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tv   Making Money With Charles Payne  FOX Business  October 11, 2019 2:00pm-3:00pm EDT

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benefit if we calm the heck down with the trade front from the chinese. they're all benefiting. interest rates picking up. who needs to worry about federal reserve interest rate cuts. we'll still worry about that. for now a deal could be at hand. now charles payne. charles: we want our cake and eat it too. neil: if you have a cake, eat it. charles: if they have a fed you might as well cut rates. neil: absolutely. >> i'm charles payne. this is "making money." breaking out trade talks with china about to come to a head. in moments president trump meets the chinese vice premier at the white house. as new reports say there is partial agreement with beijing. the united states may be on the verge of a better economic relationship with china, america companies are doing big business there. they are doing big soul-searching. the moral cost should be the bottom line. if you're on social security, listen up. more money may be coming your
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way. will it outweigh the rising cost of everyday living? that and much more on "making money." ♪ charles: president trump set to meet face-to-face with the chinese vice premier in the oval office in less than 45 minutes. the markets rallying over reports that the u.s. achieve a partial agreement with china. here is deirdre bolton. reporter: the idea that the market is rallying or partial deal. two moving part i hear from our sources is most likely. the first, as of tuesday, october 15th, the u.s. had already cleared for to us put an additional 5% of tariffs on chinese goods. $250 billion worth on the 15th. so taking them from the current level of 25% to 30%. so our sources are telling us, more than likely the u.s. will just hold steady at 25%.
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not raise them to 30%. if that happened, that would be seen as a act of goodwill from the u.s. side towards the chinese side. now one thing that has already happened, but certainly important for u.s. businesses is that the chinese securities regulatory commission has said as of january 1st, 2020, so next year, if a u.s. financial company wants to set up a firm on the mainland in china, that firm will not be forced into a joint venture with a local chinese company. charles, you know this, almost better than anybody in the sense this is how the i.p. theft happened. this is really at the crux of this u.s. trade tiff, u.s. trade war as we can now call it. is the theft of ip from u.s. companies to chinese companies and it happened because they are forced to go into the joint ventures with local companies. i also think a secondary component, charles, it actually weakens hong kong's place in the world. as we know most western banking
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institutions set up hong kong as basically their asian hub. if you take that attraction away, you hurt hong kong's ocala economy as we know basically has been in protest from pro-democracy people since march of this year. those are a few of the moving parts that we're watching. i know that you have all the latest how it is affecting markets. from here, semiconductors and all big techs moving higher. charles: deirdre, thank you very. what does the high-profile meeting between president trump and vice premier of china about prospects of agreement ultimately take us to the big, big deal? could it happen sooner rather than late? we have liz peek, brian wesbury and heather zumarriaga. let me start with you, liz peek. soybeans, probably also would be added in there. they have already been buying them. the financial nojv, currency,
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suspending tariffs. how do you feel this is big sea shift that moves toward a bigger deal when ultimately that happens. >> i agree. pushback from the people, he didn't get the chinese to change their way of life or chinese move away from all intellectual property theft, all joint ventures, et cetera. there is going to say that this can't be a staged deal. we don't start with backing off from increasing tariffs, which is a big deal, for businesses in the country, the night, they want to see certainty. i think if we just say no more tar riff increases. also the chinese aren't going to do this. that's big. you forgot to mention pork. they are buying american pork like crazy. they have to because their herds are down 30% that is a breakthrough and good for american farmers. charles: heather, steve mnuchin says the market is always right about anticipation of great big
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news. everyone is waiting. key component from the market perspective, liz hit on it, suspension of tariffs, october 15th, september 15th tariffs. we get that monday and open higher or will this be anticlimactic? >> this is a monumental deal even though in my eyes it is not a trade deal yet until president trump and president xi address it, president xi of china to address it. remember last time they went back and china reneged on the 150 page draft agreement that we had. i do acknowledge they are buying more agricultural products from us. so that is good. we need to have some sort of acknowledgement from china side, when the vice premier goes back in order for me to really believe that this is as monumental as it may sound. charles: to that point, brian we learned early on in the week the vice premier didn't carry additional title of special on very. so he can't cut the deal. this gets back to something
