tv Worldwide Exchange CNBC August 7, 2019 5:00am-6:00am EDT
any sign of relief stocks looking for direction after a welcome rebound from what was the worst day of the year for the dow china's central bank keeping investors on edge, taking steps overnight to steady its currency but keeping it a hair away from the key 7-1 level. could now be the time to buy into beijing one legend dare hedary hedge fur is bullish on china. and gold doing something it has not done since the obama
administration and disney revealing the true villain of its marble universe as earnings disappoint and the stock sags on this wednesday, august 7th. "worldwide exchange" begins right now. ♪ >> afternoon, good evening and welcome from wherever in the world you may be watching. i'm brian sullivan thanks for joining us on "worldwide exchange. it is only wednesday, but it already feels like a full week, doesn't it down big on monday half of it gained back basically yesterday. here's how things look now futures are not giving you help. look at that, dow futures are up a scant 7 points one of the quietest mornings we've had in a few days. in bonds, the ten-year yield continues to be on the move. bond yields keep coming down look at that yield
1.68%. below 1.7. that seems very low for us, but consider that nearly $15 trillion worth of government debt around the world, countries like japan, germany, france, denmark, they have negative interest rates maybe the global race rate to the bottom, three central banks today cutting their interest rates, new zealand, india and thailand you may not care about those markets, but this could signal the beginning of what could be a global easing cycle among our central bank, the ecb, the bank of china, who knows. a lot of rate cuts taking place around the world in the asian markets, the hang seng -- look at that. it rose 0.08%. so why am i highlighting it? that little gain broke a ten-day losing streak. the hang seng had been down ten days in a row coming into today. that was the longest losing streak since 1984.
the nikkei and shanghai fell fractionally in europe, a bit of a rebound. more grown on the screen with the dax and the cac up 1%. the biggest story outside of stocks and the trade fight is oil. the continued collapse of oil and gas stocks oil falling again yesterday. oil both here and overseas deeply in bear markets that's slammed oil and oil stocks one of the biggest etfs in the group is the xop the xop is down 12% in a week. it's down more than 48% in a year the average return of a stock on a company operating in north dakota is a drop of 64% in a year so why are these stocks collapsing more than the price of oil we'll do more on that tomorrow and all day on cnbc. tune in. as we noted, it's been a
real topsy-turvy few trading days for stocks. it all began last wednesday. the fed's now infamous utterance about a midcycle adjustment. that sent the dow down 300 points the dow taking another hit on thursday when president trump said a new round of tariffs will kick in on september 1st and that stole another 280 points from the dow the next day, china retaliated kind of. they had strong words, no hard action, but those words shaved another 100 points off the index. then came monday oh, monday china's currency swooned, stocks sold off in a big way. the dow down 767 points, one of the ten biggest point losses ever for that index. then yesterday, trump calling china a currency manipulator and china did manipulate its currency, but it manipulated by trying to lock it in higher than the market wanted to price it. that helped stocks we regained about half of what
we lost on monday. wow, wild few five days of trading, but that's all in the past the question now is where do we go from here joining us now is david mazza head of product at direction it's been a crazy few days, i'm sure your clients have been taking advantage of it what are they betting on, buying and dumping in all this volatility >> this has been a crazy week for investors to take advantage and understand where the opportunity in investors are taking action in gold that has been a safe haven investors have flocked there they focused on gold mining stocks those companies take gold out of the earth, produce it and sell it to others they tend to have a higher beta to the gold price. that's one area where we have seen the most interest in other cases it's been difficult. >> are they buying straight up gold or doing two and three times bullish bets
>> we offer strategies that are leveraged in inverse etfs. so they amplify the price. this is an area where we've been seeing some of the most interest this is three times the price of gold miners up and down. >> they've been aggressive on gold >> yes >> any sign of that tapering off? >> no. with the volatility increasing and things like energy prices going down, i think investors may continue to see activity in gold >> okay. david, sit tight, i want you to listen to this ray dalio came out with new comments on the china trade war last night he compared investing in china now to investing in the british empire during the industrial revolution or during the height of the dutch empire. >> i believe that china is a competitor of the united states or chinese businesses will be competitors of american businesses and other businesses around the world and that you're going to
therefore -- you want to be, if you're diversified, you want to have bets on both horses in the race >> are you seeing your clients, dave, make any kind of sizable bets on the chinese market >> not yet >> not yet >> yeah. it's difficult to go against ray dalio. he's giving us a long-term view. many investors are focused on tactical trading and tactical investing. with some stabilization in the market, that could be the case >> is there any indication of what people are selling or not buying >> a big area as you noted is the oil and gas space. >> just absolutely decimated >> hammered. along with the price of oil. now oil is in a bear market. the stocks -- >> they're selling off at almost twice the pace of oil. normally they track with oil the point we were making is that the stocks sold off -- oil is down 30% this year effectively the stocks are down 60%.
