Yahoo Finance LIVE market coverage: Tuesday, August 20, 2019

Yahoo Finance LIVE market coverage: Tuesday, August 20, 2019


. >>>GOOD MORNING WELCOME TO ALL OF YOU WATCHING. >>>ALEXIS CHRISTOPHERSON. >>>PEOPLE ARE IN ECONOMIC JOLT AS THE WHITE HOUSE PUSHES BACK ON REPORTS FINDING NEW WAYS TO STIMULATE THE ECONOMY COULD A PAYROLL TAX CUT BE IN THE CARDS? >>LIVE OR DIE MOMENT, THE FOUNDER DISMISSES THE LATEST MOVES TO BAN HIS COMPANY FROM DOING BUSINESS WITH THE U.S., WHY HE SAYS AMERICAN SHIP MAKERS WILL BE HURT FAR MORE. >>>LUMBERING ON HOME DEPOT REPORTS, THANKS TO LUMBER PRICES. >>>LET’S GET A QUICK CHECK OF THESE MARKETS, DOWN DROPPED OFF THE CLIFF AROUND 4 A.M., HAVE COME BACK A LITTLE BIT, UP SLIGHTLY THE S&P 500 IS TEETERING BETWEEN GAINS AND LOSSES. >>>WE’LL GET A FULL CHECK OF THE MARKET IN JUST A MINUTE. FIRST, TODAY’S BIG STORY. >>>PRESIDENT TRUMP CONTINUES T SAY THE U.S. ECONOMY IS QUOTE DOING TREMENDOUSLY, IN PRIVATE, HIS ECONOMIC ADVISERS ARE REPORTEDLY PREPARING OPTIONS TO HELP PREVENT THE ECONOMY FROM FALLING INTO RECESSION, POSSIBLE OPTIONS INCLUDE A CUT TO THE PAYROLL TAX, ROLLING BACK SOME TARIFF’S, YAHOO FINANCE, WE WERE TALKING ABOUT A WASHINGTON POST STORY THAT SAYS HIS ADMINISTRATION WASN’T PREPARING FOR A DOWNTURN CERTAINLY A MIXED MESSAGE. >>CERTAINLY WHAT, WHAT THE FAKE NEWS, SEEMS TO BE RECESSIONS SEEMS TO BE INCREASING. LOOK, WE ARE NOT IN A RECESSION, I THINK THAT’S IMPORTANT FOR EVERYBODY TO REALIZE, PRESIDENT TRUMP CLEARLY REALIZES HIS REELECTION ODDS DEPEND UPON A STRONG ECONOMY, NOT JUST AN ECONOMY LIMPING ALONG, HE IS THINKING ABOUT WAYS TO JUICE THE ECONOMY GOING INTO 2020. >>>WHAT’S THE PROBABILITY OF A PAYROLL TAX CUT, THIS HAPPENS WHEN THEY ARE DIRE STRAIGHTS. >>PRESIDENT OBAMA DID THIS IN 2011, 2012, THAT WAS A BIPARTISAN LEGISLATION HE MEANT TO GET THROUGH CONGRESS, THERE WERE OTHER TAX MEASURES, IT WAS A TWO-YEAR TAX REPRIEVE, IT LOWERED THE PAYROLL TAX FROM 6.2% TAKEN OUT OF YOUR PAYCHECK TO 4.2. CAME DOWN 2% POINTS, THAT PUT AROUND A THOUSAND DOLLARS ON AVERAGE IN PEOPLE’S POCKETS. IT HAPPENED BEFORE. I THINK THE PROBLEM IS HERE THAT DEMOCRATS LED MY NANCY PELOSI, THE HOUSE OF REPRESENTATIVES, ARE GOING TO BE VERY CLEVER ABOUT DENYING TRUMP SOMETHING THAT MIGHT HELP HIM GET RE-ELECTED. I CAN SEE, HEY, GOOD FOR US, BUT WE WOULD LIKE TO RESCIND TAX CUTS FOR THE WEALTHY. >>ONE IS CUTTING CAPITAL GAINS TAX. >>THAT SEEMS LIKE A POLITICAL LOSER TO ME, THAT DOES NOT HELP THE MIDDLE CLASS, THAT HELPS WEALTHIER TAXPAYERS, THAT’S APPARENTLY A LARRY CUDLOW. IF, WE LOVE THIS IDEA, WE WANT THESE AS PART OF THE DEAL, RESCIND THE TAX CUTS, CUTS FOR THE WEALTHY, OR RAISE THE CUT ON STATE AND LOCAL TAX, OR SOMETHING ELSE. I THINK NANCY PELOSI IS VERY IN DEPTH, I THINK SHE IS GOING TO BE VERY SHREWD IF THIS EVEN GETS TO THE POINT OF A PROPOSAL THAT GOES TO CONGRESS. >>WHEN WE GET THIS PHYSICAL POLICY, SAY GOODBYE TO THOSE RATE CUTS. >>WELL, IT CERTAINLY COMPLICATES FOR THE FEDERAL RESERVE, THE FED IS GOING TO BASE RATE CUTS WHAT IT SEES IN THE PRESENT. NOT SAY, OH, WE MIGHT HAVE A TAX CUT AND THEREFORE MAKE CUTS THIS YEAR, I DON’T THINK THIS WILL CHANGE THE CALCULUS FOR THE FED IN THE SHORT TERM. IF IT ACTUALLY HAPPENS THEN IT COULD. >>>TRUMP TWEETED YESTERDAY THE FED SHOULD CUT RATES BY AT LEAST ONE PERCENTAGE POINT WITH PERHAPS SOME QUANTITATIVE EASING AS WELL. >>EMERGENCY MEASURES, EVEN THOUGH THE ECONOMY IS DOING TREMENDOUSLY. >>THANKS, GUYS. >>>AS THE WHITE HOUSE WORKS TO DETER RECESSION, IT IS ALSO TRADE WAR AGAINST CHINA. WHILE THEY REMAIN A FOCAL POINT, THE FOUNDER SAID TO THE ASSOCIATE PRESS THAT ISN’T WORRIED ABOUT ANY RESTRICTIONS. >>>IF THERE IS NO AMERICA, WEB CAN STILL CONTINUE PRODUCTION AND PRODUCE EVEN BETTER. IT WON’T AFFECTS US AT ALL. ON THE OTHER HAND, IT WILL AFFECT OUR AMERICAN FRIENDS BECAUSE THAT THEY’VE BEEN SUPPLYING MILLIONS OF DOLLARS IN PRODUCT, THEIR BUSINESS IN A SHORT AMOUNT OF TIME WILL BE GREATLY AFFECTED. >>>THIS IS QUITE THE TOUGH TALK FROM HIM. >>WELL, IF YOU ARE A SHAREHOLDER OF QUALCOMM, AS WE TALKED ABOUT JUST THE OTHER DAY, YOU GUYS, THESE COMPANIES DO BID WITH WITH WALWAY. I NOTICE THAT INTEL IS DOWN IN THE PREMARKET. >>DO YOU THINK THAT, DOES THIS SHOW THE FACT THAT TRUMP SORT OF KEEPS STEPPING BACK LITTLE BY LITTLE. DOES IT SHOW THAT WE ARE LOSING THE TRADE WAR. >>I THINK IT SUGGESTS WE’RE NOT IN A POSITION OF STRENGTH, WE’VE SEEN THE PRESIDENT STEP BACK HERE, ALSO WITH THE TARIFFS, I THINK THE CHINESE ARE LOOKING AT THAT SAY WE WE STAND A PATH THE U.S. WILL KEEP RETREATING, EVERYONE IS LOOKING AT THAT PRESIDENTIAL ELECTION COMING UP BOTH THE UNITED STATES AND THE CHINESE. BANKING, PERHAPS, BETTING ON MAYBE A DEMOCRAT WINNING THE WHOLE THING CHANGES FINANCIALLY. >>>IF I’M TALKING ABOUT WALWAY. >>IT IS HARD TO SAY, BRIAN, THEY COULD BE DOING CONTRACT WORK AND SETTING UP SAY FOR INSTANCE CHIP FABS THEMSELVES IN CHINA OR OTHER COUNTRIES TO MAKE UP FOR THE CHIPS THEY ARE NOT GOING TO BE ABLE TO GET FROM U.S. COMPANIES. REMEMBER, I KEEP TELLING PEOPLE THAT THE CHINESE ARE NOT JUST SITTING THERE ON THEIR HANDS, THEY ARE ANTICIPATING THIS IS GOING TO GO ON FOR A LONG TIME. EVEN IF IT IS RESOLVED, WE’RE NEVER GOING TO BE THE SAME. WE’RE NEVER GOING BACK TO THE DAYS OF GLOBALISM BEFORE PRESIDENT TRUMP WAS ELECTED. EVERYBODY IS TALKING ABOUT CONTINGENCY PLANS, APPLE WORKING ON SUPPLY CHAIN AND NOT RELYING ON CHINA THE WAY THEY USED TO. I THINK NO ONE IS GOING TO GO BACK TO THOSE GLORY DAYS. >>>SOME OF THE COUNTRY’S BIGGEST NAMES IN TECH ARE FACING FRESH SCRUTINY THIS MORNING. A GROUP OF STATE ATTORNEYS GENERAL REPORTEDLY LOOKING TO LAUNCH THEIR OWN INVESTIGATION INTO FACEBOOK, GOOGLE, AMAZON, AND APPLE. YAHOO FINANCE TECH EDITOR DAN HOWLEY IS IN THE NEWSROOM, WHAT ARE THESE GUYS LOOKING AT. >>THERE IS THIS REPORT COMING OUT, BASICALLY STATE ATTORNEY GENERALS FROM VARIOUS STATES INCLUDING NEW YORK, úMISSISSIPP BIPARTISAN COMMITTEE LOOKING AT ANTI-COMPETITIVE PRACTICES ON THE PART OF THOSE FOUR TECH GIANTS. ESSENTIALLY LOOKING AT WHETHER OR NOT THEY ARE USING THEIR LARGE POWER TO PUSH OUT COMPETITION OR BOX THEM OUT, PURCHASE THEM UP, AND DO ANY KIND OF BUSINESS PRACTICES THAT MIGHT BE SEEN AT MA NOTARY MANOPOLISTIC. >>>IT SEEMS THIS SITUATION IS GETTING WORSE. >>THEY ARE ALREADY BEING LOOKED AT BY THE DEPARTMENT OF JUSTICE, THEN THEY ARE ALSO BEING LOOKED AT BY THE FTC SO THERE IS THREE DIFFERENT CONCURRENT, YOU WOULD ASSUME, INVESTIGATIONS GOING ON, INTO WHETHER OR NOT THESE GIANT COMPANIES ARE, IN DEED, USING MONOPOLY POWER TO COMMIT PRACTICES. THERE IS A LOT OF DISCUSSION WHETHER OR NOT THEY’LL BE EVENTUALLY BROKEN UP. THAT’S BEEN BROUGHT UP WE THE HEAD OF THE FTC, RELEASING A STATEMENT, BREAKING UP A COMPANY LIKE FACEBOOK, FOR INSTANCE, WOULD PROVE INCREDIBLY DIFFICULT BECAUSE FACEBOOK IS TRYING TO INTEGRATE THEIR BACK END, THAT WOULD BE FACEBOOK, INSTAGRAM, WHAT’S APP, IT SEEMS LIKE MAYBE THEY KNEW SOMETHING LIKE THIS WAS HAPPENING AND WANTED TO CATCH THE GOVERNMENT OFF GUARD AND COMBINE THEM TO MAKE THEM FOR DIFFICULT TO BREAK UP. THE ONLY OTHER BIG COMPANY TOLD TO BREAK UP WAS MICROSOFT, THAT WAS APPEALED SO THEY DIDN’T HAVE TO BREAK UP. IF SOMETHING ALONG THOSE LINES DID HAPPEN, IT WOULD BE ALMOST UNPRECEDENTED IN THE MODERN- TECH AGE. >>WE KNOW IT CAN TAKE YEARS AND YEARS TO GET CAUGHT UP IN THE COURT. UNRELATED, I WANTED TO ASK ABOUT TWITTER AND FACEBOOK WITH CHINA SPREADING MISINFORMATION IN HONG KONG WHERE PROTESTS CONTINUE TO GO ON, WHAT ARE THEY DOING ABOUT IT? >>FACEBOOK AND TWITTER HAS TAKEN DOWN A NUMBER OF ACCOUNTS, TRACED THEM BACK TO WHAT APPEARS TO BE THE PEOPLE’S LIBERATION ARMY OVER CHINESE STATE RUN ENTITIES AND IT WAS INTERESTING, THEY WERE TALKING WITH OUR OWN REPORTER YESTERDAY, HE’D MADE THE POINT THIS ISN’T SOMETHING CHINA USUALLY DOES, THEY ARE USUALLY ON THE BACK END OF THINGS, THEY DON’T WANT TO BE KNOWN WHAT THEY ARE DOING AS FAR AS CYBER ATTACK GOES, THIS IS SOMETHING CLEAR OUT IN THE OPEN, IT WAS TRACED BACK TO THE STATE-RUN ENTITY. THIS IS A GAME CHANGER FOR THEM. >>ALL RIGHT THANKS, DAN. >>>ANOTHER BIG EARNINGS FOR RETAIL, LET’S SEE WHAT IS DOWN IN THE PREMARKET AT THE NEW YORK STOCK EXCHANGE, INEZ ? >>Reporter: BRIAN, WE’RE LOOKING AT HOME DEPOT AFTER REPORTING THEIR EARNINGS, CAME IN ABOVE ESTIMATES ON ADJUSTED EARNINGS THE COMPANY LOWERED ITS FULL NEW REVENUE OF GUIDANCE BECAUSE OF LUMBER PRICE DEFLATION, ALSO THE POTENTIAL IMPACT OF TARIFFS ON THE U.S. CONSUMER WHEN IT COMES TO THEIR GUIDANCE, REAFFIRM THEIR PROFIT GUIDANCE, WE’RE WATCHING KOHLS, SALES CAME IN, SALES WERE DOWN 2.9%, LARGER úT HIGHLIGHT THAT THE LAST SIX WEEKS FOR THEM IN THE QUARTER WAS STRONG, SO FAR THEY’VE HAD A SUCCESSFUL BACK TO SCHOOL SEASON, ALSO THEY ARE VERY BOLD ON INCREASE TRAFFIC IN THEIR STORES BECAUSE OF THAT AMAZON RETURN PROGRAM THAT THEY HAVE NOW. AND MED TRONNIC, ALSO RAISED THEIR PULL YEAR PROFIT OF 4% IN PREMARKET. BRIAN, ALEXIS. >>>OKAY. >>>TIME TO SEE WHAT’S MOVING THE EUROPEAN MARKETS, DOWN ACROSS THE BOARD, OFF 15. THE CAP 40 IN PARIS, GERMANY, DOWN 24 POINTS. OSCAR, UK MINISTER BORIS JOHNSON WRITTEN TO THE EU SETTING OUT PLANS FOR BRIXIT, WE HAVE THE POUND FALLING AS A RESULT. >>Reporter: REPEATING THE LINE HE CONSISTENTLY SAID ON BREXIT YOU MUST REMOVE THE IRISH BACKSTOP, THIS IS PART THAT STOPS THE HARD BORDER BETWEEN ISLAND. IT DOES THAT BY KEEPING IRELAND WITHIN THE CUSTOM UNION, BRITAIN, AND BORIS SAYS THIS IS UNDEMOCRAT. HE WANTS THE EU TO COME UP WITH MORE FLEXIBLE AND CREATIVE ARRANGEMENTS, THAT’S WHAT HE SAID, IN THE LETTER. HE CALLED FOR THEM TO COME UP WITH THESE ALTERNATIVE ARRANGEMENTS. THE LETTER ONLY WENT OUT LAST NIGHT TO EUROPEAN COUNCIL, PRESIDENT DONALD TUSK, BUT ALREADY ROUNDLY REJECTED. TUSK SAID THAT ACTUALLY, BORIS WAS THE ONE MAKING, ASKING FOR ALTERNATIVE ARRANGEMENTS WITHOUT PROPOSING ANY. NOW, THE FACT THAT THESE TWO SIDES ARE STILL AT LOGGER HEADS WITH AROUND 70 DAYS TO GO UNTIL THE BREXIT DEADLINE IS WHAT’S PUTTING THE POUND UNDER PRESSURE, .2% WITH THE EURO AND DOLLAR. >>>RON FEARS ABOUT THE IMPACT BRIXIT COULD HAVE ON UK SUPERMARKETS, RIGHT. >>Reporter: IT IS PRETTY INCREDIBLE, STOCKBROKER WARNING IN A NOTE, WE COULD SEE RASHENING IN SUPERMARKETS IF THERE IS A NO-DEAL BREXIT, THAT SUPERMARKETS MAY BE FORCED TO WITHHOLD STOCK WHILE SHELVES ARE BEING WIPED CLEAN. STRESS THAT IS A BLACK SWAN SCENARIO, THEY HOPE IT DOESN’T COME TO PASS, THEY SY IT IS KIND OF RIDICULOUS TO BE WRITING THIS ABOUT A SUPPOSEDLY ADVANCED STATE, THEY HOPE THEY’LL BE EMBARRASSED WHEN THEY LOOK BACK IN A FEW MONTHS AT THIS PREDICTION, STILL, WORRYING NONE THE LESS. >>>LET’S TAKE A LOOK AT TODAY’S NEWS BITE. >>DISGRACE FINANCIER WROTE A WILL TWO DAYS BEFORE HE TOOK HIS OWN LIFE, TRANSFERRED ALL ASSETS TO A TRUST, SHOWING EPSTEIN HAD HALF A MILLION DOLLARS IN ASSETS. >>>ISIS IS REGAINING STRENGTH IN IRAQ AND SYRIA, MILITARY AND INTELLIGENCE OFFICIALS TELL THE NEW YORK TIMES THAT THE TERROR GROUP IS LAUNCHING GORILLA ATTACKS AFTER FORCES PUSHED OUT OF SYRIA. >>>CONSTRUCTION PICKED UP AT THE NOTRE DAME CATHEDRAL IN PARIS, AFTER A MONTH LONG DELAY OF FEARS OF LED CONTAMINATION WHICH IS LED TO THE FIRE IN APRIL. CLEAN UP TEAMS GATHERED TO SWEEP, SPRAY THE CATHEDRAL TO SPRAY ANY LEFT OVER LED, CRITICS AND ENVIRONMENTAL GROUPS ARE ACCUSING THE AUTHORITIES OF MINIMIZING THE RISK TO CLEAN UPWORKERS IN NEAR BY SCHOOLS AND NEIGHBORS. >>>STARTING TODAY, PEOPLE FLYING IN AND OUT OF THE SAN FRANCISCO INTERNATIONAL AIRPORT WILL NOT BE ABLE TO BUY SINGLE- USE PLASTIC WATER BOTTLES. THE RULE APPLIES TO RESTAURANTS, CAFES AND VENDING MACHINES IN THE AIRPORT, PASSENGERS WHO NEED WATER WILL HAVE TO BRING THEIR OWN REFILLABLE WATER BOTTLES IF THEY DON’T WANT TO BUY ONE AT THE AIRPORT. >>>COMING UP HERE ON THE FIRST TRADE, TRYING TO FIND A RECESSION FROM THE RV MARKET, WHAT RECREATIONAL VEHICLE SALES THE HEALTH OF OUR ECONOMY. >>>ALSO IN HOME DEPOT IS SEEING PRESSURE THIS MORNING AFTER IT CUT ITS GUIDANCE, HOW THE TRADE WAR MAY IMPACT THE HOME IMPROVEMENT AND THE PRICE OF LUMBER. >>>MIXED ACTION DOW FUTURE SWING BETWEEN GAINS AND LOSSES, DITTO FOR THE S&P 500 AND THE NASDAQ, WE’LL BE RIGHT BACK. . >>>STOCK FUTURES FELL OFF A CLIFF LIKE SAYING ALL MORNING LONG, NOW SLIGHTLY IN THE RED, DOW DOWN 500 AND S&P 500 HAVE NOW TURNED NEGATIVE. >>>FORGET THE BOND MARKET, SOME ARE LOOKING FOR THE RV MARKET FOR SIGNS OF AN IMPENDING RECESSIONS SHIPMENTS OF RECREATIONAL VEHICLES ARE DOWN 20% SO FAR THIS YEAR ACCORDING TO THE RV INDUSTRY ASSOCIATION, SO JUST WHAT DOES THAT TELL US ABOUT THE ECONOMY? JOINING US NOW FROM BLOOMINGTON IS KYLE ANDERSON, ECONOMIST WITH THE INDIANA UNIVERSITY KELLY SCHOOL OF BUSINESS, IT IS GOOD TO HAVE YOU ON THE SHOW WHY ARE SALES OF RV CONSIDERED A BELL WEATHER OF ECONOMIC HEALTH. >>SO, IF YOU THINK ABOUT IT, RV SALES ARE KIND OF A LUXURY GOOD, PEOPLE WANT TO FEEL GOOD ABOUT THE ECONOMY IF THEY ARE GOING TO MAKE A LARGE PURCHASE LIKE THIS. YOU DON’T HAVE TO BUY AN RV, IT IS AN OPTIONAL PURPOSE, WE’VE SEEN IN THE PAST WHEN RV SALES HAVE SLOWED DOWN, IT IS A SIGN THE ECONOMY IS SLOWING DOWN. >>JUST TO PUSH BACK ON THIS NOTION, I WENT ON THE EARNINGS CALL, SAID SALES OF THEIR BOAT SALES ARE ALSO UNDER PRESSURE, MANY PEOPLE DON’T WANT A GIANT RV IN THEIR PARKING LOT MAYBE THEY JUST WANT TO TAKE A CRUISE THAT CERTAINLY IS ONE POSSIBILITY BUT AGAIN HISTORICALLY, 2007, WELL BEFORE THE BIG FINANCIAL CRISIS, RV SALES DROPPED OFF AGAIN IN 2000 BEFORE 2001. YEAH IT MAY BE PREFERENCES BUT A LOT OF IT IS ALSO, YOU KNOW, DEMONSTRATED TO BE AN INDICATER IN THE PAST OF AN ECONOMIC SLOW DOWN. >>PROFESSOR THE RV, MENTIONS STEEL AND ALUMINUM PRICING ON THESE RECREATIONAL VEHICLES, DO YOU THINK THE SOFT DEMAND IS JUST BECAUSE PRICES ARE TOO HIGH AND NOTHING MORE THAN THAT? THAT IS CERTAINLY ONE POSSIBILITY, ONE THING WE WANT TO KEEP IN MIND, PRICES ARE UP 8.5, 9% OVER LAST YEAR, A LOT DUE TO THE TARIFFS SO THAT IS CERTAINLY A FACTOR BUT THE MAGNITUDE WE’RE SEEING INDICATES SOMETHING MORE THAN THAT. >>YOU MENTIONED ECONOMIC SLOW DOWN, DO YOU THINK THE PRESSURE RV SALES REFLECT RECESSION ON THE WAY. >>IT IS HARD TO SAY WHETHER IT IS A SLOW DOWN OR A FULL-ON RECESSION, I DON’T THINK OUR INDICATORS ARE THAT GOOD TO BE ABLE TO TELL WHICH ONE IT IS BUT, YOU KNOW, I THINK THIS DATA ARE THERE, COUPLED WITH OTHER DATA CERTAINLY INDICATES THAT A RECESSION IS A STRONG POSSIBILITY I KNOW A LOT OF THE MANUFACTURING FOR THESE RVS TAKES PLACE IN ELKHEART INDIANA, WHAT ARE CONDITIONS THERE LIKE, ARE THERE COMPANIES LAYING OFF, FEWER SHIFTS, WHAT’S THE SITUATION. >>YES, THEY ARE CUTTING BACK ON HOURS, STARTING TO DO SOME TARGETED LAY OFFS. SO THEY ARE DEFINITELY PREPARING FOR A SLOW DOWN, A LOT OF THE COMPANIES ARE SAYING, WELL, INVENTORIES JUST GOT BUILT UP A LITTLE BIT, THEY ARE GOING TO PULL BACK, BUT, YOU KNOW, WE’RE GOING TO BE OKAY GOING FORWARD AND WE EXPECT SALES TO BE UP, BUT, THE DATA ARE TELLING A DIFFERENT STORY. >>>TO WHAT EXTENT IS THE TRADE WAR IMPACTING THE RV MAKERS? LOOK AT STEEL PRICES, FOR EXAMPLE. >>Reporter: SO, STEEL PRICES HAVE ALREADY DRIVEN UP THE COST OF RVS, THAT’S CERTAINLY A FACTOR AND THE IMPENDING TARIFFS WITH CHINA WOULD IMPACT RVS IN A LOT OF WAYS. I MEAN, IF YOU THINK ABOUT A RECREATIONAL VEHICLE, THERE ARE A LOT OF DIFFERENT COMPONENTS IN IT. OBVIOUSLY STEEL AND ALUMINUM ARE BIG PARTS, THE INTERIOR HAS A WHOLE LOT OF FACTORS AND ELEMENTS, A LOT OF THEM ARE IMPORTED. >>DO YOU THINK PRICES CAN SPIKE IF THOSE TARIFFS GO INTO EFFECT? >>I CERTAINLY THINK THEY’LL GO UP, WHETHER THEY SPIKE OR CONTINUE TO RISE, AGAIN, THESE ARE QUOTE UNQUOTE, LUXURY GOODS IN A SENSE THAT CONSUMERS DON’T REALLY NEED THEM BUT THEY ARE ALSO PURCHASED BY MIDDLE AMERICA, RIGHT? THESE ARE THE SUPER WEALTHY BUYING RVS, IN SOME CASES THEY MIGHT BE, BUT IT IS A GOOD INDICATER BECAUSE IT IS MIDDLE INCOME FOLKS WHO ARE MAKING THESE DECISIONS, THEY ARE GOING TO BE SENSITIVE TO PRICE. >>>ALL RIGHT, WE’RE GOING TO LEAVE IT THERE, PROFESSOR KYLE ANDERSON, THANKS FOR THE UPDATE. >>THANK YOU. >>>COMING UP AT THE TOP OF THE HOUR ON YAHOOFINANCE.COM, WEIGHING IN ON REAL ESTATE, WHAT LOWER INTEREST RATES WILL MEAN FOR THE HOUSING MARKET, WE’LL BREAK DOWN THE RESEARCH WITH EXPERT BESS FRIEDMAN. >>>THE ART OF THE EXIT, IT IS A TRUE CRIME PODCAST THAT MAKES YOU INSIDE THE WORLD OF THE MOST NOR HEIST. THE FIRSTYOU CAN LISTEN TO THE ART OF THE EXIT ON APPLE PODCAST OR WHEREVER YOU GET YOUR PODCAST. >>>WE’LL GET THAT TRADING DAY ON OUR WAY COMING UP NEXT, LET’S LOOK AT THE FUTURES, TURNED INCREASINGLY NEGATIVE, THEY HAD BEEN MIXED ALL MORNING LONG, S&P 500, SOLIDLY IN THE RED, HERE IS ACTION IN OVERSEAS MARKETS. . >>>WELCOME BACK TO THE FIRST TRADE, WE’RE ABOUT FIVE MINUTES AWAY FROM THE OPENING BELL, STOCK FUTURES S&P FUTURES DOWN 5.5, THE NASDAQ OFF 16. LET’S GO AROUND THE BELL WITH SHAWN GIBSON, CHIEF INVESTMENT OFFICER AT LIQUID STRATEGIES HE IS IN ATLANTA THIS MORNING, YAHOO FINANCES IS JOINING US AT THE WI-FI INTERACTIVE BOARD, SHAWN, I WANT TO BEGIN WITH YOU, THANKS FOR JOINING US THIS MORNING. IT LOOKS LIKE STOCKS ARE, INVESTORS ARE JUST SORT OF HANGING OUT ON THE SIDELINES, WHAT DO YOU THINK THE NEXT BIG CATALYST FOR THIS MARKET IS GOING TO BE. >>Reporter: WELL, I THINK WE’RE AT A BIG INFLECTION POINT IN THE MARKET, WE HAD A BIG RALLY OVER THE LAST FEW DAYS, OBVIOUSLY, HITTING SOME I THINK PRETTY IMPORTANT RESISTANCE HERE. I THINK THE REST OF THIS WEEK IS GOING TO BE CRITICAL. I THINK INVESTORS ARE FOCUSED ON MINUTES COMING OUT TOMORROW AFTERNOON, THEN ALSO LOOKING AT FRIDAY, THINK IS GOING TO BE REALLY BIG, PAL SPEECH IN JACKSON HALL. >>THIS TALK THAT WE STARTED RECENTLY REGARDING FISCAL STIMULOUS, THAT IT DOES SEND A MESSAGE AS THE INVERTED YIELD CURVE THAT IS WHAT HAS PEOPLE ON EDGE, WHAT THAT INVERTED YIELD CURVE SIGNALS ON ONE HAND YOU COULD THINK, LOWER LONGER TERM INTEREST RATES ARE POSITIVE FOR EQUITIES IN SOME WAYS, THE INVERSION HAS PEOPLE ON THE EDGE OF THEIR SEATS. >>FROM ALL THE PEOPLE YOU TRACK AND STUDY, DO YOU THINK WE NEED FISCAL STIMULOUS HERE? >>THE MARKET THINKS WE DO BASED UPON THE FACT WE’RE FULLY PRICED FOR THE REST OF THE YEAR, POSSIBLY EVEN AS MUCH AS 75. THE MARKET SEEMS TO THINK WE CERTAINLY DO. >>>LOOKING AT THE S&P 500, UNCHANGED A LITTLE WHILE AGO THIS IS A TWO-DAY CHART THIS IS THE OPEN YESTERDAY IN THE ELECTRONIC MARKET AT 6 P.M. EASTERN WE CAN SEE THAT WE TESTED THE HIGHS FROM YESTERDAY OVERNIGHT, WE JUST KIND OF WENT INTO THE EUROPEAN OPEN, TESTING THE LOWS CREATED ABOUT 8 P.M. OR SO LAST NIGHT. I WANT TO TAKE A LONGER TERM LOOK AT THE S&P 500, WE’RE GOING TO GO TO A CANDLESTICK CHART OF TWO MONTHS. THIS IS GOING TO GIVE US OF WHAT’S HAPPENING RECENTLY. WE HAVE WHAT’S TRACING OUT BASICALLY A W-BOTTOM, HAVEN’T CONFIRMED IT YET, I AGREE WITH SHAWN, WE’RE AT AN INFLECTION POINT, WE’RE AT THIS RESISTANCE LEVEL, 2950, MOVING AVERAGES ABOVE. IF WE CAN CLOSE ABOVE THAT, WE COULD SEE A RETURN TO THE HIGHS HERE. IF WE FAIL, PROBABLY GOING TO TEST THESE LOWS AROUND 28, 20, 2825, MAYBE LOWER, I COULD CAP THE DAMAGE THAT COULD BE DONE THIS MONTH, MAYBE AT 10%. JP MORGAN MARCO COLONAVICH, IF YIELDS HAVE COME DOWN SO MUCH, GOING TO THE END OF THE MONTH, THERE TENDS TO BE A BALANCING TO CATCH UP AND BY EQUITIES IN THAT. IF EQUITIES DO GO DOWN THAT WOULD SOFTEN THE END OF THE LINE HEADING INTO NEXT MONTH, THAT’S THIS WEEK NOT NEXT WEEK. >>>COMMODITIES ARE AT THE TOP OF MY MIND FOR HOME DEPOT, WHAT ARE YOU SEEING THIS COPPER. >>WE CAN LOOK AT COPPER HERE AS WELL. I’M LOOKING AT THE U.S. DOLLAR FIRST, WE’RE SEEING THIS, I BELIEVE THIS IS A 6 DAY OF GAINS HERE MARCHING TOWARDS ITS TWO-YEAR HIGH, THAT’S WEIGHING ON ALL FUTURE. COPPER, THESE ARE LOWS IN AUGUST, THE DEMAND NOT LOOKING GOOD, CHINA DID HAD SOME OUTSIDE PURCHASES OF COPPER BUT THAT WAS JUST FRONT-RUNNING I THINK A LOT OF THE TARIFF STUFF, DR. COBB WRITES NOT MUCH HERE NOT SAYING MUCH ABOUT THE MARKET, BUYING IN THE STRENGTH OF EQUITIES THE LAST FEW DAYS. >>>HERE WE HAVE THE OPENING BELL ON THIS TUESDAY MORNING, THE NEW YORK STOCK EXCHANGE AND NASDAQ GETTING READY FOR A FRESH DAY OF TRADING WE SAW FUTURES START TO SELL OFF A LITTLE BIT MORE CLOSER TO THE TRADING DAY, LOOKS LIKE THE DOW IS GOING TO START THE DAY DOWN ABOUT 17 POINTS. I KNOW YOU’VE BEEN LOOKING CLOSELY AT THE SO-CALLED FEAR INDEX, DRAW US THE CONCLUSION IF VOLATILITY CONTINUES TO SAY HIGH, IS THERE A CORRELATION BETWEEN THAT AND RECESSION? >>Reporter: YEAH, EVERY RECESSION WE’VE HAD SINCE GOING BACK ALL IT WILL WAY TO THE EARLY ’90S HAS BEEN PRECEDED BY A PRETTY SUBSTANTIAL, SUSTAINED RISE OF VOLATILITY, THAT’S THE KEYWORD, IS SUSTAINED, NOT A TEMPORARY SPIKE TO 25 OR 30, MORE OF A SUSTAINED MOVE ABOVE 20. I THINK THAT IF YOU SEE THAT BETWEEN NOW AND THEN AT THE END OF THE YEAR, IF YOU START TO SEE VIC SPENDING MORE TIME ABOVE 20 THAN BELOW, I THINK WE’RE GETTING CLOSE TORE A RECESSION AND IT IS SOMETHING THAT I THINK PEOPLE NEED TO TAKE SERIOUSLY SHAWN, THE LAST TIME YOU WERE ON WITH US, I BELIEVE YOU MADE QUITE THE CALL INTO THE FED MEETING. HOW ARE YOU POSITIONING INT JACKSON HOLE. >>THIS OVER HEAD RESISTANCE HERE IS SOMETHING TO TAKE SERIOUSLY, THE POSSIBILITY THAT WE GO BACK AND TEST THAT 2835 LEVEL I THINK IS A REAL POSSIBILITY. I THINK THERE IS NOTHING WRONG WITH BEING A LITTLE BIT MORE CONSERVATIVE, WAIT TO SEE IF YOU GET THAT BREAK-OUT, AND WAIT TO SEE WHAT POWELL HAS TO SAY, WORSE CASE YOU MISS THAT FIRST, KIND OF FIRST MOVE HEADING BACK TOWARDS NEW HIGHS, TO ME, IT IS A FAVORABLE RISK, REWARD PROFILE, KEEP A LITTLE BIT ON THE SIDELINES RIGHT NOW. >>SO, YOU WOULD ACTUALLY HOLD ONTO MORE CASH AT THE MOMENT, SHAWN, IS WHAT YOU ARE SAYING. >>I THINK GOING ON THE REST OF THE WEEK, BETWEEN THE MINUTES TOMORROW AND JACKSON HOLE, I THINK BEING A LITTLE MORE CONSERVATIVE MAKES SENSE, WHO KNOWS, YOU MAY GET AN OPPORTUNITY TO IF WE GO DOWN TO RETEST THE 2835, IF NOT, YOU CAN DEPLOY THAT CAPITOL GOING INTO THE BEGINNING OF NEXT WEEK. >>WHAT’S CRACKING ON THE BIG BOARD. >>APPLE IS UP HALF A PERCENT, MICROSOFT IS DOWN A THIRD. LOOKING ACROSS THE BOARD A LOT OF RED HERE, THE BIGGEST GAINER IS HOME DEPOT. AFTER THE EARNINGS, THE PRE- MARKET, WE DID SEE IT DOWN. IT SPIKED UP 2.3% GOES BACK TWO DAYS THIS IS THE OPENING BAR RIGHT HERE, IT IS FUNNY HOW THE NARRATIVE CHANGES, PEOPLE ARE CONCERNED ABOUT FALLING LUMBER PRICES, NOW THE NARRATIVE IS, IT COULD HAVE BEEN WORSE, LOOKING AT OTHER STOCKS, GOLDMAN SACHS THE DOW IS POINT WEIGHTED, THIS CONTRIBUTED A LOT, DOWN 7.3%, FINANCIAL IS UNDER PRESSURE, LOOKS GENERALLY AFTER THEY HAD A NICE OUTPERFORMANCE YESTERDAY BASED UPON THE YIELD CURVE WIDENING. IF WE LOOK AT THE, LET’S LOOK AT THE RETAIL SECTOR BECAUSE WE HAVE ANOTHER NAME THAT’S REPORTED AS WELL. WE HAVE T.J. X, DOWN 3%, LET’S TAKE A LONGER TERM THIS IS YEAR TO DATE. HAD BEEN CLOSE TO ALL-TIME HIGH HERE, BUT IT IS TESTING SUPPORT AT THE 4950 LEVEL, DON’T WANT TO SEE IT CLOSE BELOW THAT PARTICULAR SUPPORT LEVEL. >>>I’D LOVE TO SEE YOU WEIGH IN ON RETAIL, VERY MIXED, YOU HAVE MACY’S ON THE ONE HAND WITH THE DISMAL REPORT, THE STOCK WAS PUNISHED AS A RESULT, WAL-MART OUT WITH BETTER THAN EXPECTED RESULTS, WALL STREET APPLAUDS THAT STOCK, WHAT’S YOUR OVER ALL FEELING ON RETAIL RIGHT NOW. >>YEAH, SO WE’RE FOCUSED ON EQUITY VOLATILITY, REALLY OUR AREA OF EXPERTISE IN NOT INDIVIDUAL COMPANIES, I THINK THAT COMPANY WHERE YOU COMPARE A MACY’S TO A WAL-MART DOES KIND OF TELL YOU A LITTLE BIT WHERE THE CONSUMER MIND SET MAY BE LOOKING A LITTLE BIT MORE VALUE. I THINK THERE IS A LITTLE BIT MORE CONSERVATIVENESS AND CONCERN, THAT DYNAMIC IS NOT THAT SURPRISING. >>SHAWN, HOW ARE YOU LOOKING TO GET POSITIONED ONCE THE DAY IS OVER, VOLATILITY SPIKE SEPTEMBER AND OCTOBER HAVE TEND TO COME WITH PRETTY SIGNIFICANT VOLATILITY, NOT ALWAYS, SOMETIMES THEY TEND TO BE QUIET, IT GOES BACK TO MY GENERAL MIND SET RIGHT NOW IS WAIT FOR SOMEOPPORTUNITIES TO COME ABOUT. I DON’T THINK THE VOLATILITY IS OVER WITH. I THINK WE’RE GOING TO PROBABLY GET AT LEAST ONE MORE VOLATILITY SPIKE BETWEEN NOW AND THE END OF THE YEAR, GIVEN THAT SEASONALITY THAT COMES ITH SEPTEMBER AND O THINK WE’LL BE DUE FOR AT LEAST ONE MORE, POSSIBLY TWO BEFORE THE END OF THE YEAR, THAT’S GOING TO BE A GREAT OPPORTUNITY TO TAKE ADVANTAGE OF WHETHER YOU ARE AN EQUITY INVESTOR, VOLATILITY INVESTOR, TAKE ADVANTAGE OF NICE OPPORTUNITY. >>WHAT CAUSES THAT VOLATILITY SPIKE. >>DISAPPOINT AROUND SOMETHING MOST LIKELY CHINA TRADE TALKS, OR A FED NOT AS AGGRESSIVE IN CUTTING RATES AS THE MARKET WOULD LIKE THEM TO BE. PROBABLY A COMBINATION OF THOSE TWO THINGS, PROBABLY THE MORE IMMEDIATE ONE I THINK EVERYONE IS GOING TO WANT TO SEE THE FED BEING MORE DUBBISH, THERE COULD BE SOME DISAPPOINT THERE. >>WHAT DO YOU DO, THOUGH, WHEN WE HAVE THESE WHAT I CALL TEASERS, THESE BOUNCE BACK DAYS, WE BOUNCE BACK BUT RIGHT BACK DOWN A DAY OR TWO LATER. DO YOU JUST SIT BACK AND LET THAT PLAY OUT AS AN INVESTOR OR DO YOU JUMP IN THERE AND CHERRY PICK OPPORTUNITIES? >>YEAH, I HATE TO ENCOURAGE INVESTORS OF BEING TOO SHORT TERM IN THEIR THINKING, THERE ARE OPPORTUNITY INS A MARKET LIKE THIS WHERE IT IS RANGE BOUND FOR A CERTAIN PERIOD OF TIME TO KIND OF PICK YOUR SPOTS. US AS VOLATILITY INVESTORS, IT IS GREAT FOR US WHEN THE MARKET IS AT 2835 TO TAKE ADVANTAGE, WHEN THE MARKET RALLIES TO 2900 AND CHANGE TO BUY BACK SOME OF THAT VOLATILITY AT LOWER LEVELS. WE’RE IN A GREAT POSITION, A LITTLE BIT MORE AGNOSTIC TO THE VOLATILITY GOING FROM LOW TO HIGH, BACK DOWN TO LOW AGAIN. >>WHERE IS THE BOTTOM OF THE BANKS? >>WE COULD TAKE A LOOK AT A COUPLE CHARTS, JP MORGAN A LOT OF THESE BANKS ARE AT CRITICAL THRESHOLDS, 105 LEVEL, DON’T WANT TO CLOSE BEFORE THAT, BANKS UNDER PRESSURE TODAY I THINK YESTERDAY WAS A BIT OF A RELIEF RALLY, WE HAVE A POP IN YIELDS. BANK OF AMERICA AT A STRONG SUPPORT LINE THAT GOES BACK A LONG WAY. IF YOU BREAK THESE THINGS, THERE IS A LOT OF DOWNSIDE. IF YOU DO A MEASURED MOVE WE’RE TALKING 5%, 10% DEPENDS WHAT THE INDIVIDUAL STOCK IS DOING. IF WE LOOK AT CITY GROUP, WE HAVE THIS NICE EXTEND, BROKEN RECENTLY, NOW TESTING ITS OWN SUPPORT LEVEL. BANK STOP IS KIND OF BREAKING DOWN, IF YOU GO BACK IN HISTORY SEVERAL DECADES EVEN BANK STOCKS TEND TO TOP OUT WELL BEFORE THE FED STARTS EASING OR WHEN THE FED STARTS EASING, YOU PROBABLY DON’T WANT TO BE BUYING THEM RIGHT NOW, BETTER TO WAIT UNTIL THE OTHER SIDE UNLESS YOU ARE WARREN BUFFET, AND YOU ARE A LONG TERM INVESTOR. >>AND YOU HAVE BILLION OF DOLLARS TO BACK IT UP. >>>YOU HAVE, YOU MENTIONED EARLIER POWELL WILL BE SPEAKING AT THAT IMPOSEIUM ON FRIDAY COULD THAT BE HEADING INTO A SUMMER WEEKEND DEPENDING UPON WHAT HE SAYS. >>UNFORTUNATELY THE NEXT BIG EVENT FOR THE FED ISN’T FOR LATE SEPTEMBER, THAT’S KIND OF A LONG TIME FOR INVESTORS TO WAIT FOR ANY CLEAR GUIDANCE, YOU’LL HAVE FED GOVERNOR SPEAKING BETWEEN NOW AND THE NEXT MEETING, LOOKING FOR REASSURANCE ON FRIDAY. >>SHAWN GIBSON BOTH TO SEE THEM AGAIN, JARED, THANKS VERY MUCH. >>>LET’S GO BACK DOWN TO THE NEW YORK STOCK EXCHANGE, SEE WHAT’S GOING ON IN THE EARLY GOING. >>>WE’RE WATCHING FINANCIALS AND ENERGY WHICH ARE UNDER PRESSURE THIS MORNING, WE ARE WATCHING BEYOND ME SEEING A POP THIS MORNING UP ABOUT 8% THIS IS AFTER A NOTE TO OVER WEIGHT FROM NEUTRAL. FOR POTENTIAL BEYOND ME TO REQUIRE NEW FOOD SERVICE CUSTOMERS ALSO THE NOTE SAYING THE SECONDARY OFFERING SPOOKED 40% FROM ITS HIGH, ONCE AGAIN. TANKING DOWN 17% AFTER THE FDA DENIED APPROVAL FOR ONE OF ITS DRUGS FOR A RARE MUSCLE-WASTING DISEASE. THIS SEEMS TO BE A SURPRISE FOR WALL STREET. SOME ANALYSTS PRICED THEIR MARKET ON THE STOCK. WE’RE WATCHING MEDTRONNICS MEDTRONICS, THAT INVESTMENTS THEY’VE MADE IN THE PIPELINE WILL PAY OFF THE STOCK IS UP MORE THAN 3% THIS MORNING. SOUNDS GOOD. INEZ, THANKS FOR THE WALL STREET UPDATE. >>>THE U.S. IS WARNING GREECE AGAINST HOSTING THE I IRANIAN OIL TANKER AT THE HEART OF AN INTERNATIONAL DISPUTE, YAHOO FINANCE IS BACK WITH US FOR TODAY’S COMMODITY’S REPORT. >>WE HAVE CRUDE OIL DOWN THREE QUARTERS OF A PERCENT, YOU WOULD THINK WITH RISING TENSIONS IN THE MIDDLE EAST THE PURCHASE GULF MAYBE THAT WOULD APPLY SOME BULLISH FORCE TO THE MARKET, NOT REALLY THE CASE HERE, THAT’S KIND OF WHAT WE’VE SEEN LATELY ALL THOUGH I WILL SAY CRUDE OIL WILL FILL UP AS WELL. THIS IS THE OVERNIGHT PRICE ACTION, WE CAN SEE THAT WE DIP INTO THE RED AROUND 7, 8:00 A.M. THEN IT IS JUST TRENDED A LITTLE BIT LOWER IF WE GO OUT TO 2 MONTHS WE CAN SEE THE TREND CHANNEL WE’VE BEEN TRACKING, IF IT DOES BUST OUT TO THE UP-SIDE, WE COULD SEE A RETURN TO 60. IF IT FAILS PROBABLY GO TEST THIS LOW AROUND 51 COULD DEFINITELY GO BELOW 50, THAT WOULD BE A SIGNIFICANT EVENT BUT I WOULD SAY TOPPING OUT FOR BOTTOMING OUT PROBABLY AROUND 46, 47 JUST REALLY THINKING ABOUT THE BIG PICTURE IN THE CRUDE OIL MARKET. WE HAVEN’T SEEN MANY OF THESE CATALYSTS ON THE UPSIDE TO BE ABLE TO DRIVE CRUDE THROUGH CRITICAL RESISTANCE LEVELS, WE HAVE TO THINK THERE ARE FORCES AT WORK HERE. >>>I THOUGHT THIS THING WAS DEAD A YEAR AGO, ARAMCO NOW SELECTED A COUPLE OF ADVISERS TO LEAD THE OFFERING, THE UNDER RIDERS, MULIS AND COMPANY, THESE ARE SMALLER BOUTIQUE INVESTMENT IRMS YOU PROBABLY HEARD OF LIZARED, FOR THAT WAS A VERY BIG SUCCESS, THEY ARE HAPPY WITH THAT, KEN MULIS, ALSO CALLED KEN OF ARABIA, HE WAS THE ONLY WALL STREET INVESTOR TO GO TO THEIR CONFERENCE IN OCTOBER THAT WAS RIGHT AFTER THE KILLING OF THE MURDER OF JAMAL KHASHOGGI, SO THEY ARE BEING REWARDED RIGHT NOW. THERE IS PROBABLY GOING TO BE ENDING UP WITH 5, 7 NAMES ON THIS UNDER WRITING LIST. WE’LL PROBABLY SEE SOME JP MORGANS AND GOLDMAN SACHS IN THERE AS WELL EVENTUALLY. >>>JARED, WE’VE GOT TO TALK ABOUT THE U.S. DOLLAR WHICH HAS BEEN ON A TEAR, WHAT HAS THE IMPACT BEEN ON COMMODITIES LIKE GOLD. >>PROBABLY HOLDING BACK, VERY STRONGHOLDING THE 1500 LEVEL PRETTY SOLIDLY. WE HAVE TO WATCH THE DOLLAR, THIS SHOOTS ABOVE THIS MULTI- YEAR HIGH, THAT’S GOING TO SPELL A LOT OF TROUBLE FOR THE MERGING MARKETS, CHINA GOING TO BE SPILLING OVER INTO MULTINATIONAL U.S. CORPORATIONS, ALL IN ALL, WATCH THE DOLLAR. ITS AFFECTS ON GOLD RIGHT NOW, WE’LL TAKE A QUICK LOOK AT THIS GOLD CHART HERE, WE CAN SEE IT IS AT 15, 13, STILL HOLDING AT 1500. >>THAT’S QUITE THE RUN. >>>A MIX PICTURE AT BEST, HOME DEPOT AND KOHL’S REPORTED, EMILYMCCORMICK HAS BEEN DIGGING INTO THE RESULTS. >>HOME DEPOT ARE ARE UP 3.5%, SHRUGGING OFF NEGATIVE POINTS AND LOOKING AT THE POSITIVES, THE COMPANY DELIVERED EARNINGS OF $3.17 ON SHARE OF REVENUE OF $30.84 BILLION IN THE FISCAL SECOND QUARTER, THAT WAS A BEAT ON THE BOTTOM LINE AND A MISS ON THE TOP LINE. FULL YEAR SALES GUIDANCE WAS ALSO CUT THE COMPANY SEES FULL YEAR COMP SALES UP 4% DOWN 5% SEEN PREVIOUSLY. ALSO SEE FULL YEAR REVENUE INCREASE OF JUST 2.3. THEY DID REITERATE THEIR FULL YEAR GUIDANCE, SUGGESTED EPS IS EXPECTED TO COME IN AT $10.03 A SHARE. THE MAIN CONCERN ON THE TOP LINE AND FOR THE TOP LINE GOING FORWARD IS LUMBER PRICE DEFLATION. THIS IS SOMETHING THAT THE COMPANY HAS TELEGRAPHED PREVIOUSLY, THEY SAID AT THE BEGINNING OF THE YEAR THAT IF LUMBER PRICES DIDN’T IMPROVE THEY COULD HIT ANNUAL SALES BY AS MUCH AS $600 MILLION WE’RE SEEING THAT CONTINUED IMPACT IN THESE RESULTS TODAY. >>>EMILY, I’M TAKING A LOOK AT KOHL’S, STOCK IS DOING PRETTY WELL, ALL THOUGH THERE WAS A MIXED PROFIT REPORT. >>A MISS ON THE TOP LINE, IT WOULD BE ON THE BOTTOM LINE HERE FOR KOHL’S. INVESTORS ARE WEIGHING THE % NEGATIVES, JUSTIN EPS, $1.55, BETTER THAN $1.53, REVENUE WAS A LITTLE BIT LIGHT, THAT WAS 4.7 VERSUS 4.2, COMPARABLE SALES WERE DOWN 2.9% THAT WAS WORSE THAN DOWN JUST 2.4% EXPECTED. COMPS DID TURN POSITIVE IN THE LAST SIX WEEKS OF THE SECOND QUARTER THAT’S SOMETHING THE CEO POINTED OUT EXPLICITLY IN THE REPORT, THAT WAS DUE TO A STRONGER-THAN-EXPECTED BACK TO SCHOOL SEASON, THAT’S SOMETHING THAT WILL LIKELY DAIRY OVER IN THE QUARTER AS WELL. >>>LAST BUT NOT LEAST, I’M LOOKING AT THE YAHOO FINANCE PLATFORM, DOWN 3%. >>SO WE’RE LOOKING AT THE CONTINUAL OF A MACY’S T.J. MAX DID HAVE A LITTLE BIT MORE OF A MACY’S SITUATION, EPX, SALES WERE VERY LIGHT THAT 9.7, ONE OF THE BIG FLAGS WAS INVENTORY. AT THE BEGINNING OF AUGUST THAT’S UP $600 MILLION YEAR OVER YEAR THAT TENDS TO BE A BAD SIGN FOR RETAILERS SHOWING THEIR MOST POPULAR ITEMS AREN’T GETTING SOLD EMILY MCCORMICK IN THE NEWSROOM THANKS SO MUCH. >>>TALK OF A GLOBAL ECONOMIC SLOW DOWN SEEMS TO HAVE TAKEN OVER WALL STREET LATELY AS INVESTORS HAVE DIFFERENT INDICATORS FOR CLUES WHEN A RECESSION MIGHT HIT, BRIAN, OF COURSE WE’VE BEEN TALKING ABOUT THAT INVERTED YIELD CURVE, HOW THAT COULD BE AN INDICATER, THERE ARE A LOT OF OTHER INDICATORS OUT HERE. >>I WROTE ABOUT THIS YESTERDAY ON AN AFTERNOON PIECE, YOU HAVE TO JUST BE PREPARED WE MAY SEE SOME FORM OF RECESSION NEXT YEAR, THERE ARE SIGNS. LOOK AT THE RUSSELL 2000. IT HAS LAGGED THE S&P 500 AND THE DOW THE PAST 6 MONTHS , DOW TRANSPORTS 5%, THESE MARKET INDICATORS NOT JUST THE YIELD CURVE, ALSO SUGGESTING BIG COMPANIES ARE STRUGGLING PROBABLY STRUGGLING FOR A REASON, IT IS LIKELY THE TRADE WAR. >>>YOU KNOW, YOU DON’T JUST AVE TO LOOK AT THESE ASSET CLASSES FOR INDICATORS, IF YOU HEAR FROM THE COMPANIES THEMSELVES AND HOTEL EXECUTIVES ARE SAYING WE’RE GOING TO PAUSE ON SPRUCING UP OUR HOTELS RIGHT NOW. >>I TALKED TO ONE WELL-KNOWN HOTEL EXECUTIVE YESTERDAY, I ASKED HIM, ARE YOUR PARTNERS PULLING BACK ON REMODELING, REMODELING IS SO INTEGRAL FOR THE HOTEL ENTRY, THERE ARE THOSE PULLING BACK ON REMODELING, EVEN OUTSIDE THE HOTEL INDUSTRY, YOU LOOK AT GOLD PRICES, HIGHER PRETTY MUCH THE PAST TWO WEEKS, COPPER PRICES AT MULTI-YEAR LOWS. THE SINGLES ARE OUT THERE, JUST BE PREPARED FOR IT. >>>YOU HAVE COMPANIES LIKE HEAVY EQUIPMENT MAKERS CATERPILLAR AND DEERE, FEDEX IS AS WELL. >>LOOK AT THAT JOHN DEERE, THAT CONFERENCE CALL WAS CERTAINLY NOT ENCOURAGING BY ANY STRETCH OF THE IMAGINATION. >>YOU ARE SAYING INVESTORS NEED TO BE PREPARED. >>YOU’VE SEEN A BIG PUSH IN CONSUMER STAPLES EVERYBODY IS BATTING DOWN THE HATCHES. >>YOU MENTIONED RV SALES, WE SPOKE THAT DEMAND IS STARTING TO WAYNE, THAT IN THE PAST THAT HAS BEEN A GOOD INDICATER. >>>DRUG MAKERS ENDO INTERNATIONAL AND ALERGIN EXPECTED TO BE A TRIAL CLOSING IN ON MULTI-MILLION DOLLARS SETTLEMENTS OVER OPIOID DRUGS, SELLING TO TWO OHIO COUNTIES ALONG WITH OTHER DRUG MAKERS AND DISTRIBUTORS AS DEFENDANTS IN A LAWSUIT LOOKING TO HOLD A PHARMACEUTICAL INDUSTRY ACCOUNTABLE IN THE OPIOID EPIDEMIC. HERE WITH MORE IS ALEXIS KEENAN, WALK US THROUGH THIS. >>THESE POSSIBLE SETTLEMENTS WITH ENDO, ALERGEN BOTH PART OF THE OPIOID LITIGATION ACROSS THE COUNTRY, THIS PARTICULAR CASE WAS BROUGHT BY TWO COUNTIES IN OHIO, CONSIDERED ONE OF THE BELL WEATHER CASES ALONG WITH ANOTHER CASE PENDING IN OKLAHOMA. NOW, THE CASE IS SET TO BEGIN IN OHIO IN OCTOBER SO THESE SETTLEMENTS WOULD MEAN THAT ALERGIN AND ENDO WOULD BE OUT OF THE CASES IF REPORTS OF THE SETTLEMENTS ARE TRUE, THAT ENDO WOULD BE CLOSE TO A $10 MILLION YEAR AND ALERGIE IN NEGOTIATIONS, POSSIBLE FOR A $5 MILLION DEAL, THOSE ARE CONSIDERED SMALLER PLAYERS IN THE OPIOID LITIGATION, ALL THOUGH THEY DO FACE LITIGATION WITH HUNDREDS OF CITIES AND COUNTIES AND STATES BRINGING ACTION ALSO OTHER ENTITIES BRING THOSE LITIGATIONS ACROSS THE COUNTRY TO THE COUPLE THOUSANDS THERE IS A LOT OF LITIGATION GOING ON HERE, VERY UNSETTLED. THE CASE IN OKLAHOMA THAT IS SIMILAR TO THIS ONE HERE THAT IS PENDING THE ARGUMENTS WRAPPED UP A COUPLE WEEKS AGO, THAT CASE IS PROCEEDING AGAINST J AND J, TO GIVE YOU AN IDEA OF THE TEAM OF SETTLEMENT, TABA SETTLED FOR $85 MILLION THIS IS ONGOING, THOUGH, BRIAN, THE LIABILITY AMOUNTS ARE WIDELY UNKNOWN. >>>ALL RIGHT ALEXIS KEENAN THANK YOU. >>>OUR BIGGEST EVENT OF THE YEAR WILL SOON BE HERE, THE YAHOO FINANCE SLATED FOR OCTOBER 10th RIGHT HERE IN NEW YORK CITY. FOR MORE DETAILS OUR GUEST LINEUP HOW TO GET YOUR TICKETS GO TO YAHOOFINANCEAMS.COM. >>>COMING UP THE STREAMING WARS RAGE ON. APPLE IS FINALLY ROLLING OUT DETAILS OF ITS NEW STREAMING SERVICE, WE’LL SEE HOW IT SIZES UP AGAINST NETFLIX. . >>>DOW JONES INDUSTRIAL AVERAGE NOW DOWN 102 POINTS AS THE SELL OFF INTENSIFIES IN THE BROADER MARKET THE NASDAQ IS UP, S&P 500 LOWER GIVING BACK 17, STAY WITH US WE’VE GOT COMPANIES TO WATCH COMING UP. . >>>WELCOME BACK TO THE FIRST TRADE, THE DOW WAS DOWN 115, THE S&P 500 ALSO IN THE RED, INVESTORS SEEM TO BE COMPLETELY IGNORING SOMEWHAT DECENT RETAILER THIS MORNING FROM THE LIKES OF KOHL’S. >>>NOW FOR A LOOK AT SOME OF THE COMPANIES, CHINESE SEARCH GIANT BIDU IS COMING OFF A STRONG QUARTER BEAT ON EARNINGS AND POSTED A SMALL BUMP IN REVENUE AS MORE PEOPLE SIGNED UP FOR ITS VIDEO STREAMING SERVICE NET PROFIT FELL 62%. THE CEO SAYS THEY REMAIN FOCUSED ON STRENGTHENING THE COMPANY’S MOBILE OFFERINGS. >>>MORE CUTS ARE COMING TO SOUTHWEST AIRLINES AS THEY STRUGGLE WITH THE GROUNDING OFTHE 727, GROUNDING FLIGHTS FROM BOSTON, ATLANTA, NEW YORK TO ORLANDO, LOS ANGELES TO CANCOON, SAYS THE CHANGE IS TO . >>>FREE UP PLANES FOR ROUTES WITH STRONGER DEMAND. >>>U.S. STEEL CORP. IS CUTTING JOBS IN DETROIT. FILING WITH THE STATE OF MICHIGAN SAYS THE LAY OFFS ARE TEMPORARY, COULD LAST BEYOND SIX MONTHS, THE COMPANY BLAMES LOWER STEEL PRICES AND WEAKER DEMAND. >>>GERMANY’S BUYER IS SELLING ITS ANIMAL HEALTH UNIT TO ALONCO, A DEAL AT $7.6 MILLION, THE ACQUISITION IS THE LARGEST YET SPIN OFF FROM ELI LILY IN AN IPO, PART OF A PLAN TO DIVEST ASSETS AS IT FACES GROWING LEGAL LIABILITIES FROM ITS ROUNDUP HERBICIDE. >>>THE UPCOMING LAUNCH OF DISNEY PLUS, WILL BE AVAILABLE ON MANY DEVICES INCLUDING ROKU AND GOOGLE’S CHROME CAST, YOU WON’T BE ABLE TO GET IT ON AMAZON’S FIRE TV, DISNEY PLUS IS SET TO LAUNCH NOVEMBER 12 FOR $6.99 A MONTH. THOSE ARE YOUR COMPANIES TO WATCH FOR THIS TUESDAY AUGUST 20th, YOU CAN SEE ALONCO COMING UNDER PRESSURE 4.7, BERDU RALLYING 70%. >>>BIG PLANS FOR ANOTHER STREAMING SERVICE, YES, APPLE TV FINALLY, TECH EDITOR IS IN THE NEWSROOM. DAN, WHAT DO YOU KNOW. >>Reporter: WE ARE HEARING APPLE TV COULD COME IN AT 999, THAT’S MORE EXPENSIVE THAN DISNEY PLUS, THAT’S AT 699, THAT HAS A HUGE LIBRARY FROM STAR WARS TO NATIONAL GEOGRAPHIC MARVEL, INCLUDING UNLIMITED $9.99, THAT WOULD BE HARD FOR PEOPLE TO SWALLOW, THESE ARE GOING TO BE ORIGINAL OFFERINGS FROM APPLE THE FIRST WE SAW WAS A TRAILER FOR THE MORNING SHOW THAT HAS STEVE KARELL, REESE WEATHERSPOON JENNIFER ANISTON, THE TRAILER, THERE ARE PLENTY OF OTHER OFFERINGS APPLE IS BRINGING FORWARD. AT $9.99 IT IS GOING TO BE ON THE PRICIER SIDE OF STREAMING SERVICES, DISNEY IS GOING TO BE UNDER CUTTING THAT SIGNIFICANTLY. >>LOOK, APPLE HAS TO BUY ALL THAT CONTENT, RIGHT, THEY HAVE TO HAVE A HIGHER PRICE POINT I WOULD IMAGINE, THEY ARE GOING TO BE SPENDING SOMETHING LIKE $6 BILLION, I THOUGHT, INITIAL REPORTS WERE A BILLION DOLLARS ON ORIGINAL CONTENT, DAN. >>>IT IS STILL NOTHING COMPARED TO NETFLIX, WHICH IS STILL HEMORRHAGING MONEY, THEY HAVE A WIDE VARIETY OF OPTIONS THEY AREN’T PRODUCING THEIR THIRD PARTY SHOWS, THE FRIENDS, THE OFFICE, PARKS AND REC, THOSE WILL BE LEAVING SHORTLY, WE’LL