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you've been pointing out. commentators pontificated who is winning, who is losing, you always said it is china really suffering the most and maybe there is why a greater sense of your again system remember early in the week president trump took serious actions against them, blacklisting 28 companies, stopping visas to other countries. it has been maximum pressure from the administration all week long leading to this day. >> yeah. what president trump, i'm kind of reading his mind and also watching his actions -- >> you can do that? >> he want china to stop stealing intellectual property. to stop demanding higher tariffs in the rest of the world to come into the world trading system as equal partner. follow the rule of law and trade fairly. it is always darkest before the dawn in these negotiations. threatening to delist
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1.2 million of chinese companies. iftar riffs, if you want to go down this road, we'll hurt you even more. china is hurting. exports to the u.s. are falling. vietnam, mexico, taiwan, canada are all up. we have trade deals with mexico, canada and japan. three out of the top four trading partners of the u.s. when i look at this, canada, or china will be left behind if they don't come to the table, come to the table and make an agreement. so i think trump wins on this i think that is what is happening right now. charles: let's talk about this rally. every sector is up. it may be counterintuitive, technology is not the biggest winner today. in fact material stocks up 2.6%, the sector. industrials up 2.6%. financial up more than financials, i mean technology. liz, this is amazing. the market is reacting to this and other news in a way that suggests maybe this could be beginning of a longer-term
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rally. we've gone through the lull. we hit highs. >> look, if you buy into the idea, i think it is true that this china confrontation hurt our manufacturing sector, has caused a real downdraft in world trade, those are the stocks really responding. as far as financials are concerned, look basically upward slope of the yield curve, that increased every single time we have close to getting a deal. why? economic growth around the whole would lead presumably to higher long-term rate. i think the market is jumping ahead of itself perhaps here. we don't know the terms but i think it is very important to remember, this is not the only tool we have in the tool box. i totally agree. we also have the world -- the world trade organization. we have been very aggressive pursuing disagreements with china through the wto. there are other things we can do. let's get tariffs in place. move ahead with increased trade between our two countries. that will free up a lot of energy around the world.
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charles: took 15 years for the world trade organization to determine airbus is being subsidized. >> we have pursueded charges against china. charles: we win in those courts but we don't win anything because they don't have enforcement. heather, that is the key, how do we enforce this deal? critics will say all of this is fine and dandy. a, we can't trust china. who will push back on that. b, where is the enforcement mechanism? >> that is what i was saying. i'm very optimistic over this. i think markets rally on optimism and partly on the fact people were if you were short ahead of the meeting, they're covering shorts into the weekend thinking there wasn't going to be suspension of the tariffs. we got that. that is the key for treasury secretary steve mnuchin i think as well as u.s. trade team. how are they going to enforce china not stealing our intellectual property? that is the key. >> point you made, if we have the majority of these joint ventures are not forced into
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them at all, that is good way of not having them to through the files. real quick, brian, consumer sentiment number out today was absolutely phenomenal. what caught my eye, negative impact of trade went down from 29% of respondents to today. what is it about the american consumer they seem to be more smarter than everybody else? >> unemployment and wages are accelerating at lower income levels. if you look at consumer spending on just goods, move services out of there, it is up 8.7% at annualized rate this year so far. so if companies are out there going, oh, no, we're uncertain about china, we're not going to produce, guess what, inventories are going down. that is one of the reasons gdp has been weak. they're falling behind. charles: right. >> these companies are not listening to their customers saying everything is fine.
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i think this is sentiment. a deal, by the way enforcement mechanism, charles, is that their exports are falling. their economy is getting hurt worse than ours. >> supply chains are moving. >> that's right. that is why their economy is getting hurt. >> pressure from hong kong. charles: they don't come back. thank you all very, very much. you know what? they told me we'll have a super a block. it wasn't long enough. very much appreciate it. later in the hour why the social security raise touted by the agency is nothing more than really a sad joke. you won't be laughing. while president trump is set to meet with china's vice premier this hour after a week of trade talks. there is growing concern about u.s. companies caving to china. do we need a morality check? golden state warriors coach creating shockwaves around the world particularly in america he compares china abuses to american misconduct. the comment you will be shocked once you hear them. we'll be right back.