>> yeah. >> so they're dumping it willy-nilly. >> it's rare to see versions like this we put together a chart, and this gap is one of the widest on records. investors, when they see that, they have not stepped in yet a lot of it is the price ofthe companies betting that the oilcn >> so clients going long and strong gold, not paying attention to china yet and ignoring oil and gas good stuff >> thanks for having me. your top corporate story right now is disney an certainly the force not with earnings. shares are down. and star wars is party to blame. >> disney down 3.2% right now. the company missed analysts estimates by 40 cents. revenue came in short also of
forecasts. disney is blaming costs related to the integration of fox's entertainment assets which it bought in march. while the company broke records with "avengers: endgame," that was offset by fox's "x-men" dark phoenix which flopped. bob iger addressed the poor performance in an exclusive interview. no, it's not more challenging. more costly? clearly the results of some of the businesses, notably the studio were disappointing to us. i don't know if you consider that more costly i guess that's the right way to put it but we knew in buying these assets which are global in nature and large, significant in nature t nature, it would be complex in terms of integration we were undaunted by it. >> disney continues to spend heavily on its direct to consumer or streaming business they expect to report a 9$900
million operating loss in this quarter, wider than estimates. disney will launch disney plus in november and iger announced subscribers can sign up for 12.99 a month, that's on participant with netflix and amazon prime also notable, the company says the opening of the "star wars" galaxy's edge area in disneyland cut into attendance at its theme parks, and some guests stayed away because of big crowds >> nobody goes there anymore, too crowded apparently thank you very much. we are just getting started on "worldwide exchange." china keeping invests on edge. currency the focus we'll take you live to beijing. then new concerns this morning over the safety of the tesla model 3. one government watchdog taking a closer look. and have investors found their match? we'll explain when "worldwide
welcome back here's how your money and investments are setting up for wednesday. stock futures are quiet. up a few points, down a few points this is a big difference from what we've seen. the bond market remains a source of action. bond yields falling once again, seemingly insatiable demand for u.s. government debt that gets bought yields come down we're at 1.69% on the ten-year going back to china, once again china trade taking a bit of a back seat to the currency market once again china's central bank taking steps to steady that currency as the world closely watches that key 7-1 to the dollar level eunice yoon is live with more. >> thank you very much beijing continues to send a strong message that it will not use its currency as a weapon in
the trade war with the united states, at least not for now the authorities here were managing and guiding the markets in order to hold the level of the yuan up. and just the way the currency works here is that the pboc every morning sets the value at which traders can buy and sell the currency as a way to influence trading. first thing this morning in the mainland chinese market, the mid point was set at 6.999 to the u.s. dollar. just a bit stronger than 7 currency reports were saying about how the chinese state banks were intervening in the markets, both here onshore as well as offshore in order to support the currency this is another standard way in which the government tries to control and influence the value of the currency. this move follows a statement yesterday by the chinese central bank's vice governor who said
china believes it's their responsibility to keep the yuan stable so there's been a lot of debate here about what the motivations of china are it's becoming clear two days out that the authorities here want to make sure that they don't see their yuan moving in any destabilizing or rapid way >> has there been indication there's been an impact on chinese companies given the wild currency moves >> well, it's definitely boosted confidence among the factory bosses who i talked to they say they're locked into long-term contracts, so there's not an immediate effect, but they're happy about the direction of where the currency is going there's been some interesting chatter amongst them when they say that there is reason, economically, for the currency to continue to weaken. so they're backing up what the government has been saying, this is driven by market forces