HAVE TO LEAN MORE HEAVILY ON PRODUCING THEIR OWN SHOWS, UNFORTUNATELY FOR APPLE THEY SEEM TO BE GOING IT ALONE WITH THIS, THAT COULD BE BECAUSE THEY DON’T WANT TO SHELL OUT ADDITIONAL MONEY TO GET THE RIGHTS TO PLAY THESE DIFFERENT TYPES OF SHOWS THAT THEY DON’T OWN, IT WILL BE INTERESTING TO SEE HOW THEIR ORIGINALS PERFORM COMPARED TO STRANGER THING, ROMO, NETFLIX, MARVELOUS MISS MAZEL. IT WILL BE AN INTERESTING TIME WHEN THOSE SERVICES LAUNCH LATER THIS YEAR. >>DO YOU THINK APPLE TV IS GOING TO BE HUGE? I THINK IT IS GOING TO BE HUGE FOR APPLE I DON’T KNOW IF IT WILL BE HUGE RIGHT OUT OF THE GATE, APPLE HAS A HISTORY OF LAUNCHING THESE SERVICES PEOPLE DISCOUNT THEM AT FIRST OVERTIME THEY START TO GROW, LOOK AT APPLE MUSIC THAT’S A GOOD POINT. THANKS SO MUCH. THAT’S IT FOR THE FIRST TRADE FOR THIS TUESDAY MORNING I’M ALEXIS. >>>WE HAVE MORE AT THE NEW YORK STOCK EXCHANGE, INEZ. >>>THE DOW IS UP ABOUT 75 POINTS, WE’RE WATCHING HOME DEPOT, THOUGH, THAT IS SEEING AN UP TICK AT 4% AFTER FEEDING ON ADJUSTED EARNINGS LOWERED THEIR FULL YEAR REVENUE GUIDE BECAUSE O LUMBER PRICE DEFLATION, ALSO SAYING, TALKING ABOUT THE POTENTIAL IMPACT OF TARIFFS ON THE U.S. CONSUMER WHEN IT COMES TO THEIR OUTLOOK, THEY REAFFIRM THEIR PROFIT GUIDANCE, WE’RE WATCHING ALSO KOHL’S THIS MORNING UNDER PRESSURE AFTER THEIR ADJUSTED EARNINGS CAME IN ABOVE ESTIMATES, SALES CAME IN BELOW ESTIMATES, STORES DOWN 2.9% LARGER THAN WHAT THE STREET WAS EXPECTING. T.J. MAX’S PARENT COMPANY IS UNDER PRESSURE, THIS IS AFTER THEIR SECOND QUARTER SALES MISSED EXPECTATIONS, SAME STORE SALES WERE UP BY 2% BUT THAT WAS BELOW WHAT THE STREET WAS EXPECTING. THEN GENERAL MILLS WE’RE WATCHING THIS MORNING NOT MOVING TOO MUCH ON THE NEWS OF SOME LEADERSHIP CHANGES, THEIR CFO DON MULLIGAN WILL BE RETIRING IN JUNE OF 2020. THE DOW IS OFF 77 POINTS THE S&P AND NASDAQ ARE ALSO LOWER, MAKE SURE TO STAY WITH US BECAUSE WI-FI A.M. STARTS RIGHT AFTER THE BREAK. >>>GOOD MORNING AND WELCOME TO YFi AM HERE AT YAHOO FINANCE ON THIS TUESDAY MORNING. I’M DAN ROBERTS. YOU HAVE SCOTT GAMM. MARKETS ARE IN THE RED. ALL THREE MAJOR INDICES IN THE RED. DOW DOWN 82 POINTS. NASDAQ DOWN 35. S&P SLIGHTLY IN THE RED AS WELL. GIVEN THAT RECENT MARKET VOLATILITY. WE HAD THAT DREADED YIELD CURVE INVERSION LAST WEDNESDAY MORNING BRIEFLY AT 6:00 A.M. THAT STOKED FEARS AFTER RECESSION. WITH ALL THAT GOING ON, THE TRUMP WHITE HOUSE IS NOW REPORTEDLY PREPARING DIFFERENT MOVES TO TRY TO JUICE THE ECONOMY. THOSE MOVES COULD INCLUDE A NEW PAYROLL TAX CUT AND A POSSIBLE REVERSAL OF SOME OF THE TRUMP TARIFFS. MAYBE IN CONTRAST THE PRESIDENT HIMSELF CONTINUES TO SAY OUR ECONOMY IS DOING QUOTE, TREMENDOUSLY WELL. AND OUR OWN RICK NEWMAN JOINS US NOW TO DISCUSS. WHERE IS THE TRUMPOMETER. >>HAS A STARRING ROLE ON THURSDAY’S FINAL ROUND. THAT’S WHERE IT RESIDES. YOU’LL HAVE TO TUNE IN. I CAN OFFER A PREVIEW. >>WHERE’S THE NEEDLE RIGHT NOW? >>THIS IS COMPLETELY INCOHERENT. BASICALLY WE HAVE TRUMP IMPOSING NEW TAXES ON AMERICAN CONSUMERS AND BUSINESSES THROUGH THE TARIFFS, JUST A REMINDER TO EVERYBODY. THOSE ARE TAXES ON AMERICANS, NOT ON CHINA. BUT NOW APPARENTLY CONSIDERING TAX CUTS ON SOME OF THE SAME PEOPLE. SO TAX MORE OVER HERE, TAX LESS OVER HERE AS IF IT’S GOING TO MAKE MUCH OF A DIFFERENCE. HOW ABOUT JUST UNDO THE TARIFFS. HE’S NOT GOING TO DO THAT. THERE WERE REPORTS TO THAT EFFECT. I DON’T THINK TRUMP’S GOING TO DO THAT BECAUSE HE’S JUST COMMITTED TO THAT SO STRONGLY. HE WOULD BE REVERSING HIS WHOLE APPROACH TO CHINA, WHICH WAS A BIG PART OF HIS CAMPAIGN PITCH. I DON’T THNK HE’S GOING TO DO THAT. WHO KNOWS. ANYTHING SEEMS POSSIBLE; RIGHT? >>IF WE GET A PAYROLL TAX CUT IS THERE WORRY THE CONSUMER MIGHT JUST SAVE THAT BECAUSE THEY’RE WORRIED ABOUT SOME SORT OF ECONOMIC DOWNTURN DOWN THE LINE AND THEN THAT DOES NOTHING FOR THE ECONOMY. >>THAT WOULD BE A RATIONAL WAY OF THINKING ABOUT IT BECAUSE THAT IS WHAT HAS HAPPENED IN THE PAST. WE KNOW, WE HAVE DONE THIS BEFORE, BY THE WAY. OBAMA SIGNED A PAYROLL TAX CUT, A TWO YEAR PAYROLL TAX CUT INTO EFFECT FOR 2011 AND 2012 AND THERE’S THIS, THERE WAS THE REBEAT AND PEOPLE DON’T REALLY REMEMBER THIS. GEORGE W. BUSH SENT A REBATE CHECK TO CONSUMERS IN 2008. CONSUMERS SPENT SOME OF IT AND SAVED SOME OF IT. WHAT WE KNOW, THIS IS SORT OF ECONOMIC ORTHODOXY. WE KNOW THAT WHEN YOU PUT POCKETS INTO, WHEN YOU PUT MONEY INTO THE POCKETS OF LOWER INCOME PEOPLE THEY TEND TO SPEND MOST OR ALL OF IT BECAUSE THEY NEED TO. WHEN YOU PUT MONEY INTO THE POCKETS OF HIGHER INCOME PEOPLE THEY TEND TO SAVE MORE OF IT. THE MOST EFFECTIVE STIMULUS MEASURES ARE ONES FROM THE MIDDLE CLASS ON DOWN. IF YOU LOOK AT THE 2017 TAX CUTS THAT REALLY DID BENEFIT BUSINESSES AND THE WEALTHY A LOT MORE THAN THE MIDDLE CLASS. >>EVEN FOR BUSINESSES IT’S HARD TO PLAN FOR THE FUTURE. EVEN FOR CONSUMERS. YOU DON’T KNOW WHAT TO DO EXACTLY EVEN IF YOU HEAR ABOUT THESE CUTS. YOU’RE NOT SURE WHAT THE FUTURE HOLDS OR HOW, WITH HOW QUICKLY THINGS HAVE BEEN CHANGING YOU’RE NOT SURE HOW TO PLAN FOR THAT. >>I DON’T THINK PEOPLE WOULD REINVEST IT. THE RISK TOLERANCE WOULD BE LOWER. >>A LOT TO DO WITH CONFIDENCE. HOW CONFIDENT ARE YOU THAT THINGS ARE SOLID AND THINGS ARE GOING TO BE FINE? THIS GETS TO THE WHOLE, THE ENTIRE PATTERN OF BEHAVIOR OF THE WAY PEOPLE SPEND MONEY. I MEAN WHEN YOU FEEL LIKE YOU HAVE JOB SECURITY, WHEN YOU HAVE MORE MONEY IN THE BANK, WHEN YOU FEEL LIKE YOUR ASSETS ARE GOING UP IN VALUE, WHATEVER YOUR RETIREMENT SAVINGS ARE AND HOUSE VALUE. YOU’RE GOING TO BE MORE LIKELY TO SPEND MONEY. WHEN YOU’RE CONCERNED ABOUT THOSE THINGS YOU’LL BE LESS LIKELY TO SPEND MONEY. YOU’LL WANT TO SAVE. THIS IS THE WHOLE CONFIDENCE QUESTION WHICH IS THE BIGGEST INTANGIBLE IN ECONOMICS IS HOW PEOPLE FEEL. >>BUT I GUESS I DON’T UNDERSTAND WHAT BOOST THIS ECONOMY NEEDS WITH UNEMPLOYMENT AT A 50 YEAR LOW. THE ECONOMY STILL GROWING AT 3%. >>STOCKS ARE DOWN. >>STOCKS ARE DOWN SLIGHTLY. 3%. >>SCOTT, STOP BEING RATIONAL. THIS IS ABOUT POLITICS. >>YOU’RE MISSING THE POINT. >>THIS IS ABOUT TRUMP GETTING REELECTS. >>THEN DO IT CLOSER TO THE ELECTION. >>HE’S NOT PROPOSING ANYTHING YET. GO BACK TO 2018. SO A LESSON FOR TRUMP WAS WHEN HE STARTED TO SEE THAT DEMOCRATS, IT WAS LOOKING LIKE DEMOCRATS WERE GOING TO SWEEP AND THEY DID TURN OUT TO SWEEP IN 2018. WEEKS BEFORE THE ELECTION HE SAID WE’RE CONSIDERING ANOTHER MIDDLE CLASS TAX CUT. HE PULLED THAT OUT OF NOWHERE. THERE WAS NO PLAN FOR THAT. BUT HE REALIZED TOO LATE THAT THE TAX CUT FROM 2017, WHICH HAD ONLY BEEN IN EFFECT FOR 10 MONTHS AT THAT POINT WASN’T DOING THE JOB AT THE VOTING BOOTH AND WAS NOT PERSUADING PEOPLE TO VOTE FOR REPUBLICANS. HE NEEDED SOMETHING ELSE. THIS TIME AROUND MAYBE HE’S TRYING TO GET IT OUT THERE MORE AHEAD OF THE GAME. THIS WOULD HAVE TO BE LEGISLATION. YOU HAVE TO GET THIS IN FRONT OF CONGRESS. IT WOULD TAKE MONTHS. >>OR DO NOTHING. WE’LL SEE. THANKS SO MUCH. >>>HUAWEI ONCE AGAIN IN THE MIDDLE OF THE STRAINED U.S.- CHINA TRADE TALKS. CRITICIZED A MOVE BY THE TRUMP ADMINISTRATION MONDAY WHICH BLACKLISTED DOZENS OF THE COMPANY’S AFFILIATES FROM DOING BUSINESS WITH THE U.S. AS QUOTE UNQUOTE, POLITICALLY MOTIVATED AND UNJUST. THIS OCCURRED THE SAME DAY THAT U.S. COMMERCE SECRETARY WILBUR ROSS GRANTED A 90 DAY EXTENSION TO FIRMS DOING LIMITED BUSINESS WITH HUAWEI. JOINS US IS ROGER BAKER. THANKS FOR JOINING US TODAY. >>THANK YOU. >>SO LOOKS LIKE THIS 90 DAY EXTENSION ON ONE HAND AND THEN THE BLACKLISTING OF AFFILIATES ON THE OTHER HAND, IT’S A BIT OF A TOSS UP THERE. WHAT ARE WE LOOKING AT HERE? IS THIS JUST DEINVOLVING INTO POLITICAL RHETORIC AT THIS POINT? >>THAT’S BEEN A BIG PROBLEM OF THIS FOR A WHILE WHEN YOU LOOK AT NOT ONLY THE HUAWEI ISSUE WITH THE UNITED STATES BUT THE OVERALL TRADE DISCUSSIONS WITH CHINA. IT’S CAUGHT UP IN SEVERAL DIFFERENT SORT OF GROUPS OR SETS OF INTENTS WITHIN THE ADMINISTRATION, WITHIN THE U.S. GOVERNMENT. THERE’S A POLITICAL COMPONENT TO IT, WHICH I THINK YOUR PREVIOUS GUESTS WERE TALKING ABOUT IN REGARDS TO LOOKING AT TAXES AND LOOKING AT OVERALL TRADE ISSUES. THERE IS A NATIONAL SECURITY AND STRATEGIC COMPONENT, THEN THERE’S A BROAD BASED ECONOMIC AND ECONOMIC COMPETITIVE COMPONENT TO IT. HUAWEI LIKE WE SAW A YEAR AGO IS KIND OF CAUGHT IN THE MIDDLE OF ALL OF THOSE AND SO THERE’S NO REAL COHESIVE PLAN FOR WHAT TO DO ABOUT THE COMPANY AND WHAT THE U.S. IS GOING TO DO DOWN THE ROAD. >>THANKS FOR COMING ON. JUST RECENTLY WE SAW THAT REN ZHENGFEI SAID IF THE U.S. WERE TO COMPLETELY CUT OFF THE COMPANY WE’D BE JUST FINE. HE SAID SOMETHING AKIN TO WE’VE CONTINUED TO PRODUCE AND IT WOULDN’T HURT US. MEANWHILE IT WOULD HURT THESE U.S. COMPANIES MUCH MORE. WHAT DO YOU MAKE OF THAT? IS THAT DISHONEST OR THE CASE? AS I UNDERSTAND IT HUAWEI DOES RELY ON ITS U.S. PARTNERS JUST AS SOME OF THOSE U.S. COMPANIES RELY ON HUAWEI. >>I THINK IT’S SHORT TERM WISHFUL THINKING. THEY MAY HAVE AN ABILITY TO START TEASING OUT THEIR SUPPLY CHAIN. BREAK IT OFF FROM SUBCOMPONENTS OF THE UNITED STATES AND EASE THEIR WAY THROUGH. I THINK THAT’S THE LONGER TERM ISSUE WE NEED TO BE LOOKING AT HERE IS IN BROADER GLOBAL SUPPLY CHAINS OF TECHNOLOGY. BECAUSE AS YOU HAVE THESE TYPES OF COMPETITION BETWEEN THE UNITED STATES AND CHINA GOING ON. OVER TIME COMPANIES WILL HAVE TO START FINDING DIFFERENT SUPPLIERS, START TO TEASE THEMSELVES OUT OF THESE PRIMARY CHAINS SO THEY’RE NOT CAUGHT UP IN THE POLITICAL COMPETITION. AND THAT CAN START TO LEAVE SOME OF THE MIDDLE COUNTRIES TRYING TO FIGURE OUT WHICH SIDE THEY’RE ULTIMATELY GOING TO WORK WITH. >>HEY, ROGER. SCOTT GAMM HERE. ANY TIME WE SEE NEWS ABOUT HUAWEI BEING LIMITED IN THE U.S. WE TEND TO SEE THE CHIP STOCKS MOVE DOWN. BUT YOU MENTION NATIONAL SECURITY ISSUES EARLIER. WOULDN’T LIMITING HUAWEI IN THE U.S. BE A GOOD THING LONG TERM FOR SOME OF THESE COMPANIES IF INDEED THIS IS A NATIONAL SECURITY ISSUE? >>IT WOULD CONCEPTUALLY BE A GOOD THING LONG TERM FOR THE UNITED STATES. BUT AS WE TALKED ABOUT NOT HAVING QUITE A COHESIVE STANCE ON WHAT’S GOING ON, THIS IS ALL COMING AT THE SAME TIME THAT THE U.S. ADMINISTRATION IS GOING TO BE TARGETING LARGE U.S. TECH COMPANIES. >>GREAT, WE’LL KEEP AN EYE ON THAT. THANKS SO MUCH, ROGER. >>>LET’S TAKE A DEEP DIVE INTO WHAT STOCKS ARE DOING RIGHT NOW. LET’S TALK MORE ABOUT MARKETS AND THE TRADE WAR AND THE IMPACT OF EVERYTHING HAPPENING. JOINING US FROM MINNEAPOLIS IS BRYCE DODE. BRYCE, THANKS FOR COMING ON. >>THANK YOU FOR HAVING ME. >>LET’S TALK ABOUT THE VOLATILITY OF THE LAST FEW WEEKS IN STOCKS AND THEN WE WERE JUST DISCUSSING AT THE TOP OF THE SHOW THIS REPORT THAT THE TRUMP ADMINISTRATION IS CONSIDERING SOME KIND OF NEW CHANGES TO JUICE THE ECONOMY. OBVIOUSLY HE’S SEEN THE MARKET AND DOES NOT LIKE IT. CAN’T TOUT THAT AS A WIN RIGHT NOW. INCLUDED IN THIS REPORT IS MAYBE A NEW PAYROLL TAX CUT. WHAT DO YOU MAKE OF THAT? >>WELL, SEEMS LIKE THE MARKET WAS RELYING ON A POWELL PUT BEFORE TO SAVE IT. HAVE THE FED COME TO THE RESCUE NOW MAYBE THEY’RE LOOKING FOR A TRUMP PUT. ANY TIME THE STOCK MARKET GETS TOO VOLATILE THEY’RE LOOKING TO SOMETHING POSITIVE ON TRADE OR DO SOMETHING ELSE LIKE WHAT YOU JUST MENTIONED. YOU KNOW, IT’S PROBABLY A SHORT LIVED BOOST, BUT THIS PATTERN WE’VE SEEN, IT’S KIND OF A SAW TOOTH PATTERN IN THE STOCK MARKET. I THINK THAT’S GOING TO CONTINUE FOR SOME TIME. IT’S DIFFICULT TO PLAY IT, BUT IF YOU CAN BE BRAVE ON THE DAYS WHEN THE MARKET’S WEAK AND NOT GET SWEPT UP TO ANY OPTIMISM THAT SEEMS TO BE PROPELLING IT HIGHER AND MAYBE PULL BACK A LITTLE BIT, THAT SEEMS TO BE THE WAY TO PLAY THIS VOLATILITY. >>LET’S TALK ABOUT THIS INVERTED YIELD CURVE SITUATION. WHAT GOT MISSED LAST WEEK WHEN THE YIELD CURVE INVERTED FOR 20 MINUTES IS THE FACT THAT THE YIELD CURVE NEEDS TO BE INVERTED FOR A PROLONGED PERIOD OF TIME IN ORDER FOR THE RECESSION BELLS TO REALLY RING. DO YOU AGREE WITH THAT AND HOW COME PEOPLE AREN’T TALKING ABOUT THAT? >>I DO AGREE. EVERY INVERSION HAPPENS UNIQUELY FOR DIFFERENT REASONS. NONE OF THEM HAVE BEEN CREATED BY A TRADE WAR. IT’S DIFFICULT TO REALLY THINK ABOUT EXACTLY HOW THIS IS GOING TO PLAY OUT. AS A BOND INVESTOR REMEMBERING THE CRISIS ALL TOO CLEARLY, WHEN I SAW INVERSION HIT THE SAME LEVEL IT DID IN 2007, THAT HAD CHILLING EFFECT ON ME. AS A VETERAN INVESTOR, IF I HAVE THAT KIND OF REACTION, I KNEW THAT THE DOWNTURN IN STOCKS HAD TO BE PARTIALLY DUE TO AN EMOTIONAL KNEE JERK REACTION. WE’RE ONLY FOUR BASIS POINTS AWAY FROM THAT INVERSION HAPPENING AGAIN. SO I THINK THERE’S A LOT OF EMOTIONS GOING ON AROUND THAT POINT THAT MAY HAVE NOTHING TO DO WITH THE LOGIC OF HEY, IS THIS REALLY GOING TO CAUSE A RECESSION OR IS OUR TEN YEAR TREASURY BECAUSE GERMAN TEN YEAR YIELDS ARE SO NEGATIV SO BY COMPARISON WE’RE BEING PULLED INTO THAT. AND THERE’S ACTUALLY A REALLY BIG POSITIVE THAT’S HAPPENING FROM THAT THAT NO ONE IS TALKING ABOUT. THAT’S THE REFINANCE BOOM WE COULD SEE FOR HOMEOWNERS. ANYONE TAKING OUT A MORTGAGE IN THE LAST TWO YEARS SHOULD BE LOOKING TO REFINANCE THAT MORTGAGE INTO A LOWER RATE. THEY SHOULD BE ABLE TO SHAVE OFF HALF TO A FULL POINT ON THEIR MORTGAGE. THAT’S A HUGE POSITIVE. I DO GET THE EMOTIONAL IMPACT OF SEEING THAT CURVE INVERT JUST THE WAY IT DID RIGHT BEFORE THE BIG RECESSION. THAT FEAR IS REALLY AND SO INFORMS TORES KIND OF NEED TO BE AWARE OF WHAT THE CURVE IS DOING JUST FROM THAT STANDPOINT ALONE. >>CAN WE TALK ABOUT THOUGH I GUESS THE IMPACT THAT LOWER INTEREST RATES HAVE ON COMPANIES? YOU KIND OF MENTIONED WHEN IT MEANS FOR HOMEOWNERS. JUST QUICKLY, IS THERE ANY EVIDENCE THAT LOWER RATES ARE BAD FOR COMPANIES? >>I’M WORRIED ABOUT HOW MANY TRIPLE B RATED COMPANIES THERE ARE RIGHT NOW. IT SEEMS LIKE COMPANIES ARE JUST BORROWING BORROWING BORROWING BECAUSE THEY CAN. AND THE MONEY IS SO CHEAP THAT THEY’RE INCREASING THE AMOUNT OF DEBT THEY HAVE WITHOUT ANY NEGATIVE REPERCUSSIONS. THE RATE AGENCIES AND ANALYSTS AND WHAT NOT, THEY LOOK AT THAT DEBT AND SAY WELL, IT’S CHEAP DEBT. IT’S NOT REALLY GOING TO HURT EARNINGS AND THIS AND THAT. JUST SEEMS LIKE IT’S NOT GOING TO END WELL IF PEOPLE KEEP PILING ON ALL THAT DEBT. SURE, LOWER RATES ARE GREAT. IF EVERYONE JUST KEPT THEIR DEBT LEVELS THE SAME AND BROUGHT ALL THEIR COST TO THAT DEBT DOWN, THAT’S FANTASTIC FOR THE ECONOMY AND EVERYTHING. BUT SO MANY COMPANIES ARE STARTING TO, YOU KNOW, LOAD UP THE TRUCK WITH DEBT AND THAT’S THE ONLY DOWNSIDE THAT I SEE FROM THE LOWER RATES. >>THAT MAKES A LOT OF SENSE AND THE KNEE JERK EMOTIONAL REACTION IN STOCKS IS RIGHT. WE’LL HOPE THAT ENDS SOON. THANKS FOR JOINING US. >>THANK YOU. >>>OKAY, LET’S GET A LOOK AT WHAT STOCKS ARE DOING RIGHT NOW ON THIS TUESDAY MORNING. 10:13 A.M. THERE SHE IS. INES FERRE. WHAT’S HAPPENING? >>RIGHT NOW WE’RE LOOKING AT THE DOW OFF JUST 66 POINTS. S&P AND NASDAQ IS ALSO LOWER. PRESSURE ON MATERIALS. CONSUMER STAPLES. WE ARE WATCHING KOHL’S AFTER THEY REPORTED THEIR LATEST QUARTER, THEIR ADJUSTED EARNINGS CAME IN ABOVE ESTIMATES. THEIR SALES WERE A MISS. SAME STORE SALES WERE DOWN. THAT’S LARGER THAN WHAT THE STREET WAS EXPECTING. THEY DID HIGHLIGHT IN THEIR REPORT THAT THE LAST SIX WEEKS OF THE QUARTER WERE STRONG. SO FAR THEY’VE HAD A SUCCESSFUL BACK TO SCHOOL SEASON AND THEY’VE SEEN INCREASED TRAFFIC BECAUSE OF THAT. AMAZON RETURN PROGRAM THAT THEY HAVE WHERE YOU CAN RETURN AMAZON ITEMS TO THEIR STORES. AND THEN WE’RE ALSO WATCHING TJ MAXX’S PARENT COMPANY. A LITTLE BIT UNDER PRESSURE THIS MORNING. THIS IS AFTER THEIR SECOND QUARTER SALES MISSED EXPECTATIONS. SAME STORE SALES WERE UP BY 2%. THAT’S BELOW WHAT THE STREET OF THE EXPECTING, DAN. >>THANKS. WE’LL CHECK BACK IN WITH YOU SOON. >>SEE YOU SOON. >>>COMING UP, HOME DEPOT BEATS ON EARNINGS EXPECTATIONS AMID THAT TOUGH RETAIL ENVIRONMENT. MEANWHILE, APPLE TV PLUS AND DISNEY PLUS ARE BOTH LAUNCHING IN NOVEMBER. PREPARING IF TO GO HEAD TO HEAD. WE’LL DISCUSS. >>>WELCOME BACK TO YFi AM AT YAHOO FINANCE. TAKE A LOOK AT WHAT STOCKS ARE DOING RIGHT NOW. WE ARE SEEING RED. THE DOW KIND OF STABLE. IT’S BEEN DOWN ABOUT 80 POINTS SINCE 10 A.M. WHEN THIS SHOW BEGAN. THE NASDAQ AND S&P ARE ALSO IN THE RED. TIME TO TALK ABOUT HOME DEPOT EARNINGS. IT MISSED ON SALES EXPECTATIONS BUT IT BEAT ON EARNINGS PER SHARE. BY THE WAY, HOME DEPOT HAS BEAT ON EARNINGS EXPECTATIONS EVERY QUARTER SINCE NOVEMBER 2012. WOW. THAT IS JUST ON EARNINGS PER SHARE, NOT REVENUE. JOINING US NOW TO DISCUSS, CFRA ANALYST KEN LEON. WHAT DO YOU MAKE OF HOME DEPOT BEATING ON EARNINGS? >>TODAY THE STOCK IS REACTING WELL AND IT’S PROBABLY BECAUSE THEIR RESULTS ARE BETTER THAN OTHER, WEAKER RETAILERS. THE EARNINGS SPEAK CAME BACK FROM BUYING BACK SHARES. THEIR OPERATING AND PRE-TAX INCOME WAS FLAT. SALES WERE MODEST. THEY LOWERED SALES GUIDANCE. THE QUESTION IS A LITTLE BIT MORE OPTIMISM TODAY. THE STOCK IS ACTING REALLY WELL. BUT LAST WEEK CONSUMER CONFIDENCE WAS DOWN 6.4%. >>AND KEN, YOU MENTIONED THAT HOME DEPOT CUT ITS SALES GUIDANCE FOR THE YEAR. THAT AS LUMBER PRICES ARE DEFLATING. IS THAT A DIRECT OUTCOME OF THE TRADE WAR OR UNCONNECTED? >>IT’S HAVING SOME EFFECT BUT IT’S VERY HARD TO MEASURE. YOU’VE GOT TO KEEP IN MIND THAT THE RECENT QUARTER RESULTS IS THE STRONGEST QUARTER OF THE YEAR. THE NEXT THREE QUARTERS IS GOING TO SHOW SLOWER SALES FOR HOME DEPOT. THEY REAFFIRMED GUIDANCE FOR THE YEAR ON EARNINGS, WHICH IS $10.01. THEN THEY’RE GOING TO BE BUYING BACK MORE STOCK. >>WHEN WE TALK ABOUT HOW TRADE AFFECTS THESE COMPANIES YOU CAN FACTOR THIS INTO TWO THINGS. A DIRECT MARGIN IMPACT AND BROADER UNCERTAINTY. REGARDLESS, CAN’T THESE COMPANIES WITHSTAND THAT IMPACT GIVEN THE MASSIVE TAX CUT ALL THESE COMPANIES GOT THAT STILL CONTINUES THIS YEAR? >>IT DOES. HOME DEPOT’S TAX RATE A LITTLE BIT HIGHER. THIS IS A DURABLE RETAILER. BUT IT’S BASED ON HOME IMPROVEMENTS. AGAIN, JULY WAS VERY STRONG. BIG TICKET SALES WERE UP. QUESTION IS ARE YOU GOING TO SEE THAT IN THE NEXT SIX TO NINE MONTHS. A LOT OF THAT WILL COME BACK TO YOUR QUESTION. >>LOOK AT THE LUMBER MOVE AS WELL. IT LOOKS LIKE SOME OF THE MANUFACTURERS THAT THEY WORK WITH ARE ALSO, YOU KNOW, PAYING ATTENTION TO WHAT’S GOING ON IN CHINA AND MOVING AS WELL FROM WHAT I HEARD ON THERRINGS CALL. DO YOU THINK THAT’LL AFFECT THE FUTURE? >>THE IMPACT FROM LUMBER IS, USUALLY LUMBER IS A COST. IT’S A BENEFIT. HOME DEPOT, THEY SELL LUMBER. THE EFFECT IS ROUGHLY $800 MILLION THIS YEAR. IT’S MOSTLY FROM CANADA. IT WAS $500 MILLION IN THE FIRST HALF. EXPECT $300 MILLION IN THE SECOND HALF. >>BEFORE WE LET YOU GO. IT’S BEEN A BIG COUPLE OF WEEKS FOR RETAIL. WE GOT THOSERRINGS LAST WEEK. IN SOME WAYS THOSE RAISED RETAIL ALARMS. WE GOT KOHL’S OUT TODAY. ANYTHING ELSE THAT YOU HAVE YOUR EYE ON RIGHT NOW? >>UM, AGAIN, WE’RE LOOKING TOMORROW AT LOWE’S. LOWE’S WILL BE REPORTING PROBABLY SIMILAR TO HOME DEPOT. BUT IT’S ALSO A TURN AROUND STORE WITH A NEW LEADERSHIP AND A PLAN IN PLACE TO BOOST SALES AND BOOST MARGINS. >>ALL RIGHT. KEN THANKS FOR COMING ON. >>>SOME OF THE COUNTRY’S BIGGEST TECH NAMES ARE FACING NEW SCRUTINY TODAY. A GROUP OF STATE ATTORNEYS GENERAL ARE REPORTEDLY LOOKING TO LAUNCH THEIR OWN INVESTIGATION INTO FACEBOOK, GOOGLE, AMAZON AND APPLE. MEANWHILE TWITTER AND FACEBOOK ARE ACCUSING CHINA OF SPREADING MISINFORMATION IN HONG KONG AMID THE PROTESTS THERE. YOU DON’T OFTEN SEE FACEBOOK AND TWITTER WORKING TOGETHER IN THAT WAY. YAHOO FINANCE’S TECH EDITOR DAN HOWLEY JOINS US TO DISCUSS. >>HOW’S IT GOING? >>GOOD. WHY DON’T WE START WITH THE STATE AGs. WHAT DO THEY THINK THEY CAN DO THAT’S NOT BEEN ACCOMPLISHED BY THE NUMEROUS OTHER INVESTIGATIONS AND PROBES? >>IT’S INTERESTING BECAUSE IF YOU LOOK BACK AT WHAT HAPPENED WITH MICROSOFT WAY BACK IN THE OLD DAYS. THAT’S MY MINOR ACCENT, I GUESS. WHAT HAPPENED WAS THE STATES ATTORNEY GENERAL WANTED TO BREAK UP MICROSOFT. THEY WERE REALLY PUSHING FOR IT. THE ORIGINAL RULING WAS THAT MICROSOFT SHOULD HAVE BEEN BROKEN UP. THERE WAS AN APPEAL AND SO THEY BASICALLY SAID OKAY, WE’LL COME TO AN AGREEMENT WITH THE MICROSOFT AND STATES AND BASICALLY COME UP WITH SOME KIND OF WAY TO MAKE YOU HAPPY AND NOT HAVE US BREAK UP. BUT THEY’RE REALLY HARD LINERS FOR STUFF LIKE THIS. THAT SEEMS TO BE THE WAY IT USUALLY GOES. IT’LL BE INTERESTING TO SEE HOW SOMETHING LIKE THIS CAN WORK OUT. USUALLY YOU CAN COME TO SOME KIND OF AGREEMENT WITH THE DOJ OR FTC. NOW YOU HAVE TO APPEASE THE STATES ATTORNEY GENERAL FROM VARIOUS STATES. THAT’S GOING TO ADD A HEADACHE. WHETHER OR NOT THEY’RE USING THEIR MARKET POWER TO DO ANYTHING THAT WOULD BE ANTICOMPETITIVE. THAT’S STIFLING COMPETITION, THAT’S AGGRESSIVE BUY OUTS OF COMPETITORS. THINGS ALONG THOSE LINES. IT’S THE SAME THING THE FTC IS LOOKING AT. SAME THING THE DOJ IS LOOKING AT. WE’VE SPOKEN TO EXPERTS BEFORE FOR VARIOUS STORIES ON THIS TOPIC. THE VAST MAJORITY OF THEM SAY BREAKING UP THESE COMPANIES ISN’T WHAT YOU WANT TO DO. WHAT YOU WANT TO DO IS HAVE SOME KIND OF REMEDY THAT ALLOWS THEM TO CONTINUE TO OPERATE BUT STRIPS THEM OF ANY ABILITY TO DO ANYTHING ANTI-COMPETITIVE. IT WOULD BE JUST, YOU KNOW, A, I FORGET WHAT THE EXACT NAME OF IT IS. IT WOULD BE A CONDUCT REMEDY FOR THEM. THAT’S REALLY THE WAY THAT A LOT OF THE EXPERTS THINK THIS IS GOING TO GO. NOT NECESSARILY BREAKING UP FACEBOOK, GOOGLE, BUT THE HEAD OF THE FTC HAS SAID WE COULD BREAK UP FACEBOOK. >>ALSO IT’S HARD TO DO. IT WOULD BE HARD TO DO. >>WE COULD DO IT. IT’S DIFFICULT. NO DUH IT’S DIFFICULT. >>I’M CURIOUS ABOUT THIS. USUALLY WHAT HAPPENS IN THESE SITUATIONS IS THEY DO AN INVESTIGATION AND IT ENDS IN A MULTIBILLION DOLLAR FINE THAT THESE COMPANIES CAN AFFORD. WE SEEN THAT IN EUROPE COUNTLESS TIMES. >>WE JUST SAW FACEBOOK HIT WITH A FINE FOR SOMETHING SEPARATE ENTIRELY BY THE FTC. THAT WAS FOR THE PRIVACY SCANDAL RELATED TO CAMBRIDGE ANALYTICA. IF WE SEE ANOTHER FINE COMING DOWN, THAT COULD BE MORE. THAT WAS THE LARGEST FINE FOR ANY KIND OF PRIVACY VIOLATION IN THE U.S. GLOBALLY REALLY. IT’LL BE INTERESTING TO SEE HOW THESE DIFFERENT INVESTIGATIONS PLAY OUT. THERE’S THREE CONCURRENT INVESTIGATIONS GOING ON WITH THESE TECH COMPANIES. DON’T FORGET THE FTC AND DOJ ARE SEEMINGLY JOCKEYING FOR POSITION TO SEE WHO GETS TO PROSECUTE WHO. IT SEEMED LIKE THERE WAS AN AGREEMENT. NOW THERE’S A TURF WAR. >>WE MENTIONED WHAT’S HAPPENING WITH CHINA AND FACEBOOK AND TWITTER. WE’VE SEEN A LOT OF BUZZ ON TWITTER ABOUT MISINFORMATION ABOUT THE HONG KONG PROTESTS. WHAT ARE TWITTER AND FACEBOOK DOING? >>THEY’VE TAKEN DOWN A NUMBER OF ACCOUNTS, POSTS, GROUPS IN THE DIFFERENT SOCIAL NETWORKS THAT WERE PUSHING FORWARD THIS PROPAGANDA. THIS CHINESE STATE PROPAGANDA. THEY’VE LINKED IT TO THE CHINESE STATE-RUN ENTITIES BECAUSE THEY WERE OPEN IP ADDRESSES. IF YOU’RE IN CHINA. >>YOU HAVE TO VPN IN. >>PROBABLY MEANS YOU’RE WORKING FOR THE STATE. THAT’S REALLY WHAT HAPPENED HERE. THEY WERE LIKE WELL, WE JUST KIND OF FOLLOWED THE THREAD. >>EASY SLEUTHING. >>YEAH. IT WAS INTERESTING. WE WERE ON THE FINAL ROUND YESTERDAY AND HE POINTED OUT THIS ISN’T SOMETHING CHINA USUALLY DOES. THEY DON’T WANT TO BE PUBLICLY SHOWN AS INTERFERING LIKE THIS. THAT’S MORE OF RUSSIA’S MO. YES, WE’RE DOING IT. >>SHOWS YOU HOW SERIOUS THE HONG KONG PROTESTS ARE GETTING. LET’S GET INTO THE STREAMING WARS. ONE OF OUR FAVORITE TOPICS. WE ARE GETTING NEW DETAILS THIS MORNING ON APPLE’S PLANS FOR APPLE TV PLUS. APPLE TV PLUS IS SET TO LAUNCH IN NOVEMBER. IT’S THE LATEST PUSH IN APPLE’S STATED EFFORT TO REACH $50 BILLION IN SERVICES SALES BY 2020. APPLE IS SPENDING $6 BILLION ON ORIGINAL SHOWS. IT IS RUMORED TO COST $9.99 AT LAUNCH. SORRY, APPLE. DISNEY PLUS IS ALSO LAUNCHING IN NOVEMBER. THE COMPANY JUST ANNOUNCED DISNEY PLUS WILL BE ON APPLE TV, GOOGLE CHROMECAST, PS 4, ROKU, BASICALLY EVERY DEVICE AND PLATFORM EXCEPT NOT AMAZON FIRE TV AT LAUNCH. AND DISNEY PLUS WILL COST $6.99. SO PRICED VERY COMPETITIVELY WITH NETFLIX. NOW YOU HAVE A VERY CROWDED SPACE. YOU HAVE ALL THESE AND DISNEY PLUS LAUNCHING. WE KNOW THAT SOON THERE WILL BE A NEW ONE FROM NBC UNIVERSAL BECAUSE NBC IS SPENDING A LOT TO GET THE OFFICE BACK. YOU HAVE AN HBO ONE COMING. WHAT DO YOU MAKE OF THIS? HOW IS DISNEY GOING TO DO? >>DISNEY IS STUPID CHEAP. THAT IS RIDICULOUS. >>SMART. >>THE FACT I CAN GET ALL OF MARVEL, ALL OF STAR WARS, ALL OF THE DISNEY CATALOG AND UNLIMITED SIMPSONS. >>BECAUSE OF DISNEY AND FOX. >>$6.99 A MONTH. THAT IS RIDICULOUS. I DON’T SEE ANYBODY PASSING THAT UP. I THINK THAT THIS IS FOR APPLE IT’LL BE INTERESTING BECAUSE $9.99 IS ON THE MORE PREMIUM END OF THINGS. NOT AS BAD AS THE HBO. BUT APPLE’S SHOWS AREN’T PROVEN ENTITIES. WITH DISNEY YOU KNOW WHAT YOU’RE GOING TO GET RIGHT OFF THE BAT. OH YEAH, THEY’RE THROWING IN ADDITIONAL SHOWS ON TOP OF THAT. DIFFERENT MARVEL SHOWS. LOKI. >>THIS IS THE STUDIO THAT JUST HAD FIVE BILLION DOLLAR MOVIES IN ONE YEAR. >>THEY TOOK THE LION KING AND MADE A BILLION DOLLARS. >>WHAT STRIKES ME IS THIS WHOLE STREAMING BONANZA WAS SPARKED BY CORD CUTTING, WHICH WAS CAUSED BY PEOPLE NOT WANTING TO PAY SO MUCH FOR THEIR CABLE BILL. YOU SAW THAT GRAPHIC. WHAT WE’RE GOING TO DO NOW IS PAY EVERY NETWORK $10 A MONTH TO GET THEIR SHOWS. WHAT WE’RE GOING TO END UP DOING IS SPENDING MORE. >>MAYBE YOU’LL BE HAPPY YOU’RE DOING IT. >>I WON’T BE. >>WHEN YOU HAD THAT YOU COULD BUNDLE THAT WITH YOUR INTERNET. NOW YOU HAVE YOUR INTERNET. SAY THAT COSTS YOU $50, 70, SOMEWHERE IN THAT RANGE. IT BECOMES MORE EXPENSIVE THAN CABLE DID. SO IT’S, YOU KNOW, AT SOME POINT MY THESIS IS WE’RE AT THE POINT OF VAST EXPANSION AT SOME POINT SOME OF THESE NETWORKS AREN’T GOING TO, STREAMING SERVICES AREN’T GOING TO BE ABLE TO GET THE VIEWERS AND THEY’RE GOING TO CONSOLIDATE AND THAT’S WHERE WE’LL END UP. >>THEY’RE LOOKING AT PACKAGING. YOU CAN GET TWO OR THREE OF THE STREAMING PRODUCTS IN ONE FOR ONE PRICE. >>BUNDLE. YEAH. >>SO THEY’RE ALREADY PARKING, THEY’RE GOING RIGHT BACK TO THAT WHOLE CABLE IDEA. >>WE CUT THE CORD, NOW WE WILL REBUNDLE. >>DISNEY’S GOING TO BUNDLE HULU, THE AD SUPPORTED VERSION WITH ESPN PLUS ALONGSIDE DISNEY PLUS FOR A REALLY. >>I DIDN’T REALIZE IT WAS HULU WITH ADS. THAT MAKES MORE SENSE. I SAW HOW LOW THE PRICE WAS. >>THE PRICE, I FORGET WHAT IT IS. >>$12.99 MAYBE. I’M SURE WE’LL HIT THIS TOPIC AGAIN. WE’LL SEE YOU SOON, DAN. >>>SPEAKING OF DISNEY. YOU MIGHT RECALL LAST WEEK WHEN THE GE WHISTLE BLOWER ACCUSED GE OF INFLATING ITS EARNINGS REPORT. NOW DISNEY HAS A WHISTLE BLOWER. A FORMER SENIOR FINANCIAL ANALYST WHO WORKED AT DISNEY FOR 18 YEARS HAS FILED A SERIES OF WHISTLE BLOWER TIPS CLAIMING DISNEY OVERSTATED ITS REVENUE FOR YEARS. SHE IS ALLEGING EMPLOYEES WORKING IN THE PARKS AND RESORTS BUSINESS WERE ABLE TO SYSTEMATICALLY OVERSTATE REVENUE BY BILLIONS BY EXPLOITING WEAKNESSES IN THE ACCOUNTING SOFTWARE. HERE ARE SPECIFIC EXAMPLES. WE SHOULD MENTION THE SEC HAS NOT COMMENTED ON THE CLAIMS. A DISNEY SPOKESPERSON SAID THE CLAIMS ARE UTTERLY WITHOUT MERIT. HERE ARE THE SPECIFICS. THIS IS VIA MARKET WATCH. RECORDING FICTITIOUS REVENUE FOR COMPLIMENTARY GOLF ROUNDS. RECORDING REVENUE FOR $500 GIFT CARDS AT FACE VALUE EVEN WHEN THE GUESTS PAID A DISCOUNTED RATE OF $395. RECORDING REVENUE TWICE FOR GIFT CARDS BOTH WHEN THE GUEST BUYS IT AND WHEN THE GIFT CARD WAS USED. THAT’S WRONG. THAT’S JUST SIMPLE MATH. YOU ONLY GOT THE $500 ONCE. >>YEAH. I AGREE WITH YOU ON THE WHOLE IS IT PLAUSIBLE BECAUSE IT’S REALLY SPECIFIC EXAMPLES. IT’S MINUTE STUFF THAT YOU WOULDN’T NECESSARILY WANT TO LIE ABOUT. >>THAT’S WHY IT MAKES SENSE TO ME. YOU NEVER KNOW WHAT TO BELIEVE. THESE EXAMPLES ARE THINGS THAT YOU HAVE HEARD OF HAPPENING IN PLACES, YOU KNOW. I’VE HEARD OF SOMEONE FIRED FRM A COUNTRY CLUB FOR DOING BASICALLY THE SAME THING. YOU GET PAID FOR A TENNIS LESSON, THEN YOU CHARGE AGAIN WHEN YOU GIVE THE TENNIS LESSON. >>IS THE REVENUE BOOST THAT MATERIAL FROM DOING IT? >>I DON’T KNOW. >>APPARENTLY IN IT 2009, IT MIGHT HAVE HAD A SIGNIFICANT REVENUE BOOST. THIS IS GOING BACK TEN YEARS. >>THERE WAS A TIME WHEN THE PARKS WERE BOOMING. EVERYBODY WAS BUSY FOCUSING ON THE INCREDIBLE NUMBERS FROM THE FILM STUDIO. THERE WAS A DARK CLOUD. THAT WAS THE NEW STAR WARS SET UP. OVERALL PARKS REVENUE, I BELIEVE, DID NOT. VISITORS WERE DOWN. THAT WAS A DARK CLOUD. WELL, WHAT ARE THEY GOING TO DO ABOUT THAT? THAT WAS ALWAYS THE STEADY MONEYMAKER. >>THE FCC GETS 25,000 COMPLAINTS AND TIP AS YEAR FOR STUFF LIKE THIS. WE ONLY TALK ABOUT THE BIG ONES. >>YOU’RE RIGHT. THAT’S SOME GOOD COLD WATER TO CONSIDER ALL THIS WITH. >>WE’LL KEEP WATCHING THIS AS WELL. >>>LET’S TAKE A LOOK AT ANOTHER ONE OF OUR TRENDING TICKERS. IT IS BEYOND MEAT. THE STOCK IS SURGING AFTER JP MORGAN UPGRADED IT TO OVERWEIGHT FROM NEUTRAL WITH THE STOCK DOWN 40% FROM ITS PEAK. JP MORGAN THINKS THE STOCK IS APPEALING ONCE AGAIN. YOU’LL REMEMBER THE COMPANY ISSUED A SECONDARY STOCK OFFERING A FEW WEEKS AGO AND WHILE THAT LEFT A BAD TASTE FOR INVESTORS, JP MORGAN POINTS OUT THAT THE CEO ONLY SOLD A SMALL PORTION OF HIS HOLDINGS SO HE’S STICKING WITH THE STOCK. JP MORGAN EXPECTS BEYOND MEET TO STORE ADDITIONAL CUSTOMERS IN THE FOOD SERVICE SPACE. I MEAN, I GUESS IT’S AN ENDORSEMENT FOR THE STOCK TO SEE JP MORGAN COME OUT AT THIS STAGE AND UPGRADE THE STOCK. >>EVEN DOWN 40%, IT’S STILL, BECAUSE IT SOARED SO HIGH THAT IT’S STILL UP BIG FROM THE IPO. >>HUGE. >>TO THINK IT HAS MORE ROOM TO RUN. >>CAN THE INDUSTRY ITSELF HAS MORE ROOM TO RUN. >>YOU CAN’T BLAME ETHAN BROWN FOR SELLING PART OF HIS HOLDING. ANYONE WOULD LOCK IN GAINS AT THAT LEVEL. >>I GUESS HE ONLY SOLD A LITTLE BIT. THEY’RE PLEASED ABOUT THAT. >>>JUST THE OTHER DAY I WENT TO A BARBECUE PARTY, A FRIEND HAD A BARBECUE. THEY HAD BURGERS, DOGS, THEY HAD SOME BEYOND MEAT BURGERS. IT WAS ALL ABOUT THE GIMMICK. I WANT TO TRY THAT. OH, I HAVEN’T HAD THAT. SO I DO THINK RIGHT NOW THE COMPANY IS BENEFITING FROM A SHORT LIVED, TEMPORARY INTEREST FROM JUST THE NEWNESS OF IT. SO HOW LONG WILL THAT LAST. >>>COMING UP, ROSS STORES. IT’S FACING LEGAL ACTION FROM LULULEMON FOR SELLING WHAT LULU SAYS ARE IMITATION LULU LEGGINGS. WE’LL DISCUSS THIS INTERESTING CASE. >>>WELCOME BACK TO YFi AM AT YAHOO FINANCE. ALL THREE MAJOR AVERAGES ARE STUCK IN THE RED SINCE WE’VE OPENED THE DOW RIGHT NOW IS MOVING LOWER SLOWLY BUT SURELY. NASDAQ AND S&P IN THE RED AS WELL. LET’S GET MORE INSIGHT ON WHAT SPECIFIC STOCKS ARE DOING ON THIS TUESDAY. LET’S GO BACK TO INES FERRE. >>LET’S TAKE A LOOK AT SOME OF THE DOW LAGGARDS RIGHT NOW. IF YOU TAKE A LOOK YOU’RE LOOKING AT DOW, JOHNSON AND JOHNSON, ENERGY STOCKS ARE UNDER ARE ISSUE THIS MORNING AS WELL AS MATERIALS AND ALSO FINANCIALS. IF YOU LOOK AT THE GAINERS YOU HAVE HOME DEPOT LEADING THE WAY. UP MORE THAN 4%. APPLE AND WALGREENS ARE SEEING SOME SLIGHT GAINS. WE’RE WATCHING THIS MORNING SEREPTA THERAPEUTIC SHARES DOWN ABOUT 13%. THIS IS AFTER THE FDA DENIED APPROVAL FOR THEIR NEWEST DRUG FOR A RARE MUSCLE WASTING DISEASE. NOW THIS SEEMED TO BE A BIT OF A SURPRISE TO WALL STREET. SOME ANALYSTS HAVE BEEN SLASHING THEIR PRICE TARGET. SO YOU’RE SEEING THAT STOCK UNDER PRESSURE THIS MORNING. AND THEN WE’RE WATCHING A BIT OF A REBOUND GOING ON WITH JC PENNEY. THEIR CHAIRMAN RECENTLY BOUGHT A MILLION SHARES OF THE STOCK LAST WEEK WHEN IT HIT A LOW OF 53 CENTS A SHARE. THEY RECENTLY HAD ANNOUNCED THEIR SECOND QUARTER SALES THAT WERE A MISS. SALES HAVE BEEN DECLINING FASTER THAN EXPECTED. NAY ARE AT RISK OF DELISTED BECAUSE THEIR SHARE PRICES BELOW A DOLLAR. THE COMPANY SAID IT IS CONSIDERING A REVERSE STOCK SPLIT AT THEIR NEXT SHAREHOLDER MEETING TO PROP UP THE PRICE ABOVE A DOLLAR. BUT YOU ARE LOOKING AT JC PENNEY TODAY IS SEEING A LITTLE BIT OF A POP. STILL NOT UP TO A DOLLAR THOUGH. >>I SAW SOMETHING THAT SAID JC PENNEY WAS DOWN 99%. THAT CHART IS BRUTAL. >>TOTALLY BRUTAL. >>THANKS. >>>AMID THOSE RECESSION FEARS THE U.S. HOUSING MARKET REMAINS STABLE. NEW RESEARCH SHOWS IT COULD PROBABLY HELP WARD OFF A RECESSION. JOINS US IS BESS FREEDMAN. WHAT IS KEEPING THE HOUSING MARKET HEALTHY AND I FOUND THIS INTERESTING, ESPECIALLY BECAUSE WE KEEP HEARING, I FEEL LIKE, THAT MILLENNIALS AREN’T INTERESTED IN BUYING HOMES. >>I THINK THAT CONFIDENCE IS GOD AND WHEN RATES ARE LOWER IT’S GOOD BECAUSE IT MAKES BUYERS FEEL LIKE THEY SHOULD PURCHASE. THAT’S BEEN GOOD. MILLENNIALS ARE LOOKING FOR VALUE. SO SELLERS HAVE ADJUSTED PRICES AND SO THAT’S MAKING BUYERS AND SELLERS HAVE A MEETING OF THE MINDS, WHICH HAS BEEN GOOD OVERALL. >>IS IT MORE OF AN INVESTMENT SIDE BUYING OR MORE OF ACTUAL HOME BUYING? >>WELL, LET’S TALK SPECIFICALLY ABOUT MANHATTAN, WHICH IS, YOU KNOW, IT’S VERY SMALL INVESTOR. IT’S MORE PEOPLE WHO ARE LIVING THERE FULL TIME. SO THAT HAS BEEN VERY SOLID. IT IS A BUYERS MARKET. THERE’S NO IFS, ANDS OR BUTS ABOUT THAT. IT IS A BUYER’S MARKET. SELLERS HAVE HAD TO ADJUST THEIR PRICES IF IT THEY WANT TO GET A DEAL DONE. >>THERE’S OBVIOUSLY A LOT OF RECESSION TALK, WHETHER THAT’S WARRANTED OR NOT. LET’S TAKE IT AS IT IS, ASSUMING THERE WOULD BE A RECESSION IN THE NEXT SAY TWO YEARS, DO YOU THINK THAT COULD ACTUALLY HELP THE HOUSING MARKET BECAUSE PEOPLE MIGHT MOVE MONEY INTO THE STOCK MARKET AND INTO REAL ESTATE? >>I WOULD HOPE SO. THE ONLY NEGATIVE IS WHEN THERE’S A RECESSION, IT’S CONSUMER CONFIDENCE IS SHAKY. PEOPLE TEND NOT TO BUY IN AN ENVIRONMENT THAT’S UNCERTAIN. SO WE LIKE WHEN THINGS ARE STABLE. A STABLE SHIP IS A GREAT ENVIRONMENT FOR BUYERS AND SELLERS. SO RECESSION, I DON’T THINK OVERALL IS A GOOD THING. BUT MAYBE YOU’RE RIGHT WE’D HAVE TO SEE WHAT WOULD HAPPEN. >>STABLE IS NOT THE WORD I’D USE RIGHT NOW FOR MOST OF THE U.S. ECONOMY. LET ME ASK ALSO WHETHER PEOPLE ARE BUYING HOMES AS AB INVESTMENT OR JUST BECAUSE THEY’RE READY TO GROW INTO A HOME. THERE WAS AN INTERESTING STORY IN BUSINESS WEEK A COUPLE MONTHS AGO. THIS WAS MOSTLY ON THE WEST COAST. YOUNG PEOPLE WHO WERE FLIPPING HOMES AND HAVING GREAT SUCCESS WITH THAT AND THEN SUDDENLY THEY STARTED LOSING THEIR SHIRTS BECAUSE THE MARKET TURNED. TELL US ABOUT THAT TREND BOTH NEW YORK AND OUTSIDE. I IMAGINE IT HAPPENS LESS IN NEW YORK. >>LIKE FOR EXAMPLE MIAMI IS MORE OF AN ENVIRONMENT THAT IS HEAVY INVESTOR. PEOPLE WILL INVEST IN MIAMI AND THEN TRY TO SELL, BUT THE PROBLEM IS THAT JUST TO PURCHASE THE COST OF GOING IN TO BUY IS EXPENSIVE. THEN WHEN YOU TRY TO SELL AND CAN’T TURN A PROFIT, THEY’RE HITTING A STUMBLING BLOCK. NEW YORK CITY IS NOT THAT KIND OF MARKET. IT’S A MARKET WHERE PEOPLE LIVE FULL TIME. WE’VE SEEN FOR EXAMPLE, LET’S TALK ABOUT THE SALT TAX. WE’VE SEEN A MIGRATION OF NEW YORKERS MOVING TO FLORIDA. I THINK THEY’RE SAYING LIKE 300,000 PEOPLE IN 2019 WILL MOVE TO FLORIDA. >>WOW. >>BUT DON’T YOU THINK PEOPLE HAVE TRADITIONALLY MOVED TO FLORIDA BECAUSE OF CLIMATE, BECAUSE OF FAMILY, BECAUSE OF JOBS. I THINK THE SALT TAX, THAT CAP ON THE DEDUCTION IS HAVING AN IMPACT, BUT I DON’T THINK IT’S CONCLUSIVE AS TO WHY PEOPLE ARE MOVING. >>TAXES IN SOME AREAS ESPECIALLY IN LIKE THE MORE EXPENSIVE NORTHEAST REGION HAS FACTORED INTO THE MOVE AS WELL. I’M CURIOUS TO KNOW ABOUT FOREIGN INVESTMENTS. >>THE FOREIGN BUYERS HAVE SOMEWHAT DRIED UP. WE USED TO HAVE AN INFLUX OF CHINESE BUYERS. THEY’RE JUST NOT DOING THAT AS MUCH AS THEY USED TO. WE’D LOVE TO HAVE MORE FOREIGN BUYERS IN NEW YORK CITY. >>DO YOU THINK THE TRADE WAR IS AFFECTING THAT? THE WHOLE STORY WAS CHINESE PURCHASING OF ICONIC MANHATTAN HOTELS AND BUILDINGS. >>THOSE DAYS ARE OVER. THOSE DAYS ARE OVER. >>ALL THOSE BUILDINGS ON 57th STREET. NO ONE IS LIVING IN THEM. >>BILLIONAIRES ROW AS THEY LIKE TO CALL IT. THOSE GET ALL THE PLAY IN THE NEWS, PEOPLE LOVE THOSE STORIES. BUT THE EVERY DAY PEOPLE ARE NOT LIVING IN THOSE BUILDINGS. NEW YORKERS WHO LIVE AND RAISE THEIR KIDS HERE LIKE ME, THALIA IN REGULAR TWO AND THREE BEDROOM APARTMENTS. BUT THE BIG BUILDINGS, PEOPLE LOVE TO LOOK AT THEM. >>THEY STILL GOING TO BUILD THOSE? >>YES, THEY’RE GOING UP. LIKE 520 PARK WHICH IS A GREAT PROJECT HAS DONE WELL IN THE SALES. SO IT JUST DEPENDS ON WHAT THE PROJECT IS. >>WE’LL KEEP MONITORING. VERY INTERESTING TO USE WHAT’S HAPPENING WITH REAL ESTATE AS AN INDICATOR OF THE OVERALL ECONOMY. THANK YOU SO MUCH. >>THANK YOU. >>>DRUG MAKERS ENDO INTERNATIONAL AND ALLERGAN COULD AVOID A TRIAL SET TO BEGIN IN OCTOBER. BOTH COMPANIES ARE REPORTEDLY CLOSE TO MULTIMILLION DOLLAR SETTLEMENTS WITH TWO OHIO COUNTIES THAT NAME THEM ALONG WITH OTHER DRUG MAKERS AND DISTRIBUTORS AS DEFENDANTS IN A LAWSUIT LOOKING TO HOLD THE PHARMACEUTICAL INDUSTRY ACCOUNTABLE IN THE OPIOID EPIDEMIC. HERE WITH MORE IS ALEXIS KEENAN. WHAT’S THE LATEST? >>THE LATEST IS THAT ENDO HAS JUST COME OUT, ITS CHIEF LEGAL OFFICER AND SAID WE HAVE IN FACT REACHED A SETTLEMENT IN PRINCIPLE. SO BIG NEWS THERE. SAYING THE COMPANY WILL PAY $10 MILLION FOR THIS PARTICULAR LAWSUIT BROUGHT BY THE TWO COUNTIES IN OHIO. JUST THAT. SO IT’S JUST EXCLUSIVE TO THAT. ALSO THEY WILL DONATE $1 MILLION WORTH OF DRUGS FREE OF CHARGE. THEY’RE CARVING OUT ONE PIECE OF GETTING RID OF THIS VERY EXPANSIVE LITIGATION THEY ARE FACING, AS ARE OTHER OPIOID DRUG MAKERS ACROSS THE COUNTRY. THEY’RE FACING LAWSUITS BY STATES, COUNTIES, ENTITIES, YOU NAME IT. THE LIABILITIES HERE ARE VERY, VERY HARD TO PREDICT. >>AS THEY SHOULD. >>AND IT’S REALLY INTERESTING TO LOOK AT. SO YOUR POINT ON HARD TO PREDICT BECAUSE YOU HAVE THE $10 MILLION HERE. WE HAD CONVERSATIONS ABOUT OTHER NUMBERS LAST WEEK. WE LOOKED AT WHAT HAPPENED IN OKLAHOMA WITH SUCH A LARGE SETTLEMENT. THE VARYING AMOUNTS AND IT’S JUST GOING TO ALSO DEPEND ON HOW MUCH OF THE POPULATION WAS AFFECTED AND HOW MUCH THEY GO AFTER IT. IT’S REALLY TOUGH TO SEE THE FUTURE OF THESE COMPANIES AND HOW THEY’RE GOING TO BE AFFECTED BY THIS; RIGHT? >>SO ENDO’S CHIEF LEGAL OFFICER ACTUALLY SAID, WE WON’T HOLD OUR BREATH, SAID DON’T USE THIS AS INDICATIVE OF WHAT’S TO COME ACROSS THE COUNTRY. I THINK THAT’S, IT’S GOING TO BE HARD PRESSED TO FORCE ANYBODY, PLAINTIFFS ATTORNEYS, PARTICULARLY, TO NOT AT LEAST USE THAT AS SOME SORT OF INDICATOR. BUT THERE ARE SO MANY FACTORS IN PLAY. IF YOU LOOK AT THE LITIGATION THAT JUST FINISHED ARGUMENTS IN OKLAHOMA. ANOTHER BELL WEATHER TRIAL LIKE THE OHIO CASES. THAT ONE JUST WRAPPED UP AND PERDUE GOT OUT OF THAT $270 MILLION. IN THAT CASE J&J STANDS ALONE. THEIR STRATEGY IS TO DEFEND THESE CASES, NOT TO OFFER UP SETTLEMENTS. >>I THOUGHT YOU WERE GOING TO SAY THE ENDO EXECUTIVE SAID DON’T TAKE THIS AS AN ADMISSION OF GUILT. I HAVE TO SAY ALL OF THESE LAWSUITS AND THE OVERALL STORY REMINDS ME OF THE TOBACCO INDUSTRY AND WHAT THE TOBACCO INDUSTRY WENT THROUGH IN THE LATE 80s, I BELIEVE. >>VERY SIMILAR. >>JUST FACING LAWSUIT AFTER LAWSUIT AFTER LAWSUIT. IT WAS LIKE WELL, YOU KNOW, IF IT WE SETTLE THIS ONE DOES THAT SET A BAD PRECEDENT THAT WE HAVE TO SETTLE ALL OF THEM AND DOES IT SHOW WE’RE ADMITTING THE GUILT. >>WITH THESE SETTLEMENTS THEY’RE TECHNICALLY NOT ADMITTING GUILT. THAT’S AN IMPORTANT FACTOR FOR THEM. ENDO SAID THIS IS REPRESENTATIVE OF HOW MUCH IT WOULD HAVE COST THEM TO TAKE THIS PARTICULAR TRIAL THROUGH ALL THE WAY. >>WOW. >>ALEXIS, THANK YOU SO MUCH FOR THAT. WE APPRECIATE IT. >>A STORY THAT IS NOT GOING TO GO AWAY. >>>ROSS STORES IS BEING