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companies need a morality check when it comes to doing business in china? i want to bring in former mcdonald's usa ceo e there was a piece in "the new york times," i'm rarely in agreement with them, it was compelling saying dealing with china is not worth the moral costs the things we thought would happen for china over the last few years, china miracle of bringing so many peasants into the middle class, masked human rights abuses and other things we're learning about. what do you think? >> it's a complex matter to say the least. my last visit to china was to shanghai to visit a snap-on tools plant when i was on their board of directors. there is a lot of progress being made in china. i think the world engaging with china is a good thing long term but we have to be very cognizant of the fact it's a communist country. when mr. kerr equates some of the civil problems we have in this country to a government that opresses its people the way
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china does and backs over student in tiananmen square with tanks hardly the same thing. but having said that i think we need to engage china and do exactly what trump is doing, hold their feet to the fire. keep them on their heals, thinking about the best way to do business globally. charles: to that point toe, again, steve kerr, very high-profile influential person in this country with this sort of, this false equivocation but americans will see this, it is going to be regurgitated, that we're no different than china. that's mine boggling if that is what businesses are going to do to justify doing business there, rather than saying we know there are problems and we're trying to change it? >> you know i think steve's comments were ill-conceived. if he had to do it over again he might have said it differently. passion sometimes gets in the way of common sense. the reality of it is, the united states is far, far, far better to its citizens than china is to
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theirs. i think the more we engage them in commerce and cross-cultural activity, the more they get to understand who we are, and what we are. the more we understand them, better off the world is going to be. charles: yeah. >> the last thing in the world we need to do is go to war with china on any front. charles: by the way you give steve kerr a lot more credit than i do. it took him 48 hours to come up with that plan of attack if you will. believe in something even if it means sacrificing everything. famous words from nike which took on president trump, this administration, suggested that america was as racist now as it was 50 years ago, but they blinked in china. removed all the houston rocket gear from all the nike stores. you served on boards and run some of the biggest corporations in the world, what would you tell the nike board now that they may be doing wrong? >> clearly you can't be the morality judge and jury for everything that goes on in the world. make sure your own house is
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clean first. make sure the people you're denigrating deserve it and not undeserving. we have a great country here. you may not like president trump but he is our president. he is going to be our president. we need to support the constitution of the united states. we have a great economy, great citizens here. let's quit hating each other and being so at great things we do. if i was on what are you guys thinking? why are you doing this? how does this advance our cause with our company and our economics. charles: amenned ed. always good to hear from you. particularly on this day. thank you very much. >> bye-bye. charles: brexit, the deadline is coming fast and furiously. the eu agreed to intensify figure shuns with the uk. after a constructive meeting with british prime minister
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boris johnson and his irish counterpart. meanwhile your 401(k) getting a nice boost today. the same can't be said about social security benefit. why is the social security administration bragging about the increase? that's next. ♪ imagine traveling hassle-free with your golf clubs. now you can, with! no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. saves you time and money. make it simple. make it ship sticks.
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charles: retirees set to get a cost of living increase of, 1.6% this comes to $24 a month for the average social security recipient. that is basically a joke, inflation reported yesterday up 1.7%, food up 1.8%. medical care more than 4%. joining me policy director iwf hadley heath manning. they put out the tweet, hadley with pride. guess what, 1.6%. don't spend it all in one p a m.