but, you know as well as i do that the government here has a heavy hand in the currency markets, in the stock market, as well as the economy on the whole. so they kind of have a credibility problem when it comes to that line about allowing market forces to influence the markets. >> that's the weird irony, we're labeling china a currency manipulator because the currency drops, but if it's being manipulated, it's probably being manipulated on the upside, business owners there want it to fall and it's clear the market wants it to fall >> yeah. it's funny because on social media there were comments to that effect, that this might have been the one day when the central bank didn't intervene or wasn't manipulating the currency and was allowing it to fall, then they got slapped with this currency manipulator label >> eunice yoon, always a pleasure see you soon thank you. still on deck, it has been a
rough 2019 for that stock. but is a weight about to be lifted it's your mystery chart. we'll give you the name and news ahead. and watch out, tesla government watchdogs are reportedly asking questions about the safety of the model three. key details on the latest tesla twist next hing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. healthier brain. better life.
good morning, chicago. 4:20 there in the morning. let's get a check on some of the other big stories. u.s. safety regulators sending a cease and desist letter to tesla last year over claims it made by the model 3. the national highway transportation safety administration is citing a blog post saying the model 3 had the lowest probability of injury of any vehicle tested by the agency they say that's inconsistent with guidelines and subpoenaed tesla for more information on several crashes involving that model 3. match group reporting better than expected second quarter numbers and forecasting third quarter sales above estimates as its popular tinder dating app attracted more users. and shares of ww, weight watchers, are surging today. the company's second quarter earnings topping forecasts,
revenue did come in short. but it is hiking its guidance for the year weight watchers says trends improved through the quarter as it saw a positive response to the new spring campaigns straight ahead, we are tracking the global rate race to the bottom three more countries cutting interest rates overnight where does that leave us and then the downside of keeping your life savings in a shoe box under the mattress. literally just wait until you hear what happened to one couple but unlike most news these days, it has a happy ending. stick around ♪
welcome back it's kind of a relatively steady day for stocks dow futures down about 4 points. perhaps the market wants to take a brief breather after what has been a roller coaster five days of trading let's check on the other top headlines outside of the world of money and business inchewedinginchewed i including a big sign of how jumpy everybody is in the wake of these mass shootings. >> that is the case. good morning president trump will try to play the role of consoler in chief as he visits el paso, texas and dayton, ohio he plans to meet with first responders and system survivors
of the mass shootings that left 31 dead. he may face a chilly reception given his anti-immigrant rhetoric and washington's lack of progress on gun laws. last night chaos unleashed in times square after a motorcycle backfired sparking a stampede witnesses say people were screaming and crawling over each other after confusing the loud sound with a shotgun there were a number of bumps and bruises, but nobody was seriously injured. they say one man's trash is another man's treasure an organ megon man says his wife threw out a shoe box containing $23,000 in cash. by some miracle the money was found 200 miles away at a california recycling facility and still in the box, all but about 60 bucks was recovered and returned brian, whoever took the 60 bucks they said, eh, we'll leave the
other 22,000 we'll take the 60. >>finally a story with some good news. it feels so good to have good news thank you. don't leave your money in a shoe box either on the other side of this short break, hedge fund billionaire ray dalio comparing china to industrial age england. what he said that's got some scratching their heads but first gold doing something it has not done in six years why this year has gold bugs partying like it's 1998. we're back after this.
