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tv   Power Lunch  CNBC  August 24, 2017 1:00pm-3:00pm EDT

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target. >> cisco is bouncing back from the post earnings down trend. >> western digital looks like they'll come out on top with toshiba. i'm still there. i still like it. i still think it's going to go higher. >> josh brown? >> alphabet holding support, staying long. >> thanks for being here thatdoes it for us "power lunch" has more on hurricane harvey and the interview with paul ryan. >> here's what's on the menu, a very busy two hours ahead. taxes, health care, the threat of a government shutdown and trump agenda we have an exclusive interview with house speaker paul ryan just minutes away. and retail rally, abercrombie & fitch soaring, dollar tree, and others riding high as well is death by amazon a bit overdone bracing for the bit one, harvey just declared upgraded to hurricane status, barreling towards texas now. we have the very latest on its
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path and what it could mean for the people of houston, the home of the biggest refineries in this country "power lunch" starts right now >> welcome to "power lunch." i'm courtney reagan, as tyler mentioned retail flying high but stocks trading in the narrow range. fed chair yellen and top central bankers meeting in jackson hole. we'll head there live. hormel foods missing earnings estimates and cutting its outlook. j.m. smuker tanking on its earnings miss. >> thanks koscourtney the president taking another swing at republican leaders on twitter, including paul ryan for failing to get things done how does paul ryan feel about
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the presidential jabs. ylan is getting ready for her one on one with the house speaker. >> reporter: paul ryan keeps trying to talk taxes but the president has other ideas in those tweets he was blaming both paul ryan and mitch mcconnell for making a mess of this debt ceiling fight. paul ryan just wrapped an employee town hall here today at boeing, speaking with employees as well as boeing ceo and during that town hall he said he is in close contact with the president. we jokingly said he takes it day by day we'll see if we can find out more from him and get his response in a few minutes, guys. >> should be a very interesting conversation so much to talk about with paul ryan coming right up. harvey upgraded to a hurricane just moments ago it is barreling towards the texas gulf coast this picture taken by one of noaa's satellites a short time
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ago. that's me, showing how massive the storm is trust me, it's massive there it is. the energyindustry closely watching hurricane harvey with a third of refining capacity in the path of what is a rapidly intensifying storm jackie deank lis has more. >> good afternoon.
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a little bill less than half of the nation's refining capacity at stake when you take the whole gulf coast into account. if it's a category one, it takes a week to get back up and running. category two more like two weeks, energy markets are not in panic mode crude oil is down today. natural gas are modestly higher but traders who recall past storms tell me prices will move very quickly if this storm packs a bad punch. this summer of course crude has been under $50 a barrel because of the oversupply situation. down almost 8% in three months in fact. the expectation was that prices would move lower after labor day, of course this storm could be a game changer if it is as bad as expected. traders are saying we will top $50 again in crude back to you. >> thank you very much there's a lot to watch and a lot of things changing in texas with
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harvey thanks retail in focus today. guess what, this time it's no t mostly good. the parent of kay and jared and others, saw growth in all businesses, raising guidance e commerce improved and mother's daytiming helped too shares up sharply for shares of signet, quite a turnaround but it's one quarter. >> they saw sales increase that's tremendous, right when you started the earnings season, you told us the expectations nobody would -- >> the comp sales are the numbers we watch closely and that was the really big surprise last quarter they were down 12%. this is a big swing in the other direction. there's a lot of things going on new ceo. this is one we have to watch closely. pretty big pop though. >> what does signet own. >> zale's, jared, kay, piercing
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pagoda. >> they own your husband, jared? >> tiffany is another jeweler different demographic but still posting stronger than expected profit and revenue, comparable sales did disappoint so those were lower still the jeweler reaffirming guidance and trump tower security not hurting the new york flag ship they pointed that out specifically said softer tourist spending is hurting -- >> wait a minute, they are right next to trump tower which i saw get shut down a couple of days ago when he was in town last week i mean, i find it -- or are more tourists going there because trump tower is there >> the security has not been that bad he's never been there. >> right. >> it's not that heavy on a normal day. >> and melania is not there. >> they said it returned to normal, the traffic returned to normal but they called it out specifically because they've called it out for opposing
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reasons in the past. it's something important for them to know anyway, sales down for that one. >> very different from tiffany dollar tree. >> total lly different outperforming consensus across the board, raising the forecast and managing to lower costs and lower promotions but without hurting sales. 38 straight quarters of comp sales growth for dollar tree they've got over 14,000 stores they only close something like 34 they have dollar tree and family dollar they serve both a suburban customer and rural and urban customers and food was really strong, family dollar and everything is strong at the dollar tree. >> seems to be working. >> really is. >> and retailers seeing some improvement, abercrombie the latest to outperform the street's expectations this morning. two main brands, hollister and flag ship. the name sake abercrombie comps did fall 7%.