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not just for folks on even think it will be there. certainly won't be enough to provide kind of living sy stance? >> that's right. social security is not a great deal for today's seniors and especially for future seniors, future retirees. the 1.6 cost of living adjustment is standard. the social security administration looks back at every year for urban wage workers and cost of living adjustment is based on that figure. not based on other inflation numbers you mentioned. medical inflation is very high. seniors have the benefit relying on medicare which is much better deal for seniors in terms how much they take out versus how much they put in but if we can't get serious giving today's workforce the ability to save for retirement. we have to do it privately, not through the social security system which is essentially a ponzi scheme. charles: it's a ponzi scheme when it was developed. most people don't realize the
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average woman think lived to 60. the average man lived to 58. the idea from the architects, put it out there. stave off this move to socialism, particularly in germany where bismarck came up with the idea. never have to pay it out. things have changed. it is considered the political third rail. if we don't fix this, how can we fix any part of our budget issues? >> that's right. social security and medicare payments make up about more than half of every dollar that the federal government spends every year. if we want to get serious about reforming federal budget, reducing the national deficit, reducing our national debt in the long term we have to talk about so-called unfunded liabilities of these programs. that is mismatch how much is going in versus how much is going out. not just because people live longer. that is in many way as blessing to live for longer life. we haven't adjusted for the difference in longevity. we haven't adjusted for differences in population growth. we're have aging population, we
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don't have the same family size or fertility rate or same number of workers in the workforce in terms of ratio to retirees. addressing that i believe ultimately will have to depend on lawmakers being bold enough, saying, listen if you're in the current workforce, talk about ways for you to have more control over your health care dollars, medicare, reforms that give people greater choice. this is what the trump administration is trying to do through the executive order they issued just days ago. also changing social security so people have more choice over that money. personalized accounts is sort of an idea that came and went. i believe it was unfortunately sort of an idea that got neglected and never really got acted on. we have to give people more flexibility. it's a huge burden, especially for lower wage workers to pay into social security. it is one of the biggest line items comes out of their family budget in terms of taxes, social security payroll tax. charles: apparently starting in
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january, a widowed mother with two children will go from making, $2889 a month to 2935 bucks a month. that is a couple of uber fares. it is so fascinating. do you think we're like some other issues that we know, just can't continue indefinitely, that we're going to have to hit a brick wall one day and go over the proverbial cliff? or do you think there ever will be political will to truly address this? >> unfortunately in a two party system it's a zero sum political game. every time someone proposes bold changes, former house speaker paul ryan who really positioned himself as budget reformer an entitlement reformer. people don't like to refer to social security and medicare as entitlements, but by law people are entitled to the benefits that is why we call them entitlements. look at the treatment he got. he was figured pushing a
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grandmother over a not proverbial cliff but real cliff. this is what you get when you talk about the long term solvency of these programs. charles: hadley a pleasure. >> thank you. charles: market up on the ahead of the meeting between president trump and chinese vice premier. how high will the move in trade take the markets? stay with us. i think we have some answers for you. ♪. orlando isn't just the theme park capital of the world,
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♪ charles: stocks on a tear right now, trade hopes progress and pretty soon president trump will be meeting with china's vice premier. in fact in about 50 minutes. china trade delegation along with the vice premier arrived at the white house. i want to bring in sarge 986 president steve guilfoyle and managing director of clear shield advisors jim awad. jim, i want to begin with you. you've been having skepticism, guarded optimism about the whole thing leading up today. are you surprised we're hearing about reports of at least this amount of progress. >> absolutely surprised. it was headed in the opposite direction. it was getting more antagonistic, more nasty in terms of words. something happened somewhere that has to do with politics where trump decided this is, in
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his best interests for 2020. and in fact, for the moment probably is. it is a complicated -- it will be a benefit to the stock market, benefit to the economy. therefore benefit to his political standing. charles: do you think it could have, jim, something to do with economics particularly china's economics? these numbers that have come out of china in the last six months have been really ugly numbers and these are the official numbers that they can gin up? >> i should have addressed that in my previous comment. both sides need to come to the table to make a deal and i think the chinese have been interested in making a deal for a time. they have got their own economic problems, problems, got issues in hong kong. and trump, trump was the one who kept saying that the chinese want to make a deal, i'm not ready. his calculus is, that the consensus is that the current level of tariffs, the economy can handle. but if you went forward from
