OF THE RECESSION. NOW, DO WE GO TO A RECESSION OR NOT? THE GDP REPORT IS BACKWARDS AT THIS POINT. IF YOU DON’T THINK WE GO INTO RECESSION, THE MARKETS PROBABLY GONE TOO FAR. >>REMEMBE BEFORE, WHAT WOULD LIKE TO TRADE WORDS GOING TO AND, IN THE MARKET CREPT UP, THEN WE BACKED OFF. IT WILL BE PRICED IN. BY THE TIME WE GET THERE, BECAUSE DONALD TRUMP WILL NOT BE TO HELP HIMSELF, WERE GETTING CLOSE, WORLD WAS THERE, THE MARKET WILL GO UP 300 POINTS. WE MIGHT NOT GET ANYTHING. WE HAVE A 500 POINT SELL OFF THE NEXT DAY. >>CATERPILLAR IS THE BIGGEST MOVER ON THE DOW TO THE UPSIDE. IT’S UP 2.7%. WE ARE ALSO WATCHING APPLE. THAT CAN BE A TRADE PROXY. TIM COOK GETS WHAT HE WANTS BECAUSE HE CALLS THEM. HE’S MADE SOME GOOD POINTS. WE DO HAVE NEWS ON APPLE. THEY SENT OUT AN INVITE TO THE ANNUAL EVENT WE ARE EXPECTING A LOT OF NEWS. IT WILL BE HELD TUESDAY, SEPTEMBER 10 AT 10:00 P.M. PACIFIC TIME. THEY DID TEASE A LOGO SUGGESTING THE LAUNCH OF MORE COLORS OF THE NEW iPHONE MODELS. LOOK, THEY HAVE A LOT ON THEIR PLACE. THEY HAVE TARIFFS ON MAJOR PRODUCTS MADE IN CHINA, WIRELESS HEADPHONES, SMART WATCHES, COMING SEPTEMBER 1. THERE WILL BE A TARIFF ON THE iPHONE SET ON DECEMBER 15. HOW MUCH OF A CATALYST COULD THIS BE FOR APPLE STOCK? WILL BE AS EXCITED FOR NEW iPHONE MODELS? >>I’M ALREADY BORED. WE DON’T EXPECT TO GET A 5G iPHONE. EVEN STILL, THIS IS THE NEXT MAJOR CATALYST FOR APPLE IN TERMS OF HARDWARE. THAT WILL REIGNITE TALK OF THE SUPERCYCLE WHICH WE HEARD THE DID NOT HAPPEN. AMERICAN THAT IS A PHRASE I HEARD IN A WHILE. I HEARD THAT. >>I’M EXCITED ON A PERSONAL LEVEL. TO AGRO’S POINT, THESE EVENTS HAVE GOTTEN BOARDS AND IN BORING A TRADE. >>THERE TO HAMMER SERVICES. THAT INSULATE YOU FROM THE GLOBAL TRADE RISK. WE TALK ABOUT DOMESTIC SERVICES COMPANIES ARE THE PLACES TO BE THAT OUR CONSUMER FACING. THE EXTENT THAT THE BUSINESS IS MORE AND MORE ALL ABOUT THAT, THAT’S GREAT FOR APPLE AND APPLE SHAREHOLDERS. >>DID HAVE A LOT TO SAY ON THAT FRONT WITH THE APPLE STREAMING SERVICE. WE HAVE SO MANY DETAILS FROM DISNEY. THAT SLATE THEY RELEASED LAST FRIDAY IS MAKING PEOPLE THINK HARD ABOUT THAT DISNEY NARRATIVE . >>I AGREE WITH THIS. THIS IS THE iPHONE EVENT. APPLE SELLS IPHONES. THEY WANT ALL OF THESE THINGS TO BE TRUE. THEY WANT US TO BE EXCITED TO HEAR THAT MULTIPLE. THEY SELL IPHONES. THIS IS THE MOST IMPORTANT PRODUCT. THIS IS WHERE THEIR PRODUCT AND PROFIT COMES FROM. UNTIL THEY CAN GRADUATE FROM THE NARRATIVE, IF THEY EVER DO. >>THE REAL JUMPING INTO THE NEXT WORLD WOULD BE TO HAVE AN ECOSYSTEM THAT WORKS ON ANDROID FOR INSTANCE. WHEN THAT BE SOMETHING? >>WOW! >>THEY ARE RIGHT ACROSS THE STREET, THOSE PEOPLE. LET’S MAKE A DEAL. >>NOW WITH THIS CURRENT ADMINISTRATION. FOR MORE ON THE STOCK MARKET ACTION, LET’S GO TO SCOTT GAMM WHO’S ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. WE HAVE NEWS THAT THE EPA’S MONEY TO ROLL BACK SOME REGULATIONS ON METHANE. WHAT IS THE STORY THERE? >>THAT RIGHT IT’S AN INTERESTING DYNAMIC. SOME ARE AGAINST THE REGULATION BECAUSE THEY SAY OIL COMPANIES ARE ALREADY TAKING STEPS TO CURB METHANE EMISSIONS. THE REGULATION IS NOT NEEDED. OTHERS LIKE EXXON, ACCORDING TO MEDIA REPORTS FAVOR SOME OF THE RULES THAT ARE ALREADY IN PLACE. WE WILL SEE HOW THE DYNAMIC UNFOLDS. TODAY, IT IS HARD TO SEPARATE THIS STORY FROM THE BROADER REACTION THAT WE ARE SEEING IN THE ENERGY SECTOR. IT IS AN UPMARKET DAY. WE TEND TO SEE ALMOST ALL ASPECT CLASSES RIGHTS, INCLUDING OIL AND ENERGY. OIL ENERGY IS UP TODAY. THIS IS THE THIRD BEST- PERFORMING SECTOR IN THE S&P 500. THE TWO ENERGY INDUSTRIES IN THE DOW ARE IN THE GREEN TODAY AS WELL. THE OTHER BIG STORY, ONCE AGAIN WAS A BOND YIELDS, WHICH ROSE ACROSS THE BOARD, LARGELY BECAUSE THERE WAS A BIT OF DEMAND ON THE SEVEN YEAR TREASURY AUCTION. THAT DID HELP TO YIELD RAISE ON THE SEVEN YEAR BOND YIELDS. THEY WENT BACK 2%. IT HAS FALLEN BELOW THAT THRESHOLD. THE YIELD CURVE IS STILL INVERTED WHEN YOU COMPARE THE TWO YEAR YIELD ON THE 10 YEAR YIELD. THE INVERSION IS LESS APPARENT. YOU HAVE TO SQUINT YOUR EYES AGAIN. THE 10 YEAR TREASURY YIELD IS BACK ABOVE 1.5%. THAT HAS BEEN AN IMPORTANT, PSYCHOLOGICAL LEVEL FOR THE 10 YEAR YIELD. >>ALL RIGHT, SCOTT GAMM LIVE ON THE NEW YORK STOCK EXCHANGE FLOOR. >>IT’S ALL ABOUT FOREVER 21. THEY ARE AWAITING A BANKRUPTCY FILING. THAT EFFORTS TO RESTRUCTURE THE COMPANY’S SUBSTANTIAL DEBT HAVE FAILED. FOREVER 21 STORES PEPPER THROUGHOUT MALLS ACROSS AMERICA. THEY HAVE STRUGGLED IN RECENT YEARS TO ATTRACT CONSUMERS. WHAT IS THE FUTURE HERE FOR FOREVER 21? >>THEY ARE TEMPORARILY 21. [ LAUGHTER ]>>FORGET ABOUT IT 21. >>FORGET ABOUT IT. THE WRITING ON THE WALLS CLEAR. I WORKED A PIECE ABOUT THIS A COUPLE MINUTES AGO ON LAUNCH. THEY HAVE FAILED TO EVOLVE. THEY’VE NOT PUT OUT THE RIGHT FASHIONS. FOREVER 21 IS ON EVOLVE. ALSO, COST RUN THE BUSINESS ARE GOING UP SIGNIFICANTLY. THE VERY BUSINESS MODEL OF FASHION IS ABOUT LOW COST AND LOW PRICES. THAT IS TIME. EVEN EXCLUDING TEARS IN CHINA, COSTS ARE GOING UP SIGNIFICANTLY. TARGET AND WALMART ARE DOING BETTER JOBS AND APPAREL. FOREVER, FOREVER 21 WAS CREATED BECAUSE DISCOUNTERS STUCK IN APPAREL. NO LONGER. TO MAKE THIS IS A PRIVATELY HELD COMPANY. WHAT A PUBLICLY TRADED COMPANIES THAT WOULD BE IMPACTED IF FOREVER 21 GOES UNDER? >>ALL OF THE PLAYERS IN THE MALL. ABERCROMBIE AND FITCH, HOLLISTER’S. LASTLY YOU WANT TO SEE IS LIQUIDATION SALES AT HUNDREDS OF THESE FOREVER 21 STORES. >>THIS REMINDS ME OF A STORY THAT WE HAVEN’T TALKED ABOUT MUCH, IT WAS A HOT ONE BACK IN 2016. I REMEMBER WHEN I FIRST GOT TO YAHOO FINANCE, THIS IS A BIG STORY, IT WAS THE MALL OPERATORS. WHAT HE DO WITH THE REAL ESTATE IN THE MALL. WHAT HAPPENS ON THE GUYS IN LONG-TERM LEASES WITH EMPTY STORES? WE KNOW THEY ARE OUT THERE, WE HAVE NOT HEARD A LOT OF STRESS. >>WE HAD A LOT OF STORE CLOSURES ALREADY. MANY STORES HAVE BEEN PRINTED. THERE ARE THOUSANDS. WE ARE WAY OVER STORED IN AMERICA. THE WEEK MALL TRAFFIC THAT WAS JUST RELEGATED TO OTHER MALLS ARE SPRINGING TO A MALLS. NORDSTROM HAS BIG WEAKNESSES. >>I THINK DEBBIE YELLED AT LIKE 9%. >>YOUR BUDDY COMES ON HERE SAYING I LOVE REAL ESTATE. IT’S LIKE YOU KNOW WHAT’S IN THAT STUFF? I DO WANT TO NAME SPECIFIC MALLS. THERE ARE PLENTY OF MALLS IN NEW JERSEY AND LONG ISLAND THAT HAVE NOT VERY GOOD STORES, THAT WILL PROBABLY GO OUT OF BUSINESS SOON. THOSE ARE LONG-TERM LEASES. THERE IS A LOT OF LAND. WHAT HAPPENS TO THE PHYSICAL SPACE? >>THEY GET BULLDOZED AND YOU BUILD CONDOS. THAT IS THE FUTURE OF MANY OF THE MALLS. >>WEARERS DEAL WE ARE STILL OER RETAILED. >>YOU ARE BEGGING THE QUESTION. WE KNOW THE ANSWER THAT. COMING UP ON “THE FINAL ROUND”, WALL STREET GOES CRAZY OF THE IMPOSSIBLE WHOPPER. WE ARE LOOKING AT CHANNEL CHECKS NEXT IN THE ANNALS RUMBLE. LET’S LOOK AT WHERE THE EUROPEAN MARKETS CLOSED ON THIS TUESDAY, IT IS THURSDAY. I MEANT THURSDAY. >>>IT IS NINE, TIME FOR THE ANALYST RUMBLE. IT IS TIME FOR THE ROAD AHEAD THAT KATE SPADE BRAND SITTING IN TAPESTRY, THEY PUT A $22 PRICE TARGET HERE. YOU CAN SEE TAPESTRY TRADES AT $20 RIGHT NOW. THERE ADDING THAT PRODUCT AND MARKETING NEED TO BE REFINED ACROSS THE OUTLET CHANNELS AS AC OUTLET TRAFFIC DEMAND WANING. THE DOWNGRADE COMES TWO WEEKS AFTER THEY HAD QUARTERLY REVENUES AT MISSED ESTIMATES. THEY DO NOTE IN HERE, SOMETHING I MISS FROM THE KATE SPADE BRAND, THE NOVELTY EXECUTION. THIS IS ONE OF THE FEW ANALYST REPORTS WERE SEEN THE WORD WHIMSICAL. IT IS NOT HITTING ON WEATHER CORE USED TO BE. >>CAN I EJECT A SAD AND OBVIOUS NOTE? THEY ARE MISSING THE INFLUENCE OF THEIR NAMESAKE THAT REPORTEDLY COMMITTED SUICIDE 15 MONTHS AGO. THIS IS A SAD THING. IT IS SO HARD TO KEEP UP WITH TRENDS. THIS IS BRIAN’S WORLD, AND MAYBE JENS WORLD. TRYING TO APPEAL TO THE FICKLE, CHANGING TASTES. THIS IS SO COMPETITIVE. >>EVEN THOUGH KATE SPADE MOVED ON WAS DOING ANOTHER BRAND, SHE IS STILL THE NAME AND THE TRAGEDY IS THERE. ONE THING I WAS SURPRISED WITH HERE, THEY HAVE MORE OUTLET STORES THAN FULL PRICE STORES. THEY HAVE 120 C LA STORES VERSUS 95 FULL PRICE STORES. ARE THEY SUPPOSED TO TAKE STUFF FROM THE FULL PRICE STORE? >>VERY MUCH. THEY USED TO. WE ARE HEARING MANY RETAILERS CALLING THIS OUT, BECAUSE TOURIST TRAFFIC, ESPECIALLY TOWARD CHINESE TOURISTS VISIT THE OUTLETS. THEY ARE NOT VISITING LIKE THEY WERE A FEW YEARS AGO. THAT IS IMPACTING MANY COMPASS COMPANIES LIKE TAPESTRY. >>I THINK ABOUT MY OWN LIFE AND WHAT WAS THE MOST EXCITING THING TO DO RIGHT BEFORE ONLINE SHOPPING WAS MAINSTREAM, AND IT WAS OUTLETS. OUTLETS WHERE EVERY TREND ALL IN ONE. IT IS DOWNSCALE ON UPSCALE NAMES. IT IS OVERBUILDING OF COMMERCIAL REAL ESTATE. IT HAS BLOWN UP. J.CREW WENT OUT OF BUSINESS BECAUSE