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the bulls trying to battle back after five crazy days of market moves we'll tell you what's in focus. the u.s. versus china. why one well known hedge fund manager is backing beijing. and call me -- maybe details leaking on the new samsung phone, but get ready to pay up to the tune of nearly 1,100 bucks. it's wednesday, august 7th you're watching "worldwide exchange" on cnbc. ♪ >> you want to hate the song, but it's catchy. i mean, i have to admit it
welcome back thank you for being with us on cnbc happy wednesday. i'm brian sullivan it has been a topsy-turvy week we're only on day three. the dow down 767 points on money. then up 311 yesterday, getting about half of it back. here's how things are looking right now. it looks like maybe the market is exhausted, like a boxer in the corner, just taking a seat for a round, not throwing punches. dow futures are basically flat right now after we have seen multiple hundred point moves nearly every session over the last five. in bonds, they're not taking a break. once again almost insatiable demand coming into u.s. government debt. bond yields come continue to come down. bonds up, yields, the ten-year at 1.68% now you may think that is very low historically for the united states it is. but consider that nearly 15 trillion worth of government debt around the world, countries like japan, germany, denmark,
switzerland, they've gotten negative interest rates, so on that basis, u.s. government debt returns something which is anything let's check the asian markets right now. hong kong rose very fractionally the reason we mention that is by rising 0.08%, it broke a ten-day losing streak. the longest for the hang seng since all the way back in 1984 other markets slightly down. european markets looking good. the dax and the french cac both up more than 1%. the biggest story outside of equities generally in the trade fight has got to be oil. more importantly the continued collapse of oil and gas stocks oil down right now it fell again yesterday, both here and overseas oil deeply now into bear markets. that has slammed oil and gas stocks one of the biggest etfs in the group is the xop an oil and gas exploration etf it's down 12% in a week, and 48%
in a year. in fact, the average return on a stock of a company operating in north dakota, one of the higher cost regions is a loss of 64% in a year that's the average, some are more we'll do more on this collapse tomorrow here on "worldwide exchange" and seascnbc three more central banks around the world culti incutting inters overnight, india, new zealand and thailand you may not care about their central banks or financial markets, could this be the start of what is a global rate race to the bottom which could involve us, the ecb, japan, and even china? joining us now to talk about this is derek halpenny from muhg i know you're a currency guy, but currencies are based on interest rates three more central banks cutting rates. the royal bank of australia, a lot of speculation they could
cut. do you believe that we are the beginning of what could be a global rate race to the bottom >> certainly looks like that the comments from governor or from the rbn were very, very clear and indicating that the rbn is making preparations for the implementation of unorthodox monetary policy, including negative rates if we are at the beginning of a more pronounced global downturn, when you have the ecb who have yet to raise rates in the cycle since the great financial crisis, it's clear we're going into territory that is pretty much unprecedented. the spread of negative rates is likely to widen further as we move forward >> yeah. you're talking about the royal bank of new zealand. larry summers came out and said he believes the financial
markets globally may be sort of on the shaky -- i'm summarizing -- on the shakiest ground since just before the financial crisis would you agree with that? it's a strong statement. >> it is a strong statement, but certainly if we continue along the road that we are currently on, by that i mean a further escalation in the u.s./china trade conflict, i think in that backdrop, given where we are already, it's likely we are certainly going into a global situation like we have not seen since the great financial crisis that spells trouble for currencies across the world versus the u.s. dollar that's where we're likely to see more complaints from president trump, because it seems likely that the dollar is going to remain very elevated in those circumstances. >> he can complain, but do you
believe there's any situation out there where the u.s. dollar is going to fall when everybody is talking down currency or actively cutting rates >> i think it's very difficult unless there's reason forev the fed to become more aggressive in the implementation of monetary easing in the united states. the best we can hope for is more dollar stability around current levels rather than any currency weakness despite, you know, the currency manipulation move, the announcement from the white house and the u.s. administration you know, it lacks credibility to a degree to be citing china as a currency manipulator. and unless you have credible policies to takal u.e tackle ur strength, the likelihood it we'll go forward with a strong dollar >> china de facto is a currency manipulator, but the irony is they're probably manipulating to