ACCUSED OF SELLING QUOTE, LOWEST QUALITY, COUNTERFEIT LEGGINGS IMPERSONATING LULULEMON LEGGINGS. THE PARTNER BRAND IS IOPA. IMPULSE OFF PRICE APPAREL. LULULEMON CLAIMED THAT THE IOPA LEGGINGS ARE HARMING LULULEMON’S BRAND AND CAUSING CUSTOMER CONFUSION. ROSS STORES STATED IT IS WITHOUT SUFFICIENT KNOWLEDGE OR ADMISSION TO FORM BELIEF AS TO THE TRUTH OF ALLEGATIONS. WHEN WE TALK ABOUT WHETHER THERE IS CUSTOMER CONFUSION, IT COMES DOWN TO WOULD A LAYPERSON ACTUALLY MISTAKE THIS IMITATION PRODUCT FOR THE REAL THING AND AS I UNDERSTAND IT, THANKS TO MY SISTER WHO IS AN IP LAW PROFESSOR AND HAS TALKED TO ME A LOT ABOUT THESE EXAMPLES. SOMETIMES THESE STORIES ARE FUN BECAUSE THEY’RE BRANDS YOU KNOW. EVEN WHEN A PRODUCT IS SO CLEARLY A RIPOFF, CLEARLY A PARODY, CLEARLY A PRODUCT MEANT TO LOOK LIKE A BETTER KNOWN PRODUCT. EVEN THEN IT DOESN’T MATTER, IT’S OKAY AS LONG AS A LAYPERSON WOULDN’T ACTUALLY MISTAKE THE PARODY PRODUCT FOR THE REAL THING. SO SHE HAS, MY SISTER HAS WRITTEN PAPERS ON EXAMPLES LIKE WHEN DOG CHEW TOY COMPANY WAS SELLING TOYS THAT SAID BUTT WIPER IN THE FONT OF BUDWEISER. BUDWEISER SUED, DIDN’T WIN. NO REGULAR PERSON WOULD SEE THAT AND THINK BUDWEISER MADE IT. >>IF YOU’RE SOMEONE WHO BUYS LULULEMON PRODUCTS, CHANCES ARE YOU’RE COGNIZANT OF THOSE CHARACTERISTICS SO YOU’LL, IF YOU DO SHOP AT ROSS STORES. IF YOU BUY LULULEMON PRODUCTS, I DON’T KNOW IF YOU’RE GOING INTO ROSS STORES. YOU’D PROBABLY SAY NOT LULULEMON. I’M GOING TO STAY AWAY. I’M GOING TO GO TO THE LULULEMON STORE, OF WHICH THERE ARE MANY. >>IF YOU’RE LULU, YOU’RE TRYING TO BE AGGRESSIVELY LITIGIOUS. YOU DON’T WANT ANYBODY HAVING AN ALTERNATIVE THAT SEEMS ALMOST AS GOOD AND IS A LOT CHEAPER. >>CONSUMERS AREN’T THAT STUPID. YOU’LL SEE AS A CONSUMER YOU’LL KNOW IF LULULEMON IS AVAILABLE THERE. AND IT REMINDS ME OF BACK IN THE DAY WHEN THEY WERE TALKING ABOUT ALL THE RIPOFFS ON STREET VENDORS IN NEW YORK OF PURSES AND ISN’T THAT STILL A THING? RIPOFF PURSES? >>CANAL STREET. GET YOUR FOLEX. >>IS THAT WHY? >>SPEAKING OF EXPERIENCE. >>STILL EXPENSIVE. IF YOU’RE GOING INTO ROSS STORES AND BUYING ONE OF THESE ITEMS OF CLOTHING, MAYBE EVENTUALLY YOU UPGRADE TO THE REAL ONE AT THE LULULEMON STORE. MAYBE IT’S A GOOD THING. >>RIGHT. IF YOU’RE LULU YOU WONDER WAS IT WORTH IT TO BRING THIS. I THINK IT’S OFTEN MORE ABOUT OPTICS AND BULLYING THAN ACTUALLY THINKING YOU’LL WIN THE CASE. ANOTHER EXAMPLE IN THESE EXAMPLES THAT I WAS TALKING ABOUT IS A DOG CHEW TOY CALLED CHEWY VUITTON LOUIS VUITTON DID NOT WIN IN THAT. >>>18 TO 23-YEAR-OLDS, DON’T THEY LIKE BEER AND THEY DON’T MUCH MIND HOW MUCH THEY DRINK. WE’LL SHARE OTHER FINDINGS FROM A NEW STUDY AND WHY THE STUDY IS GOOD FOR ALL THOSE HARD SELTZER BRANDS. >>>WELCOME BACK TO YFi AM AT YAHOO FINANCE. MARKETS IN THE RED. HOWEVER THE DOW OFF THE LOWS WE HAD SEEN A FEW MINUTES AGO. I BELIEVE IT WAS DOWN CLOSER TO IS HUNDRED POINTS. RIGHT NOW THE NASDAQ IS OFF 25 POINTS. S&P SLIGHTLY IN THE RED AS WELL. TIME NOW AT 10:50 A.M. TO TALK CEREAL. GENERAL MILLS IS MAKING SEVERAL CHANGES TO ITS SENIOR LEADERSHIP TEAM, INCLUDING ITS CFO WHO IS RETIRING. THE CHANGES WILL ALSO AFFECT LEADERSHIP OF THE COMPANY’S PET BUSINESS. THAT INCLUDES BLUE BUFFALO, AS WELL AS ITS EUROPE AUSTRALIA AND ANOTHER CHANGE AFFECTING GENERAL MILLS IS AMERICAN’S BREAKFAST HABITS. AMERICANS ARE EATING LESS CEREAL. SORRY, CEREAL BRANDS. WHAT WAS ONCE A PANTRY STAPLE IS BECOMING MUCH LESS POPULAR. CONSUMERS HAVE TURNED TO MORE PROTEIN RICH BREAKFASTS OR THEY GO THE OTHER ROUTE. THEY FORGO BREAKFAST ALL TOGETHER. CEREAL COMPANIES ARE DOUBLING DOWN ON NEW MARKETING CAMPAIGNS. WHO KNOWS IF THEY CAN STAUNCH THE BLEEDING. I AM STILL A CEREAL PERSON, BUT ONLY BECAUSE HERE AT YAHOO INANCE WE HAVE HONEY NUT CHEERIOS IN IN THE SNACK CORNER. >>BUT WE HAVE BANANAS TOO. >>WE DO. >>I GO RIGHT BY THE BANANAS. NO THANKS. >>YOU SHOULD ADD IT ALL TOGETHER. >>OF COURSE THAT’S WHAT I SHOULD DO. I WOULD DO WHAT I WATCHED MY DAD DO. CEREAL AND THEN HE’D SLICE UP A BANANA AND DISPERSE THE BANANA CYLINDERS ACROSS THE CEREAL. I’VE NEVER DONE IT MYSELF. >>MY DAD STILL DOES THAT TODAY. >>DADS. >>THAT’S NOT WHO THESE COMPANIES ARE TRYING TO TARGET. THEY’RE TRYING TO TARGET US. I DON’T HATE CEREAL. I JUST DON’T HAVE IT. I HAVE TWO EGGS IN THE MORNING. >>WOW. YEAH. >>THAT TAKES TIME TOO. >>HARD BOILED EGGS. >>THAT’S THE TRICK. >>OH, HEY NOW. AT HOME? >>AT HOME BEFORE I GO IN THEN WHEN I GET IN I’LL HAVE LIKE A BANANA OR SOMETHING. BUT COFFEE IS THE MAIN PRIORITY I THINK. >>OF COURSE. IF AND WHEN YOU DO HAVE CEREAL IN YOUR CURRENT LIFE, WHAT IS YOUR GO TO? >>HONEY BUNCHES OF OATS. >>CINNAMON TOAST CRUNCH. >>THAT’S JUST CANDY. >>YOU’RE LIKE THE STATISTIC HERE. >>I WILL ALWAYS BE A HONEY NUT CHEERIOS GUY. IF YOU RECALL, UNFORTUNATELY THERE WERE REPORTS OF CHEMICAL, I BELIEVE ROUNDUP IN HONEY NUT CHEERIOS. I DON’T CARE. I WILL JUST CONTINUE. >>YOU DON’T CARE? >>TRACE AMOUNTS. THERE’S BAD STUFF IN ALL KINDS OF STUFF. >>PROCESSED. THAT’S THE WHOLE POINT. >>WHICH IS PROBABLY WHY PEOPLE ARE FLOCKING TO CEREAL LESS. >>THAT’S RIGHT. ON THIS SHOW MONTHS AGO WE HAD IN A CEREAL BRAND AND IT WAS NEW AND HIP AND ARTISANAL AND MILLENNIAL AND ORGANIC AND THEY HAVE COOL ARTISTIC BEAUTIFUL BOXES AND IT WAS KIND OF LIKE HEALTHY TAKES ON CLASSIC BAD FOR YOU KIDS CEREALS. AND WE ATE SOME OF IT AND WE ALL THOUGHT IT WAS OKAY. THEN WE SAW IT WAS LIKE $14.99 A BOX. >>THEY’LL GET AWAY WITH THAT. >>YOU THINK SO? >>WE’RE GOING TO MOVE ON. STICK WITH THE TOPIC OF YOUNG PEOPLE AND THE FOODS THEY LIKE OR DON’T LIKE BECAUSE SOME BAD NEWS FOR THE BEER INDUSTRY. BANK OF AMERICA MERRILL LYNCH IS OUT WITH A SURVEY THAT SAYS YOUNG PEOPLE PREFER TO DRINK SPIRITS OVER BEER. SPECIFICALLY 18 TO 23-YEAR- OLDS. SO YOUNGER THAN MILLENNIALS. WE’RE NO LONGER THE TARGET DEMO. WHAT, GEN Z? HARD SELTZERS CONTINUE TO GAIN STEAM, MAKING UP NEARLY 21% OF ALCOHOL CONSUMPTION AMONG THAT GROUP IN THE PAST 12 MONTHS. AND MILLENNIALS LOVE THEIR WHITE CLAW. BUT NOT THEIR BEER. THE SURVEY FOUND THAT GEN Z DRINKERS PREFER SPIRITS OVER BEER, BUT MOST INTERESTING TO ME, THEY ARE NOT AS WORRIED AS MILLENNIALS ARE ABOUT MODERATING THEIR ALCOHOL CONSUMPTION OR COUNTING CALORIES. SO I GUESS THAT’S GOOD FOR THE SPIRIT INDUSTRY. ALTHOUGH IRONICALLY THAT COULD BE ENCOURAGING FOR BEER. EVEN THOUGH THEY DON’T LIKE BEER AS MUCH, WELL, THE PROBLEM IN THE PAST FROM BEER WAS YOU KNOW THEY CAME OUT WITH ALL THE LOW CALORIE, LOW, YOU KNOW, MGD 64. >>AND THEY VENTURED INTO SORT OF THAT SAME SPACE WITH THE DIFFERENT FLAVORS AND THE DIFFERENT, NOT JUST THE HARD SELTZER OPTIONS. >>BUD ICE. >>TO ME IT’S INTERESTING. I THINK THERE’S MORE TEMPTATION FOR THEM. OF COURSE THEY DON’T CARE ABOUT THEIR INTAKE BECAUSE THEY HAVE SO MANY MORE OPTIONS. >>DON’T FORGET CBD. >>OH DON’T GO THERE. WASN’T WINE BILLED AS LIKE A HEALTHY ALCOHOL? >>FOR A WHILE. >>FOR A WHILE WINE WAS HURTING BEER SALES. NOW AS I UNDERSTAND IT FORGET BOTH OF THOSE. IT’S ABOUT SPIRITS. WE’VE HAD ALL THESE EXECUTIVES AND THE SPIRITS COMPANIES SAYING TEQUILA IS MAKING A COMEBACK. >>ALL THE CRAFT. IT’S WHEREVER YOU CAN SORT OF MAKE YOUR OWN COCKTAIL OR CREATE THIS CRAFT IDEA. THE IDEA OF GETTING MORE INVOLVED IN IT. >>HOW CAN GEN Z AFFORD TO BUY THIS? >>THEY’RE ALSO EXPENSIVE. IT WAS ALL ABOUT THE WHITE CLAW. THERE WERE PROBABLY LIKE 200 WHITE CLAWS CRUSHED AND CONSUMED. >>DON’T KNOW. WE’LL SEE. >>>IN THE DEAD HEAT OF SUMMER LET’S TALK ABOUT HOW MANY PEOPLE WHO ENJOY RETURNING TO THEIR AIR-CONDITIONED HOMES, PLACE OF RELIEF AND COMFORT MAY HAVE TO SWITCH THAT HABIT FOR ENERGY EFFICIENCY. A NEW CONSUMER ENERGY REPORT SUGGESTS WE SHOULD CONTINUE OUR SWEATING AT HOME BY HAVING THE AC SET TO 78 DEGREES OR ABOVE. AND THAT’S FOR MAXIMUM ENERGY EFFICIENCY. THE REPORT SUGGESTS THE TEMPERATURE SHOULD BE KEPT AT 5:00 DEGREES WHEN YOU’RE NOT HOME, 82 DEGREES WHETHER YOU’RE SLEEPING. >>THAT’S TOO HOT. >>WAY TOO HOT. IT’S SUPPOSED TO BE COLD. YOU SLEEP DEEPER IN THE COLD. >>AS AN ISLANDER I’D LIKE TO TELL YOU THOSE SOUND LIKE COMFORTABLE TEMPERATURES. I’LL GO WITH IT. I’D TAKE IT. >>SEE WHAT’S INTERESTING ABOUT THIS IS THAT’S THE OPPOSITE OF THE LARGER DEBATE WHICH HAS BECOME WHY ENDERRED. THE RIGHT TEMPERATURE IN THE OFFICE PLACE. AND HOW WOMEN TEND TO BE COLDER AND MEN COMPLAIN THAT IT’S HOT BECAUSE I GUESS MEN RUN HOT? I DON’T KNOW. I’M ALWAYS HOT. IT’S TRUE. >>TAKE OFF THE JACKETS. TRY IT WITHOUT THE JACKETS AND YOU’LL FEEL BETTER. >>I HAVE A LITTLE FAN AT MY DESK HERE. >>OH MY GOD. PLEASE. >>IT’S ON ALL YEAR ROUND. IN THE WINTER TOO. COUPLE MONTHS AGO WITH THAT HEAT WAVE AND NEW YORK CITY REGULATED HOW, YOU KNOW, COLD YOU COULD KEEP YOUR OFFICE. >>REGULATORS, MOUNT UP. OKAY. THAT IS THE SHOW FOR TODAY. THAT IS YFi AM. THANKS FOR WATCHING. WE WILL BE RIGHT BACK HERE AT 10:00 A.M. TOMORROW. BUT DON’T MISS ON THE MOVE. THAT SHOW STARTS NEXT. IT STARTS IN TWO MINUTES. AND ALSO WE WANT TO TELL YOU THAT OUR BIGGEST EVENT OF THE YEAR IS COMING UP AS YAHOO FINANCE ALL MARKET SUMMIT. GO TO YAHOOFINANCEAMS.COM FOR MORE INFORMATION ABOUT OUR NEXT BIG SUMMIT. GUZMAN. >>>FULL STREAM AHEAD AT 11:00 A.M., WE’RE HERE 90 MINUTES IN THE TRADING DAY AND THE STOCKS ARE TRADING DOWN AND THE DOW AND S&P ARE TRYING TO GO POSITIVE. >>>AND PLANTS IN MICHIGAN AND AVOIDING A RECESSION, THE WHITE HOUSE IS CONSIDERING A TAX CUT ON PAY ROLLS AND RETAIL ROUNDUP, RETAILERS POSTED MIXED RESULTS IN QUARTERLY EARNINGS. WELCOME TO “ON THE MOVE,” I’M ADAM SHAPIRO. ONE OF THE PLANTS WILL LAYOFF HUNDREDS OF PEOPLE. THE COMPANY IS TAKING HITS FROM LOW STEAL PRICES AT RISK DEMAND. I’M THINKING BACK, OVER 3 YEARS AGO THAT THE ADMINISTRATION IMPOSED TARIFFS ON STEEL AND ALUMINUM AND IT GAVE IT A BOOST BUT WHAT’S HAPPENING NOW. >>WE HAD TWO CONSECUTIVE QUARTERS IN THE LAST SEVERAL MONTHS IN OUTPUT AND MANUFACTURING. THAT’S A MANUFACTURING RECESSION, IT’S NOT A US RECESSION, THAT COULD BE DUE TO FACTORS SPECIFIC TO MANUFACTURING. BUT, THE TRUMP TARIFFS ARE NOT HELPING. HE DID SINGLE OUT STEEL AND ALUM NUMBERS THAT HE WANTS TO PROTECT IN 2018, THAT DID HELP A LITTLE BIT. THE PROBLEM WITH THE TARIFFS IS, WHAT YOU HELP OVER HERE, YOU LETTER OVER HERE. SO COMING BACK AROUND, THE MANUFACTURING OF AUTOMOBILES, IT HURTS AND HELPS IT. >>I WANT YOUR REACTION TO THIS, WE’LL PLAY A SOUND BITE FROM THINGS, I DON’T SEE A RECESSION, THE WORLD IS IN A RECESSION RIGHT NOW, ALTHOUGH THAT’S TOO BIG OF A STATEMENT. IF YOU LOOK AT CHINA, CHINA IS DOING VERY, VERY POORLY. THEY HAD A REPORT, THEY’VE HAD THE WORST YEAR THEY’VE HAD IN 27 YEARS BECAUSE OF WHAT I’VE DONE, AND THEY WANT TO COME TO THE NEGOTIATING TABLE. YOU KNOW, THEY’RE HAVING COMPANIES LOSE, I MEAN THEY’RE LEAVING, THE COMPANIES ARE LEAVING AND THEY’RE LAYING OFF MILLIONS OF PEOPLE BECAUSE THEY DON’T WANT TO PAY 25%. >>WHERE DO YOU WANT TO BEGIN? >>YEAH, EXACTLY. WHEN IT COMES TO — I’LL START WITH THE GLOBAL ECONOMIC SLOW DOWN. ON THAT POINT PRESIDENT TRUMP IS RIGHT, THEY’RE FACING SIGNIFICANT CHALLENGES, THE MAJOR END OF THE EURO ZONE. >>THEY’RE FACING IT. THEY’RE NOT THERE. >>THEY’RE NOT A RECESSION YET. THEY SAW THEIR ECONOMY TO SHRINK IN THE SECOND QUARTER AND THE NEXT QUARTER WOULD SHRINK IN. THE EURO ZONE IS SLOWING DOWN. WHEN IT COMES TO THE US, THE REASON THERE ARE FEARS OF A RECESSION IS WHAT’S HAPPENING TO THE YIELD CURVE, HE SAYS THERE’S NOTHING TO WORRY ABOUT, AND HE SAYS BUT PRIVATELY HE’S CONCERNED. AND HE’S TALKING UP THE ECONOMY. >>THE PHONE CALL WITH THE PRESIDENTS AND THE HEADS OF THE BANK. WHEN WE TALK IN THE REAL WORLD, WE HAD A FARMER ON THE PROGRAM, FARMERS ARE PUTTING OFF BUYING CAPITOL EQUIPMENT BECAUSE OF FARMING AND WHAT IS GOING ON THE OTHER WAYS. >>PEOPLE ARE GETTING HIT TWICE, THE INPUT COSTS ARE GOING OUT AND THEIR CUSTOMERS ARE IN FINANCIAL STRESS, THE úJ >>THE JOHN DEERE EARNINGS MISSED. THE STEEL TARIFFS, THEY WERE POSITIVE, BUT NOW COME BACK TO HAUNT. THEY’RE HAVING TO PAY MORE FOR STEEL, JOHN DEERE IS AND FARMERS CAN’T BUY EQUIPMENT BECAUSE OF THE TARIFFS CUT NOT GUILTY CORN AND THE IMPORTS. >>HIS POLICY IS INCOHERENT. HE THINKS HE CAN HELP THIS SEGMENT AND HURT THAT ONE. TO HEAR HIM BRAG HURTING THE CHINESE ECONOMY, IT SHOWS IGNORANCE OF HOW IT WORKS. WHEN YOU HURT AN ECONOMY THAT HAPPENS TO BE A TRADING PARTNER, HURTING THEM HURTS US. IT MAY ACTUALLY HURT US, THE TABSES ON AMERICAN CONSUMERS AND BUSINESSES, THEY’RE WHAT IS HURTING THE ECONOMY. TRUMP IS DOING THINGS THAT HURT US DIRECTLY AND HURT US INDIRECTLY, IT’S NO WONDER HE’S WORRIED ABOUT AT THAT RECESSION. HE’S WORKING AT THE WRONG CAUSES. IT’S NOT THE FEDERAL RESERVE CAUSING A SLOW DOWN. IT’S NOT THE FED CAUSING A SLOWDOWN, IT’S PRESIDENT TRUMP’S OWN POLICIES. >>LET’S HEAD TO THE NEW YORK STOCK EXCHANGE AND ARE WE ON POSITIVE YET? >>WE’RE ON THE DOW, IT’S AROUND THE FLAT LINE, IT’S OFF 7 POINTS, IT’S BEING LIFTED UP BY HOME DEPOT AND THEIR EARNINGS REPORT. APPLE IS UP 1% RIGHT NOW. WE’RE LOOKING THIS MORNING AT SEREPTA THERAPEUTICS AFTER THE F.D.A. DENIED APPROVAL FOR ONE OF THEIR DRUGS, A MUSCLE WASTING DISEASE DRUG. IT WAS A SURPRISE FOR WALL STREET. SOME ANALYSTS SLASHED THE TARGET ON THAT STOCK. AND METRONICS IS UP 4%, BEAT ON THE TO AND BOTTOM LINE, RAISING THE PROFIT GUIDANCE FOR FISCAL 2020. THEY EXPECT TO SEE INVESTMENTS THEY MADE IN THE PIPELINE TO START PAYING OFF. THE DOW IS FLAT AND THE S&P AND NASDAQ IS LOWER. YOU HAVE CONSUMER, ENERGY AND STAPLES. >>IF WE’RE FACING A DECLINE IN THE UNITED STATES, ONE WAY THE ECONOMY HAS JUICED THE ECONOMY IS PUTTING MONEY IN OUR POCKETS THROUGH TAX CUTS. STEVEN IS HERE, ONE OF THE THINGS GETTING DISCUSSION RIGHT NOW, THE WASHINGTON POST SPOKE TO THIS AFTER SPEAKING TO UNIDENTIFIED SOURCES IN THE ADMINISTRATION. THEY’RE LOOKING AT THE REPEAT IN PAYROLL TAXES, THIS IS WHAT HAPPENED IN 2011 AND 2012. IS IT A GOOD IDEA, WHY OR WHY NOT. >>WELL, ADAM WE DON’T THINK IT’S A GOOD IDEA. BASICALLY THESE ARE PROGRAMS THAT ARE FACING HEAD WINDS AND TROUBLES. YOU’RE EITHER GOING TO REDUCE THE AMOUNT OF REVENUE GOING INTO SOCIAL SECURITY, AND MEDICARE OR YOU’RE GOING TO KEEP THEM WHOLE BY TAKING MONEY FROM THE GENERAL TREASURY AND BACK FILLING IT IN AS WAS DONE IN 2011 AND 2012. EACH YEAR THAT PAYROLL TAX CUT COSTS 100 BILLION IN REVENUE, IT’S MONEY IN PEOPLE’S POCKETS, IT’S MONEY NOT GOING INTO THE TREASURY AND WE’RE FACING INTERESTED DEFICITS, IF PRESIDENT TRUMP DECIDES WE NEED A STIMULUS, WHAT IS THE BEST STIMULUS TO PURSUE HERE? >>YOUR PANELISTS ARE TALKING ABOUT, WE SHOULD LOOK AT THE TARIFFS THAT ARE DESTABILIZING THE ECONOMY. THESE ARE THE ISSUES AND PROBLEMS THAT ARE FACING THE ECONOMY. WE HAVE TO LOOK BACK AT THE 2017 TAX CUT. TO SOME EXTENT THE THING THAT IS LIMITING SOME OF OUR ABILITY TO DEAL WITH THE POTENTIAL RECESSION OR SLOW DOWN IS BECAUSE WE’VE REDUCED THE REVENUES AND INCREASED THE SPENDING THROUGH THE BUDGET DEALS. >>>ARE PAYROLL TAX CUTS OFF THE TABLE. THE REPORTS CAME OUT AND THE WHITE HOUSE IS DENYING IT, ISN’T IT THAT THEY DON’T WANT TO LOSE FACE BECAUSE DEMOCRATS WOULD ACTUALLY APPROVE A MEASURE LIKE THAT? >>IT IS. PART OF THE REASON YOU GO THIS, THIS IS SOMETHING THAT DEMOCRATS HAVE SUPPORTED IN THE PAST. IT WAS PRESIDENT OBAMA WHO WAS PUSHING THE PAYROLL TAX CUTS IN 2011 AND 2012. BUT, THAT WAS ALSO, WE WERE COMING OUT OF THE GREAT RECESSION, IT WAS TRYING TO GET CONSUMER SPENDING GOING. RIGHT NOW CONSUMER SPENDING IS WHAT IS BOLSTERING THE ECONOMY AND THEY’RE TRYING TO DEAL WITH THAT WHEN REALITY WE HAVE THE TRADE WAR AND THE DESTABILIZING IMPACT OF THAT. >>>WHEN YOU HEAR THESE REPORTS OUT OF THE WASHINGTON POST AND OTHER ORGANIZATIONS, WHEN YOU HEAR THESE REPORTS THEY’RE LOOKING AT THAT, WHAT IS IT TELLING YOU THAT THE ADMINISTRATION IS TRYING TO ACHIEVE? >>THEY’RE TRYING TO FIGURE OUT SOMETHING OUT TO GOOSE THE ECONOMY AND THIS ADMINISTRATION ROUTINELY THROWS STUFF AGAINST THE WALL TO SEE WHAT STICKS. SO, THIS CAME OUT, WHO KNOWS WHETHER THIS WILL BE AN ISSUE TOMORROW, NEXT WEEK, NEXT MONTH. WE DON’T REALLY KNOW, BUT IT’S JUST BASICALLY ANOTHER SORT OF GRASPING AT STRAWS TO DEAL WITH THE ECONOMY AND BOLSTER IT THROUGH THE 2020 ELECTION. >>IN TERMS OF THE POLITICAL ENVIRONMENT IN WASHINGTON, LET’S SAY PRESIDENT TRUMP PROPOSES A TAX CUT FOR PAYROLL, SIMILAR TO THE ONE PRESIDENT OBAMA SIGNED OFF IN 2011, THAT WOULD PUT DEMOCRATS IN THE POSITION, THEY SUPPORTED THIS BEFORE, SO NATURALLY THEY WOULD SUPPORT THIS AGAIN, IT WOULD BE COMING INTO AN ELECTION YEAR, HOW WOULD THAT PLAY OUT POLITICALLY WITH DEMOCRATS? >>YOU KNOW, IT’S GOOD QUESTION, AND IT’S HARD TO TELL EXACTLY, YOU KNOW WE’RE IN A DIFFERENT SORT OF DEFICIT SITUATION. RIGHT NOW WHERE WE’VE — LAST MONTH THIS BECAME THE LONGEST ECONOMIC EXPANSION IN OUR COUNTRY HE’S HISTORY. IT’S A WEIRD TIME TO BE DOING THE PAYROLL TAX CUT. IT DEPENDS ON HOW THE DEMOCRATS WANT TO PLAY IT. I THINK THEY’LL CONTINUE TO POINT OUTER THE 2017 TAX BILL AND, IN FACT, THAT IT WAS A DEFICIT FINANCE CUT DURING A TIME OF ECONOMIC GROWTH. >>STEVE, THE LAST QUESTION THAT WE GET TO ASK YOU, IS THERE A TIPPING POINT, BECAUSE I HAVE SPENT MOST OF MY ADULT LIFE HEARING THE CONCERNS ABOUT THE NATIONAL DEBT, WAITING FOR THAT TIPPING POINT IT HAS NOT YET ARRIVED. >>WELL, PEOPLE CONTINUE TO LOAN US MONEY, AND AS LONG AS THE US CAN BORROW, THEN THEY CAN CONTINUE DOWN THIS ROAD. WHAT REALLY, BUDGET HAWKS LIKE MYSELF, WHAT WE’RE HOPING IS TO SHRINK THE DEFICIT ND THE DEBT AS A PERCENTAGE OF GDP, WE’RE NOT TALKING ABOUT BALANCING THE BUDGET AT THIS POINT. IT BECOMES A BIGGER CONCERN AS YOU START SEEING NET INTEREST, THE AMOUNT WE PAY TO SERVICE THAT DEBT, WE SEE IT GOING UP AND UP, THE LATER PART OF 2020s, IT’S GOING TO EXCEED NATIONAL DEFENSE SPENDING, THAT’S MONEY WE’RE PAYING TO LIVE IN THIS DEBT. WE’RE GETTING TO THAT TIPPING POINT, WHERE IT IS, I CAN’T TELL YOU. >>FOR CONTEXT, NATIONAL DEFENSE IS OVER 700 BILLION. I HAVE TO LET YOU GO AT THIS POINT. STEVE ELLIS, A TRUSTEDSOURCE, WE APPRECIATE YOU BEING HERE “ON THE MOVE.” >>>BIG NEWS REPORTING EARNINGS, T.J. MAXX AND TWO OTHERS MISSED SALES. LET’S START WITH HOME DEPOT. THE COMPANY REPORTED A SURPRISED SALES MISS, IT GREW BUT IT MISSED WHAT WALL STREET WAS EXPECTING. >>ONE OF THE CONCERNS WITH HOME DEPOT, IT’S THE CONCERN OF LUMBER PRICE DEFLATION, IT COMPRISES 8% OF THE INCOME FOR HOME DEPOT. IT’S STILL A LARGE BUSINESS THOUGH. THEY REITERATED THEIR EARNINGS GUIDANCE. THEY’RE STILL SEEING PRESSURE ON THE LUMBER PRICES. THE COMMODITY MARKET ALL OVER RIGHT NOW IS WEIGHING HEAVY ON THE COMPANY. WE SAW IT FOR LOWERED GUIDANCE AND SAME STORE GUIDE ONCE FOR THE YEAR. IT’S ADDING A LITTLE BIT OF A CUSHION TO ECONOMIC SPENDING AND TARIFFS. >>LET’S TURN IT TO KOHL, IT ANNOUNCED THE PARTNERSHIP TO AMAZON, IS IT HELPING THEM? >>A MISS ON THE TOP LINE, IT’S A BEAT ON THE BOTTOM LINE. IT DIDN’T ROLL OUT UNTIL THE SUMMER. SO, THAT’S SOMETHING THAT THE CEO SAID IT WILL HELP THE COMPANY IN TERMS OF FOOT TRAFFIC. WE’LL HAVE TO SEE IF THAT PLAYS OUT IN THE SECOND HALF 6 THE YEAR. >>>ANY SURPRISES FROM T.J. MAXX? >>WE’RE SEEING A LITTLE BIT OF A MACY’S EASE EFFECT THERE. THE INVENTORY WAS UP 13% YEAR OVER YEAR. WHEN YOU’RE A RETAILER YOU DON’T WANT TO SEE THE BACKLOG, YOU WANT TO MOVE THROUGH ESPECIALLY WITH THE BACK-TO- SCHOOL SEASON. ONE OF THE BRIGHT SPOTS, THEY HAD CUSTOMER TRAFFIC INCREASE IN THE NEXT QUARTER. THIS IS A TESTAMENT TO THE STRENGTH OF THE CONSUMER AND THAT KIND OF STORE AND THE CONSUMERS THEY’RE ABLE TO BRING IN. THAT DOES BODE WELL FOR T.J. MAXX IN THE FUTURE. >>>WE WE ZEROED ON THE MEETING. >>WE HAD THE CEO OF THE AMERICAN FOOTWEAR ASSOCIATION, HE DIDN’T DO US FAVORS. 77% OF SHOES, CLOTHES, AND STUFF YOU BUY FOR YOUR HOUSE, STUFF YOU CAN GET AT HOME DEPOT, 77% OF THAT IS STILL GOING TO BE TARIFFS. THAT’S WHAT I’M PAYING ATTENTION TO, WHAT’S GOING TO HAPPEN COME SEPTEMBER 1ST AND THE EFFECT ON CONSUMER SPENDING IN THE ECONOMY. >>TRUMP CAN BACK OUT OF THE TARIFFS, HE’S DONE THAT WITH MEXICO AND 59% TARIFFS, HE’S SPOOKED BY THE EFFECT OF HIS OWN POLICY HAS LIKELY TO HAVE. WE SAW EXPECTED RETAILS SALES IN JUMP. WE TALKED ABOUT AS EXPECTED. ONE ECONOMIST HAD AN EXPECTATION FOR RETAIL SALES, ARE THESE NUMBERS CONSISTENT OR NOT CONSISTENT. >>THEY’RE NOT CONSISTENT WHEN YOU LOOK ACROSS DIFFERENT VERTICALS OF RETAIL. LOOK AT WAL-MART. THEY BEAT EXPECTATIONS, THAT WAS IN LINE WITH THE RETAIL SALES WE SAW. AND YOU LOOK AT AMAZON PRIME, THEY’RE DRIVEN BY THE NONBRICK AND MORTAR SALES. YOU HAVE A COMPANY LIKE WAL- MART OR AMAZON, IT HAS A STRONG DIGITAL CHANNEL. THESE ARE COMPANIES THAT WILL CONTINUE TO SUCCEED. IT HAS TO DO WITH A SHIFT OVERALL AND SECULAR TRENDS IN THE ECONOMY. >>WHEN YOU TALK ABOUT COMMODITIES FALLING IN PRICE, THAT MAY BE BAD FOR CORPORATE CONSUMERS, IS THAT RIGHT. >>IT’S SOMETHING THAT COMPANIES HAVE TO OFFSET WHEN IT COMES TO THE BOTTOM LINE. IT WILL TRICKLE DOWN. >>YOU’RE MENTIONING WAL-MART AND AMAZON, THEY’RE THE WINNERS IN THIS GAME. MACY’S AND JC PENNY THEY CAN’T RIDE THAT WAY. >>I’LL GET — LOOK HE’S NOT A BIG FAN OF MACY’S, THE DIVIDEND YIELD IS 10%. IT’S ON I CAN’T HUGH FINANCE.COM. THEIR DIVIDEND YIELD IS GINORMOUS AND DOESN’T MAKE SENSE. >>>AND WHO IS COMPETING WITH THE BIG MOUSE. WHY TECH GIANTS MIGHT BE GETTING SUBPOENAS NEXT MONTH. >>>SO THE DOW IS IN DANGER OF SNAPPING A 3 DAY WINNING STREAK AND WHAT ARE YOU WATCHING FOR US? >>THE DOW JUST BARELY CLIMBING INTO THE GREEN AND IN DANGER OF SNAPPING THAT WINNING STREAK AND THE S&P 500 UNDER THE CHANGE RIGHT NOW. WE CAN SEE THE INTRADAY PRICE ACTION. WE’VE CLIMBED INTO THE GREEN A LITTLE BIT. WE’LL GO TO A TWO MONTH CANDLESTICK CHART. WE HAVE THIS W BOTTOM, WE CAN DRAW IT HERE, WE’RE AT THE UPPER END OF IT. IF WE TAKE A LOOK AT WHERE THE PRICE ACTION IS, WE HAVE MOVING AVERAGES JUST ABOVE, WE HAVE RESISTANT LEVEL THAT WE ARE SEEING. IF WE CLIMB ABOVE 295 WE WOULD HAVE A SHOT AT RECORD HIGHS, LOOK AT THE DOWN DRAFTS, IT SEEMS IMPROBABLE. IF WE SELL OFF RIGHT HERE, WE’LL TEST THESE LOWS AROUND 2820, WE COULD HEAD BELOW THAT. WE’LL HAVE TO SEE HOW IT PLAYS OUT. AS WE HEAD TO THE END OF AUGUST, LET’S BRING UP A QUANTITY STRATEGIST, WE CALL HIM DR. MARKET. HE BRINGS OUT THE FACT THAT BONDS HAVE OUTPERFORMED TO A HIGH DEGREE. THE T NOTE IS DOWN 40 BASIS POINTS FOR THE MONTH OF AUGUST. WHEN YOU HAVE THIS OUTPERFORMANCE BY BONDS, YIELDS ARE DOWN, YOU HAVE A ROTATION BACK INTO EQUITIES AT THE END OF THE MONTH. THAT COULD SUPPORT THE MARKET IF WE HAVE ANOTHER DOWN DRAFT. HE’S EXPECTING PERFORMANCES OF EQUITIES 2%. THIS HAS BEEN HEADING HIGHER, WE HAVE THIS TREND, AGAIN GOING BACK TWO MONTHS, WE CAN SEE IT’S BEEN UP FOR THE LAST SIX DAYS IN A OH, THIS IS A MULTIYEAR HIGH WE’RE LOOKING AT RIGHT HERE, AS I’VE BEEN SAYING IN THE LAST TWO DAYS, IT INVOLVES NATIONALS AND PRESIDENT TRUMP DOESN’T LIKE A STRONGER US DOLLAR. WE HAVE TO SEE IF THIS HEADS HIGHER. THIS IS THE U.S. DOLLAR AND THE BLOOMBERG DOLLAR INDEX IS AT HIGHS RIGHT NOW. THIS IS BIDU, IT REPORTED EARNINGS AFTER THE BELL, IT’S UP THE MOST AND NETFLIX IS DOWN THE MOST AND CHIP STOCKS ARE DOWN AS WELL. THEY’RE UNDER A LITTLE PRESSURE TODAY. >>YOU HAD ME AT DR. MARKET, IF HE’S RIGHT AT 2%, I’LL TAKE IT. THANK YOU VERY MUCH. >>>AND THE NEXT GUESTS BELIEVES IN THE U.S. ECONOMY, IN THE WORST-CASE SCENARIO, HE BELIEVES THE US WILL BE OKAY. >>THE U.S. ECONOMY IS STRONG. WE HAVE A HOPELESS BIFURCATION IN ECONOMIC GROWTH. THE U.S. ECONOMY IS STRONG AND THE REST OF THE WORLD IS NOT. THE REST ARE MORE DEPENDENT ON TRADE THAN THE U.S. IS, WE’RE SEEING THE MANUFACTURING AND SERVICE SECTOR, THE GOOD NEWS IS THE U.S. ECONOMY IS A SERVICE SECTOR COMMUNITY. U.S. CONSUMER DOMINATES THE ECONOMY TO THE TUNE OF 70% AND EVERY METRICAL — METRICAL GAUGE SHOWS THAT IT’S OKAY. WE’RE SLOWING BUT NOT NEARLY AT THE PLACE THAT ECONOMIES OUTSIDE OF THE US ARE SLOWING, SO, I THINK THIS BODES WELL FOR THE US. >>>RICK NEWMAN IN THE STUDIO. WHAT YOU’RE SAYING IS ALONG THE LINES OF WHAT MOST ECONOMISTS ARE SAYING. THEY’RE PREDICTING GROWTH OF 2% IN THE UNITED STATES. DO YOU AGREE WITH THAT? AND THERE IS ALSO A GLOBAL SLOW DOWN, TO WHAT EFFECT COULD THE GLOBAL SLOW DOWN ACTUALLY WEAKEN THE U.S. ECONOMY? >>YES, THIS IS THE DILEMMA FOR THE FED, TO WHAT EXTENT, IS IT BASED ON DOMESTIC GROWTH DYNAMICS, HOW MUCH DO YOU CATER TO THE CONTAINING ON, 2% SOUNDS ABOUT RIGHT. IT’S A NOTCH BETWEEN THE 3.1% THAT WAS POSTED IN THE FIRST QUARTER, ADMITTEDLY A SLOWDOWN. HERE’S THE GRINCHER, A LOT OF RESEARCH IS NOW BEGINNING TO SHOW IN A IF THE GLOBAL TRADE WAR ESCALATES IN THE WORST POSSIBLE MANNER AND THAT INCLUDES THEN, NOT JUST THE 10% TARIFF ON EVERY SINGLE GOOD, THAT GOT MODIFIED, IF IT GETS RATCHETED UP TO 25% AND ACCOMPANIED BY EQUITY MARKET WEAKNESS, THE IMPACT OF GDP, IT’S DOMINATED AND ESTIMATED TO BE LESS THAN 1%. IF WE’RE CHUGGING AROUND RAT 2% AND YOU CUT THAT IN HALF, IN THE WORST-CASE SCENARIO THAT TAKES GROSS DOWN TO 1% WITH SY HANDEDLY NORTH OF 0. >>I WANT TO TALK ABOUT THE PRESSURE PRESIDENT TRUMP IS PUTTING ON THE FED TO CUT INTEREST RATES. IN EUROPE THEY’VE HAD EUROPEAN NATIONS THAT HAVE KEPT NEGATIVE INTEREST RATES, WE’RE SEEING THE ECONOMY SLOW DOWN AND GERMANY’S ECONOMY IS SHRINKING, WILL THIS STIMULATE THE U.S. ECONOMY? >>NO, IT’S BEEN FEARED THAT MONETARY POLICY HAS BEEN RUNNING ITS COURSE. IT’S AKIN TO PUSHING BE A STRING. AT THE MARGIN, I THINK POWELL WILL WALK BACK THE REFERENCE TO THE MID CYCLE ADJUSTMENT THAT SOUNDED SUSPICIOUSLY LIKE ONE AND DONE. THERE WILL BE AN EXTENSION OF CUTS. HE SHOULD BE ABLE TO SIGNAL THAT AT JACK SHOWN HOLE THIS TIME AROUND. SO, YOU’RE RIGHT WITH THE AMMUNITION THAT WE HAVE AVAILABLE ON THE MONETARY FRONT. IT’S QUICKLY GETTING DEPLETED. I THINK A PERMANENT AND SECULAR FIT TO THE WHOLE GLOBE. I’M NOT OPTIMISTIC IF WE WILL GET, IT’S A DIFFICULT UNION TO GOVERN AND TO MAKE PROGRESS ON. >>ALL RIGHT. GOOD TO HAVE YOU BACK “ON THE MOVE.” >>LIKEWISE. >>>COMING UP, THE PRIME MINISTER WILL RESIGN TODAY, DON’T MISS US THE COVERAGE OF THE SYMPOSIUM LIVE FROM JACKSON HOLE THURSDAY AND FRIDAY. BRIAN CHEUNG IS THERE. WE’LL BE RIGHT BACK. >>>WE’RE COMING UP TO 11:30, TWO HOURS IN THE TRADING DAY. THE DOW WAS POSITIVE A LITTLE BIT AND FALLEN BACK INTO NEGATIVE TERRITORY BARELY. SAME WITH THE NASDAQ, WE’RE WATCHING IT. OIL HAS BEEN TRADING DOWN FOR MOST OF THE MORNING AND CONTINUES ON THE TRAJECTORY SOUTH. $55.80 A BARREL. >>>LOST IN HONG KONG, A GROWING CONCERN THAT A BRITISH CONSULATE STAFFER HAS BEEN TAKEN IN BY THE CHINESE GOVERNMENT. >>>APPLE IS GOING TO SPEND $6 BILLION TO PRODUCE ORIGINAL CONTENT FOR ITS STREAMING SERVICE. >>>TWITTER TAKES ON CHINA AND THE SOCIAL NETWORK TAKES ON STATE SPONSORED FAKE NEWS. >>>AND THE ITALIAN SENATE WAS TOLD THAT THERE WILL BE A RESIGNATION TODAY. DID THIS SURPRISE ANYBODY? >>WELL, THIS HASN’T COME AS A SURPRISE. MATTEO SALVENI HAS BEEN CALLING FOR FRESH ELECTIONS AFTER FALLING OUT WITH CONTE RECENTLY. HE’S THE INTERIOR MINISTER, HE WAS BROUGHT IN LAST YEARS. HE’S BEEN RULING THE GOVERNMENT SINCE JUNE 2018. HE WAS BROUGHT IN REALLY TO BRING THE WARRING FACTIONS TOGETHER IN THE COALITION GOVERNMENT. HE HASN’T BEEN ABLE TO DO THAT CLEARLY. HE BLASTED SALVENI THE FIVE STAR LEADER FOR THE COLLAPSE TODAY. THEY SAID HE CARED ONLY ABOUT HIS OWN INTERESTS AND HIS OWN POLITICAL PARTY. THIS COULD BRING UP FRESH PROBLEMS IN ITALY, AND WE’RE NOT SURE WHAT THEY SIGNED UP FOR. THE COUNTRY ANNOUNCED HIS INTENTION TO RESIGN. THE STAGES ARE NOT CLEAR AT THIS MOMENT. THAT IS CREATING A LOT OF UNCERTAINTY IN THE MARKETS, BETH THE ITALIAN MLB AND GERMANY AND FRANCE, IT’S TANKED BECAUSE THIS IS NEWS THEY DON’T NEED. >>ITALIAN GOVERNMENTS FALL FASTER THAN PROM CLOTHING, WHY ARE THE EUROPEAN MARKETS ACTING THIS WAY. THIS IS ALMOST A CON STAT. >>I THINK THEY’RE FALLING BECAUSE UNCERTAINTY, EVEN IF YOU THINK GOVERNMENTS FALL A LOT, YOU WANT CERTAINTY OVER UNCERTAINTY. FRESH ELECTION COST GIVE SALVENI AND THE POPULACE MORE POWER. IT WOULD MEAN MORE ANTIEUROPEAN SENTIMENT AND MORE TO THE EU THAT HAS THE THEY OF “BREXIT” AND THAT’S WHY WE’RE SEEING THE SELL OFF. >>AN EMBASSY STAFFER WAS DETAINED IN CHINA REPEATEDLY. >>THIS IS SIMON CHANG WORKS IN HONG KONG FOR THE BRITISH CONSULATE. HE HAS A BRITISH PASSPORT AND HE LEFT TO GO TO A CONFERENCE, BUT HE HASN’T COME BACK. REPORTS EMERGE TODAY THAT HE HAS POTENTIALLY BEEN DETAINED BY THE CHINESE STATE. WHY EXACTLY? IT’S NOT CLEAR. THE FT REPORTED HE MAY HAVE TAKEN PART IN PRO-DEMOCRACY PROTESTS IN HONG KONG ALTHOUGH HIS GIRLFRIEND DENIES IT. THE FOREIGN OFFICE IN BRITAIN ARE CONCERNED ABOUT THESE REPORTS AND ARE SEEKING MORE INFORMATION. >>>WE’LL TURN OUR ATTENTION TO DISNEY. MICKEY MOUSE WILL HAVE STIFF COMPETITION IN THE STREAMING WORLD THIS FALL. APPLE WILL HAVE THE APPLE TV PLUS SERVICE IN NOVEMBER. THE SUBSCRIPTION VIDEO SERVICE WILL COME AT THE SAME TIME AS THE DISNEY PLUS SERVICE. >>>DAN ROBERTS IS IN THE NEWSROOM WITH MORE DETAILS. THERE’S ENOUGH SPACE FOR BOTH? >>YES, NOVEMBER, NOVEMBER, NOVEMBER, IT’S ABOUT ALL OF THE NEW LAUNCHES, IT IS NOT TO MENTION THE HBO AND UNIVERSAL. THEY PAID TO GET THE OFFICE BACK. EVEN MORE TO COME, I’M WITH YOU, I THINK PEOPLE ARE FRAMING AND SAYS, DISNEY PLUS AND APPLE TV PLUS ARE GETTING IT WRONG. RECENT STUDIES HAVE INDICATED, THEY’RE IN AN ERA WHERE THEY’RE GOING TO ADD MORE OTT DISCUSSIONS THAN CUTS, WE’LL HIT THE POINT WHERE PEOPLE REALIZE I’M SPENDING MORE MONEY ON THESE CHANNELS RATHER THAN CABLE. THEY’RE WILLING TO ADD 6.99. THEY’RE CUTTING NETFLIX SO MUCH. APPLE REPORTEDLY WILL BE $9.99. THEY’RE SPENDING 6 BILLION FOR APPLE TV PLUS. >>DAN, I WANT TO TALK TO YOU ABOUT THAT $6 BILLION THAT APPLE IS ALLEGEDLY SPENDING. THERE WAS AN ARTICLE THAT TALKED ABOUT THIS A NEW SHOW, IT WILL BE A MORNING NEWSROOM COMEDY. THESE SHOWS FAIL ALL OF THE TIME. I’VE SEEN THEM COME AND GO, THE ONLY ONE WAS MARY TYLER MOORE AND THAT’S NOT IN RERUNS NOW. REESE WITHERSPOON, I LOVE HER, SHE’S GREAT, BUT THEY’LL SPEND MORE ON THAT THAN THE “GAME OF THRONES.” SOMEONE HAS TO SAY TO TIM COOK, THIS IS HOW YOU DO IT OR AM I WRONG? >>WE’LL PASS ALONG YOUR THOUGHTS. YOU’RE RIGHT, THIS IS HOW IT WORKS WHEN YOU LAUNCH AN ORIGINAL CONTENT PLATFORM. YOU HAVE TO SPEND MONEY AND THROW MONEY AT THE WALL AND SEE WHAT STICKS. WE CAN SAY OH, WHAT A HIT, THERE’S A TON THAT PEOPLE DON’T WATCH. YOU EXPECT SOME OF THAT RUN OFF. SO, THIS SHORE ABOUT THE MORNING SHOW, YOU’RE RIGHT ABOUT THAT SHOW. A LOT OF PEOPLE ARE ADMITTING THE TRAILER LOOKS GOOD, IT MIGHT BE A GOOD SHOW. $6BILLION. THAT’S NOT ON THIS ONE SHOW. THERE ARE A NUMBER OF ORIGINAL SHOWS ON THE PLATFORM. WILL THEY BE HILT. CERTAINLY IN THE. APPLE LAS AN ELECTRONIC TRACK RECORD OF ROLLING OUT NEW THINGS. PEOPLE WILL SAY, IT WON’T DO WELL AND SUDDENLY IT DOESN’T DO WELL. LOOK AT APPLE MUSIC. NO, THERE’S SPOTIFY, THEY’RE NECK IN NECK. THE APPLE SUBSCRIPTIONS PASSED SPOTIFY, THEY BETTER BE BETTER. THE $12,000 ISSUE OF APPLE TV, THE CONTROL IS A PAIN IN THE NECK TO USE. IF THEY DON’T FIX THAT NOW, GOOD LUCK WITH THAT. >>>A BIPARTISAN GROUP IS TRYING TO MOVE AN ANTITRUST SUIT. THEY ARE GOING TO COURT NEXT MONTH OF AND WE’LL DISCUSS THIS AND TECH TALK TOPICS THAT ARE GETTING ATTACK. SHOULD THE BIG TECH COMPANIES WORRY ABOUT THE ATTORNEY GENERALS COMING FORWARD TO DO THIS. >>A COUPLE OF THEM SHOULD BE CONCERNED, FACEBOOK AND GOOGLE, SHOULD BE AN ADD ON TO WHAT THE FTC AND THE GENERAL TRADE COMMISSION IS DOING, BIPARTISAN SUPPORT FOR TRADE REGULATION AND TECH. AT THE MOST BASIC LEVEL THERE’S GOING TO BE MORE RED TAPE THAT SOME OF THESE COMPANIES WILL HAVE TO GO THROUGH AND ULTIMATELY YOU’RE GOING TO SEE SOME CHANGES TO HOW THEY CAN SHARE DATA OR AT LEAST SOME OF THE NOTIFICATIONS AROUND HIGHWAY YOUR DATA IS BEING SHARED. THAT’S IMPORTANT FOR COMPANIES LIKE FACEBOOK, FOR EXAMPLE, WHICH COULD HAVE A SMALL SHIFT IN TERMS OF THEIR ENGAGEMENT. SO, YES THEY SHOULD BE FOCUSED ON THIS, GOOGLE ON THEIR LAST EARNINGS CALL WAS ASKED THIS QUESTION ABOUT A GREATER REGULATORY ENVIRONMENT, AND THEY LARGELY DISMISSED THE QUESTION SAYING THAT THEY HAVE, FOR A LONG TIME OPERATED IN AN INTENSE REGULATORY ENVIRONMENT, INCLUDING EUROPE AND THAT THIS IS NOTHING KNEW TO THEM. I THINK THIS IS JUST COLLECTIVELY, ARE MARKS A STEP UP IN TERMS OF THE INTENSITY THAT THEY’LL BE SCRUTINIZED. >>PLUS, IT STATES ATTORNEY GENERAL FROM BLUE AND RED STATES. IT’S MOMENTS WHERE BOTH SIDES ARE COMING TOGETHER TO GO AFTER THE SAME TARGET. >>YEAH, EXACTLY. IT’S A RARE MOMENT. IT MAKES FOR A GOOD POLITICKING BECAUSE I THINK THERE’S A GENERAL SENSE ACROSS THE BOARDS FROM BOTH POLITICAL PARTIES THAT THEY CAN USE THIS TOPIC OF KIND OF GREATER TECH TO THEIR ADVANTAGE. >>I DO QUESTION AT THE END OF THE DAY IF CONSUMERS ACTUALLY WANT. THIS STICK WITH ME FOR A MINUTE HERE. IN AN ENVIRONMENT WHERE YOU HAVE GREATER SECURITY AROUND YOUR DATA AND I THINK WHEN PEOPLE HEAR THEIR DATA, THEY THINK IT’S DATA THAT’S VALUABLE TO THEMSELVES, WHEN IN FACT, IT’S MORE VALUABLE TO ADVERTISERS, THERE’S GOING TO BE A COST TO CONSUMERS TO GIVE THIS UP, AND SPECIFICALLY AROUND SOME OF THE FUNCTIONALITIES OF THE PRODUCTS COULD BE DILUTED OR POTENTIALLY SOME PRODUCTS COULD GO AWAY ALL TOGETHER. I JUST WANT TO KEEP THAT IN MIND EVEN THOUGH IT MAKES FOR GOOD POLITICAL TALK POINTS FOR THE REGULATORS. I THINK THAT THE CONSUMER MAY NOT ACTUALLY BE BETTER OFF UNDER THESE ENVIRONMENTS. >>RICK NEWMAN IN NEW YORK. THAT’S BIG DIFFERENCE BETWEEN REGULATORS INVESTIGATING THESE COMPANIES AND REGULATORS IMPOSING SOMETHING AND SUING THEM IN SOME WAY AND SEEKING ACTION. WHICH OF THESE COMPANIES DO YOU THINK IS VULNERABLE TO SOME KIND OF GOVERNMENT ACTION AND WHAT MIGHT THAT ACTION BE? ú>> ME REVERSE THAT ORDER. PROBABLY IN ORDERS OF VULNERABILITY, IF IF FACEBOOK IS AT THE TOP SPECIFICALLY AROUND THE CONSUMER DATA, THAT’S NOT NEW TO THE FACEBOOK PAGE, THEY PAID SOME SORT OF A FINE. THERE’S AN OPEN QUESTION ON HOW THEY SHARE AND NOTIFY PEOPLE HIGHWAY THEY’RE USING DATA. IN GOOGLE’S CASE, THEIR SEARCH BUSINESS, GOOGLE SAYS THE 90% OF THE SEARCH AND IT’S A USER DRIVEN INTENT AND YOU TYPE IN THE WORD YOU’RE SEARCHING FOR, IT’S DIFFERENT THAN SOMEONE SCRAPING THE DATA PRIVACY. THE ISSUE WITH GOOGLE, THEY USE THAT SEARCH DOMINANCE, AND PRODUCTS ARE TIGHTLY IN DIG INTEGRATED, OR GOOGLE MAPS, THAT’S THOSE TWO. APPLE GETS INTO THIS BECAUSE THEY’RE A LARGE TECH COMPANY. THEY BY FAR HAVE THE LEAST RISK TO THIS TOPIC AND AMAZON SOMEWHERE IN BETWEEN. >>THERE WAS DISCUSSION WITH FEDERAL TRADE COMMISSION, SIMMONS, HE TALKED ABOUT BREAKING UP FACEBOOK, AND THE PLANS TO MERGE FACEBOOK INSTAGRAM AND WE KNOW THEY’RE CONDUCTING THE INVESTIGATION AND WHAT DO YOU THINK HE HAD TO SAY? >>I’M IN THE CAMP, I JUST BELIEVE THAT THERE IS ARE BENEFITS TO CONSUMERS, I’M IN THE CAMP THAT SAYS BREAKING THESE COMPANIES UP IS ULTIMATELY NOT IN THE BEST INTERESTS OF CONSUMERS. I DO THINK THAT IS ULTIMATELY WHAT’S GOING TO HAPPEN. THESE COMPANIES WILL NOT BE BROKEN UP, BUT I THINK THAT CONVERSATION WILL GO ON FOR THE BETTER PART OF THE NEXT COUPLE OF YEARS ABOUT THIS TALK OF BREAK UP, BUT I DON’T THINK THAT WILL ACTUALLY COME TO FRUITION. >>>GOOD TO SEE YOU HERE “ON THE MOVE.” >>>COMING UP, JEFFREY EPSTEIN CREATED A TRUST TO PROTECT HIS HALF A BILLION FORTUNE A FEW DAYS BEFORE HE KILLED HIMSELF. >>>PLUS NOTHING CAN PROTECT FLORIDA’S PALM TREES FROM A DISEASE THAT CAUSES THEM TO DRY UP AND DIE. MORE ON FLORIDA’S PLANTS. >>>A EXCUSE SEX TRAFFICKER SIGNED A MULTI-MILLION-DOLLAR WILL, A TRUST WAS CREATED ON AUGUST 8TH. TWO DAYS BEFORE JEFFREY EPSTEIN HUNG HIMSELF. THE WILL IS WORTH 577 MILLION, AND HE LEFT THE FORTUNE TO THE TRUST. THE LAWSUITS BY SOME OF THE VICTIMS MAY PREVENT THE TRANSFER OF WEALTH TO THE TRUST. >>>THE STATE OF TEXT SCATTERED SHOWERS ARRIVING THE LATEST TARGET OF RANSOMWARE ATTACKS. 