OF THE OUTLET BUSINESS. HE MADE THE OUTLET BUSINESS SO ATTRACTIVE, NOW NO ONE WANTS TO GO TO AN ACTUAL J.CREW STORE. >>T.J. MAXX HAS ROLLED IT UP AND ONE SHINY PLACE WHERE YOU CAN GET IT ALL. IT IS A WEIRD PIECE OF THAT WORLD. >>THE THING IS, T.J. MAXX, THEY ARE NOT IN APPAREL COMPANY. YOU GO THROUGH THE CLASSIC OUTLET, J.CREW, BANANA REPUBLIC, AND THESE ARE NAMES YOU DON’T WANT TO BE IN. >>I TALKED WITH THEM AFTER EARNINGS. IT WILL TAKE TIME TO TURN THE KATE SPADE BUSINESS AROUND. I WOULD NOT EXPECT US FOR AT LEAST SIX MONTHS. >>ANOTHER NOTE, THIS TIME ON RESTAURANT BRANDS, THE PARENT COMPANY OF BURGER KING. THEY PROVIDED A CHECK ON THE COMPANY AFTER BURGER KING’S LAUNCH OF THE HOTLY ANTICIPATED, IMPOSSIBLE WHOPPER. GUESS WHAT? THEY SAY PROVIDED A BUM COUNT, ADDING THE HOME OF THE WHOPPER IS ON TRACK TO HIT A SALES ESTIMATE OF 6% GAINS FOR THE UPCOMING QUARTER. THEY HAVE BEEN OUT THERE. THEY DID THEIR CHECK, AND THEY ARE PRETTY CONFIDENT. >>THEY DID NOT MENTION POPEYE’S. WITH RESPECT TO THE IMPOSSIBLE BURGER, WE HAVE BEEN TALKING TO MANY FOLKS IN POPEYE’S. WHAT THEY DID WITH THE CHICKEN SANDWICHES THROUGH THE ROOF. SALES ARE REAL. THAT IS WHY THE STOCK WILL GO HIGHER. >>WHAT EVERYONE HAS TO LIKE, NOT ONLY DO YOU SEE IMPOSSIBLE WHOPPER SALES GOING UP, BUT IT LEADS TO THE SALES OF REGULAR WHOPPERS INCREASING. YOUR CUSTOMERS ARE MORE AFFLUENT. IT’S A HOME RUN. >>I DID SOME NUMBERS ON VEGETARIANISM. 3.4% OF AMERICANS SELF IDENTIFY AS VEGETARIANS. THAT IS 9.4 MILLION PEOPLE. THAT IS THE HUGE SET. IF YOU GET 10% OF THAT COMING YOUR WAY, HOW ABOUT THAT? THEY BRING OTHER FAMILY MEMBERS WITH THEM. IT IS A PRETTY COOL THING TO TAP INTO THAT. >>IS CRAZY THAT IS THE PERCENTAGE. I DID PICK UP THAT PART ABOUT, IT IS SKEWING THAT WAY. I WONDER IF THAT IS HOW THE SEPAL SKU AS WELL. IT IS SKEWING MORE YOUNGER AND MORE AFFLUENT. >>IT’S ALL ABOUT GETTING THE PHOTOS ON INSTAGRAM. >>THESE FOLKS ARE YOUNGER AND RICHER. >>JUST LIKE WE SAW WITH McDONALD’S WHEN THEY MAKE MENU CHANGES, THE IMPOSSIBLE WHOPPER IS NOT CAUSING SERVICE LETDOWNS. UNLIKE ITS COUSIN POPEYE’S, WHICH HAD TO TAKE IT OFF THE MENU. >>THAT LONG LINES. >>THEY DID NOT GET SUPPLY UP WHERE THEY WANTED IT. WE ARE WORKING THE PHONES RIGHT NOW. WE MAKE IT BACK ON THE PHONE BRIAN SOZZI. HAVE A GREAT EVENING. >>>CHRIS METZLER WILL JOIN US TO GIVE US HIS. FOR THE LONG-TERM FOR ANY MARKET ENVIRONMENT. WE TALK ABOUT THOSE AT THE BREAK. LET’S TALK ABOUT HOW SOME TELECOM NAMES ARE TRADING TODAY.>>>SMALL CAPS ARE MORE INSULATED FROM A TRADE WAR, OR THAT’S WHAT WE THOUGHT. WHY HAVEN’T THEY BEEN LEADING THE MARKET HIGHER? LET’S BRING IN CHRIS AND TALK ABOUT IT. WE HAVE HAD MANY PEOPLE ON. WE SAY IT HAS ALMOST BECOME SHORTHAND. THE RUSSELL SHOULD BE DOING WELL IN THE TRADE WAR. WHY IS THAT NOT HAPPENING? >>THERE ARE A FEW ITEMS HERE. SMALL CAPS HAVE BECOME MORE GLOBAL IN WHERE THEY ARE SELLING THEIR PRODUCTS. MANY TECHNOLOGY COMPANIES ARE SELLING TO CHINA LIKE HUAWEI. THERE HAS BEEN A COMPRESSION. THINK OF THIS LIKE AN ACCORDION COMING TOGETHER. WE DO THINK IT IS AN OPPORTUNITY LOOKING AT 2020. WE ARE NOT BEAR ON THE SITUATION. WE THINK WE GET TO A POINT WHERE IT IS MORE ATTRACTIVE. THEY HAVE UNDERPERFORMED. SEASONALLY, WE ARE COMING OUT OF THE END OF THE SUMMER. THIS IS TYPICALLY A TOUGH YEAR FOR THAT ASSET CLASS. ONE THING THAT IS ENCOURAGING IS THE HIGH-YIELD MARKET. IT IS HOLDING IN. IT IS AN ASSET CLASS THAT IS CLOSE IN PROXIMITY TO THE MACRO INVESTORS THAT WOULD LOOK AT DIFFERENT ASSET CLASSES. WE WOULD THINK OF THIS AS THE HIGH-YIELD AN OPPORTUNITY AS LAST BECAUSE IT HAS BEEN HARVESTED AT THIS POINT. THE NEXT GROUP IS SMALL. WE ARE EXCITED RIGHT NOW. >>THINK ABOUT WHERE THIS FITS INTO THIS DYNAMIC ENVIRONMENT. WE HAVE SEEN THE 10 YEAR TREASURY YIELD COME DOWN 100 BASIS POINTS IN A QUARTER. IT WAS A BIT MORE THAN THAT. HOW HAS THAT CHANGED THE WAY THE MARKET HAS VIEWED SMALL CAPS OVER THE LAST SEVERAL MONTHS? HOW DO YOU THINK THAT WILL CHANGE WHERE IT FITS INTO SOMEONE’S PORTFOLIO GOING FORWARD? >>WHAT THE YIELD CURVE TELLS YOU, OR CAUSES INVESTORS TO BE IS MORE NERVOUS. YOU MOVE AWAY FROM THE HIGHER RISK ASSET, WHICH IS SMALL CAPS. THAT IS THE WALL OF WORRY. WE BELIEVE THIS IS THE OPPORTUNITY THAT’S BEING CREATED AS THEY CLOSE THE GAP WITH LARGE COMPANIES. YOU MIGHT SEE THEY WILL DO LESS OUT OF EUROPE. THE LONG END OF THE CURVE GOES UP. NOW IT IS NOT INVERTED. IT IS TELLING YOU, A LOT OF THE GLOBAL INTEREST RATES ARE PROBABLY COMPRESSING OUR RATE CURVE. IT’S THE INVERSION TELLING YOU THERE IS A RECESSION. WE DO NOT SEE IT. WE THINK IT IS MORE OF A TECHNICAL ISSUE FOR A PERIOD OF TIME. ON A DAY LIKE TODAY, YOU CAN SEE THAT REVERSED. >>SOME PEOPLE SAY SMALL COMPANIES ARE PERMANENTLY DISADVANTAGED IN THIS ECONOMY, BECAUSE YOU NEED TO SPEND SO MUCH TIME ON I.T. IS THAT THE CASE? >>IT DOES DEPEND ON THE COMPANY. IF YOU HAVE A STRONG TECHNOLOGICAL NOTE AND YOU CAN DEFEND YOURSELF ON A GLOBAL BASIS, YOU SHOULD BE ABLE TO PROTECT YOUR MARGINS. WHAT THE COMPANIES REALLY NEED TO SEE IS NOT A DECELERATION OF GLOBAL ECONOMIC ACTIVITY, BUT A RE-ACCELERATION. WE THINK, AGAIN, TO MY ANALOGY OF THE COMPRESSION OF AN ACCORDION, WE THINK WE ARE SETTING THAT UP FOR 2020. WE TALKED TO COMPANIES, AND THAT IS WHERE THEY ARE DIRECTING US TO. WE TALKED TO SEMI EQUIPMENT COMPANIES. THERE ARE TECHNOLOGICAL NODES AND INNOVATIONS COMING. THEY ARE THINKING MORE 2020. >>THEY CAN JUST MAKE IT BE OVER. >>YOU SAID YOU FOUND OPPORTUNITIES IN MARCH AND APRIL. YOU DO SOUND OPTIMISTIC RIGHT NOW ABOUT DEPLOYING SOME CASH IF YOU ARE THE INVESTOR THAT HAS THE ABILITY AND TIME TO DO THAT, WHERE DO YOU LOOK IN SMALL CAPS SECTOR. >>IF YOU ARE NOT TRADING FOR THE NEXT WEEK OR THE NEXT QUARTER, ONE AREA IS SEMI-CAPS EQUIPMENT. ONE OF THEM WAS PHOTONICS. IT WAS BEGINNING TO FINISH THEIR INVESTMENT IN CHINA. IT WAS GOING TO BE TRANSFORMING THE CASH FLOW PROFILE. THEY JUST ANNOUNCED $100 MILLION BUYBACK PROGRAM THIS WEEK. THE STOCK HAD A CONSIDERABLE MOVE IN THE LAST 48 HOURS. GIVE IT SOME TIME. THAT WAS ONE OF THE BIG PICKS GOING INTO THE EARLY PART OF SUMMER. >>YOU SAID THEY WERE CHINA. WHEN PEOPLE SAYING, I WANT TO GET INTO SMALL CAPS AS I DON’T HAVE ANYTHING. >>WHAT DOES THIS TEACH THE CHINESE? THEY HAVE TO BUILD A DOMESTIC SEMI CONDUCTOR INDUSTRY OF THEIR OWN. P LAB IS INVESTING IN THE SUPPLY CHAIN TO PROVIDE COMPONENTS CALLED PHOTO MASKS, THAT HELPED TO BUILD THE SEMI CONDUCTORS ON DOMESTIC MAINLAND CHINA. THAT INVESTMENT IS OVER. THE CUSTOMERS ARE IN PLACE. THERE ARE AGREEMENTS FOR SOME GUARANTEED SALES THAT THEY HAVE MADE. THEY ARE A GLOBAL PLAYER FOR ALL FOUNDRIES AND MEMORY PLAYERS WITH FLAT-PANEL DISPLAYS. ALSO, THE GROWTH OF THE 10.5 GENERATION, THAT PANEL DISPLAY, BEING DEALT OUT. THAT IS THEIR OPPORTUNITY. AGAIN, IT HAS BEEN DONE VERY WELL. GIVE IT SOME TIME. WE DO THINK THE LONG-TERM PROFILE OVER THE NEXT 2 YEARS IS PRETTY GOOD. >>IS GREAT TO SEE YOU CHRIS. THANK YOU. >>>WE HAVE MORE ON “THE FINAL ROUND”. BETA WORKS FOUNDER AND CEO , ON WHY HE IS LEERY OF AMAZON AND GOOGLE. WILL TAKE A PREVIEW OF THIS WEEK’S ISSUE OF INFLUENERS. LET’S SEE HOW THE NAMES ARE TRADING IN TODAY’S MARKET.>>>HELLO EVERYONE, WE ARE HERE IN NEW YORK, AND THIS IS “THE FINAL ROUND” ON YAHOO FINANCE. PAGING COOLS OFF ON THE TRADE RHETORIC. WE HAVE MORE ON ALL OF TODAY’S MARKET ACTION COMING UP IN A BIT. WELLS FARGO’S TOP FIXED INCOME STRATEGIST WILL TELL US WHAT IS NEXT FOR BONDS, AND WHETHER NEGATIVE YIELDS COULD BE COMING TO AMERICA. SHARES ARE CHATTERING AS JUUL IS TAKING SOME DROPS. WE WILL GRADE THE WEEK. THIS WAS DONALD TRUMP, AND WE WILL LOOK AT THE TRUMP SCORE OF NEXT. THIS IS MY COHOST, JEN ROGERS AND ANDY SERWER. DO YOU FEEL LEFT OUT? >>I WANT TO CALL IT A TRY 27. HE SAYS IT IS A TRUMPMOMETER. THAT BATTLE IS BEEN FOUGHT AND LOST. WAS HE WITH THE MAJORS ARE NOW. ALL THREE ARE IN THE GREEN. IT WAS THE SECOND STRAIGHT POSITIVE DAY IN A ROW. WE HAVE ONE MORE DAY LEFT IN THE MONTH OF AUGUST. AS WE GET TOWARD THE END OF THIS MONTH, WE CAN LOOK BACK AND START TO SEE THE STORIES THAT HAVE COME OUT OF WHAT HAS BEEN AN EVENTFUL AUGUST. WE WOULD BE REMISS IF WE DID NOT MENTION WHAT HAPPENED IN THE BOND MARKET. DEVELOPMENT ARE HAPPENING THERE. STEPHEN MINH NGUYEN, THE SECRETARY, SAYS, ULTRA LONG BONDS ARE BEING CONSIDERED BY THE ADMINISTRATION. THAT COULD BE 50 OR 100 YEAR BONDS. THIS IS ACCORDING TO LINDBERGH NEWS. ANDY SERWER, YOU HAVE PICKED A BONE WITH THEM OF LATE. >>I HAVE. >>OF COURSE, YOU CAN LENGTHEN THE CURVE, AND IT DOESN’T MATTER THAT MUCH. YOU COULD SAY SURE, DO IT, WHY NOT? SOME SAY, THE RATES ARE SO LOW, YOU HAVE TO DO IT NOW. WHAT YOU THINK OF THE IDEA OF A CENTURY