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they still warn the environment is challenging and promotional but they've been undergoing a lot of strategies, not the least of which is remodeling stores so the perfume smell isn't quite so strong they are lighter, not as dark as they used to be. they are making und fmtal -- >> the hollister stores are very dark they have the video of the beach -- >> and the waves. >> i like that. >> california surfer brand feel. >> what you see through all of these is that the expectations were beaten so low that if you beat -- look at the pops today, 15%, 15%, 11%. tremendous if you manage -- >> i don't think we're out of the woods for retail so many things to worry about. amazon is still a strong player. and folks are not going to the mall as much as they used to but the strategies are maybe starting to take hold. some green chutes. >> thank you, courtney. >> they call it the woodstock for central bankers. every year they descend on jackson hole, wyoming, except i
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don't think they get really muddy and dirty and don't do a whole lot of drugs and maybe steve can tell us. hey there, steve. >> you just ruined the metaphor and took it so far you go into the mud and drugs and it doesn't work. when the fed gathered bee neej the tetons, they worried about recession and global crisis, somewhat better this year but issues are still pressing. let's look at what i call the official and unofficial agenda the first is about global growth we have major economies growing for the first time in a decade new leadership if the president does not reappoint janet jelen and draghi, winding it down early next year? fed keeps missing inflation
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forecast and the balance sheet reduction. kansas city fed president says the fed has been clear that reduction in the balance sheet is coming soon >> you saw the minutes of the last meeting, markets are expecting any time now looking at september and out that is always a function of what issues are going on when we meet to make that decision i think the setup is there describing how that would happen and the approach that the committee would take >> less clear is the outlook for another rate hike this year. the fed continues to miss that inflation forecast, robert cap lynn said that gives him pause >> the issue as you know is about inflation and i think really trying to weigh the conflict between the cyclical factors which should be creating more inflation, although with a lag and structural factors like globalization and technology that are muting pricing power of businesses i'm not saying that we won't act
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by the end of the year i just want to be -- i think we have the ability to be patient here and see more -- see how these forces unfold. >> a lot more coming up out of jackson hole glenn hubbard in closing bell. dean of business school there and potential fed official maybe one day. the fed president and kay powell to talk about the issue of global growth. back to you guys. >> that's tomorrow for jay powell on power lunch. >> that's right. i should have said that. >> i jst waust want to make sur. >> woodstock was three days and we're only doing two days of coverage. >> but i'm sure you brought your guitar. >> you should have brought your band >> i've got my guitar, small travel guitar gets me through the monetary policy papers i have to read. >> you love it
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what's the biggest factor for the markets? janet yellen's speech in jackson hole or president's push for his agenda where he threatens government shutdown or debt ceiling or something we don't know about yet let's bring in sandy co-manager and chief investment officer of atlantic trust mr. billery, was the biggest threat >> yes way you slice it you're going higher after we get through tomorrow and figure out everything, i believe you've got to unwind this $4.5 trillion balance sheet and maybe it's $10 billion a month or something like that ultimately rates will go higher. we're looking to play more offense and trying to buy smaller cap domestic stocks that are frankly down -- only up 1% this year with the s&p up 11, i think they've got a lot of catching up to do with the dollar increasing. >> why do you like small caps in the face of potentially rising
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interest rates >> the dollar is down 10%. as we get into the fourth quarter, if you get any sort of political rhetoric or debt ceiling -- get through that, get that resolved, the dollar will go higher and interest rates will follow and maybe we'll get better moves out of small caps rather than larger multicap multinationals. >> what do you think is the biggest risk >> i don't think it's right in front of us, but i think over the next several months, people maybe underestimating activity from the fed in terms of the pace of rate increases i think that again not right in front of us but as we look to 2018 we may begin to see the inflation indicator tick higher and market complacency may go away and people will start to price in more increases. >> one of the things, dave, that hangs over this meeting in jackson hole is what will happen with chair yellen. does she want to be reappointed? how much of a market factor is
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that likely to be as we move into the fourth quarter? >> i think it will be pretty important. what i expect to hear from chair yellen tomorrow is first kind of a subtle victory lap because this could be her swan song, point out how stable the economy was since she took over. it's difficult to know i would lean towards the camp she doesn't get reappointed because when president trump has a change versus continuity decision, he usually favors change >> sandy, your nouthoughts how big a factor is chair yellen's future in the direction of the market or would you expect whoever succeed her with continue or sell rate a higher interest rate policy and acceleration of reducing the balance sheet? >> i think rates are going higher one way or the other. i think one way or the other if it's not 25 basis points this
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year it will happen as we get into 2018. the economy is too robust, even though we're not at that 2% inflation target, 1.7% for the last -- >> you expect a rate hike it comes in september not december? >> they would say only a 25% chance -- >> in september? >> in september. but as we get into december -- >> 40% or something. >> 40% we have a shot at getting one in 2017 for sure. >> dave, we're convinced we have a brand-new viewer for sure, somebody who won $700 million because now they have to figure out what to do with the money. where else would you turn but cnbc what's your best idea for that person >> first i would say celebrate then the second thing i would say is don't do anything rash too quickly. don't start spending and giving money away indiscriminately. sit back and think long and hard how you want the new found wealth to change your life and family's life and what you don't want to change
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and find a trusted adviser to work with. portfolio mix, diverse fiction would make sense, you don't need maximum growth or be super conservative some equity and fixed income and real assets, long term investments like private real estate, private equity and so forth should also be important. >> a lot of -- >> we're showing this live picture where they are about to announce the powerball winner. give an idea, stock idea >> i was going to say the first thing i would do is hire a cpa, then you want to try to find a good money manager, somebody with a long history and help you diversify and do well with those funds. a couple of stocks i do like, sky works solution is one i'd like and i would put some of the money into sky works, 40% semiconductor supplier to apple, 10% to samsung as each iteration of the iphone gets more and more complicated
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and smarter as people download more data and streaming and video, more content per phone is coming from sky works. as we get into the iphone 8, there's going to be higher units, 250, 275 million units, you get the double whammy if you will. >> we were showing western digital and financial engines. thanks so much. >> good to have you on. >> thank you coming up "power lunch" exclusive interview, the debt ceiling, trump agenda. so much to talk about. and mr. trump's jabs at republican leaders like him. paul ryan joins us next live "power lunch."
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stocks have clawed their way back in the last hour and a half or so and right now they are positive but but only ever so much .79 points on the s&p 500. look at the various sectors there today. real estate is the leader, up almost a full percent. followed pretty close by by
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health care energy among the laggards, utilities and industrials and technology and consumer staples stay with u. speaker paul ryan will join us after this break.
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quote
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welcome back to "power lunch. let's get strit to ylan standing by with paul ryan. >> thanks for joining us on "power lunch". >> good to be here. >> the president went after you
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today on twitter and said he had asked you and mitch mcconnell to attach a debt ceiling increase to the va bill and you didn't do it -- >> i don't take it as going after me that's an option we were looking at but the va deadline came up and we weren't able to do that then i'm not that worried about this. we have plenty of options ahead of us. we will pay our debts and make the debt limit, hit the increase before is penetrated, meaning we'll pass a debt limit increase, plenty of options. that one wasn't available. >> does it include a clear hike in the debt ceiling? >> i'm not going to negotiate to the media but we have a lot of options in front of us not worried about getting this done, we will pass the increase before he hit the debt limit. >> the deadline comes a day before the government funding deadline comes you said yesterday you're looking at short term solution through december. >> the senate has double duty.
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they have to pass personnel, meaning judges and appointments and ambassadors and subcabinet officials so the senate is slower in the first year because they have all of the people to process. we're going to finish our appropriations in about a week or so. it will take more time for the senate to process these bills. i would anticipate we'll have to have an extension so we can process all of these bills with respect to the border security, i think what's that you're getting it. we passed the funding for the border security. thats something we feel strongly about and think it's very necessary. to make congress work we'll have to have an extension because the senate is also doing double duty on making sure the president gets the people he needs in his administration >> all the time that is spent on this funding fight, on the debt ceiling negotiations, that's less time available for talking about tax reform -- >> not really. >> is there time to get this done in 2017 >> you keep saying that.