23 STATE AGENCIES ARE SUFFERING MAJOR COMPUTER FAILURES AND THEY SUSPECT A LOAN HACK CERTIFICATE TO BLAME. THE DAR SAY THIS IS THE THE CLAIMS OF THE MOST CRITICALLY IMPACTED STATES AND RESOURCES AND THEY WON’T SAY WHICH ONES ARE AT RISK. >>>A CHOKE HOLD ATTACK, IT IS ALLEGED KILLED GARNER, AND HE LOST HIS PENSION EVEN THEY THEY DECLINED TO FILE CHARGES AGAINST HIM. THEY RULED THAT HE WAS GUILTY OF VIOLATNG A POLICY WHICH BANS CHOKE HOLDS. >>>A DISEASE IS SPREAD BY A TINY INSECT THAT FEEDS ON THE PALM TREE SAP. IT’S KILLED TENS OF THOUSANDS OF PALM TREES. NURSERIES IN FLORIDA HAVE HAD TO UP ROOT THE DISEASE TO KEEP THE DISEASE FROM SPREADING. IT FIRST APPEARED IN TAMPA AND SPREAD ACROSS THE STATE FROM JACKSONVILLE TO KEY WEST. >>>AND AS THE RACE TO 2020 CONTINUES, ONE HOT TOPIC HAS BEEN MEDICARE FOR ALL. THE CANDIDATE SPOKE OUTRIGHT ON THE HEALTH CARE RULES. >>PEOPLE WHO HAVE HEALTH CARE ON THE MEDICARE FRAUD WILL HAVE NO OUT-OF-POCKET EXPENSES AND DEDUCTIBLES. >>THE QUICKEST FASTEST WAY TO DO IT IS TO BUILD ON OBAMACARE AND WHAT WE DID. >>RAISE YOUR HAND IF YOUR GOVERNMENT MAN WOULD PROVIDE COVERAGE FOR UNDOCUMENTED IMMIGRANTS. >>OKAY. >>WELL, WE HAVE THE CEO, HE’S HERE TO TALK ABOUT MEDICARE FOR ALL AND HOW THIS CAN PLAY OUT AND HIT DIFFERENT INDUSTRIES. YOU CREATE A MONITORING DEVICE FOR PEOPLE IN, GET ME CORRECT ON THIS WHO HAVE HAD A HEART ATTACK OR SOME KIND OF CARDIORELATEDDISH UNION NEED TO MONITOR YOUR HEART? >>THAT’S CORRECT. THANK YOU FOR HAVING ME. WE CREATED AN INTELLIGENT HEART MONITOR, WE CAN DIAGNOSE THEM AND GET THEM OUT OF THE HOSPITAL FASTER AND DIAGNOSE THEM WHETHER SURGICAL OR MEDICINAL. >>MEDICARE WILL COVER THE EXPENSE OF THIS DEVICE FOR MEDICARE OR WHAT ABOUT MEDICAID OR PEOPLE WHO GET THEIR BENEFITS THROUGH THE VA. >>VERY INTERESTING POINT, ONE OF THE THINGS THAT I THINK IS REALLY MISSING IN THIS DISCUSSION AROUND MEDICARE FOR ALL IS PRIVATE, FOR MEDICARE, THERE’S GAPS IN THE SYSTEM. MEDICARE DOES COVERAGE, MEDICAID DOES NOT. VA, IT DEPENDS ON THE STATE, MEDICARE ADMINISTRATORS, DEPENDING ON WHAT STATE YOU’RE IN CHANGES WHAT COVERAGE IS THERE. CONVOLUTED, PRIVATE INSURERS IS NOT WHAT IS THERE. IF MEDICARE IS COVERING IT, THEY MAY NOT COVER IT. SOMETIMES MEDICARE IS PROVIDING BETTER CARE THAN PRIVATE INSURANCE AND VICE VERSA. >>WHAT’S INTERESTING IS YOUR PERSPECTIVE. HERE YOU ARE RUNNING A BUSINESS THAT SEES BOTH SIDES OF THIS. SO HELP US UNDERSTAND WHAT IS BENEFICIAL OR NOT ABOUT THE DEMOCRATS AND THEIR PROPOSAL FOR MEDICARE FOR ALL. RICK NEWMAN IS SITTING NEXT TO ME. 150MILLION AMERICANS ARE NOT GIVING UP PRIVATE HEALTH CARE, WHAT ARE THE DETRIMENTS AND BENEFITS OF MEDICARE FOR ALL, I THINK IT’S AN IMPORTANT TOPIC AND WHETHER IT’S MEDICARE OR PRIVATE, THE FOCUS REALLY SHOULD BE AROUND COST REDUCTION AND STANDARDIZATION OF CARE. THE MEDICARE FOR ALL DEBATE, I DON’T THINK IT’S TAKING THIS ISSUE FRONT AND CENTER, THEY’RE TALKING ABOUT A GENERAL BLANKET, SO COMING IN AS A HEALTH CARE COMPANY, COMING IN WHERE THEY’RE LOOKING AT TECHNOLOGY AND HEALTH CARE AS A MODERN WAY, WE’RE TRYING TO UNDERSTAND HOW DOES THAT AFFECT US. IF YOU TAKE 30% OF OUR POPULATION, YOU’RE TALKING ABOUT INDIVIDUALS LESS THAN 65 AND 70% OF IT IS MEDICARE PATIENTS AND WITHIN MEDICARE, I’VE GOT NO STANDARDIZATION IN CARE, SO DEPENDING ON WHAT I ALLUDED TO EARLIER, NO MATTER WHAT STATE OR PART OF THE UNITED STATES IN WE MAY BE COVERED IN FLORIDA OR TEXAS OR COVERED IN BOTH. DEPENDING N THE ADMINISTRATOR, THE COVERAGE CHANGES, ONE INSURER WILL COVER YOU IN TEXAS AND ANOTHER WILL NOT COVER YOU. THIS STANDARDIZATION IS AFFECTING OUR BUSINESS MORE. YOU TAKE THE OTHER 30% WHO ARE UNDER 65% WHICH ADHERE TO THE PRIVATE INSURANCE. THERE’S NO STANDARDIZATION DEPENDING ON WHAT STATE. CERTAIN PRIVATE INSURERS FIND WHAT MEDICAR IS DOING OR THE POLICY THAT MEDICARE HAS COME UP WITH, THEY AGREE WITH AND WILL COVER IT. OTHER INSURANCE COMPANIES SAY THEY WILL NOT COVER IT. THAT’S AFFECTING US A LOT MORE AS COMPARED TO THE 10% OF THE POPULATION RIGHT NOW UNINSURED WHICH I BELIEVE IS A VERY IMPORTANT TOPIC AS WELL AND SHOULD BE ADDRESSED, AS BUSINESS, THE NONSTANDARDIZATION OF HEALTH CARE AND THE NONSTANDARDIZATION OF CARE ACROSS PRIVATE AND MEDICARE IS A BIG AFFECT TO US. >>THIS IS A COMPLICATED TOPIC TO DISCUSS IN A COUPLE OF MONTHS. THE ISSUE FOR MEDICARE FOREALL, IT PAYS LESS THAN MOST PRIVATE INSURERS AND PRIVATE ORGANIZATION THAT IS COVER CARE, AND THAT WOULD DISRUPT THE KIND OF EVERYTHING ABOUT THE PRIVATE PART OF THE HEALTH CARE INDUSTRY WHERE ALL OF THE CARE IS GIVEN. WHAT IS YOUR DEGREE OF CONCERN ABOUT THAT? >>SO, I BELIEVE THAT THE PRIVATE INSURERS ARE ALWAYS TRYING TO REDUCE THEIR COSTS IN THE LONG TERM. THAT’S THEIR FOCUS AS A BUSINESS AND THEY HAVE AN APPROACH THAT IS TRYING TO MOVE PATIENTS OUT AND THEY WILL BE ABLE TO ACCOMPLISH AND DEAL WITH THIS REDUCTION OF COSTS IF THE INDUSTRY IS DISRUPTED. AT THE END OF THE DAY THE SAME SYSTEMS AND HOSPITALS ARE ABLE TO GIVE CARE AT A HIGHER PRICE. THAT’S WAY TO DO IT IF THERE’S A WAY TO DO T MEDICARE IS SHOWING IT CAN BE DONE AT A LOWER COST. THE PRIVATE INSURERS ARE LOOKING AT THE LONG TERM AND THEIR INVESTING IN TECHNOLOGY, THEY’RE ENABLING AND THEY’RE LOOKING AT NEW WEIGHS AND STRATEGIES TO REDUCE COSTS TO GET PATIENTS TO COME IN EARLIER. AT THE END OF THE DAY, 75% OF DOLLARS, 75 CENTS OF EVERY — SPENT IN THE UNITED STATES ARE ON PATIENTS WITH CHRONIC CONDITIONS. THAT’S THE PROBLEM AND YOU SEE BOTH MEDICARE AND PRIVATE INSURANCE REALLY FOCUSING ON HOW TO DRIVE THE COST DOWN THIS. MOVING THE NEEDLE THERE IS A BIGGER IMPACT THERE RATHER THAN SAYING IS MEDICARE GOING TO DISRUPT PRIVATE INSURANCE. IT’S VERY NIMBLE AND THEY’RE A FOR PROFIT ORGANIZATION AND THEY’LL COME OUT THE OTHER SIDE BECAUSE THEY WILL HAVE BEEN INVESTING IN DATAMINING, WHAT’S GOING ON IN THE HEALTH CARE SYSTEM FOR QUITE SOME TIME. >>HAVE YOU SKIN IN THE GAME AND YOUR PERSPECTIVE IS IMPORTANT, IT’S GOOD TO HAVE YOU HERE. YOU MAKE THOSE DEVICES TO MODERN CARDIOVASCULAR DISEASE. IT’S RESPONSIBLE FOR ONE IN SIX HEALTH CARE DOLLARS IN THE UNITED STATES. THANK YOU FOR BEING HERE. >>THANK YOU. >>>BAYER IS SELLING ITS BUSINESS TO AMERICAN RIVAL. THIS IS BECAUSE OF THE ROUNDUP. >>WE HEARD CONVERSATIONS ABOUT THIS IN THE WORKS. BAYER HAS DIVESTED COPPERTONE AND IT SEEMS LIKE IT’S MOVING AWAY FROM THE CONSUMER BRANDS. IT’S MOVING AWAY FROM OTHER DIVERSE AREAS OF ITS PORTFOLIO IN ORDER TO DEAL WITH THESE LEGAL BILLS AND JUSTIFY ITS MOVE TO TAKE ON MONTANTO FOR 63 BILLION LAST YEAR. THE TOTAL IN AGGREGATE IF YOU INCLUDE COPPERTONE AND DR. SCHOLLS, THE ROUNDUP SETTLEMENT IS ABOUT $20 BILLION. IT’S RIGHT NOW STANDING AT $3 BILLION. THEY’RE DOUBLING DOWN ON THIS IDEA OF BEING A LIFE SCIENCES COMPANY AND JUSTIFYING MONSANTO AS A CROP SCIENTIST, THEY’RE BETTING BIG ON THE CROP SCIENCES. >>>THOSE OF YOU WHO LOVE AIR STREAM MOBILE HOMES, COMING UP HOW RVS MAY BE SIGNALING A WARNING SIGN FOR THE U.S. ECONOMY. >>>THE ART OF THE EXIT, A NEW TRUE CRIME PODCAST THAT TAKES US THROUGH THE NOTORIOUS HEIST. YOU CAN LISTEN TO THE ART OF THE EXIT ON APPLE PODCASTS OR WHEREVER YOU GET THE PODCASTS. >>>TIME FOR A WORD ON THE STREET WHERE WE CHECK IN WITH THE BABBLIST, YOU’RE PAYING CLOSE ATTENTION TO JAY POWELL, THE COMMENTS HE’S GOING TO MAKE AND A NOTE FROM DATA TRACK. >>PEOPLE WILL BE ON PINS AND NEEDLES, THOSE PEOPLE BEING PRESIDENT TRUMP AND MARKET INVESTORS, EVERYONE WILL BE WAITING TO HEAR EVERY WORD OF FEDERAL CHAIRMAN POWELL’S MOUTH. THEY DO THIS CONFERENCE AT JACKSON HOLE. WHAT MARKETS ARE EXPECTING 90% CHANCE OF 25-CENT BASIS POINT IN SEPTEMBER AND ANOTHER 25 BASIS POINT IN OCTOBER AND NORMAL RATE CUTS FOR THE YEAR OR ONE MORE. IT WILL BE INTERESTING TO SEE HOW HE WALKS THAT FINE LINE. LAST TIME FED CHAIR SPOKE, THE OTHER WEEK WE HAD A QUARTER PERCENTAGE POINT CUT AND MARKETS, THAT’S WHAT THEY WANTED AND THEY WEREN’T HAPPY ABOUT IT. WE SAW THE STOCK MARKET TANK. IT WILL BE INTERESTING TO SEE THIS TIME AROUND. >>HE HAS NO PRESSURE, THE PRESIDENT IS NOT ASKING HIM TO DO SOMETHING. >>AND THE PRESIDENT HAS HIS OWN PRESSURE WITH THE TARIFFS. >>AND BRIAN CHEUNG WILL BE AT JACKSON HOLE. >>DO YOU HAVE AN RV. >>NOT UNTIL I HAVE WHITE VINYL SHOES AND I’M RETIRED. I WORKED AT WHSB. >>WHY ARE WE TALKING ABOUT RVS, IN MICHIGAN, WE KNOW THAT RVS ARE AN INDICATOR OF RECESSION. >>THERE ARE SLOWING RV SALES, I DID A STORY ON SOME BUSINESSES IN INDIANA A COUPLE OF YEARS AGO, THEY COULDN’T GET ENOUGH WORKERS, THEY WERE TRYING TO FIND OUT HOW TO GET PEOPLE TO MOVE THERE. IT WAS BELOW 3%, THIS PART OF THE COUNTRY IS SWING CENTRAL. IT’S ONE OF THE MOST CYCLICAL PARTS OF THE COUNTRY. ONE OF THE THINGS WE’RE LOOKING FOR ARE SIGNS OF A DOWNTURN AND SLOWING SALES OF RECREATIONAL VEHICLES WOULD BE ONE OF THEM. WE HAVE SEEN A SLOWDOWN OF AUTO SALES AND OTHER DURABLE GOODS. THIS DIDN’T MEAN A RECESSION IS IMMINENT, THINGS ARE CHANGING. >>USELESS TRIVIA ABOUT THAT PART OF INDIANA, WOMEN HAD HUGE HAIR, WE’RE TALKING ABOUT THE LATE ’80S AND EARLY ’90S, UNIROYAL USED TO BE RIGHT THERE AND STUDEBAKER SOUTH BEND. IT’S THE IRON SIDE ROAD IS THE ROAD. >>SOME HAS BEEN REPURPOSED AND PART OF THE STORY HAS BEEN, IT’S BEEN A MANUFACTURING REVIVAL, IT’S NOT BECAUSE OF WHAT PRESIDENT TRUMP OR PRESIDENT OBAMA DID, IT’S THE WAY THE ECONOMY SWUNG BUT IT MIGHT SWING BACK. >>IF UP PLANNED A BAND HISTORY IT CAME FROM INDIANA, THAT’S WHERE THEY MADE THE INSTRUMENTS. >>AT BAND CAMP. >>>COMING UP MAJOR RETAILERS POSTED RESULTS FOR THE QUARTERLY REPORTS AND HUNDREDS OF PEOPLE ARE LOSING THEIR JOBS AT US STEEL. WE’LL HAVE DETAILS ON THAT FOR U YOU HAVE. YOU. >>>ALL RIGHT. 12O01 IN NEW YORK CITY, 2 AND A HALF YEARS IN THE TRADING DAY. THE DOW HAS FALLEN BACK INTO NEGATIVE TERRITORY. IT’S DOWN 43 POINTS, IT WAS UP, BUT THE NASDAQ AND S&P ARE OFF. THE NASDAQ IS DOWN 10 POINTS. >>>THE TREASURY YIELD IS DOWN AT 1.55%. WE’RE KEEPING AN EYE ON THE TREASURY, WE SAW THE INVERSION AND IT UPSET A LOT OF PEOPLE. HUNDREDS OF LAYOFFS AT ONE OF ITS PLANTS IN MICHIGAN. >>>AVOIDING A RECESSION, THE WHITE HOUSE IS CONSIDERING A TAX CUT ON US PAY ROLLS. >>>AND RETAIL ROUNDUPS, THEY POSED MIXED RESULTS ON THAT. I’M ADAM SHAPIRO, WELCOME TO “ON THE MOVE.” >>>US STEEL IS TAKING HITS FROM LOWER STEEL PRICES AND A DROP IN DEMAND. RICK NEWMAN IS WITH US, AND THE MANAGING DIRECTOR DAVE MAZA IS HERE. WHEN YOU SAW US STEEL WAS GOING TO LAYOFF, TEMPORARY LAYOFFS, WHAT DOES IT SIGNAL TO YOU? >>THE GLOBAL ENVIRONMENT, STEEL, IT’S A DIFFICULT ONE, WE HAVE SEEN MANUFACTURING INDEXES AND OUTPUT AROUND THE GLOBE DECLINE AND THIS HAS BEEN HAPPENING IN EUROPE AND IT’S HAPPENING HERE. STEEL HAS BEEN IMPORTANT TO PRESIDENT TRUMP, HE WENT ON RECORD SAYING HE SAVED THE INDUSTRY. SO, WE’LL SEE WHERE THAT LEADS. >>IT SPEAKING OF THE PRESIDENT, LET’S LET HIM IN HIS OWN WORDS TELL US WHAT’S GOING ON WITH HIS OWN ECONOMY. >>I DON’T SEE A RECESSION, I MEAN THE WORLD IS IN A RECESSION RIGHT NOW. AND ALTHOUGH THAT’S TOO BIG OF A STATEMENT. IF YOU LOOK AT CHINA, IT’S DOING VERY, VERY POORLY. I SAW A REPORT IT’S THE WORST YEAR THEY’VE HAD IN 27 YEARS BECAUSE OF WHAT I’VE DONE AND THEY WANT TO COME TO THE NEGOTIATING TABLE. YOU KNOW THEY’RE HAVING COMPANIES LOSE — I MEAN THEY’RE LEAVING. THE COMPANIES ARE LEAVING AND THEY’RE LAYING OFF MILLIONS OF PEOPLE BECAUSE THEY DON’T WANT TO PAY 25%. >>ALL RIGHT. I’M GOING TO GIVE UP THE FIRST WORD AFTER THAT? >>TARIFF MAN OVER THE WORLD, IT WILL HELP THE UNITED STATES, IT’S HURTING CHINA AND THE UNITED STATES. TO GO BACK TO US STEEL, IT’S A SMALL NUMBER. WE HAVE ADDED, WE HAD A SLOWDOWN IN MANUFACTURING, WE ADDED JOBS IN MANUFACTURING. IT WILL BE INTERESTING TO SEE IF WE SEE JOB LOSSES OVERALL IN MANUFACTURING, IT WILL BE A TURNING SIGN. THE PROBLEM FOR PRESIDENT TRUMP, HE SIGNALLED OUT CERTAIN INDUSTRIES HE WANTED TO HELP WHICH MAKES HIM AN EASY TARGET FOR OPPONENTS, ESPECIALLY DEMOCRATS WHO WILL BE RUNNING AGAINST HIM TO PICK ON NEWS, THESE LITTLE NEWS TIDBITS LIKE ONE SMALL ROUND OF LAYOFFS, SEE YOUR POLICY IS FAILING, I’M NOT SURE YOUR POLICY IS FAILING, úI >>THE TRICKLE DOWN FROM A TARIFF TO A PROBLEM, WE HAD A FARMER ON, WE KNOW JOHN DEERE MISSED, IT’S HAVING — TACK A LISTEN TO WHAT’S GOING ON. >>JOHN DEERE HAD A PRICE INTEREST BECAUSE OF STEEL TARIFFS. THEY’RE GETTING HIT TWICE. THEIR INPUT PRICE ARE GOING UP AND THEIR CUSTOMERS ARE IN FINANCIAL STRESS, THAT NOT GOOD TIMES FOR JOHN DEERE. >>WHY DON’T, WHY DOESN’T THE REST OF THE COUNTRY AGREE WITH THAT OR SEEM TO BUY INTO THAT. >>THIS IS A IT FOR AT THAT TIME TYPE — A FOR TAT TYPE TRADE WAR. IT’S NOT EASY FOR THEM TO HAVE THE SUPPLY CHAINS THAT FREELY. >>YOU SPENT YEARS BUILDING THIS UP ESPECIALLY FOR MAJOR PURPOSES LIKE STEEL. THIS IS FOR BUYING FOR THE ORB US AND PLACES, MANUFACTURING HAS BEEN AN AREA WHERE WE HAVE SEEN JOB GROWTH AND AN AREA THAT HAS BEEN PINPOINTED. IT’S NOT JUST A YIELD CURVE THAT DEPICTS RECESSION, THAT’S WHEN MORE PEOPLE SHOULD BE PAYING ATTENTION. >>WE’LL PAY ATTENTION TO THE MARKETS. WE’LL GO THE FLOOR OF THE NEW YORK STOCK EXCHANGE. >>>RIGHT NOW, WE’RE LOOKING AT CONSUMER STAPLES WHICH ARE UNDER PRESSURE ALONG WITH THE MATERIALS, WASN’T TO SHOW YOU DOW COMPONENT AM, UP ABOUT 1% TODAY. TODAY IS THE LAUNCH DATE FOR APPLE CARD FOR EVERYONE IN THE U.S., IT’S WHAT THEY’RE PROVIDING FOR GOLDMAN SACHS. APPLE IS CONSIDERING APPLE TV PLUS. THEY’RE GOING TO HAVE A $9.99 PRICE POINT, IT’S ABOVE DISNEY’S PRICE POINT AT $6.99 A MONTH. NETFLIX IS UNDER PRESSURE TODAY, DOWN ABOUT 2.5%, NETFLIX WHICH HAS TALKED ABOUT IN PAST ABOUT THE INCREASING COMPETITION IN THE STREAMING LANDSCAPE. WE’RE WATCHING JC PENNY, UP ABOUT 6%, THEIR CHAIRMAN RECENTLY BOUGHT 1 MILLION SHARES OF STOCK LAST WEEK WHEN IT HIT A LOW OF 53 CENTS A SHARE. THE STOCK IS AT RISK OF BEING DELISTED BECAUSE IT’S TRADING BELOW A DOLLAR A SHARE. JC PENNY IS CONSIDERING A REVERSE STOCK SPLIT IN THE NEXT SHARE HOLDER MEETING. >>>WE’RE TALKING ABOUT A POTENTIAL CUT IN THE PAYROLL TAX, IT COULD BE COMING IN THE NEAR FUTURE. THE WHITE HOUSE DENIES THEIR CONSIDERING THIS DESPITE THE REPORT IN THE WASHINGTON POST BY UNNAMED SOURCES. WE’RE TALKING ABOUT SOCIAL SECURITY AND MEDICARE TAXWISE PAY IN EACH PAYCHECK. >>THIS WOULD BE DIFFICULT TO ENACT IN ANY WAY, SHAPE OR FORM. WITH THAT BEING SAID, MORE MONEY IN ANYONE’S POCKETS IS A GOOD THING, RIGHT? IN THEORY. >>IN THEORY WE WOULD GO OUT AND SPEND THAT. IN THIS PARTICULAR CASE, I THINK WE’RE SHOWING WE’RE GETTING TO THE POINT IN THE ECONOMY WHERE THE WHITE HOUSE, THEY’RE GETTING CONCERNED AND THEY’RE FRANKLY THROWING THINGS AGAINST THE WALL TO SEE WHAT STICKS, AND SEE WHAT THEY CAN ACTUALLY RUN WITH. >>THE LAST TIME WE DID THIS, IT ADDED $93 BILLION TO THE NATIONAL DEBT? >>SOMETHING LIKE THAT, I THINK WHAT THIS MONEY FUNDS AND WHAT IT WOULD AFFECT DIRECTLY. >>THE LAST TIME WE DID THIS IS A 2 PERCENTAGE TAX CUT. THE PALE ROLL TAX FUNDS MEDICARE AND SOCIAL SECURITY, SINCE 2012, BOTH OF THOSE PROGRAMS HAVE BECOME IN MORE PRECARIOUS SHAPE. LATEST ANNUAL REPORT BY THE AGENCY SHOWS THAT MEDICARE WILL START RUNNING SHORT OF MONEY IN 2026. THAT’S 7 YEARS FROM NOW. IN 2012, THE MEDICARE SHORTFALL WAS SUFFICIENTLY IN THE FUTURE, SEVEN YEARS IS GETTING CLOSE. THESE ARE PROGRAMS FOR SENIORS, THEY’RE A POWERFUL VOTING LOBBY, IF THIS BECOMES A SERIOUS PROPOSAL YOU’LL GET TONS OF PUSH BACK, YOU’RE NOT TAKING MONEY FROM MEDICARE, FIND IT SOME PLACE ELSE. >>>LET’S TALK ABOUT EARNINGS AND BIG NAMES REPORTING EARNINGS, THAT’S INCLUDING HOME DEPOT, COHL’S AND T.J. MAXX, THIS IS ALL MISSED SALES AND THIS COMES ON THE HEELS OF THE TRADE WAR CHINA. >>ARE WE SEEING THE BEGINNINGS OF THE TRADE WAR, THE TAX HASHES BEEN ABSORBED BY THE — HAS BEEN ABSORBED BY THE IMPORTERS. >>THE FOLKS IS ON THE COMPANIES THEMSELVES. DOS IT TRICKLE INTO THE CONSUMER, WHAT DOES IT MEAN WHEN IT COMES THE NEXT ELECTION CYCLE, IT WILL PROBABLY IMPACT THE WAY I THINK ABOUT VOTING, WE’RE SEEING ESPECIALLY WITH THE RETAIL ENVIRONMENT, IT’S BEEN A DIFFICULT ONE, THE SALES MISS IS A REAL CHALLENGE HERE, THEY BEAT ON EPS AND BEAT ON EPS PRETTY WELL. IF YOU HAVEN’T GROWN YOUR TOP LINE, LOOK AT THE JC PENNY NEWS, IT’S AN ICONIC INSTITUTION, THEY LIKELY WILL BE ABLE TO DO A REVERSE SHARE SHIFT. THIS IS SOMETHING PEOPLE ARE NOT THINKING IN THE WILDEST DREAMS. >>IMAGINE WHAT WILL HAPPEN IN A RECESSION THAT WILL BE THE REAL APOCALYPSE, I DON’T THINK JC PENNIES CAN SURVIVE A RECESSION, AND I’M NOT WILLING TO SAY, THAT MISSING TARGETS ON TO LINE FOR A COUPLE OF RETAILERS ARE A BAD SIGN FOR THE ECONOMY. IN THE MOST RECENT RETAIL SALES, STRONG ECONOMY IS EXPECTED. CONSUMERS ARE SPENDING MONEY, THERE ARE BIG SHIFTS IN TERMS OF RETAIL, IN TERMS OF WHERE THEY’RE SPENDING IT. >>WE’RE TALKING ABOUT KOHL’S AND TJ MAX. >>THEY COULD BE SELLING THE — T.. MAXX. >>>THIS IS A GOOD THING FOR CONSUMERS. IT’S STIMULATING IT FOR CONSUMERS. >>>WHEN I THINK OF KOHL’S I THINK OF THE DISCOUNT STORES. SAME STORE SALES FELL IN THE FIRST QUARTER. THAT WOULD BE A CONCERN FOR THE STORIES AND WHAT ABOUT AMAZON. >>THE LAST STRONG RETAILER WAS AMAZON PRIME. WE’RE SEEING SOME TRICKLE DOWN INTO PARTS OF THE ECONOMY ON THE DISCOUNT SIDE WHICH WOULD BE CONCERNING IF IS THIS SHOW DOWN MAKING ITS WAY INTO THE REAL ECONOMY. I’M NOT NECESSARILY THERE YET, LET’S THROW EVERYTHING OUT AND BEGIN TO FREAK OUT IF YOU WILL. WE HAVE TO PAY ATTENTION TO THIS. IF IT CONTINUES. >>WAL-MART IS DOING FINE? >>IT WAS EXCELLENT. REALLY US. IT’S COMING FROM A POINT — IT’S REALLY IMPRESSIVE: >>THEY’VE BEEN INVESTING A BIG PART OF THEIR BUSINESS, THERE WAS A 3% INCREASE. >>WE’LL GET OFF OF RETAIL. >>>COMING UP, BETTING AGAINST BEEF, WHY JP MORGAN HAS RENEWED OPTIMISM FOR BEYOND MEAT. LET’S LOOK AT SOME OF THE BIGGEST LOSERS IN THE DOW TODAY. AND THERE YOU SEE THEM. >>>WE HAVE THE DOW JUST UNDER WATER HERE ALONG WITH THE OTHER MAJOR INDEXES, WE SPENT MOST OF DATE IN THE RED. WE POPPED INTO THE GREEN 1 HOUR AGO. THE RUSSELL 2,000 IS THE BIG UNDERPERFORMER OF DATE. IT’S RIGHT AT THE SESSION LOWS NOW. LET’S TAKE A LOOK TO TENURED T NOTE YIELD. IT’S DOWN FOUR BASIS POINTS AGAIN, WE’RE LOOKING AT A LONGER TERM CHART. WE CAN SEE THE DOWN TREND THERE. IT’S SET TO BE DOWN 44 BASIS POINTS. IT’S THE BIGGEST DROP IN YEARS. AN INTERESTING STATISTIC FROM THE F IT. YESTERDAY, 55 TRILLION IS THE GLOBAL BOND MARKET. HALF BELONGS TO THE U.S. AND 88% OF THE YIELD IS PAID BY THE U.S., THAT’S WHY PEOPLE ARE FLOCKING INTO US TREASURRIES RIGHT NOW. THE U.S. DOLLAR INDEX IS UP MARGINALLY, WE’RE TESTING THE MULTIYEAR HIGH RIGHT NOW. IT’S BEEN UP OR SET TO BE UP 6 DAYS IN A ROW RIGHT NOW. WE CAN SEE CRUDE OIL, IT’S DOWN JUST A LITTLE BIT. IT’S AT THE UPPER END OF THIS TREND CHANNEL THAT WE’VE BEEN WATCHING HERE. IF IT BREAKS ABOVE, IT COULD HAVE MOMENTUM GOING UP TO 60, IF IT SELLS OFF, IT GOES DONE TO 51, IT’S GOING AT A CRITICAL POINT, IT’S NOT TOO MUCH VOLATILITY IN THE PARTICULAR MARKET. WE’RE LOOKING AT GOLD FUTURES, HOLDING STEADILY ABOVE 1500, WE TESTED THE LEVEL SUCCESSFULLY. IT’S UP 15 BASIS POINTS TODAY. WE HAVE THE DOW, FIRST OF ALL, AND WE CAN SEE MICROSOFT IS UNCHANGED AND APPLE IS UP 1% ACCOUNTING FOR A LITTLE BIT OF STRENGTH HERE, BOEING, IT’S DOWN 3/4 OF A PER CENT. HOME DEPOT, WE’VE BEEN WATCHING CONSUMER DISCRETIONARY, THAT SECTOR IS UP TODAY. AND HOME DEPOT IS UP 4 AND A HALF% RIGHT NOW AND THE MCDONALD’S CONSUMER DISCRETIONARY IS UP NOW. IT’S UP 1/3 OF A PER CENT. THEY’VE BEEN UNDER PRESSURE, YIELDS COMING DOWN AS THEY ARE TODAY. JUST REALLY SOME INTERESTING MOVES HERE. A LOT OF THE MARKETS, LET’S TAKE A LOOK AT JP MORGAN. IT’S 105, 106, AND BANK OF AMERICA, WE’RE WATCHING THE 26 LEVEL, IT’S RIGHT DOWN THIS, WE DON’T WANT TO SEE THAT VIOLATED ON A CLOSING BASIS AND CITIGROUP, THAT’S ALSO COME DOWN TO SUPPORT AND IT IS AT ABOUT THE 60 LEVEL, AS WE CAN SEE RIGHT HERE, IT’S JUST HOVERING ABOVE IT. ALL IN ALL THE FINANCIALS IN FOCUS HERE, AND YOU NOW, THE FINANCIALS TEND TO PEAK OUT AS THE FEDERAL RESERVE IS CUTTING RATES OR JUST BEFORE, IT’S NOT THE BEST TIME TO BUY BANK STOCKS RIGHT NOW. >>>WHAT WAS THE OVERALL FOR THE SOFTEN DEBT MARKET. >>THE US OWNS HALF OF IT AND WE PAY OUT 88% OF THE INTEREST. >>>KEEP THAT STATS IN MIND. THEY’RE WAITING FOR JEROME POWELL’S REMARKS AT THE JACKSON HOLE MEETING. >>>AND THEY EXPECT A 75% RATE CUT BY MARCH OF 2020. STEWART QUIZZER IS HERE. IT’S GOOD TO SEE YOU ONSET HERE. YOU EXPECT US TO HAVE THREE RATE CUTS BY MARCH OF 2020. WHY? >>THE MAIN REASON IS THE ADDITIONAL TARIFFS WILL BE AN ADDITIONAL DRAGON THE ECONOMY, PART OF THE FOMC WANTED TO CUT RATES IN JULY. THERE’S A CLEAR BIAS IN THE AREA OF THE COMMITTEE THAT WANTS TO CUT RATES, YOU HAD SOME SORT OF DATA OUT OF THE EUROPE AND COLLECTIVELY SPEAKER, YOU’LL WANT IT TO CUT RATES SIGNIFICANTLY IRKSOME BROUGHT UP SOMETHING, WE’LL GET THE MINUTES TOMORROW FROM THE LAST FOMC MEETING, IF WHAT YOU JUST SAID WE KNOW THERE IS A PUSH WITHIN THE FOMC TO PUSH FOR MORE RATE CUTS THAT COULD SEND MARKETS HIGHER DEPENDING ON HOW THEY WORDED IT. >>OUR VIEW GOING INTO THE FOMC IS THAT THEY WANTED TO CUT 50, THEY WERE NOT ABLE TO PUSH IT OVER THE LINE. THERE WERE MEMBERS, VOTING AND NONVOTE HOG DON’T SEE ENOUGH TO DO THAT. THE WAY THEY MENTION THAT DISCUSSION OR DEBATE THEY’LL HAVE LATER ON THIS WEEK. >>WILL THIS HAPPEN, TARIFFS HARM CERTAIN CATEGORIES OF INDUSTRY AND OF CONSUMERS AND RATE HIKES DON’T GET TARGETED LIKE SURGERY AT THE ECONOMY. WILL IT ACTUALLY WORK, IT’S A BROAD BRUSH? >>IT’S A FAIR POINT. YOU CAN ARGUE THE WORK THEY’VE BEEN DOING IS NOT CUTTING RATES, A RATE CUT IN THE U.S. DOESN’T TARGET THE DAMAGE DONE FROM THE TARIFF. IT IS THE TOOL IT HAS, AND IT GETS CONDITIONS AND HELPS PARTS OF THE ECONOMY THAT WILL IMPACT NEGATIVELY THE TARIFFS. >>IS PRESIDENT TRUMP OVERCONFIDENT ABOUT THIS. WE KNOW HE HARASSES THE FED. WE’RE IN A CUTS CYCLE. HE THINKS THE FED HAS HIS BACK, IS THAT TRUE? >>THAT THE FED HAS TRUMP’S BACK? >>THAT THE FED CAN COVER FOR WHAT DAMAGE TRUMP CAN DO? >>CUTTING RATES IS STIMULATING GROWTH. HE BELIEVES AND HE’S REPEATEDLY THAT THE FED MADE A MISTAKE AND THEY SHOULD HAVE IT 100 BASIS POINTS LOWER. HE THINKS THEY NEED TO DO ANY COMPENSATION FOR HIM, HE BELIEVES IN WHAT HE’S DOING. HE WANTS THEM TO CUT THE RATES AND THAT’S THE DIRECTION THEY WANT HIM TO GO. >>DOES THE MARKET WANT TO SEE THE FOMC BEING MORE NEGATIVE ABOUT GROWTH. DOES THAT BOOST THE MARKET OR ARE WE AT A POINT WHERE INVESTORS ARE INTERPRETING IT AND IT’S A BIT OF A MIXED MESSAGE. >>THEY’VE BEEN PRICE AGO SIGNIFICANT AMOUNT OF CUTS, CLEARLY IF THAT’S NOT DELIVERED, THE ELEMENT OF THE MARKETS WILL BE DISAIDED. ONE OF THE BEST STIMULUS THEY CAN HAVE IS WHEN IT’S NEGATIVE. I THINK IT WAS POSITIVE FOR THE ECONOMY, OUR VIEW ON HOW EQUITIES AND RISK MARKETS HAVE RESPONDED, THEY LIKE POLICIES SHORT TIME, IT’S STIMULATIVE. THEY’RE CONCERNED ABOUT THE ECONOMIC OUTLOOK. IF THE FED IS TALKING ABOUT THAT NEGATIVELY, IT GETS AN HEAD WHIPPED AND THAT EASES UNLESS THE GROWTH RATE IMPROVES SIGNIFICANTLY, YOU SEE A MUCH BIGGER PICTURE THAN WE DO, AND DAVE SEES IT BIGGER AS WELL. WHERE ARE WE SEEING A LIQUIDITY OR LENDING FREEZE, OR A TIGHTENING OF EXIST, IT BE DOESN’T ESSEXIST. >>IT DOESN’T SEEM TO IN THE U.S. OR IN EUROPE. IF BONDS ARE ISSUES YOU’D THEY’RE GETTING BOUGHT. ULTIMATELY THAT’S THE TOOL THAT THEY’RE OPERATING WITH. I WOULD TEND TO AGREE WITH YOU, IT DOESN’T SEEM LIKE ANY DECENT CREDIT HAS TROUBLE RAISING MONEY. >>THIS IS NOT 2008, AND ABSOLUTELY NOT 2008 WHERE WE HAD THE LIQUID IT FREEZE AND GETTING MONEY OUT THERE. >>PEOPLE WHO OWNED HOMES AND GOTTEN LOW INTEREST RATE LOANS, GENERALLY THERE COULD BE SOME PEOPLE WHO MADE THOSE PURCHASES WHEN RATES WERE SORT OF AT THE PEAK, IT WASN’T THAT HIGH. THERE IS SOME REFINANCING PICKING UP THAT COULD BE HELPFUL TO CONSUMERS. >>THERE WAS A LOT OF DISCUSSION LAST YEAR SINCE THE FED WAS TAPERING AND TRIGGERING THE BALANCE SHEET, THERE WAS A TIGHTENING OF THE CONDITIONS AND THAT WOULD BE INCREMENTALLY POSITIVE. I WOULD INTEND TO AGREE WITH YOU. THE AREA OF THE MARKET THAT’S TAKEN ON THE MOST DEBT SINCE THE CRISIS HAS BEEN THE GOVERNMENT, IT REALLY HAS HAPPENED IN THE INDIVIDUALS. LOWER RATES THE GOVERNMENT CAN BORROW FOR LESS. WOULD WE CONSIDER THAT A POSITIVE. >>IT’S A COMPLICATE $2 RASH OF STUFF. >>I WOULD NOT TRADE POSITIONS WITH YOU, AND THANK YOU FOR BEING HERE. >>THANK YOU, APPRECIATE IT. >>>WELCOME TO THE LABOR FORCE, HOW COLLEGE GRADUATES CAN MAKE IT AND THE JACKSON HOLE SYMPOSIUM. YOU’LL HAVE COVERAGE THURSDAY AND FRIDAY. YOU HAVE TO HEAR IT. >>>COMING UP LATER IN NEW YORK, WE’RE IN THE TRADING DAY AND STOCKS ARE IN THE NEGATIVE. WE’RE WATCHING IT. >>>GOLD IS ABOVE 1500 AN OUNCE. 1450 AN OUNCE. >>>JP MORGAN HAS RENEWED OPTIMISM IN BEYOND MEAT. THE TOP LOCATION TO PURCHASE A NEW VACATION HOME. >>>APPLE TAKES A BITE OUT OF NETFLIX. THE COMPANY IS SPENDING $6 BILLION TO PROVIDE ORIGINAL CONTENT FOR THE STREAMING SERVICE, WILL ANYBODY WATCH IT. >>>BEYOND MEAT SHARES ARE ON THE RISE, THIS COMES AS JP MORGAN ANALYST, KEN MORGAN UPPED THE TARGET TO A TASTY $189 AND HEIDI CHUNG JOINS US FOR THIS. HE LIKES THE STUFF ALL OF A SUDDEN. >>WE’RE ON TEAM IMPOSSIBLE AND HE’S ON TEAM BEYOND MEAT. HE’S THE ONLY BULL ON THE STREET RIGHT NOW. HE WAS OVERWEIGHT WHEN HE INITIATED COVERAGE OF THE STOCK BACK IN LAWSUIT MAY, HE’S TEETH ERRED BACK AND FOR THE FROM NEUTRAL TO OVERWEIGHT RATINGS. THE VALUATION WAS BALLOONING WITH IT AND ANALYSTS WERE SAYING OKAY, WE COULDN’T JUSTIFY THIS CURRENTLY VALUATION THAT WE’RE SEEING FOR THE STOCK. WE CAN’T RECOMMEND BUYING IT ON THIS LEVELMENT WE’RE KEEPING AN EYE ON IT. THE VALUATION HAS COME DOWN A BIT AS WELL AS THE STOCK MARKET. IPO AT $25 IN EARLY MAY, SINCE THEN IT HAD A CRAZY RUN. WE SAW IT RUN UP ABOUT $580%, $850%, EXCUSE ME, SINCE THEN, AFTER THE MOST RECENT EARNINGS REPORT, WE HAD BAD NEWS COME OUT ABOUT A SECONDARY OFFERING, NOT NECESSARILY BAD NEWS, IT SPOOKED INVESTORS A BIT, WE SAW ETHAN BROWN SELL SHARES AHEAD OF THE LOCKUP EXPIRATION. WE SAW IT’S ESTIMATED 20% SALES, IT’S LOWER THAN BEFORE FOR THE VALUATION. THREE KEY REASONS WE’RE INDICATING A BUY RATING ON THE STOCK. THEY SEE IT AGGRESSIVELY PARTNER WITH FOOD COMPANIES AND RESTAURANTS. THERE ARE TWO QSRS THAT WILL BE PARTNERING WITH BEYOND MEAT AND ONE IS MCDONALD’S, IS THEY DO THAT, THAT COULD BE A GOOD SIGN FOR BEYOND MEAT INVESTORS AND WE DO KNOW THAT IMPOSSIBLE FOODS IS GOING TO HIT GROCERY STORES SOON, SO IF THAT DOES HAPPEN, THAT GIVES BEYOND MEAT ITS NEXT TRUE TEST. GROCERY STORES, IT’S GOOD OVERALL. >>THE BOTTOM LINE THIS IS NOT A TREND, THIS IS HERE TO STAY. >>A LOT OF THE ARGUMENTS WITH THE ANALYST COMMUNITIES AND RIGHT NOW, THE US MEAT MARKET IS 270 BILLION, THEY’RE ESTIMATING THAT THIS ALTERNATIVE MEAT MARKET WILL EAT IN THIS SPACE. >>IF THEY CAN INDEED STEAL AWAY SOME OF 9 ART OF THE EXIT MEAT EATERS, IT’S HERE TO STAY FOR REAL. >>IS IT GIVEN THAT ENOUGH PEOPLE LIKE THIS STUFF TO KEEP IT ON THE MEMBERSHIP YOU’RE. MCDONALD’S TEST AS HE LOT OF STUFF THAT DOESN’T STAY ON THE MENU. IT HAS TO GET IT A CERTAIN LEVEL OF POPULARITY, RIGHT? >>WHETHER PEOPLE MEAT EATERS WILL EAT ALTERNATIVE MEAT IN THEIR DIETS AS WELL, THAT REMAINS TO BE SEEN. >>IT’S GOOD TO HAVE THIS AS AN ALTERNATIVE FOR PEOPLE WHO DON’T EAT MEAT. YOUR OPTIONS ARE SO LIMITED IF YOU GO TO MCDONALD’S, ANOTHER ARGUMENT AMONGST A LOT OF PEOPLE. AT BURGER KING I SPOKE TO SOMEONE WHO WORKS IN THE KITCHEN, THEY COOK THE REPRESENTING WHOPPER AND IMPOSSIBLE WHOOPER ON THE SAME GRILL. IF YOU’RE A STRICT VEGETARIAN OR VEGAN THAT WILL BE BORROWING YOU. THAT WILL BE A BIG PROBLEM IN THE KITCHEN. >>AT SOME POINT WRITE ABOUT THAT. THEY DIDN’T HAVE THE SEPARATE GRILL, THAT’S NOT KOSHER. >>RECENT COLLEGE GRADS ARE FEARING THE HARSH REALITY OF NOT FINDING A STEADY JOB IN THEIR GRADUATION LIFE. OUR NEXT GUEST IS TRYING IT CHANGE THAT TREND FOR STUDENTS TO CHANGE IT FROM JOB OPPORTUNITIES TO MAJOR EMPLOYERS NATIONWIDE. GARRETT JOINS US NOW TO TALK ABOUT THIS AND THE CURRENT JOB MARKET. WHEN WE TALK ABOUT NETWORKING, WHAT ARE YOU DOING DIFFERENT THAT COLLEGE GRADS COULDN’T DO PRIOR TO THE HANDSHAKE BEING AROUND. >>SO MUCH WAS BROKEN, NOT MUCH HAS CHANGED SINCE YOU WITH THE TO SCHOOL, WHERE COMPANIES ARE SITTING IN GYMNASIUMS WITH 200 OTHER PEERS HOPING KIDS WALK UP TO THEIR BOOTH. HISTORICAL IS LA BORE I COULDN’T SAY. THEY BUILT A TRUSTED NETWORK FOR 800 UNIVERSITIES AND 4,000 COMPANIES INCLUDING THE FORTUNE 500 AND STUDENTS WITH THE COMMON GOAL OF TRYING TO FIND THE INTERNSHIP AND FIRST JOB. >>CAN YOU ADD A PROFILE, THE CLASSES YOU’VE TAKEN EXTRACURRICULARS AND YOU CAN SEE WHAT STUDENTS ARE DOING ACROSS YOUR CAMPUS AND OTHER CAMPUSES AND LEARNING FROM ONE ANOTHER. SOME OF THIS IS CONFUSING FOR STUDENTS AND COMPANIES CAN PRO ACTIVELY CONNECT WITH YOU AND THEY CAN APPLY AND FIND INTERNSHIPS. WE WANT TO THINK WE’RE FLIPPING THE MODEL. IT WAS PROACTIVE TO CONNECT WITH TALENT, YOU WERE HOPING PEOPLE APPLIED AND HEARD OF YOU. THAT’S HOW HANDSHAKE IS CHANGING THE GAME. >>YOU CAN FIND SOMEONE WHO IS INTERESTED IN BASKETBALL AND INTERESTED IN THE FINANCE CUP, IS THAT HOW GRANULAR IT GETS. >>A GREAT EXAMPLE OF THIS. DANIEL, IS AT A BLACK UNIVERSITY. NOT MANY EMPLOYERS WERE COMING ON CAMPUS. FORTUNE 500 COMPANIES WERE LOOKING FOR A STUDENT LOOKING TO WORK IN L.A. HE SAID HE WANTED TO WORK THERE. THAT’S AN EXAMPLE OF A COMPANY CONNECTING TO TALENT THEY HAVEN’T BEFORE SEEN. >>DO YOU AGGREGATE THE DATA, DO YOU BREAK IT DOWN. IS THAT SOMETHING YOU CAN HELP SELL TO GENERATE REVENUE FOR THIS. >>WE DON’T SELL THIS TO ANYBODY. WE HELP INFORM STUDENTS TO MAKE BETTER DECISIONS, YOU DON’T UNDERSTAND DIFFERENT CURVE PATHS OR WHAT INTERVIEW QUESTIONS ARE BEING ASKED. STUDENTS USE HANDSHAKE TO EXPLORE OR DISCOVER WHAT PIERCE ARE DOING ON THE NETWORK. IT DEBUNKS THE IDEA THAT IT’S MAJOR ON THE CAREER. >>DO YOU HAVE TO TAKE STEPS TO AVOID COMPANIES THAT MAY HAVE DUPLICITY US INTENTION TO DISCRIMINATE BY AGE OR RACE OR SEX. WE DO USE THE INTERNET TO WEED OUT, THEY WOULD BE PROHIBITED BY LAW TO DO SO BY JOB APPLICATION FORMS. >>THERE ARE EMPLOYMENT REGULATIONS, AND MANY OF THE COMPANIES HAVE TO HAVE LEGAL COMPLIANCE IN PLACE IN THE MARKETPLACE IN ORDER TO USE THE APPLICATION, I DO THINK THAT ONE EXAMPLE OF HOW COMPANIES ARE USING THIS, WHEN THEY’RE FINDING AND REACHING OUT TO STUDENTS, WHAT WE SEE THEM DOING IS USING EXTRACURRICULARS, SPORTS ACTIVITIES AND LOOKING BEYOND THE MAJOR, THAT’S A BIG TREND WE SEE ON THE NETWORK, WE’RE LOOKING AT STUDENTS AND IT’S BASED TO THE SKILLS. >>WHAT DO YOU SEE, PEOPLE PLAYING BASEBALL OR FOOTBALL OR SOMETHING LIKE THAT NETWORKS SALES FOR EXAMPLE, THEY’RE LOOKING FOR STUDENTS THAT ARE ATHLETES ACROSS ANY MAJOR, AND ANOTHER EXAMPLE WOULD BE ESPECIALLY IN THE SCIENCE TECHNOLOGY AND ENERGY AND MATH RECRUIT WILLING, WE’RE SEEING COMPUTER PROGRAMMING LANGUAGES, THIS IS WHERE YOU MAY BE LOOKING FOR A PROGRAM AND SCIENCE MAJOR. >>YOU’RE THE HANDSHAKE FOUNDER, ALL OF THE BEST TO YOU. >>THE FORMER DISNEY COMPANY SAYS IT’S BEEN COOKING THE BOOKS FOR YEAR. >>>WE WANT TO LOOK AT THE TOP TRENDING PARTICULARRERS ON YAHOO FINANCE TODAY. HERE’S THE REPORTS, HERE THEY ARE. >>>LET’S TAKE A LOOK AT THE TOP TRENDING STORIES. A FORMER DISNEY FINANCIAL ANALYST HAS BLOWN A WHISTLE. DISNEY EMPLOYEES WORKING IN THE PARKS AND RESORT PART OF THE COUNTRY OVERSTATED REVENUE FOR YEARS. THE WHISTLE BLOWER WAS FIRED FROM DISNEY IN 2017. >>>ACCUSED SEX TRAFFICKER SIGNED A MULTI-MILLION-DOLLAR WILL BEFORE HE COMMITTED SUICIDE. A TRUST WAS CREATED AUGUST 8TH. TWO DAYS BEFORE JEFFREY EPSTEIN KILLED HIMSELF, HIS NET WORTH WAS WORTH $577 MILLION, HE LEFT HIS ENTIRE FORTUNE TO THE TRUST, BUT ALLEGED CLAIMS FROM THE VICTIMS MAY PREVENT TRANSFER OF WEALTH TO THE TRUST. >>>AND US WHISKEY EXPORTS TO STRUGGLE, OF 3% OF WHISKEY EXPORTERS HAVE FACED TARIFFS FROM CHINA EU AND MEXICO WITH 25% OF THE TARIFFS COMING FROM THE EU, WHISKEY EXPORTERS SAW A 21% SALES TO EUROPE IN 2018 AND 2019. >>>TODAY MARKS DAY 2 OF QUALIFYING ROUNDS FOR THE HIGHLY ANTICIPATED US OPEN TOURNAMENT. BRIAN IS GETTING IN ON ALL OF THE ACTION. WE’RE JOINED IN FLESHING, QUEENS NEW YORK. BRIAN? >>>THANKS FOR THAT. I’M HERE WITH THE CHIEF REVENUE OFFICER OF U.S.D.A. >>TAD GOOD TO GET OUT OF THE OFFICE. IT’S FAN WEEK, THE CROWDS ARE GOOD. >>THEY’RE FANTASTIC, WE MADE A BIG EFFORT TO INVEST IN PROGRAMMING THIS WEEK. TRADITIONALLY IT’S A QUALIFYING TOURNAMENT. IT’S A BIGGER DEAL NOW. WE WANT TO ALLOW OUR FANS TO GET UP CLOSE AND PERSONAL WITH THE FANS IN THE WORLD. >>HOW ARE YOU SETTING UP THIS YEAR? >>WE’LL BE A MUCH BIGGER NUMBER. WE HAVE CONCERTS GOING ON WEDNESDAY, THURSDAY AND FRIDAY THIS WEEK. WE HAVE EXHIBITION MATCHES AND LENDS EXHIBITION MATCHES. WE SELL EVERY TICKET WE CAN MAKE AVAILABLE, YOU’VE TURN THIS INTO A TRUE EVENT. >>YES, WE HAVE. >>WE TALKED OFF CAMERA, A LOT OF INVESTMENTS BEHIND THE SCENES, A LOT OF WORK BEHIND THE SCENES. >>TECHNOLOGY TOUCHES SO MANY DIFFERENT ASPECTS OF AN EVENT. IT STARTS WITH PUTTING ROOFS OVER OUR STADIUM AND LEW ARMSTRONG STADIUM, WE USE TECHNOLOGY TO PRICE TICKETS ON A DAILY BASIS. >>LIKE UBER. >>MORE LIKE AN AIRLINE. WE HAVE 23 PRICE CODES DEPENDING ON SCHEDULING, MATCHUPS AND DEMAND. WE’RE USING ARTIFICIAL INTELLIGENCE WITH IBM HEAVILY FROM A SCOUTING AND PREDICTIVE AND LIT. >>WHAT’S THE GOAL WITH THIS TECHNOLOGY USE? >>I THINK IT’S, SEVERAL THINGS, I THINK FIRST AND FOREMOST, IT’S ENHANCING THE FAN EXPERIENCE, ALLOWING US HOW TRAFFIC MAY LOOK LIKE. AND GETTING THE BEST EXPERIENCE YOU CAN AND HELPING PLAYERSISM PROVE THEIR PERFORMANCE. >>IT CAN’T PROTECT A WINNER? >>NO. >>A LOT OF THE AGING VETERANS ARE PLAYING, ROGER FEDERER. >>HOW IS IT FOR THE GAME OF TENNIS THAT THEY’RE STILL PLAYING SO WELL? >>IT’S GREAT TO HAVE THESE PLAYERS ROGER FEDERER AND NADAL PLAYING INTO THEIR 30s, VENUS WILLIAMS PLAYING AT A HIGH LEVEL. FANS KNOW THOSE PLAYERS, AND THEY’RE ATTACHED TO THOSE PLAYERS, THEY WANT TO WATCH THOSE PLAYERS PLAY AND THERE’S A NEW CROP OF PLAYERS COMING UP THAT NOW, HAVE THE OPPORTUNITY TO TEST THEMSELVES AGAINST THE GREATEST OF ALL TIME IN MANY CASES, AND WE’RE IN A GOLD TEN AGE OF SPORT. %>>AND HOW IMPORTANT IS IT TO HAVE THOSE TWO TYPE OF TALENTS. >>COCOA DID INCREDIBLE THINGS IN WIMBLEDON AND HOPEFULLY WILL DO WONDERFUL THINGS AT THE U.S. OPEN, A HUGE TALENT IN THE FUTURE AND A REASON FOR A LOT OF TENNIS FANS TO BE EXCITED ABOUT WHAT THE NEXT GENERATION OF GREATS WILL BE WITH. AND ANOTHER SLAM HAS BEEN WON SINCE AND A JAPANESE PLAYER THAT HAS IGNITED INTEREST IN THE SPORT THROUGHOUT ASIA. WE’RE A GLOBAL EVENT AND THAT’S A HUGE HELP. >>WHAT HAVE YOU BEEN DOING DRIVING THE PLAYERS, HOW DO YOU PLAN TO GET THE NEXT CROP BACK IN THE GAME. >>AS AN ORGANIZATION, AT OUR CORE, WE’RE A NONPROFIT, MISSION FOCUSED WE WANT TO GROW THE GAME AND MAKE SURE IT’S GROWING FROM A PARTICIPATION STANDPOINT. THE BAKE SALE FUNDS THE EFFORTS TO BRING MORE PLAYERS INTO THE SPORT. IT’S NOT BECAUSE WE HAVE A STATE IN COURT CONSTRUCTION OR A BALL AND RACKET SALES. IT’S NOT ALONE AMONG SPORTS, IT’S A GREAT QUALITY OF LIFE AND THE EXTENSION OF QUALITY OF LIFE IN THE COUNTRY. WE INVEST TENS OF MILLIONS OF DOLLARS TO ATTRACT PLAYERS INTO THE GAME. WE HAVE A PLATFORM CALLED NET GENERATION, THE UMBRELLA THAT WE USE TO ATTACH ALL OF OUR 18 AND UNDER YOUTH PROGRAMS, IT’S OUR MARKETING PLATFORM, IT’S OUR A PLATE FORMAT, IT’S DIGITAL OUTREACH TO ENGAGE WITH KIDS IN THE COURTS. NOW, THIS YEAR PARTICIPATION HAS BEEN UP, AND WE EXPECT THAT TO CONTINUE, THAT’S BUCKING THE TREND IN THE U.S., WE YOUTH PARTICIPATION IN SPORTS HAS BEEN DECLINING FOR A DECADE. >>A LOT OF TALK IN THE OUR WORLD OF FINANCES. >>WE’RE VERY FORTUNATE, I THINK IF YOU THINK BACK TO 2007, 2008, LOTS OF FOLKS IN SPONSORSHIP, THEY TALKED ABOUT FLIGHT TO QUALITY, YOU DIDN’T WANT TO GIVE UP YOUR TICKETS IN A FEAR YOU HAVEN’T BEEN ABLE TO GET THEM BACK. YOU’RE A SEASON TICKET HOLDER, WE DIDN’T EXPERIENCE HOW OTHERS DO. WE HAVE LONG TERM CONTRACTS STAGGERED OVER TIME. WE TRY TO PROTECT OURSELVES FOR THAT. WE ARE GOING TO CONTINUE TO INVEST IN THE EVENT, TO MAKE SURE THERE’S VALUE, AT WHATEVER PRICE THERE IS, THERE’S THE GREATEST VALUE YOU’VE SPORTS AND ENTERTAINMENT. >>WHO WINS THE MEN’S AND WOMEN’S. >>THERE WILL BE A CHAMPIONSHIP FOR MEN AND WOMEN. THAT’S CHAMPIONSHIP SEASON EVERY YEAR AT THE U.S. OPEN, AND WE’RE EXCITED. >>THANKS FOR JOINING US, LEWIS SHERR. >>WITH A FEW WEEKS REMAINING IN THIS YEAR’S SUMMER VACATION, MANY PEOPLE MAY BE ON THE HUNT TO BE ON A VACATION HOME THAT MAY SATISFY THE OUT OF TOWN DESIRES. THEY SURVEYED THE RANKING TO PURCHASE A VACATION HOUSE IN UNITED STATES. PORTLAND, OREGON WE HAVE RESEARCH AND IN SIGHTS. >>>ALL RIGHT. NUMBER 1 SPOT IS TENNESSEE, RIGHT? WHERE ELSE ARE PEOPLE, WITHIN THAT TO 10, WHERE ARE PEOPLE LOOKING TO BUY VACATION HOMES? >>WE SAW A BATTLE BETWEEN THE MOUNTAINS AND THE BEACHES IN THE TOP 10 THIS YEAR. WE HAVE SURVEIL NUMBER 1, AND KILLINGTON, AND DATA PORT AND WHITTIER IN NORTH CAROLINA NUMBER 4. THE BEACHES ARE REPRESENTED IN THE TOP 10, LAST YEAR THEY HAD 9 OUT OF THE TOP 10 SPOTS AND THEY ALSO TOOK A BIG SHARE OUT OF OUR TOP 25 THIS YEAR ROUND. >>>LET ME TALK TO YOU ABOUT SOME OF THE COASTAL AREAS. FOR EXAMPLE, KEY WEST IS UP THERE. IT’S REALLY EXPENSIVE, KEY WEST AND IT WILL BE UNDER WATER IN THE NEXT 30 YEARS, DON’T PEOPLE TAKE THAT INTO CONSIDERATION? >>YOU KNOW, WE HAVEN’T SEEN ANY DECLINE IN GUEST DEMAND IN KEY WEST MUCH IT’S A POPULAR MARKET. IF YOU’RE LOOKING FOR CLASSIC MERKIN, THERE’S NO PLACE BETTER THAN KEY WEST. >>THERE ARE THINGS YOU CAN FIND ONLINE THAT WILL SHOW YOU ESTIMATED SEA RISE THAT WILL INUNDATE TONS OF COASTAL COMMUNITIES, IS THAT SHOWING UP AS A FACTOR. >>OUR ANALYSIS DIDN’T TAKE GLOBAL WARMING INTO ACCOUNT. WE LOOK AT THE AVERAGE HOME SALES PRICES FOR THE MARKETS AND WHAT THE NET OPERATIVE INCOME IS WITH THE INTENT OF HELPING FOLKS WHO ARE LOOKING FOR A HOME THAT WILL PAY FOR ITSELF. >>WHAT WERE SOME OF THE BIGGEST SURPRISES YOU SAW THIS YEAR IN LIGHT OF THIS BEING THE SECOND GO. >>YOU KNOW WE SAW MORE IN THE RISE OF 9 MOUNTAIN MARKETS THIS YEAR AROUND. AND IT WILL BE, IT WAS INTERESTING, IT WASN’T NUMBER 1, THERE’S MORE AND MORE RENTAL INCOME COMING OUT OF THE MOUNTAIN MARKETS. THEY’RE DIVERSIFY FROM BEING MORE THAN A SKI MARKET, MOUNTAIN BIKE ACTIVITY, AND KILLINGTON IS A GREAT EXAMPLE, THERE’S SO MUCH TO DO IN KILLINGTON OUTSIDE OF THE WINTER SEASON, THERE’S RENTS HAPPENING FROM JANUARY TO DECEMBER, WHICH MEANS THE OPERATING INCOME IS SIGNIFICANTLY HIGHER FOR THESE MARKETS. WE’RE SEEING MARKETS CLIMBING IN 2019. >>>WE’RE GOING TO HAVE THE BEST ON YAHOO FINANCE.COM. >>>BATTLE OF BURDENS, THREE FAST FOOD RESTAURANTS COMPETE FOR THE MOST BELOVED CHICKEN SANDWICH. PLUS BEFORE WE GO TO BREAK, TACK A QUICK LOOK AT WHAT IS HAPPENING IN THE RESALE STOCKS TODAY. >>>LET’S HEAD BACK TO THE NEW YORK STOCK EXCHANGE AND SEE WHAT’S HAPPENING IN THE MARKETS. >>Reporter: ADAM TODAY WE HAVE GOTTEN A BETTER LOOK AT THE LANDSCAPE OF RETAIL. I WANT TO SHOW YOU SOME NAMES THAT ARE MOVING TODAY. LOOK AT HOME DEPOT UP 4% AFTER THEIR ADJUSTED EARNINGS FOR THE LAST QUARTER, CAME IN AS A BEAT. THEY LOWERED GUIDELINES, BECAUSE OF THE POTENTIAL TARIFFS ON LUMBER. KOHL’S WAS A MISS. THEY’RE SALES WERE DOWN 2.9%. IT WAS LARGER THAN EXPECTED. THEY SAID THE LAST 6 WEEKS OF THE QUARTER WERE STRONG. SO FAR SUCCESSFUL BACK-TO- SCHOOL SEASON AND VERY BULLISH ON THEIR INCREASED TRAFFIC BECAUSE OF THAT AMAZON RETURN PROGRAM THAT THEY HAVE. AND THEN T.J. MAXX, THE PARENT COMPANY COMING OFF OF THE LOWS OF THE SESSION TODAY. STILL UNDER PRESSURE TODAY. THE SAME STORE SALES WERE UP 2%, THAT’S BELOW WHAT THE STREET WAS EXPECTED. >>>THANK YOU. IT’S TIME THE BUZZER ROUND. >>>WE START WITH THIS, MICKEY MOUSE WILL HAVE TOUGH COMPETITION IN THE STREAMING WORLD. IT’S AIMING TO LAUNCH THE PLUS SERVICE IN NOVEMBER. THIS COMES AROUND THE SAME TIME AS THE DISNEY PLUS SERVICE, ANYONE WHO WANTS TO TAKE BETS ON THIS ONE. >>WE’LL CUTTER FOR WHILE. WILL I SPEND MORE SUBSCRIBING TO THESE SERVICES. >>YOU PROBABLY ARE, AND YOU’LL HAVE DIS, ANY NETFLIX WILL COME UP WITH SOMETHING YOUR KIDS WILL HAVE TO HAVE AND YOU’LL HAVE THIS. >>AND WHEN WILL PEOPLE SAY I HAVE TOO MANY OF THESE THINGS AND IT WILL BE 2020. >>IT AGGRAVATED THE DIFFERENT CHANNELS. NOW, WE NEED A STREAMING AGGRAVATED. >>100 CHANCE AND NOTHING ON. >>>GUNS ARE PROHIBITED FROM BEING SOLD, AND THEY’RE LISTENING GUN CASES AND BECOMESES FOR A HIGHER PRICE. ANYTHING FACEBOOK CAN DO? >>JUST WHAT FACEBOOK ALWAYS DOES, KEEP PLAYING WHACK A MOLE, I GUESS. THEY FOUND PEOPLE SELLING GUN CASE THAT IS WOULD COST $30 FOR 8 OR 900 DOLLARS AND SAY WHAT’S GOING ON. WELL, THERE’S A GUN INSIDE. LOOK, IF PEOPLE ARE DOING IT ON FACEBOOK, THEY’RE DOING IT ON CRAIG’S LIST AND EVERY PLACE HEADLINES THAT OFFERS THE MARKETPLACE, FACEBOOK IS NOT ALONE. >>WE USED TO THINK THESE THINGS OCCURRING IN THE DARK WEB AND BASED IN COUNTRIES WE’VE NOT HEARD OF EITHER. THE CHALLENGE FOR FACEBOOK, ALL OF THIS IS HAPPENING IN THE MARKETPLACE, THAT’S WHAT IT’S CALLED, AND WE EXPECT THEM TO BE ABLE TO CONTROL THESE THINGS, AS WE KNOW IT’S REALLY DIFFICULT TO DO. >>WOULDN’T THIS BE A VIOLATION OF FEDERAL LAW? >>I THINK IT IS, THAT’S THE WHOLE PINKS POINT. >>WHO IS VIOLATING THE LAW. >>THE SELLERS ARE VIOLATING THE LAW. IS FACEBOOK VIOLATING THE LAW, SOMEBODY SPEAKING THESE SALES BEHIND THE SCENES. >>SHOULDN’T FACEBOOK BE TURNING OVER THE SELLERS. >>IT BUZZED. >>>A FIGHT FOR THE BEST CHICKEN, CAJUN FRIED CHICKEN POPEYE’S HAS BEEN INTRODUCING THE CHICKEN SANDWICH THE LAST FEW DAYS, WHO WILL WIN THE CHICKEN SANDWICH WAR, THIS IS THE BEEF OF OUR CENTURY. >>MY ANSWER IS THE SAME AS THE PRIOR ANSWER, WE THE EATING PUBLIC WIN. IT’S A GOLDEN AGE FOR CHICKEN. THERE’S GREAT CHICKEN EVERYWHERE. I HAVE NOT HAD THE BURGER KING. I LOVE CHICK-FIL-A, I WISH THEY WOULD BE LESS ACTION ON THEIR SOCIAL ISSUES, I LOVE CHILL FILET AND POPEYE’S AND CRAVE WINGS NEAR ME, THE KIDS LOVE THAT. AND CANDLELIGHT INN UP IN WEST COASTER COUNTY. >>YOU CAN MAKE MISTAKES WITH CHICKEN. REMEMBER POPCORN CHICKEN, IT WAS FRIED BATTER, IT WAS DISGUSTING. >>WE HAVE ALL OF THESE CHOICES, IT’S NOT A BAD THING, BUT THERE WILL BE A WINNER. >>SEE THE LINES THEY’RE AROUND THE BLOCK, CHICK-FIL-A — THIS REMINDS ME OF CRAFT BEER, THERE ARE TONS OF GOOD ONES AND LOTS OF GOOD CHICKEN OUT. >>I’M