BOND? >>I LOVE TO TALK ABOUT A CENTURY BOND. I KNOW OF AN INSTITUTION THAT ISSUED A CENTURY BOND. THEY DID IT TOO EARLY. YOU HAVE THAT PROBLEM. THE AUSTRIAN GOVERNMENT DID ONE RECENTLY. I THINK MEXICO, WALT DISNEY, AND COCA-COLA HAVE DONE THEM IN THE PAST. IT’S NOT CRAZY. AGAIN, TO ME, THIS IS ANOTHER ONE OF THESE, MINDBENDING THINGS IN THE BOND MARKET. WHAT FORCES YOU TO DO IS CONSIDER THE WORLD IN THE YEAR 2120. >>ELON MUSK A SAYS THE COMPUTER WILL TAKE OVER BY THEN. WHO KNOWS? >>IT WON’T EVEN BE YOUR KIDS. I’M SORRY TO SAY THAT, YOUR CHILDREN WILL NOT BE ALIVE THEN. THIS IS 2121. THIS IS 2121. THEY WILL BE ALIVE IN 2021. THIS IS 2120, WHEN THE BONDS ARE DUE, YOU WILL NOT KNOW ANYONE. YOU WILL KNOW NO ONE. THERE WILL BE FLYING CARS AND ROBOTS. THAT IS DEPRESSING. >>I HOPE THIS SEGMENT STILL EXISTS ON THE INTERNET. I HOPE THAT YAHOO DOES NOT EXPIRE THIS PACKAGE IN 100 YEARS, SO WE CAN GO BACK AND SAY, LOOK AT WHAT PEOPLES HAIRCUTS WERE LIKE. LOOK AT THOSE IDIOTS IN 2019. >>EVERYTHING IS ALWAYS SAVED ON THE WEB. THAT IS NOT TRUE. THIS WILL NOT EXIST. IT WILL GET A RAISED AND FORGOTTEN. >>HAVE YOU SEEN THE JETSONS LATELY? IT IS A LOT LIKE THAT. >>I HAVE NOTHING OPPOSED TO THIS. I DON’T THINK IT’S BAD THAT THE GOVERNMENT IS LOOKING INTO IT. I DON’T THINK THE DEMAND IS THERE. >>WE ARE LOOKING AT ALL OF THE BEST THINGS. WHAT CONCERNS ME MORE IS LIKE STUFF ON THE TITANIC. WE DON’T GET TO TALK ABOUT THE FUNDAMENTALS OF THE ECONOMY. HOW MUCH THE GDP WAS? IT’S ALL ABOUT, WE ARE GOING TO SUCH EXTREMES. WE HAVE 100 BASIS POINTS. THIS IS A 100 YEAR BOND. LET’S PLAY IN THE FRAMEWORK WE HAVE, AND SEE WHERE IT GOES. >>THAT IS OLD-FASHIONED FINANCIAL TALK. >>LET’S JUST ENJOY OBAMA’S ECONOMY. WHY GET CRAZY? WE ARE DOING OKAY. WE WON’T BE HERE IN 2121. >>I DON’T WANT TO BE. WHO WOULD WANT THAT? >>80 IS A GREAT NUMBER. >>OXFORD UNIVERSITY DID ONE. >>THEY BEEN AROUND 400 YEARS, THEY WILL PROBABLY MAKE IT ANOTHER HUNDRED. YOU HAVE TO HAVE THAT KIND OF PERSPECTIVE. >>WE HAVE BEEN AROUND ABOUT 250 YEARS OLD, WE CAN’T DO A 100 YEAR BOND. FOR MORE ON TODAY’S MARKET ACTION, LET’S GO TO SCOTT GAMM ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. SCOTT, WHEN YOU HAVE YOUR EYE ON RIGHT NOW, HEADING INTO CLOSING? IT IS PRETTY MUCH A RALLY. THE MARKET HAS ABSORBED A TON. IT SEEMS TO BE GOING HIGHER AT THE END OF THE MONTH. >>THAT’S RIGHT, WE ARE RALLYING AS WE AND THE WILD MONTH OF TRADING IN AUGUST. I MUST SAY, THE S&P 500 HAS BEEN IN A RATHER NARROW TRADING RANGE FOR A GOOD PART OF AUGUST. IT’S HARD TO BELIEVE, BUT THE RANGE HAS BEEN 2822 2950. HERE WE ARE WITH THE S&P 500, AT THE HIGHER END OF THE RANGE AT 2923. IT IS STRIKING TO ME THAT YOU HAVE A LOT OF CHARACTERISTICS OF A RISK ON ENVIRONMENT. ASIDE FROM THE BROADER RALLY IN STOCKS, WHEN YOU LOOK UNDER THE HOOD, ESPECIALLY IN THE DOW JONES INDUSTRIAL AVERAGE, THE LAGGARDS ARE THE RECESSION PROOF STOCKS. WERE TALKING NAMES LIKE JJ, PROCTER & GAMBLE, COCA-COLA, AND VERIZON. THE NAMES ARE DOWN SLIGHTLY. THEY ARE STILL IN THE RED. YOU HAVE GOLD PRICES, FINALLY LOWERING THEIR GAINS OVER 1%. WE HAVE HAD SEVERAL BIG OF DAYS THROUGH THE MONTH OF AUGUST. DURING THOSE DAYS, YOU HAVE GOLD PRICES RISE. WE HAVE AN INVERSE RELATIONSHIP BETWEEN STOCKS AND GOLD, BACK IN PLAY. THAT IS A SIGNAL OF A RISK ON ENVIRONMENT. AS WE HAVE TALKED ABOUT THE RECOVERY IN BOND YIELDS. THAT DOES BRING ME TO AN IMPORTANT CALL FROM CHIEF MARKET STRATEGIST TONY DWYER, SPEAKING OF THE INVERTED YIELD CURVE. HE SAYS IT IS NOT DIFFERENT THIS TIME. WE SHOULD TAKE THIS SERIOUSLY. THERE IS A TWO-YEAR LAG TIME FROM THE INITIAL INVERSION OF THE 2 AND 10 FROM WHEN THE RECESSION STARTS. THE STOCKS WILL RALLY. YOU GO BACK TO DECEMBER 2005, WE HAD THE INITIAL INVERSIONS OF THE 2 AND 10. THE RECESSION STARTED 2 YEARS LATER IN DECEMBER 2007. STOCKS DID PEAK TWO MONTHS EARLIER IN OCTOBER. FROM THAT TIME FROM DECEMBER 2005 THROUGH DECEMBER 2007, IT RALLY 27 TIMES. THERE IS ROOM FOR GROWTH IN STOCKS ACCORDING TO DWYER. IS 2020 TARGET ON THE S&P 500 IS 3350. ABBOTT ECLIPSE THE RECORD HIGH FROM LATE JULY. >>SCOTT GAMM, WE WILL TALK WITH YOU AFTER THE BELL. >>>WITHOUT GIVING A PREVIEW OF THE LATEST EPISODE OF THE WEEKLY SHOW, INFLUENCERS, WITH ANDY SERWER. YOU SAT DOWN WITH THE CEO AND FOUNDER OF THE FIRM BETA WORKS, BETTER KNOWN TO FOLKS IN NEW YORK, THEN ON THE WEST COAST. WAS A CONVERSATION LIKE? >>BETA WORKS IS VERY INFLUENTIAL HILLER — HERE IN NEW YORK CITY. JOHN’S HAD HIS HANDS IN THE IMPORTANT STARTUPS HERE. HE IS A VERY THOUGHTFUL PERSON WHEN IT COMES TO SPEAKING ABOUT ISSUES REGARDING TECHNOLOGY AND TECHNOLOGY COMPANIES. HE KNOWS THE INDIVIDUALS PRETTY WELL. I SPOKE WITH HIM A BIT ABOUT SOME OF THE NEWEST TECHNOLOGIES IN TERMS OF SMART SPEAKERS. HERE’S WHAT HE HAD TO SAY ABOUT THAT. >>THE SMART SPEAKERS ARE AN INCREDIBLE INVASION. THEY REPRESENT ON MY TEAM WE TALK ABOUT THIS, WE THINK THIS IS A NEW INTERFACE. YOU GO INTO THE KITCHEN AND YOU CAN TALK TO THIS DEVICE AND IT GIVES YOU INFORMATION. SMART SPEAKERS AND SMART HEADPHONES, THEY ARE IN THE SAME CATEGORY. I CAN SPEAK TO THEM. THAT IS KIND OF COOL, RIGHT? I WOULD SAY, THERE ARE TWO OR THREE LAYERS OF PROBLEMATIC LAYERS WITH THE NEW SMART SPEAKERS AND SMART EARPHONES THAT ARE IN MARKET NOW. THE FIRST IS FROM A CONSUMER STANDPOINT AND A USER STANDPOINT. THE DEVICES ARE BEING USED FOR SURVEILLANCE. IT’S HARD TO CALL IT ANYTHING ELSE. THERE HAVE BEEN INSTANCES, THERE WAS A SMART TV THAT WAS LISTENING IN TO A BUNCH OF PEOPLE. AMERICAN CONSUMERS PURCHASE A SMART TV, THEY WERE LISTENING TO THE ACTIVITY GOING ON IN THE ROOM AND USING THAT TO TARGET ADS. THEY’RE USING THAT FOR DATA TO PERSONALIZED YOUR EXPERIENCES. THAT DOESN’T SEEM OKAY. >>THE FACT THAT THIS STUFF IS 1000% UNREGULATED, IT’S AMAZING. THE TECHNOLOGY COMPANIES, THE GOOGLE, AMAZON, AND FACEBOOK, INTRODUCE PRODUCTS THAT, INTRUDE, AND HELP IN OUR LIVES IN A MYRIAD OF WAYS WITHOUT ANY OVERSIGHT BY THE FEDERAL GOVERNMENT. SOMETIMES, THREE MONTHS IN, OH YEAH, WE ARE LISTENING TO YOUR KIDS, WE PUT IN A DATABASE, AND I GOT SENT TO JAKARTA, SORRY ABOUT THAT. IT IS STRIKING. WE HAVE THE INDUSTRIAL REVOLUTION, THE GOVERNMENT CATCHES UP, THE GILDED AGE, THE GOVERNMENT CATCHES UP. GIANT CORPORATIONS, THE SAME THING WILL HAPPEN HERE. >>FOR THE FULL CONVERSATION, CHECK OUT THE LATEST EDITION OF INFLUENCERS TONIGHT AT 5:00 P.M. EASTERN RIGHT HERE ON YAHOO FINANCE , AND THE YAHOO FINANCE MOBILE APPS. >>>WELLS FARGO’S TOP STRATEGIST ON WHAT IS NEXT FOR BONDS AND THE FED. LET’S SEE HOW BIG BANKS ARE TRADING AS WE HEAD INTO CLOSING.>>>LET’S LOOK AT TODAY’S WINNERS AND LOSERS. WE HAVE A LOT OF RETAIL NAMES. STOCKS ARE IN THE RED ARE ABERCROMBIE AND FITCH, THEY LOST $.40 PER SHARE IN THE LATEST QUARTER AGAINST PROJECTED $.53 PER SHARE. REVENUE FELL SHORT OF ESTIMATES, WHILE STORE SALES REMAINED FLAT. WILLIAMS-SONOMA REPORTED A DECLINE IN THEIR STORE SALES FOR THE SECOND QUARTER. DESPITE AN OTHERWISE STRONG EARNINGS REPORT, AND POSITIVE FULL-YEAR GUIDANCE. ANOTHER ONE IN THE RED IS BEST BUY. THEY DROPPED, DESPITE THE EARNING SPEEDING REVENUE AND COMPARABLE STORE SALES FELL BELOW PROJECTIONS. SOME STOCKS TAKEN PART IN THE RALLY, ELASTIC, THE SOFTWARE COMPANY RAISE THEIR FINANCIAL PROJECTIONS FOR THE YEAR, FOLLOWING BETTER THAN EXPECTED RESULTS. BURLINGTON STORES, AFTER THE RETAILER RAISED THE FOR YOUR GUIDANCE, AND MEET THE REVENUE ESTIMATES FOR THE SECOND QUARTER. FINALLY, DOLLAR GENERAL SHARES ARE SPIKING TODAY AFTER THE COMPANY RAISED THE FOR YOUR OUTLOOK AND THE LOWER END OF ITS EARNINGS GUIDANCE. >>FIELDS ARE BACKING UP A BIT. THE LONG BONDS RECORD CLOTHING ASKING WHERE IT ENDS IN A WORLD FULL OF NEGATIVE YIELDS. JOINING US TO TALK ABOUT FIXED INCOME IS BRIAN REELING, YOU EXPECT THE FED WILL CUT RATES TWICE MORE THIS YEAR. I WONDER IF THE BOND MARKET ISN’T TELLING THE FED THAT THEY MAY NEED TO BE MORE AGGRESSIVE THAN THAT. >>THE BOND MARKET IS TELLING THE FED IT SHOULD BE MORE AGGRESSIVE. THAT IS EVIDENCED BY THE EXTREME INVERSION THAT WE SEE IN THE YIELD CURVE. THE FED LOOKS LIKE THEY WILL WAIT FOR THE DATA TO ROLLOVER BEFORE THEY GET MORE AGGRESSIVE.