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>> we can walk and chew gum at the same time. here's what i'm doing on tax reform criss-crossing the country talking about tax reform last month i was at new balance in massachusetts i was at miller brewing in milwaukee. national association of manufacturers in d.c., yesterday in portland with intel, today here at boeing talking with the american people about the need to reform the tax system we haven't done it since 1986. it is a big drag on growth in america. we all know this i've been working on this pretty much my adult life, tax reform this is something we're all in on, we're solely focused on it and our tax writer, ways and means committee are deep into the details producing the bill those who are leaders can multitask and work on funding and debt limit while the committee of jurisdiction works on getting tax bill ready. it's the way congress works. lots of committees and lots of p pots on the stove and stick to landing, no pun intended this
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callen der year. >> the president seems to have other priorities at this moment. do you need him to be actively out there stumping for tax reform >> he is >> we have a shared agenda the president and congress we are eye to eye on this agenda and on these priorities. i've spoken to the president more times than i can remember how we agree on getting tax reform done. this isn't one of these issues where you have a difference in priorities between the house and senate and white house we're totally on the same page on this. i think there's kind of a much ado about nothing there. we all agree we've got to reform the tax system, raise wages and increase economic growth, more productivity, better competition for american businesses who are really have their hands tied behind their backs when it comes to competition in the tax code we all agree with that we're getting on common ground to move forward to get this done
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this fall. yes, we have a lot on our plate and we've got to process all of these things and that's what you do in congress, you multitask. >> steven mnuchin has said when it comes to tax reform, permanent is better than temporary but temporary is better than nothing, do you agree with that? >> sure. first of all, permanent gets you the kind of planning you need. a company will not make a million year multibillion dollar investment if they are unclear what the tax commitment will be in the future. we believe perm nens is very, very important the big provision making decisions those have to be permanent. there are other things that can time dates to make sure the numbers work but the big mac co-economic policies that stuff has to be made permanent the other point is there are some who have said because of our budget process we might want to go temporary. it doesn't work that way we do believe it's got to be permanent and something the ways and means committee is passionate about, permanentan
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works. >> if it's permanent, you have to work with democrats to get it passed or pay for it. >> reconciliation is the better way to do. we've already shown and demonstrated we can show reconciliation people say won't tax reform be tougher? it's the other way around. the problem on reconciliation with health care, reconciliation is a fiscal tool but health care is regulatory and fiscal we can only put our fiscal policy onts bill and all of the other things we couldn't put in this piece of legislation. with tax reform, the entire tax reform goes into one bill, one reconciliation, 50 votes in the senate that makes this so much easier and more importantly we as republicans are really on common ground i do believe there are democrats that agree with this, get our rates down, be in favor of expensing. everyone generally speaking who is in the middle and right of
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center is for this that's why we're going to get this done. >> if you use reconciliation that means a tax reform bill wouldn't be able to add to the deficit. when you think about the pay force, that's the hard question. at boeing many want to bring the rates down but don't want to get rid of the goodies. >> you have to get rid of loopholes and broaden the base to lower the rates this will be no different than that more importantly we have a tax system written in 1986 for the 20th century and well into the 21st century and rest of the world is passing us by we're really -- we have such an anty quaited tax system that dropping rates without fixing the actual system would nort be nearly as growth producing system that cuts works for workers and families and businesses you need to clean out the old garbage to get a tax code wired
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for growth look at these planes this company is taxed at 35%, their kpcompetitor in europe 25% -- >> i'm sure they want to hold on it the r and d tax -- as well. any that are off the table >> we'll let the tax writers do. that we don't like to do this in the media. we're confident that we can have a regood pro-growth tax system enduring and permanent so that big businesses and small businesses can make good long-term decisions and that's why perm nens matters. >> you also mentioned you want to encourage people to own a home, save for retirement and donate to charities. on the personal side are those things not going to be touched at all. >> those are three we want to emphasize. you can improve the policies by cleaning these up. we have a lot of redundant reductions -- we've already said
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in the house and senate agreed with this, we do want to have preferences for things like charity and homeownership and retirement savings how exactly you structure that will be left up to the ways and means and members of congress. but the point we're trying to make is those are important things that are broad based for all american families and workers. when you raise the standard deduction, that dra matdically simplifies the code so much that even with the three preferences, you could have a postcard sized tax reform that brings tremendous fairness and kplisty, more importantly by consolidating the brackets, we're cutting tax rates so they can decide what to do with it. it's good for families and workers and economic growth. >> it's complicated for people to understand when they look at the tax return at the end of the year the deduction is so popular and so essential to so many people,
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how might that be -- you're willing to let -- >> i won't get into differences on that, only that we recognize and acknowledge and believe you need to maintain the mortgage interest deduction, whether it can be improved in how it works that's the discussion we'll have in an ongoing basis and what the ways and means committee has their process for. the point being we'll maintain those critical things because we think they are really important. homeownership, charitable giving, these are things everybody needs to do and wants to do in conjunction with dramatically simplified tax code and lower tax rates and cleaned up irs that's what people want to see and what we ran on and what we'll deliver on. >> talked a couple of times about the importance of a territorial tax system how do we get there if border adjustment is dead >> when i was ways and means chair, we were talking on income tax territorial then went to the -- we agreed in the house, that the border adjustment wasn't ready for prime time.
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we don't have the necessary political consensus we need to do that. weefd already agreed we'll go back to income tax reform. you can go to a territorial system with income tax and many other countries do that. we know exactly how to do that and the best way to do it is a one time tax on overseas profits when you tax it once at a low rate. >> mandatory. >> mandatory across the board. that means you reset the system and pay for the conversion from a worldwide to territorial system we've refined this proposal that ways and means finance committee, microrefinancing this process. the deal is you tax overseas profits once and it's done and all of that money is deemed repaidiated and from there out you have a territorial system which we think is critical we have $3 trillion in trapped cash overseas that can't come back because of crazy tax laws that will help economic growth. >> final question for you, kevin brady said if you don't get tax
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reform done in 2017, it wouldn't be the end of the world but could it mean the end of gop control of congress? >> we made a promise and ran on this said this is necessary i think we have a word to keep and we have to keep our word and i feel as strongly as kevin does about that. >> any chance democrats will come on board with you >> i think some will those who are -- >> in the senator house? >> the bernie sanders warren wing of the party, they won't touch this, but i think there are going to be more moderates coming from states that are manufacturing states like north dakota and missouri or indiana, some of them will come on board and support this because this is common sense we are shooting ourselves in the foot as americans with our tax system it's high time we liberate ourselves and get a tax code built for growth and competition. i do believe there will be democrats who will come on board. >> thanks for joining us. >> back to you guys over at "power lunch".
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>> thank you very much speaker ryan, thanks as well let's get reaction to what we just heard from cnbc senior contributor larry kudlow and senior foel low at the center of budget policies. you know each other, don't you, you've met before? >> we have larry -- >> we go way back. >> since a lot of what is being discussed here has philosophical roots, what did you hear there how heartened are you by what sounded to me like a very optimistic and determined speaker ryan >> i liked a lot of things i heard. i like the competition, the growth, we're going to have to make changes i like the idea of bringing the repatriated money back home. question is, regarding reconciliation, we'll probably disagree, jared and i, but the administration is putting out 3% growth baseline for ten years.