GOING BEYOND THE BUZZER. >>WILL WE SEE DO A FAKE CHICKEN. >>FAKE FRIED CHICKEN. >>WE’LL HAVE FAKE EVERYTHING SOON. >>IF THEY CAN PULL IT OFF. >>SO,, I AM BUZZED. I GOT BUZZED. I’M NOT BUZZED YET. >>Reporter: LET’S LOOK AT THE DOW AND INDEXES, WE’LL KEEP AN EYE ON THIS FOR YOU ALL DAY. REMEMBER THAT, AN HOUR AND A HALF AGO, THE DOW WAS IN POSITIVE TERRITORY. THE DOW IS OFF 32 POINTS, ALL MARKET SUMMIT ON OCTOBER 10TH. FOR MORE DETAILS YOU CAN GO TO YAHOO FINANCE AFMS.COM. WE’LL TAKE YOU THROUGH THE NEXT HOUR OF TRADING. >>>IT IS 1:00 P.M. IN NEW YORK CITY AND STOCKS ARE SLIGHTLY LOWER AS NEW RETAIL EARNINGS RAISE QUESTIONS ABOUT THE STATE OF THE U.S. CONSUMER. ON TAP FOR TODAY, HOME DEPOT, KOHL’S AND TJ MAXX’S PARENT COMPANY IN FOCUS AS THE MARKET GETS AN UPDATE ON RETAIL AND HOW TARIFFS MIGHT BE FACTORING INTO SLOW GROWTH. HOPPING ON THE ANTI-TECH BAD WAGON. WHY APPLE APPEARS UNFAZED. >>>CARNAGE IN THE CAB THAT BUSINESS SPACE. TURNS NEGATIVE FOR THE YEAR úAF THE FORMER CO-CEO OF CANOPY GROWTH WILL JOIN US LIVE FOR WHY THE SECTOR COULD HAVE ROOM TO GROW. ALL THAT AND MORE. THIS IS YFi PM. GOOD AFTERNOON AND HAPPY TUESDAY. I’M ZACK GUZMAN. JOINING ME TODAY IS YAHOO FINANCE’S HEIDI CHUNG. ALONG WITH ANNE BARRY. GOOD TO SEE YOU BOTH. IT’S A BIG TUESDAY. >>IT’S GOING TO BE A GREAT SHOW. I DON’T KNOW IF PEOPLE ARE READY. >>I’M NOT READY MYSELF. WE START BY CHECKING THE MARKET ACTION WE’RE SEEING RIGHT NOW. LITTLE BIT AFTER BREATHE AS THE DOW IS OFF ABOUT 25 POINTS. THE S&P OFF ABOUT 5. THE NASDAQ OFF JUST A LITTLE BIT MORE THAN .1%. WE’LL KEEP YOU UP TO DATE ON THE MARKET ACTION THROUGHOUT THE HOUR. FIRST THE CRACKDOWN ON BIG TECH. A GROUP OF STATES IS REPORTEDLY PREPARING TO MOVE FORWARD WITH A JOINT ANTI-TRUST INVESTIGATION OF TECH BEHEMOTHS LIKE GOOGLE, FACEBOOK, AMAZON AND APPLE. ALTHOUGH THE EXACT NUMBER OF PARTICIPATING STATES IS UNKNOWN AT THIS POINT, THE JOURNAL SAYS IT COULD INCLUDE UP TO 20 OR MORE. AND THIS COMES AS THE JUSTICE DEPARTMENT ALSO ANNOUNCED ITS OWN ANTI-TRUST REVIEW LAST MONTH. SO THE QUESTION RIGHT NOW IS HOW WORRIED INVESTORS SHOULD BE WHEN WE TALK ABOUT THESE NAMES. NOW NOT JUST FACING SCRUTINY AT A FEDERAL LEVEL BUT POTENTIALLY 20 STATE ATTORNEYS GENERAL COMING AFTER THEM. >>IT’S POTENTIALLY GOING TO COST THEM A LOT OF MONEY. WE SAW FACEBOOK SETTLE WITH THE FTC. THAT COST THEM A GOOD CHUNK OF MUST BE AS WELL. FOR INVESTORS THIS IS SOMETHING TO WORRY ABOUT. WE DON’T KNOW EXACTLY HOW IT WILL PAN OUT AND HOW MUCH IT WILL COST THEM. COMPANIES ARE GOING TO HAVE TO SET ASIDE MONEY TO POTENTIALLY SETTLE WITH ALL THESE DIFFERENT LAWSUITS OR WHATEVER, YOU KNOW, THE PROBES THAT WE’RE SEEING. SO FOR THE INVESTORS, IT IS SOMETHING TO WORRY ABOUT. AT THE SAME TIME THE STOCKS REALLY STRUGGLE EVEN THOUGH THERE ARE ALL OF THESE DIFFERENT PROBES THESE BIG TECH COMPANIES ARE FACING. ON ONE HAND, YES, THEY SHOULD WORRY. BUT WE’RE NOT SEEING THAT REFLECTED IN THE STOCKS, I THINK. >>I THINK WHAT’S INTEREST IF YOU LOOK AT WHAT HAPPENED WITH THE LANDMARK ANTI-TRUST CASE WHICH IS MICROSOFT. IT WAS A SIMILAR TACTIC. IT WAS THE STATE JUSTICES AND THE FEDERAL PROGRAM THAT CAME TOGETHER TO ULTIMATELY LED TO THE OUTCOME THAT WAS SEEN THERE. SO IT’S INTERESTING TO SEE A SIMILAR TACTIC BEGIN TO UNFOLD. WHAT I’M INTERESTED TO SEE IS HOW THE RHETORIC CHANGES A LITTLE BIT. ON THE ONE HAND YOU HAVE THIS BIG PUSH TO BREAK UP BIG TECH. THESE ARE THE BIGGEST HELPS OF R&D. THERE’S CONCERN THERE’S NOT ENOUGH INNOVATION. >>NOT TO MENTION TOO, WE TALK ABOUT HOW EVEN THE TRUMP ADMINISTRATION RIGHT NOW IS TRYING TO HIT BACK WHEN WE TALK ABOUT THESE COMPANIES GETTING HIT WITH THE TAX IN FRANCE AND HOW TARIFFS MIGHT BE USED THERE TO KIND OF HIT BACK AGAINST THAT COMPANY AND THE EU IN GENERAL. TE COUNTRY, I SHOULD SAY. WHEN WE TALK ABOUT THAT, IT IS INTERESTING. IT’S NOT JUST THE RIGHT OR THE LEFT. BOTH SIDES REALLY PUSHING FOR A LOOK AT THESE BIG TECH COMPANIES WHEN YOU TALK ABOUT SENATOR ELIZABETH WARREN BEING OUTSPOKEN ABOUT BREAKING UP BIG TECH. I’M NOT SO SURE. I’D BE CURIOUS TO GET YOUR THOUGHTS ON WHETHER OR NOT THOSE FEARS ARE REAL WHEN WE TALK ABOUT ACTUALLY BREAKING THESE COMPANIES UP VERSUS JUST MORE SCRUTINY IN TERMS OF FINES. AND THE WAY THESE COMPANIES OPERATE. >>I THINK THAT’S RIGHT. BIPARTISAN PERSPECTIVE THERE’S A DIFFERENCE BETWEEN HAVING MORE PROTECTION OF PERSONAL DATA, FOR EXAMPLE. MAKING SURE YOU HAVE APPROPRIATE COMPETITIVE PRICING. THAT’S A TOTALLY DIFFERENT OUTCOME FROM PHYSICALLY BREAKING APART THESE ENORMOUS BEHEMOTHS. >>A LOT OF PEOPLE DON’T KNOW WHERE YOU’D EVEN START. WHEN WE TALK ABOUT INSTAGRAM, FACEBOOK. THOSE ARE MORE BY FORKATED THERE. WHEN WE TALK ABOUT GOOGLE. IT’D BE DIFFICULT. >>SHE’S DETERMINED. >>BOTH SIDES DETERMINED. NOW STATES JUST AS DETERMINED. THE STREAMING WARS, AS WE’RE TALKING BIG TECH, THAT WAR IS HEATING UP. APPLE REPORTEDLY COMMITTING MORE THAN $6 BILLION FOR RIGINAL PROGRAMMING AHEAD OF THE LAUNCH OF ITS NEW STREAMING SERVICE APPLE TV PLUS. ACCORDING TO THE FINANCIAL TIMES THE REPORT ADDS APPLE HAD INITIALLY PLANNED A $1 BILLION BUDGET. SO THIS IS QUITE A SIGNIFICANT LEAP, GUYS, IF YOU DO THE MAP. NEWS COMES AFTER THE COMPANY DROPPED THE TRAILER FOR ITS VERY FIRST ORIGINAL PROGRAM ON THE PLATFORM, THE MORNING SHOW STARRING JENNIFER ANISTON, REESE WITHERSPOON AND STEVE CARELL. >>GOOD MORNING. I’M BRINGING YOU SOME SAD AND UPSETTING NEWS. WHILE I DON’T KNOW THE DETAILS OF THE ALLEGATIONS. >>SHE’S THROWING ME UNDER THE BUS. >>MY CO-HOST AND PARTNER OF 15 YEARS WAS FIRED TODAY. [ SCREAMING ] >>OH BOY. WHAT DRAMA. >>SO DRAMATIC. >>WE HAVEN’T SEEN SUCH DRAMA SINCE LAST TIME. THE MONEY THAT THEY’RE SPENDING, APPLE HAS NOTABLY LARGE CASH POSITION SO THEY CAN DO IN. BUT IF YOU ARE LOOKING AT APPLE NOW AS A COMPANY THAT’S GOING TO BE GOING UP AGAINST A NETFLIX, AMAZON IN TERMS OF HOW MUCH THEY SPEND. DOES THAT SHIFT THE WAY PEOPLE SHOULD BE THINKING ABOUT APPLE? >>THEY ARE DEFINITELY DOUBLING DOWN ON THEIR PUSH TO BE MORE SERVICES ORIENTED. LESS HARDWARE RELIANT. THEY’RE TRYING TO PUT MORE MONEY INTO THIS. THE PRICE TAG SEEMS ON THE HIGH END CONSIDERING WHAT DISNEY IS LOOKING TO CHARGE FOR DISNEY PLUS. I KNOW THEY’RE PLANNING TO DO A FREE TRIAL BEFORE THEY DO AN ACTUAL SUBSCRIPTION SYSTEM. HOW MANY OF THOSE FOLKS ARE GOING TO ACTUALLY STAY ON FOR THE SUBSCRIPTION, THE CONTENT BETTER BE REALLY GOOD. THEY DON’T HAVE A LIBRARY YET. THEY HAVEA COUPLE OF DIFFERENT SHOWS THEY’RE PLANNING TO LAUNCH. IT’S A SMALL LIBRARY COMPARED TO THE LIKES OF A NETFLIX AND A DISNEY. IN THAT SENSE THEY HAVE REALLY, REALLY BIG COMPETITION IN THE SPACE AND I THINK THAT THE STREAMING SPACE IS GETTING SO CROWDED AND SO INTENSE THAT APPLE REALLY HAS TO PROVE THEMSELVES WITH THIS FIRST GROUP OF CONTENT THAT THEY’RE RELEASING. >>$6 BILLION IS A BIG NUMBER, BUT NETFLIX IS SPENDING $15 BILLION I THINK THIS YEAR ON CONTENT AND PIGGY BACKING TO YOUR POINT, THEY DO NOW HAVE A CATALOG OF THEIR OWN CONTENT. GOOD MOVE TRYING TO GET ENOUGH SERVICES. MAYBE NOT ENOUGH MONEY BEING SPENT ON IT THOUGH. >>THAT’S THE THING. WHEN YOU THINK ABOUT NETFLIX. THEY DON’T HAVE SUCH A STRONG CASH POSITION AND YOU’RE GOING UP AGAINST THE LIKES OF A DISNEY AND APPLE AND AMAZON ALREADY THERE. DOES THAT WORRY YOU MORE OR DO YOU THINK THAT THE FACT THAT APPLE HAS SO MUCH CASH THAT THEY MIGHT BE ABLE TO JUST CONTINUALLY SPEND. THERE IS A LIMIT TO THIS THEORETICALLY WHERE YOU DO HIT A POINT WHERE YOU CAN KEEP SPENDING AS MUCH MONEY AS YOU WANT ON A LISTERS, BUT YOU HAVE TO THINK THERE’D BE A DIMINISHING MARGINAL RETURN ON THAT EVENTUALLY. >>I THINK SO. DEFINITELY IT’S GOING TO COST THEM A LOT TO SEE THAT MUCH IN RETURN. SO THE RETURN ON INVESTMENT; RIGHT? THAT’S KEY HERE. HOW MUCH DO YOU HAVE TO PUT IN TO ACTUALLY START SEEING THAT BENEFIT. AND AT FIRST IT’S JUST GOING TO HAVE TO BE TRIAL AND ERROR. THEY DON’T KNOW HOW THESE SHOWS ARE GOING TO PERFORM WHEN THEY DO RELEASE THEM. ALL OF THAT IS KIND OF GOING TO BE REVEAL THE IN THE FALL WHEN WE SEE DISNEY PLUS ROLLED OUT AND ALL THE DIFFERENT STREAMING SERVICES AS WELL. I’M INTERESTED IN THIS. I KNOW YOU’RE NOT INTO THIS. >>NO, IT JUST SOUNDS LIKE A CASH HOLE. MAYBE IT’S MORE SEXY THAN A BUY BACK. BUT I’M NOT SURE. >>BUT THEY HAVE THE APPLE CARD COMING OUT. OTHER DIFFERENT SERVICES AS WELL. IT’S NOT JUST GOING TO BE THE TV PLUS. >>CALL ME AN OLD FASHIONED APPLE GUY. I JUST LIKE THE DIFFERENTIATING FACTOR OF NICE HARDWARE AND NOW HARDWARE. JUST TERRIBLE TO THINK ABOUT. ALL RIGHT. WELL WE’LL MOVE ON FROM BIG TECH. RETAIL IS IN FOCUS TODAY AFTER SOME BIG NAMES REPORTED QUARTERLY EARNINGS. FOR STARTERS, WE HAVE HOME DEPOT SOARING ON BETTER THAN EXPECTED PROFITS DESPITE LOWERING ITS OUTLOOK. THE HOME IMPROVEMENT STORE POSTING ADJUSTED EARNINGS OF $3.12 A SHARE ON REVENUE OF $30.84 BILLION. HEIDI, TOTAL SHARES CAME IN SHORT OF EXPECTATIONS. THE COMPANY DID EXPRESS WORRIES OVER POTENTIAL TARIFFS WHERE IF YOU’RE LOOKING AT THIS FROM A MACRO POINT OF VIEW THAT’S WHAT I THINK A LOT OF INVESTORS TOOK AWAY. >>IF IT WE LOOK AT THE STOCK TODAY, IT LOOKS LIKE A LOT OF INVESTORS ARE SHRUGGING OFF THAT TOP LINE MISS. A LOT OF WHAT MANAGEMENT SAID ON THE CALL THOUGH WAS YES, WE ARE SORT OF FRAMING THE OUTLOOK TO MITIGATE POTENTIAL COST PRESSURES FROM TARIFFS ON TO THE CONSUMERS BECAUSE THEY DON’T WANT TO PASS THAT ON. THEY’RE SAYING A LOT OF THEIR SUPPLIERS HAVE MOVED OUT. A LOT OF THEIR PRODUCTION FROM CHINA. BUT WHAT WE’RE SEEING IN HOME DEPOT’S QUARTER IS A LOT OF WHAT WE SAW IN THE FIRST QUARTER. LUMBER PRICE ISSUES, AS WELL AS POORER THAN EXPECTED WEATHER. WHEN IT’S REALLY WET IT’S HARD FOR THEM TO PRODUCE MORE LUMBER TO THEN SELL. SO THAT IS WHY WE’RE SEEING THOSE COST PRESSURES ON THAT FRONT. YES, ALL OF THE RETAILERS ARE SORT OF TRYING TO FIGURE OUT THE BEST WAY TO HANDLE THIS TARIFF SITUATION BECAUSE RIGHT NOW AT LEAST HOME DEPOT IS EXPECTING IF THE TARIFFS, THEY ARE GOING INTO PLACE IN SEPTEMBER. IF THE DELAYED ONES DO GO INTO PLACE ON DECEMBER 15th THEY’RE GOING TO SEE U.S. SALES HIT BY ABOUT $2 BILLION. THAT’S ALSO NOT A SMALL AMOUNT; RIGHT? THEY ARE DOING EVERYTHING THEY CAN AND I THINK WHAT MANAGEMENT SAID ON THE CALL KIND OF DID GIVE A LITTLE BIT OF RELIEF TO SOME OF THE WORRIES THAT INVESTORS AND WALL STREET ANALYSTS HAD GOING INTO THIS QUARTER. SO THAT MIGHT BE WHY WE’RE SEEING THE STOCK UP A LITTLE BIT TODAY. >>AT LEAST ENOUGH RELIEF TO SEE SHARES UP 4 POINT 5% FOR IT THE TIME BEING. AT LEAST THOSE CONCERNS BEING OUTWEIGHED BY THE POSITIVES THERE. ANOTHER NAME WE’RE WATCHING KOHL’S. REVERSING COURSE OVER CONCERNS. KOHL’S HOSTING ADJUSTED EARNINGS OF $1.55 A SHARE ON REVENUE OF $4.17 BILLION. A STRONG BACK TO SCHOOL SEASON AND PARTNERSHIP WITH AMAZON HELPED IT BEAT EARNINGS EXPECTATIONS. SALES STILL CAME IN WEAKER THAN EXPECTED. ANOTHER THEME CARRIED OVER FROM HOME DEPOT. ANN, WHEN WE LOOK AT THAT EARNINGS REPORT, IT’S TOUGH BECAUSE THIS IS ALWAYS THE CASE. WE HAD MACY’S WITH THE HUGE MISS AND WE SAW THAT STOCK FALL. KOHL’S WITH ANOTHER TOP LINE MISS. >>WHEN YOU ACTUALLY LOOK AT HOW THEY TALKED ABOUT WHERE THEIR GROWTH CAME FROM WITH BACK TO SCHOOL AND THE AMAZON PARTNERSHIP, THAT’S AN EXAMPLE OF SOMEONE WHO IS TRYING TO FIGURE IT OUT. THE FACT THEY DO HAVE 24 RETURN PROGRAM WITH AMAZON, THEY ARE TRYING TO GET THEIR ONLINE MERCHANDISING BACK UP TO PAR. IT WAS INTERESTING. ON THE ONE HAND YOU HAVE THE HOME DEPOT MANAGING THROUGH A TOUGH ENVIRONMENT. YOU HAVE OTHERS LIKE KOHL’S STARTING TO TALK ABOUT HOW THEIR MODEL CAN BE DIFFERENTIATED. >>NOT JUST SAYING YEAH, RETAIL IS WEAK, WEATHER’S TOUGH. AT LEAST TRYING TO DO SOMETHING, WHICH IS ALWAYS BETTER THAN NOTHING. LAST RETAIL COMPANY IS TJX COMPANIES. THE PARENT COMPANY OF DEPARTMENT STORE CHAINS MARSHALLS AND TJ MAXX. SHARES OFF ABOUT THREE QUARTERS OF ONE PERCENT AFTER FALLING SHORT OF ESTIMATES. REVENUE AND ADJUSTED EARNINGS PER SHARE. THIS ONE, WE TALKED ABOUT TWO TOP LINE MISSES. THIS ONE BOTTOM AND TOP LINE MISS. >>TJ MAXX WAS A REALLY GOOD PERFORMING COMPANY LAST YEAR. THIS YEAR IT JUST FROM THIS QUARTER IS T SOUNDS LIKE THE DEPARTMENT STORE STORY. THEY’RE SEEING DECREASED FOOT TRAFFIC. THEY ALSO MENTIONED THAT THEY HAD BALLOONING INVENTORY AS WELL, WHICH IS NOT GOOD BECAUSE YOU HAVE A LOT OF OLD STYLES IN STOCK YOU’RE NOT ABLE TO SELL. THAT WAS CONCERNING WHEN I WAS GOING THROUGH THE REPORT. >>BROADER TAKE AWAY FROM ALL OF THIS, ANN, WHEN WE TALK ABOUT THE STATE OF THE U.S. CONSUMER HERE. WE KEEP GETTING THESE UPDATES. THAT’S BEEN THE ONE PIECE THAT HASN’T SHOWN A LOT OF THAT PRESSURE WE TALK ABOUT WHEN WE TALK ABOUT RECESSION FEARS, THE U.S. CONSUMER BEING THAT ONE SHINING POSITIVE WHEN WE LOOK AT WEIGHING ALL OF THIS. DOES THIS KIND OF, THE NEW ROUND WE GOT TODAY. DOES THAT HELP SUPPORT THAT THEME OR ARE YOU SEEING CRACKS? >>I THINK EVERYONE IS LOOKING TO SEE WHAT EARNINGS SEASON IN THIS SPACE LOOKED AT. THE ONE THING I WILL SAY IS IT’S TOO SOON TO SEE WHETHER THE RECENT FED CUT IS GOING TO PLAY A ROLE. I THINK THIS IS AN INTERESTING DATA POINT FOR SEEING WHETHER THE GDP GROWTH WAS LIKELY TO CONTINUE. I THINK IT’S TOO SOON. Q3 IS A BIG ONE TO WATCH. >>THIS IS THE LAST DATA POINT WE’LL SEE WHEN WE TALK ABOUT J. POWELL SPEAKING AT JACKSON HOLE WHEN WE HAVE THAT COMING UP THIS WEEK. >>FRIDAY. >>THERE YOU GO. >>HOPEFULLY HE GIVES US SOMETHING. HOPEFULLY. >>HE’S GOING TO BE SIGNALING THAT SEPTEMBER RATE CUT DECISION COMING UP QUICKLY. >>>BEFORE WE HEAD TO BREAK, WANT TO HIGHLIGHT SOME OF THE NAMES WE TRACK ON THIS SHOW. WE’RE SEEING CANNABIS SHARES. AURORA CANNABIS UP IN THE GREEN UP BY 1.2%. WE’RE GOING TO BE CHATTING WITH THEM. NETFLIX SHARES OFF 3%. FACEBOOK AS WE NOTED, TECH IN THE SPOTLIGHT TODAY. FACEBOOK OFF CLOSE TO THREE QUARTERS OF ONE PERCENT. COMING UP, MORE ON THAT CARNAGE WE NOTED IN THE CANNABIS STATE AS CANOPY GROWTH NEAR AS 52 WEEK LOW AND ETF OFFICIALLY TURNS NEGATIVE FOR THE YEAR. BAD NEWS, AND YET BRUCE LINTON IS BUYING. JOIN US NEXT TO EXPLAIN WHY. YAHOO FINANCE IS LAUNCHING A NEW PODCAST SERIES TITLED THE ART OF THE EXIT. A TRUE CRIME PODCAST THAT TAKES YOU INSIDE THE WORLD’S MOST NOTORIOUS HEISTS. YOU CAN LISTEN TO THE ART OF THE EXIT ON APPLE PODCASTS OR WHEREVER YOU GET YOUR PODCASTS. YFi PM IS BACK IN IT TWO. >>>WELCOME BACK TO YFi PM. WE’RE TAKING A LOOK AT THIS BREATHER WE HAVE ON OUR HANDS RIGHT NOW. THE DOW OFF ABOUT 40 POINTS. THE NASDAQ OFF ABOUT .15%. WE’LL SEE WHERE THE MARKET ACTION TAKES US THROUGHOUT THE HOUR. WE’RE WATCHING SHARES OF CANADIAN CANNABIS COMPANY CAN TRUST HOLDINGS DOWN TODAY AFTER IT INFORMED SHAREHOLDERS IT WOULD SUFFER A RETURN. CANADIAN SHARES SLIPPING OFF A BIT MORE THAN 3% ON THAT NEWS. DEEPENING WHAT HAS BEEN A TOUGH STRETCH FOR THAT COMPANY FOLLOWING ITS CEO’S OUSTING FOR HIS ROLE IN UNLICENSED GROWING THAT VIOLATED CANADA’S DRUG LAWS. EVEN WITHOUT THAT MUCH CONTROVERSIAL THE SECTOR HAS BEEN HIT HARD OVER THE LAST FOUR MONTHS WITH CANOPY GROWTH FALLING 50% AND THE MJ ALTERNATIVE HARVEST IN THE RED FOR THE YEAR. FOR MORE ON THE STATE OF CANNABIS STOCKS. WE’RE JOINED BY BRUCE LINTON. >>I HAVE MANY MORE TIME. I CAN COME IN WHENEVE I WANT. >>IT’S BEEN A LONG TIME THOUGH. >>IT HAS. >>BEEN A BIT. WE WERE TALKING ABOUT THE MARKET ACTION WE’RE SEEING THERE. A TOUGH QUARTER THEY HAD LAST QUARTER. AT LEAST THAT WAS THE TICK ON THE STREET. I’M SURE YOUR TAKE’S DIFFERENT. REVENUE DECLINED COMPARED TO THE QUARTER BEFORE, WHICH WAS INTERESTING. >>I WASN’T ON THE CALL, OBVIOUSLY. WHEN I LOOK AT THE REVENUE, THEY DID SELL MORE MARIJUANA. THERE WERE SOME OTHER LINES THAT LOOKED LIKE THEY WERE A BIT LESS. I DON’T KNOW IF YOU WANT TO CALL IT CONCENTRATION OR QUALITY I THINK IS GOOD. THE QUARTER THOUGH, THE HEADLINES. THIS IS WHERE WE SHOULD HAVE TWO TYPE THE OF ACCOUNTING. >>SURE. >>PART OF WHICH YOU CARE ABOUT, WHEN CASH IS USED. PART WHICH YOU DON’T CARE ABOUT. STUFF LIKE STOCK OPTIONS OR WHEN YOU WRITE DOWN, IF I SAID OKAY, YOU CAN TAKE TWO YEARS LONGER TO PAY ME. >>YEAH, I KNOW, FOR SURE. >>THAT MEANS THERE’S A VALUE I TRANSFER TO YOU. IT DOESN’T REALLY AFFECT ANYTHING. THAT STUFF LIKE WAS A BILLION PLUS. >>I WANT TO BE CAREFUL ABOUT THIS. I FEEL LIKE WHEN TALKING TO YOU ABOUT CANOPY GROWTH IS LIKE TALKING ABOUT AN EX. THE RELATIONSHIP IS A LITTLE DIFFERENT. >>I THINK SHE BROKE UP WITH ME. I’M STILL DIGGING HER. >>YOU ARE. EVEN AFTER THAT QUARTER YOU SAID YOU WENT OUT AND BOUGHT STOCK IN CANOPY. TALKING ABOUT A 52 WEEK LOW. >>52 WEEK LOW IS A GOOD THING IF YOU’RE GOING TO BUY. IT’S BAD TO SELL. IF YOU LOOK AT THE QUARTER IF THEY SPENT THEIR MONEY ON BALLOONS AND PARTY FAVORS AND THERE WAS NO DURABLE VALUE, THAT’D BE A PROBLEM. BUT THEY CREATED A WHOLE BUNCH OF INTELLECTUAL PROPERTY, FILED PATENTS. SAW MORE SHIPMENTS GOING INTERNATIONAL. THEY’RE LOOKING LONG TERM AND IMPLEMENTING WHAT I THINK IS THE RIGHT PLAN WHICH IS TO CONTINUE TO CREATE DURABLE, DIFFERENTIATED PRODUCTS BECAUSE THEY’RE NOVEL AND PROTECTED. I LIKE THAT. IF YOU LOOK AT CANNABIS STOCKS, IF YOU PUT A CHART UP THAT SAID WHAT HAPPENS EVERY AUGUST. >>IT’S ALWAYS ROUGH. >>ALWAYS ROUGH. WHY? WHAT DO WE HAVE, 6, 700,000 SHAREHOLDERS. WHAT DO THEY DO ON VACATION. THEY DON’T BUY STOCKS. NAY JUST GO AWAY. SO THE EFFECT IS THE VOLUME OF TRADING GOES DOWN AND IT HITS THOSE STOCKS THE MOST. USUALLY THERE’S EVENTS IN THE FALL LIKE PEOPLE ROLLING OUT NEW PRODUCTS, REGULATIONS, ELECTIONS. THEY GO OH, THIS IS GOOD AND THE STOCKS GO UP. >>THERE’S A LITTLE BIT OF A SHIFT NOW TOO THOUGH WHEN WE úT THESE COMPANIES. I’D BE CURIOUS ON WHETHER OR NOT THIS QUARTER SEEMED LIKE A KITCHEN SINK HERE. TALKING ABOUT ADDING NONCASH CHARGES. SAYING THERE WAS THE RETURN FEES WE’RE TALKING ABOUT WHEN THEY HAD 8 MILLION CANADIAN COME BACK TO THEM. CAN THEY INCLUDED OPERATING COSTS FROM FACILITIES THAT AREN’T PRODUCING YET. I’M CURIOUS IF IT YOU THINK THIS IS A QUARTER WHERE THEY MAKE IT LOOK AS BAD AS IT’S GOING TO GET BEFORE A NEW PERSON IS NAMED YOUR OLD POSITION. >>I DON’T KNOW IF THEY DID THAT. I THINK IT WOULD BE PRUDENT TO DO THAT. WHEN YOU HAVE ONE THING, FLUSH AS MUCH AS YOU CAN. WHEN YOU GO FORWARD, MARGINS GO UP. BECAUSE YOU’VE CARRIED THAT STUFF. YOU’VE WASHED OUT ANY KIND OF NONCASH EVENT. I DON’T KNOW IF THEY DID THAT. I WOULD DO THAT. >>AND IF YOU’RE THE NEXT GUY COMING IN YOU’D PROBABLY WANT THAT TOO. >>LET’S HOPE IT’S THE NEXT LADY COMING IN. >>HAVE YOU HEARD ANYTHING? >>I DON’T. I HAVE NO IDEA. MY VIEW IS IT’D BE A GREAT HIRE TO HAVE SOMEONE WHO IS FEMALE IN TECH BACKGROUND. THE REASON IS THE CANNABIS SPACE IS FOR A WHOLE BUNCH OF REASONS VERY MALE LED. >>WE’LL BE TALKING ABOUT THIS LATER ON IN THE SHOW. >>TECH IS AN INTERESTING THING. TECH IS VERY ABOUT SCALING WITH CONFIDENT PEOPLE. AND WHEN YOU THINK ABOUT TECH, YOU DON’T THINK ABOUT HOW DO I WIN IN LIKE NEW JERSEY AND NEW YORK. YOU THINK ABOUT HOW TO WIN GLOBALLY. THIS IS WHAT THIS IS ABOUT. >>BRUCE, LAST YEAR IT WAS REALLY FUN BEING A CANNABIS INVESTOR. THE STOCKS WERE FLYING HIGH. EVERYONE WAS BUYING INTO THE SPECULATION THAT REGULATORY CONCERNS, WHATEVER, EVERYTHING WAS GOING TO BE GREAT FOR STOCKS GOING FORWARD. THIS YEAR, NOT SO HOT. IT’S HARD OUT THERE TO BE AN INVESTOR IN CANNABIS STOCKS. ARGUABLY IT’S BECAUSE THE STOCKS ARE TRADING MORE ON THE FUNDAMENTALS NOW. BREAKING APART THE FINANCIALS. >>QUARTER BY QUARTER. >>EXACTLY. AS AN INVESTOR IF YOU WANT TO INVEST IN THE CANNABIS SPACE, WOULD YOU RECOMMEND GETTING IN NOW? WOULD YOU SAY THIS IS AN OPPORTUNITY TO BUY? >>I’D SAY CAREFULLY. >>WHAT ARE THE CATALYSTS TO TAKE THE STOCKS HIGHER WITH. >>THERE’S THREE THINGS. YOU HAVE TO PICK WHAT AM I DOING FOR GLOBAL EXPOSURE AND DOING FOR U.S. EXPOSURE. I THINK YOU WANT BOTH. THEY’RE GOVERNED DIFFERENTLY. YOU MIGHT SAY WHO IS OPERATING IN MORE THAN FIVE COUNTRIES AND RUN DOWN A LIST ON THAT. IN THE U.S., I’VE GONE AROUND TO A LOT OF PLACES TO LOOK AT THINGS. I WANT TO UNDERSTAND WHERE ARE THEY ON THE GETTING IT DONE SPECTRUM. FOLKS ARE GETTING LOW ON CASH AND GETTING OVEROPTIMISTIC ON POSITIONING. THEY START TALKING ABOUT HOW MUCH THEY’RE GOING TO YIELD. IF YOU’RE GOING TO INVEST, I WOULD WANT TO SEE SOMEBODY WHO HAS DEPTH IN ONE STATE AND THEN ADD TO IT. BECAUSE THERE’S AN OPPORTUNITY TO WIN BUT YOU CAN’T TRY TO WIN EVERYWHERE AT ONCE. YOU HAVE TO GET SOME STRENGTH. I’M SEEING SOME GOOD SINGLE MULTISTATE, TWO, THREE, FIVE STATE GUYS DOING A GOOD JOB. I LIKE EXTRACTION. YOU’RE MOVING ABOVE JUST GROWING THE PLANT AS AN INGREDIENT. MAKE INTERESTING PRODUCTS, I LIKE BRANDS THAT AREN’T. BUT THE ONLY THING I’VE SEEN THAT’S BRANDED BUD IS THIS BRAND CALLED COOKIES. I DON’T KNOW IF YOU’VE SEEN IT. IT’S ONE OF THOSE THINGS THAT POP WILL GO A LONG WAY TO BUY IT AT A PREMIUM PRICE. >>OR THE PRODUCT? >>COOKIES. THE BRAND AND PRODUCT. THEY’VE DONE A GREAT JOB. POSITIONING THE PRODUCT. IT IS ONE OF THOSE ONES THAT’S BEEN THE BIGGEST SURPRISE. >>THE SHIFT TO MORE PRODUCTS DERIVED PRODUCTS WHEN WE’RE TALKING ABOUT VAPES, GREEN LINE HOLDINGS. THE PARTNERSHIP WITH CANOPY. I’M NOT SURE IF THAT’S ONE YOU’RE LOOKING AT AS WELL. >>I LOOKED AT THEIR STOCK. I LIKE THEM, I LIKE WHAT THEY DO. PART OF THE REASON THEY’RE GETTING A SQUEEZE IS THEY HAD A WHOLE LOT OF VAPE NICOTINE REVENUE IN THERE. IF THAT’S A BIG CHUNK OF YOUR REVENUE, THE QUESTION IS THAT GOING TO ROTATE OVER, IS MARGIN GOING TO GO DOWN. >>YOU TALKED ABOUT BEFORE YOU WERE LET GO FROM YOUR POSITION THERE. >>SOME DAY YOU’LL GET FIRED. IT’S MUCH LESS BAD THAN YOU THINK. >>I FEEL LIKE IT MIGHT BE TOMORROW. WHEN WE TALK ABOUT THIS THOUGH, BEFORE YOU LEFT CBD WAS THE BIG PUSH. YOU WERE SAYING THIS WAS GOING TO BE, YOU WERE GOING TO BE MARKET SHARE LEADERS OF CANOPY GROWTH. >>IN THE U.S. >>NOW IT’S ALMOST SEPTEMBER. >>NO, NO, I THINK. I LISTENED TO THE CALL. I THOUGHT THEY WERE FAIRLY CLEAR THAT BEFORE THE END OF THE YEAR THEY PLAN TO BE LAUNCHING THE CBD PRODUCTS IN AMERICA. WHAT THEY WERE, I THINK THEY MADE REFERENCE TO IS THE FINAL PIECES ARE WHICH RETAIL CHANNELS. THAT SOUNDS LIKE PEOPLE PROGRESSING AGAINST A GOAL. A TIMELINE AND A REVENUE. I KNOW THE PEOPLE RUNNING THE CANOPY CBD STUFF FOR THE U.S. INCREDIBLE TEAM. IF ANY COMPANY CAN CRUSH IT ON THIS TOPIC MAKING PRODUCTS THAT ARE CONSISTENT, THAT ARE DONE PROFESSIONALLY AND MEET THE STANDARDS, IT’LL BE THESE GUYS. >>FAIR ENOUGH. WHAT’S NEXT? >>HERE’S THE CIRCUMSTANCE. I HAVE ENOUGH MONEY THAT I’M OKAY, BUT I DON’T HAVE ENOUGH CREDIBILITY THAT I CAN WASTE IT. I’M LOOKING AT EACH OF THE COMPANIES CAREFULLY AND PICK FOUR COMPANIES THAT WILL GIVE ME GLOBAL COVERAGE, INCLUDING ANIMAL CARE. I HAVE TO MAKE SURE IF I INVEST AND WORK WITH THEM OVER THE NEXT TWO YEARS WE CREATE VALUE. I DON’T WANT TO HAVE ANYTHING THAT’S TRADING QUICKLY. WHATEVER I GO INTO, I’M NOT GOING TO SELL ANY STOCK I BUY OR GET IN THE FIRST YEAR. >>YEAH. AND IT’LL BE IN THE U.S. >>YEAH, IT’LL BE U.S. >>FAIR ENOUGH. BRUCE, THANK YOU FOR STOPPING BY. APPRECIATE IT. >>>WHAT WE’RE WATCHING, OTHER MOVERS TODAY. BEYOND MEAT UP OVER 5%. THE COMPANY FINALLY EARNING THE ENDORSEMENT OF A SINGLE BULLISH ANALYST AND THE STOCK SEEMS TO BE UP ON THAT. HEDI CHUNG, YOU’VE BEEN WATCHING THIS. >>JP MORGAN’S KEN GOLDMAN. HE COVERS THE STOCK FOR THE FIRM. HE’S FINALLY BULLISH ON IT ONCE AGAIN. WHEN HE FIRST INITIATED COVERAGE IN MAY HE HAD AN OVERWEIGHT RATING WITH A $97 PRICE TAG. HE’S TEETERED BACK AND FORTH BETWEEN NEUTRAL AND OVERWEIGHT FOR A LOT OF DIFFERENT REASONS. ONE OF THEM WAS VALUATION. HE SAID I CAN’T JUSTIFY THE WAY THAT THE STOCK IS TRADING AND HOW FAR THE VALUATION HAS BALLOONED. SO HE TOOK DOWN HIS RATING TO NEUTRAL AT THE TIME AND NOW HE’S FINALLY BULLED UP ON IT AGAIN. THE REASON WHY IS LOOK HOW MUCH THE STOCK HAS COME DOWN FROM ITS PEAK. JULY 26th IT WAS TRADING AT ITS ALL TIME HIGH OF $239.71. SOMEWHERE SURE. >>IT’S COME DOWN A LOT SINCE THEN. SO HAS THE VALUATION. IT’S TRADING ABOUT 25 TIMES ESTIMATED 2020 SALES. HE SAYS THAT’S MORE REASONABLE NOW. IT’S BULLED UP ON IT ONCE AGAIN. IT’S A GROWTH STORY. IT’S NOT YET PROFITABLE. IT’S ONE OF THOSE COMPANY WHERES VALUATION ISN’T NECESSARILY ESTIMATED THE SAME WAY AS OTHER TRADITIONAL PACKAGED FOOD COMPANIES ARE. SO VALUATION IS ONE OF HIS REASONS FOR UPGRADING THE STOCK. AS WELL AS HE SEES MORE AGGRESSIVE WARTER INSHIPS WITH FOOD SERVICES AND RESTAURANTS. I KNOW YOU’RE ONE OF THE ONES THAT BELIEVES McDONALD’S WILL BE ONE OF THE QSRs TO SIGN WITH BEYOND MEAT. >>McDONALD’S GOT TO DO SOMETHING. >>IF IT THEY CAN GET THAT PARTNERSHIP, THAT’S HUGE FOR BEYOND. ESPECIALLY AS IMPOSSIBLE FOODS IS LOOKING TO ENTER THE GROCERY SPACE. THAT’S GOING TO GIVE BEYOND MEAT A RUN FOR ITS MONEY BECAUSE RIGHT NOW IT’S JUST BEEN DOMINATING THE GROCERY AND FOOD. >>ANN, WOULD YOU AGREE WITH THIS? IT’S COME DOWN A BIT. BUT IT’S STILL UP QUITE A BIT. $46 WHERE IT STARTED. IS THAT ENOUGH IN YOUR MIND? >>I THINK IT’S 20 PLUS TIMES REVENUE IS VERY TOPE. THE COLLABORATION THEY’VE COME OUT WITH THE FOOD SERVICE BASE HAVE BEEN IMPRESSIVE. AT THE END OF THE DAY I THINK IT’S CURIOUS TO SEE HOW MUCH SHELF SPACE THEY’RE GOING TO TAKE. THEY’RE GOING INTO MEAL KITS. I THINK THE LITMUS TEST IS WHEN YOU’RE GOING TO THE GROCERY STORE HOW MUCH ARE YOU TURNING TO BUY THEIR PATTIES. >>SINCE WE TRIED IT ON IPO I HAVE NOT GONE BACK AND BOUGHTEN BEYOND MEAT PATTIES.>>I DON’T EITHER. >>THAT’S A GOOD REMINDER. PLUS WE’VE HAD THE IMPOSSIBLE WHOPPER SINCE THEN AND REMEMBER HOW THAT WAS. TOPNOTCH. WELL, WE’LL LEAVE THAT THERE. WE HAVE TO CHECK IN WITH SCOTT GAMM ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. >>HEY THERE. AFTER THREE STRAIGHT GAINS FOR THE STOCK MARKET WE ARE TAKING A LITTLE BIT OF AFTER BREATHER TODAY AS THIS WEEK REALLY SHIFTS INTO FULL ON FED MODE WITH THE MINUTES OF THE FED’S JULY MEETING RELEASED TOMORROW AND OF COURSE FEDERAL RESERVE CHAIR JEROME POWELL’S SPEECH LATER THIS WEEK IN JACKSON HOLE, WYOMING. TODAY YOU DO HAVE YIELDS LOWER WITH THE TEN YEAR TREASURY YIELD AT ABOUT 1.55%. YESTERDAY IT WAS AT 1.6%. ALTHOUGH THE TWO YEAR YIELD IS STILL BELOW THE 10 YEAR YIELD. NO INVERSION TO WORRY ABOUT AT LEAST FOR TODAY. WE ARE SEEING MORE OF A REACTION IN INDIVIDUAL STOCKS BECAUSE IT IS STILL EARNINGS SEASON EVEN THOUGH EARNINGS HAVE BEEN WINDING DOWN FOR THE MOST PART. AND TO GIVE YOU A SENSE OF JUST HOW, YOU KNOW, PROMINENT THE WINNERS AND LOSERS IN RETAIL ARE TODAY, JUST LOOK AT THE BEST PERFORMING S&P 500 STOCK TODAY. HOME DEPOT AND THE WORST PERFORMING S&P 500 STOCK, KOHL’S. BOTH REACTING TO THEIR INDIVIDUAL EARNINGS REPORTS. WITH HOME DEPOT WE DID HAVE BETTER THAN EXPECTED EARNINGS. THE COMPANY DID LOWER ITS GUIDANCE FOR THE YEAR CITING TRADE WORRIES. INVESTORS SEEM TO BE SHRUGGING THAT OFF AS THE STOCK IS UP ABOUT 5%. WITH KOHL’S YOU DID HAVE A REVENUE MISS AND SAME STORE SALES DID DECLINE BY A LARGER THAN EXPECTED MAGNITUDE AS THE COMPANY, OF COURSE, CONTINUES TO NAVIGATE THE CHALLENGING RETAIL ENVIRONMENT THAT HAS PLAGUED A LOT OF RETAILERS FOR YEARS NOW. >>SCOTT GAMM, WE’LL CHECK BACK IN WITH YOU LATER ON IN THE SHOW. BUT NEXT ON YFi PM. AURORA CANNABIS CLOSING ON A NEW HEMP PARTNERSHIP. THEIR CHIEF CORPORATE OFFICER JOINS US NEXT WITH MORE ON WHAT THE WEED GIANT HAS IN STORE. >>>WE’LL HEAD TO THE U.S. OPEN FOR A LIVE LOOK AT THE TOURNAMENT WITH MORE THAN $57 MILLION IN PRIZE MONEY UP FOR GRABS RIGHT AFTER THIS. >>>GOO AFTERNOON AND WELCOME TO YFi PM. I’M ZACK GUZMAN. JOINING ME TODAY, HEIDI CHUNG AND ANN BERRY. THANK YOU SO MUCH FOR BEING HERE. APPRECIATE IT. IT’S A BUSY TUESDAY. I KNOW YOU GOT A LOT OF PLACES TO BE. MAYBE ANN MORE THAN HEIDI. WE’RE CHECKING THE MARKET ACTION WE’RE SEEING. DOWN MORE THAN 50 POINTS. S&P DOWN ABOUT 8. THE NASDAQ DON .2% RIGHT NOW. AURORA CANNABIS IS MAKING A PUSH INTO HEMP OFFICIAL. ANNOUNCED IT HAS COMPLETED ITS ACQUISITION OF HEMP CO FOOD AND FIBER. JOINING US NOW TO DISCUSS THIS IS AURORA CANNABIS CCO CAM BATLY. >>GOOD TOO SEE YOU AGAIN. >>THANKS FOR COMING OUT HERE. I KNOW YOU TRAVEL QUITE A BIT. >>A LITTLE. >>ALWAYS TRYING TO KEEP YOUR FINGERS ON WHAT THIS COMPANY IS DOING. NOW THE PUSH INTO HEMP HERE. CURIOUS AS TO WHY THE BIG PUSH FOR YOU INTO HEMP. >>I’LL TELL YOU WHY. WE BELIEVE THAT HEMP IS GOING TO BE AN ENORMOUS GLOBAL BUSNESS. WE WILL HAVE MORE TO SAY ABOUT THAT, PARTICULARLY IN U.S. CONTEXT QUITE SOON. HEMP IN AND OF ITSELF IS A TREMENDOUS ECONOMIC OPPORTUNITY FOR THE CBD CERTAINLY, BUT ALSO FOR THE PROTEIN YOU’RE ABLE TO RECEIVE FROM THIS PLANT. UNLIKE A LOT OF PLANTS IT’S HIGH IN PROTEIN. YOU CAN MAKE BUILDING MATERIALS OUT OF HEMP. ALONG WITH OUR CANNABIS BUSINESS WE SEE AN ENORMOUS ECONOMIC OPPORTUNITY IN HEMP. WE’LL BE PURSUING THAT. >>WE GOT THE UPDATE FROM KRONOS AND THEIR CEO WAS SAYING THE MARKET MIGHT DWARF WHAT THEY’VE SEEN IN THE MARIJUANA SPACE. DO YOU SEE THE CBD MARKET EVENTUALLY TAKING OFF. SOME PROJECTIONS ARE $23 BILLION. >>IT’LL BE USED IN DIFFERENT WAYS. WE FORSEE CBD IN A LOT OF CONSUMER PACKAGED GOODS. CANNABIS ITSELF ON A MEDICAL AND CONSUMER BASIS IS GOING TO BE AN ENORMOUS BUSINESS. WE MIGHT BE GETTING AHEAD OF OURSELVES TO BE PROJECTING RIGHT NOW WHICH IS GOING TO BE THE BIGGER. BUT I’M NOT GOING TO DISAGREE. WHAT’S IMPORTANT FOR US RIGHT NOW AS A COMPANY IS TO CONTINUE DOING WHAT WE’RE DOING. WE THINK WE’VE MADE MORE RIGHT MOVES THAN ANYBODY ELSE IN THIS SECTOR. IT’S PAYING OFF. YOU MIGHT HAVE SEEN OUR GUIDANCE A COUPLE WEEKS AGO WHERE WE ANNOUNCED WE’RE GUIDING TO OVER 100 MILLION CANADIAN IN REVENUES. BETWEEN 100 AND 107 MILLION. SO WHAT THAT MEANS, AND THIS IS A BIG SIGNAL DATE FOR US. IS THAT WE’VE EMERGED NOW AS THE LEADING PRODUCERS AND SELLERS OF CANNABIS IN THE WORLD. >>THAT’S BIG. >>IN ADDITION TO HAVING THE BIGGEST GLOBAL FOOTPRINT BECAUSE WE’RE OPERATING IN 25 COUNTRIES. THAT IS SIGNIFICANT. JUST A YEAR AND A HALF AGO WE HAD 5000-KILOGRAMS ON AN ANNUAL RUN RATE. WE’VE NOW SURPASSED THAT PAST 150,000. SO THIS IS AN ENORMOUS SHIFT IN THE INDUSTRY. >>I WANT TO HIGHLIGHT THAT THOUGH. IT IS ONE GOOD THING TO POINT TO MARKET SHARE AND STEALING THAT AWAY. WHEN YOU DO TALK ABOUT ALL THAT PRODUCTION BEING INCREASED. THERE IS SOME CONCERN THAT IT’S BECOMING A COMMODITY IN THE CANADIAN MARKET BECAUSE YOU HAVE SO MUCH CANNABIS STOCKPILED NOW. NOT JUST YOU GUYS BUT COMPANIES ACROSS THE BOARD. >>CAN I TELL YOU AN INDICATION IT’S NOT BECOMING A COMMODITY. SOME COMPANIES HAVE HAD CHALLENGES FROM SIGNIFICANT RETURNS FROM THE GOVERNMENTS THAT HAVE HAD UNSELLABLE PRODUCT. THEY’VE SENT IT BACK TO THE PRODUCERS. WE’VE HAD VIRTUALLY NO ISSUE WITH THAT. WE FOUND THAT OUR BRANDS, AURORA BRANDS PLUS OUR MED RELIEF BRANDS ARE LEADING THE WAY. WE’VE TAKEN OVER THE LEAD IN THE CANADIAN CONSUMER MARKET AS WELL. THERE IS SOME INDICATION THERE IS DISCRIMINATION FOR QUALITY. WE’VE ALWAYS FELT THAT QUALITY IS KING. THAT’S WH WE PRODUCE WITH SUCH HIGH QUALITY. >>I WANT TO TALK ABOUT NELSON PELTZ. WHEN HE WAS FIRST ANNOUNCED AS A STRATEGIC ADVISOR. HE’S A VETERAN IN THE CONSUMER GOOD SPACE. A LOT OF PEOPLE WERE SPECULATING THAT’S THE DIRECTION AURORA IS LOOKING TO GO IS TO SPREAD THEIR WINGS AND BE HEAVY IN THE CONSUMER SPACE. IS THAT TRUE? TO PUT HEMP IN A LOT OF CONSUMER GOODS. >>YOU’RE NOT WRONG TO SAY THAT NELSON IS A GIANT IN CONSUMER PACKAGED GOODS. SO THAT MUCH IS CERTAINLY TRUE. BUT HIS SKILLS, EXPERTISE, CONTACTS AND WISDOM GO BEYOND THAT. IT’S NOT WRONG TO SAY WE’RE WORKING WITH HIM IN TERMS OF OPPORTUNITIES IN TERMS OF CONSUMER PACKAGED GOODS. WE’RE ALSO LOOKING AT OPPORTUNITIES ACROSS ALL OF THE VERTICALS THAT ARE BEING DISRUPTED BY CANNABIS OR WHERE CANNABIS IS CREATING WHOLLY NEW ENHANCED OPPORTUNITIES. EVERYTHING FROM PHARMA TO BREWING AND DISTILLING AND WELLNESS AND BEAUTY AND COSMETICS. THE OPPORTUNITIES ARE THERE. AND WE’RE NOT LIMITING IT. >>IF YOU DO SEE THAT REAL GROWTH THOUGH IN THE CBD SPACE AND ALL THESE OTHER OPPORTUNITIES NOW, IT’S BEEN A BIT OF A BACK AND FORTH BETWEEN A COMPANY TRYING TO PUSH REALLY HARD IN THE SHORT TERM AND SUFFER THE UNPROFITABLE QUARTERS. WE’VE SEEN CANNABIS COMPANIES GET PUNISHED FOR THAT. THERE’S OTHER ONES SAYING IT’S FINE, WE’LL TURN IT AROUND IN THE SHORT TERM BUT LONG TERM WE’LL BE FINE. IT’S TAKEN AURORA LONGER THAN I THINK SOME INVESTORS WOULD HAVE WANTED TO SEE AN ENTRANCE INTO THE U.S. MARKET, ESPECIALLY AFTER CANOPY MADE THEIR MOVE. WHY SO LONG THOUGH? >>COUPLE THINGS. THERE IS A TENDENCY TO FOLLOW THE LEADER IN THIS SECTOR. CANOPY DID THEIR THING AND CRONOS DID THEIR THING. ONE IS CONTROLLED BY A DISTILLER. ANOTHER IS CONTROLLED BY A TOBACCO COMPANY. WHAT HAVE WE SAID CONSISTENTLY FOR OVER A YEAR IS WE DON’T WANT TO BE CONTROLLED BY ANYBODY ELSE. MORE THAN THAT WE SEE OPPORTUNITIES TO PARTICIPATE IN MULTIPLE VERTICALS. THERE’S NOBODY AT THE OUTSET OF THIS NEW INDUSTRY WHO SAYS WE CAN’T DO THAT. WE MEASURE TWICE, WE CUT ONCE. WE’RE CONFIDENT IN THE PATH WE’RE PROCEEDING WITH. I THINK OUR STRATEGY HAS BEEN COMPLETELY VALIDATED THUS FAR. I’M HOPING IN A YEAR WHEN WE’RE SITTING DOWN AGAIN I’LL SAY THE SAME THING. >>I HOPE YOU BRING THE NEWS WHEN YOU DO MAKE THAT ENTRANCE TOO. >>WE’LL BE HERE WHEN WE HAVE ANNOUNCEMENTS FOR SURE. >>CCO AT A COMPANY UP ON EARNINGS DAY. APPRECIATE IT. >>>TODAY MARKS DAY TWO OF QUALIFYING ROUNDS FOR THE HIGHLY ANTICIPATED U.S. OPEN TENNIS TOURNAMENT. YAHOO FINANCE’S BRIAN SOZZI IS OUT THERE. >>REAL TOUGH ASSIGNMENT. THIS IS IN ADDITION TO THE SECOND DAY OF QUALIFYING, THIS IS FAN WEEK. FOR FOLKS ON WALL STREET LOOKING FOR AND CALLING FOR A RECESSION, I HAVE TO BE HONEST. I JUST DON’T SEE IT HERE. CROWDS ARE BUILDING. AND CERTAINLY A LOT OF PEOPLE ARE OUT THERE IN THE CONCESSION STANDS SPENDING AWAY ON BIG TICKET ITEMS. WE PUT THE RECESSION QUESTION TO THE CHIEF REVENUE OFFICER AT THE USTA. >>WE’RE FORTUNATE. I THINK IF YOU THINK BACK TO 2007, 2008, LOTS OF FOLKS IN SPONSORSHIP TALKED ABOUT FLIGHT TO QUALITY. YOU DIDN’T WANT TO GIVE UP YOUR U.S. OPEN SPONSORSHIP OR YOUR BROADCAST RIGHTS OR EVEN YOUR TCKETS OUT OF FEAR YOU MAY NEVER BE ABLE TO GET THEM BACK. YOU’VE BEEN ON THAT WAITING LIST, YOU’RE A SEASON TICKETHOLDER. WE DIDN’T EXPERIENCE IT THE WAY OTHERS DO. WE ALSO HAVE A LOT OF LONG TERM CONTRACTS THAT ARE ALL STAGGERED OVER TIME. WE TRY TO PROTECT OURSELVES FOR THAT. WE DON’T TAKE OUR POSITION LIGHTLY. WE’RE CONTINUING TO INVEST TO MAKE SURE THERE’S VALUE AT WHATEVER PRICE YOU EXPERIENCE THE U.S. OPEN THERE NEEDS TO BE THE GREATEST VALUE IN SPORTS AND ENTERTAINMENT. >>BEFORE WE LET YOU GO. WHO WINS THE MENS AND WOMENS? >>WHAT I CAN TELL YOU IS THERE WILL BE A CHAMPIONSHIP HERE FOR MEN AND FOR WOMEN. THERE’S A CHAMPIONSHIP SEASON EVERY YEAR HERE. WE’RE HUGELY EXCITED. >>WELL PLAYED, SIR. THANKS FOR JOINING US. >>THANKS FOR HAVING US. >>SO IT’S NOT JUST THE CORPORATE SPONSORS THAT APPEAR TO BE HOLDING UP WELL OR SPENDING BIG AT THIS TOURNAMENT. THE ATTENDANCE LEVELS OVER THE NEXT TWO WEEKS COULD SIGNIFICANTLY OUTPASS THE RECORD LEVELS OF 2018. ON THE SIDELINES I JUST GOT OFF THE PHONE WITH HOME DEPOT’S RETIRING CFO. QUOTE, WE DON’T SEE A RECESSION. >>STRAIGHT FROM THE MOUTH OF THE OVERALL PUBLIC AT THE U.S. OPEN. THANK YOU SO MUCH. APPRECIATE IT. BEFORE WE GO TO BREAK WE WANT TO TAKE A LOOK AT THE DOW LEADERS SO FAR TODAY ON THIS DOWN DAY IN THE DOW. HOME DEPOT, APPLE, DISNEY, McDONALD’S AND VISA LEADING THE WAY IN TERMS OF PERFORMANCE THERE. ON THE FLIP SIDE, DOW LAGGARDS EASIER TO FIND. DOW CHEMICAL, IMB LEADING THE WAY LOWER. >>>THE BIG BUSINESS OF BOURBON IN FOCUS AS TRADE WORRIES ENDANGER A KEY U.S. EXPORT. WE’LL CHAT WITH THE FIFTH GENERATION PRESIDENT OF OLD FORESTER AS THE BOURBON BRAND TURNS 150 YEARS OLD. IS THE CATEGORY OVERALL CONNECTING WITH YOUNGER DRINKERS? THE ANSWER WHEN YFi PM RETURNS. >>>WELCOME BACK TO YFi PM AS WE CHECK THE MARKET ACTION. THE MAJOR INDICES STILL IN THE RED FOR NOW. THE DOW LOSING MORE STEAM OFF 73 POINTS. WE’LL SEE WHERE WE GO AS WE APPROACH 2:00 P.M. EASTERN TIME. >>>WE’VE BEEN COVERING A LOT OF CANNABIS COMPANIES TODAY. THERE WAS ONE THING I COULDN’T HELP BUT NOTICE WHEN WE WERE TRYING TO BOOK CEOs FOR OUR BUSINESS OF CANNABIS SPECIAL A FEW MONTHS AGO IF IT YOU DID TUNE IN TO THAT. WE TRY TO INCORPORATE DIFFERENT VIEWPOINTS, DIFFERENT BACKGROUNDS AND YES, DIFFERENT RACES. BUT THAT HAS PROVEN MORE DIFFICULT THAN USUAL WHEN IT COMES TO CANNABIS COMPANIES WHICH PROMPTED ME TO LOOK AT WHO IS ACTUALLY RUNNING THESE COMPANIES. RESULTS ARE SOMEWHAT STAGGERING. LOOKING AT THE TOP TEN CANNABIS COMPANIES THE BOARDS ARE LESS DIVERSE THAN THE OVERALL FORTUNE 100 COMPANIES. AT JUST ABOUT A 3% MINORITY REPRESENTATION RATE, THE TOP CANNABIS COMPANIES TRAIL THE 20% AVERAGE POSTED BY THE FORTUNE 100 BY A FACTOR OF 6. THERE’SLESS FEMALE BOARD REPRESENTATION THAN AVERAGE AS WELL. CONSIDERING THE CONVERSATIONS THIS COUNTRY IS HAVING AROUND MARIJUANA LEGALIZATION, CRIMINAL JUSTICE REFORM, RACE AND PARTICULARLY HOW REVENUES SHOULD BE REDIRECTED TO COMMUNITIES OF COLOR, IT’S AN IMPORTANT POINT TO REALIZE. AT A TIME WHEN A BLACK MAN IN AMERICA IS NEARLY FOUR TIMES AS LIKELY TO GET ARRESTED FOR MARIJUANA POSSESSION THAN A WHITE MAN ACCORDING TO AN ACLU STUDY. A TIME WHERE HISPANICS INSTITUTE 60% OF ALL FEDERALLY SENTENCED MARIJUANA OFFENDERS. YOU CAN’T HELP BUT WONDER HOW THAT MIGHT PLAY OUT. ONLY TWO WERE MINORITIES. BOTH BLACK MEN. SO JOINING US NOW FOR MORE ON THIS IS ONE OF THE MEN, BOARD MEMBER AT NEW BRUNSWICK-BASED COMPANY. DEXTER JOHN. I WAS PERSONALLY SHOCKED WHEN I LOOKED INTO THE NUMBERS HERE. YOUR COMPANY IS ONLY ONE OF TWO IN THE TOP TEN WITH DIVERSITY ACTUALLY IN THE BOARD ROOM. WHY DO YOU THINK THE NUMBERS ARE SO LOW? >>IT’S LOW FOR VARYING REASONS. MORE SO THAT I THINK WE STILL LIVE IN A TIME WHERE IT’S ABOUT NEPOTISM, WHO YOU KNOW. I BELIEVE A LOT OF THESE BOARDS ARE STILL COMPRISED OF WHITE MALES AND THEY MORE OR LESS GO AND GRAVITATE TOWARDS PEOPLE THAT LOOK LIKE THEM, ACT LIKE THEM AND THINK LIKE THEM. >>WHEN YOU TALK ABOUT THE WAY THAT YOU PERSONALLY CAME TO BE ATTACHED TO ORGANIGRAM. YOU WERE LOOKING INTO CBD AND THIS STUFF ABOUT THE WAY THAT THESE PRODUCTS ARE USED. I’D BE CURIOUS TO GET YOUR PERSONAL TAKE ON HOW YOU GRAVITATED TOWARDS THE CANNABIS SPACE AND HOW YOU NAVIGATED JOINING THE BOARD OF ONE OF THESE COMPANIES. >>YEAH, WELL, I’VE BEEN VERY FORTUNATE IN MY CAREER I’VE BEEN CHAIRMAN OF A PUBLIC COMPANY BEFORE AND DEFINITELY WORKED WITH VERY SMART INDIVIDUALS. ORGANIGRAM WAS A COMPANY THAT WAS ON MY RADAR I GUESS TWO, THREE YEARS AGO WHEN A BOARD COMPANY OF ANOTHER COMPANY I SAT ON CONTACTED ME ABOUT IT. I DID THE RESEARCH. IT WAS STILL TOO EARLY. FOLLOWING YEAR THEY REACHED OUT TO ME. I WENT TO THE FACILITY, MET WITH THE MANAGEMENT AND THE OTHER BOARD MEMBERS. I CLEARLY SAW WHAT THEY WERE TRYING TO ACCOMPLISH AND DO WAS, I DON’T WANT TO SAY GROUND BREAKING BUT DEFINITELY FORWARD THINKING. THEY BELIEVE THAT YOU WANT TO HAVE A BOARD THAT REPRESETS CANADA AND CANADA IS NOT MADE UP OF WHITE 80-YEAR-OLD MEN. WHAT WE WERE TRYING TO DO HERE IS TO HAVE A BOARD THAT REPRESENTS CANADA NOW AND IN THE FUTURE IN TERMS OF RACE, GENDER, ETHNICITY, RELIGION, ALL THOSE AREAS WE’RE TRYING TO EMBRACE AND TRY TO BE AS INCLUSIVE AS POSSIBLE. >>FROM YOUR EXPERIENCE WE’VE SEEN SOME OTHER COMPANIES THAT DON’T HAVE THAT. IT’S HARD TO FIND COMPANIES IN THE CANNABIS SPACE THAT DO. BUT SPECIFICALLY AT ORGANIGRAM AND MAYBE OTHER COMPANIES THAT DO HAVE THAT DIVERSITY IN THE BOARD ROOM. HOW IMPORTANT IS THAT AS THE COMPANY TRIES TO FUNCTION OVERALL, SPECIFICALLY IN THE CANNABIS SPACE WHERE WE’VE SEEN EXAMPLES OF COMPANIES RUNNING INTO ISSUES WHERE THEY MIGHT NOT HAVE DIFFERENT IDEAS IN THAT BOARD ROOM. >>I THINK THAT’S THE UNIQUE FEATURE THAT ORGANIGRAM DOES HAVE. WE HAVE RACIAL MINORITY, WE HAVE A GENDER MINORITY IN THE ROOM AS WELL. VERY DIVERSE BACKGROUND. AS OPPOSED TO OTHER BOARDS WHERE BASICALLY EVERYONE WENT TO THE SAME PRIVATE SCHOOLS AND WE HAVE A SITUATION WHERE WE HAVE PEOPLE FROM DIFFERENT BACKGROUNDS, DIFFERENT UPBRINGINGS AND THEREFORE YOU BRING DIFFERENT VIEWPOINTS TO THE TABLE AND EVERYONE HAS THE CONFIDENCE TO BRING UP THEIR POINTS, DEBATE IT AND SEE WHERE THINGS GO FROM THERE. AND ALL DECISIONS ARE MADE IN THAT MATTER. NOTHING IS BEING DICTATED FROM THE TOP DOWN. WE’RE VERY INCLUSIVE AND WE TRY TO INCORPORATE THE THOUGHTS IN THE ROOM. >>IT’S A RARE THING TO FIND WHEN YOU LOOK AT THE TOP TEN COMPANIES WHERE BUT IT IS THE CASE WHERE YOU’RE WORKING. DEXTER JOHN, THANK YOU FOR TAKING THE TIME. APPRECIATE YOU. >>>FROM IT TRADE CONCERNS TO CANNABIS TO OF COURSE NOW BOURBON. WE’VE HAD QUITE THE SHOW. TRADE TARIFFS ARE IN QUESTION. WE TALK ABOUT BOURBON. KENTUCKY BOURBON PRODUCTION REACHING ITS HIGHEST LEVEL OF 1.7 MILLION-BARRELS IN 2018. HIGHEST LEVEL SINCE 1972. SINCE THE EU TARIFFS HIT WHISKEY IN JUNE OF 2018 IN RETALIATION OF TRADE TARIFFS, SHIPMENTS TO EUROPE PLUMMETED 21%. WE HAVE OLD FORESTER BOURBON WITH US ON SET. CELEBRATING ITS 150th YEAR NEXT YEAR. JOINING US IS OLD FORESTER’S PRESIDENT CAMPBELL BROWN. HE’S A FIFTH GENERATION BROWN FAMILY MEMBER. THANK YOU FOR BRINGING IN THE SPIRIT AS WELL. IT’S INTERESTING BECAUSE BOURBON, I MEAN IT’S A VERY KEY U.S. EXPORT. BUT IT’S NOT ALL THE CASE THAT ALL THESE COMPANIES ARE SELLING ABROAD. CURIOUS TO GET HOW YOUR BOURBON HAS BEEN SELLING. >>WELL YEAH, IT’S UNIQUELY AMERICAN. FROM START TO FINISH. THE CORN, THE GRAINS, THE BOTTLES ARE MADER A, 100% AMERICAN. OLD FORESTER, WHILE IT’S MOSTLY A U.S. BRAND, BUT OUR PARENT COMPANY BROWN-FORMAN IS ALSO THE MAKER OF JACK DANIELS. YOU CAN IMAGINE WITH THE TARIFF THAT’S HAD A SIGNIFICANT IMPACT ON OUR BUSINESS. ESSENTIALLY WE ARE PRETTY MUCH THE ONLY U.S. PUBLICLY TRADED COMPANY THAT IS AROUND TODAY. MOST OF THESE OTHER COMPANIES WE COMPETE WITH ARE UK BASED OR FRENCH BASED OR EVEN IN JAPAN. SO WE REPRESENT ABOUT 60% OF ALL OF THE WHISKEY THAT’S EXPORTED FROM IT THE UNITED STATES. WE LOOK AT IT AS A TARIFF ON BROWN-FORMAN. >>HOW SIGNIFICANT ARE WE TALKING WHEN WE TALK ABOUT THE IMPACT? >>WE’VE BEEN PRETTY PUBLIC ABOUT IT. THIS IS ABOUT 10 TO $11 MILLION A MONTH THAT IMPACTS OUR BOTTOM LINE. >>ALL RIGHT. THAT’S A NUMBER THERE. >>JUST SHIFTING A LITTLE BIT TO THE BOURBON WHISKEY SPACE. CRAFT WHISKEY IS HAVING ITS MOMENT. WHEN YOU LOOK AT THE COMPETITION IN THE SPACE, ESPECIALLY SINCE BROWN-FORMAN HAS BEEN AROUND FOR SO LONG. HOW ARE YOU DEALING WITH THE COMPETITIVE PRESSURES? >>I THINK WE’VE GOT, IT’S BEEN GREAT FOR EVERYBODY; RIGHT? IT BRINGS INNOVATION, IT BRINGS COMPETITIVENESS, IT CREATES CONVERSATIONS IN BARS AND RESTAURANTS ACROSS THE COUNTRY. SO FRANKLY IT’S BEEN A BENEFIT. IT REALLY DOES BRING A LOT OF INTERESTING WAYS IN WHICH PEOPLE NOW CONSUME IT. >>YEAH. >>THE COCKTAIL CULTURE HAS BEEN ELEVATED AS A RESULT. >>HUGE. >>THE CRAFT BOURBON BOOM. WE’VE BENEFITED FROM THAT AS WELL. >>I DON’T KNOW. I THINK I’M KIND OF THE ANOMALY HERE WHEN WE TALK ABOUT MILLENNIALS. WE WERE TALKING ABOUT WHITE CLAW YESTERDAY AND HOW MILLENNIALS ARE HEALTH CONSCIOUS NOW. SPIRITS IS ONE OF THE AREAS WHERE THERE’S A BIG BOOST HERE WHEN WE TALK ABOUT MILLENNIALS CARING ABOUT IT. I MYSELF AM A HUGE BOURBON GUY, I THINK. BUT I ENJOY IT. TO A HEALTHY LEVEL. AND I’D BE CURIOUS TO GET YOUR TAKE ON A YOUNGER CONSUMER. 