>>WE SPOKE TO A BRAND-NAME WALL STREET STRATEGIST. I WILL NOT NAME HIM. I ASKED HIM HOW TO PLAY THE CHINA TRADE. HE SAYS YET BE SAFE. YOU HAVE TO GO TO THE SAFETY OF BONDS. THAT IS A SAFE HAVEN. DO BONDS FEEL LIKE A SAFE HAVEN TO YOU RIGHT NOW? >>YES, BONDS MAINTAIN THEIR SAFE HAVEN STATUS IN TIMES OF STRESS. IF WE JUST MUDDLE ALONG, YOU WILL DO BETTER IN THE HIGHER- YIELDING EQUITIES OR FIXED INCOME. IN TIMES OF TRUE RISK, THERE IS NO BETTER SECURITY THAN THE U.S. TREASURY. >>ONE OF THE YIELDS? DO YOU THINK WILL SEE GOOD YIELDS? >>T IS NOT OUR EXPECTATION, BUT IT IS DEFINITELY POSSIBLE, IF THE RECESSION, WHEN AND IF IT OCCURS, IT IS A MATTER OF WHEN, IF IT IS DEEPER SUSTAINED, THERE’S NO REASON WE CANNOT FOLLOW THE OTHER DEVELOPED COUNTRIES AROUND THE WORLD INTO NEGATIVE TERRITORY. IT IS NOT ERIC’S ACTED POSITION RIGHT NOW. >>WHAT WOULD NEGATIVE RATES MEAN? >>THAT’S A GOOD QUESTION. YOU ALREADY FIND, ELSEWHERE IN THE WORLD, INVESTORS ARE LOOKING WHERE THEY HAVE NEGATIVE RATES FOR OTHER INCOME ALTERNATIVES. I WOULD EXPECT, ABSENT A SIGNIFICANT RISK OFF OF FEAR TRADE, IF YOU ARE AT A LOWER NEGATIVE RATE, INVESTORS WILL GRAVITATE TO THE HIGHEST YIELDING INVESTMENTS. IN THE FIXED INCOME WORLD, THAT WILL BE HIGH-YIELD. YOU WANT TO FIND QUALITY. YOU TO MAKE SURE THE COMPANIES CAN PAY YOU BACK. I WOULD EXPECT HIGHER-YIELDING EQUITIES TO DO VERY WELL IN THAT ENVIRONMENT AS WELL. >>THINKING ABOUT WHERE THE ECONOMY GOES FROM HERE. AGAIN, THE AGE-OLD ARGUMENT, THE YIELD CURVE SAYS THERE IS A RECESSION. HOW DO YOU SEE THINGS SHAKING OUT AS WE LOOK TOWARD THE SECOND HALF OF THIS YEAR AND 2020. IT SEEMS TO BE ON MORE AND MORE FOLKS RADAR. >>THE WAY WE VIEW IT IS, THE CONDITIONS ARE FAVORABLE FOR RECESSION. WE DON’T SEE A RECESSION IN THE CARDS AT THIS POINT. THERE IS MORE DOWNSIDE RISK THAN UPSIDE RISK IN THE ECONOMY. IT IS INCREASING IMPOSSIBILITY, BUT WE DO NOT SEE THAT AS IMMINENT THIS YEAR OR NEXT YEAR.>>THERE ARE SO MANY TOPICS AND BONDS. IT IS SO EXCITING. THERE IS TALK OF CENTURY BONDS WITH THE TREASURY. STEVE MINASIAN SAYS THEY ARE CONSIDERING 50 YEAR OR 100 YEAR BONDS. WHEN YOU THINK OF THAT. >>I THINK IT IS A NICE IDEA. I DON’T THINK THERE IS A TON OF DEMAND FOR THAT TYPE OF SECURITY ON A SUSTAINABLE BASIS. YOU WOULD PROBABLY JUST EAT AWAY AT YOUR 30 YEAR DEMAND. I’M NOT SURE YOU BRING YOUR BUYERS IN. I DON’T SEE THE ADVANTAGE THEY ARE FROM A TREASURY PERSPECTIVE IN ISSUING THEM, OTHER THAN IT WOULD MAKE NICE HEADLINES IN THE SHORT TERM. THE OTHER ISSUE TO THINK ABOUT, NOT THE BASE CASE, IF WE DO HAD TO LOW OR NEGATIVE RATES, A 2% CENTURY BOND MAY NOT LOOK THAT ATTRACTIVE OVER THE LONG TERM FOR THE U.S. TREASURY. >>THANK YOU BRIAN, FOR JOINING US. >>THANK YOU FOR JOINING ME. >>ANDY SERWER, WE WILL SEE YOU AT 5:00 P.M. MAKING BONDS EXCITING. >>ACTUALLY, I LOVE THE ENTHUSIASM THAT ANDY HAS ON THE BOND MARKET. IS:I’VE NEVER BEEN THIS EXCITED ABOUT FIXED INCOME. SO MAKE IT WENT FROM 0 TO 100. >>YOU ARE HOT ON BONDS. IS COMING UP WE HAVE THE CLOSING BELL ON WALL STREET. FIRST WE GET TECHNICAL WITH OUR CHARTIST FRIEND, BRIAN SHANNON, WHAT HE SEES IN ACTIVISION AND BLIZZARD SHARES. LET’S LOOK AT THE DOW WINNERS.>>>IT IS TIME TO GET TECHNICAL WITH BRIAN SHANNON. WE TALKED LAST FRIDAY. WE STARE DOWN THE BARREL OF A 700 POINT DECLINE IN THE DOW. RIGHT NOW, WE ARE UP 300 POINTS. WHAT DO YOU SEE IN THE MARKET, TECHNICALLY, FOR THE LAST SEVERAL TRADING SESSIONS. TO MY MIND, IT HAS GOTTEN SLOPPY. I DON’T KNOW WHAT THE CHARTS ARE SAYING TO YOU. >>MY FRIEND JC HAS A THING, IT IS A BIG, HOT MESS. THAT IS WHERE I SEE THE MARKET. IT IS UP AND DOWN, BACK AND FORTH WITH THE GAPS COMMENTS MAKING IT DIFFICULT TO FIND TRACTION IN EITHER DIRECTION. YOU HAVE TO BE CAREFUL NOT TO CHASE THE MARKET ITSELF IN EITHER DIRECTION. I THINK IT MAKES MORE SENSE TO PAY ATTENTION TO THE INDIVIDUAL NAMES, AND MANAGE RISK. LAST WEEK I THOUGHT WE WERE HEADING TO THAT 200 DATE MOVING AVERAGE. THEN, THAT IS OUT THE WINDOW AGAIN. IT IS DIFFICULT TO SEE THE SHORT TERM OF THIS MARKET WITH ALL THE HEADLINE RISK. :LET’S TALK ABOUT THE INDIVIDUAL NAMES STANDING AT YOU NOW.:ACTIVISION AND BLIZZARD, VIDEOGAME MAKER. I DON’T PLAY THE GAMES, BUT THEY HAD NEWS ABOUT ONE OF THEIR GAMES CALLED WORLD OF WARCRAFT. ANYWAY, THE STOCK GOT CUT IN HALF IN THE FOURTH QUARTER OF LAST YEAR. IT CAME DOWN, AND THEY MADE A NICE BASE OVER THE LAST SEVEN MONTHS OR SO. NOW, WE HAVE THIS CATALYST THIS WEEK, JUST THREE DAYS AGO. THE STOCK IS BACK ABOVE THE 50 DAY MOVING AVERAGE. I THINK MOST IMPORTANTLY, THE VOLUME WEIGHTED AVERAGE PRICE FROM THAT PEAK LAST OCTOBER, GETTING BACK ABOUT THAT REALLY PUTS THE BUYERS BACK IN CONTROL. I LIKE THE STOCK HERE. SO MAKE AS YOU LOOK TO SCALE INTO A POSITION, YOU HAVE A LONG BASE, YOU ARE BREAKING ABOVE, HAD TO THINK ABOUT SCALING INTO A POSITION LIKE THIS, WHAT KIND OF STOPS TO PUT IN ALONG THE WAY? >>AS THEY SAY, THE BIGGER THE BASE, THE HIGHER IN SPACE. THE NICE THING ABOUT THIS STOCK, IT DID GAP LOWER. IT IS RIGHT AROUND THE 62 LEVEL. IT DID GAP DOWN LAST NOVEMBER. THAT MAKES A GOOD UPWARD TARGET, INITIALLY. WHO KNOWS HOW HIGH CAN REALLY GO. THE KEY IS RISK MANAGEMENT. I SEE THIS AS, PURCHASING IT RIGHT HERE, IS $51 PER SHARE. IF YOU WANT A TIGHT STOP, YOU COULD PUT YOUR STOP BELOW AT $49.50. IF THAT IS UNCOMFORTABLE FOR YOU, THE LOWER LAST WEEK, WHICH IS BELOW THE 50 DAY MOVING AVERAGE, WOULD PUT YOUR STOP AT $47.16. YOU CAN CALL IT AN EASY $47. THAT WOULD GIVE YOU FOUR POINTS OF RISK FOR THE POTENTIAL OF SEEING THE STOCK BACK UP TO $62 PER SHARE, OR 11 POINTS. THAT IS A NICE RISK REWARD. ANOTHER WAY TO DO IT IS TO STAGGER THE STOPS. HAVE HALF OF YOUR STOP AT $49.50. THE OTHER ONE SHOULD BE AT THE $47 LEVEL. >>ALL RIGHT, THAT IS BRIAN SHANNON, THANK YOU, HAVE A GREAT HOLIDAY WEEKEND. >>YOU TOO. >>>COMING UP IT’S A CLOTHING BILL ON WALL STREET. WE HAVE YOUR TRUMPMOMETER SCORE, AND WE HAVE ONE LAST LOOK AT YOUR BIG INDUSTRIAL NAMES HEADING INTO THE BELL.>>>WELCOME BACK TO “THE FINAL ROUND” ON YAHOO FINANCE. JUST-IN-TIME, THAT IS THE CLOSING BELL ON WALL STREET. WE HAVE LIVE PICTURES. WE HAVE STOCKS HERE CLOSING HIGHER AFTER SOME CALMING TALK COMING OUT OF CHINA. ID FEEL CALM? >>IS LIKE CALM DOWN, JUST LIKE TAYLOR SWIFT, RELAX, LET’S FIGURE THIS OUT. NOW WE LOOK AT WHERE THE MARKETS DID CLOSE. WE ARE CONTINUING TO LOOK AT THIS. I DON’T KNOW? IS THIS THE DIRECTION? WE HAVE FELT LIKE WE DIDN’T HAVE A DIRECTION. DOES THIS TELL US THE WAY FORWARD? >>WE KNOW THE RANGE. WE KNOW IT IS 2942 2830. WE ARE AT THE TOP END OF THE RANGE. TOMORROW’S SESSION, IT WOULD BE WEIRD AT THE END OF THE MONTH. IT WOULD BE WEIRD TO SEE TOMORROW BE THE DAY THAT WE GET A CONFIRMED CLOSE ABOVE THE RANGE. IT IS POSSIBLE. WE ARE ONLY 16 HANDLES AWAY FROM THAT. WE ARE NOW BACK TO ONE OF THE DECISION POINTS. WE TALKED ABOUT THIS WITH JARED. EVERY TIME HE IS ON, WE BRING THIS UP, OF THE RANGE OF THE MARKET BEING ESTABLISHED IN AUGUST. IS IT THE FED? IS THERE SOMETHING ELSE WE ARE NOT KICK AT? THIS IS A DECISION POINT. NEXT WEEK WILL BE INTERESTING. >>I HAVE SEEN MANY OF THESE PANICKING SYMBOLS THAT BECOME ON PANICS. THEY HAPEN ONCE AND THE MARKET FREAKS OUT, THEN THE MARKET LIKE IT IS FINE. WITTY YIELD INVERSION, MY GOODNESS, THE RECESSION IS COMING. WE HAD THE CHINESE ALLOWING THE CURRENCY TO DEVALUE DOWN TO SEVEN, NOW IT IS LOWER THAN THAT. >>IS NO BIG DEAL, NOBODY CARES. WE HAVE THE 10 YEAR AT 1.5. THAT IS REMARKABLY LOW. WE GOT USED TO THAT REALLY FAST. NOW WE HAVE A TOTAL RECOVERY FROM THE BIG PLUNGE WE HAD LAST FRIDAY WHEN TRUMP ESCALATED THE TRADE WAR. EVERYTHING IS FINE. WE DID ABSORB A LOT. >>TO YOUR POINT, RICK, ALL THE STORIES MATTER, BUT WHY DO THEY MATTER WHEN THEY MATTER? THE PRICE OF STOCKS MOVES A LOT. IT GOES DOWN A LOT. ON THESE DAYS WHEN THE PRICE GOES UP, WE CAN EXCUSE AWAY THIS. WHEN IT GOES DOWN, SO BIG A STORY. IT IS VERY DIFFICULT TO REALLY FIGURE OUT WHAT THE MARKET WANTS, OR WHERE WE ARE HEADED. >>I SEE A LOT OF GUESSING. A LOT OF THIS IS DRIVEN ABOUT GUESSING INSTEAD OF THE FUNDAMENTALS. WHY DO WE HAVE SUCH A HUGE SELLOFF THE DAY WE HAD A TEMPORARY INVERSION IN THE YIELD CURVE? IT CAME BACK NOW, WE HAVE THE INVERSION, IT IS HERE, LOOKS LIKE IT IS HERE TO STAY FOR A FEW DAYS, MAYBE A BIT LONGER. NOBODY CARES. SOME IS LIKE THAT WAS A PLAY INTO RECESSION FEARS, THERE WOULD BE A SELLOFF AND THEY WOULD BUY BACK LOWER. I DON’T KNOW. THESE ARE LIKE PSYCHOLOGY BANK SHOTS. >>IT’S TOUGH TO FIGURE OUT THE MARKET IF YOU LOOK AT ONE DAY. WE WILL FIGURE THIS OUT IN A FEW YEARS. THE COMPANY WE HAVE BEEN LOOKING AT IS TESLA. THEY ARE OUTPACING THE MARKET WITH PRETTY GOOD GAINS TO THE UPSIDE. THE COMPANY ANNOUNCED THEY LAUNCHED AN INSURANCE PRODUCT, PROMISING HEFTY SAVINGS IN CALIFORNIA. THEY SAID THE INSURANCE IS DESIGNED TO PROVIDE TESLA VEHICLE OWNERS WITH UP TO 20% LOWER RATES, POSSIBLY 30%. THIS HAS BECOME AN ISSUE FOR TESLA. IN SOME CASES, THE INSURANCE IS HIGHER THEIR CARS. >>THEY ARE AMONG THE MOST EXPENSIVE CARS TO ENSURE BECAUSE THEY ARE HARD TO REPAIR. THEY ARE UNIQUE VEHICLES. THERE ARE NOT VERY MANY OF THEM OUT THERE. INSURANCE RATES ARE BASED ON DATA. THIS IS ACTUAL ANALYSIS, WHAT IS A DATA TELL US? THERE IS NOT ENOUGH DATA ON THEM. TESLA THINKS THEY CAN DO THIS BETTER, BECAUSE THEY DO RETRIEVE A LOT OF DATA ABOUT THEIR CARS, WHAT HAPPENS TO THEM? THEY SAY THEY COMPRISE THE POLICIES BETTER BECAUSE THEY KNOW THEY CAN SHOW THE CARS ARE SAFER, OR SOMETHING LIKE THAT. THERE MANY QUESTIONS ABOUT THIS.