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the cbo is 1.9 the differential there is $3 trillion of revenue. tax revenue. >> that's correct. >> so i believe they should stick to that. ryan's budget committee is 2.5 -- >> 2.6 >> right that's -- i want deficit neutral. i don't want revenue neutral i want 3% growth to go into that -- >> into the forecast. >> into the forecast because that's what they base it on. i want spending cuts to go into the deficit calculation, right, it's all part of one package and reconciliation as far as the ten-year horizon, this goes back to this bird rule that used to be -- when i was down there in onb, two to three years, five years, then ten years, could be 20 years i don't care about that. >> it's a custom not a law to say we're going -- it needs to
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balance over ten years. >> by the way so the economic growth assumptions in the law it does not say the cbo assumptions have to be used necessarily. so these are details but they very important details by the way, the more revenues you get from the growth component, the less you have to have the painful deductions which can take god knows years to work out. >> jared, what did you hear there, he was pretty explicit though a little vague about the mortgage interest deduction? he said we think there should be preferences for that for charitable donations and retirement but the exact shape is to be determined. i'd like your overall thoughts and particularly your thought and larry's as well, where are we going to see something? >> well, first of all, on the mortgage interest deduction, i used to talk to joe biden about that economists don't like that it's pretty inefficient and one of these subsidies for people
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who don't need it. whenever i talk to biden about doing something about it, obviously a firm democrat, he reminded me i couldn't get elected dog catcher. and i think the point there is that this is an extremely heavy political lift and even though it may not be great tax policy or social policy or housing policy, it's pretty entrenched as ylan was emphasizing. on the growth and budget process stuff, i want to sort of translate some of what larry is saying and he'll be okay with that because we've been fighting about this for a long time i don't think the growth effects were anywhere near realistic you want to write them down, go ahead. i don't think cbo -- sure they won't engage in the kind of dynamic scoring that larry likes to do in his head. therefore, you really need a plan b what if those revenues don't show up as they never do because this trickle down stuff doesn't work. >> come on. >> secondly, i just want to
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correct -- don't want to fact check paul ryan, interesting interview. i do want to correct one thing though, he pointed to boeing and said this place pays a 35% tax rate that's patently false. you can look at the records, they paid essentially zero in taxes if they claim losses from 2000 to 2014 most recently paid 23% i'm not saying the corporate tax code isn't a hot mess. it is. you can't tell me that multinationals are paying 35%. they are not. >> some of them do the effective tax rate versus the marginal tax rate, that's an old saw -- >> true for individuals too. maybe pay 39% on my last dollar of income -- >> corporations don't pay taxes because they don't make any money. that's the issue there. >> 2000 to 2014. >> i would say the growth formula worked in the '60s under kennedy and 80s and 90s under ronald reagan and bill clinton
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here's though just to get off this, if you double the standard deduction, which is in the trump plan from the campaign right until now, then 90% of those people -- the income level would be about 60,0$60,000 mary filin joint jointly, you don't have to worry about any deductions and that's the postcard scenario that i think works so well i think doubling the standard deduction is absolutely crucial. and i think ryan has been selling it, been terrific, agree with that. give him high marks. nobody in the senate is selling it at all. kevin brady is selling it. i want the president to sell it. i want the president -- at these rallies and whatevery want to relitigate charlottesville and don't want to relitigate the health care vote in the senate i want to go on and move to tax cuts and economic --
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>> jared, speaker ryan focused very much on homeownership, charity, 401 ks and did not talk state and local taxes. >> good point that that sounds like that's going to be where they find a lot of the money. >> you know, he's going to have some problems there, not just with blue state governors. that is a really unpopular idea with a lot of his republican friends. paul ryan and to some extent larry, made tax cuts because we're talking tax cuts made it sound easier than it is. they don't seem to have a plan yet. your question about when will we see details is a good one. maybe in a couple of months and by the way, as you guys have argued with me before and have a point, the dysfunctional president, the chaos in the white house doesn't preclude them getting their tax cuts. the problem is i really don't think they are going to be able to pony up the pay fors and loaded up on the deficit and
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forget about perm nens. >> i'm make one prediction. >> growth is the pay for it. we disagree but -- >> what's your plan b? >> what if you don't get the growth let me hear plan b. >> i will agree with this, the white house should lead. she should out their new plan and president trump should lead because he is the guy who will sell this. >> i will make this prediction with ult eutter confidence, it leak before it's released. thanks very much. >> thank you. >> coming up, check out macy's stock, down about 40%. it's dividend yields, around 7%. earlier this week around 8%. should you buy that because the yield -- how do you know when a high dividend that a company is paying is really going to stick around the warning signs you need to watch for straight ahead
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hey. pass please. i'm here to fix the elevator. nothing's wrong with the elevator. right. but you want to fix it. right. so who sent you? new guy. what new guy? watson. my analysis of sensor and maintenance data indicates elevator 3 will malfunction in 2 days. there you go. you still need a pass.