150 YEARS IS A LONG TIME FOR A BRAND TO LAST. HOW HAVE YOU NAVIGATED CHANGING TASTES? >>ESSENTIALLY I THINK THIS IS, THE PRODUCT WE’RE DRINKING TODAY IS THE SAME PRODUCT YOU WERE DRINKING 50 YEARS AGO. IT’S WHAT MY FATHER DRANK. I THINK MILLENNIALS AND CONSUMERS IN GENERAL HAVE DEVELOPED A MORE SOPHISTICATED PALATE. THEY WANT TO DRINK SOMETHING THAT’S GOT GREAT FLAVOR. VODKA WAS BOOMING FOREVER. YOU WANT A LITTLE DIVERSITY IN WHAT YOU’RE CONSUMING. THIS IS A GREAT REPRESENTATION OF THAT. YOU HAVE WONDERFUL GRAINS THAT COME TOGETHER. YOU’RE MATURING YOUR WHISKEY IN OAK BARRELS FOR YEARS AND YEARS AND IT JUST, I THINK PEOPLE ENJOY THAT. >>I JUST TOOK A SIP AND IT’S MADE MY DAY. >>I ALSO TOOK A SIP. >>IT’S SOMETHING. LET ME TELL YOU. >>HOW MUCH DO YOU THINK FOR YOUR BRAND ABOUT A CELEBRITY ENDORSEMENTS? IF YOU THINK ABOUT TEQUILA; RIGHT WITH GEORGE CLOONEY ORIGIN WITH RYAN REYNOLDS. HOW MUCH HAVE YOU SEEN A PUSH TOWARDS CELEBRITY TALENT TO COME AFTER THE BOURBON INDUSTRY? >>I THINK IT’S A LOVELY TOOL THAT A LOT OF BRANDS DEPLOY EFFECTIVELY. WE HAVEN’T REALLY DONE THAT. WHAT HAPPENS HAPPENS TENDS TO BE ORGANIC WITH OUR BRANDS. BUT I THINK IF YOU’RE, IT’S VERY COMPETITIVE. YOU WANT TO CREATE SOME AWARENESS. YOU WANT THAT TO BE IMMEDIATE AND THAT WHEN YOU CAN ASSOCIATE YOURSELF WITH A PARTICULAR CELEBRITY OR AN ATHLETE OR A PLACE OR LOCATION THAT’S ICONIC, IT’S A NICE SHORTCUT. WE LIKE TALKING ABOUT OUR WHISKEY. WE’VE GOT REAL PEOPLE THAT HAVE BUILT THIS BRAND OVER 150 YEARS. FOR US THE CELEBRITIES, IT’S OUR BIRTHDAY BOURBON. >>YOU DON’T NEED ANOTHER CELEBRITY ON TOP OF THAT. >>THOSE ARE INTERESTING FUN STORIES TO TALK ABOUT. PEOPLE ARE SO CURIOUS TODAY ABOUT THE PROCESS AND THE PEOPLE AND HOW IT’S MADE AND WHY THEY’VE DONE IT CERTAIN WAYS. SOMETIMES IT’S HARD TO GET THAT KIND OF DEPTH. >>AND THAT IT’S UNIQUELY AMERICAN TOO. WHAT MORE CELEBRITY DO YOU NEED WHEN IT’S 150 YEARS OF BRAND THERE. APPRECIATE YOU BRINGING IN THE BOURBON AS WELL. >>ABSOLUTELY. >>AS WE SHIFT FROM OUR DRINKS TO OUR MEAL NOW HERE ON YFi PM, IT IS LUNCHTIME AFTER ALL. THE CHICKEN SANDWICH CONTROVERSY CONTINUES. THE FAST FOOD WARS HEATING UP AFTER CHICK-FIL-A TOOK TO TWITTER TO BOAST ABOUT HAVING THE BEST CHICKEN SANDWICH ON THE MARKET, CATCHING THE ATTENTION OF ITS COMPETITOR POPEYE’S. WHICH LED TO AN ALL OUT DEBATE ON TWITTER. THE BATTLE DOES NOT STOP THERE. NOW WENDY’S HAS ENTERED THE CHICKEN SANDWICH CONVERSATION. THE FAST FOOD CHAIN TWEETING OUT MONDAY AFTERNOON QUOTE, Y’ALL OUT HERE FIGHTING ABOUT WHICH OF THESE FOOLS HAS THE SECOND BEST CHICKEN SANDWICH. THEY DROPPED THE MICROPHONE WITH THAT. POPEYE’S BIT BACK SAYING SOUNDS LIKE SOMEONE JUST ATE ONE OF OUR BISCUITS. TWEETING BACK LOL, GUESS THAT MEANS THE FOOD’S AS DRY Z AT JOKES. PRETTY BRUTAL. NEVER COME AT WENDY’S ON TWITTER. WE PUT CHICK-FIL-A’S MAC AND CHEESE TO THE TEST. WE FIGURED NOW IT’S TIME FOR A CHICKEN SANDWICH RACE OFF. WE HAVE ALL THREE OF THEM. >>THE MOMENT OF TRUTH. >>THE MOMENT OF TRUTH. THERE’S BEEN A LOT HERE. >>POPEYES. LET’S TRY THE NEW ONE. TO GO FROM A NICE KENTUCKY BOURBON TO CHICKEN SANDWICHES. >>QUICK CAVEAT. OUR PRODUCER HAD TO TRAVEL TO FOUR DIFFERENT POPEYES TO FIND THIS ELUSIVE CHICKEN SANDWICH. >>THEY’RE SOLD OUT. >>THE DEMAND IS SERIOUSLY THERE. >>WE’RE BEING TOLD WE HAVE TO EAT VERY QUICKLY. NO GOOD WAY TO LOOK GOOD MUNCHING ON POPEYES. >>TIMEOUT. >>IS IT THAT GOOD? >>MY MOUTH IS FULL AND THIS IS NOT. >>MY GOD, SHE’S SPEECHLESS. I’VE NEVER SEEN HEIDI CHUNG SPEECHLESS AFTER A BITE LIKE THAT BEFORE. THE CRAZE HAS BEEN NUTS CONSIDERING THE FACT THAT CHICK- FIL-A HAS BUILT ITS BRAND AROUND ONE CHICKEN SANDWICH. >>AND IT’S THE FAVORITE IN AMERICA. >>THAT’S WHAT I THOUGHT. I’LL GIVE IT A GO. >>I’M WAITING FOR THE PLANT- BASED ALTERNATIVE. THE BEYOND CHICKEN. >>WOW. YOU’RE RIGHT. I COULD SEE WHY THAT’S SOLD OUT. STRICTLY BECAUSE OF THE CRUNCH. >>THAT’S WHEY WAS GOING TO SAY. IT’S THE SKIN. I DON’T KNOW IF YOU’RE A BIG CHICKEN SANDWICH CONNOISSEUR. >>IT THIS IS DEFINITELY, I’M BREAKING IT. >>THERE’S ALWAYS THE BUN. >>BEFORE WE RUN OUT OF TIME. BEFORE WE RUN OUT OF TIME. >>HEIDI’S TAKING ONE BITE OF TH WENDY’S. COVERING THE FAST FOOD FOR A LONG TIME. >>NUMBER ONE POPEYES. NUMBER TWO WENDY’S. >>I AGREE. >>TWITTER IS GOING TO COME AFTER ME TODAY. >>I’M ON THE POPEYES TRAIN. ANN BERRY, YOU’RE ON THE BUN TRAIN. WE TRY TO DO THE BEST WE CAN. THANK YOU FOR TAKING THE HOUR. APPRECIATE YOU TAKING THE TIME. >>THIS IS THE BEST JOB. >>IMPRESSIVE. >>HOW TARIFF CONCERNS ARE WEIGHING ON RETAIL AFTER BIG NAMES LIKE KOHL’S AND HOME DEPOT REPORT QUARTERING EARNINGS. THE TICKER STARTS IN TWO. >>> GOOD AFTERNOON. THIS IS THE TICKER. I AM AKIKO FUJITA. THE DOW IS DOWN 72 POINTS. THE SEM PIE 512. THE NASDAQ IS DOWN 24. LET’S START WITH OUR BIG THREE. HOME DEPOT IS ON THE RISE AFTER ITS SECOND QUARTER RESULTS. THAT’S IN SPITE OF MOUNTING CONCERNS ABOUT THE U.S.-CHINA TRADE WERE. >>>AND FRESH CONCERNS ABOUT THE STATE OF THE RETAIL INDUSTRY. U.S. STEEL ANNOUNCES UNEXPECTED LAYOFFS. LET’S BEGIN WITH HOME DEPOT. A STOCK IS GETTING A POP IN THIS SESSION DESPITE A MIXED REPORT CARD IN THE SECOND QUARTER. EARNINGS TOPPED ESTIMATES, BUT THE COMPANY TRIMMED ITS OUTLOOK FOR THE YEAR. HOW MUCH OF THAT LOWER GUIDANCE HAS TO DO WITH THOSE TARIFFS, AND RISING MATERIAL COSTS? >>Reporter: THAT’S THE CRUX OF THE STORY, BUT I THINK THERE’S AN OUTSIDE AMOUNT OF ATTENTION ON THAT RIGHT NOW. IF YOU CONSIDER THE FACT THAT WE HAVE SEEN LUMBER PRICES DECLINE FOR SEVERAL MONTHS IN A ROW, THIS WAS LARGELY FORECAST, WHICH IS WHY HOME DEPOT LOWERED THEIR FORECAST. LOOKING AT THE OVERALL NUMBERS, THEY ARE PRETTY STRONG IN THE QUARTER, AND PROJECTING FOUR PERCENT. THAT’S LOWER THAN WHAT THE STREET EXPECTED BUT WITH ANALYST EXPECTATIONS, THEY WERE ALSO ABLE TO KEEP COSTS UNDER CONTROL, AND THE GROSS MARGIN SHRUNK BY 20 BASIS POINTS. ALSO, PRODUCTIVITY WAS UP, SO ALL IN ALL, A PRETTY GOOD STORY FOR HOME DEPOT. THE STOCK IS UP 4.5 PERCENT, AND IF WE LOOK AT PRICE ACTION, WE CAN SEE IT IS RIGHT UP AGAINST ITS ALL-TIME HIGHS HERE. HOME DEPOT HAS REALLY BEEN ON AN INCREDIBLE RUN IF WE GO BACK FIVE YEARS. WE CAN SEE THIS REALLY STEADY UP TREND IT’S BEEN IN OVER THIS TIME, JUST PEAKING OUT RIGHT HERE. IMPRESSIVE FOR RETAIL STOCK. IN FACT, THAT’S WHY WE SEE THAT SECTOR UP TODAY. HOME DEPOT IS ABOUT 10 PERCENT OF IT. >>WE LOOK AT HOME DEPOT FOR A GAUGE OF WHERE CONSUMER SENTIMENT IS, BUT ALSO A GOOD GAUGE OF WAREHOUSING SECTORS STAND. LET’S LOOK AT THE MORTGAGE RATES COMING DOWN. IT WOULD SEEM THAT WOULD BE PRETTY SUPPORTIVE OF A COMPANY LIKE HOME DEPOT. DID WE GET COMMENTARY ON THAT? >>Reporter: THAT’S A REALLY INTERESTING POINT. THAT CAN WORK IN TWO DIFFERENT WAYS. IF SOMEBODY REFINANCES THEIR HOUSE, THEY ARE PROBABLY GOING TO DO SOME REMODELING. WE ARE SEEING SOME OF THAT GO THROUGH. WITH LOWER MORTGAGE RATES, SOMEONE WILL MAYBE, BUY A NEW HOUSE, BUT IT TAKES SEVERAL MONTHS FOR THAT TO TRANSMIT THROUGH, SO THAT COULD ACCOUNT FOR SOME OF THEIR GUIDANCE, STILL KEEPING IT ROBUST FOR THE SECOND HALF. AND ALSO, THEY ARE EXPECTING SOME ACCELERATION. THAT HAS TO DO WITH COST CONTROLS, BUT BACK TO THE MAIN POINT, IF MORTGAGE RATES ARE HELPING THIS PARTICULAR SECTOR, WE WOULD EXPECT TO SEE THAT WITH LOWE’S, AS WELL. WE ARE SEEING THAT. LOWE’S IS UP 89 PERCENT OVER THE LAST FIVE YEARS, WHEREAS HOME DEPOT IS UP 140 PERCENT, BUT STILL A NICE SHOWING. YOU COMPARE HOME DEPOT TO THE OVERALL RETAIL SECTOR, AND I’M LOOKING AT THE S&P 500. THE RETAIL ETF, XRT, YOU CAN SEE A DIFFERENT STORY HERE. RELATIVELY FLAT TO DOWN OVER THE PAST FIVE YEARS. IF WE DRILL TO THE LAST YEAR, WE CAN SEE RETAIL JUST TAKING A BATH OVERALL. 25 PERCENT DOWN. HOME DEPOT DEFINITELY OUTPERFORM THE OVERALL RETAIL MARKET HERE. IT SPEAKS WELL FOR THE CONSUMER, AND THE ECONOMY, ESPECIALLY NOTWITHSTANDING ALL THE TRADE TALK WE’VE BEEN HAVING RECENTLY. >>>WE ARE ALSO WATCHING COLES TODAY IN PARTNERSHIP WITH AMAZON. THE COMPANY BEAT EARNINGS EXPECTATIONS IN THE SECOND QUARTER, BUT WE ARE SEEING STOCK UNDER PRESSURE AFTER IT WARNED OF UNCERTAINTY STEMMING FROM THE TRADE WAR. THAT IS CLOUDING THE OUTLOOK FOR THE CRUCIAL HOLIDAY SEASON. SCOTT GAMM IS JOINING ME FROM THE FLOOR OF THE NEW YORK STOCK EXCHANGE. THE STOCK WAS UP SIX PERCENT PRE-MARKET, AND NOW WE ARE SEEING IT UNDER USHER WITH JUST TWO HOURS TO GO. >>Reporter: THAT’S RIGHT. IT’S ALSO THE WORST PERFORMING STOCK IN THE S&P 500 RIGHT NOW, ALTHOUGH THE STOCK WAS UP OVER THE PAST COUPLE OF TRADING SESSIONS, SO WE ARE JUST GIVING UP THE GAIN WE SAW OVER THE PAST FEW DAYS. YEAR TO DATE, THE STOCK IS DOWN A MORE SIGNIFICANT 31 PERCENT. AS WE MENTIONED, EARNINGS DID BEAT EXPECTATIONS, BUT REVENUE MISSED ESTIMATES, AND FELL ABOUT THREE PERCENT YEAR-OVER- YEAR. SAME-STORE SALES ALSO FELL ABOUT 2.9 PERCENTWHILE WALL STREET WAS EXPECTING ONLY A 2.5 PERCENT DECLINE. THE COMPANY ALSO HAS THIS PARTNERSHIP, AS YOU MENTIONED, WITH AMAZON, WHERE USERS CAN RETURN AMAZON ITEMS IN KOHL’S STORES. OF COURSE, KOHL’S HAS 1100 STORES ACROSS THE COUNTRY. CEO MICHELLE GASS IN A STATEMENT SAID SHE IS CONFIDENT THE PARTNERSHIP WITH AMAZON WILL CONTINUE TO CONTRIBUTE TO THE COMPANY’S RESULTS FOR THE REST OF THE YEAR. >>THE PARENT COMPANY OF T.J. MAXX AND HOME GOODS ALSO REPORTED EARNINGS. WHAT STOOD OUT TO YOU WITH THOSE NUMBERS? >>Reporter: SAME-STORE SALES ROSE 2 PERCENT YEAR-OVER-YEAR, BUT WALL STREET WAS EXPECTING A THREE PERCENT RISE YEAR-OVER- YEAR. GUIDANCE FOR TJX ALSO CAME IN BELOW EXPECTATIONS. THE STOCK WAS DOWN SLIGHTLY, RIGHT NOW, ALTHOUGH STILL AT THE HIGHS OF THE SESSION. IT WAS DOWN MORE THIS MORNING. TJX HAS BEEN A STANDOUT IN RETAIL WITH THE STOCK UP ABOUT 15 PERCENT, SO FAR THIS YEAR. IF YOU LOOK AT THE BROADER RETAIL SECTOR, THAT’S DOWN ABOUT FIVE PERCENT, SO FAR THIS YEAR. TJX HAS BEEN ABLE TO HOLD ITS OWN AMID COMPETITION FROM SOME OF THE ONLINE RETAILERS JUST BECAUSE THE EXPERIENCE AT TJX TENDS TO BE A LITTLE DIFFERENT THAN YOUR TRADITIONAL BRICK AND MORTAR RETAIL STORE. AT TJX, YOU ARE ON A SCAVENGER HUNT TO FIND A GOOD DEAL. WHEN YOU LOOK AT THE BROADER CONSUMER DATA, WHETHER IT’S RETAIL SALES DATA OR EMPLOYMENT DATA, WE ARE CERTAINLY SEEING CONSUMER STRENGTH, BUT THAT OESN’T MEAN ALL OF THE RETAIL SECTOR IS DOING WELL. CONSUMERS ARE BEING SELECTIVE ABOUT WHERE THEY SHOP. >>THANKS FOR THAT. OUR THIRD TICKER OF THE DAY IS U.S. STEEL. THE COMPANY HAS ANNOUNCED ITS LAYING OFF 200 EMPLOYEES FOLLOWING U.S. DECISIONS TO HALT PRODUCTION AT THE FACILITY. EXECUTIVES ARE ATTRIBUTING THE PULLBACK TO LOWER STEEL PRICES, AND SOFTER DEMAND. INES FERRE IS HERE WITH ME. WE HEARD FROM THE CEO PRAISING THE PRESIDENT’S MOVES TO ADD 25 PERCENT TARIFFS ON STEEL IMPORTS. THEY ACTUALLY CREATED JOBS ON THE BACK OF IT. >>Reporter: THAT’S RIGHT. THEY CREATED JOBS IN ILLINOIS. THEY SIGNALED THEY WOULD CREATE 800 JOBS, INCLUDING NOT ONLY AT THE STEEL PLANT, BUT ALSO SERVICES, RESTAURANTS, THE LIKE THAT WOULD SUPPORT EMPLOYEES IN THE AREA, BUT THIS ANNOUNCEMENT WOULD AFFECT ABOUT 200 WORKERS WHO WOULD BE TEMPORARILY LAID OFF. THIS MEANS THIS COULD BE A SIX- MONTH PERIOD. THE COMPANY DOESN’T REALLY KNOW FOR HOW LONG THIS LAYOFF WILL TAKE PLACE. THEY ARE SAYING IT IS BASED ON MARKET CONDITIONS. THIS IS BECAUSE TWO OF THEIR PLANTS ARE IDLE. ONE IS IN AN AREA OF MICHIGAN, IN THE GREAT LAKES. AND THEN ALSO IN ANOTHER AREA OF MICHIGAN, SO IT’S TWO PLANTS BEING AFFECTED BY THESE TEMPORARY LAYOFFS. THIS IS BECAUSE, AS YOU MENTIONED, LOWER STEEL PRICES, AND SOFTENING DEMAND. WHAT WE HAVE SEEN IS IF YOU TAKE A LOOK AT WHAT DEERE AND COMPANY REPORTED IN THEIR LAST EARNINGS, THEY SAID FARMERS ARE DELAYING BUYING BIG MACHINERY BECAUSE OF THE TRADE UNCERTAINTIES, BECAUSE OF FLOODING IN SOME AREAS, WITH CROPS, ETC. DEMAND IS DEFINITELY HAVING AN AFFECT. >>YOU TALK ABOUT THESE DEMANDS BEING TEMPORARY. THEY ARE JUST HALTING PRODUCTION RIGHT NOW. úWHAT KIN LOOKING AT? >>Reporter: IT COULD BE A TIMELINE OF SIX MONTHS. THEY ARE NOT EXACTLY SURE WHEN THINGS WILL BE NORMAL AGAIN. AS FAR AS THEIR ILLINOIS PLANT, THE ONE WE WERE TALKING ABOUT EARLIER, THE ONE LAST YEAR, JOBS WERE CREATED, THE STEEL UNION BELIEVES THERE MAY BE SOME LAYOFFS THERE. A SPOKESWOMAN FOR THE COMPANY SAYS THEY DON’T EXPECT EMPLOYMENT CHANGES THERE. FOR THAT PLANT, THEY HAD TAX BREAKS THAT WERE CONTINGENT ON MAINTAINING A CERTAIN LEVEL OF JOBS IN THE AREA. >>>LET’S TAKE A LOOK AT HOW THE MARKETS ARE TRENDING WITH ABOUT TWO HOURS TO GO IN THE TRADING DAY. IT HAS BEEN A CHOPPY SESSION, SO FAR. WE ARE SEEING THE DOW NOW DOWN 103 POINTS. THE S&P 500, DOWN 16. THE NASDAQ DOWN 37. TAKING A LOOK AT THE BOND YIELDS, THE 10 YEAR TREASURY SLIPPING AT 1.554 RIGHT NOW. AND THE TWO-YEAR IS AT 1.508. THE WHITE HOUSE IS CONSIDERING ADDITIONAL STIMULUS. SENIOR WHITE HOUSE OFFICIALS ARE DISCUSSING A TEMPORARY PAYROLL TAX CUT TO BOOST THE ECONOMY. PRESS SECRETARY HOGAN GIDLEY DISMISSING THE QUOTES SAYING MORE TAX CUTS FOR THE AMERICAN PEOPLE ARE CERTAINLY ON THE TABLE, BUT CUTTING PAYROLL TAXES IS NOT UNDER CONSIDERATION AT THIS TIME. CHRIS AND MERRIMACK DIRECTOR OF RESEARCH AT JERRY MONTGOMERY IS HERE. THESE REPORTS COMING OUT OF THE WHITE HOUSE SEEM TO RUN COUNTER TO THE ADMINISTRATION, WHICH IS THAT THE ECONOMY IS DOING JUST GREAT. SHOULD INVESTORS BE A LITTLE NERVOUS? >>THE MARKET IS ALWAYS LOOKING OUT THREE TO SIX MONTHS. THERE IS A LOT OF UNCERTAINTY ABOUT THE ELECTION. WE HAVE SLOWER LOAN GROWTH, AND WE HAVE TO ANTICIPATE THAT, PERHAPS, GDP GOES FROM THE CURRENT HIGH CLOSER TO ONE. WE DON’T KNOW THAT FOR SURE, BUT IT’S POSSIBLE. I THINK THE UNCERTAINTY THAT EXISTS IS THAT THE GOOD NEWS CHANGES. WE DON’T SEE SIGNS OF THAT, BUT THERE IS ALWAYS THE MARKET WORRY. >>WE HAVE THE JACKSON HOLE SYMPOSIUM COMING UP THIS WEEK. WHEN YOU LOOK AT JAY POWELL’S LAST PRESS CONFERENCE, HE TALKED ABOUT CONCERNS AROUND TARIFFS, SAYING THIS IS DIFFICULT TO DIAGNOSE, IF I CAN SUMMARIZE HIS WORDS. SINCE THEN, WE’VE GOTTEN SOME RELIEF ON THE TARIFF ISSUES, SOME KEY CONSUMER GOODS TAKEN OFF THE LIST, AND RELIEF FOR HUAWEI WITH THAT EXTENSION FOR THE 90-DAY WINDOW. DO YOU THINK THE OUTLOOK HAS CHANGED? >>ONLY SLIGHTLY. I THINK THE SAID MINUTES IS A KEY INDICATOR TO SEE, TO WHAT EXTENT THEY ARE SIGNALING FURTHER EASING’S. IT’S POSSIBLE THE FED TAKES THIS ONE MEETING AT A TIME BECAUSE MARKETS ARE ANTICIPATING MULTIPLE RATE CUTS. THERE IS NO GUARANTEE THOSE WILL HAPPEN. THIS COULD BE A SET OF PATTERNS THAT HAS TO UNFOLD. THE FACT THAT WE DELAYED TO DECEMBER IS A HEALTHY THING. IT’S STILL POSITIVE FOR THE ECONOMY. PUSHING TWO PERCENT IS STILL POSITIVE. RISK IS IF IT CHANGES, BUT THE FED HAS TO TAKE THAT RISK. THERE IS NO NEED FOR RASH CHANGES. THEY MAY HAVE AN EASIER CYCLE, BUT I THINK THIS WEEK WILL GIVE US FURTHER CLUES ON WHERE THEY ARE AT. >>HOW EFFECTIVE HAS THAT 20- POINT BASES CUT BEEN? >>I THINK IT SETS THE TONE THAT THE FED DIDN’T NEED TO RAISE RATES LAST DECEMBER. IT TOOK THAT AWAY. I THINK IS MAKING A BIG CHANGE TO CD RATES ON THE JD CAPITAL MARKETS DESK, WHERE RATES ARE DOWN 60 TO 80 BASIS POINTS IN THE LAST COUPLE OF MONTHS. WE THINK BANKS HAVE MORE COVER FOR LOWER DEPOSIT RATES SOONER. THAT WILL RELIEVE MARGINS MORE THAN INVESTORS. I THINK THE MARGIN IS OVERDONE, BUT OVER TIME THEY ARE UNDER PRESSURE. THAT’S FOR CERTAIN. I THINK THE DOWNSIDE MARGIN IS LESS THAN THE MARKET FEARS. >>JAY POWELL CHARACTERIZED THE LAST CUT AS A MIDCYCLE ADJUSTMENT. DOES HE HAVE TO, MAYBE, ELABORATE ON THAT MORE? I WONDER IF, GIVEN WHAT WE SAW LAST WEEK, THE SLIGHT CONVERSION OF THE YIELD CURVE, ALTHOUGH THE ADMINISTRATION WOULD ARGUE IT HASN’T YIELDED YET BECAUSE OF THE SPREAD. HAS THE CASE FOR THE ADDITIONAL CUT CHANGED FOR THE FED? IN OTHER WORDS, THE WAY THEY CHARACTERIZE THE TRAJECTORY MOVING FORWARD? >>Reporter: I THINK IT HAS A LITTLE BIT. THE FED HAS TO GIVE ITSELF FLEXIBILITY. WE WILL SEE HOW DO THEY COUCH AND CREATE MORE FLEXIBILITY. I DON’T THINK THEY WANT TO BOX THEMSELVES INTO A CUT. EVEN THOUGH THE FUTURE MARKETS ARE SORT OF GUARANTEEING THERE IS A CHANGE RIGHT AWAY, THE FED MAY POSITION OTHERWISE TO TRY TO EXTEND THIS DECISION CYCLE. >>WE SAW BOND YIELDS LAST WEEK, BUT THERE IS NO QUESTION IT’S MOVING DOWNWARD. IF YOU LOOK GLOBALLY, THE ARGUMENT IS THAT IN THE U.S., YOU ARE STILL GETTING MORE YIELD THAN YOU WOULD IN A PLACE LIKE EUROPE OR JAPAN. DOES THAT SUGGEST THIS IS ONLY GOING TO PUSH LOWER? IF THAT’S THE CASE, WHAT DOES THAT SAY ABOUT THE BROADER OUTLOOK? >>THE U.S. IS STILL THE PLACE TO BE. I DON’T THINK IT WILL CHANGE. THE CASH HAS TO FIND A HOME. IT HAS MADE THAT MOVE. THE QUESTION IS, DOES IT GET WORSE? AS LONG AS OUR ECONOMY STAYS POSITIVE, WE HAVE THE FLEXIBILITY FOR RATE CHANGES. TYPICALLY, THE FED DOES RIGHT SIDE THE YIELD CURVE. I THINK IT’S A HEADWIND FOR BANKS AND CAPITAL MARKETS THAT WILL EVENTUALLY GO AWAY, BUT IT MAY BE WITH US FOR LONGER THAN NORMAL. I THINK, TO SOME EXTENT, THE FED HAS TO BY THEMSELVES FLEXIBILITY IF THE ECONOMY SLOWS, BUT WE HAVEN’T SEEN THE SLOWDOWN YET. IT IS STILL POSITIVE, STILL STRONG. WE HAVEN’T HIT A RECESSION UNTIL WE HAVE GONE NEGATIVE. >>HOW SHOULD INVESTORS BE POSITIONING THEMSELVES GIVEN THOSE FACTORS? >>YIELD IS GREAT TO LOOK AT BECAUSE INTEREST RATES ARE SO LOW. 95 PERCENT OF THE BANK STOCKS ARE TRADING AT A YIELD HIGHER THAN THE 10 YEAR TREASURY. THAT STATISTIC IS ABOUT 85 PERCENT FROM MID-CAP STOCKS. YOU CAN FIND YIELD EVERYWHERE. CAPITAL AND DIVIDENDS ARE VERY STRONG. MANY BANKS ARE BUYING BACK STOCKS. WE THINK THE BUYBACKS WILL CONTINUE THE SECOND HALF OF THE YEAR. >>IS U.S. EQUITY STILL THE PLACE TO BE? A LOT OF GUESTS SAY TO LOOK AT EMERGING MARKETS. HOW ARE YOU APPROACHING IT? >>WE THINK IN THE BANKS, AND THE U.S. EQUITIES, THAT THE RISK FOR REWARD IS IN OUR FAVOR. BECAUSE WE’VE HAD THIS CORRECTIONS, AND BANKS ARE NOW 60 PERCENT OF THE S&P, THAT’S AS CHEAP AS I’VE SEEN IN THE LAST SIX YEARS. >>OKAY. WE WILL HAVE TO LEAVE IT THERE. THAK YOU FOR JOINING US. >>>COMING UP, WHY THE FDA IS CAUSING SHARES OF SERUPTA THERAPEUTICS TO CRASH. >>>AND WE WILL EXPLAIN MORE ABOUT THE YIELD CURVE, COMING UP. >>>PHARMACEUTICAL COMPANY SAREPTA THERAPEUTICS PLUNGED TODAY AFTER THE FDA REJECTED ITS SECOND DRUG FOR MUSCULAR DYSTROPH. THE FDA’S DECISION COULD MEAN,” POLITICAL FALLOUT.” WALK US THROUGH THIS. WHY DID THE FDA TURN DOWN THE DRUG? >>THERE HAVE BEEN A COUPLE OF THEORIES ON WHY. THE MAIN ONE BEING SAREPTA THERAPEUTICS HAS ALREADY BEEN IN A TUSSLE WITH THE FDA. IT’S PREVIOUS DRUG, THE FIRST ONE THAT GOT PASSED AND FAST- TRACK TRACT HAS HAD POTENTIAL ISSUES, AND IT WAS APPROVED EVEN THOUGH THERE WAS DEBATE OVER WHETHER OR NOT IT WAS EFFECTIVE. THAT SEEMS TO HAVE SPLIT THE AGENCY’S LEANINGS. IT COULD BE BACKLASH OR LOOK AT FAST TRACKING. DUCHENNE MUSCULAR DYSTROPHY IS A VERY SMALL SUBSET OF THE POPULATION, AND SO THE FIRST DRUG WAS LOOKING TO HELP ABOUT 13 PERCENT OF THE POPULATION. THE SECOND DRUG WAS GOING TO HELP EIGHT PERCENT OF THE POPULATION, SO IT’S A GOOD MARKET THEY WERE AIMING FOR. THIS SORT OF SHIFTS THE WEIGHT OF THE COMPANY ONTOGENETIC THERAPY, WHICH IS A COMPLETELY DIFFERENT CATEGORY. >>YOU TALK ABOUT THIS BEING HIGHLY SPECIALIZED. IT’S A VERY SMALL PORTION OF THE MARKET. HOW DOES WHAT IS HAPPENING WITH SAREPTA THERAPEUTICS COMPARE WITH WHAT’S HAPPENING WITH SOME OF THE OTHER COMPANIES IN THIS MARKET? >>ALL OF THESE SMALLER COMPANIES ARE FACING REALLY INTERESTING FEATURES. IT’S A VERY VOLATILE MARKET. THAT’S BEEN TRUE FOR SAREPTA THERAPEUTICS. IT HAS BEEN UP AND DOWN CONSISTENTLY. PEOPLE HAVE BEEN TALKING ABOUT IT BEING VOLATILE FOR A WHILE. THE WARFARIN DRUG INDUSTRY IS VALUED BETWEEN $224 MILLION AND $318 BILLION. IT’S A HUGE MARKET THAT THESE PLAYERS ARE IN, AND THEY HAVE TO FIGHT IN THE SAME SPACE AS OTHER ESTABLISHED PHARMACEUTICAL COMPANIES. GSK, BAYER, AMGEN, ALL THESE MAJOR DRUG COMPANIES. THEY ARE PLAYING IN THE SAME FIELD, SO IT’S A REALLY TOUGH AREA FOR THEM TO GET INTO, AND CONVINCE SHAREHOLDERS TO STAY ON BOARD. >>IF YOU CAN, THE PAYOFF IS BIG. >>ABSOLUTELY HUGE. >>THE YIELD ON THE 10-YEAR AND TWO-YEAR TREASURY YIELDS INVERTED FOR THE FIRST TIME LAST YEAR, RATTLING INVESTORS WHO CONSIDER IT TO BE A RECESSION SIGNAL. IS THERE STILL CAUSE FOR CONCERN? JOINING US FROM THE CBOE TRADING FLOOR IS TIM BINGHAM, LEAD OPTION STRATEGIST AT DELTA DERIVATIVES. THERE SEEMS TO BE A DEBATE WITHIN THE ADMINISTRATION ABOUT WHETHER THIS YIELD CURVE CAN BE CALLED AN AMERICAN VERSION. WE HEARD PETER NAVARRO OVER THE WEEKEND, TALKING ABOUT HOW THE SPREAD WASN’T BIG ENOUGH TO CALL IT A RECESSION SIGNAL. HOW DO YOU READ THE LINES? >>Reporter: IF YOU LOOK ON A SPREAD BASIS OR PERCENTAGE BASIS, IT MAKES ALL THE DIFFERENCE IN THE WORLD. WE ARE IN SUCH LOW RATES, I THINK THAT IS ONE THING TO CONSIDER. WE HAVE THE 10-YEAR NEAR HISTORIC LOWS. THE 30-YEAR AT HISTORIC LOWS. INTEREST RATES GENERALLY LOW ACROSS THE BOARD. A LOT OF THAT INVERSION COMES FROM THE FACT THAT RATES AROUND THE WORLD ARE MAINLY NEGATIVE, SO THAT 1.5 PERCENT OR SO 10- YEAR YIELD IS LOOKING ATTRACTIVE. A LOT OF THE STUFF THAT WOULD NORMALLY APPLY TO THE YIELD CURVE INVERSION IS GETTING A LITTLE MORPHED HERE SIMPLY BY THE FACT THAT MONEY IS SO CHEAP AROUND THE WORLD, AND THE FACT THAT TDP, LAST I LOOKED, 2.2. GDP ACTUALLY ABOVE THAT 10-YEAR RATE MAKES THE NORMAL YIELD INVERSION REVERSIBLE. A LOT OF DIFFERENCES HERE. UNTIL GROWTH SLOWS, I AM A BELIEVER THAT THIS IS MORE OF AN ANOMALY THAN AN ACTUAL NORMAL KIND OF RECESSION INDICATOR. >>CONSIDERING THOSE EASY MONETARY POLICY’S OUTSIDE OF THE U.S., THAT BEING A DISTORTION OF WHAT’S HAPPENING WITH YIELDS HERE IN THE U.S., HOW DO YOU THINK INVESTORS SHOULD BE READING THEM MOVES IN THE BOND MARKET? >>IF YOU LOOK AT THE TLT, WHICH IS BASICALLY A 20-YEAR BOND, IT’S HAD A HISTORIC RUN. EVERYONE, JUST RUNNING FOR YIELD ANYWHERE ON THE CURVE, WHICH KIND OF LENDS SUPPORT TO SOME OF THE YIELD STOCKS IN THE S&P 500. SOME OF THOSE BANK STOCKS, WHICH NORMALLY MIGHT BE HURT A LITTLE BIT MORE BY THAT YIELD INVERSION, PROBABLY GETTING A BIT MORE BECAUSE OF THEIR HIGH DIVIDEND YIELD. I LIKE PLAYING THE LITTLE BIT OF GROWTH, A LITTLE BIT OF YIELD. CERTAINLY, THE WARREN BUFFET, COCA-COLA STOCKS. I THINK IT WILL STANCH ANY KIND OF BIG SELLOFF HERE IN THE U.S. GIVEN THE FACT THAT WE ARE STILL GROWING COMPARED TO THE REST OF THE WORLD, AND WE STILL HAVE A NICE DIVIDEND YIELD ON STOCKS. >>WHAT ARE SOME SECTORS INVESTORS SHOULD STAY AWAY FROM?>>Reporter: I THINK ANY OF THE ONES THAT HAVE GOTTEN OUT OVER THEIR SKIS, AND THE ONES THAT DON’T PAY MUCH YIELD. GROWTH IS ABSOLUTELY GROWING BUT SLOWING, SO THE HIGH DATA NAMES I WOULD BE LEERY OF. I WOULD ALSO PROBABLY STEER AWAY FROM SOME OF THE ONES THAT HAVE PROBABLY GOTTEN THE UTILITIES OF THE WORLD, WHICH DON’T HAVE A LOT OF GROWTH. JUST KIND OF A BARBELL STRATEGY ON THE REALLY LOW BETA, HIGH BETA, AND STAY AWAY FROM THOSE. ‘S MIDDLE-OF-THE-ROAD KIND OF STOCKS. >>IT CERTAINLY SEEMS LIKE THINGS HAVE TURNED JITTERY NOT JUST HERE IN THE U.S., BUT ON DATA OUTSIDE OF THE U.S. WE TALKED ABOUT CHINA AND THE SLOWDOWN IN EUROPE, AS WELL. LOOKING AHEAD TO LATER THIS WEEK WHEN WE ARE GOING TO HEAR FROM JAY POWELL IN JACKSON HOLE, WHAT ARE YOU LOOKING TO HEAR FROM HIM IN TERMS OF HOW THE FED IS VIEWING THE GLOBAL OUTLOOK? AND HOW IN FACT THEY ARE CHARACTERIZING THIS — THESE ADDITIONAL RATE CUTS THAT ARE EXPECTED TO COME. ARE WE STILL IN THE MIDCYCLE ADJUSTMENT? >>Reporter: I THINK IT WILL HAVE TO BE A TIGHT ROPE, WHERE YOU CAN’T HIT TOO BIG OF A SLOWDOWN, BUT YOU HAVE TO GIVE AT LEAST A COUPLE OF RATE CUTS A BIG LIKELIHOOD. THE MARKETS ARE PRICING IT ALREADY, SO I THINK IT WILL BE A DANCE HERE. CERTAINLY, SOME DOVISH TALK, BUT IF IT LEANS TOO MUCH, I THINK THAT MIGHT THE MARKETS, AS WELL. GROWTH STILL REMAINS STRONG, ALTHOUGH SOMEWHAT SLOWING. WE ARE, MAYBE, LOOKING AT SOME INTEREST RATE CUTS. I THINK THAT WOULD SOOTHE THE MARKETS. WE ARE SEEING THE REST OF THE WORLD CUT AS MUCH AS THEY CAN, ALTHOUGH THEY ARE RUNNING OUT OF BULLETS, CERTAINLY. >>WHEN WE LOOK AT MARKET REACTION FROM THE FED, THAT SEEMED TO BE WIPED OUT RIGHT AWAY, WITH THE TERRORIST THREAT THAT FOLLOWED. HOW BIG OF A CATALYST DO YOU EXPECT AN ADDITIONAL RATE CUT IN SEPTEMBER 2 BEFORE THE MARKETS? OR HAS THE 25 BASIS POINTS ALREADY BEEN PRICED IN? >>Reporter: I THINK 25 IN DECEMBER, AND THEN PROBABLY ANOTHER 25, BY AT LEAST THE END OF THE YEAR. 50 BASIS POINTS, I THINK IS PRICED IN. IF, AFTER SEPTEMBER, THEY CAN’T THEY MAY NOT BE LOOKING AT ANOTHER ONE, THAT MAY THE MARKETS, BUT I CERTAINLY DO NOT THINK WE WILL GET THE FULL 100- BASIS POINT CUT THE ADMINISTRATION ONCE, BUT I THINK 50 BASIS POINTS WILL BE THE SWEET SPOT. 25 IN SEPTEMBER, 25 BY DECEMBER, AND THEN SEE WHERE THINGS GO, BUT U.S. GROWTH IS STILL OKAY COMPARED TO THE REST OF THE WORLD. >>APPRECIATE YOU TAKING THE TIME TODAY. >>YOU BET. ANY TIME. >>>COMING UP, SURPRISING REVELATIONS ABOUT CHINA’S INVOLVEMENT IN A DISINFORMATION CAMPAIGN AGAINST HONG KONG PROTESTERS. A TOP CYBER EXPERT WEIGHS IN TO DISCUSS WHAT MORE TWITTER AND FACEBOOK NEED TO DO TO STOP IT. >>>A BULLISH CALL PUSHES SHARES OF BEYOND MEAT EVEN HIGHER. BY J.P. MORGAN SEES MORE GREEN ARROWS AHEAD FOR THE STOCK. >>>WELCOME BACK TO THE TICKER. LET’S GIVE YOU A QUICK RECAP OF THE TICKERS WE’VE COVERED IN THE SHOW TONIGHT. HOME DEPOT STOCK IS RALLYING AFTER BETTER THAN EXPECTED SECOND-QUARTER PROFITS, BUT IT WASN’T ALL POSITIVE NEWS AFTER HOME DEPOT MISSED SALES ESTIMATES AND CUT ITS FULL-YEAR REVENUE OUTLOOK CITING THE TRADE WERE’S IMPACT ON CONSUMER SPENDING. THE SECOND TICKER WAS KOHL’S. IT’S IN THE RED DESPITE AN EARNINGS BEAT IN THE SECOND QUARTER. THE RETAILER CAME IN SHORT OF EXPECTATIONS WITH A STEEPER THAN ANTICIPATED FALL FORECAST IN ITS FULL-YEAR PROFIT MARGINS. OUR THIRD TICKER IS U.S. STEEL AFTER IT HAS LAID OFF DOZENS OF WORKERS IN GREAT LAKES, MICHIGAN, WITH TEMPORARY PLANS TO REMOVE UP TO 200 MORE EMPLOYEES, BLAMING ONGOING CHALLENGING MARKET CONDITIONS FOR THE MOVE. >>>LET’S CHECK THE CLOSING PRICE OF OIL. WE ARE LOOKING AT $56.32 A BARREL. THAT’S ABOUT 2/10 OF A PERCENT HIGHER. THIS, COMING AS PRICES FELL ON CONCERNS OVER FUTURE DEMAND, BUT LOSSES WERE CAPPED BY OPTIMISM THAT U.S.-CHINA TRADE TENSIONS WILL EASE. >>>TWITTER AND FACEBOOK HAVE SUSPENDED ACCOUNTS THEY BELIEVE TO BE PART OF A CHINESE EFFORT TO UNDERMINE PROTESTS IN HONG KONG. TWITTER, SAYING IT TOOK DOWN NEARLY 1000 ACCOUNTS ORIGINATING IN CHINA WHILE FACEBOOK TOOK DOWN FIVE ACCOUNTS REACHING MORE THAN 15,000 OTHER ACCOUNTS. YAHOO FINANCE HAS BEEN COMING THROUGH THOSE TWEETS. THEY POINT TOWARD A SIMILAR NARRATIVE PUSHED BY THE CHINESE. NUMBER ONE, THE CONTROVERSIAL EXTRADITION BILL IS NEEDED IN HONG KONG. IT ALSO CATEGORIZED PROTESTERS AS RIOTERS, MANIPULATED BY THE CIA. JOINING US IS DAVID KENNEDY, THE CEO OF TRUSTED SAC. ONE OF OUR REPORTERS BASICALLY DOWNLOADED A GIGABYTE OF TWEETS FROM THOSE ACCOUNTS. SHOULD WE BE SURPRISED THIS KIND OF CAMPAIGN HAS BEEN GOING ON, ON BEHALF OF THE CHINESE GOVERNMENT? >>Reporter: SURPRISED? NO. BUT THIS IS THE FIRST TIME WE HAVE SEEN CHINA MAKE AN OVERT, AGGRESSIVE SOCIAL MEDIA PRESENCE TO TRY TO CHANGE POPULATION PERCEPTION, AND THINGS LIKE THAT. FOR US IN THE SECURITY INDUSTRY, THIS IS THE FIRST TIME WE HAVE SEEN CHINA GO THIS OVERT. WE HAVE KNOWN THEY’VE HAD THIS CAPABILITY FOR A LONG TIME. THEY JUST NEVER USED IT. THAT’S BEEN INTERESTING, TO SEE HOW THAT DEVELOPS. >>SOME OF THESE ACCOUNTS WERE CREATED ALL THE WAY BACK IN 2017, BUT IT TOOK TWO YEARS FOR TWITTER TO ACTUALLY GET TO THEM, AND REALLY SINGLE THEM OUT AS THOSE BACKED BY THE CHINESE GOVERNMENT. WHAT DOES THAT SUGGEST IN TERMS OF HOW PREPARED THE PLATFORM IS, OR THE CHALLENGES OF THE PLATFORM, TRYING TO STAY AHEAD OF SOME OF THESE ACCOUNTS? >>Reporter: YOU HIT IT SPOT ON IN THE SECOND PART AROUND HOW HARD IT IS FOR SOCIAL MEDIA ORGANIZATIONS, LIKE FACEBOOK, TWITTER, INSTAGRAM, TO GO AFTER THESE INDIVIDUALS BECAUSE THEY BUILD PROFILES AND PERSONAS OVER TIME, AND USE THEM WHEN THEY NEED TO. IT’S DIFFICULT TO DIFFERENTIATE WHAT IS OR ISN’T LEGITIMATE UNTIL THEY GO MORE AGGRESSIVE WITH AGGRESSIVE CAMPAIGNS. SAME THING FOR THE RUSSIAN ELECTION CYCLE. WHEN RUSSIANS WERE INTERFERING WITH THE ELECTIONS, THEY CREATED THESE ACCOUNTS TWO OR THREE YEARS IN ADVANCE TO GAIN POPULARITY, TO REACH AS MANY PEOPLE AS POSSIBLE, AND THEN START GOING OVERLY AGGRESSIVE WITH THEIR MESSAGE. >>THE EFFORTS OF THE RUSSIANS DURING THE 2016 ELECTION YOU JUST POINTED TO ARE CERTAINLY WELL-DOCUMENTED. I WONDER IF THERE IS ANYTHING THAT YOU SEE IN TERMS OF WHAT THE CHINESE ARE DOING THAT DIFFERENTIATES IT FROM SOME OF THE OTHER GOVERNMENT RUN DISINFORMATION CAMPAIGNS? >>IN THIS ONE, SPECIFICALLY, WHAT’S INTERESTING ABOUT THESE ACCOUNTS IS THEY WERE MADE WELL IN ADVANCE, KNOWING SOMETHING LIKE THIS MAY HAPPEN, SO THEY PROBABLY PLANNED WELL AHEAD OF TIME BEFORE THIS BILL WAS RELEASED, TO GO AFTER THESE DIFFERENT PERSONAS AND DIFFERENT PERCEPTIONS OF WHAT’S HAPPENING. AGAIN, PRAISING THE POLICE, CALLING PROTESTERS RIOTERS. THEY KNEW THIS WAS GOING TO OCCUR, SO THEY PLAN STRATEGICALLY. WITH RUSSIAN INFLUENCE PIECES IN 2016, IT WAS VERY AD HOC. THEY DIDN’T PLAN SEVERAL YEARS IN ADVANCE. IT WAS A KNEE-JERK CAMPAIGN DURING THE ELECTION PROCESS TO GET AS MUCH HYPE AS POSSIBLE. THIS IS VERY METHODICAL. THIS GOES INTO HOW CHINA OPERATES BOTH ON THE CYBER OPERATIONS SIDE, WITH THE THEFT OF INTELLECTUAL PROPERTY, AND THEY THINK VERY LONG-TERM WHEREAS RUSSIA, EVEN THE U.S., WAS NEARSIGHTED IN SOME CASES. >>I THOUGHT IT WAS INTERESTING SOME OF THESE ACCOUNTS PUT OUT TWEETS IN SUPPORT OF HUAWEI. SO, NOT JUST HONG KONG, BUT TALKING ABOUT HUAWEI, AND ALLEGATIONS ABOUT TRADE TALKS BETWEEN THE U.S. AND THE CHINESE. WHAT DOES THAT SUGGEST IN TERMS OF WHAT MORE PLATFORMS LIKE FACEBOOK AND TWITTER NEED TO DO, ESPECIALLY WITH THE 2020 ELECTION CYCLE LOOMING. >>IT’S GOING TO BE A VERY INTERESTING 2020 FOR US. I KNOW THE U.S. IS TRYING TO PROTECT ITS INFRASTRUCTURE, BUT WHEN IT COMES TO SOCIAL MEDIA, WE SAW MARK ZUCKERBERG AND OTHER INDIVIDUALS FROM DIFFERENT PLATFORMS TESTIFY IN FRONT OF CONGRESS THAT THEY ARE ATTEMPTING TO DO MORE WORK TO PROTECT AGAINST THESE, BUT THERE ARE SO MANY OF THEM, THE INFLUENCE IS SO LARGE, IT’S DIFFICULT. THEY MENTIONED ARTIFICIAL INTELLIGENCE TO TRY TO IDENTIFY THESE THINGS EARLIER ON, BUT IT’S A PEOPLE PROBLEM. WHEN YOU HAVE PEOPLE CREATING ACCOUNTS THAT ARE REAL LEGITIMATE, WHICH ARE NOT BOTS, OR AUTOMATED THINGS, THEY DON’T REALLY GET DETECTED UNTIL THEY GO VERY AGGRESSIVE OR OVERT IN THEIR CAMPAIGNS, SO WE ARE GOING TO SEE THIS IN THE 2020 ELECTION CYCLE, BOTH FROM RUSSIA AND CHINA, ESPECIALLY WITH THE TRADE WAR TALKS. IT’S GOING TO CONTINUE TO GROW. THERE’S NOT MUCH WE CAN DO ABOUT IT RIGHT NOW. >>LET ME PICK UP ON THE POINT ABOUT AI. WE ARE NOT JUST TALKING ABOUT TWEETS, AND WORDS. WE ARE TALKING ABOUT IMAGES THAT ARE BEING MANIPULATED, VIDEO THAT IS BEING MANIPULATED. WHAT HAS BEEN SURPRISING TO ME IS SO MANY OF THESE COMPANIES THAT ARE EVEN BEHIND THIS MANIPULATED VIDEOS, WE ARE SEEING THESE ARE THINGS THAT CAN NOW BE DONE FROM HOME. IT DOESN’T TAKE EXPERTS TO PUT TOGETHER A VIDEO THAT COULD GO VIRAL, AND SPREAD DISINFORMATION. ARE THESE ALGORITHMS — IS THE TECHNOLOGY FOR PLATFORMS LIKE FACEBOOK AND TWITTER REALLY KEEPING UP RIGHT NOW? CAN YOU TALK ABOUT THE EVOLUTION IN THE THREAT? AND HOW THE 2020 CYCLE COULD LOOK EVEN MORE DIFFERENT THAN 2016? >>THAT’S ONE OF THE BIGGEST CHALLENGES OF THE SECURITY INDUSTRY, LET ALONE SOCIAL MEDIA PLATFORMS, IS TRYING TO STAY AHEAD OF TECHNOLOGICAL ADVANCES WE SEE. WHEN WE TALK ABOUT MANIPULATING IMAGES, THE ABILITY TO MIX THEM IN. THERE WAS ONE WITH HILLARY CLINTON THAT LOOKED LIKE SHE WAS INTOXICATED, BUT IT WAS FAKE. YOU CAN ABSOLUTELY DO THAT FROM HOME. IT DOESN’T TAKE A TEAM OF PEOPLE TO CREATE THIS. WHAT’S INTERESTING IS, CAN YOU MANIPULATE AN IMAGE FROM DONALD TRUMP OR FROM A DEMOCRATIC NOMINEE, AND MAKE THEM LOOK OR APPEAR TO SAY SOMETHING VERY CRAZY, AND GET A HUGE WILDFIRE EFFECT GOING? IT GETS PUSHED DOWN LATER, BUT THE EFFECT IS STILL THERE. THESE COMPANIES DON’T HAVE ANYTHING TO IDENTIFY OR PROTECT AGAINST THESE. EVEN FACEBOOK SAID THEY WEREN’T GOING TO TAKE THAT IMAGE DOWN. THERE IS A LOT OF PROBLEMS WE ARE FACING BECAUSE TECHNOLOGY IS MOVING SO FAST. IT IS SOMETHING WE HAVE TO KEEP AN EYE ON. ESPECIALLY, FACEBOOK AND TWITTER ARE THE TWO MOST PROMINENT SOCIAL MEDIA PLATFORMS OUT THERE. THEY NEED TO DO AS MUCH AS POSSIBLE BECAUSE IT IS GOING TO BE INTERESTING TO SEE HOW IT TAKES OFF. >>DAVID, I APPRECIATE YOUR INSIGHTS. DAVID KENNEDY JOINING US FROM TRUSTED SEC. >>> LET’S GET TO OUR OTHER TICKERS. BEYOND MEAT SCORES ITS FIRST BULLISH CALL ON WALL STREET, AND HILTON BRAND LOCATIONS IS LEAPING ON REPORTS OF A POTENTIAL TAKEOVER. BUT FIRST, BITING SHARES ARE SOARING AFTER THE CHINESE COMPANY RECORDED SECOND EARNINGS. THE STOCK IS DOWN 30 PERCENT OVER THE YEAR. JARED, WALK US THROUGH SOME OF THE STOCK MOVES WE SCENE. WHAT IS PUSHING IN BAIDU HIGHER TODAY? >>IT WASN’T AS BAD AS IT COULD HAVE BEEN. AS WE WRAP UP, GOING FORWARD, THEY DO EXPECT TO GROW, BUT AT A SLOWER RATE. REVENUE COPIED BY A FEW PERCENTAGE POINTS. A REALLY BEAT BY ABOUT 60 PERCENT ON DPS. THEY HAD GOOD COST CONTROL, BUT AS THEY APPROACH A MORE SATURATED MARKET, ESPECIALLY WITH RESPECT TO MOBILE, THEY ARE TRYING TO DEVELOP THEIR ECOSYSTEM TO MONETIZE IT BETTER, AND GET TO OTHER AREAS. SO, VOICE SEARCH, FOR INSTANCE, AS AN AREA WHERE THEY ARE TRYING TO PROVE. THAT SPEAKS AS TO THEIR ABILITY TO GET INTO HOMES AND AUTOMOBILES. SMART HOMES AND AUTONOMOUS VEHICLES IS REALLY THE FEATURE FUTURE OVER THERE. WE SEE THE STACK UP NEARLY 60 PERCENT TODAY. YESTERDAY, IT WAS UP SEVEN PERCENT. BEFORE THAT, IT WAS UP MODESTLY. OVER THE LAST THREE DAYS, IT UPPED THE MOST IN SIX YEARS OVER THE SAME TIME PERIOD, BUT, AS YOU NOTED, IT REALLY HASN’T BEEN PERFORMING WELL OVER AN EXTENDED PERIOD OF TIME. YOU CAN SEE THE STOCK IS DOWN ABOUT 50 PERCENT RIGHT NOW. I MENTIONED MORGAN STANLEY. WE CAN SEE THE STOCK TRADING AT 110 RIGHT HERE. THEY HAVE A 170-PRICE TARGET. THAT IS ONE OF THE HIGHER PRICE TARGETS ON THE STREET THAT I SAW. OVERALL, THE ANALYSTS TAKE AWAY FROM THIS, THEY DO EXPECT GROWTH TO ACCELERATE IN THE FUTURE, AND THINGS ARE NOT AS BAD AS THEY COULD HAVE BEEN GIVEN THE CURRENT MACRO ECONOMIC HEADWINDS. >>YOU WALKED US THROUGH THE SPECIFICS. THIS COMPANY, LIKE SO MANY CHINESE TECH COMPANIES, IS STILL LARGELY DOMESTIC EVEN THOUGH IT IS TRADED HERE. DOES THIS STOCK, REGARDLESS OF PERFORMANCE, IN TERMS OF FINANCIALS, INEVITABLY GET TIED TO THE ECONOMIC PICTURE FOR CHINA? AND AS WE SEE DATA DECLINE, DOES BAIDU COME UNDER PRESSURE? >>Reporter: DEFINITELY. IT’S NOT JUST IDIOSYNCRATIC PRESSURE WITH REGARD TO WHAT THEY ARE DOING AS A COMPANY, BUT ALSO THE CHINESE MARKET HAS BEEN UNDER PRESSURE AS A WHOLE. THIS COMPANY, BAIDU VERSUS A SHANGHAI COMPOSITE OVER THE LAST YEAR SHOWS BAIDU DOWN 50 