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here even further, burden them it would really start to hurt. i guess he made the calculation as we chronologically roll into the recession, the damage would happen with a lag, it is better for him to stop the bleeding right now. so both sides, based on what we know, you never know with this president, anything could happen in 15 minutes. but based on, logic is he wouldn't have gone this far prwise unless he was convinced that he was going to have a positive announcement to make. charles: steve, one of the things we saw was the huge delegation arrived a couple days ago which was completely opposite what we were hearing in the media. they weren't interested. they were offended. blacklisting of 28 companies. they were cutting it short. it should have been gone yesterday. there was negative immediately yaw build up to this, moves by china, they were buying more soybeans. they were already being a lot more positive in my mind about all of this. i'm not necessarily surprised
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but i'm reluctant to call this a deal. i think this is an inflection point. i think it takes us towards a deal a lot quicker, the tone is better and wall street obviously loves it. >> the tone is better and wall street loves what is happening today. what was happening is the pomo or the false fed qe they laid out, 60 billion-dollar plan that will focus on the short end of the curve. charles: tell us about that in more lehman's terms. i've been talking about that. that was announcement got very little press. >> that is huge in terms of what is going on today. the 60 billion a month will target t-bills, only short-term debt. they can compress that side of the curve while trying -- charles: what jay powell promised a couple days ago. this is not quantitative easing quantitative easing? they're printing money. >> permanent open market operations. what it does it allows purchasing managers to move forward to get slightly more aggressive with capital
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expenditures. thee month is basically invert the for the first time since may. charles: two and 10 were relatively flat. now they're going back. jim, to that point, some economic yellow flags, not red flags. inverted yield curve gone. we saw consumer sentiment reunder booed today. maybe business confidence started to rebound, does that suggest to you, what we're seeing in this market could be justing the beginning? a one-two punch may be big news on china, big news on the fed, a year-end rally? >> and brexit looks like it is getting a little bit better. charles: right. >> it absolutely speaks to a year-end rally. we have one hurdle. that is earnings, when they start coming out next week. forward-looking guidance. now the expectations are very modest for down 4%. it is likely they will be beaten. if the forward-looking guidance is reasonable and positive and the tariffs haven't done too much of damage, i think we could, not only have a year-end rally, make modest new highs in
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the markets between now and december 31st. charles: that is music to my ears. gentlemen, thank you both very much. trade of course, we'll talk about that some more. stocks are trading on this optimism about a, some sort of a major, major agreement today. as president trump is about to meet with china's vice premier. it is important to remember this is not a deal. it is an inflection point in talks. it will make the tone better. make the compromises to help us get to the ultimate deal. it's a deal the united states has needed for many years. we'll be right back. ♪ usaa took care of her car rental, and getting her car towed. all i had to take care of was making sure that my daughter was ok. if i met another veteran, and they were with another insurance company, i would tell them, you need to join usaabe they htter rates, and better service. we're the gomez family... we're the rivera family... we're the kirby family, and we are usaa members for life.
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the day we'll finally get some♪ ing done. ♪ ♪ ♪ ♪ ♪ ♪ ♪ charles: breaking right now, crude just closing moments ago up to 43.70 a barrel. that is a dollar increase -- 54.70 a barrel. iranian state tv said two rocket the struck an iranian tanker traveling through the red sea. the dow is up on reports that the u.s. reached a partial trade
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agreement with china. ahead of president trump's meeting with china's vice premier set to begin a few moments at the white house. gerri willis live on the floor of the new york stock exchange. tell us about the buzz down there, gerri. what's going on? reporter: traders are focused like a laser on every headline out of washington a guy who walked out of the trade delegations, chinese guy walked out of delegations five minutes early in the morning that took 15 points off the s&p 500. the stocks are moving on these headlines. moments ago i got a report from dan ives at wedbush, a analyst, well-known tech analyst. he said this is a major game-changer if we get the partial deal. you will see the tech stocks rally. and that it will be especially important for apple. speaking of apple. apple shares are higher here. 235.84. what i last saw. 235.89.
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235.88 is the all-time high. if we close here this is all-time high. it is trading at a trillion dollar market cap. people like it. there is a lot of risk too, if we don't get some kind of deal, by that any ol' deal, they're not even requiring a thorough going deal, any skinny deal would be fine by traders t would mean a five to 10% bump on the dow. if they don't get that we'll see 1000 point selloff. that is what i was told. most stocks leading the dow higher. charles, back to you. charles: gerri, thank you very much. claim -- "the claman countdown" host liz claman will have a special guest next hour. >> they are taking profits now. see the stock down 3%. earlier, yes you were right, charles. generac, the home generator company, that puts up generators, makes sure you guys
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out there that invest with them are not without electricity. that stock hit all-time never-before-seen record high. we have ceo first on fox business. 3:00 p.m. eastern. you know, in california what's happening is that they are doing intentional rolling blackout due to fire safety and scariness of issues. we remember what happened last year with the paradise fire. that is in part what is driving this company's situation at the moment. people are saying we don't want to be the victims of for example, electricity company pg&e saying we have to cut off your electricity for the moment because it doesn't spark a fire. we know what happened a year ago. fire situations are been devastating. that is big win for generac. we're looking at the trade. charles: i recommended this stock on this network 10 years ago. >> you did. charles: called it the mack daddy of generators. they have no competition.