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fidelity, where smarter investors will always be. hello, everyone, i'm sue r herre herrera. parts of charleston have been put on lockdown as police investigate an active shooter situation. local reports say an eyewitness saw a gunman go into a store on the popular tourist street known as king street moments ago police saying the gunman is a disgrund gruntled employee holding multiple hostages police add it is not an act of terror we continue to monitor and we'll bring you an update as events warrant. harvey is officially a hurricane. slowly making its way towards the gulf coast line and expected to dump up to 20 inches of rain
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in the houston area. the state of ohio has found an insurer to offer health care coverage under obamacare for one last county without an option. care source will offer coverage to residents under the federal exchange for next year new study reveals there could be a link between sleep and the risk for dementia. scientists found those who spent less time in deep sleep may have a greater chance of developing dementia later in life that's the news update this hour, new over to rick santelli for the bond report. >> thank you, sue. we're about three, three and a half weeks from the fed meeting that may really give us substance with regard to balance sheet and its reduction. you can tell because if you look not going anywhere two day dollar index not going anywhere they are fighting the whole low
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prices, low price structure for the year if you open it up to one week and one week of the dollar index, it jumps out at you and this is significant, there's a lot of reasons why the dollar was weak and interest rates were 2.44 and 2.63 high this year we're hovering right at 2.20 a lot has to do with central banks. i don't think the pattern will change but every investor is counting the days to the fed meeting and listening to any surprises although it seems few and far between what's going on in jackson hole this weekend michelle and the gang, back to you. >> rick, thank you take a look at the dividend yield on macy's, stock is down more than 40% this year but got a yield higher than 7% earlier this week nearly 8%. not just macy's but nearly all of the names we're showing you right now have very high yields, frontier, macy's and kohl's,
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5.6% tyler and i have personal stories that formed our views on yields years ago there was hysteria about phillip morris because of the lawsuits and the yield approached 10% and several people in my family bought it right at 10% or just below and wow, that was a trade of a lifetime. the company stuck around, the yield actually went up and stock paid for itself in under a decade and then it was just a revenue stream after that. and i look at macy's and wonder, is macy's -- could it be the same thing >> and i have the opposite story. >> you always do. >> i was working for another company and looked at the yield on ibm, i believe it was 9% and thought this is a lay-up, i'm going to buy a great company ibm and get 9% payback at that time interest rates were higher so it was not quite what 9% is today. then of course the stock just
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went down and down and down and the yield -- dividend got cut and cut and cut. and it was probably the worst investment of my life. what we saw there with those -- going back to the wall -- >> frontier -- >> look at the beautiful yields? what do those stocks have in common stock market performance down 70% and 21%. that's in part while those yields are so high that's not a good sign >> how do investors know when a stocks dividend can be in trouble. lets bring david, a firm that focuses on stocks. good to have you here, david >> you heard the conversations and the basic questions, what do you think? is macy's safe >> the last time macy's yield in this level was back in '08
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or '09 we favor dividend growth companies as oppose to yield companies. the yield tends to be high for two reasons. dividends are going up which is a great thing or stocks are going down as tyler pointed out. >> the question, go back to the example, here ace compais a come a lot of investors are getting in trouble by doing that how can you separate the tune up for the chart here what do look at in macy's to say okay, that at 7% is a better bet than something else at 7%. what are the numbers you look at >> we focus on fundamentals and top line growth, in the case of macy's is negative and comparable sales have been struggling the last few years. it has been negative tou you want to look at earnings and
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cash yield growth. earnings in cash flow and power dividend growth. companies are able to generate growth >> while oil got really low like chevron was yielding 6%. a lot of people focus on the dividend pay out ratio how much money does the company take in verses how much they have to pay out in dividends some of those companies got over 100% and suddenly, their dividends costing more some people stuck with those companies because of that. if you look at the dividends pay out ratio? >> absolutely. we looked at the pay shoout rat and see how much they are paying out. in the case of shochevron, it c be temporary if we think the future outlook
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for earnings growth, we'll accelerate and be able to support that we'll be happy with the 10% yield. macy's, they have not been a high dividend yield company. you need to be conscious there >> the other thing that occurs to me. in the examples that we made and gave there it is good to have a product that's either -- >> yeah. >> or a product that's so vital like oil >> right >> and not gdiscretionary like the other one. >> you will always find us at the top. >> a major new development on the amazon deal, that's coming up next.
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welcome back to "power lunch," we had some breaking news at the moment amazon issuing a press release saying that it expects whole foods acquisition to close this mond monday the company received approvals from whole foods yesterday we got some clues to finally what whole foods will look like under amazon customers and suppliers are anxiously waiting.
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whole foods will offer lower prices starting on a selection of staple across the store with more to come it will begin to integrate amazon prime into the whole foods market sales system. when that completes, prime m members are able to access benefits "power lunch" is going to be back in just two-minutes
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speaker house paul ryan weighed in on the tax and shut down >> harvey is getting upgraded, the latest prediction say it could be a category three by the time it makes land fall, we'll get up to date it is the first on camera white house briefing since the beginning of the month we'll carry it live. "power lunch" starts right now
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>> it is a mix picture the nasdaq is the worst performer again today. real estate and healthcare the best performing sectors signet and skjm smucker those are the worst performer in the s & p today. >> cisco and ibm and merck, those are lead ing the dow righ now. take a look at shares of some of the super market names those are falling back on news of amazon. they are lowering price at whole foods. giving discounts to prime members. more details straight ahead. welcome back everybody, i am
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tyler mathisen of the big interview of the day, house speaker paul ryan talking exclusively on power lun"powerl" weighing >> ylan mui is live with the highlights of that interview >> reporter: tyler, speaker paul ryan was here at a tax reform road show trying to talk off potential of getting tax reform done this year i sat down with him just a few minutes ago and i asked him about president trump's tweet that blamed him and senate majority leader mitch mcconnell for making a mess of the debt ceiling fight. here is what he said >> i don't take it going after me that's an option that we are looking at the va deadline came up and we were not able to do that then. we have plenty of options ahead
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of us. we'll hit the increase before this penetrated. plenty of options in front of us that one was not available for us >> do those options include a clear hike >> there is a bunch of options in front of us we have a lot of options i don't know we'll get this done, we'll pass the increase before we'll hit the deadline. >> reporter: ryan also double down on the need for permanent and verses tax forms ryan says that'll be a misopportunity >> we have a tax system written for the 1976 for the 20th century. we are well in the 21st century and the rest of the world is passing us by. we have an anti competitive
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system, it will cut taxes lower for businesses and employees >> reporter: before republicans can start working on the issue, they noeed to fund the government lawmakers will be looking on a short term extension on the funding be ifun funding bill once they get back to washington. >> it will take more time to process these bills. i would anticipate that we'll have an extension so that we can process all these bills. with respect to the border security, that's what you are getting at with the president. we passed that in the house. we passed the funding for the border security. that's something we feel strongly about and we think it is necessary but just to make congress work, we are going to have an extension. >> reporter: so congress will have to face two spending fights once they return from this august recess, guys. we'll see whether or not the optimism that paul ryan had of
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getting tax reform done here in washington state will translate back to washington, d.c. >> it is a big question. lets bring in patrick murphy from florida and ron christie, former special assistant to george w bush what do you think of that? he's optimistic of getting something done are you optimistic, ron? >> the house and senate will find a way to forge compromise of the tax legislation we don't want to take away the mortgage deduction and we are concerned of how much it will cost but, they only to recognize one thing and it is very important we have the largest governing ma majority right now since 1929. i think it really is not good for the republican leadership.
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yes, and i am optimistically cautious that we'll get something done in september. >> paul ryan today said he thought it was possible to get some democratic votes when it comes to tax cuts especially because our business tax structure makes it uncompetitive. is he right about that >> the fact that is we do need to ask tax reforms, absolutely, he's right i cannot say that i share his optimism unfortunately, when the congress gets back in session a couple of weeks, they got the raise the debt ceiling and pass the bud t budget, the russia stuff is not going to go anywhere and other outbursts that we saw are not going to stop going to be a distraction for the president. i wish we are at a time where we can come together to get important things done like comprehensive tax reform
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>> i hear on that, you did not answer the question that i was asking if it got to the moment where something to vote on he talked about the possibility that there will be democrats in states that have heavy manufacturing basis that agrees there is something to be done. if it came to vote, is there possible to see something getting along? >> look, that was in the details. it was in the bill so far the talking point is much different than the actual legislation we have seen president trump truon the trail talking about healthcare for everyone, making sure everyone has healthcare but look at the resolution, you saw something different than that we'll see after the debt ceiling and passing the budget, it is a small cuts for many people and that's something that i don't see democrats are getting behind >> if we cannot actually fix the
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system, can we still drop rates? >> we should and we must given how high our corporate tax rates are. here is where i disagree with the good congressman from florida, speaker ryan have been a friend of mine for 20 years. he has many solid relationships of people trusting him and believing in him it would not surprise me if you found a number of moderate democrats working with the speaker and the republicans to get something through the house, it would not surprise me if you find the senate minority leader, chuck schumer to work with senate republicans to get something done we have a very small window of opportunity. we have 11 legislative days in depth to move a lot of legislation in the house and senate to get the appropriations done to dismiss it and i think it does a great disservice.