PERCENT. THE SHANGHAI IS UP ONLY MODESTLY AT FIVE PERCENT. IF YOU LOOK AT WHAT IT’S DOING VERSUS SOME OF ITS RIVALS, YOU CAN SEE 10 SENT HAS WEATHERED THE STORM A LOT BETTER, WHEREAS BAIDU HAS REALLY SHRUNK. AMONG SOME OF ITS PEERS, NOT REALLY HOLDING UP, AS WELL. ALSO LOOKING AT BAIDU VERSUS ALI BABA, A SIMILAR STORY, WITH ALI BABA BARELY TREADING WATER. THEY HAVE A FULLY OWNED SUBSIDIARY, WHICH YOU COULD CALL THE NETFLIX OF CHINA. THEY ARE FACING STREAMING WARS, TOO. JUST AS WE HAVE FOX AND DISNEY MOUNTING EFFORTS TO TAKE ON NETFLIX, AND AT&T WITH THEIR NEW PRODUCT OFFERINGS. ALL OF THIS SPEAKS TO THE POTENTIAL TO REALLY ACCELERATE THEIR COSTS GOING FORWARD. THAT COULD HURT DPS EVEN IF IT GENERATES MORE REVENUE FOR THE COMPANY. >>NO QUESTION, CONTENT IS EXPENSIVE. THANKS FOR THAT. >>>OUR FIFTH KICKER IS BEYOND MEAT. JPMORGAN UPGRADING THE PLANT- BASED MEAT COMPANY FROM NEUTRAL TO OVERWEIGHT. WE ARE SEEING THE STOCK UP MORE THAN SIX PERCENT. THIS COMES AFTER FALLING 40 PERCENT OFF OF ITS JULY HIGH. SCOTT GAMM IS BACK WITH ME FROM THE NEW YORK STOCK EXCHANGE, AND WE TALK ABOUT THE DECLINE WE SAW PRIOR TO THIS BULLISH CALL FROM JP M. HOW MUCH OF JAY P.M.’S CASE IS ABOUT VALUATION? >>Reporter: THE STOCK IS DOWN 40 PERCENT FROM ITS PEAK ON JULY 26 WHEN WE SAW BEYOND MEAT TRADING NEAR $40 A SHARE. JULY 26 WAS ALSO THE PEAK FOR THE S&P 500. A LITTLE BIT OF A COMPARISON THERE, AS WELL. BUT JPMORGAN NOW CALLS BEYOND MEAT APPEALING ONCE AGAIN. THE STOCK IS STILL UP ABOUT 500 PERCENT FROM THAT $45 IPO PRICE BACK IN EARLY MAY. THIS HAS BEEN AN INCREDIBLE RUN FOR BEYOND MEAT. WITH JPMORGAN, THEIR PRICE TARGET IS ABOUT $189 A SHARE. THAT IS FOR DECEMBER 2020. THAT WOULD BE ABOUT 23 PERCENT UPSIDE FROM WHERE THE STOCK IS TRADING RIGHT NOW, WHICH IS ABOUT $153 PER SHARE. THE OTHER THING JPMORGAN POINTED OUT WAS ETHAN BROWN, THE CEO, ONLY SOLD A SMALL PORTION OF HIS HOLDINGS DURING THE SECONDARY STOCK OFFERING A FEW WEEKS AGO. IT’S UNDERSTANDING THAT HE WOULD LOCK IN SOME OF THOSE GAMES, BUT HE IS CLEARLY STICKING BY THE STOCK. >>>LET’S MOVE ON TO OUR NEXT TICKER. THAT A ELTON BRAND VACATIONS. THE INVESTMENT FIRM APOLLO GLOBAL MANAGEMENT IS LOOKING TO BUY THE TIMESHARE COMPANY. ACCORDING TO THE NEW YORK POST, APOLLO IS LOOKING TO MERGE HILTON WITH DIAMOND WHICH IT PURCHASED IN 2016. INES FERRE IS BACK WITH ME. WHAT IS THE STRATEGY? >>SINCE APOLLO ACQUIRED DIAMOND RESORTS IN 2016, WHAT THEY ARE LOOKING TO DO IS CUT COSTS, INCREASE SCALE, BUY, A CHOIR A HILTON GRAND, AND SO, REPORTEDLY, WHAT APOLLO IS LOOKING TO DO, IS THEY ARE WILLING TO PAY UP TO $36 A SHARE, 28 PERCENT HIGHER THAN THE SHARE CLOSING PRICE FROM YESTERDAY. THAT IS A PREMIUM OF 28 PERCENT. APOLLO GAVE HILTON A COUPLE OF OPTIONS. ONE WOULD BE TO BUY HILTON GRAND AT A PREMIUM. THE OTHER WOULD BE FOR THEM TO MERGE WITH DIAMOND RESORTS, AND THEREFORE KEEP THE BUSINESS PUBLIC, BUT CERTAINLY THIS WOULD MAKE SENSE FOR APOLLO, AND ALSO THEIR CURRENT CFO CAME FROM HILTON RESORTS BEFORE, SO HE WAS THE CFO OF HILTON GRAND BEFORE ALSO GOING TO DIAMOND RESORTS. IT JUST MAKES SENSE AS FAR AS M&A ACTIVITY. >>LET’S TALK ABOUT THE TIMESHARE INDUSTRY. THIS LAW COMES INTO PLAY WHEN YOU PULL ALL THE ASSETS TOGETHER. >>THE UPSIDE IS IT IS SEEING GROWTH OVER THE LAST YEAR FOR THE NINTH CONSECUTIVE YEAR. YOU KNOW, YOUR TYPICAL CUSTOMERS ARE YOUNG FAMILIES, WHO WANT SOMETHING DEPENDABLE THAT THEY CAN HAVE A KITCHEN IN, THAT THEY KNOW WHAT THEY ARE GETTING. AS FAR AS HILTON GRAND IS CONCERNED, THEIR LAST EARNINGS REPORT WAS A BIT DISAPPOINTING BECAUSE THEY LOWERED THEIR FULL- YEAR GUIDANCE BECAUSE OF LIMITED INVENTORY AND CAPITAL IN SOME LOPEZ, AND MEXICO, AND ALSO THE BIG ISLAND OF HAWAII, AS WELL. THE STOCK HAD BEEN DOWN IN AUGUST ABOUT 12 PERCENT THROUGH YESTERDAY. TODAY, YOU ARE SEEING A POP ON THIS REPORT. >>INTERESTING TO SEE THE TIMESHARE STOCKS. >>TIMESHARES ARE SEEING A BOOST. >>THANK YOU FOR THAT. >>>COMING UP, HOW INVESTORS SHOULD PREPARE AHEAD OF THE CLOSELY WATCHED JACKSON HOLE CONFERENCE LATER THIS WEEK. >>>PLUS, A NEW REPORT REVEALS THE JAW-DROPPING AMOUNT APPLE IS SPENDING ON ITS ORIGINAL STREAMING CONTENT. >>>CENTRAL BANKERS ARE GEARING UP FOR THE ANNUAL POLICY CONFERENCE IN JACKSON HOLE, WYOMING THIS WEEK. JOINING US FOR A PREVIEW IS DANIELLE DE MARTINO FROM QUILL INTELLIGENCE AND FORMER ADVISOR TO THE PRESIDENT. IT’S ALWAYS GOOD TO HAVE YOU ON. GIVE ME A SENSE OF WHAT YOU ARE LOOKING TO HERE COME JACKSON HOLE. >>I THINK INVESTORS ARE EXPECTING A LOT. I DON’T THINK JAY POWELL NECESSARILY WANTS TO DELIVER ON IT, BUT HE HAS HAD SO MANY MISSTEPS WHERE HE SENT THE MARKET CAREENING. I THINK THERE IS SENSITIVITY RIGHT NOW BECAUSE WE HAVE SEEN UNPRECEDENTED VOLATILITY. WE’VE HAD TWO BACK TO BACK WEEKS OF A MONDAY LOSS, AND A TUESDAY GAME THAT EXCEEDED ONE PERCENT. TWO BACK-TO-BACK WEEKS FOR THE FIRST TIME SINCE 1952. I THINK THE FED WILL BE EVEN MORE SENSITIVE TO MARKET REACTION, AND HE NEEDS TO DELIVER ON THAT MESSAGE. >>YOU TALK ABOUT THE VOLATILITY. BOB SCHILLER MADE COMMENTS TODAY SAYING THERE IS A PROBLEM WITH CUTTING RATES BECAUSE IT SHOWS ALARM. YU MADE AN INTERESTING ANALOGY. IT’S LIKE WHEN YOUR DOCTOR GIVES YOU PENICILLIN, AND YOU THINK I’M REALLY SICK. IF THAT WAS THE MESSAGE THAT THE FED RATE CUTS GAVE TO INVESTORS, WHAT DOES JAY POWELL NEED TO SAY, TO MAY BE, CALM SOME OF THOSE JITTERS? >>I THINK WHAT DOCTOR SCHILLER IS REFERRING TO, AT LEAST IN MY MIND, I THINK, MAYBE, THE MESSAGE IS HE IS ALARMING HOMEOWNERS. THEY WANT THEIR LIQUIDITY, THEIR GE. IT’S ANOTHER THING TO GIVE HOUSEHOLDS A HEADS UP THAT THIS IS THE BEGINNING OF A RATE CUTTING CYCLE. THESE ARE TYPICALLY THE THINGS WE DO BEFORE A RECESSION. THAT’S NOT THE MESSAGE THE FEDERAL RESERVE WANTS TO BE BROADCASTING. THEY ARE TRYING TO THREAD THE NEEDLE. >>WE HAVE TALKED ABOUT PRESSURE FROM THE WHITE HOUSE. ONE IS JUST PRESSURE TO CUT FURTHER. THE OTHER SEEMS TO BE THE WHITE HOUSE’S EXPECTATION OF WHAT A FEDERAL RATE CUT WILL ACTUALLY DO, WITH PRESIDENT TRUMP SAYING THE ECONOMY WOULD BE PUSHING EVEN HIGHER IF THE FED CUT IT MORE. HE TALKED ABOUT 100 BASIS POINTS. HOW DOES JAY POWELL MANAGE THAT?>>WE HAVE SEEN THAT. I THINK JAY POWELL HAS BEEN POINTEDLY ASKED ON SEVERAL OCCASIONS, WHAT DO YOU THINK THIS WILL ACCOMPLISH? DO YOU THINK THIS IS GOING TO SPUR COMPANIES TO MAKE MORE INVESTMENT, AND THEREFORE HIRE MORE PEOPLE? GIVEN HOW LOW INTEREST RATES ARE TODAY IN THE U.S., IT’S NOT GOING TO SPUR CAPITAL EXPENDITURES. IT WOULD BE BETTER FOR THE MANUFACTURING SECTOR IF THERE WAS WAR ON THE TRADE FUND, WHICH IS SOMETHING THE PRESIDENT CAN DELIVER ON RIGHT NOW. THERE MIGHT BE TOO MUCH PRESSURE ON THE MONETARY AUTHORITIES, WHICH IS WHY WE ARE HEARING RUMBLINGS ABOUT FISCAL RELIEF OF SOME KIND COMING OUT OF THE WHITE HOUSE. >>Reporter: HOW REAL DO YOU THINK THE RECESSION THREAT IS? >>MORE THAN ANYTHING WE’VE SEEN BLEED FROM THE INDUSTRIAL RECESSION, WHICH IS IN THE BOOKS. WE’VE GOT TWO QUARTERS BACK-TO- BACK OF INDUSTRIAL PRODUCTION CONTRACTING, AND THEN A SURPRISE DOWNSIDE WHEN WE HIT THE LATEST IP FIGURE. I THINK IT’S ESTABLISHED THAT A MANUFACTURING CENTER IS CONTRACTING RIGHT NOW. WHAT’S ALARMING IS THIS WEEK HAS SPREAD INTO THE TRANSPORTATION SECTOR. TRANSPORTS LED THE ECONOMY IN LATE 2017, GOING INTO 2018. THAT IS NOT WHAT WE WANT TO SEE. THAT IS A SERVICE SECTOR. WE HAVE SEEN ALARMIST DATA COME OUT ON THIS. ON THE OTHER HAND, THE MORE PRODUCTION CUTS WE HAVE, THE LESS GOODS THERE ARE TO MOVE AROUND THE COUNTRY. >>WE KNOW WITH THE FED MANDATE IS. PUBLICLY, THEY WILL CONTINUE TO MAINTAIN THAT, BUT I WONDER HOW MUCH OF THE MARKET VOLATILITY YOU THINK THEY’VE BEEN WATCHING, AND HOW MUCH IS LIKELY TO GUIDE POLICY. >>I THINK VOLATILITY HAS TO PLAY INTO POLICYMAKING BECAUSE IT’S UNDER THE FED’S PURVIEW. FINANCIAL STABILITY IS PART OF WHAT THE FED IS MANDATED TO MAINTAIN. IT DOESN’T HELP THAT YOU HAVE THE YUEN STRENGTHENING. YOU HAVE TO BE COGNIZANT OF THE FACT THAT YOU HAD A MAJOR MEMBER OF THE EUROPEAN CENTRAL BANK MENTION THE WORD BAZOOKA. IT’S APPARENT THEY ARE GOING TO FORGE FORWARD WITH QUANTITATIVE RATES DEEPER INTO NEGATIVE TERRITORY. THAT TENDS TO NEED AN ANSWER FROM THE FED. THAT BECOMES PROBLEMATIC BECAUSE RATES ARE ALREADY SO LOW. >>LET ME PICK UP ON THAT POINT. THE FED DOESN’T OPERATE IN A VACUUM, AND YET WE HEARD PETER NAVARRO SORT OF SAY THERE ARE A LOT OF IF’S OUT THERE THAT CAN REACH IN FAVOR OF THE U.S. ECONOMY. GERMANY HAS NOW COME OUT AND SAID THEY WILL BE ABLE TO PUSH IT. HOWL MUCH CAN THE FED DO TO GUIDE THE U.S. ECONOMY AT A TIME WHEN TRADE POLICY IS AFFECTING EVERY OTHER COUNTRY OUT THERE? >>THE PROBLEM FOR JAY POWELL AND HIS ASSOCIATES IS IT’S NOT JUST THE U.S. AT THE UNIVERSITY OF MICHIGAN, THERE WAS ANXIETY ON PART OF HOUSEHOLDS ABOUT PERCEPTIONS OF JOB AVAILABILITY. I THINK THERE IS A MATERIAL SPILLOVER EFFECT FROM THE TRADE WAR, AND SOME OF THE WEAKENING ECONOMIES IN THE REST OF THE WORLD, INTO THE U.S. ECONOMY. I FEAR, FOR THE LAST TIME, WE SAID WE WERE PERMANENTLY DECOUPLED FROM THE REST OF THE WORLD. THAT DIDN’T END WELL IN 2007. >>GREAT TO GET YOUR INSIGHTS. >>>TUNE IN TO YAHOO FINANCE ON FRIDAY. THAT’S AT 11:30 A.M. EASTERN. OUR FED WATCHER WILL SPEAK WITH CLEVELAND PRESIDENT LORETTA MEISTER ON “ON THE MOVE” AT 11:30 EASTERN SUNDAY. OUR FIRST TIGARD TODAY WAS HOME DEPOT. IT CAME UP SHORT ON SALES ESTIMATES IN THE SECOND QUARTER, AND CUT ITS FULL-YEAR REVENUE OUTLOOK, BUT THE COMPANY TOPPED EXPECTATIONS DUE TO STRENGTH IN HOUSING AND MARKET EXPECTATIONS. GOALS DELIVERED BETTER THAN EXPECTED QUARTERLY EARNINGS BUT WARNS ABOUT A LARGER THAN EXPECTED PROFIT MARGIN FOR THE FULL YEAR, CITING A NEGATIVE IMPACT FROM LOOMING NEW TARIFFS. OUR THIRD TICKER WAS U.S. STEEL. IT HAS LAID OFF DOZENS OF WORKERS AT ONE OF ITS BIG PLANTS IN MICHIGAN, WITH PLANS TO TEMPORARILY LET GO OF UP TO 200 MORE BECAUSE OF ONGOING CHALLENGING MARKET CONDITIONS. >>>IT’S OUR LAST TICKER OF THE DAY. THAT’S APPLE. THE TECH GIANT REPORTEDLY LOOKING TO SPEND $6 BILLION ON ORIGINAL CONTENT FOR ITS NEW VIDEO STREAMING SERVICE, LIKE THE HIGHLY ANTICIPATED SERIES MORNING SHOW. TAKE A LOOK AT THIS PREVIEW. >>GOOD MORNING. I AM BRINGING YOU SAD AND UPSETTING NEWS. WHILE I DON’T KNOW THE DETAILS OF THE ALLEGATIONS — >>SHE THREW ME UNDER THE BUS. >>MITCH KESSLER, MY CO-HOST, AND PARTNER OF 15 YEARS, WAS FIRED TODAY. >>THAT SHOW, WE SHOULD POINT OUT, REPORTEDLY COST MORE ON A PER EPISODE BASIS THAN THE FINAL SEASON OF HBO’S “GAME OF THRONES.” LET’S JUST TALK ABOUT THE INVESTMENT IN CONTENT. WE ARE TALKING ABOUT THIS BECAUSE APPLE INITIALLY SAID THEY WOULD INVEST ROUGHLY $2 BILLION. NOW, THAT NUMBER HAS ESCALATED SIGNIFICANTLY. IT’S AN EXPENSIVE BUSINESS TO BE IN. >>EVERYBODY IS UPPING THE ANTE. WE HAVE JENNIFER ANISTON, STEVE CARELL, SO WHAT ARE THE TWO TOP SHOWS ON NETFLIX? “FRENZY IN AND “THE OFFICE.” STEALING SOME OF THE THUNDER FROM NETFLIX, WHICH IS SPENDING AN INCREDIBLE AMOUNT OF MONEY. I THINK THIS SPEAKS TO THE ZEITGEIST. IF YOU WANT TO COMPETE, YOU HAVE TO SPEND A LOT OF MONEY. I DON’T THINK THIS WILL SHAKE OUT WELL FOR THE PLAYERS. THERE WILL HAVE TO BE WINNERS AND LOSERS, AND IN THIS CASE, WE WILL SEE IF APPLE CAN DELIVER. $15 MILLION PER SHOW, I THINK IT’S OBVIOUS THEY ARE NOT SPENDING THAT MONEY ON SPECIAL EFFECTS. THAT’S GOING TO THE ACTORS AND ACTRESSES. IT’S A GAME YOU’VE GOT TO PLAY. >>IT REALLY JUST TAKES ONE SHOW TO SET THE STAGE FOR SOME OF THESE STREAMING SERVICES. WHAT DOES THIS CHANGE FOR THE INVESTMENT CASE FOR APPLE GIVEN THAT THEY WILL PROBABLY HAVE TO SPEND BILLIONS MORE TO KEEP UP WITH THE COMPETITION? >>I THINK IT’S INTERESTING THAT THE CONTENT SEEMS TO DRIVE SUBSCRIPTIONS A LOT OF TIMES. JUST THINK ABOUT THE TIMES THAT YOU HAVE SOME SUBSCRIBED TO HBO BECAUSE OF “GAME OF THRONES.” OR SHOWTIME BECAUSE OF “BILLIONS.” THE CONTENT IS NOW DRIVING THE SUBSCRIPTIONS, AND IT HAS TO BE STELLAR, EXCELLENT CONTENT. WHEN YOU’RE TALKING ABOUT AMAZON, DISNEY, DISNEY PLUS. ALL OF THE PROPERTIES THAT DISNEY OWNS. IT’S JUST A REALLY COMPETITIVE LANDSCAPE. >>LET’S GO BEYOND THE TICKER PACK CEREALS. MAKERS ARE DOUBLING DOWN ON SUGARY VERSIONS AND ADVERTISING IT AS A LATE NIGHT SNACK ACCORDING TO A STORY FROM THE “WALL STREET JOURNAL”. RETAILERS ARE EVEN LOWERING THE NUMBER OF MAJOR CEREAL BRANDS AVAILABLE IN STORES, ACCORDING TO NIELSEN DATA. HOW DO THESE COMPANIES KEEP UP WITH CHANGING TASTES? IT’S NOT JUST ABOUT CEREAL. WE HAVE GRANOLA AND SO MANY OTHER OPTIONS IN THE MORNING. >>THEY CAN STOP SELLING POISON. OVER LONG PERIODS OF TIME, YOU CAN HAVE LOW-LYING INFLAMMATION, AND RESULTS ARE NOT GOOD. THEY ARE FIGHTING A LOSING BATTLE. TRENDS ARE GOING THE OPPOSITE DIRECTION. THEY NEED TO DIVERSIFY AND STOP RELYING ON WHAT HAS TRADITIONALLY BEEN A HIGH- MARGIN OFFERING. >>WHAT’S YOUR ADVICE TO THESE CEREAL MAKERS? >>Reporter: FRIENDS ARE GOING TOWARD FRESH. CEREAL LASTS FOR A LONG TIME. THEY HAVE TO KEEP UP WITH THE TRENDS. >>THANKS SO MUCH. >>>COMING UP, WHAT HOME DEPOT’S LATEST RESULTS MAYBE INDICATING ABOUT THE STATE OF THE U.S. ECONOMY. STAY TUNED. THE FINAL ROUND IS COMING UP NEXT. >>> I AM JEN ROGERS IN NEW YORK. THIS IS THE FINAL ROUND. THE STOCKS SLIPPING TODAY AS THE DOW LOOKS TO STAMP A THREE- DAY WINNING STREAK. >>INVESTORS ARE RUSHING BACK TO SAFETY, PUSHING BOND YIELDS LOWER AGAIN. WE WILL HAVE MORE ON THAT AND MARKET ACTION COMING UP IN A BIT. >>>AND WHAT SOME OF THE BIGGEST STEEL COMPANIES ARE SAYING AHEAD OF TRUMP TARIFFS. >>>AND MOVE OVER NETFLIX. APPLE JOINS THE STREAMING VIDEO FIGHT. JUST WAIT UNTIL YOU HEAR HOW MUCH THEY ARE SPENDING. WILL CONSUMERS BITE? PLUS, IT’S GOT THE KARDASHIAN STAMP OF APPROVAL. THE COMPANY IS LOOKING TO GET INTO CBD. YOU ARE LOOKING RIGHT THERE. WE’VE GOT TRIPLE DIGITS ON THE DOW. THE DOW, FALLEN FOR THE FIRST TIME IN FOUR DAYS. IT HIT NEW LOWS AFTER SPEAKING TO THE PRESS, TELLINGREPORTERS THAT THE U.S. WAS NOT READY TO MAKE A DEAL WITH CHINA, AND REITERATING THAT WE NEED ANOTHER RATE CUT. OVERALL, MARKET REACTION HAS BEEN PRETTY MUTED FOLLOWING THE PRESIDENT’S SPEECH. WE’VE GOT IBM LOWER, AMERICAN EXPRESS, DELL INC., ALL OF THOSE. BANK STOCKS, ALSO UNDER PRESSURE AS TREASURY YIELDS PULL BACK. THE 10-YEAR TREASURY DOWN ABOUT 1.55 PERCENT. OF COURSE, WE ARE GOING TO GET BIG HEADLINES OUT OF JACKSON HOLE. WE ALSO HAVE THE MINUTES TOMORROW, BUT THAT’S ONE THING YOU’VE BEEN TALKING ABOUT IS BOND MARKET’S TELLING EQUITIES WHAT TO DO. IS THIS PLAYING OUT AGAIN? >>TO SOME EXTENT. IT’S CALMER THAN WE’VE BECOME ACCUSTOMED TO SEEING IN THE STOCK MARKET OVER THE LAST SEVERAL SESSIONS, BUT WE STILL HAVE YIELDS AND STOCKS LOWER, SO I SUPPOSE ON THE BROAD THESIS OF THE STOCK MARKETS, MOVING UP OR DOWN FOLLOWING THE YIELD ON THE 10-YOUR NOTE, WE HAVEN’T REALLY BROKEN THE PATTERN PER SE, BUT I THINK YOU WERE CERTAINLY ENCOURAGED IF YOU WERE LOOKING FOR CALMER MARKET CONDITIONS TO PREVAIL, TO GET A SENSE OF MORE SOLID FOOTING. YOU ARE PROBABLY ENCOURAGED BY WHAT YOU ARE SEEING. EVERY DAY HAS HAD SO MUCH NOISE ABOUT WHAT’S MOVING. WHY ARE WE GOING THIS HIGH OR THE SLOW? I THINK THERE ARE POSITIVE THINGS TO TAKE AWAY JUST FROM THE RELATIVE CALM OF TODAY’S SESSION, BUT AS WE NOTED, MINUTES AND THEN JACKSON HOLE. IT’S NOT LIKE WE CAN COMPLETELY SHUT OFF OUR MINDS. >>WE DEFINITELY DON’T HAVE A SLOW NEWS CYCLE COMING UP. WE ALSO HAVE A LOW LIQUIDITY ISSUE. >>THE THING IS, THAT’S TRUE, BUT THE MARKET MOVES A LOT IN OCTOBER. PEOPLE SAY THERE IS NO LIQUIDITY. EVERY TIME THE MARKET MOVES, IT’S BECAUSE THERE IS NO LIQUIDITY. A LOT OF IT GOES BACK TO 2010 WHEN WE HAD THE ACTUAL FLASH CRASH, WHICH WAS BASICALLY FRONT RUNNING. THAT’S NOT QUITE RIGHT, BUT BASICALLY GHOST TRADING. IT’S LITERALLY A LACK OF LIQUIDITY. THE POINT BEING, I DO THINK WHEN THE MARKET MOVES A LOT, PEOPLE SAY THINGS LIKE THERE IS NO LIQUIDITY. THERE’S NEVER ANY LIQUIDITY ANYMORE. >>ESPECIALLY WHEN PEOPLE ARE SELLING, AND RUNNING FOR THE EXITS. >>IT’S THE SAME WAY THAT WE ALWAYS HEAR ABOUT THE ALGORITHMS, OR EVEN BETTER, THE LOGARITHMS. YOU NEVER HEAR ABOUT THEM WHEN THE MARKET GOES UP. BUT TODAY WAS A GOOD ONE TO HEAR ABOUT. WHAT WAS I LOOKING AT? THE CONVEX HEDGE EATING HEDGING. JPMORGAN WITH A NO THERE. THERE WAS A LOT OF DETAIL. I DON’T KNOW. I FOUND IT. I HAD TO GOOGLE A LOT OF THINGS IN THERE. IT’S BASICALLY ALL ABOUT RISK MANAGEMENT. >>I THINK THE WAY THE MARKET HAS BEEN BEHAVING, COMING FROM JPMORGAN, WHICH INVESTORS TEND TO LISTEN TO. THIS IS WHAT THEY THINK HAS BEEN DRIVING THE MARKET. THEY OFTEN TALK ABOUT WHAT THEY CALL TECHNICAL FLOWS, SO THAT’S BASICALLY, IF YOU HAVE A PORTFOLIO RUNNING A SPECIFIC STRATEGY, FOR INSTANCE A MORTGAGE PORTFOLIO, AND ALL OF A SUDDEN LONG RATES GO DOWN A LOT, THE DURATION OF YOUR PORTFOLIO SHORTENS, AND SO YOU NEED TO ACTUALLY BUY LONGER DATED ASSETS AS THE PRICE GOES UP BECAUSE YOUR PORTFOLIO NEEDS TO BE A CERTAIN DURATION, OR, FOR EXAMPLE, LET’S SAY YOU ARE SHORT VOLATILITY. THE FIX GOES UP A LOT, AND YOU NEED TO GET OUT OF THAT POSITION, OR IF THE FIX GOES DOWN A LOT, YOU MIGHT NEED TO GET EVEN MORE SHORT VOLATILITY BECAUSE OF HOW YOU WANT YOUR POSITION BALANCED. POINT BEING, THIS IS STUFF THAT’S HAPPENING REGARDLESS OF WHETHER TRUMP TWEETED ABOUT TRADE OR NOT. THAT’S KIND OF THE REMINDER. >>AND THEY BROKE IT DOWN IN SUCH DETAIL IN TERMS OF WHAT WAS FUNDAMENTAL, AND THEN WHAT WAS TECHNICAL REFLECTION OF WHAT WAS HAPPENING IN THERE. IT COULD BE ENCOURAGING IF YOU ARE BULLISH TO THINK THIS IS A TECHNICAL MOVE. IF YOU ARE RUNNING AN MBS PORTFOLIO, GO OUT A LITTLE LONGER. THAT’S WHAT YOUR RISK MANAGEMENT FORCES YOU TO DO. MAYBE, WE SHOULD BE ENCOURAGED BY TODAY’S MARKET ACTION WITH THE PRESIDENT COMING OUT TO SPEAK ON A VARIETY OF ISSUES FROM TRADE TO POSSIBLY LOOKING AT SOME SORT OF TAX CUT. WE TALKED ABOUT THAT, WHICH THE ECONOMY IS DOING GREAT, BUT STILL. I THINK THE POINT IS, NO MATTER WHAT HE SAID IS THAT THE MARKET DID NOT MOVE. THAT IS MY TAKE AWAY. HE WAS SPEAKING A SHORT TIME AGO, LOOKING AT LIVE PICTURES. NOT LIVE, TAPED PICTURES HERE THAT ARE COMING IN. THE POINT OF THE MATTER IS THE HEADLINES HAVE ALREADY HIT, AND THE MARKET DIDN’T MOVE. >>WHAT DO THEY ALWAYS SAY IN THE GULF TELECAST. JUST A MOMENT AGO. ALL RIGHT. LET’S GO MORE ONTO TODAY’S MARKET. LET’S TALK ABOUT SHARES OF KOHL’S. THEY ARE UNDER PRESSURE DESPITE PROFITS THAT BEAT ESTIMATES. SCOTT GAMM IS ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE WITH MORE. >>Reporter: YES. ASIDE FROM THAT BURNING SPEED, REVENUE DID MISS EXPECTATIONS, AND FELL 3 PERCENT YEAR OVER YEAR. SAME-STORE SALES, WHICH IS THE METRIC WE WATCH CLOSELY IN RETAIL FELL 2.9 PERCENT YEAR OVER YEAR. WALL STREET WAS EXPECTING A DECLINE OF 2.5 PERCENT, SO I THINK THAT SALES DECLINE, PERHAPS INVESTORS WERE EXPECTING MORE OUT OF KOHL’S PARTNERSHIP WITH AMAZON, WHICH HAS BEEN GETTING A LOT OF ATTENTION RECENTLY, WHERE CUSTOMERS CAN RETURN AMAZON ITEMS IN KOHL’S STORES, WITH THE HOPE BEING THAT WHILE THEY ARE THERE, MAYBE, THEY WILL PICK UP A PAIR OF SOCKS OR SOMETHING ELSE AT KOHL’S. KOHL’S CEO MICHELLE GASS SAID TODAY, THE COMPANY IS CONFIDENT THE AMAZON PARTNERSHIP WILL CONTINUE TO CONTRIBUTE TO THE BOTTOM LINE THROUGHOUT THE REST OF 2019. THE OTHER KIND OF FACTOR WHEN IT COMES TO THE DECLINE WE ARE SEEING IN KOHL’S SHARES TODAY, AND BY THE WAY, IT’S THE WORST PERFORMING STOCK IN THE S&P 500 TODAY, DOWN OVER SIX PERCENT, IS THE FACT THAT KOHL’S SHARES KIND OF ROSE OVER THE PAST COUPLE OF TRADING SESSIONS, SO THAT’S ALWAYS A RISK FOR A STOCK, WHEN IT RUNS UP HEADING INTO EARNINGS. IF THE TREND ISN’T A BLOWOUT, IT’S A RISK OF DECREASE. WE ALSO HEARD FROM TJX, THE PARENT OF T.J. MAXX. SAME-STORE SALES ROSE TWO PERCENT YEAR OVER YEAR. WALL STREET WAS LOOKING FOR A THREE PERCENT GAIN, GUIDANCE FOR TJX COMING IN BELOW ESTIMATES. THE STOCK WAS IN THE RED FOR MOST OF TODAY’S TRADING SESSION, AND JUST A FEW MOMENTS AGO, THE STOCK MOVED INTO THE GREEN. TJX HAS BEEN A STANDOUT IN THE RETAIL SECTOR WITH THE STOCK UP ABOUT 15 PERCENT, SO FAR THIS YEAR. THAT’S COMPARED TO A FIVE PERCENT DECLINE IN THE BROADER RETAIL SECTOR. THE TJX EXPERIENCE OR T.J. MAXX EXPERIENCE CAN’T REALLY BE REPLICATED ONLINE. WHEN YOU GO INTO A T.J. MAXX, YOU ARE ON A SCAVENGER HUNT TO FIND A GOOD DEAL. PEOPLE LIKE THAT. THAT’S ONE WAY THAT TJX IS A LITTLE BIT INSULATED FROM THE SURGE IN ONLINE RETAIL. >>SCOTT GAMM LIVE ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. >>>AS THE TRADE WAR WITH CHINA RAGES ON, A COUPLE OF AMERICAN COMPANIES ARE FEELING THE HEAT. HOME DEPOT REPORTED SECOND- QUARTER RESULTS THAT BEAT ANALYST FORECASTS, CUTTING ITS FULL-YEAR FORECAST DUE TO THE POTENTIAL IMPACT OF TARIFFS ON CONSUMER ACTIVITY. THIS IS THE LATEST SAYING TARIFFS WILL NEGATIVELY IMPACT SALES AND PROFITS. THIS IS THE BIGGEST PERFORMER RIGHT NOW. THEY BASICALLY CAME OUT AND SAID SAME-STORE SALES? WE THOUGHT THEY WOULD BE FIVE PERCENT, BUT THEY WILL BE FOUR PERCENT. BUT, I GUESS IT’S BETTER THAN EVERYBODY THOUGHT IT WAS GOING TO BE, AND IT IS RALLYING HUGE HERE. DID PEOPLE THINK IT WOULD BE WORSE? >>I THINK THIS STORY IS EVERYTHING WE TALKED ABOUT. I BELIEVE IT WAS ON FRIDAY. I WAS SORT OF OUT THERE BEING LIKE, LOOK, GREAT RETAIL SALES NUMBERS. LITTLE REASON TO THINK THE ECONOMY IS ROLLING OVER. I THINK HOME DEPOT COMING OUT, SAYING WE DON’T SEE A RECESSION, AND WE CONTINUE TO SEE SALES GROW EVEN AT A SLOWER PACE THAN PREVIOUSLY FORECAST, AND WE CONTINUE TO SEE RATES COME DOWN, WHICH IS POSITIVE FOR HOUSING. BUT, THE TAKE WAS BASICALLY LIKE, WE CONTINUE TO HEAR FROM EXECUTIVES THAT TARIFFS ARE A PROBLEM. WE ARE CUTTING OUR GUIDANCE. WE THINK MARGINS WILL BE WORSE. HE IS OF THE MIND THAT HE WILL BELIEVE THE EXECUTIVES. THAT MAKES THINGS LOOK A LOT WORSE THAN THE MARKET WOULD OTHERWISE SUGGEST, OR THE STOCK MARKET, I SHOULD SAY, WOULD OTHERWISE SUGGEST. IT’S INTERESTING TO SEE STOCK UP FOUR PERCENT ON A DAY WHEN THE COMPANY, IT’S NOT LIKE THEY BURIED IT. THEY CAME OUT RIGHT IN THE RELEASE, IN THE PRESS RELEASE, AND MENTIONED TARIFFS, WHICH I THINK IS PRETTY MUCH STRAIGHTFORWARD, BUT THE STREET, LOOKING AT A COMPANY THAT CONFIRMED GUIDANCE ON AN EARNINGS PER SHARE BASIS. THERE IT IS. >>YOU CAN HAVE A RECESSION AND HAVE THE CONSUMER BE DOING OKAY. THERE WAS CONSUMER GROWTH IN 2001. THE BUSINESS CYCLE IS THE BUSINESS CYCLE. BUSINESS EXECUTIVES COULD BE TELLING US SOMETHING. JUST BECAUSE THE CONSUMER IS DOING OKAY DOESN’T NECESSARILY COMPLETELY. I KNOW THESE RESULTS CAN BE CONFOUNDING, BUT GO, HOME DEPOT. BIGGEST PERFORMER ON THE DOW. >>>AMERICAN STEEL UNDER PRESSURE. UNITED STATES STEEL, SET TO LAY OFF WORKERS TEMPORARILY IN MICHIGAN, ACCORDING TO REUTERS. THE COMPANY STOCK PRICE HAS PLUNGED 73 PERCENT SINCE MARCH 1, 2018, WHEN PRESIDENT TRUMP ANNOUNCED HIS DECISION TO CRACK DOWN ON FOREIGN IMPORTS. JUST LAST WEEK IN PENNSYLVANIA, TRUMP SAID HIS 25 PERCENT TARIFF HAS TURNED A DEAD BUSINESS INTO A THRIVING ENTERPRISE. DO THRIVING ENTERPRISES OFTEN HAVE LAYOFFS? >>THE STOCK IS DOWN 70 PERCENT SINCE TARIFFS WERE ANNOUNCED. I THINK THAT SAYS IT ALL. I DON’T THINK ANYONE BELIEVED THE SECULAR DECLINE IN AMERICAN STEEL PRODUCTION, WHICH ISN’T LIKE A NEW THING — IT’S LITERALLY 50 YEARS OLD, IF NOT OLDER, WAS GOING TO BE REVERSED UNDER THIS PRESIDENT OR ANY PRESIDENT. THERE IS ENVIRONMENTAL REASONS STEEL PRODUCTION IS PROBABLY NEVER COMING BACK TO THE U.S. WITH WORKFORCE LIMITATIONS, ON WHOEVER IS QUALIFIED OR WANTS TO WORK AT THESE PLACES. U.S. STEEL WAS ANNOUNCING TEMPORARY LAYOFFS. WHO KNOWS EXACTLY HOW LONG THEY WILL LAST. IT COULD BE OVER SIX MONTHS, BUT THERE’S NOT A TON OF VISIBILITY ON THAT. THE REASON 200 TEMPORARY LAYOFFS IN A BUSINESS THAT DOES HAVE REGULAR LAYOFFS, LIKE AUTO, IS BECAUSE THIS IS HAPPENING IN MICHIGAN. THE ELECTION IS, FROM A POLITICAL STANDPOINT, COMING DOWN TO PENNSYLVANIA, OHIO, MICHIGAN, WISCONSIN. IF ANY OF THOSE STATES HAS MATERIALLY NEGATIVE NEWS ON THE MANUFACTURING FRONT, THAT’S WHY REUTERS IS COVERING THIS STORY WITH THE AMOUNT OF ENTHUSIASM AS IT IS. I WOULD EXPECT MANY OTHER STORIES TO BE LIKE THIS BECAUSE THAT’S WHAT IT COMES DOWN TO. A COUPLE HUNDRED THOUSAND VOTES IN FOUR STATES. >>YOU KNOW HOW WE SAID YOU CAN HAVE A RECESSION EVEN IF THE CONSUMER IS DOING WELL, OUR NEXT GUEST SAYS YOU CAN’T HAVE IT WITHOUT JOB LOSSES. WE WILL GET INTO THIS A LITTLE BIT MORE. WE HAVE JOB LOSSES TO REPORT. >>A MAN AFTER MY HEART. >>>EVERYONE IS RINGING ALARM BELLS ABOUT A RECESSION IN THE MANUFACTURING SECTOR. CHRIS ROUGHY, AN ECONOMIST WILL JOIN US TO SAY WHO CARES? WHY HE IS NOT WORRIED ABOUT THE U.S. MANUFACTURING BASE. BUT FIRST, LET’S LOOK AT SOME INDUSTRIAL TRUCKS STOCKS. >>>AMID TALK ABOUT U.S. ECONOMIC RECESSION, LET’S TALK ABOUT THE MANUFACTURING SECTOR. IS THAT IN RECESSION? IF IT IS, WHAT IT REALLY EVEN MATTER? WE HAVE THE CHIEF ECONOMIST AT FG UNION BANK. HE JOINS US TO DISCUSS. LET’S TALK ABOUT U.S. MANUFACTURING, THE ROLE IT PLAYS IN THE ECONOMY. CERTAINLY, THE EUROPEAN MANUFACTURING SECTOR APPEARS TO EITHER BE IN RECESSION, NEARING RECESSION, SO WHAT ARE YOU SEEING FROM THE MANUFACTURING BASE IN THE U.S.? WHAT SORT OF ROLE DOES IT PLAY IN THE BROADER CONVERSATION ABOUT THE HEALTH OF OUR ECONOMY?>>WHAT’S VERY IMPORTANT FOR FED OFFICIALS IS THE ISM MANUFACTURING INDEX, THE SURVEY OF PURCHASING MANAGERS. I KIND OF THOUGHT THAT WAS SOMETHING WE SHOULDN’T LOOK AT ANYMORE, BUT I GUESS THE MARKET WILL CHASE IT. ANYWAY, IT’S STILL POSITIVE AT THE MOMENT. THE PURCHASING MANAGER’S NUMBER WAS QUITE HIGH. IT CAME DOWN CLOSE TO THE 50 LINE THAT DIVIDES CONTRACTING MANUFACTURING FROM RISING, BUT IT HASN’T GONE THROUGH, SO AT THE MOMENT, MANUFACTURING IS STILL EXPANDING, ACCORDING TO THE PURCHASING MANAGERS. THEN YOU GET THE INDUSTRIAL PRODUCTION DATA WHICH IS THE FED’S OWN DATA. IT’S THEIR STATISTIC PRIMARY ECONOMIC STATISTIC, AND IT HAS BEEN FALLING ABOUT 1.5 PERCENT THIS YEAR, A FACT THAT CANDIDATE ELIZABETH WARREN SEIZED ON, AND SPLASHED OUT, SAYING THE U.S. IS IN A MANUFACTURING RECESSION. >>IF WE WERE, WE TALK A LOT ABOUT ITS 15 PERCENT OF OVERALL GDP. WE SAW A MANUFACTURING RECESSION IN 2014, 2015, 2016 WITH THE OIL CRASH, AND LACK OF INVESTMENT FROM THE OIL PATCH IN GENERAL, SO DOES THAT HAVE AS MUCH IMPORTANCE AS OVERALL ECONOMIC HEALTH, AS THE MARKET DOES WHEN THE ISM NUMBER COMES OUT EVERY MONTH? >>I ALWAYS REMEMBER HOUSING WAS A SMALL PORTION OF THE ECONOMY, AND THEY SAID, SO FAR, THE WEAKNESS IS CONTAINED TO HOUSING, THEN THE WHOLE WORLD BLEW UP. WHEN THINGS START TURNING DOWN, YOU WONDER WHAT’S GOING ON. I WOULD SAY IT’S ODD WITH MANUFACTURING AND INDUSTRIAL PRODUTION OUT THERE. THIS IS THE SECOND TIME IN THE LAST 10 YEARS WHERE PRODUCTION LEVELS HAVE FALLEN. IN 2014, 2015, 2016, THEY ROSE BACK, COINCIDENTLY WHEN TRUMP TOOK OFFICE. NOW, IT’S COME BACK DOWN. THE REASON THAT’S IMPORTANT IS THAT IT IS NEVER REALLY FALLING EXCEPT IN A RECESSION. IT’S ONE OF THE PRIMARY INDICATORS, BELIEVE IT OR NOT. ONLY 10 PERCENT OF U.S. JOBS OR PRIVATE JOBS ARE IN MANUFACTURING. THAT STATISTIC PRETTY MUCH TELLS YOU THE BEST DAY FOR YOUR ECONOMY, AND THEN GOING INTO RECESSION, THE WORST DAY OF THE ECONOMY. ANY TIME IT TURNS DOWN, I WOULD WONDER AND SCRATCH MY HEAD WHAT’S GOING ON. IN THE OLD DAYS, IN JAPAN, MANUFACTURING IN JAPAN WAS AN IMPORTANT INDICATOR. IT STOPPED BEING AN INDICATOR WHEN THEY SHIPPED OVERSEAS. IT’S A PRIMARY DEFINITION OF THE RECESSION >>CONNECT THE DOTS TO THE OVERALL ECONOMY. WE’VE HEARD PRESIDENT TRUMP SPEAK THIS AFTERNOON. EVEN WHEN YOU LISTEN TO HIM ABOUT THE ECONOMY, EVERYTHING IS GREAT, BUT MAYBE WE NEED TAX CUTS, A ONE PERCENT CUT FROM THE FED. SO, IT’S HARD TO SAY WHETHER OR NOT HE THINKS THE ECONOMY IS GOOD, BUT WHAT DO YOU THINK OVERALL? >>I KEEP WATCHING MY SHOULDER FOR THE TWEETS. I DON’T REMEMBER ANY PRESIDENT IN HISTORY WHO WAS THIS MINDFUL OF THE LATEST ECONOMIC STATISTICS. SOMETIMES, IT’S WAY OFF, BUT SOMETIMES, HE HIT SOME ON THE HEAD OF THE NAIL. >>THAT’S SORT OF THE PROBLEM, RIGHT? >>YEAH. OKAY, SO YOU CAN KNOW WHAT THE STATISTICS ARE DOING, BUT WHAT IS THE SENSE OF IT? WHAT IS THE IMPORTANCE OF IT? I GUESS, UNFORTUNATELY, SINCE THE YIELD CURVE BRIEFLY INVERTED FROM TWO YEARS TO 10 YEARS LAST WEDNESDAY MORNING, IT GOT EVERYONE THINKING THE RECESSION IS SIGNALED, EVEN THOUGH WE HAD THE THREE-MONTH BILLS TO THE 10-YEAR NOTE, IT INVERTED IN JUNE SIGNALING A RECESSION AS MUCH AS YOU ARE GOING TO GET ONE. THIS ONE WENT IN. THE STOCKS WENT DOWN 800 POINTS. TRUMP SEIZED ON THAT. I DON’T KNOW. I GUESS, BECAUSE THERE IS TALK OF RECESSION, THE TRUMP ADMINISTRATION ECONOMICS TEAM IS LOOKING FOR WHAT COULD WE DO IF THERE WERE A RECESSION, SO THEY TROTTED OUT THE PAYROLL TAX CUT LIKE WE GOT BACK IN 2011 AND 2012. IT CUT PAYROLL TAXES AND ADDED ABOUT $120 BILLION TO THE ECONOMY. WE COULDN’T SEE ANY NOTICEABLE EFFECT IN CONSUMER SPENDING BACK THEN. IT WAS ALWAYS A BIT OF A MYSTERY BACK THEN, BUT THEY ARE JUST PREPARING IN CASE SOMETHING HAPPENS. >>SOMETHING TO DO OR SOMEONE TO BLAME. THANK YOU FOR JOINING US. >>>UP NEXT, ROGER FEDERER, SERENA WILLIAMS, THE U.S. OPEN TENNIS TOURNAMENT DISSENTS ON NEW YORK CITY. WE HAD TO ICONIC ARTHUR ASHE STADIUM IN FLUSHING, NEW YORK, FOR A LOOK AT ALL THE ACTION WITH MORE THAN $57 MILLION IN PRIZE MONEY UP FOR GRABS. >>>BEFORE WE GO, A QUICK REMINDER. YAHOO FINANCE MARKET SUMMIT WITH GENERATIONAL OPPORTUNITIES HELD IN NEW YORK CITY ON SEPTEMBER 10, BRINGING TOGETHER THE BIGGEST LEADERS IN GOVERNMENT. MORE DETAILS ON THE GUEST LINE UP AND HOW YOU CAN GET YOUR TICKETS. GO TO WWW.YAHOOFINANCEAMS.COM. >>>TENNIS FANS ARE DESCENDING ON NEW YORK CITY FOR ONE OF THE BIGGEST EVENTS OF THE YEAR. THAT IS THE U.S. OPEN TENNIS TOURNAMENT. YAHOO FINANCE’S BRIAN SOZZI IS LIVE FROM THE ICONIC ARTHUR ASHE STADIUM IN FLUSHING. WE ARE HEARING TICKET SALES ARE THROUGH THE ROOF THIS YEAR. >>TICKET SALES ARE DOING PRETTY WELL. TO BE HONEST, JUST ENTERING RECESSION TALK, I WAS JUST 10 DEEP IN A POKE BOWL LINE. THEY ARE NOT CHEAP. $15 EIBEL. IF WE PUT THE RECESSION QUESTION TO THE CHIEF REVENUE OFFICER OF THE USTA, HE SAYS TICKET SALES ARE STRONG. OVER THE PAST TWO WEEKS, SALES WILL PROBABLY OUTPACE RECORDS THAT LAST YEAR, BUT I DIDN’T WANT TO TALK ABOUT RECESSION. I ALSO ASKED HIM ABOUT HOW THEY ARE TRYING TO GROW THE NEXT GENERATION OF TALENT IN THE TENNIS INDUSTRY. >>WE ARE STILL SEE A LOT OF BIG NAMES. A LOT OF THE AGING VETERANS STILL PLAYING GOOD. HOW IS IT IMPORTANT FOR THOSE NAMES TO STILL PLAY WELL? >>IT HAS BEEN A HUGE BOON FOR US TO HAVE PLAYERS LIKE FEDERER, NADAL, JOKAVICH PLAYING WELL INTO THEIR LATE 30s, AND SERENA WILLIAMS, VENUS WILLIAMS ON THE WOMEN’S SIDE. FANS KNOW THOSE PLAYERS. THEY ARE ATTACHED TO THOSE PLAYERS. THEY WANT TO WATCH THOSE PLAYERS PLAY. THERE IS A NEW CROP OF PLAYERS COMING UP THAT HAVE THE OPPORTUNITY TO TEST THEMSELVES AGAINST THE GREATEST OF ALL TIME. WE HAVE A GOLDEN AGE IN THIS SPORT. >>Reporter: TWO NAMES STAND OUT TO ME. COCO GAUFF AND NAOMI SOFT. HOW IMPORTANT IS IT TO HAVE THOSE TALENTS? >>TALK ABOUT NEW AND ASCENDING. COCO GAUFF, 15 YEARS OLD, DOING INCREDIBLE THINGS AT FUMBLE 10, AND HOPEFULLY INCREDIBLE THINGS HERE AT THE U.S. OPEN. A HUGE TALENT LOOKING TOWARD THE FUTURE, AND A REASON FOR A LOT OF TENNIS FANS TO BE EXCITED ABOUT THE NEXT GENERATION OF GREATS. NAOMI OSAKA DID A GREAT JOB LAST YEAR. SHE HAS WON ANOTHER SLAM SINCE THEN, AND IS ALSO A JAPANESE PLAYER THAT HAS IGNITED INTEREST IN THE SPORT THROUGHOUT ASIA. WE ARE A GLOBAL EVENT. THAT’S A HUGE HELP. ú>>Reporte TO DRIVE THE NEXT GENERATION OF PLAYERS? THE NUMBERS HAVE BEEN STAGNANT, BUT HOW ARE YOU GETTING THAT NEXT CROP IN? >>GREAT QUESTION. AS AN ORGANIZATION, WE ARE A NONPROFIT. WE ARE MISSION FOCUSED. OUR JOB IS TO GROW THE GAME, AND MAKE SURE THE GAME LOOKS LIKE IT DOES FROM A PARTICIPANT STANDPOINT. A BAKE SALE FUNDS ALL OF THOSE GRASSROOTS EFFORTS TO TRY TO BRING MORE PLAYERS INTO THE SPORT. IT’S NOT BECAUSE WE HAVE A STAKE IN CONSTRUCTION, OR BALL AND BRACKET SALES, IT’S THE BELIEF THAT TENNIS IS A GREAT WAY TO IMPROVE THE QUALITY OF SOMEONE’S LIFE, AND QUALITY OF LIFE IN THE COUNTRY. WE INVEST TENS OF MILLIONS OF DOLLARS BACK INTO THE GRASSROOTS TO ATTRACT MORE PLAYERS INTO THE GAME. WE HAVE A PLATFORM CALLED NET GENERATION, WHICH IS THE UMBRELLA WE USE TO ATTACH ALL OF OUR 18 AND UNDER YOUTH PROGRAMS, OUR MARKETING PLATFORM, OUR PLAY FORMAT, DIGITAL OUTREACH, CHILD ENGAGEMENT, AND WE ARE STARTING TO SEE THOSE RESULTS THIS YEAR. PARTICIPATION HAS BEEN UP, AND WE EXPECT THAT TO CONTINUE, BUCKING THE TREND IN THE U.S. WHERE YOUTH PARTICIPATION IN SPORTS HAS BEEN DECLINING FOR A DECADE. >>Reporter: HOW DID THEY SAY IT BACK IN THE DAY? THE CHILDREN ARE OUR FUTURE? THAT IS WHAT USTA IS TRYING TO DO, TO GET MORE CHILDREN IN THE GAME. IT’S AN EXPENSIVE SPORT. THE RACKETS ARE COSTLY. THE BALLS ARE COSTLY. BUT, THEY ARE TRYING TO GO TO THE GAME. >>IT’S INTERESTING. YOU HAD ME THINKING, BOTH SPORTS RIGHT NOW ARE STILL KIND OF DEALING WITH STARS THAT WERE BIG STARS 15 YEARS AGO, AND THEY HAVEN’T REALLY FOUND THE NEXT GENERATION OF PEOPLE TO PUSH THE GAME FORWARD. >>Reporter: ROGER FEDERER IS 37 YEARS OLD. BY ALL ACCOUNTS, HE REMAINS AT THE TOP OF HIS GAME, BUT A LOT OF BIG NAMES IN TENNIS LIKE SERENA WILLIAMS, GETTING UP THERE IN AGE. THE STANDOUTS ARE NAOMI OSAKA AND COCO GAUFF, WHO IS 15 YEARS OLD AND TAKEN THE SPORT BY STORM. SHE GOT A WILDCARD TO THIS EVENT. >>TARGET EARNINGS TOMORROW. DON’T FORGET. I WILL SEE YOU ON THE FIRST TRADE. >>>UP NEXT, JPMORGAN’S RATING BUREAU SAYS DON’T WORRY, IT’S NOT THE FUNDAMENTALS THAT ARE CAUSING ALL OF THIS MARKET FRENZY, SO WHAT’S BEHIND RECENT VOLATILITY? WE WILL HEAD TO THE FLOOR OF THE CME TO BREAKDOWN THE TECHNICALS. >>>THIS IS THE FINAL ROUND. THE DOW, LOOKING TO SNAP A THREE-DAY WINNING STREAK. MORE ON THE ACTION IN JUST A BIT. >>>PLUS, RESULTS FROM FACEBOOK’S CONSERVATIVE BIAS AUDIT ARE IN. WE WILL LOOK UNDER THE HOOD. AND ONE ANALYST, FINALLY úTURNI YEAR’S HOTTEST IPOs. I BET YOU CAN GUESS WHICH ONE. >>>PLUS, WHO IS THE KING OF THE CHICKEN SANDWICH? WE ARE GOING TO GIVE YOU THE WINNER OF THE MOST EPIC FOOD FIGHT. I WOULD SAY ON WALL STREET, BUT JUST THE INTERNET. THE MOST EPIC FOOD FIGHT YOU WILL FIND ANYWHERE. JOINING ME NOW, MY CO-HOST JEN ROGERS. WITH 27 MINUTES TO GO, LET’S TAKE A LOOK AT WHERE THE MARKETS ARE OUT. ALL THREE MAJORS ARE IN THE READ. WE ARE MOVING OFF LEVELS. SOME MORE DEPRESSING LEVELS, WE SAW EARLIER. THE DOW OFF 87 POINTS. THE NASDAQ OFF ABOUT FOUR TENTS. THE S&P OFF A HALF OF ONE PERCENT. NOTHING TOO REMARKABLE IN TODAY’S TRADING SESSION. WE WERE DISCUSSING EARLIER, THE MARKET IS LOWER WITH YIELDS, LOWER, SO NOT A FULL DECOUPLING OF THE TREND WE’VE SEEN, BUT NOT QUITE THE VIOLENT MOVE IN STOCKS THAT SIX BASIS POINTS IN THE 10-YEAR MAY HAVE CAUSED LAST WEEK. >>CERTAINLY, THE FORCE IS NOT THERE WITH THIS MOVE, AND WE HAVE COME BACK FROM SOME OF THE LOWS OF THE SESSION. HOME DEPOT, JUST SCREAMING OUT AT ME. IT’S IN A SEA OF RED. HOME DEPOT, NICE HERE. IN THE RETAIL SPACE, A 52-WEEK LOW FOR MACY’S. JUST A TEASE AHEAD TO OUR FOOD FIGHT. WENDY’S, 52-WEEK HIGH. >>THE CONSUMER WINS AGAIN. AS LONG AS YOU ARE NOT A DEPARTMENT STORE. >>>LESS THAN 30 MINUTES TO GO IN TODAY’S TRADING SESSION. SCOTT GAMM IS BACK ON THE FLOOR OF THE NEW YORK STOCK EXCHANGE. WHAT ARE YOU WATCHING HEADING INTO THE CLOSE RIGHT NOW? >>WE’VE GOT ABOUT A HALF HOUR LEFT IN THE TRADING SESSION AND WE ARE NEAR TWO IMPORTANT TECHNICAL LEVELS. THAT’S 2900 AND THE S&P. 2900 IN THE S&P 500, AND 26,000 IN THE DOW. WE ARE ABOUT THOSE THRESHOLDS RIGHT NOW, BUT WE WILL SEE IF WE CAN CLOSE ABOVE THOSE LEVELS IN THE NEXT 20 MINUTES OR SO. IT COULD BE A NAIL-BITER, ALTHOUGH IT LOOKS TO BE AS THOUGH WE WILL CLOSE ABOVE THOSE NUMBERS. THAT’S TWO IMPORTANT, TECHNICAL INDICATORS TRADERS ARE WATCHING DOWN HERE. AS YOU MENTIONED, THE STOCK MARKET IS STILL TIED TO BOND YIELDS. TREASURY YIELDS ABOUT 1.55 PERCENT. YESTERDAY, 1.6 PERCENT, BUT YOU COULD ARGUE THAT THE STOCK MARKET IS GETTING USED TO LOWER YELDS BECAUSE YIELDS ARE DOWN TODAY, AND YET THE DOW IS ONLY DOWN ABOUT 100 POINTS. SPEAKING OF THE DOW, I AM NOT REALLY WATCHING THE LEADERS AND BLOGGERS OF THE SESSION. I WILL BRING YOU THOSE AT 4:00 P.M., BUT FOR NOW, I AM WATCHING SOME OF THE STOCKS WITH LARGER WEIGHT IN THE DOW THAT ARE NOT DOING MUCH TODAY. THOSE WOULD BE APPLE, WHICH IS UP SLIGHTLY, BUT IT’S ACTUALLY AT THE LOW OF THE SESSION. BOEING IS DOWN TODAY, BUT NEAR SESSION HIGHS, AND THEN MICROSOFT IS DOWN TODAY, NEAR SESSION LOWS. THE POINT IS, EVEN SMALL MOVEMENTS IN THESE THREE STOCKS IN THE NEXT 20 MINUTES OR SO, COULD HAVE A SIGNIFICANT IMPACT ON WHERE THE DOW CLOSES FOR THE DAY, AND WHETHER OR NOT THE DOW CAN CLOSE ABOVE THE 26,000 LEVEL. BEFORE WE GO, I WANTED TO POINT OUT BOLD GOLD PRICES, WHICH REMAIN ABOVE $1500 AN OUNCE, EVEN AS THE BROADER MARKET HAS MOSTLY BEEN ABLE TO RECOVER FROM THOSE STEEP DECLINES THAT WE SAW LAST WEEK, SO THAT TELLS YOU, EVEN THOUGH THE MARKET HAS RECOVERED, THERE ARE STILL A SIGNIFICANT NUMBER OF INVESTORS STICKING WITH GOLD. THEY ARE NOT NECESSARILY SELLING GOLD TO BUY STOCKS. THEY ARE MAINTAINING THEIR POSITION, HENCE THE RELATIVE STABILITY IN GOLD PRICES OVER THE LAST TWO WEEKS OR SO. >>WE WILL TALK TO YOU AFTER THE BELL. >>>STOCKS ARE LOWER TODAY, ALTHOUGH A LITTLE CALMER AFTER THE VOLATILITY THAT WE SAW LAST WEEK. JOINING US TO DISCUSS IS THE PRESIDENT OF BLUE LINE FEATURES. WHEN YOU LOOK AT THE MARKET RIGHT NOW, TAKING A LAY OF THE LAND, WHAT WE’VE SEEN OVER THE LAST COUPLE OF DAYS, WHERE DO YOU SEE THINGS SHAKING OUT? DOES IT FEEL LIKE THAT PERIOD OF VOLATILITY IS STARTING TO CALM DOWN? >>Reporter: FOR MAYBE 24 MORE HOURS, BUT ULTIMATELY WE GET THE SAID MINUTES TOMORROW, JACKSON HOLE KICKING IN, AND THE FED SHARE TOMORROW. THIS WAS EXPECTED TO BE MORE OF A SLOWER GRIND MONDAY AND TUESDAY, FIRST HALF OF WEDNESDAY, BUT AT THE SAME TIME, THE S&P, THE NASDAQ, BOTH REACHING CRUCIAL LEVELS OF RESISTANCE. IT’S NOT SURPRISING TO SEE THEM CONSOLIDATE AHEAD OF SOME OF THESE MAJOR EVENTS IN THE BACK HALF OF THE WEEK. >>WHEN YOU LOOK AT THE STOCK MARKET, WE HAVE TALKED ABOUT THE IDEA THAT IT CONTINUES TO BE DRIVEN BY ACTION IN THE TREASURY MARKET. IS THAT WHAT YOU SEE, AS WELL? DO YOU THINK WE NEED TO SEE SOME RESOLUTION ON THAT? IT DOESN’T SEEM SUSTAINABLE THAT STOCKS CAN FOLLOW BONDS TAKE FOR TAKE FOR MONTHS ON END.