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tv   Squawk on the Street  CNBC  July 30, 2019 9:00am-11:00am EDT

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>> hmm bullish, but not that bullish. >> not as -- no, we have come a really long way on just liquidity. >> you are an owner of crypto. >> i am. i told you below $5,000. >> you almost sold at 13, right? >> i almost sold, but i didn't. >> mohammad thank you for being here join us tomorrow "squawk on the street" begins right now. ♪ good tuesday morning, welcome to "squawk on the street" on carl quintanilla with jim cramer at the new york stock exchange, david fabers that day off. europe is having a rough morning. dax on pace for the worst day since february the pound's bruising continues brent back above the 50 day. k. schiller is out, home prices
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up as opposed to a year ago. the president ripping china saying they cannot be trusted as trade talks resume in shanghai stocks are set to open lower g and p beats. and beyond meat tumbling a long tweet this the president hoping to weigh on futures today, quote, china is doing very badly, worst day that is the problem with china they just don't come through goes on to say, jim, if and when i win the election, a deal will be much tougher for them to get. >> yeah. i have been saying the notion, that narrative that navarro was out or is not important is dead wrong. i interviewed the president back this the mid 20 0s
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he really felt that china was getting free ride. this is the china, no business, where is the soy bean buy, the machinery buy? it is outrageous that they agreed and they did nothing. i think the president's view -- this is what i was worried about. the president's view is we are going to put tariffs on 320 billion and if they start to play ball we will cut them rom reagan like. >> he hasn't done that >> no, but that is the navarro sense, and i think he is prevailing if mnuchin comes back with a big buy things will change. >> buy soy. >> they don't want trade navarro wants them to forego 2025, which they regard as a direct attack on us.
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navarro would love it if they would say we agree that huawei has been a criminal enterprise they are never going to do that. the president feels momentum remember, he's always got that thing, the trump towers. he loves the trump towers. why? because he thinks they are bringing china to their knees. we have chinese pmi tomorrow night. if it is slow, then he is going to come out and say we have them we have them i don't know where people -- i don't know people get this like navarro is not involved. navarro is the -- white house and navarro have very little distance between them. >> navarro is not in shanghai. >> he doesn't have to be he has the ear of the president. that's all that matters. >> right. >> and i think that what navarro was saying is look mr. president where are all the things they promised when we got together. that's causing these tweets. he is saying mr. president i told you, you so then you go back to the meeting they had with tech and the tech guys are saying we
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can cut out huawei there is a camp, the mnuchin camp which basically is president is saying you guys better come up with something. because if you don't it is going to be $320 billion in tariffs because the american people love it when the choice pay for tariffs. even senator elizabeth waurp's position -- by the way we haven't talked about that. it is harder on china than this president. if you or she were playing whatever the intelligencia says if you were she you would be saying what's the word on warren she is going the win on it does iowa control the democratic party? yeah, biden is sleepy. so you have trump who believes in some possibility of trade with china and warren has no china. that's it. china is gone. not taxed. just gone. >> if you think warren is outflanking the president on trade. >> absolutely, why he.
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>> is he wrong that the chinese would face an easier adversary if he lost the election? >> well, if it is biden, yeah, because that would be business as usual. >> if it is warren, let's say. president warren -- would president warren be tougher on china than trump. >> yes, because warren is saying that the capitalist, that the ceos in this country have sold out the american worker in order to be able to sell as much as they can if you look of the some of these chinese numbers, they are. it is diapers. they would sell us out for diapers. senator warren i know you watch this show, it is a good line for you. use that. >> it is not just china. japan, industrial production second biggest decline this three years. you see what the dax is doing today. maybe some of that is because of china, we know about the ties between germany and china. >> it is interesting that the chinese are -- they have big business with huawei think about germany. they have erickson, a european
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company, nokia, a european company. they don't give a dam. they are selling them out to buy huawei in order to sell bmws, and mercedes craven, craven cowards >> china is the biggest auto market and we know the germans make a lot of cars. >> they don't care about that, there is principles, too, i understand that principles should be sacrificed for car sales numbers, volkswagen. >> if the 25% tariff goes on all imports from china, s&p estimates could be lowered as much as 4% >> oh, come on >> that's assuming no pass-through. >> he -- well look i am not saying be bullish for the market by any means the president made the decision that the market has gone up a huge snoomt house money. >> we sown own it. i think the president truly gets up in the morning just like he
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looked at the nielsen ratings after the apprentice, he is looking at the dow versus the different chinese indexes and he's thinking we are crushing him. he's right but the chinese better wake up to senator warren she is saying things -- i was twice a union member it is all about the workers. it is all about being tougher on china than the president it is. i mean, she's throwing in pollution for heaven's sake. can you -- chinese pollution? 18% of the pollution in california is from china people are ignoring senator warren your own pearl, you ignore her. >> she is a fire brand she wants to raise less corn although she likes soy, and more hell. >> her position paper yesterday was -- >> people are ignoring it. i read through it and it is basically saying china we don't