>>IS IT MONEYMAKING? >>IF THIS WAS A WAY TO MAKE EASY MONEY, WHY WOULDN’T ALL AUTOMAKERS DO IT?:THEY HAVE MORE DATA.>>Reporter: THAT SO THEY SAY. ON THE OTHER HAND, GISELE INSURANCE, YOU TO BE REGULATED AS AN INSURANCE COMPANY. THAT’S DIFFERENT. YOU HAVE TO HAVE THE FINANCIAL RESERVES OF AN INSURANCE COMPANY. IT TURNS OUT THAT THEY ARE NOT TELLING ANYBODY THIS, IT LOOKS AS IF THEY ARE PARTNERING WITH AN INSURANCE COMPANY, BUT SELLING IT AS A TESLA PRODUCT. IT IS AN ACTUAL INSURANCE COMPANY THAT IS LISTED WITH THE STATE OF CALIFORNIA AS THE INSURER IN THIS CASE. WHAT THAT TELLS YOU, THIS IS A PLOY TO GET UP FROM FINANCING, THE FINANCING WILL NOT GO TO TESLA. YOU GET THE PREMIUMS, YOU GET THE FLOAT. YOU DO THE PAYOUTS LATER. WE KNOW THAT TESLA NEEDS CASH. THERE IS REGULATION THAT THIS IS A FUNDING MECHANISM. IF IT’S A THIRD-PARTY INSURANCE COMPANY DOING THE INSURING, THEN TESLA WOULD NOT HAVE ACCESS TO THE MONEY. IT WOULD HAVE TO RESIDE AT THE INSURANCE COMPANY. MAYBE THEY ARE RIGHT, THEY CAN DO BETTER. I THINK IT IS A FAIR BET THAT MAY NOT BE DOING THIS IN A YEAR. >>WHO IS THE TED AND THAT OF TESLA? THAT’S WHAT I WANT TO KNOW. ESTIMATE THERE ARE NOT ANY. >>THEY’LL KEEP LEAVING. >>WHAT IF WE SAY, HEY, TAKE THE FLOAT, DOMESTIC, MAKE IT RICH. HOLD A MEETING, STREAM IT. STREAM IT ON YAHOO FINANCE. THAT’S THE PLAN. >>WHAT IF THEY WENT TO THE STATE INSURANCE DEPARTMENT IN CALIFORNIA AND SAID, WE LOSE MONEY EVERY YEAR, WE WOULD LIKE TO SELL INSURANCE. THEY WOULD ALMOST CERTAINLY SAY NO WAY. TO MAKE UP FOR MORE IN TODAY’S MARKET ACTION LET’S GO TO SCOTT GAMM ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. WHO RAN AWAY WITH IT TODAY IN TERMS OF BEING ABLE TO PARTICIPATE IN THIS RALLY? WHO ARE THE BIGGEST WINNERS? :THE TOP PERFORMING STOCKS WITHIN THE DOW WERE CATERPILLAR, HOME DEPOT, AND NIKE. THE LAGGARDS WERE SOME OF THE SAFER, HIGHER YIELDING STOCKS. WE CALL THEM RECESSION PROOF, WERE TALKING ABOUT JOHNSON & JOHNSON, COCA-COLA, AND PROCTER & GAMBLE. WE HAD SEVERAL FACTORS CAUSING TODAY’S RALLY. SOME OF THE POSITIVE TRADE HEADLINES RESOLVE THIS MORNING, AND WE HAD A BROADER RECOVERY IN BOND YIELDS WITH THE 10 YEAR TREASURY YIELDS GOING BACK ON 1.5%. IT STILL BELOW THE TWO YEAR YIELD. WE ALSO HAD IMPORTANT CONSUMER DATA TODAY. WE HAD THE UPDATED REVISION TO SECOND-QUARTER GDP, THE SAW AND UPWARD REVISION TO CONSUMPTION. THAT IS A LAGGING INDICATOR. IT IS ANOTHER CLUE OF HOW THE CONSUMER IS DOING. ON THE SAME CONSUMER KNOW, YET EARNINGS FROM RETAILERS TODAY, INCLUDING DOLLAR GENERAL. THAT WAS THE BEST PERFORMING STOCK IN THE S&P 500, UP ALMOST 11% TODAY. THEY SAW A 4% GAIN IN SAME- STORE SALES YEAR-OVER-YEAR. THAT’S WELL ABOVE EXPECTATIONS. THEY RATE THEIR GUIDANCE. ANOTHER BIG GAIN WAS UNITED RENTALS. THEY WERE UP 5%. THERE’S NOT A LOT OF HEADLINES SURROUNDING UNITED RENTALS. WE ARE EXPECTING THE HURRICANE TO HIT FLORIDA THIS WEEKEND. WE HOPE THERE IS NO DAMAGE. IF THERE IS, THAT COULD SPUR EXTRA DEMAND FOR RENTAL EQUIPMENT FROM THE LIKES OF UNITED RENTALS. ONE TRADER, MOMENTS AGO, TOLD ME THAT HE SIZE SURGEON HOME DEPOT SHARES TOWARD THE FINAL MOMENTS OF TRADING. AS I MENTIONED, HOME DEPOT WAS THE SECOND BEST PERFORMANCE STOCK IN THE DOW. HE THOUGHT IT WAS ALSO DUE TO THE HURRICANE. >>SCOTT GAMM, WILL TALK WITH YOU TOMORROW. >>THE MOMENT WE HAVE ALL BEEN WAITING FOR, LET’S GET TO THIS WEEK IN TRUMP. THE TRUMPMOMETER HAS JOINED US AT THE DESK. WHAT IS THE STORY FOR THE PRESIDENT? CONGRESS IS STILL NOT IN SESSION. HIS PHONE IS CLOSE BY HIS SIDE. >>EVERYBODY WATCHES WITH DIVINE DOWN, THE SECOND THEY SEE TRUMPMOMETER TO SEE WHAT IS GOING TO HAPPEN. THE STORY THIS WEEK IS CHINA TO THE RESCUE. CHINA IS NULLIFYING PRESIDENT TRUMP, SAYING THAT WE WILL NOT ESCALATE ANY FURTHER. WE WILL LET TRUMP HAVE THE LAST WORD ON THIS. HE MADE THE LAST MOVE WITH THE NEW TARIFFS THAT WENT UP LAST FRIDAY. IT SENT THE MARKET PLUNGING ON FRIDAY. THEY SAY WE WILL NOT DO ANYTHING MORE. THIS IS A FALSE POSITIVE. I THINK THE MARKETS ARE INTERPRETING THIS AS A SIGN THAT CHINA WILL GIVE IN. I THINK THAT IS COMPLETELY FALSE. THERE ARE OTHER THINGS THEY CAN DO THAT DON’T LOOK LIKE ESCALATION, SUCH AS, THEY CAN START OFFERING MORE FAVORABLE TRADE TERMS TO OTHER TRADING PARTNERS BY SAYING, FOR EXAMPLE, THEY GIVE EUROPEAN COMPANIES, BETTER ACCESS TO THE CHINESE MARKET THAN AMERICAN FIRMS. THAT’S NOT ESCALATION. THAT IS DE-ESCALATION. THAT’S ONE THING THEY CAN DO. THERE ARE OTHER THINGS. SO MAKE A REFRAIN THAT WE OFTEN HEAR FROM VARIOUS STRATEGISTS AND FOLKS THAT COME THROUGH, THERE WILL BE A DEAL. THERE IS A PATHWAY TO A DEAL. I DON’T FIND THAT CREDIBLE AT ALL, GIVEN WHAT HAS BEEN HAPPENING. AS YOU SEE THE TRADE WAR, IT FEELS LIKE IT IS THE SAME STUFF. IT WILL JUST BE A PERMANENT FEATURE OF HIS PRESIDENCY. >>JOSEPH IN A MENTAL PROBLEM, THE CHINESE WILL NOT GRANT THIS FOR TRUMP. IT MAKES IT LOOK LIKE THEY BACK DOWN TO PRESIDENT TRUMP. THERE ARE TWO PLUMP FLAWS. THE TARIFFS ARE BAD TOOL, THEY ARE ASKING THE CHINESE TO DO THINGS THEY WILL NOT DO. THEY ARE DOING IT IN A PUBLIC WAY THAT DOES NOT ALLOW THE FACE-SAVING THAT YOU NEED IN NEGOTIATIONS LIKE THIS. YET TO CREATE A PATHWAY TO AN OUTCOME WHERE IT LOOKS LIKE BOTH SIDES WON SOMETHING AND THEY CAN GO BACK TO THEIR CONSTITUENTS BACK HOME AND SAY, LOOK WHAT I GOT FOR US. TRUMP HAS CREATED THIS, HE HAS POSITIONED US IN SUCH A WAY THAT HE’S DONE EVERYTHING PUBLICLY, HE CALLS HIM AN ENEMY OF THE UNITED STATES. HE MAKES HIS DEMANDS PUBLIC. FOR THAT REASON, THE ONLY THING THAT HE CAN REALLY DO IS AGREE TO SOME LESSER DEAL THAT IS COSMETIC, WHERE HE DOES NOT GET WHAT IS ASKING FOR. I THINK AT THIS POINT, TIME IS ON CHINA’S SIDE NOT TRUMP’S, DUE TO THE U.S. ELECTION. THEY WILL DIG AND IT SEALS THE CLOSER WE GET. THOSE LIKE HIM WILL ROLL THE DICE, MAYBE YOU WON’T GET REELECTED. MAYBE WE CAN HELP WITH THAT. THIS IS LAST WEEK’S READING. WE GAVE TRUMP A FAILING GRADE DUE TO HIS ESCALATION. THIS WEEK, WE GO TO THIS. >>HE MOVES UP BY ONE NOTCH. WHY? TONIGHT HE DIDN’T DO ANYTHING. IT WAS CHINA, BASICALLY SAYING, WE WILL LEAVE THINGS WHERE THEY ARE. WE DO KNOW THAT TRUMP WAS LYING ABOUT THAT PHONE CALL. ASSUMING THAT IS A BIZARRE NEW TURN. I BET THEY WON’T KNOW. BUT HE WILL FIND OUT. JUST A HAVE A PHONE CALL. STUDENT PEOPLE ARE LIKE, ALL RIGHT, I GUESS. TWITTER SPECULATES THAT HE GOT ONE OF THE JUNK MARKETING CALLS FROM 70 PEDDLING SOMETHING IN CHINA, AND HE THOUGHT IT WAS THE PRESIDENT. HE HAS DONE NOTHING. JACKIE IS A NOTHING TO PUSH THIS FORWARD. NEXT WEEK IS THE WEEK WHEN THE NEW CONSUMER TARIFFS WILL HIT. BRING IT, IT WILL BE GREAT. JACK ASKED WEEK WILL BE A BIG WEEK. THE TRADE WARS ARE GOOD AND EASY TO WIN. >>THIS IS SEPTEMBER 1. THAT’S WHEN EVERYONE COMES BACK FROM SUMMER VACATION? :I THINK IT IS THE SECOND WEEK IN SEPTEMBER. EXACTLY MY GET THINGS HAPPENING. ALL WE’VE HAD FOR THE LAST MONTH IS TRUMP TWEETING. JACK WILL HAVE SOME MORE NAME- CALLING AND PRESS CONFERENCES. W MIGHT HAVE MORE HEARINGS ON HIS TAX RETURNS, OR WHATEVER. CONGRESS HAS NEVER APOLOGIZED FOR THAT. HAVE NO ROLE IN THE TRADE WAR. SO MAKE YET. >>IT’S ALWAYS GOOD TO HAVE YOU.>>>YOU START TO FEEL A BIT OF AFFECTION FOR HER. SO MAKE I DON’T WANT TO WRITE ON IT WITH MY PEN.:YOU FEEL PROTECTIVE OF THE TRUMPMOMETER. IT’S A GREAT PIECE OF HARDWARE. WE WILL DIG DEEP INTO THE OIL AND GAS INFRASTRUCTURE WITH THE CEO OF MISTRESS. WE ARE LOOKING AT THE SPACE OF FUEL. LET’S LOOK AT HOW ENERGY NAMES TRADED IN TODAY’S MARKET.