the upside, fixing that peg at 6.96%. it doesn't matter what they fix it at. the bottom line is that they are fixing it, but the irony is that it would probably drop a lot more if it wasn't fixed. >> exactly and the complaint of the trump administration is not entirely consistent if you rewind back to say look at mexico or to a lesser extent canada, dollar/mex shot higher, and the free-floating reaction to the risk of tariffs is for that currency to adjust weak tore offset that lost competitiveness. that ultimately is what is happening in china so it's fundamental, as you said, if china did step away entirely, it's likely that you
would see dollar shoot higher than where we are today. >> the chinese currency might fall, making their exports more competitive, negating the impact of our tariffs here. it's an interesting global currency world thank you very much for joining us despite the ongoing trade war and what could be potentially becoming a currency war, ray dalio says he is bullish on china and says that investing in the world's second biggest economy now would be like investing in the u.s. during the industrial revolution >> i believe that china is a competitor of the united states or chinese businesses will be competitors of american businesses and other businesses around the world and that you're going to therefore -- you want to be if you're diversified having bets on both horses in the race >> joining us now to talk about
this and everything else going on in the world is john rutledge and jimmy pethokoukis from the american enterprise institute. both are cnbc contributors john, i'll start with you. ray dalio bullish on china ll . long-term. do you agree with that position? >> there's conflict between now and the long-term, but you wouldn't want to bet them being big and much higher incomes for the middle class in the long-term. that's right it's a treat to work with ray and jim. we have not seen each other in a while. china has a mess right now china and the u.s. is another mess but they are a juggernaut. right now i don't want any money at risk in china i would get clear of it. i'm in love with cash right now.
>> that's what i guess is so confusing about ray dalio's comments viewers may or may not know if you're a westerner you can't buy chinese equities, you can buy the hong kong shares, but the "a" shares you can't buy you need a domestic agent, and you can shot short stocks there. i don't know why he would recommend investing in an economy with controls that are so the opposite of what our system here has been, that has made him a billionaire >> that's right. if you let yourself think long enough, the controls have actually been relaxed over 10, 20, 30, 40 years in china. likely they would be in the n future i think ray is saying middle class incomes in china are driving the entire consumer economy there now.
that's where the profits will be over the next 50 years, china and india more than other places between now and then you could get your feet shot off if you're not careful. >> jimmy, our viewers may not care about the new zealand central bank, the reserve bank of new zealand, but they cut rates, india cut rates overnight. is this a global rate race to the bottom larry summers noted that this is the most shaky and nervous the financial markets have been globally since before the financial crisis where do you think the united states falls in all of this? >> listen, i think it is a dangerous situation. if this trade war escalates, we go with a 25% tariff on all china trade, the president said he could take it higher, that's a dangerous situation. one way it reminds me of the financial crisis and we may not fully understand all the economic and financial linkages, so this is a static analyses
that will chop 0.3 percentage points off u.s. gdp growth, i'm not sure about that. but just one thing, ray dalio's forecast, his forecast to me says he believes that china's centrally planned economy, which doesn't seem to be moving in a more market oriented direction, is an economy that can be on a technological frontier in the 21st century, rather than the united states? i'm skeptical of that. >> i don't think you're the only one that is. jimmy, i guess the question is this, how does this trade fight end up do you see an end to it if there is an end at all to be had this year or maybe this will be kind of one of these pre-election surprises where suddenly everything is resolved right before the -- a couple months before the presidential election next year and stocks take off. >> i think given the mercurial nature of president trump you can't write off that option.