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i cannot wait to see that. liz, that will be good one. thank you very much. >> trade meeting happening in our hour. charles: make sure you watch claman countdown 3:00 p.m. on fox business. president trump meanwhile is about to sit down with china's vice premier in the white house in just a few moments. what needs to be discussed and what needs to be agreed upon and this is a make-or-break meeting. you cannot overhype that. we'll be right back. having your clubs lost or damaged by the airlines. sending your own clubs ahead with makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. saves you time and money. make it simple. make it ship sticks.
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charles: markets still riding high with the hopes we'll get some really great news today with respect to the china trade front. the big meeting between president trump and chinese vice premier happening as we speak. i would like to bring in dean chang from the heritage
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foundation. there is a lot of anxiety what this means. i haven't heard the term it is a deal i think it is an agreement but i think it gets closer ultimate to the deal that could be beneficial for both sides, dean what do you think. >> i'm afraid i'm much more pessimistic. as you said there is likelihood of an inflection. i think we'll probably going to see chinese agree to buy more in the way of agricultural goods. not in order to settle the trade difference, frankly they need more soybean and pork because of problems inside of china's internal food production. the big sticking points all have to do with intellectual property i don't see how liu he or anyone short of xi xinping basically will order the chinese to respect intellectual property rights. lighthizer, mnuchin, ross, all said this is the thing that is preventing an actual deal. charles: you know when this battle began last year i remember watching a major event
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in china. i forgot which one it was. it was just, there was the most amazing ceremony with rows and rows of i guess leaders and otherwise and i remember president xi coming and saying that they were going to respect intellectual property rights, not just of foreigners but also of chinese companies because i understand there is a growing pressure within that country itself to have greater rule of law, greater intellectual property rights because they're creating their own intellectual property now? >> that's true but i would suggest that what we are seeing with regards to, would you go to china with your personal laptop, your banking information, your passwords on board? i mean i'll tell you right now i wouldn't. charles: to be honest, most of these major corporations have gone there knowing they were going to get ripped off in a faustian deal for access to 1.2 billion people.
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if you know that understanding to a degree you will get ripped off, you get some protection maybe not total protection because there is always going to be some sort of stuff going on anyway, wouldn't it increase the likelihood of china actually getting more business? made in china 2025 may be off the table but i think it was off the table anyway with respect to the timeline. >> with respect to the timeline that is probably true. again i don't think the chinese have said oh, we'll not try to dominate global production in everything from microchips to railway locomotives. charles: we had a foreign minister last week who said they didn't want to play "game of thrones." america is number one economy in the world, foreseeable future. that was lip service, huh? >> i think that the chinese understand that lanister was kind of dumb, she would tell everyone what she was going to do. charles: how excited in your mind, when you compare what you
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know, is this market in your mind overreacting it to this or optimistic, cause to have some relief that at least things are moving in the right direction? >> i think that the market is as, you have said, looking for any positive sign at all. i think that the chinese gdp numbers which i believe are due out tomorrow are going to probably be kind of sobering if those numbers are anything short of 6%, which they might well be. the big question is going to be what comes out of this meeting, also where are we going to be on the real issues of intellectual property protection? because, again, i think the chinese can say, the fact they're not even willing to try an pull a sersi here, sure, we'll respect intellectual property trust us, gives you an idea how hard it will be for them to actually respect them. charles: dean, great talking to you. appreciate it. >> absolutely.
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charles: we're heading into the final hour of the week. the dow, s&p, on track to snap a three-day losing streak. investors will find out what is exactly happening between president trump and china's vice premier. we'll be right back. ♪. driverless cars, or trips to mars. no commission. delivery drones, or the latest phones. no commission. no matter what you trade, at fidelity you'll pay no commission for online u.s. equity trades.