>>>THE TRUMP ADMINISTRATION IS LOOKING TO ROLL BACK OBAMA ERA REGULATIONS ON MONITORING GREENHOUSE EMISSIONS FOR COMPANIES. JOINING US TO DISCUSS THIS AND MORE IS THE PRESIDENT AND CEO OF MISTRESS GROUP, DENNIS. THIS COMPANY HAS BEEN PUBLIC FOR 10 YEARS. FOR PEOPLE THAT ARE NOT FAMILIAR WITH MISTRESS, YOU GUYS TOUCHED A LOT OF DIFFERENT INDUSTRIES. TELL ME, IN MY LIFE, WHAT ARE YOU GUYS DOING THAT WOULD IMPACT ME? >>THINGS FOR HAVING US. WE ARE A LEADING ASSET INTEGRITY MARKET PROVIDER. THE COUPLE GET A WAY OF SAYING WE SERVICE HEAVY INDUSTRIES LIKE GAS, OIL, PETROCHEMICAL, POWER, AEROSPACE, AUTOMOTIVE, AND WHAT WE DO IS PROTECT THOSE ASSETS MAKE SURE THEY ARE SAFE AND OPERATING AS A SHOULD BE FOR YEARS TO COME. THAT WAY WE DO INSPECTIONS ON THEM, WITH ONLINE TECHNIQUES AND ENGINEERING, DATA MANAGEMENT, MANY THINGS WE DO FOR THE CUSTOMERS TO MAKE SURE IT IS MANUFACTURED AND OPERATING CORRECTLY. >>WE HEAR FROM POLITICIANS THAT BEMOAN THE STATE OF INFRASTRUCTURE HERE IN THE UNITED STATES. YOU GUYS ARE SAYING A LOT OF DIFFERENT PRESSURE POINTS INSIDE OF THE U.S. GRID. WHAT IS YOUR VIEW ON THE STATE OF U.S. INFRASTRUCTURE BROADLY? WHAT STEPS CAN WE TAKE TO SHORE UP THE WEAK SPOTS? >>DIFFERENT THINGS, THE PIPELINES HAVE NOT HAD A LOT OF MANDATED INSPECTIONS OVER THE LAST FEW YEARS. THEY’RE CHANGING THAT LATELY. THE CHEMICAL PLANTS AND REFINERIES HAVE NOT HAD A NEW ONE BUILT SINCE 1976. YOU HAVE A LOT OF AGING INFRASTRUCTURE. I DO BELIEVE THERE ARE MORE REGULATIONS OUT THERE. THERE IS MORE TO COME. THERE IS A LOT OF COMMON SENSE TO MAKE SURE THAT THE MECHANICAL INTEGRITY OF THE ASSETS ARE OPERATING SO THE OWNERS CAN KEEP THEM UP AS THEY PLANNED. WITHOUT HAVING THAT KIND OF PLANNING, LIKE WHAT WE DO WITH THE ONLINE MAINTENANCE AND INSPECTIONS, YOU WILL SEE MORE PROBLEMS. WHAT WE BELIEVE, THE TYPES OF SOLUTIONS WE BRING TO THE MARKET, GIVE THEM AWAY AND THE PASSWORD TO OPERATE FOR YEARS AND YEARS SAFELY. JACKIE TALK ABOUT REGULATIONS AND THE TRUMP ADMINISTRATION LOOKING TO ROLL BACK THE METHANE REGULATIONS, SINCE YOU WORK IN THE SPACE OF NATURAL GAS AND OIL. WILL THIS HAVE ANY IMPACT ON YOUR BUSINESS AT ALL? :OUR BUSINESS IS DRIVEN BY COMPLIANCE AND RUNNING TO MAINTAIN. THE SPICE COME FROM THINGS LIKE CAPITAL PROJECTS. THAT CAN COME FROM PROJECTS LIKE THAT AND I AM OH 2020 FOR DIESEL CLEANUP. ANYTHING THAT IS CHANGING THE INFRASTRUCTURE AND CHANGING THE WAY THE COMPLEX REFINERIES OPERATE WILL HELP US IN WHAT WE DO FOR OUR BUSINESS. >>SOMETHING YOU TALKED ABOUT, BRIDGES, THIS IS SOMETHING THAT PEOPLE GO OVER ALL THE TIME. PEOPLE KNOW WHEN THE BRIDGE COLLAPSES. WE HEAR ABOUT THE STATE OF BRIDGES. WHAT IS SOMETHING YOU ARE INVOLVED IN TO MAKE SURE THAT WE ARE OUT AHEAD OF SOME OF THESE TIRED PIECES OF KEY INFRASTRUCTURE IN THE STATES? >>THAT’S A GREAT QUESTION. THE THINGS WE DO ARE ON THE CABLE STAY BRIDGES, THE ONES WHERE YOU SEE THE LONG SPANS ON EITHER SIDE, HOLDING UP THE DECK. WE HAVE ONLINE MONITORING THAT WORKS 24 SEVEN TO MAKE SURE THAT IT STAYS SOUND. WE ARE HEARING, AS THE CABLE SPRAY AND CORRODE, AND START TO BREAK INSIDE OF THE MAIN CABLE. THE MAIN CABLES I MADE UP OF THOUSANDS OF SMALLER CABLES. WE CAN MONITOR THAT 24/7 AND LET THE OWNERS KNOW HOW THAT PROGRESSES. WHAT THEY CAN DO IS THEN GO IN AND REPAIR THE CORROSION. THAT’S NORMALLY CAUSED BY WATER INTRUSION. THEY CAN MAKE SLIGHT CHANGES IN HOW THAT BRIDGE IS OPERATING. ALL YOU HAVE TO DO IS GO IN THERE AND FIX THE OUTER COATING. WE CAN HAVE THE MONITOR IT AND REPAIR THE COATINGS AS WELL. >>THANK YOU FOR JOINING US FROM THE FLOOR OF THE NEW YORK STOCK EXCHANGE. >>THANK YOU FOR HAVING US. >>COMING UP, WHAT WE ARE WATCHING TOMORROW. WE HAVE THE LOOKAHEAD. FIRST COMING OF THE INTERESTING CONVERSATION YOU HAD WITH YOUR FRIEND ABOUT THE ORIGINATION OF AVOCADO TOAST? THAT CAN BE A PODCAST FOR EVERYONE TO ENJOY, IF SPOTIFY HAS ITS WAY. >>THE WRITERS ARE HAVING TOO MUCH FUN. [ LAUGHTER ]>>>THIS IS MILES WITH THE LOOKAHEAD OUT WILL MAKE HEADLINES ON FRIDAY. >>FRIDAY BRINGS AUGUST TO A CLOSE. MANY MARKETS WILL NOT FORGET THIS. THROUGH THURSDAY, THE S&P WAS OFF 3% SO FAR THIS MONTH. MANY INVESTORS WILL TAKE THE LOSS. THEY WILL BE HAPPY TO MOVE PAST WHAT HAS BEEN A MADDENING MONTH TO FOLLOW MARKETS. WE’VE SEEN PRESIDENT TRUMP SHIFT TRADE POLICY SEVERAL TIMES VIA TWITTER. MANAGED EVALUATION WITH CHINA’S CURRENCY, MOVE THAT SEVERAL PERCENTAGE POINTS. TRUMP COMPLAINED ABOUT JAY POWELL. ON ONE HAND, NONE OF THIS IS NEW STUFF. HE ORCHESTRATED TRADE POLICY, ACCUSED CHINA OF CURRENCY MANIPULATION, MANY TIMES DURING HIS PRESIDENCY. THE WAY INVESTORS REACTED TO EACH OF THE STORIES SUGGESTED THAT WE WERE IN A NEW PHASE FOR MARKETS. THEN AGAIN, THE IDEA OF SOMETHINBEING IN A NEW PHASE FOR MARKETS IS NOT EXACTLY A NEW IDEA IN THE TRUMP ERA. THE REAL STORY OF AUGUST, AND THE ENTIRE TRUMP EXPERIENCE FOR INVESTORS IS THAT MANY MOMENTS SO MY PARADIGM SHIFTS WHEN THE SIMPLE EXPLANATION MIGHT BE THAT ALL EXPLANATIONS OF WHAT HAS BEEN HAPPENING IN THE MARKETS WILL FALL SHORT, BECAUSE THE THING HAPPENED ON NOVEMBER 8 , 2016. WE KNOW FOR SURE THAT WAS THE BEGINNING OF A NEW ERA. THAT WAS THE MOMENT THAT WE ARE STILL LIVING IN RIGHT NOW. TURNING TO THE CALENDAR ON FRIDAY ON THE ECONOMIC DATA SIDE, THINGS WELL BE BUSY. WE GET AUGUST READINGS ON MANUFACTURING ACTIVITY IN THE MIDWEST AS WELL AS THE UNIVERSITY OF MICHIGAN’S REPORT ON CONSUMER SENTIMENT. ON THE EARNING SIDE, WE HAVE ONE REPORT, CAMPBELL SOUP WILL BE THE ONLY NOTABLE COMPANY REPORTING THEIR QUARTERLY RESULTS. >>THAT IS GOOD. >>ALTO BEAUTY SHARES ARE DOWN. THEIR EARNINGS-PER-SHARE CAME DOWN AT $2.76. THE STREET ESTIMATE WAS $2.79. WE ARE SEEING THE STOCK SHARPLY LOWER. HERE’S WHAT IS HAPPENING, THE COMPANY HAS CUT THE FISCAL 2019 OUTLOOK TO REFLECT ANTICIPATED INDUSTRYWIDE SALES HEADWINDS AND COSMETICS. THE e-COMMERCE SALES FOR THE REST OF THE YEAR WILL BE UP. FOR THE FIRST SIX MONTHS OF FISCAL 2019, A NET SALES INCREASE OF 12.5% TO 3409 $.6 MILLION. THAT IS COMPARED TO $3,000,031.9 MILLION IN THE FIRST SIX MONTHS OF FISCAL YEAR 2018. A COMPARABLE SALES INCREASE WAS 6.6%, COMPARING TO THE INCREASE OF 7.3% IN THE FIRST SIX MONTHS OF FISCAL 2018. IT WAS NOT THAT LONG THAT THIS WAS THE BEST PERFORMING STOCK IN THE S&P 500.:THE STOCK IS A MONSTER. SO THAT 20% IS NOTHING TO SNEEZE AT, I DON’T NEED TO TELL YOU HOW WELL THE CONSUMER IS DOING.. COMPANY COMES OUT, AND CUTS THE COMP SALES AND GUIDANCE. THEY HAVE A GROWTH OF 4-6%. THAT IS DOWN FROM 6 DOWN TO 7%. YOU LOOK AT WHERE THEY GO, THEY DID CUT ONE PART. THAT’S 350 MILLION DOLLARS. THEY LOOKED FOR $380 MILLION- $400 MILLION IN INVESTMENTS. IT HAS BEEN A SECTOR THAT IS ON FIRE. THE STOCK HAS DONE INSANELY WELL OVER THE LAST COUPLE YEARS. THEY SAID THE COSMETICS THE BASE IS COOLING OFF. LAST TIME I CHECKED, PEOPLE GO ON INSTAGRAM A LOT. THE AIRPLANE BACK ON THEIR OWN INVESTMENTS, AND THEY HAD AN AGGRESSIVE SCHEDULE. >>ONE OF THE HEADWINDS IN THE COSMETICS PHASE? IS THAT A BROAD CONSUMER STORY? IS THAT SOMETHING IS RIGHT TO COSMETICS? >>WE HAVE LADY GAGA TEAMING UP WITH AMAZON. WE HAVE SO MANY DEEP BRANDS CIRCUMVENTING WHAT IS HAPPENING AT ULTA. PEOPLE COULD STILL BE PURCHASING MAKEUP , THEY DON’T NEED TO GO DO IT THERE. WHERE THE STORY WE ARE TRYING TO GET ON, IS THAT THE DOLLAR GENERAL? WHAT IS THE OTHER ONE? DOLLAR TREE OR DOLLAR STORE? THEY HAVE A MAKEUP LINE THAT IS FLYING OFF THE SHELVES. AND PEOPLE REALLY LIKE IT. THAT IS NOT AT 1025 BEAUTY. WE’VE SEEN BEAUTY BE A COMPONENT FOR TARGET AND WALMART. IT’S NOT JUST A CRIMESTORY.COM FIVE STORY AND MORE. I THINK THIS IS A STORY TO HAS BEEN FOR TWO OTHER COMPANIES. >>YOU GET INTO LABOR. >>THE BEAUTY SPACE IS PROBABLY UNDERCOVERED IN BUSINESS MEDIA. MOST INVESTORS ARE MEN. THE DEMAND IS NOT THERE FOR WHAT IT SHOULD BE. I’M INTERESTED TO LOOK AT THIS. WILL READ THE COLLATOR. WILL THINK ABOUT, IF THIS IS A TRADE STORY. I SUSPECT IT IS NOT. I DON’T THINK THIS IS A MACRO STORY. THE MICRO SHIFTS IN THE BEAUTY SPACE THAT YOU OUTLINED, AWAY FROM THE BIG BOX, AS IT WERE. THAT IS WHAT ULTA IS. AGAIN, IT HAS BEEN AN AMAZING RUN. THEY ARE CLEARLY THE LEADER IN THIS SPACE. >>WAS SEEN AN OVERALL SLOWDOWN IN BUSINESS SPENDING. THAT IS AN IMPORTANT THING HAPPENING IN THE SECOND AND THIRD QUARTER OF 2019. IT HAD A MODEST BUMP LAST YEAR. WAS NOWHERE NEAR WHAT THE SUPPORTERS OF THE TAX CUT WOULD BE. BUSINESS SPENDING IS FIZZLING. CEOS ARE NERVOUS, BECAUSE OF THE TRADE WAR AND THE SIGNS OF THE SELF-FULFILLING PSYCHOLOGICAL RECESSION. >>A BIG DIVE FOR ULTA NOW. WE WILL CONTINUE TO WATCH THAT STOCK. >>HAVE YOU EVER WANTED TO CREATE YOUR OWN PODCAST? SPOTIFY COULD BE OFFERING YOU THE CHANCE. THIS IS AN IN APP, CREATE PODCAST BUTTON IS BEING TESTED IN THE MUSIC STREAMING GIANT. IT WILL BE BEING TESTED. THIS WAS UNCOVERED BY TECHNOLOGY BLOGGER JANE WONG. SHE POSTED THE DISCOVERY ON HER TWITTER. ACCORDING TO HER, IF YOU CLICK ON THE BUTTON, TAKES YOU TO A TAKEOVER PROMOTION THAT DIRECTS YOU TO DOWNLOAD ANCHOR, THE PODCAST CREATION APP THAT THEY ACQUIRED IN FEBRUARY. WE LOOKED FOR THIS EARLIER. WE COULD NOT FIND IT YET. SHE’S ONE OF THE PEOPLE THAT GOES IN AND FIGURES THAT OUT. >>SHE LOOKS AT THE API AND KNOWS HOW THE STUFF WORKS. >>IT’S ALL BACK CHANNEL SECRET AREAS. >>SHOULD I DOWNLOAD THAT? SHOULD WE HAVE A PODCAST? RICK HAS ONE, I WANT ONE. >>WE HAVE A GUY WHO DOES THAT. LIKE EVERYONE WILL COMPETE WITH YOU, HOW DO YOU COMPETE WITH THAT? >>IT DOES SOUND SILLY WHY WE NEED A PODCAST FROM EVERYBODY. PEOPLE SAID EVERYTHING ABOUT THAT WITH HAVING A YOUTUBE CHANNEL. LOOK HOW THAT HAS TAKEN UP. PEOPLE ARE YOUTUBE STARS. IT ALLOWS