he may declare victory and we'll go home sometime in 2020 then there's also the long war, the cold war scenario. is that possible i think it is. before you bet on there being a long trade war between the united states and china, you have to see the president actually talk about it in those terms, which he has not. i think you have to see allies getting on board i think you have to see the american public be made aware we're in it for a long-term and there will be pain none of that happened. if i had to bet, i think this is not a long trade war or a u.s./china cold war. we could see a resolution in 2020 >> john what do we bet on? gold is soaring, bitcoin has done well. u.s. treasury bopnds, 15 trillin globally stock market is nice, but right
now maybe is cash king >> you said it earlier the fear is driving the money into the dollar and into the bond market. that fear has a lot of causes right now. all the way from the russian riots to the hong kong riots to the venezuelan riots, many others many stories out there they will not likely go away all of that made securities overpriced when bonds get overpriced, stocks get overpriced. private equity gets overpriced you end up with things later on you look back and say that was a bubble a bubble happens when prices get too high and then all at once people somehow lose confidence the he lehman moment was the loss of confidence in 2008 >> sorry to interrupt, but do
you think we're in a bubble right now? the number of shares in the stoechl contin stock market continues to shrink do you believe there is or are bubbles out there? >> absolutely. prices are crazy right now when it falls apart, it's when the network fails. network is like the electricity grid, when it fails all at once, the lights go out and you say what happened? what could cause that now? one would be a supply chain interruption with parts that come from china to taiwan to mexico to the u.s., going wrong and you have to shut down factories. that's not as likely what's more likely is you have a financial network shut down. what would cause that? in may there was a bank taken over in china. the chinese corporations have huge amounts of dollar debt. when the renminbi drops, the weight of the dollar debt in the renminbi goes up those same companies have
enormous amounts of shares pledged as collateral for bank loans. it doesn't take much of a fuse to unwind that thing when it does, capital leaves china, the renminbi goes down and we end up with more of these brain freeze incidents like we had with president trump this week with the imaginary currency manipulation that was terrible -- that was a terrible thing that happened this week. >> all great points. jimmy, last point to you you talk ed about currency manipulation, we are back below 7-1 on the chinese yuan to the dollar we saw what happened on monday, stocks fell. we're not seeing a reaction in the futures right now. dow futures are fractionally higher if china is a manipulator of its currency, it doesn't appear to be doing a good job. >> they can only manipulate it or stop manipulating it and let market forces work so long because they're worried about
capital flight issues. if the chinese currency is easing, look for more tax on jerome powell. >> absolutely. >> it is easing back now we're back below 7-1 we'll wait for the tweets today. thank you very much. great stuff. >> thank you coming up, the story everybody around here is going to be buzzing about today. why a big part of the big apple was taken over by bees yes, bees. it's probably the end of the world. and trade turmoil and your money. the three things you need to know now to navigate this escalating trade war we have real money advice coming up next. could lead to way cleaner teeth. she said, get the one inspired by dentists, with a round brush head. go pro with oral-b. oral-b's gentle rounded brush head removes more plaque along the gum line. for cleaner teeth and healthier gums. and unlike sonicare, oral-b
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last time i saw you we were talking about disney let's do it again. for months we've known about disney plus, but now we know how much it will cost. subscribers who want disney plus alone will pay 6.99 per month or 69.99 for a year the company announced a new bundled option which would bring viewers disney plus, hulu and espn plus for 12.99 a month. samsung is set to unveil its latest smartphones at an event today in new york. there's likely little surprise because most of the promotional materials have been leaked these are photos of the galaxy note 10 and the 10 plus. bad news for anyone hoping to stop that whole $1,000 phones thing. the note 10 will start at $949, and the 10 plus just short of 1,100. and the nypd boasts nearly 40,000 officers, included in the
ranks is a squad of nypd beekeepers they buzzed to the rescue this week to remove 25,000 bees to safe relocation. >> 25,000 bees i got it the police set up a sting. 25,000 bees in the staten island ferry terminal >> apparently they're needed they don't want you to swarm or swat at them >> who will swat at 25,000 bees? >> there are people. you know there are people. bee people, i guess. >> or not bee people >> either way, i went to the website droid life, not what i was expecting. it was a phone thank you very much. on deck, a miss for the mouse. disney disappointed. that stock is down we'll tell you why coming up.