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charles: all right. stocks rallying in a big way now, snapping that three-week losing streak. investors hoping for a breakthrough from the white house, where president trump is right at this moment, folks, meeting with china's vice premier. to help us figure out where we are heading not just in the final hour of trading but perhaps maybe the rally, let's bring in scott martin. scott, you have been very cautious. by the way, you have been spot-on. you went bold at the right time. but now it feels like maybe this market's breaking out. what do you see, handicap it for us. >> yeah.
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the action looks good today, from the standpoint of look, you're right, we have been a little cautious lately and at times during the year, buying gold, buying currencies to kind of hedge out equity risk which we still had on, but you know, the market's still not, to me, in that breakout stage yet. 3025, if you are really playing at home, is the level to look at in the s&p to convince me we are going to move pretty much forward from beyond moves like this today, and i got to say, i really like the interview that you had previous to me with mr. chang from the heritage foundation with respect to how china can be trusted in whatever deal is put together. i think we can get some steps here, we can get relief on some of the tariff threats, but are we going to get that total intellectual property kind of trade secret stealing deal? i'm not so sure about that. charles: but is wall street as concerned about that as perhaps politicians and businesses are? it feels to me that wall street itself is just sort of a sigh of relief. we saw consumer spending, i'm sorry, consumer sentiment was
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absolutely phenomenal. the way consumers now see low inflation forces the fed's hand. the amount of money that consumers think they will make in the next year is at a 20-year high. it's never been this high. they are going to continue to drive this economy and the fed's going to cut rates, businesses might start to feel better as well. >> yeah. the fed comments are great, because i think that's really kind of one of the underlying forces here. now we've got a fed that qe4, qe4,000 now. the fed doesn't want us to call it qe, like ll cool j. don't buy call it a buy-back, o whatever is said. the fed are doing qe whether they like it or not. you're right, they are going to cut rates at the end of the month here and i really think that's what the market is liking. i think it likes the fact the fed is really coming to the table, to your point, rightfully so in a really benign but yet
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growthy -- benign inflation environment but nice growth environment as well. charles: one thing no one is talking about is that materials and industrials, they are the biggest winners today. tech is doing well, but here's the thing. maybe these calls for a manufacturing recession could be premature. we have a number that's considered a bellwether, 3200 outlets in this country, they know what manufacturers are doing, they beat, it's the best performing stock in the market, one of them. what about the idea of looking for value? manufacturing, materials up 2.5%, industrials up 2.5%. if you're looking to buy this market, if you want to perhaps be positioned before this breakout happens because once it happens, i think there will be a sense the train iis leaving the station and people will be frustrated. >> agreed. if you have upside you want beta, you want that kind of really outsized exposure. deere is another one we talked about all year that i think was
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overly done to the downside. that's another area industrial-wise, construction-wise, they could get a benefit from. yes, if you believe that this type of news is going to continue to flow, i believe we are going to get a suspension on some of this tariff talk at least for now, for the tariffs set for october, probably the ones in december as well, you are probably going to see some lift in those names. materials and industrials, forgotten as the train pulled out of the station, probably jumping on now is a good idea. charles: so timeline, perhaps we will get a suspension of the tariffs that were going to come online and will also hear mnuchin, lighthizer will go to china, maybe that sets up a meeting between president trump and xi, you know, that seems to be the timeline, throw in there fed rate cut. if the market keeps going up from here, it's hard to keep pushing back, won't it be more difficult? we only have a few seconds. i just wanted your thoughts on that. >> yeah, it will be tough. i think seasonality, you have nice seasonality coming up as we go into a strong holiday season which will be supported by a
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really strong consumer. charles: all right, my man. i noticed the suit. looking great. looking really good there. >> you're the leader. i'm just trying to catch up. charles: thank you. we always appreciate your wisdom. we are near the highs of the session, 481 points. liz claman, up to you. liz: did you guys notice the nasdaq, 8,100 today? oh, my goodness. we love those round numbers. we got one now. thank you, charles. will it be a deal? will it be a truce, a breakthrough? have you heard this one, an early harvest agreement? whatever it is, this is the hour it may happen. right now, right there at the white house, president trump and chinese vice premier liu he are meeting face-to-face. yes, the chinese delegation arrived just three minutes ago. will it be real change to the contentious trade relationship between the world's two largest economies, or just a tension-


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