PEOPLE TO FIND NICHES YOU NEVER KNEW EXISTED. THEY PROMOTE THEIR QUIRKINESS, WHATEVER IT MIGHT BE. IT IS A THING. IT TOTALLY MAKES SENSE TO DO THIS AS A PODCAST. I HAVE TROUBLE FIGURING OUT WHY IT WILL LISTEN TO 30,019-YEAR- OLDS TELLING ME WHAT IS ON THEIR MIND. SOMEBODY WILL. THEY WILL FIGURE OUT A WAY TO MAKE MONEY OUT OF IT. >>I THINK IT IS EARLY IN THE PODCAST SPACE. >>IS PART OF THE PLAY. THAT’S WHY SPOTIFY IS GOING AFTER IT. THERE HAS BEEN A SNAPPING UP OF A LOT OF THESE TINY STARTUPS. THEY MAKE YOU THINK OF WHAT WORKS IN PODCASTING, THERE ARE ONLY LIKE TWO THINGS. CRIME STORIES, EVERGREEN, TRUE CRIME, AND INTERMITTENT COMMENTARY. TWO OR THREE TIMES A WEEK, SPORTS, OR NEWS. THE DAILY PODCAST I CAN THINK OF , THAT IS EVERY DAY, PRETTY CONCISE, AND IS ONE THING. I THINK THERE IS THE ABILITY FOR THERE TO BE 50 DAILIES THAT ARE JUST AS SUCCESSFUL. THEY PULLED A BUNCH OF REPORTERS OFF OF THEIR BEADS TO DO THAT PODCAST. IT IS A LOT OF WORK. THAT’S WHY IT’S A GOOD PRODUCT. I THINK IT’S EARLY. IN HIS ROOM LIKE OURS IS GRAPPLING WITH IT, DO WE TAKE RESOURCES AWAY FROM THE LIVE STREAMING PROGRAM AND TEXT TO DEVOTE PODCAST? WE HAVE ONE GUY. HOW MANY MORE WILL WE HAVE? DURING THE TESTING TO GET YOUR BRAIN AROUND, WHEN TWO PEOPLE HAVE THE MIND SPACE WITH A MIND SHARE TO DEVOTE TO PODCASTS, GIVEN THE OTHER SCREEN ACTIVITY? IT TURNS OUT, WE DO. WE STILL DRIVE, WE DRIVING CARS AND TRAINS, OR BUSES. I GUESS WE WALK AROUND. THIS IS SOMETHING THAT PEOPLE ENJOY. >>WE HAVE THE AIR PODS IN ALL THE TIME. BOOKS ARE NOT DEAD EITHER. BOOKS ARE ALIVE. LIKE I LIKE HIM GOING INTO THE AREAS. HE FINDS THE AREAS THAT ARE KILLED BY POPULAR MEDIA AND SAYS, THIS IS MY NICHE BECAUSE IT’S NOT DEAD. I GET THE LAST MAN STANDING STRATEGY. COMING UP HERE ON “THE FINAL ROUND”, WE HAVE THE TOP TAKE OF THE DAY . JUUL, THE E-CIGARETTE COMPANY IS UNDER INVESTIGATION BY THE FTC. AS THE COMPANY SAYS, THEY’RE TRYING TO STOP UNDER AGED VAPING. THE CEO TELLS CBS, DON’T BABE, DO NOT USE OUR PRODUCT, WE WILL DISCUSS ALL THINGS JUUL, COMING UP AFTER THE BREAK.>>>WELCOME BACK TO “THE FINAL ROUND” . JOIN ME FOR THE FINAL 25 MINUTES, MY COHOST, JEN ROGERS AND OUR COLUMNIST, RICK NEWMAN. WOW, RECORD, YOU ARE SO POSITIVE TODAY. >>WAS HE WITH THE MARKET SETTLED ON THIS THURSDAY. PERHAPS RICK IS FIRED UP BY GREEN ON THE SCREEN. THE DOW IS UP 320 POINTS. THE NASDAQ IS UP 1.5%. WE HAVE SEEN SOME BACKUP IN THE YIELD AS WELL TODAY, WE HAVE 36 HOURS OR SO REMOVED FROM THE RECORD LEVEL ON THE LONG BOND. WE HAVE A LOT OF STUFF GOING ON IN THE MARKETS. YOU KNOW THE DEAL, THE YIELD IS DOWN AND THE STOCKS ARE UP. LET’S LOOK AT WHERE THIS SHAKES OUT. TOMORROW IS THE LAST TRADING DAY. IT HAS BEEN AN EVENTFUL MONTH IN AUGUST. WE ARE 2.5 WEEKS AWAY FROM THE NEXT MEETING. >>YOU GUYS ME SO MUCH. >>>DOES MEET AND CUT RATES. THEY TALK, THEIR BLACKOUT PERIODS. IT’S NOT LONG ENOUGH. >>THEY ARE BUTCHERS. >>THAT IS 10 MORE TRUMP TWEETS TRASHING THE FED BETWEEN NOW AND THEN. >>10? I THINK THAT’S CONSERVATIVE? >>THAT’S THREE WEEKS FROM YESTERDAY, 21 DAYS, EVERY OTHER DAY. >>IS ONE FED BASHING TWEED EVERY THREE DAYS. WE WILL DO THE NUMBERS. I’LL RUN THE NUMBERS TOMORROW. >>I THINK HE ACCELERATED IN AUGUST. HE IS DONE LIKE FIVE. >>JUSTIN, YANKEE GLOBAL ENTERPRISES AND SINCLAIR BROADCAST GROUP, AND AMAZON HAVE ANNOUNCED THE PURCHASE OF THE YES NETWORK FOR $3.47 BILLION. FOR THOSE THAT DON’T KNOW, THE YES NETWORK BROADCAST GAMES, PROGRAMS, AND SPECIALTY CONTENT FOR THE NEW YORK YANKEES, THE BROOKLYN METS, THE FC AND THE WNBA, NEW YORK LIBERTY. THERE IS BEEN A BIG GUESSING GAME ON WHAT DISNEY WOULD DO WITH THIS PROPERTY. THIS DOES GO TO THE 21st CENTURY FOX DEAL. THEY DID HAVE TO SELL THESE OFF WITH THE AMAZON NAME IN THERE, THAT IS THE MOST EXCITING PART. WHAT IS THIS DUE TO STREAMING WARS. WE DON’T HAVE ANY DETAILS AT THIS POINT. THE LIVE TV ASPECT, BECAUSE NOT EVERYTHING ON YES IS LIVE, BUT HAVING SOME LIFE OFFERINGS CHANGES THE PRIME QUALITY. THEY DO SOME FOOTBALL GAMES. WHAT HE THINK IT MEANS? :IT IS RELATIVELY SMALL. THIS IS REGIONAL. YOU CAN SAY THIS IS LOCAL. >>RICK NEWMAN, YOU MUST NOT BE A YANKEE FAN. >>I AM NOT. >>THEY THINK THIS IS THE NATIONAL TEAM. >>YOU THINK PEOPLE FROM DALLAS AND TEXAS AND NEBRASKA WILL BE TUNING INTO YANKEE GAMES? >>THIS IS THE NEW YORKERS A VIEW OF THE WORLD. THE YANKEES ARE BELOW THE PATRIOTS IN TERMS OF NATIONAL POPULARITY, I THINK. >>I THINK YOU ARE WRONG. TO MAKE IT ANY RATE, IT IS NOT A NATIONAL NETWORK. CAN WE AT LEAST AGREE ON THAT? WE KNOW AMAZON IS WILLING TO SPEND TO GET INTO LIVE STREAMING SPORTS. THEY’VE DONE THAT A BIT WITH THE NFL GAMES. IT IS GOOD FOR CONSUMERS. >>IT IS GOOD FOR ME. >>>ARE YOU A YANKEE FAN? >>THIS IS ONE THING YOU CAN WATCH WITHOUT CABLE. YOU HAVE YES ON CABLE? :YES. THAT GIVES YOU ONE MORE REASON TO CUT CABLE. >>CHANNEL 576. >>HE CAN’T HAVE CABLE BECAUSE HE HAS FILES. THAT’S ANOTHER CONVERSATION. WE ARE LOOKING AT TOP TAKES. WE ARE TALKING ABOUT JUUL. WHERE TO BEGIN HERE? THIS AFTERNOON, THE WALL STREET JOURNAL REPORTED THAT THE E- CIGARETTE COMPANY IS REPORTEDLY UNDER INVESTIGATION BY THE FTC FOR DECEPTIVE MARKETING PRACTICES, INCLUDING TARGETING MINORS. THEY SAY THEY ARE TRYING TO STOP UNDER AGED VAPING WITH THE NEW ID VERIFICATION CHECKOUT SYSTEM IN RETAIL. THEY ALSO, AS THE CEO HAD VERY INTERESTING THINGS TO SAY TODAY ON CBS THIS MORNING. >>IS NOT ONLY FORMER SMOKERS YOU ARE CONVERTING. SOME PEOPLE ARE STARTING JUUL, AND THEY’VE NEVER BEEN ON NICOTINE BEFORE. WHAT IS YOUR ADVICE TO THOSE PEOPLE? SOON I DO NOT VAPE YOU DO NOT USE JUUL. DON’T START USING NICOTINE. DON’T USE THE PRODUCT. YOU’RE NOT OUR TARGET CONSUMER. >>>DON’T USE IT. THIS COMES AS THE FDA DECLARED TEEN VAPING AND EPIDEMIC. >>DO YOU AGREE? SPIN I GUESS. WE HAVE TO STOP THE VAPING IN THE HIGH SCHOOLS. DISCONNECT MY KIDS TELL ME THAT ALMOST EVERYBODY HAS TRIED IT. THAT IS THE PROBLEM. ONCE YOU TRY, IT’S HARD TO STOP.>>NICOTINE IS INCREDIBLY ADDICTIVE. WE TALKED ABOUT THIS FOR LONG TIME. IS IT STARTING TO CATCH UP WITH THEM? I WOULD SAY FLEW UNDER THE RADAR OF THE GOVERNMENT FOR A WHILE. >>THERE ARE MANY THINGS HERE. IT IS THE CLASSIC, YOU HAVE TOO MUCH SUCCESS FOR YOUR OWN GOOD. THE COMPANY DID NOT EXIST 5 YEARS AGO. THEN LAST YEAR, GETS THIS INVESTMENT, SO IT’S PAYING OUT $1 MILLION TO ALL OF ITS EMPLOYEES, BECAUSE IT ONLY HAS A COUPLE HUNDRED PEOPLE WORKING THERE. THEY GET BILLIONS OF DOLLARS OF INVESTMENT. EVERYONE IS RICH, AND THE SALES ARE THROUGH THE ROOF. THE GOVERNMENT IS LIKE, WHY IS TEEN TOBACCO USE ON THE RISE? THE ANSWER IS, BECAUSE OF JUUL. THE CEOS COMMENTS THERE WILL NOT BE THE LAST TIME WE HEAR HIM BEING LIKE, DON’T LOOK AT US , DON’T LOOK AT ME, WERE TRYING TO SAY THE RIGHT THING. THE FTC INVESTIGATION IS WITH THE MARKETING PRACTICES. >>THAT INVESTMENT PACKAGE, THAT WAS SUCH A DUMB IDEA, DON’T GET IN BED WITH THEM. THEN WHEN YOU HEAR HIM TALK ABOUT IT. I WAS LIKE, OH YEAH, IF THE MISSION IS TO CONVERT FORMER SMOKERS, IF THAT IS YOUR MISSION, THEN TO HAVE THE WHOLE DATABASE, THE KNOWLEDGE THAT COMES FROM THAT COMPANY, THEY HAVE LIST OF THE 70 MILLION SMOKERS. THEY HAVE THE RESEARCH. YOU CAN TARGET THE SMOKERS. THEN IT’S LIKE, OKAY, I GUESS THAT MAKES SENSE. >>>BOTH THINGS CAN BE TRUE, THAT IS THE TARGET CUSTOMER, BUT NOBODY TURNS DOWN ACCIDENTAL GROWTH, NO MATTER WHERE IT COMES FROM. IT TURNS OUT THAT THIS CATCHES ON AMONGST YOUNG PEOPLE. THAT’S NOT TOUGH TO FORESEE. THERE IS A COOL FACTOR TO IT. HE CAN SAY ALL HE WANTS, IF YOU’RE UNDER 21, DON’T VAPE. THAT MAKES PEOPLE WANT TO DO IT MORE. IT MAKES IT MORE WAS I COOL TO USE A PRODUCT WHEN THE CEO SAYS DON’T USE THE PRODUCT. >>I THINK THE STORIES ABOUT THE LUNG DAMAGE AND THE SEIZURES , CAN HELP. >>IF YOU ARE ADDICTED, YOU ARE ADDICTED. >>WE WILL SEE. SCHOOL STARTS NEXT WEEK. >>LAST NIGHT, YAHOO FINANCE MADE EVELYN MADE HER DEBUT, INTERVIEWING THE CEO OF IRIS NOVA, THE PARENT COMPANY LIKE DIRTY LEMON, AND THE DRUGSTORE. EMILY, I DON’T KNOW WHAT DIRTY LEMON IS. WHAT DID YOU TAKE AWAY FROM YOUR CONVERSATION WITH ZACH? >>DIRTY LEMON IS THE FLAGSHIP. ZACH SAYS THEY WILL TRY TO TAKE ON COCA-COLA. THEY ARE BACKED BY THE COMPANY. THEY HAVE A $15 MILLION SEED ROUND OF $60 MILLION EVALUATION IN DECEMBER. THEY SOLD 2 MILLION BOTTLES TO DATE SINCE FOUNDING IN 2015. ONE BIG DIFFERENTIATING FACTOR OF THEM IS THE DISTRIBUTION NETWORK. THEY ARE TEXT ORDER, 90% OF THE ORDERS ARE FULFILLED VIA TEXT MESSAGE. YOU PICK UP YOUR PHONE, TEXT THE CUSTOMER SERVICE LINE, AND AN AUTOMATED SYSTEM OR AN ACTUAL CUSTOMER SERVICE REPRESENTATIVE COMES IN TO FULFILL THE ORDER. THIS IS WHAT THE CEO HAD TO SAY ABOUT THIS TECHNOLOGY PLATFORM. >>THE BEVERAGE INDUSTRY IS IN A