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congress is there to do the people's business and that's what they need the do. >> gentlemen thank you so much. >> thanks guys >> lets get over to lesley picker for our news alert. >> here is what we have, mary barra, has been elected to the board of director at walt disney so it does not appear that she's replacing anyone, she's expanding the size of the board to include here. >> back over to you. harvey has been upgraded to the hurricane in just the last hour. it can be a category three now by the time it makes land fall in texas much of the texas coast can experience life-threatening flooding with rainfall as high as 30 inches possible. we are talking of historic level. the storm is heading to the center of the oil refinery joining us is bill mitchell,
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bill, thank you very much for joining us today a lot of focus on the crude complex given the fact that houston is an oil pound and the gulf has so much in terms of crude reserves and refining capacity bob, excuse me, bob mitchell >> yes, good morning thank you. >> thank you for joining us. >> yes, in turn of what we know from previous hurricanes, what can we look at the economic impact to the houston area >> it is $503 billion. making it the fourth largest economy. then if you were to say houston 'alone, we would rank number nine of the entire united states in gross domestic product. it is a big issue for the city of houston in terms of hurricane, the last one it made land fall in texas
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in 2008 and of $30 million in damages. what have we learn from then what's going to be different when this hurricane makes land fall in texas in terms of infrastructure >> unfortunately, i don't think we have learned a lot. we worked really hard and work with our legislatures to fund that to stop the storm surge $30 billion you are referring to, $27 billion was in surge and surge alone. >> so -- >> so we can protect this region, our elected officials they are not helping us to protect this region. >> i have seen estimates of four feet of water. that sounds catastrophic is that possible >> right now the actual number is they're talking to 6 to 10 feet surge. the surge alone and not including the range. >> how long would it knock out,
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for example, a lot of the refining or facilities that maybe in its path. >> if we get two foot of water, those facilities they are harden to about 12 to 14 feet. if we get two feet in those facilities you are talking of shutting those facilities down anywhere from 18 to 36 months again, realize that 27% of the gas produced right here, 60% of the jet aviation fuel produced he here, it is produced right here in the region. not count for the 40% of all the chemical feed stock of the entire united states this year what dhaus mean? everything making plastic bottles to the coding that goes on your capsules and bills a >> do we assume of a slow down across the united states because some of these products cannot get in because there is an energy >> oh, i will tell you it is worth than that. >> it is not a slow down, it is
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a shut down. >> if we get hit, if it land 12 miles further west, we would have wiped out the biggest part of our industry. >> wow >> we are currently, we have $240 billion in asset setting on the ground around the houston h ship handles this is a national issue it is not local. we are the number one export, united states of america >> yes >> the implications are certainly severe >> bob mitchell, much appreciated. >> thank you all right, good luck >> more details on the amaz amazon/whole foods deal with the breaking news. >> reporter: i want to if we can pull up shares of grocery stocks at the moment they are sliding of the latest release from amazon.
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amazon is expecting its whole foods acquisitions to close this monday we also got some clues as to what whole foods is going look like under amazon and some of the changes that amazon is going to make. the release says that whole foods will offer lower prices starting on monday, if this does goes through which is expected to across its stores with more to come and it will integrate amazon prime into the whole foods point of sales system when complete prime members are going to be able to get savoriings and benefits there is a lot of talk of samamn getting this that means customers are going to be able to have products shipped from amazon.com and picking them up from whole foods stores or making their returns there. amazon in the press release notes that this is just the beginning and guys, this is very much an indication that amazon
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is going to integrate whole foods and growing ecosystem in a big way. amazon reiterating us here at cnbc they're not planning lay offs >> what do we know of how the integration, i am asking for a friend here about the integration of prime into their point of sale, what would i do i would give them my credentials and i would get a discount of some sort or bonus points of some sort? how much would discounts be or do we know >> i have the same question. i have been told that they have, i am not sure if they figured it out yet. they are not telling us yet because of acquisitions they go through. maybe some clues here, integrating into the point of system perhaps, it means hey, at a whole foods store using your prime account. the benefits they say are coming
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and not sure what it is going to be >> there are now amazon bookstores there is one in new york city and you get a discounted price as long as you pay with your phones and whatever the bar codcode is >> we have been to the store and the discount is significant. if they apply that to whole foods market, it can be potentially big discounts. they'll belowering the prices of some staples how suppliers feel about that? that that's the question that i have omnivore express some expressed concerns, amazon
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is known for lowering prices >> they are going to cut prices and have people picking up packages in the store and they're going to increase traffic in a double whammy and you will get points from amazon prime spending that. >> i would assume. >> that's going to cut down on transportation costs which you are sure to be pricey when you are talking about it >> yeah, wow, i am not surprise to see the stocks of their competitors acting the way they are. thank you, keep us up to date. here is what's coming up on "power lunch." chipotle's share rallied today. the white house is set to hold its first on camera briefing in th ks. wi enow you a we know you are excited. we are going to go there live. that and much more coming up on "power lunch." but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders?