>>Reporter: I ULTIMATELY THINK THAT IF WE START TO SEE SOME BETTER DATA, PARTICULARLY HERE IN THE U.S., WE WILL START TO SEE BETTER DATA. I THINK WE ARE TURNING A CORNER. SOME STRONGER INFLATION ISN’T THE GREATEST, BUT RETAIL SALES, EMPIRE STATE MANUFACTURING LAST WEEK, CONSUMER SENTIMENT HAS BEEN STRONG. MAYBE, NOT MICHIGAN NUMBERS. WE SEE THAT AND BETTER PMI’S THIS WEEK, POTENTIALLY WITH LESS DOVE. IT MAY NOT HAPPEN ALL AT ONCE, BUT IT WILL TAKE TIME TO MAKE A TRANSITION FROM DEPENDING ON A MORE DOVISH OUTLOOK TO BETTER DATA HERE IN THE U.S. THE TRANSITION WON’T HAPPEN AT ONCE, BUT I THINK WE WILL SEE IT HEADING INTO THE FED MEETING IN SEPTEMBER. >>>IT’S NOT THAT OFTEN THAT A REPORTER FROM THE NEW YORK STOCK EXCHANGE ENDS HIS REPORT TALKING ABOUT GOLD, BUT I THINK IT’S CONSTRUCTIVE FOR WHAT’S HAPPENING RIGHT NOW IN THE MARKET. GOLD, RIGHT NOW, ABOVE $1500 AN OUNCE. YOU POINT OUT IT WAS ABLE TO HOLD ABOVE A MAJOR THREE-STAR SUPPORT LEVEL, AROUND $14.84. TALK TO ME ABOUT WHAT YOU ARE PAYING ATTENTION TO, AND FOR YOUR BIAS IS IN GOLD, RIGHT NOW. >>Reporter: I NOTICED THAT IN THE CLOSE OF LAST SEGMENT. I THINK GOLD IS STRONG AND HAS HAD A TREMENDOUS RUN. YOU HAD TO BE BULLISH INTERMEDIATE AND LONG-TERM. THE PATH OF LEAST RESISTANCE IS HIGHER. EVERY TIME IT HAS FALLEN BACK, BUYERS HAVE STEPPED IN TO KEEP THE MOMENTUM UP. IT RECOVERED TODAY, TOO. A HEADWIND COULD BE IF THE TREASURY YIELD RECOVERS A LITTLE BIT. LOW TREASURY YIELDS ARE NEGATIVE, AND ZERO THROUGHOUT THE WORLD. $17 TRILLION IN NEGATIVE DEBT AROUND THE WORLD. NOW, YOU ARE SEEING A BIT OF RENEWED BUYING DUE TO THE POTENTIAL YIELD CURVE INVERSION THAT HAPPENED AND IS FLIRTING WITH THOSE NUMBERS, BUT I LIKE HEDGING GOLD WITH POINTS IN THE TREASURIES. I THINK THE TREASURY MARKET COME IN. YOU ARE STARTING TO SEE THE COMMITMENT OF TRADERS GOING TO THE LONG SIDE OF LEVERAGE, BUT, ULTIMATELY, U.S. GOLD CONSOLIDATES. IT’S THE TREASURIES YOU’VE GOT TO WATCH, AND THE U.S. DOLLAR. THE U.S. DOLLAR INDEX, MORE PARTICULARLY, ISN’T OUT ABOVE THE PREVIOUS HIGHS OF THE YEAR. IT’S FLIRTING THERE. THE SAME WITH THE EURO. IT’S AT ITS LOWS FOR THE YEAR. IF WE SEE A DIRECTIONAL MOVE WITH THE EURO HIGHER, BUT WITH YIELDS THEMSELVES NOT GOING LOWER, THEN IT’S NOT GOING TO BE A GREAT LANDSCAPE FOR GOLD. IT’S JUST NEAR TERM, SO IF IT GOES BELOW $14.84, YOU WILL SEE CONTINUED SELLING. >>PRESIDENT OF BLUE LINE FUTURES. THANK YOU FOR JOINING US. >>>UP NEXT, MOVE OVER, NETFLIX AND DISNEY. APPLE IS THROWING AROUND BIG BOX AS IT TRIES ITS HAND AT THE STREAMING VIDEO CRAZE. BUT IS $6 BILLION ENOUGH TO WIN THE STREAMING WARS? WE DISCUSSED. >>>YAHOO FINANCE IS LAUNCHING A NEW PODCAST SERIES CALLED “THE ART OF THE EXIT.” IF A TRUE CRIME PODCAST THAT TAKES YOU INSIDE THE WORLD’S MOST NOTORIOUS HEISTS. THE NEW SERIES BEGINS TODAY WITH NEW EPISODES EVERY TUESDAY THROUGH NOVEMBER. LISTEN TO “THE ART OF THE EXIT” ON APPLE PODCASTS OR WHEREVER YOU GET YOUR PODCASTS. WE WILL BE RIGHT BACK. >>>DISNEY WILL HAVE SOME STIFF COMPETITION IN THE STREAMING WORLD THIS FALL. APPLE IS REPORTEDLY AIMING TO LAUNCH THE APPLE TV PLUS SERVICE IN NOVEMBER. THE SUBSCRIPTION VIDEO SERVICE WILL COME OUT RIGHT AROUND THE TIME THE DISNEY PLUS DEBUT DOES. WE HAVE TECH EDITOR DAN HOWLEY. THIS IS LIKE WHEN THEY DO TWO MOVIES ABOUT ACHILLES AT THE SAME TIME, AND YOU ARE LIKE WHY DID THEY DO THEM AT THE EXACT SAME TIME? IT HAPPENS ALL THE TIME. >>COME ON, HOLLYWOOD. COULDN’T YOU HAVE DONE THIS DIFFERENTLY? I GUESS THE HEADLINE EVERYONE HAS BEEN TALKING ABOUT IS APPLE IS GOING TO BE SPENDING, REPORTEDLY, ABOUT $6 BILLION, WHICH IS A LOT MORE THAN THEY TOLD US BEFORE. IT’S A TON OF MONEY. MONEY CERTAINLY WINS WHEN IT COMES TO CONTENT, BUT IT IS SO EASY TO SPEND MONEY. DO YOU JUST GET GOOD SHOWS? >>NETFLIX — I WOULD SAY THEY ARE BATTING LIKE .125, MAYBE. THEY ARE NOT REALLY BATTING THOUSAND. BUT THEY DO HAVE TO DUMP A LOT OF MONEY TO GET THE CONTENT THEY HAVE, WHICH INCLUDES GETTING THINGS LIKE THE ADAM SANDLER MOVIES, WHICH AS WE ALL — SOMEHOW, DOES AMAZINGLY WELL FOR RATINGS, BUT MAY NOT BE THE BEST SHOW EVER. APPLE, WE’VE SEEN THE MORNING SHOW THEY HAVE COMING WITH STEVE CARELL. THAT’S THE MAIN TRAILER WE’VE SEEN. WHEN THEY ANNOUNCED THIS IN MARCH, THEY HAD A NUMBER OF SHOWS LINED UP. THEY HAD SOMETHING WITH OPRAH, SOMETHING WITH JASON MOMOA. THEY HAD ALL THESE DIFFERENT PEOPLE COMING OUT ON STAGE. WE HAVEN’T SEEN ANYTHING BEYOND THIS QUITE YET. I THINK IF I’M GOING BETWEEN ONE OR THE OTHER, I AM LEANING TOWARDS DISNEY JUST BECAUSE I GET UNLIMITED SIMPSONS FOR SIX DOLLARS A MONTH. ON TOP OF THAT, I GET STAR WARS, MARVEL, NATIONAL GEOGRAPHIC. THEY REALLY DO HAVE, I THINK, THE BEST OFFERING OUT THERE. IT’S GOING TO TAKE A LOT FOR APPLE TO REALLY SELL PEOPLE FOR $9.99 A MONTH ON SOMETHING THEY DON’T KNOW WHAT THEY ARE GOING TO GET RIGHT AWAY. IT’S NOT THAT FAR OFF. ALL WE HAVE SEEN IS THE MORNING SHOW. GET ME EXCITED. SHOW THAT SPIELBERG SHOW HE WAS PUSHING. THE MYSTERIES SHOW. GIVE ME SOMETHING EXCITING. STEPHEN SPIELBERG HAS A PROVEN TRACK RECORD OF MAKING TELEVISION SHOWS. APPLE HAS LITERALLY NO EXPERTISE IN THIS AREA. THEY ARE JUST TROTTING OUT FAMOUS PEOPLE. >>HERE IS MY REACTION. >>WITH ALL DUE RESPECT, JENNIFER ANISTON HASN’T MADE A RELEVANT PIECE OF CONTENT IN 10 YEARS. >>NOR HAS STEVE CARELL OUTSIDE OF “THE OFFICE.” >>I LIKED THAT MOVIE LAST CHRISTMAS WITH THE DAUGHTER AND THE BEAUTY PAGEANT. >>REESE WITHERSPOON HAS “BIG LITTLE EYES.” >>WHEN NETFLIX HAS A BATTING AVERAGE TO MAKE AS MUCH AS POSSIBLE WITH THE COST DOWN, NOW THEY ARE DOING THE BIG- TICKET STUFF, BUT THEY’VE TRIED TO KEEP EVERYTHING CHEAP, SO IF IT DOESN’T WORK, MOVE ON. >>MY THEORY ABOUT APPLE IS EVERYBODY IS LOOKING AT THIS, SAYING IT’S NOT GOING TO PAY OFF, BUT LOOK WHAT THEY DID WITH APPLE MUSIC. EVERYONE WAS LIKE APPLE MUSIC? WHY? iTUNES, SPOTIFY. NOW, APPLE MUSIC HAS MORE PAID SUBSCRIBERS. >>BECAUSE THEY GIVE IT AWAY. >>THEY DO. THEY WILL DO THAT WITH THIS. $9.99 IS A LITTLE RICH OUT OF THE GATE. >>TALKING ABOUT BATTING AVERAGES WITH HULU AND AMAZON, YOU JUST NEED ONE. >>”HANDMAID’S TALE AGO AND “MARVELOUS MRS. MABEL.” >>FOR YEARS, THEY’VE DONE WELL WITH A PRETTY LIMITED LINE UP. WE WILL SEE. MONEY TALKS. >>>NOW, TO FACEBOOK. AFTER MONTHS OF WAITING, THE COMPANY FINALLY RELEASED ITS REPORT ON CONSERVATIVE BIAS. THERE IS A LOT TO UNPACK IN ALL OF THIS. WHAT IS THE BIGGEST TAKE AWAY? >>THERE WAS NO BIAS. THERE IS NO BIAS. THERE WAS NONE. THE MAIN CHANGE THEY ARE MAKING IS SOMETHING TO ADD, WHERE THEY CAN SHOW TUBES INSIDE OF PEOPLE. THAT’S FOR PRO-LIFE STUFF, BUT THEY CAN’T SHOW ANY KIND OF REAL VISCERA OR ANYTHING LIKE THAT. THAT’S THE GIST OF IT. THE “WALL STREET JOURNAL” HAD THE OPINION PIECE WHO HAD DONE THIS. IT WAS BASICALLY LIKE, OKAY, WE DID THIS STUDY. FACEBOOK GAVE US FREE REIGN. WE DIDN’T REALLY FIND ANYTHING. >>IT’S NOT OVER. >>RIGHT. FACEBOOK HAD THESE PLANS THEY HAD ALREADY ANNOUNCED. SOMEHOW, THAT MEANS WE WON, AND THE “NEW YORK TIMES” WAS CALLED OUT FOR SOME REASON AT THE BEGINNING. >>IT’S VERY LIGHT ON NUMBERS. VERY HEAVY ON ANECDOTES AND FEELINGS. >>CONSERVATIVE TAKES, CONSERVATIVE VIEWPOINTS, ARE THE MAIN CURRENCY OF INTERNET COMMENTARY. THE MAIN THING YOU SEE ON THE INTERNET IS CONSERVATIVE TAKES, BUT FACEBOOK, OF COURSE, IS JUST THE LATEST BIG COMPANY TO FALL FOR THE TRAP OF WE NEED MORE CONSERVATIVE VOICES, SO THEY HIRED NEOLIBERAL NICK CLEGG AND REPUBLICAN SENATOR JOHN KYLE TO SEE WHAT HAPPENS. IS WHAT? THEY FOUND SOME THINGS THAT MADE THEM UNHAPPY. WHATEVER. FACEBOOK OBVIOUSLY HAS NO IDEA WHAT IT’S DOING IN THE MEDIA SPACE., OF COURSE, REPORTING THEY WILL HIRE JOURNALISTS ONCE AGAIN TO TRY TO FIGURE OUT THE NEWS TAB. THE COMPANY CLEARLY NEEDS TO MAKE SOME RULING ON WHAT IS ON THEIR PAGES, BUT THEY DON’T WANT TO DO THAT BECAUSE THAT’S HARD AND MARK ZUCKERBERG DOESN’T KNOW WHAT THE ANSWER IS. IT’S NOT A ZERO MINUS ONE ANSWER, WHICH IS THE ONLY WAY HE SEES THE WORLD. >>THIS IS SOMETHING OUR EDITOR IN CHIEF AND I HAVE TALKED ABOUT BEFORE. HOW THESE COMPANIES REFUSE TO TAKE RESPONSIBILITY FOR WHAT IS ON THEIR WEBSITES. YES, WE HAVE LEGISLATION THAT MEANS PEOPLE CAN POST THINGS, AND YOU DON’T GET IN TROUBLE BECAUSE YOU ARE THE COMPANY THAT HOSTS IT, BUT THAT DOESN’T MEAN YOU CAN’T TAKE IT DOWN. I THINK, IF THEY FEEL IT’S THEIR SITE, AND THERE IS SOMETHING THEY DISAGREE WITH, THEY SHOULD HAVE FREE REIGN TO TAKE IT DOWN. THIS IS A PUBLIC COMPANY, BUT IT’S A BUSINESS. THAT IS SOMETHING WE ARE ALWAYS TALKING ABOUT, KEEP GOVERNMENT OUT OF BUSINESS, BUT THIS SEEMS LIKE GOVERNMENT TRYING TO FORCE ITS WAY INTO BUSINESS WHEN IT DOESN’T LIKE IT. >>FACEBOOK ALONG WITH OTHERS ARE SAYING WE WOULD RATHER BUSINESSES AND THE GOVERNMENT MAKE DECISIONS. I DON’T KNOW IF IT’S A ROAD WE WANT, BUT WE ARE GOING DOWN IT. >>IT’S MARK ZUCKERBERG’S TAKE ON THE NEW WORLD. >>HE STUDIED CLASSICS AT HARVARD BEFORE HE DROPPED OUT. >>ARE PARTICULARLY THINK ABOUT THE PART ABOUT DEFINING HATE SPEECH IS INTERESTING. ANYHOW, READ IT. WE WILL TALK TO YOU TOMORROW. >>>COMING UP ON THE FINAL ROUND, THE CLOSING BELL IS ABOUT NINE MINUTES AWAY, BUT FIRST, WE WILL GET TECHNICAL WITH OUR FAVORITE TOYS HERE AT YAHOO FINANCE. THAT IS THE WI-FI INTERACTION TOUCHSCREEN. WE ARE BACK IN JUST A COUPLE OF MINUTES. >>>STOCKS DRIFTING LOWER ON A SUMMER DAY. JARED WICK WAY IS HERE AT THE INTERACTIVE TOUCH SCREEN. WE ARE ABOVE 26,000. >>SCORE ONE FOR THE BULLS. AND FEELS LIKE SUMMER. NOT A LOT OF ACTION IN EQUITIES. WE WILL TAKE A LOOK AT BONDS IN A MINUTE. HERE IS THE INTRADAY PRICE ACTION. WE SAW STOCKS DRIFTING INTO THE UNCHANGED AREA, AND THEN LOWER. WE HAD PRESIDENT TRUMP TALKING AFTER 2:00 P.M. TO THE REPORTER POOL, NOT MOVING THE MARKET MUCH. WE HAVEN’T SEEN ANYTHING THIS LOW SINCE THE BEGINNING OF THE DAY. THE BOND MARKET HAS BEEN DRIVING THINGS. THE 10-YEAR KEYNOTE BUILD IS DOWN BY SIX BASIS POINTS. IN AUGUST, IT WAS DOWN ABOUT 44 BASIS POINTS, WHICH IS HUGE. WE HAVEN’T SEEN THAT IN A NUMBER OF YEARS. THE QUESTION IS, WHAT’S GOING TO HAPPEN WHEN THE NEXT BIG BOND MOVE HAPPENS? JPMORGAN IS OUT WITH A NEW NOTE THAT SAYS GIVEN THE OUTPERFORMANCE OF BONDS, UP ABOUT SIX PERCENT VERSUS EQUITIES DOWN TWO PERCENT IN AUGUST TOWARD NEXT WEEK, WE COULD SEE A FLOOR UNDER MARKETS WITH A ROTATION OUT OF BONDS TO EQUITIES. THAT COULD SOFTEN THE BLOW IF WE TURN SOUTH IN THE MARKET, BUT THE STOCKS ARE AT A CRITICAL LEVEL. >>YIELDS AND STOCKS ARE LOWER. LET’S TALK ABOUT TRANSPORTS. COMING UP, A COUPLE TIMES TODAY, WHY ARE PEOPLE WATCHING SO CLOSELY? >>THERE IS A LONGER TERM PATTERN OF PLAY. LET’S GO BACK FIVE YEARS. WE CAN SEE THE UPTREND WAS BROKEN, BUT WE WILL ESSENTIALLY GO BACK MAX. LET’S GO TO THE 1930s. WE ARE GOING TO GO BACK TO A FIVE YEAR, BUT WE CAN SEE A CONSOLIDATION WEDGE FORMING. AS IT GOES IN AND OUT, IT COULD SET UP FOR A BIG MOVE. IF TRANSPORTS BREAKOUT TO THE UPSIDE, THAT WOULD BE BULLISH FOR THE MARKET. WE’VE TALKED ABOUT DOW THEORY, ALL THESE THINGS, BUT IF THEY BREAK TO THE DOWNSIDE, THAT’S GOING TO BE ANOTHER BEARISH FACTOR FOR THE MARKETS. >>I’VE BEEN ASKING EVERYONE ABOUT GOLD TODAY. SCOTT GAMM POINTED OUT IT’S ABOUT 1500. STABILITY, REALLY IN GOLD. >>IT IS ABOUT 1500. LET’S GO BACK TO A TWO-PACK A MONTH CHART TO SEE MORE GRANULARITY. WE CAN SEE IT IS BOUNCING OFF THE SUPPORT LEVEL. IT HIT 1500 YESTERDAY, BUT PRETTY IMPRESSIVE MAINTENANCE ON THIS MOVE, ESPECIALLY BECAUSE THE U.S. DOLLAR IS HEADING OUR WAY. USUALLY, COMMODITIES MOVE IN THE OPPOSITE DIRECTION BECAUSE THEY ARE PRICED IN DOLLARS BUT DESPITE THE PRICE, GOLD IS HANGING ON, REALLY JUST ANTICIPATING A BUNCH OF BAZOOKAS COMING UP FROM THE ECB AND THE FED. MAYBE, TRUMP WILL GET HIS 100 BEATS, AND IT WILL COME IN BEFORE THE ELECTION, BUT GOLD IS ACTING AS A SAFE HAVEN. I LIKED BILL’S SUPPORT FOR 1085. AS LONG AS IT MAINTAINS THAT, WE ARE IN GOOD SHAPE FOR GOLD. >>JARED McCURRY WITH YFi INTERACTIVE. >>> BEYOND MEAT STOCKS SURGED TODAY AS ONE WALL STREET ANALYST FINALLY GIVES IT THAT I RATING. IT’S OUR CALL OF THE DAY RIGHT AFTER THIS. JOINING US NOW IS FRANK REED, CEO AND COFOUNDER OF >>>CARS, BIKES, SCOOTERS, AND NOW ELECTRIC MOPEDS. THE LATEST SHARED MOBILITY PLAY IS REBEL, WHICH HAS A FLEET OF ELECTRIC MOPEDS IN BROOKLYN, AND IN QUEENS. JOINING US NOW IS FRANK REED, CEO AND COFOUNDER OF REBEL. REBEL WAS JUST GRANTED A PERMIT FOR WASHINGTON, D.C. THIS WILL BE YOUR FIRST EXPANSION OUSIDE OF THE NEW YORK AREA. TELL US HOW THIS WORKS. I THINK PEOPLE ARE FAMILIAR WITH A CITI BIKE OR LIME SCOOTERS. HOW DOES THIS COMPARE? >>I THINK A LOT OF SHARED MOBILITY OPTIONS, LIKE CITI BIKE, LIKE CAR 2 GO, YOU DOWNLOAD THE APP, REGISTER IT WITH THE APP, AND ONCE YOU PULL UP THE MAP, THERE IS A MAP OF ALL THE VEHICLES, WITH ALL OF THE ONES CLOSE TO YOU. YOU GIVE YOU THE OPTION TO RESERVE IT FOR FREE FOR 15 MINUTES. YOU WALK TO THE REBEL, START RIGHT WITHIN THE APP. THERE IS NO KEY INVOLVED. IT’S FULLY ELECTRIC. THE HELMET CASE UNLOCKS, AND YOU ARE OFF. >>THESE ARE MUCH LARGER THAN SCOOTERS ORE CITY BIKES. CITY BIKES ARE PRETTY FORMIDABLE. PRETTY HEAVY. THINKING ABOUT WHAT THIS PHYSICALLY DOES TO THE NEIGHBORHOODS YOU ARE IN, OR THE SPACES YOU ARE IN, I GUESS DOES IT CONCERN YOU THAT THEY MIGHT BASICALLY TAKE UP AN ENTIRE BLOCK OF THE SIDEWALK? BUT THEN THIS IS ALSO GOING TO CHANGE THE DYNAMICS OF WALKING MORE DRIVING AROUND SOME OF THOSE NEIGHBORHOODS. WHAT HAVE YOU SEEN SINCE GOING WITH A BROADER LAUNCH EARLIER THIS SEASON IN BROOKLYN AND QUEENS IN TERMS OF HOW REBEL IS CHANGING THE WAY PEOPLE ARE GETTING AROUND? >>WE ARE CHANGING THE WAY PEOPLE ARE GETTING AROUND. >>BUT IS IT GOOD OR BAD? ARE PEOPLE GETTING IN ACCIDENTS? DO PEOPLE FEEL THESE ARE ANNOYANCES? THERE HAS BEEN A LOT OF NEGATIVE BUZZ. MAYBE, MEDIA LIKES A MORE NEGATIVE BUZZ. >>I THINK IT’S IMPORTANT TO UNDERSTAND A RUBBLE IS A VERY DIFFERENT VEHICLE. THIS IS A MOTOR VEHICLE WITH A LICENSE PLATE. IT IS REGISTERED WITH THE STATE DMV, STAYS OFF SIDEWALKS, RIGHTS AND PARKS IN THE STREET. WE NEED FULL THIRD-PARTY LIABILITY INSURANCE, AND WE PROVIDE HELMETS WITH EVERY RIDE, WHICH IS SOMETHING NO OTHER DOCKLESS PROVIDER IS DOING ANYWHERE. DID I MENTION IT STAYS COMPLETELY OFF SIDEWALKS? WHEN YOU THINK ABOUT THE HEADACHES OF SCOOTERS AND DOCKLESS MOBILITY IS GIVING COMMUNITIES, IT’S BEING ON THE SIDEWALK. >>SO IF I GET ON ONE, AND I DON’T HAVE A LICENSE, I CAN GET PULLED OVER AND GET A TICKET. IF I’M NOT WEARING A HELMET, I CAN GET A TICKET. >>IT’S LIKE ZIPCAR. >>IF YOU FIND OUT I PARKED IT ON A SIDEWALK, WILL I BE PENALIZED BY YOU GUYS? IT SOUNDS LIKE YOU GUYS HAVE LOOKED AT YOUR RESPONSIBILITY FOR THE RIDER A LITTLE MORE CLOSELY, OR PERHAPS A LOT BIT MORE CLOSELY THAN SOME OF THE SCOOTER COMPANIES WHO SAY GREAT, THEY ARE OUT THERE. NOT OUR PROBLEM NOW. >>WE HAVE NO PROBLEM SUSPENDING USERS FOR BAD BEHAVIOR. WE HAVE NO PROBLEM DOING THAT. >>WHAT DOES THE UPKEEP LOOK LIKE? I IMAGINE THESE REQUIRE MORE MAINTENANCE THAN A LIME SCOOTER. HOW DO YOU DO THAT AS A COMPANY?>>REBEL EMPLOYS ABOUT 50 PEOPLE JUST IN OPERATIONS. WE HAVE A FULL TEAM OF FULL- TIME MECHANICS, FIELD TECHS, AND BATTERY SWAPPERS IN THE FIELD. IT’S A FULL-TIME WORKFORCE. 24/7. THREE SHIFTS A DAY CONSTANTLY KEEPING THESE VEHICLES CHARGED AND MAINTAINED. IT’S A VERY DIFFERENT MODEL. THIS IS A VEHICLE WE WILL OWN AND OPERATE FOR THREE YEARS, NOT THREE WEEKS. >>TO TALK ABOUT THE TIME, AND A LITTLE FURTHER OUT, WE JUST WENT THROUGH THE UBER AND THAT IPOs. SOMETHING WITH BOTH OF THOSE COMPANIES IS IT’S JUST GOING TO TAKE A LONG TIME TO MAKE MONEY. EVENTUALLY, WE WILL HAVE ATONOMOUS DRIVING, AND THEN THIS WILL ALL START TO MAKE SENSE TO EVERYBODY, AND TAKE A LONG TIME TURN HERE. HOW DO YOU THINK YOU FIT INTO ALL OF THAT? IS THERE A PLACE FOR YOU? AND THEN WHEN WE ARE ATONOMOUS, IS ANYONE GETTING ON A MOPED? >>WHEN I THINK ABOUT OUR COMPETITION, I THINK ABOUT UBER AND LYFT. I DON’T REALLY THINK ABOUT BIKES AND SCOOTERS. OUR AVERAGE COMMUTE IS 3 1/2 MILES. THAT’S A PERSONAL CAR TRIP, UBER TRIP, LYFT TRIP. WE ARE COMING FOR THOSE TRIPS. >>MAYBE, BIGGER PICTURE, YOU WERE AN INVESTMENT BANK ANALYST A COUPLE YEARS AGO. WHAT IS THE OPPORTUNITY YOU SAW WITH THESE SCOOTERS? IT DOESN’T SOUND LIKE MAYBE, THE OPPORTUNITIES WE THOUGHT YOU ARE LOOKING AT. >>WITH THE MOPEDS, I THINK ABOUT A VEHICLE THAT WORKS IN EVERY COUNTRY AROUND THE GLOBE. RICH, POOR, EUROPE, ASIA, SOUTH AMERICA, DOESN’T MATTER. THIS BECOMES THE PREFERRED VEHICLE IN EVERY MAJOR CITY. THERE IS ACTUALLY NOTHING NEW WITH THIS BUSINESS. SINCE WE LAUNCHED THEM IN BROOKLYN AND QUEENS, PEOPLE LOVE IT. >>I LIKE THAT YOU HAVE HELMETS. I AM A SAFETY PERSON. I WILL GO ON THE RECORD AND SAY THAT. THANKS FOR COMING IN. >>>COMING UP NEXT, THE CHICKEN FOOD FIGHT HEATING UP BETWEEN POPEYES, CHICK-FIL-A, AND WENDY’S WEIGHING IN. HEIDI CHUNG IS HERE. SHE WILL GIVE US HER TAKE ON THIS VIRAL BATTLE. IS THIS LOSING STEAM? >>A TINY BIT, I THINK. >>COMING UP, RIGHT AFTER THIS. >>>HERE IS MILES WITH A LOOK AHEAD AT WHAT WILL BE MAKING HEADLINES ON WEDNESDAY. >>HOME DEPOT CUT ITS FULL-YEAR SALES OUTLOOK ON TUESDAY. THE REASON WHY? TARIFFS. NATURALLY, THE STOCK RALLIED, BUT THE COMMENTARY FROM CORPORATE AMERICA CONTINUES TO POINT TO ONE THING, AND THAT’S A DIMMER ECONOMIC OUTLOOK. THE REASON WHY CONTINUES TO BE THE SAME. TARIFFS. MANY ECONOMISTS POINT TO CONTINUE TO JOB GROWTH AND A STRONG POSITION FOR THE U.S. CONSUMER AS EVIDENCE THAT THIS EXPANSION WILL CONTINUE, AND INDEED, SLOWER ECONOMIC GROWTH IS NOT A CONTRACTION IN GROWTH. BUT BETWEEN THE SIGNALS FROM THE BOND MARKET AND THE OUTLOOK BEING PUT FORTH BY CORPORATE EXECUTIVES, IT IS HARD TO DENY THAT WE ARE IN A NEW PHASE FOR THE U.S. ECONOMY. JUST BECAUSE THE ECONOMY DISAPPOINTS DOES NOT MEAN WE ARE IN OR NEAR A RECESSION. PERHAPS, WE ARE JUST BETTER OFF USING JAY POWELL’S WORDS, AND CALLING THIS A MIDCYCLE ADJUSTMENT. EVEN IF THAT TURN OF PHRASE IS A BIT STERILE AND FEELS SHORT OF CAPTURING WHAT THE MARKET REALLY SEEMS TO BE SAYING, WHICH IS THAT A RECESSION IS COVERED FIRST TIME IN A WHILE, A DEFINITE MAYBE. TURNING TO THE CALENDAR, MINUTES FROM THE LATEST FED MEETING WILL BE THE BIGGEST HIGHLIGHT AT 2:00 P.M. EASTERN. IT WILL OFFER INSIGHT INTO CONVERSATIONS AHEAD OF THE FED’S DECISION TO CUT INTEREST RATES LAST MONTH. THAT WAS THE FIRST TIME WE SAW A DECREASE IN THE FED BENCHMARK RATE SINCE 2008. THE CONSUMER REMAINS IN FOCUS. TARGET, LOWE’S, NORDSTROM, ALL AMONG THE COMPANIES SET TO RELEASE THEIR QUARTERLY REPORTS.>>LET’S PUT YOU IN A TIE. $18 LOBSTER SANDWICHES. >>A POKE BOWL IS $16 DEEP. >>THE CONSUMER IS DOING WELL THERE. >>>IT’S A WAR FOR THE BEST CHICKEN SANDWICH, AND IT’S ON. CAJUN FAST FOOD CHAIN POPEYES HAS CAUSED A FRIED CHICKEN FRENZY OVER THE LAST TWO DAYS WITH THE INTRODUCTION OF ITS OWN CHICKEN SANDWICH. THIS ANNOUNCEMENT GUARDED STRONG REACTIONS FROM CHICK-FIL- A, AND WENDY’S, WHO TWEETED YOU ARE ALL FIGHTING ABOUT WHICH OF THESE FOOLS HAS THE SECOND ASKED CHICKEN SANDWICH. >>>I OFFERED YOU A POPEYES CHICKEN SANDWICH, BUT YOU DIDN’T TRY IT. >>DO YOU WANT IT IN A SAFE SPACE? >>I HAD A REGULAR SANDWICH TODAY, SO I WASN’T HUNGRY. >>FULL CAVEAT. I AM A HUGE CHICK-FIL-A FAN. I WENT INTO THIS WITH CHICK-FIL- A MY NUMBER ONE FAVORITE OF ALL TIME, BUT IT CAME OUT MY LEAST FAVORITE. >>WAS THIS BLIND? >>IT WAS NOT. I WAS SEEING EVERYTHING. I WAS EATING WITH MY EYES. I TRIED POPEYES. IT’S THE SMALL DETAILS. THEY BUTTER THE BOND, FOR INSTANCE. AND THE RATIO BETWEEN CRUNCH AND CHICKEN, AND FUN WAS ALSO BEAUTIFULLY EXECUTED. IT WAS NOT SOGGY WHEN IT ARRIVED. WHY ARE YOU LAUGHING AT ME? >>YOU REALLY FOUND YOUR CALLING. >>WHAT CAN I SAY? CHICK-FIL-A HAS THE SAME PACKAGING, WHERE IT’S THE BAG WITH THE FOIL INTERIOR, BUT THE PAPER EXTERIOR, WHICH KEEPS IT FROM GETTING TOO MOIST, BUT CHICK-FIL-A ARRIVED A LITTLE SOGGY. MILES LAUGHED AT ME WHEN I SAID THIS, BUT THERE WAS TOO MUCH CHICKEN AND THE RATIO WAS OFF. >>THINK ABOUT THIS COMPLAINT. THERE IS TOO MUCH CHICKEN IN MY CHICKEN SANDWICH. >>I HEAR HER. >>WENDY’S WAS PRETTY GOOD. IT WAS SOLID. I GAVE IT SECOND. >>SO, YOU LIKE THE POPEYES. >>I ENJOYED IT. >>IT’S NOT JUST A TRENDING TOPIC. >>IT’S TRENDING FOR A REASON. >>I WILL BRING YOU BACK TO OUR CALL OF THE DAY. IT SAID HEAR, TASTE ALMOST ALWAYS WINS. >>99.9 PERCENT. >>I’VE HEARD POPEYES HAS A LITTLE BETTER FRIED THAN THE CHICK-FIL-A. MY CONCERN, PERSONALLY, AS SOMEONE WITH A SENSITIVE STOMACH, IS THAT IT WOULD BE TOO FRIED, AND HALFWAY THROUGH, I WOULD REALIZE I HAVE MADE A MISTAKE. >>TOO MUCH CHICKEN, TOO MUCH FRY. IT’S A DELICATE BALANCE. >>THIS IS A COMMON COMPLAINT. PEOPLE WITH SENSITIVE STOMACHS WHO CAN’T DO FRY. >>I’VE DEVELOPED AN IMMUNITY TO IT ALL. >>YOU ARE A BETTER PERSON THAN I AM. >>THANK YOU FOR THAT REPORT. >>VERY IMPORTANT. >>IT’S ONE OF THOSE THINGS. WE’VE GOT JACKSON HOLE, BIG DEAL FOR MARKETS, BUT WE ALSO HAVE POPEYES. THIS IS THE STUFF WE SHOULD ACTUALLY BE DOING. WE SHOULD BE DOING CHICKEN NEWS, JAY POWELL NEWS. >>AND WENDY’S DID TOUCH A 52- WEEK HIGH. I WOULD LIKE TO BRING IT BACK TO BUSINESS NEWS. >>CHICK-FIL-A HAS THE BEST SAUCE IN THE GAME. LET’S MAKE THAT CLEAR. >>>COMING UP ON THE FINAL ROUND, THE CEO OF THE COUNTRY’S TOP DETOX TEA COMPANY WITH CELEBRITY ENDORSEMENTS, INCLUDING THE KARDASHIANS, AND MICHAEL GONZALEZ WILL TAKE HIS BUSINESS TO THE NEXT LEVEL BY TAPPING INTO THE CBD BUSINESS. HE WILL JOIN US TO DISCUSS, COMING UP AFTER THE BREAK. >>>WELCOME BACK TO THE FINAL ROUND HERE ON YAHOO FINANCE. I AM JOINED BY MY CO-HOST JEN ROGERS, AND CHIEF CORRESPONDENT HEIDI CHUNG. LET’S TAKE A LOOK AT WHERE THE MARKETS SETTLED ON THIS TUESDAY. MARKETS, PRETTY MUCH GOING OUT ON LOWS FOR THE SESSION. THE DOW OFF 170 POINTS FROM THE DUST SETTLED. THE S&P OFF ABOUT 8/10 OF A PERCENT. THIS WEEK, WE WILL REALLY START GETTING GOING. TOMORROW, WE WILL GET THE MINUTES FROM THE FED’S LATEST MEETING. WE WILL THEN PIVOT OUR ATTENTION WEST FOR THE JACKSON HOLE ECONOMIC SUMMIT. THAT’S 8:00 A.M. MOUNTAIN TIME. I THINK THE MARKETS ARE EXPECTING A LOT, AT THIS POINT. THERE IS SOME SENSE THAT IF HE WANTS TO PUT THE BED BACK IN PLAY, HE MIGHT NEED TO SUGGEST A 50-BASIS POINT CUT. THE MARKETS, RIGHT NOW, LOOKING FOR A 25-POINT BASIS CUT IN SEPTEMBER AND ANOTHER 25 IN NOVEMBER. TWO MORE CUTS THIS YEAR. PRETTY MUCH, THE BASE CASE FOR MARKETS RIGHT NOW. THE WHOLE POINT OF THE FED BEING IN CONTROL OF THE MARKET IS THEY CAN STILL SURPRISE PEOPLE. I THINK THAT HAS KIND OF COME OUT OF THE WAY INVESTORS ARE BETTING ON THIS. >>WHEN WAS THE LAST TIME THEY SURPRISED US? >>1994. 2008. >>IT’S LIKE HOW DO YOU SURPRISE PEOPLE WHEN YOU ISSUE YOUR DOT PLOT, TALK AFTER EVERY PRESS CONFERENCE, AND EVERY FED GOVERNOR GOES TO SPEAK AD NAUSEAM. I THINK THE AMMUNITION OF THE SURPRISE IS HARD. THE FOCUS ON RATES CONTINUES. YOU WERE LOOKING AT HOMEBUILDERS. UP THREE DAYS IN A ROW. HOMEBUILDERS, UP THREE DAYS IN A ROW. X ELLERY, TOUCHED A HIGH TODAY. I THINK THOSE THINGS ALSO GO INTO THE STOCK STORY OF THE DAY, WHICH HAPPENS TO BE HOME DEPOT. ALL OF THESE THINGS, KIND OF WORK TOGETHER. IT’S ALL SORT OF INTEREST RATE PLAYS, AND REAL ESTATE, AND THE CONSUMER, AND EVEN THOUGH I CAN CONNECT THE STOCK, I AM STILL NOT 100 PERCENT SURE WHAT IT’S TELLING ME. >>WE HAVE LOWS IN THE MORNING. WE WILL GET MORE OUT OF THOSE EARNINGS, BUT WITHIN THE RETAIL SPACE, THERE IS TWO DIFFERENT STORIES. WE HAVE THE DEPARTMENT STORES, AND EVEN T.J. MAXX TODAY, OR TD TELLS US A STORY THAT, MAYBE, THESE RETAILERS AREN’T DOING ALL THAT HOT. WE’RE SEEING GOOD BOOKS DO REALLY WELL, BUT TOMORROW WE WILL GET TARGET. WE WILL GET MORE COLOR ON THAT SPACE, AS WELL, BUT TOMORROW WILL BE A BIG DAY IN TERMS OF RETAIL EARNINGS. WE WILL GET A BETTER FEEL OF WHAT THE CONSUMER WANTS, AND FOR THEY ARE SHIFTING THEIR ROUTE TO SPEND MONEY, BUT I AM NOT EXPECTING GOOD RESULTS OUT OF NORDSTROM. >>WE HAD HOME DEPOT AND LOWS, BOTH DOING WELL TODAY, BUT KOHL’S, ONE OF THE TOP DECLINERS, WAS DOWN TO SEVEN PERCENT. MACY’S, DOWN 4.8 PERCENT. NORDSTROM, DOWN 3.6 PERCENT. WE’VE SEEN THIS DIVERGENCE BEFORE IN RETAIL. WE’VE COVERED IT A LOT. >>I THINK FROM A MACRO PERSPECTIVE, IT’S NOT HARD TO TALK YOURSELF INTO A STATE WHERE THE CONSUMER IS IN GOOD SHAPE, AND DEPARTMENT STORES ARE COMPLETELY FLAILING. THEY HAVE SPECIFIC HEADWINDS WORKING AGAINST THEM. >>>LET’S TURN TO OUR TOP TAKE OF THE DAY. WE WILL STICK WITH THE U.S. CONSUMER. THE APPLECART IS FINALLY HERE. OF COURSE, WHEN NEW PRODUCTS COME TO MARKET, JEN ROGERS IS ALL OVER THEM. ALL RIGHT. YOU HAVE AN APPLECART. I GUESS IT WAS AN EASY APPROVAL PROCESS. >>SO EASY. IT’S SO EASY TO GET, IT’S KIND OF SCARY, BUT DID EITHER OF YOU APPLY FOR IT? >>NO. MILES AND I ARE NOT INTO IT. >>WHAT DID IT FOR ME BECAUSE I WASN’T GOING TO DO IT, BUT THREE PERCENT BACK ON UBER WAS WHAT DID IT. >>BUT THROUGH AMERICAN EXPRESS, DON’T YOU ALREADY HAVE ENOUGH? >>I WILL GET THAT BACK THERE. YOU ONLY GET LIKE $15 A MONTH. I WILL USE THAT FOR MY APPLE PAY. THAT’S WHAT SEALED THE DEAL FOR ME. BUT, BASICALLY, IT’S THE EASIEST THING TO DO. THEY KNOW SO MUCH ABOUT YOU. YOU JUST PRESS THE +. IT KNOWS YOUR NAME. AND THEN IT HAD MY NAME AND ADDRESS. IT ASKED ME TO CONFIRM THE LAST DIGITS OF MY SOCIAL SECURITY NUMBER. IT REQUIRED MORE INFORMATION FROM ME. I HAD TO SUBMIT MY DRIVER’S LICENSE. AFTER THAT, — THE RUSSIANS HAVE THAT. I’M ALSO A CUSTOMER OF GOLDMAN SACHS. I THOUGHT IT WAS EASY. IT GAVE ME A BIG SPENDING LIMIT. I THINK IT WILL BE INTERESTING TO SEE HOW IT WORKS OUT, BUT WITH MY TESTING TODAY IS ANY INDICATION, PEOPLE WHO ARE INTERESTED IN IT WILL HAVE A LOT OF UPTAKE. I DON’T KNOW ABOUT THE PHYSICAL CARD. I THINK YOU HAVE TO GO AND REQUEST THAT, AND I DO NOT NEED ANOTHER CARD IN MY WALLET. >>SOMEONE WHO IS EXCITED ABOUT THIS WOULD BE CEO DAVID SOLOMON OF GOLDMAN SACHS. HE SENT AN INTERNAL EMAIL TO EMPLOYEES. “THE APPLECART IS BIG, BUT IT’S ALSO JUST THE BEGINNING FOR THE COMPANY.” I JUST FIND THE GOLDMAN-APPLE MASHUP COMBINED WITH UBER BENEFITS. IT’S VERY INTERESTING THAT AT THIS POINT IN THE CYCLE, THE ONLY IDEA, IT SEEMS LIKE SOME OF THESE COMPANIES HAVE, IS HOW CAN WE EXTRACT MORE OUT OF THE CONSUMER? I KNOW THAT THE CONSUMER IS IN PRETTY GOOD SHAPE. PEOPLE ARE STILL GETTING JOBS. WAGE GROWTH, EVEN IF IT IS DISAPPOINTING SOME ECONOMISTS IS AT THE HIGHEST LEVEL SINCE THE CRISIS, BUT IT FEELS LIKE EVERY COMPANY HAS GOT THE SAME IDEA, TRYING TO GO BACK TO THE WELL TO GET PEOPLE TO SPEND MORE, TO LEVER UP WITH THEM AS THEIR PARTNER. TO ME, THAT FEELS WORRISOME. >>WHERE ELSE ARE THEY GOING TO GO? >>I DON’T KNOW. >>BESIDES TO THE CONSUMER. THEY ARE ABLE TO SQUEEZE AS MUCH AS THEY CAN OUT OF THEM, SO MIGHT AS WELL CONTINUE SQUEEZING. WHERE WOULD YOU GO? >>IF I’M GOLDMAN SACHS, I WOULD BE TRYING TO MAKE MONEY IN THE INVESTMENT BANKING SPACE, OR SAY REGULATIONS MAKE IT SO WE CAN’T DO TRADING. TODAY, APPARENTLY THEY GOT RID OF IT. WHEN APPLE AND GOLDMAN ARE LIKE WE NEED CONSUMERS WITH, PERHAPS, LESS THAN STELLAR CREDIT SCORES. MATTHEW, NOT YOU. IT JUST FEELS TO ME LIKE EVERYONE HAS GOT ONE IDEA. >>IT FEELS LIKE A SYNERGY. LET’S GET ALL THESE NAMES TOGETHER. >>IT’S ONE THING IF YOU HAVE B.C. STRATEGISTS SAYING APPLE AND GOLDMAN NEEDS TO GET TOGETHER ON SOME MOONSHOT PRODUCTS. JPMORGAN SHOULD PARTNER WITH AMAZON FOR HEALTHCARE, BUT THAT’S LITERALLY WHAT IS HAPPENING. IT’S LIKE FANTASY FOOTBALL, BUT FOR BUSINESS. IS THAT WHERE WE ARE AT? >>THE BRAND IS SO POWERFUL, THEY ARE JUST TRYING TO LEVERAGE THEIR BRAND. >>THEY ARE LIKE APPLE AND GOLDMAN. >>I WILL TELL YOU HOW IT GOES. >>>INFLUENCER MARKETING IS BECOMING THE STANDARD FOR BRANDS AND PRODUCTS ALIKE AND ONE OF THE EARLY ADOPTERS IS FITNESS WITH THE KARDASHIAN FRIEND AMBER ROSE LEVERAGING THE $75 MILLION EMPIRE. MICHAEL GONZALEZ JOINS US NEXT TO TALK ABOUT HIS NEXT VENTURE. MICHAEL JOINS US NOW. THANKS FOR STOPPING BY. TELL US WHAT WE NEED TO KNOW ABOUT HAPPY TEA. NOT THE FIRST PERSON TO COME THROUGH HERE AND TALK ABOUT CBD PRODUCTS, BUT WHAT ARE YOU GOING FOR IN THIS MARKET? WHAT EXCITEMENT ARE YOU SEEING? >>WE ARE SPEARHEADING WITH INFLUENCER MARKETING. WE WANTED A PRODUCT THAT WAS A DIFFERENTIATOR IN THE MARKET SPACE. MOST OF THE CBD PRODUCTS ARE IN TINCTURES AND OIL FORM. WE WANTED TO CREATE A FAMILY- FRIENDLY TYPE PRODUCT THAT WAS MUCH LESS INVASIVE IN THE WEED MARKET, AND MAKE IT TASTE GOOD, BE FRIENDLY, THC FREE. A BEVERAGE. SOMETHING THAT IS A LITTLE BIT SOFTER TO THE PALLET. >>IS THIS A TEABAG? >>THEY ARE STICKS. THEY ARE IN POWDER FORM. YOU POUR IN THE WATER AND SHAKE IT UP. >>IT’S LIKE GATORADE. CAN YOU TALK ABOUT YOUR OWN EXPERIENCE WITH CBD? WE’VE TALKED TO A LOT OF DIFFERENT COMPANIES DOING THE OIL DROPS, OR THE CREAMS, OR THE PILLS, OR THE GUMMIES, AND WE TRIED THEM. SOMETIMES, IT FEELS LIKE SOMETHING. SOMETIMES, IT DOESN’T. WHAT HAS YOUR EXPERIENCE WITH CBD BEEN? HOW DOES IT WORK FOR YOU? ALSO, WHAT ABOUT THE CHEMICALS? IS THIS A DIFFERENT TYPE OF EXTRACT VERSUS SOME OTHER PRODUCTS? >>WHAT HAPPENED WAS I FOUND FIT T, AND I GREW IT TO A MASSIVE COMPANY. I WAS STRESSING, TRYING TO EXPAND INTO WALMART, TARGET, CVS, AND I WAS TAKING ON SUCH A BIG MILESTONE OF A PROJECT, AND I WAS GOING THROUGH PERSONAL ISSUES. I ENDED UP WITH AN ANXIETY DISORDER. I EXPERIENCED PANIC ATTACKS, AND I UTILIZED CBD AT THE TIME. THAT WAS THE CATALYST. ONCE I RECOVERED, I REALIZED THERE WAS A HUGE OPPORTUNITY TO DO A CBD PRODUCT THAT WAS REALLY HIGH-QUALITY, AMERICAN- MADE. THE PRODUCTS ARE COMING FROM CHINA. WE GET OUR HEMP FROM COLORADO. IT WAS A PERSONAL EXPERIENCE THAT GAVE ME THE CATALYST FOR THIS PRODUCT. >>YOU HAD A LOT OF SUCCESS WITH INFLUENCER MARKETING. IS IT STILL AS ALIVE AND WELL AS IT WAS WHEN YOU STARTED IN THIS GAME? >>IT’S A LITTLE DIFFERENT. IT’S ALIVE AND WELL. IT’S A MARKETING CHANNEL EVERY BUSINESS SEEMS TO BE UTILIZING. IT HAS CHANGED. THERE ARE ALGORITHMS THAT DON’T GIVE YOU AS OPEN A REACH AS IT ONCE WAS, SO YOU HAVE TO BE MORE STRATEGIC, AND VERY CAREFUL. MAKE SURE IT’S PROFITABLE. IT IS DEFINITELY ALIVE AND WELL. THE FUTURE IS BRIGHT FOR INFLUENCER MARKETING. >>WHAT IS THE ENDGAME HERE? ARE YOU TRYING TO GO PUBLIC? DO YOU WANT TO GET ACQUIRED? >>THE GOAL IS TO GO PUBLIC IN THE FALL. DUAL EXCHANGE HERE IN CANADA, AND IN THE UNITED STATES. WE WANT TO BECOME THE NUMBER ONE BRAND IN THE SPACE, AND REALLY SPEARHEAD THE RETAIL MARKET. >>DO YOU WANT TO GET INTO THC PRODUCTS? DO YOU WANT TO STAY IN THE CBD SPACE? WHERE DO YOU SEE THINGS GOING AS AN OPERATOR? A LOT OF CONSUMERS GROUP IT TOGETHER. THEY THINK CBD, THC IS LEGALIZED WEED, EVEN THOUGH IT’S NOT WHAT IT IS. >>WE ARE GOING TO PRIMARILY FOCUS ON THE CBD SPACE, THE THC SPACE. WE SEE A GOLDEN OPPORTUNITY IN THE SENSE OF SOMETHING THAT DOESN’T CAUSE A HIGH, AND IS MUCH MORE MEDICINAL. THE ENTIRE MARKET IS GROWING BOTH IN CBD AND THC, BUT WE SEE THE OPPORTUNITY IN CBD. >>IS WALMART GOING TO BE TAKING HAPPY TEA? >>WE ARE ALREADY IN DISCUSSION WITH WALMART. WE HAD A HUGE DISCUSSION OVER SIX YEARS. THOSE DISCUSSIONS ARE ALREADY HAPPENING IN THE BACKGROUND. IT’S JUST A MATTER OF TIME BEFORE THEY PUT THEM ON THE SHELVES. >>WHY DON’T YOU WANT TO GO PUBLIC? >>IT WOULD ALLOW US TO GET TO A SPACE THAT’S MUCH LARGER THAN IF I KEPT IT PRIVATE. IT WOULD ALLOW ME TO GROW THE BUSINESS TO A SCALE I CAN’T REACH BY MYSELF. I THINK IT WILL BE AS BIG AS COCA-COLA, JUST CBD. >>DO YOU THINK IT WILL BE AS BIG AS BEYOND MEAT? >>IF YOU INVEST IN THIS BUSINESS, IT’S GOING TO BE HUGE. HUGE! >>EVERYTHING ALTERNATIVE COMING UP. MICHAEL GONZALEZ, FOUNDER OF HAPPY TEA. THANK YOU FOR JOINING US. HEIDI CHUNG, INC. JOIN. HAVE A GREAT EVENING. >>>COMING UP, YOUR TOP PILOTS FROM YAHOO FINANCE WITH WHAT YOU MISSED. WE ARE BACK RIGHT AFTER THIS. >>>IT’S TIME NOW FOR ALL THE BEST MOMENTS YOU MISSED TODAY ON YAHOO FINANCE. >>WE ARE SEEING BIG SPENDING MORE ABOUT 20 EMBOLO. I THINK WE ARE GETTING CLOSER TO A RECESSION, AND IT IS SOMETHING PEOPLE NEED TO TAKE SERIOUSLY. >>IT’S A BUYERS MARKET. IT IS DEFINITELY A BUYERS MARKET, AND SELLERS HAVE HAD TO ADJUST THEIR PRICES, IF THEY WANT A DEAL DONE. >>THEY ARE TRYING TO FIGURE SOMETHING OUT TO BOOST THE ECONOMY. THIS ADMINISTRATION ROUTINELY THROWS STUFF AGAINST THE WALL TO SEE WHAT WORKS. >>I AM IN THE CAMP THAT BELIEVES THERE ARE BENEFITS TO CONSUMERS BREAKING THESE COMPANIES UP IS ULTIMATELY NOT IN THE BEST INTERESTS OF THE CONSUMERS. I THINK THAT IS ULTIMATELY WHAT’S GOING TO HAPPEN IS THESE COMPANIES WILL NOT BE BROKEN UP, BUT I THINK THAT CONVERSATION WILL GO ON FOR THE BETTER PART OF THE NEXT COUPLE OF YEARS. >>FILED A TON OF PATENTS, BUT MORE PROPERTY, SOME MORE SHIPMENTS INTERNATIONALLY THAN EVER BEFORE, WHICH TELLS ME THEY ARE LOOKING TO LONG TERM IMPLEMENT THE RIGHT PLAN, I THINK, WHICH IS TO CREATE DURABLE, DIFFERENTIATED PRODUCTS BECAUSE THEY ARE NOVEL AND PROTECTED. >>WE’VE SEEN UNPRECEDENTED VOLATILITY. WE’VE HAD BACK-TO-BACK WEEKS OF A MONDAY LOSS AND A TUESDAY GAME THAT EXCEEDED ONE PERCENT. THAT’S THE FIRST TIME SINCE 1952, SO I THINK THE FED WILL BE MORE SENSITIVE TO MARKET REACTION, AND HE NEEDS TO DELIVER. >>AS GOLD CONSOLIDATES, IT’S THE TREASURIES YOU HAVE TO WATCH AND THE U.S. DOLLAR. THE U.S. DOLLAR INDEX ISN’T ABOVE THE PREVIOUS HIGHS OF THE YEAR. IT’S FLIRTING RIGHT THERE. THE SAME WITH THE EURO. IF WE SEE A DIRECTIONAL MOVE, WITH THE EURO LOWER, AND THE DOLLAR HIGHER, BUT WITH YIELDS NOT GOING LOWER, IT’S NOT GOING TO BE A GREAT LANDSCAPE. >>>WALMART IS SUING TESLA FOR BREACH OF CONTRACT AFTER TESLA SOLAR PANELS IGNITED THE TOP SEVEN WALMART STORES, ACCORDING TO A COURT FILING. THE TWO COMPANIES GO WAY BACK AND HAVE BEEN PARTNERS ON CLEAN ENERGY INITIATIVES FOR YEARS. WALMART IS ASKING TESLA TO REMOVE SOLAR PANELS WHERE THEY’VE BEEN INSTALLED, AND TO PAY DAMAGES RELATED TO THE FIRES. WE ARE REACHING OUT TO TESLA FOR COMMENT. TESLA STOCK IS MOVING SLOWER JUST FRACTIONALLY. >>>COMING UP, GENE MUNSTER ON THE STATE OF BIG TECH. WE ARE GOING TO HAVE THAT INTERVIEW RIGHT AFTER THIS BREAK. >>>LET’S TAKE A LOOK AT SOME OF TODAY’S WINNERS AND LOSERS IN THE STOCK MARKET. STOCKS ARE RED, INCLUDING U.S. STEEL AFTER THE COMPANY ANNOUNCED PLANS TO TEMPORARILY LAY OFF HUNDREDS OF WORKERS IN MICHIGAN, ACCORDING TO A STATE FILING. THE COMPANY SAYS THE LAYOFFS COULD LAST SIX MONTHS OR LONGER. FIBER NET, A COMMUNICATIONS DEVICE MAKER, GAVE A DISAPPOINTING EARNINGS FORECAST. THE COMPANY ALSO CUT ITS OUTLOOK FOR THE FULL YEAR. KOHL’S, DESPITE BEATING ANALYST EXPECTATIONS FOR THE QUARTER MISSED SALES FORECASTS, AND LOGGED A COMPARABLE STORE SALE DECLINE OF 2.9 PERCENT, LARGER THAN THE 2 1/2 PERCENT SLIDE THE STREET WAS LOOKING FOR. THAT STUCK DOWN ALMOST 7 PERCENT ON THE SESSION. STOCKS IN THE GREEN. BEYOND MEAT ENJOYING A BOOST AFTER THE STOCK WAS UPGRADED TO OVERWEIGHT FROM NEUTRAL AT J.P. MORGAN CHASE. WE DISCUSSED THAT EARLIER. HOME DEPOT SHARES ARE HIGHER, DESPITE REVENUE FOR ITS MOST RECENT QUARTER, FALLING BELOW ANALYST FORECASTS. THE RETAILER REPORTED EARNINGS THAT BEAT EXPECTATIONS BY NINE CENTS PER SHARE. IT ALSO AFFIRMED ITS FULL-YEAR PROFIT OUTLOOK. JCPENNEY SHARES THE RETAILER’S CLIMB AFTER AN SEC FILING REVEALED THE COMPANY’S CHAIRMAN, RONALD TYSON, BUT 1 MILLION SHARES OF JCPENNEY LAST WEEK. THAT WAS JUST AFTER THE STOCK HIT A RECORD LOW OF $.53 PER SHARE. >>>A BIPARTISAN GROUP OF STATE ATTORNEY GENERAL’S ARE PREPARING TO MOVE FORWARD WITH AN ANTITRUST INVESTIGATION OF SOME BIG TECH COMPANIES. THE “WALL STREET JOURNAL” EXPECTS TO ISSUE SUBPOENAS AS EARLY AS NEXT MONTH. GENE MUNSTER JOINED US EARLIER TODAY TO EXPLAIN. >>THIS WOULD BE KIND OF AN ADD- ON TO WHAT THE FTC IS DOING, AND WHAT THE OVERALL GENERAL TRADE COMMISSION IS DOING AROUND SOME OF THIS BIPARTISANSHIP SUPPORT FOR GREATER REGULATION IN TECH. THE SIMPLER ANSWER IS, AT THE MOST BASIC LEVEL, THERE IS GOING TO BE MORE RED TAPE THAT SOME OF THESE COMPANIES HAVE TO GO THROUGH, AND ULTIMATELY, YOU ARE PROBABLY GOING TO SEE CHANGES TO HOW THEY CAN SHARE DATA, OR AT LEAST SOME OF THE NOTIFICATIONS AROUND HOW YOUR DATA IS BEING SHARED. THAT’S IMPORTANT FOR COMPANIES, LIKE FACEBOOK, FOR EXAMPLE, WHICH COULD HAVE A SMALL SHIFT IN TERMS OF THEIR ENGAGEMENT. YES, THEY SHOULD BE FOCUSED ON THIS. GOOGLE, ON THEIR LAST EARNINGS CALL WAS ASKED THIS QUESTION ABOUT A GREATER REGULATORY ENVIRONMENT. THEY INITIALLY DISMISSED THE QUESTION, SAYING THEY HAVE OPERATED IN AN INTENSE REGULATORY ENVIRONMENT, INCLUDING EUROPE, AND THIS IS NOTHING NEW TO THEM, BUT I THINK THIS COLLECTIVELY MARKS A STEP UP IN TERMS OF THE INTENSITY THEY ARE GOING TO BE SCRUTINIZED. >>PLUS, STATES ATTORNEYS GENERAL FROM BLUE AND RED STATES. THIS IS ONE OF THOSE RARE MOMENTS WHERE BOTH SIDES ARE COMING TOGETHER TO GO AFTER THE SAME TARGET. >>IT’S A RARE MOMENT. IT MAKES FOR GOOD POLITICS BECAUSE I THINK THERE IS JUST A GENERAL SENSE ACROSS THE BOARD FROM BOTH POLITICAL PARTIES THAT THEY CAN USE THIS TOPIC OF KIND OF GREATER TECH TO THEIR ADVANTAGE. I DO QUESTION, AT THE END OF THE DAY, IF CONSUMERS ACTUALLY WANT THIS. STICK WITH ME FOR A MINUTE. IN AN ENVIRONMENT WHERE YOU HAVE GREATER SECURITY AROUND YOUR DATA, AND I THINK WHEN PEOPLE HEAR THEIR DATA, THEY ACTUALLY THINK IT’S DATA THAT IS VALUABLE TO THEMSELVES WHEN, IN FACT, IT’S PROBABLY MORE VALUABLE TO ADVERTISERS. THERE IS GOING TO BE A COST TO CONSUMERS TO GIVE THIS UP, SPECIFICALLY AROUND FUNCTIONALITIES OF THE PRODUCTS. POTENTIALLY, SOME PRODUCTS COULD GO AWAY ALTOGETHER. I WANT TO KEEP THAT IN MIND, EVEN THOUGH THIS MAKES FOR A GOOD POLITICAL TALKING POINT FOR REGULATORS. I THINK THE CONSUMER MAY NOT ACTUALLY BE BETTER OFF UNDER THESE ENVIRONMENTS. >>RICK NEWMAN IN NEW YORK HERE. THERE IS A BIG DIFFERENCE BETWEEN REGULATORS INVESTING IN THESE COMPANIES AND REGULATORS IMPOSING OR SUING IN SOME WAY, AND SEEKING ACTION. WHICH OF THESE COMPANIES DO YOU THINK IS FORMIDABLE TO SOME KIND OF GOVERNMENT ACTION? WHAT MIGHT THAT ACTION BE? >>GOOGLE AND FACEBOOK — LET ME REVERSE THAT ORDER. PROBABLY, IN ORDER OF VULNERABILITY, FACEBOOK IS AT THE TOP, SPECIFICALLY AROUND CONSUMER DATA. HAT IS NOTHING NEW TO T FACEBOOK STORY. THEY’VE PAID A FINE, BUT THERE IS STILL SOME OPEN-ENDED QUESTIONS IN TERMS OF HOW THEY SHARE, AND HOW THEY NOTIFY PEOPLE ABOUT HOW THEY ARE USING DATA. IN GOOGLE’S CASE, GOOGLE WOULD SAY SEARCH IS 90 PERCENT OF THEIR BUSINESS, WHICH IS A USER- DRIVEN INTENT. YOU TYPE IN THE WORD YOU ARE SEARCHING FOR, WHICH IS DIFFERENT FROM SOMEONE SCRAPING DATA PRIVACY, BUT THE ISSUE WITH GOOGLE IS THE USE THAT SEARCH DOMINANCE TO ULTIMATELY BENEFIT OTHER PRODUCTS. FOR EXAMPLE, PRODUCTS ARE TIGHTLY INTEGRATED, LIKE GMAIL, OR GOOGLE MAPS. THAT IS SOMETHING I THINK THOSE TWO — APPLE UNDOUBTEDLY GETS BROUGHT INTO THIS BECAUSE THEY ARE A LARGE TECH COMPANY, BUT I THINK BY FAR, THEY HAVE THE LEAST RISK RELATED TO THIS TOPIC. AMAZON IS SOMEWHERE IN BETWEEN. >>INTERESTING DISCUSSION REGARDING CHAIRMAN OF THE TRADE COMMISSION, SIMON SIMMONS. HE FACES PUSHBACK REGARDING COMMENTS ABOUT BREAKING UP FACEBOOK. HE TOLD THE FINANCIAL TIMES AT FACEBOOK’S PLANS TO MERGE WHATSAPP, FACEBOOK, AND INSTAGRAM WOULD MAKE IT HARDER TO BREAK UP SHOULD THE GOVERNMENT MOVE TO DO THAT. WE KNOW THE FTC IS CONDUCTING THIS INVESTIGATION. WHAT DO YOU THINK? >>I BELIEVE THERE IS BENEFITS TO CONSUMERS, SO I’M IN THE CAMP THAT SAYS BREAKING THESE COMPANIES UP IS NOT ULTIMATELY IN THE BEST INTERESTS OF CONSUMERS. I THINK THAT IS ULTIMATELY WHAT’S GOING TO HAPPEN, THESE COMPANIES WILL NOT BE BROKEN UP, BUT I THINK THAT CONVERSATION WILL GO ON FOR THE BETTER PART OF THE NEXT COUPLE OF YEARS ABOUT BREAKING UP, BUT I DON’T THINK THAT WILL COME TO FRUITION. >>THAT’S ALL FOR NOW FROM NEW YORK. THE MARKETS ARE LOWER TODAY. I AM JEN ROGERS WITH MILES OF AN. THIS IS THE FINAL ROUND ON YAHOO.

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