then we're jumping back in the "worldwide exchange" time machine. what happened the last time we had a big chinese currency slide? it wasn't this week, it was a couple years ago we'll show you it's your morning rbi, it's random and interesting we got it coming up next it's show time. let's cowboy up! exhilarating speed. woo! precision control. woo! maximum reliability.
welcome back time for your executive recap. shares of disney under pressure, down 3.5%. earnings and revenue falling short of wall street expectations bob iger blaming the miss on the ongoing integration of fox's entertainment assets which disney bought earlier this year. facebook sued two asia-based app developers for what it calls
click injection fraud. facebook argues those developers installed malware on phones with the intent to generate fate clicks on facebook ads and hong kong-based airline cathay pacific said ro testspros hurt airline traffic and negatively affected future bookings let's get back to the markets and your money stock futures are higher right now, about 40 points a relatively calm morning considering what we've been seeing joining us is michael purves last five days have been bonkers. currency moves currency manipulation tags trade war escalation if we see a calming of that in the next few sessions, cha wiwhl drive us from here >> i'm not sure we will stay
calm for too long -- >> i said if >> there may be short-term volatility exhaustion setting in people have seen, you know, a lot of drama things are getting overbought or oversold there's something now that's didn't investors have to confront three questions. one, what is the effectiveness of fed policy to offset trade. >> is there an answer to that question. >> economically and the markets, i'm guessing it's less than some people might think it is some people in d.c. perhaps. the second question, what is the chinese response there's been a given by the markets that trump can push and push and push, then if he wants to, he can suddenly, you know, basically come to the table and agree. we don't know that the chinese
are always going to be doing that and the third is for some time we have never seen every single major economy in a state of dissent. we've seen the u.s. go into crisis, europe okay, china strong then you sea euroyou saw europe china and u.s. in the recovery -- >> now everything is shaky what do we do? >> it's hard you have to be careful of cash allocations right now. cash still has a yield on it i think that's one obvious thing. i'm yoef weigoverweight on the s metals >> you're the guy buying gold? >> silver yesterday. the gold miners and silver have
leveraged to the gold price. that's a thing now you don't put your whole portfolio in those assets, but i think that's one way to think about it i think there will be dip buying i don't think that dip has to get bought in august >> a notoriously volatile month. take a break for the summer. come back in september you like gold and silver >> yes >> appreciate it time for your morning rbi. let's talk history while we haven't had a trade war-led selloff in recent memory, we have had achinese currency-led drop. it's easy to forget in the short-term world that in august of 2015 china's currency fell. so did stocks here in fact, the s&p 500 fell by more than 5% it was volatile the entire month. after the drop the low on the s&p 500 just under 1900. now almost exactly four years
later, we're at 2881 that's a gain of 50% it may be different this time giving a different president and a trade war, but recent history said big currency led drops are not always the end of the investing world. that's random and hopefully interesting. see you tomorrow "squawk box" begins now. good morning we have news breaking, china taking steps to stabilize its currency we'll get a live report from beijing on that issue and how it is driving this wild week of trading. and the man behind the world's largest hedge fund with a new call out on china. this is ray dalio, he says you is a rare opportunity to invest right now. and bob iger blaming fox and streaming costs for disney's earnings miss. we'll show you how wall street is reacting. it's august 7, 2019. "squawk box" begins right now.
♪ live from new york where business never sleeps, this is "squawk box. >> good morning. welcome to "squawk box," we're live at the nasdaq market site in times square. i'm melissa lee with andrew ross sorkin our guest host for the full show, tom farley, former nyse president and current chairman and ceo of farpoint. after yesterday's bounce, we had a 1.2% gain on the s&p 500 a bounce on the dow. it looks like we will extend those gains today. s&p 500 higher by 5 points dow looking at 37 at the open. nasdaq up by 34. in asia, the hang seng eking out a slight gain but not enough to break a ten-day losing streak, the longest down stretch since 1984 shanghai comp down a third of a percent.