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all your tv at home. the most on demand your entire dvr. top networks. and live sports on the go. included with xfinity tv. xfinity, the future of awesome. and now congress is turning up the heat. there is been a lot of talk and not much action. congress continues to focus on the issue and most recently democratic congressman elijah cummings and peter welch se sending -- they pulled out the price is more than 1,000 % now prices is more than $91,000
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a year >> when a company increased its prices and introducing new drugs in the market, other companies increase their prices to match this was not the first time that congress looked into the issue they focus on medicines for diabetes and other diseases. many would argue that just looking at the drugs' list prices listing important information of rebates and discounts. here to help us dig into it is our cnbc contributor, he's also partner and managing director. hi fred. >> it is a pleasure. >> thanks so much for being here >> when look at this price increasing overtime, 5,000 %
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over night a thousand percent over a decade, is that a problem for history? >> meg, thault's always a problm they have been around for a long time they'll always be out liars. the thing i like megan that the industry is starting to realize that there needs to be more self management if you look at the recent result that is have come out, a lot of companies have stayed in the single digit range it is a very good trend but a lot more south disciplined is needed going forward >> the social contract that you mention of saunders to limit prices less than 10% once a year even of those price increases can add up, fred we saw a new drug introduced in
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the market, they said it was priced 20% lower than other drugs. these congressmen are focusing on that one as well saying that's still too expensive what do you think about that >> unfortunately, these newer drugs are expensive because innovation is still very expensive. it still costs about $2 million or $3 million on average to bring the new drugs to market. it is about a billion too high we need to work at getting the cost of research down and improving the supply of new drugs. the best way to solve the problem is to increase the supply of new drugs. the competition in the market will bring it down we' a lot of good work is going on and new commissioner, doctor gottlieb is trying to open up the whole system it is not easy i hope the next ten years we'll see major advances in the central nervous system research, meaning parkinson's and
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alzheimer's and ms >> that's great news >> fred, it is michelle here, you mentioned scott gottlieb ahead of the fda, he's aggressive when it comes to generics, we are seeing some of the generics getting hammered. we'll realize there is going to be a lot more competition and he apparently want to speed up the process. what do you this i of tnk of the that's moved thus far. >> it is been two decade and have been increasing prices for two decades. the price increase looks very high in the old days, it was not unusual for -- sometimes there are out liars and i think he's absolutely ight. we need to open up the market and there are many products that don't have generics. by the third of the products don't have generics. we need to get those out as well >> how do we solve and i take
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your point that innovation was expensive and it could cost billions of dollars to get life saving drugs if i am on the meeting end of one of these drugs that i hope i can find a way to pay for it how do we as a nation end up paying for drug that is can cost tens of hundreds of thousands of dollars for a course of treatment, where is the money going to come from >> it is a real problem, but in its totality, the total cost of drugs is about 10% of healthcare cost and drugs are temporary opportunities for innovators to be able to get things for research and in the end, they do go to generics in some cases, there are problems that occurred where drugs stay exclusive for too long or somebody is being aggressive with their pricing and when that happens, society has every right to push back
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that kind of push back has quite a bit of the last year i am glad to see the push back, industry is starting to be morsel mor more discipline. the worse of all this is let democrats and republicans involve with pricing >> that's something that people worried a lot about president trump. we have not seen much action, fred hassan, thank you very much for joining us >> all right, we got a news alert now. we got executives from -- the investigation was announced in april. imports were up to 30% of market shares they are asking the president to move forward and take a look at this we have got some tariffs on steel that's been quote on quote dumped from other countries and
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china obviously have been very in focus and there is also a review under way within the administrations to look at this closely. so again, steel makers, executives from 25 steel maker s are sending a note the president now. u.s. steel and steel dynamics and nucor and vaneck the oil market is ready to close. some of the nation's biggest refineries are under a threat right now. how the storm can impact prices and much more after this short break.
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lets get to lesley picker, what are we looking at the close here >> it looks i can wti is down almost 2%. it is going to settle around $47.48 a barrel. gasoline up almost 3% to a
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doll $1.66. gasoline and natural gas got a bit today. an issue because the gulf coast houses are a little less of 50% of the nations refinery capacity and even accessing supplies of storm in the region. crude oil testing at 47. that could change direction tomorrow on this storm, morgan >> it is interesting to see that, i don't think traders are taking this seriously. >> well, wie'll see how bad the damage turns out to be for more impact of hurricane harvey could have on the market. lets bring in dennis, what are you looking for here and what are you expecting? >> living here in southern
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virginia where we do get hit to hurricanes on a frequent bases it appears it is going to be south of most of the refineries capabilities most are occurring up by louisiana. there is refining in the houston area and we are going to get hit. clearly they're going to be shutting down refining capabilities for the next several days that sent prices higher dramatically but only in the very near future the market is telling you as you go past october and november and gasoline futures that there is not a problem. this is short term and i don't think it is going to spin up too dramatically for the next several days there is a problem if you are a refiner and outside of the region, you will put on refinery and definitely putting on the cracks because they widen
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dramatically >> i don't think it is a long-term at all >> flooding is expected in some area we'll see heavy duty power outages. this is as bad as somebody anticipating right now what does it mean for natural gas? >> again, there is very little implications if there is an implications to be drawn from the hurricane, is that there is going to be a huge amount of rain that may make its way up to the cotton broing agr area in the united states. in fact, a dousing of rain could do damage of that crop if there is going to be any longer term location of the commodity market, it maybe there rather than an energy. nobody is paying attention on that fact. >> we had bob mitchell, he points how important the core of houston is and talk about the implications of that actually, it will be minor at best you may have more implications
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from the gdp from the eclipse earlier this weekend kb again, it depends on how the hurricane spins up and it is only a stat 1 hurricane at this point. i doubt it gets much past that houston have been through this before, it will recover quickly. impleme impleme >> white house is set to hold their press meeting since the beginning of the mthon we'll carry it live when it begins "power lunch" is back in two-minutes. hey you've gotta see this. c'mon.
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no. alright, see you down there. mmm, fine. okay, what do we got? okay, watch this. do the thing we talked about.
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what do we say? it's going to be great. watch. remember what we were just saying? go irish! see that? yes! i'm gonna just go back to doing what i was doing. find your awesome with the xfinity x1 voice remote. hello everybody, i am sue herrera. here is your update at this hour a disgruntle employee have shot one person and holding several other hostage in charleston, south carolina. police are on the scene and shutting down the popular stretch known an king street hurricane harvey makes its way through the gulf
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officials are telling residents to leaf rigve right now the storm is expected to bring near near nearly two feet of rain. that's the luckiest person in america right there. mavis wanczyk is the winner. she hits it big on numbers she picked herself, she used birthdays. it is the largest single winner in lotto history yes, she quit her job. >> something goes together like milk and cookies go figure. >> that's the news update this hour i will send it back to you guys. morgan >> thank you that's a really cute video i wonder how viral is going right now. harvey is upgraded to a
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hurricane. harvey could be a major impact for people not necessary for energy the southern third of texas expecting historic flooding from houston to san antonio lets bring in our meteorologist dan leonard from the weather company, thank you for joining us today i did hermine and mattmatthew. i can tell you from being on the ground, it was not as bad as anticipated. what can we expect from this one? >> to be honest with you, i am a little more concerned of this one than i have been for a long time it is a category one right now but there is a lot warm water ahead of the system before it makes land fall later today. there is a lot of room for this strengthening. it looks good on satellite right now. there is not a lot of sheer to
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prevent it from rapidly developing by this time tomorrow, we are talking about category three bearing down central texas gulf coast. land fall near corpus cristi some where this is the first major land fall in over twelve years. this is a big deal what are you watching in terms of industry for this >> we just had dennis garthman on, what are you keeping an eye on >> i talked with some traders this morning they have not overly concerned there is been some shut ins. we are not sure what will happen with the storm after this weekend. we are sure it will move on shore and stalling out with a ton of rain as we go into the weekend. >> and making its way up the gulf coast towards houston and
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southwest louisiana. that's a much easier production for gas and oil in the western gulf the storm has significant comings. we'll have to watch that that can be a route much more significant for oil and gas. >> you mentioned all the rain potentially 30 inches and there are some models that said four feet, what are implications on that >> catastrophic. i am not going as far to say that the three to four feet call for rainfall i would be surprised where you have some areas between san antonio and houston and mid texas, maybe closer to three feet of rainfallen in some isolated area. we have a lot of flooding in the san antonio area early in the summer, we could be looking at a repeat. they're right on the edge and austin, right on the edge of
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what's very severe flooding. we'll have to pay attention to that >> this is the first major land fall of hurricane in twelve years. what about the insurance industries and in theories they should be planning for a pay out? >> the good thing from the situation, it is not making land fall in the heavy populated area >> but, even a category three really not going to cause major disruption if it makes to the north, that'll be much more significant. not to put it off yet. if it reemergent from the gulf, then it heads back to -- having said that, just the rain alone two to three feet of rain up in the houston area is
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catastrophic that alone is really a serious situation. so refineries in the area, a lot in south eastern texas and southwest louisiana, we'll have to watch for it. we can talk about a lot of reduce refineries. over the next months or so >> dan leonard, thank you for joining us several a it is time for you to gobble it up or ayst clear next, old school debate.