SIMILAR PLACE NOW WHERE NETFLIX WAS WITH THE MEDIA BACK IN 97. IT IS A VERY ANTIQUATED DISTRIBUTION SYSTEM IN PLACE RIGHT NOW. WE ARE BUILDING TECHNOLOGY TO SUPPORT THE NEXT ITERATION OF DISTRIBUTION OF CONSUMER PRODUCTS. IT’S NOT JUST BEVERAGES. THAT’S AN IMPORTANT KNOW. WE TEST US WITH BEVERAGES NOW. TECHNOLOGY WE ARE DEVELOPING COULD APPLY TO BEAUTY, PERSONAL CARE, HOME GOODS, OR ANYTHING WITH A HIGH VELOCITY THAT YOU REORDER ON A REGULAR BASIS. :ARE THESE AREAS THAT YOU’RE LOOKING TO TEST INTO UNDER THE IRIS NOVA PORTFOLIO? >>IT IS POSSIBLE. WE ARE FOCUSING ON BEVERAGES NOW. BEYOND THAT, THE ASPIRATION IS TO BUILD THE CONGLOMERATE OF THE FUTURE. THIS IS A CONGLOMERATE THAT TAKES AWAY A LOT OF THE FRICTION POINTS WITH THE DIFFERENT LAYERS THAT HAVE HISTORICALLY TAKEN AWAY FROM THE CUSTOMER EXPERIENCE. >>IRIS NOVA ANNOUNCED THEY WILL BE INVESTING $100 MILLION OVER THE NEXT 3-5 YEARS. THESE ARE BEVERAGE FOCUSED BRANDS. THEY’RE TRYING TO BUILD OUT THE BRAND PORTFOLIO UNDER THE IRIS NOVA PLATFORM. INSPECT DUMB OLD GUY PROGRAM, WHAT BEVERAGES DO THEY SELL? >>IT IS LEMON BASED AND SEES ALL. THAT IS THE CASE DRINK. EACH BEVERAGE, THEY HAVE MACHO, COLLAGEN, RETINOL-BASED DRINKS. THERE 15 CALORIES OR UNDER. IT’S LIKE A VITAMIN THAT HAS BEEN GROUND UP AND PUT INTO A DRINK. >>IS A SAYING WITH THE DISTRIBUTION THING. IT IS WRAPPED IN THE WHOLE COLLAGEN, HEALTH CRAZY STUFF. I CANNOT SEPARATE THE TWO IN MY MIND. >>>SAYS THE FORTHCOMING PRODUCTS WILL NOT ALL BE THAT MILLENNIAL, YOUNG WOMAN, WELLNESS BRAND. >>IS ALMOST LIKE A PARODY. >>SEA SALT WATER? WHATEVER. SO ALL RIGHT EMILY, GREAT JOB LAST NIGHT. AS FOR JOINING US TODAY. RICK NEWMAN HAVE A GREAT EVENING. YOU ARE OUTTA HERE. >>I’LL BE HAPPY TO. >>WHAT YOU MISSED TODAY ON YAHOO FINANCE. YOU ARE COMING RIGHT BACK, RIGHT AFTER THIS.>>>IT IS TIME FOR ALL OF THE BEST MOMENTS THAT YOU MISSED TODAY ON YAHOO FINANCE. LET’S CHECK IT OUT. >>>CONSTRUCTION IS FLAT. I MENTIONED THAT CRIMESTORY.COM DOES GOING INTO A DOWNTURN. LET’S FACE IT, THE INDICATORS DONE 18 MONTHS IN A ROW, THE GLOBAL ECONOMY IS SLOWING DOWN. >>THE TRADE WAR IS A PROBLEM. IT IS A HEADWIND THAT KEEPS THE FUNDAMENTALS FROM REALLY IMPROVING. >>THE DEVIL IS IN THE DETAILS. FOR THEM TO SAY, THEY WANT TO TALK, THAT’S FINE, THERE’S NOTHING WRONG WITH THAT. WE HAVE BEEN DOWN THIS ROAD BEFORE. THERE IS STILL SO MANY ISSUES THAT HAVE NOT BEEN RESOLVED. >>THERE IS SO MUCH INCONSISTENCY, VOLATILITY IN THE MARKETS ANYWAY. SMALL BUSINESS OWNERS, AND MANY OTHER SMALL BUSINESSES, WE HAVE SO MANY THINGS THAT WE CANNOT CONTROL, LIKE THE WEATHER, AND NORMAL COMMODITY MARKETS ARE HERE. WITH HIS IMPETUOUS DESK, MAKES IT MORE VOLATILE THAN NORMAL. >>WHERE BIG ADVOCATES OF OPENING OPPORTUNITY IN THE CANADA SPACE FOR THOSE IMPACTED ON THE WANT DRUGS. EARLIER THIS WEEK, WE LAUNCHED THE LEAP PROGRAM,THIS IS A LICENSE, EDUCATION, APPLICATION PROGRAM. IN ILLINOIS, THOSE AFFECTED BY THE WAR ON DRUGS, OFTEN IN THE MINORITY COMMUNITY, HAVE THE ABILITY TO BE FIRST IN LINE FOR THE NEW PEOPLE COMING INTO THE INDUSTRY. >>WAS A LONG TIME AGO THAT CHINA WOULD BE A LONG, DRAWNOUT SITUATION, NOT LIKE CANADA AND MEXICO THAT WAS EASY. THEY CLOSED THAT QUICKLY. CHINA IS A DIFFERENT GAME. >>I DO THINK THE BONDS MAINTAIN THEIR SAFE HAVEN STATUS. THIS IS IN TIMES OF STRESS. IF WE JUST MUDDLE ALONG, YOU WILL DO BETTER IN THE HIGHER YIELDING EQUITIES, OR FIXED INCOME. IN TIMES OF TRUE RISK, THERE IS NO BETTER INVESTMENT COMING UP, WE TALKED TRADE WERE IN HERE FROM GREG. WE ARE BACK, RIGHT AFTER THIS.>>>STOCKS RALLIED ON THURSDAY AFTER WORD OF CY JANET CHINA SUGGESTING THAT THEY DON’T WANT TO PRESS ON THE YEAR-LONG TRADE WAR WITH THE UNITED STATES. THEY MAY BE WILLING TO APPROACH THE DISPUTE WITH A CALM ATTITUDE. GREG IS HERE, THE AGF U.S. POLICY STRATEGIST. HE IS DISCUSSING WHY INVESTORS SHOULD BE SKEPTICAL OF THE CHAPTER AND THE TRADE WAR. >>THE DEVILS IN THE DETAILS. FOR THEM TO SAY THEY WANT TO TALK, THAT’S FINE. THERE’S NOTHING WRONG WITH THAT. WE HAVE BEEN DOWN THIS ROAD BEFORE. THERE IS STILL SO MANY ISSUES THAT HAVE NOT BEEN RESOLVED, THE SUBSIDIES FROM CHINA TO THE STATE OWNED COMPANIES. THE THEFT OF U.S. INTELLECTUAL PROPERTY RIGHTS, ON AND ON. TALKING IS GOOD. DETAILS ARE BETTER. >>IT SEEMS AS THOUGH, THE STATEMENT INDICATES THAT CHINA, AT THIS POINT IS NOT GOING TO COME OUT WITH NEW, RETALIATORY TARIFFS. MAYBE? IS THAT A GOOD THING? >>ABSOLUTELY. YOU CANNOT SAY THAT IS BAD. WERE NOT SEEING A FURTHER ESCALATION. YOU GET THE FEELING THAT EVERYONE, NOT JUST IN THE UNITED STATES, BUT EVERYONE WAS UNNERVED BY THE SELLOFF ON FRIDAY. IT GOT UGLY WHEN WE WERE DOWN OVER 700 POINTS. PEOPLE GOT A WAKE-UP CALL THAT THIS HAS TO BE CURTAILED A BIT. >>LET ME ASK YOU, IS THIS CHINA BLINKING? ARE THEY ACTING LIKE A GROWN- UP? IT DOESN’T MATTER EITHER WAY? >>I’M SURE MATTERS. I’M SURE DONALD TRUMP WILL CONTEND THEY HAVE BLINKED. IT’S TOO EARLY TO MAKE THAT CALL. EVEN THE CHINESE WORRY ABOUT THE IMPACT ON THEIR ECONOMY AND THE IMPACT ON THEIR MARKETS. I DO SEE A BIT OF A TRUCE. THERE ARE SO MANY DETAILS THAT WE HAVE TO IRON OUT. >>THIS IS SOMETHING THAT GOT MISSED. THEY ANNOUNCE THE TRADE DEAL WITH JAPAN. PREVIOUSLY, WE HAD THE TRADE DEAL WITH MEXICO AND CANADA. BOTH OF THOSE SEEMED LIKE THEY WERE BIG NOTHING AFTER A LOT OF SOUND AND FURY. WILL WE GET ANY KIND OF MEANINGFUL TRADE DEAL WITH CHINA? WILL IT BE A LOT OF PAIN FOR NOT A LOT OF RESULTS AT THE END?>>YOU MAKE A VERY GOOD POINT. WE DON’T HAVE A DEAL WITH FRANCE OR WESTERN EUROPE. THE CANADA AND MEXICO DEAL MAY GET CONFIRMED BY CONGRESS IN THE NEXT MONTH. THAT IS NOT DONE EITHER. YOU HAVE TO SAY, A LOT OF THESE THINGS ARE HAPPY TALK. LET ME MAKE THIS OTHER POINT. THERE IS STILL REALLY BIG IMPEDIMENTS WITH GETTING A DEAL WITH CHINA. THE FIRST IS, THERE ARE MANY HAWKS IN THIS TOWN, NOT JUST PETER NAVARRO. YOU HAVE DEMOCRATS LIKE CHUCK SCHUMER, WANTING TO CRACKDOWN ON CHINA. MANY DEMOCRATS WANT TO BE AGGRESSIVE AS WELL. MORE IMPORTANTLY, IS THE THREAT THAT CHINA MAY TRY TO CRUSH THE INSURRECTION IN HONG KONG. IF THEY DO, MAKES GETTING A DEAL A LOT TOUGHER. >>WENT 70 ON EARLIER IN THE WEEK THAT SUGGESTED THAT NAVARRO COULD BE A HOLDOVER TO A DEMOCRATIC ADMINISTRATION, IF ONE OF THEM WIN. HOW LIKELY WOULD THAT BE THAT WE COULD SEE THIS LEVEL OF THIS IN CHINA OVER THE NEXT ADMINISTRATION? >>I HAD NOT HEARD THAT. BERNIE SANDERS AND ELIZABETH WARREN, PROUDLY AGREE WITH NAVARRO ON A LOT OF ISSUES. HE IS VERY PRICKLY. HE IS DIFFICULT TO DEAL WITH. I THINK OF A PRESIDENT IS A DEMOCRAT, THEY MAY TRY TO GET SOMEONE NEW. THERE IS NOT A LOT OF DIFFERENCE BETWEEN BARRY SANDERS, ELIZABETH WARREN, AND THE WHITE HOUSE ON MANY OF THE TRADE ISSUES. >>AS AN ANALYST, AND SOMEONE WHO GOES TO COCKTAIL PARTIES AND WASHINGTON, D.C., PEOPLE SAY, HAD WE DO WITH THIS THING? HOW DO YOU PLAY THIS TRADE WAR, THAT LOOKS LIKE IT WILL GO ON FOR A WHILE IF YOU ARE AN INVESTOR? >>I HATE TO THROW OUT ANOTHER CLICHC BUT I DO FEEL THAT FIXED INCOME, GOING TO SAFETY, THE SAFE HAVENS MAKE SENSE UNTIL WE GET A DEAL. WE HAVE A LOT OF OTHER THINGS TO WORRY ABOUT, NOT JUST HONG KONG. WE HAD TO WORRY ABOUT BREXIT. WE HAVE TO WORRY ABOUT THE THINKING ECONOMIES IN WESTERN EUROPE. UNLESS THERE IS A FIRM, SIGNED A DEAL, I THINK THE PLAY CONTINUES TO BE FIXED INCOME. >>WHEN YOU GO TO THE COCKTAIL PARTIES, IS THAT THE TRADE CONVERSATION? WHEN YOU GO TO ACTUAL MEETINGS AS WELL, IS IT THE TRADE CONVERSATION THAT IS STILL DOMINATING AT THIS POINT? >>THE QUESTION YOU GET MORE THAN ANYTHING ELSE, RIGHT NOW IS, WHAT HAPPENS TO THE DEMOCRATS OF JOE BIDEN DOES FADE? IF HE SLIPS BADLY, HE WAS THE REPLACEMENT? HE WILL TAKE OVER AS A FRONT RUNNER IF HE FADES. I DON’T HEAR A LOT ABOUT THIS. THE CONSENSUS IN THIS TOWN IS THAT WE HAVE A WAYS TO GO. DONALD TRUMP WILL PULL OUT ALL OF THE STOPS TO GET REELECTED. BY WINTER, WE WILL GET A DEAL. WE HAVE A FEW MONTHS TO GO. LET’S TAKE A FINAL LOOK AT WHERE THE MARKET SETTLED ON THIS THURSDAY. IT WAS AN EVENTFUL THURSDAY. IT WAS A POSITIVE THURSDAY. WE HAD ONE MORE TRADING DAY IN AUGUST. THE OUTSIDE CHANCE THAT WE COULD SEE THE MARKET GET BACK TO RAKE EVEN FOR THE MONTH? WE’LL KEEP AN EYE ON THAT. THE OFFICIAL END OF SUMMER THIS WEEKEND. WE ARE BACK IN ACTION NEXT WEEK. SCHOOL STARTS AND EVERYONE IS HERE. >>GRAB YOUR WHITE CLOTH. >>HAVE FUN THIS WEEKEND. WE WILL BE WATCHING ULTA WITH THEIR STOCK TANKING IN AFTER- HOURS. THAT IS ALL FROM NEW YORK, I AM JEN ROGERS, AND THIS IS A “THE FINAL ROUND” ON YAHOO FINANCE. TURN INTO INFLUENCERS. TONIGHT JUST AS THE BETA WORKS FOUNDER AND CEO, AND THAT IS COMING UP IN JUST TWO MINUTES.

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