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take a look at shares of chipotle stocks are still down 30, 7% from three months. so chipotle, is it going to continue its decline or beginning a turn around? lets bring in stooereven anders. >> gentlemen. i read the book in your notes, whether or not do you think
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sales are going to recover and improve overtime steven, tell me why you are convinced? >> i am convinced. the more important thing we are looking at are margins a year ago, there is a lot of heavy sales. that's not the case this year. all the other things of online sales and mobile sales, that's icing on the cake. the core of our call is that sales are improving and margins expanding as well. even what's becoming a different environment to labor cost. >> matthew, why are uconn vinced th vinced -- you convinced that sales are going to improve >> there were only two last year and consensus of 2018, both 13%
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growth in 18 and 19. the consensus top line growth is over estimated and the square footage growth is coming down. that's the in kre mental to drop it is still extremely expensive. >> stephen, one of the things that i hear from trader that is are barish on this stock, there is more competitions, what do you say to that? the broader restaurant base, wiwe have seen a lot of competitions in all category. some of the weaker raindrop ropr starting to close its restaurants. >> a quick response, matthew then we'll go. >> it is going to hurt chipotle
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just as much as anybody else >> they're the incumbent for 2400 restaurants and real est e estat estates. you will have more restaurants coming in and not less i don't know how people think it is a good thing. an even better one for gold. trading nation team takes a look at what's coming up next
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in just the last hour, amazon announcing the deal to buy whole foods will close on monday amazon will be lowering prices on many products, starting next week it will give discounts eventually to amazon prime members as well. shares fell on the news, including sprout, kroger, wal-mart, super value, let's take a look at these moves that have happened intrasession in the wake of this press release out of amazon, which was very aggressive let's bring in joe feldman, good to have you here, joe. >> thanks for having me. >> right in the press release, they say, we are going to lower price, monday, bananas, salmon, lean ground beef all going to be cut within it comes to pricing this sounds extremely
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aggressive, already. am i right >> no, they will definitely be aggressive, however the aggressiveness is to get to parity with the others like wal-mart, croakers and others. >> krogers is down 7%, malwart 2%, target is off 4%, they are intrasession moves, nanosecond moves in relation to this press release. is that an overreaction? >> i think on some it is, it seems to me a wal-mart or a costco seems to be a bit of an overreaction you have to think of the customer overlap, where the stores are located, the type of value that it's offered at those stores relative to amazon and whole foods is trying to do. now, over the longer term, i do see amazon is going to be more competitive in this world. what they are doing is what we thought they would have, lower prices, try to integrate the
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prime customers and give benefits to a whole foods store and vice-versa >> got it, thanks so much for calling in >> thank you not a good day for those supermarkets, but it has been a good year for stocks and a better one for gold, the yellow medal to out produce since 2011. let's bring in the team guy narcs you first, stocks and gold, can it keep going like its that first half of the year? >> it can keep going, michelle if you look at the two big tail winds that have been driving gold, they've largely been a weakening dollar and yields that have been falling all year if you consider that, we're likely to see debt ceiling drama. >> that will likely depres yields even more the weak inside in the dollar is expected to continue next year beau of those will support gold. >> joe >> so if you start to look at the palladium market
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it's up 30%. it's a sister metal of the gold market if gold breaks that resistance point $30, which has been tested, we have the etf strengthen >> that measures the strength of the trend, gold futures could go a lot higher we also need to have that increased geopolitical risk out there. the feds i think will delay the tightening next year, we will see if janet yellen is around from here. >> does it look higher from here are you talking about all the conditions can you predict? >> well, if you look at gold, if we break through 1350. i think it's baked in the cake we got to push through that. the etf, the strength of the trend has to be above 35 i think that will confirm the move higher and it is in the card. >> thank you, guys led to our thaid tradingnation.c
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nbc.com. check please, next >> announcer: how the latest from yc nbc.com and a word from our sponsor. a bullish ledge occurs, a break in the upper trend line is considered a bullish signal. conversely, a bearish ledge consisting otwf o converging lines pointed upwards. a break of a lower line is considered a bearish signal.
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check please. >> it's time for check please, hurricane harvey expected to make landfall in texas if you look at the insurancers, aig, they're trading lower, the higher one is generex. >> they make gen raters. >> that makes sense. i don't know if you know i have an obsession with tomatos in august which is why it's about the massachusetts tomato contest held earlier, where you can judge tomatos, taste tomatos i have an instagram account dedicated to august, called, one tomato two tomato these are some of the photos from my second insta- gam feed, not my first one. >> i think i need to be a follower. >> i appreciate it if ever viewer did as well. >> what is your favorite tomato dish. >> >> tomato sandwichs
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>> oh. >> if it's hot out, i don't toast the bread, mayo or olive oil, sault and pepper. >> i like tomato pie. >> that is delicious too. >> thank you four watching "power lunch." >> "closing bell" starts right no now. >> hi, everybody, welcome to the "closing bell. i'm kelly evans with the new york strex. >> the white house press secretary sarah sanders speaking to the white house right now this as concerns over a government shutdown loom coming up, we'll talk to two congressmen on both sides of the aisle for their take on the debt ceiling drama. >> if we need to, we will go to that live. the threat of hurricane harvey swiftly moves closer towards the gulf coast we are tracking that megastorm we will see how it could impact oil markets and the population coming up.

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