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know you, you need us. >>er to any trading partner for that matter. >> if i were navarro i would be switching camps. navarro is so much more warren what can i say navarro is a hoot. >> we are going to talk trade with the vice president's chief of staff mark shortcoming up in the next hour. actually, is he chief of staff to the u.s. vice president >> hey you can ask him about the october 4th speech where pence said it was a new cold war ask him about 1947 he may recognize that year. >> p and g up on the premarket helped by price hikes in & strength in beauty. under armour tumbling after out canning north american revenue guidance amid heightened competition. p and g, organic up 7% strongest in 13 years. >> it is an american growth
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company. they are taking share, also taking names they turned around grooming. can you imagine? >> incredible. fab ri care up 10 is now of the biggest category. >> what, people that never washed before are now washing. instead of using stones, using washing machines those numbers are extraordinary. they have a good internet strategy i know they were asked by andrews have the big dogs, the facebooks at all put pressure on them i would tell you they are putting pressure on the facebooks. instagram is the way they are selling. ralph lauren, instagram is the way they are selling i love the ralph -- the ralph lauren quarter i have chip on tonight about levis. they had a great denim number. >> polo growing wholesale for the first time in four years >> isn't that amazing? >> there was an easter benefit
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in there. >> still monaco -- my wife likes the monaco label china, really good china numbers really good. there have been some china tariff issues. they have not been a winner but they transcended them. matthew borsch was using a number of two. these guys beat the numbers. i think it is an underappreciated story it is better so far what what we have seen from others. >> yes. >> i have got to hand it to them i think he has the he is could he has the engine. he is turning it some of the other guys -- >> to circle back on proctor after coke, after pepsi, after bud, after union lever, what's going on -- they are all great quarters. >> quincy. i was not -- i lapped to think james quincy is amazing. because he rares his brains lightly. that was a remarkable quarter. and he is expanding everywhere it is really across the board. when you look at new products,
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too. i mean he's just -- he's on fire. >> when you hear hillaryia a moment ago say graduate to quality -- >> you named them all. proctor and gamble, starbucks. >> mcdonald's. >> that report has got to go they were in thamp tons by the time he was finished talking about the kiosks in australia. i will have to get to him. he is going to report another day. i will talk to him today it is ridiculous. >> what is under armour about, nike share >> there was a piece yesterday by boss talking about nike just saying okay we are done, we are taking no prisoners. there is a take no prisoners nike coming up i would that i can as a buy off the under armour stuff. >> this is the worst day in two years, when they lost 23% in a
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single day. >> i didn't think they would be as flat as they were we have guys preannouncing great quarterers restoration hardware, holy wow, it wasn't just my wife those numbers are incredible gary freeman is killing it some people are crushing it right now. he is china. i should mention that ralph lauren they have taken their china manufacturing down radically. they have just -- i mean you get these quarters, you are talking about you are just amazed. like wow, look at those numbers. it is incredible he has gotten -- where the hello health is that. >> as restoration will try to do. >> restoration is pulling back ralph lauren was plus 40 in china. now it is low 20s. vietnam will fix that. >> now the pressure is on vietnam on their trade surplus and these answers to senate
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finance. >> people forget how well vietnam did against china in the vietnam-chinese war this the late '70s. people forget they had a war they are not friends they can deliver chinese manufacturers moving to vietnam. they are not going to let that business up, they are just moving it to another company this is an exciting time prok for, pock for. >> when we come back, beyond meat shares are down as the company announces the secondary. jim will let you know what to do with that, on what has been a red hot stock. back in a minute don't miss your golden opportunity
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beyond meat slumping in the premarket, its announcement of a secondary overshadowing quarterly sales that nearly quadrupled from year ago on last night's call, may talked about what is driving top line growth. >> we are using our -- advantage
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to drive expansion in retail today we have 53,000 points of sale worldwide up from 30,000 at the time of our ipo three months ago we are expanding food sale partners as well as increasing velocities you can't bebruj them for issuing this secondary, can you? >> not at all. there will be people that will say -- has no faith. you have an 800% stock and you don't sell some you are a fool all right? you are a fool you are just a ridiculous believer in yourself i will say this though here's what people are missing it is a tale of two processes. twitter people don't get they have got to listen to the call ethan brawn was extraordinary in the call meat from animals in factory farms or meat from plants. consumers can choose that's what it's about ethan -- oh, it is all
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chemicals -- will you listen to the call the call was a work of genius. what's the real problem here they can't make enough i mean, he's such a recall in a. he is i already had two sausages today with my cup of coffee. if it is so bad, why isn't it down 100 should you buy it up here? no will the secondary be one of those things -- i once went to a terrible dog track in the south. i mean,ment cello -- you mean abusive to. >> no. no it was so pourly run that the electronic rabbit fell electronic rabbit, that's what they do. the gray houns chase it. they went nuts because there is meat on it the shorts are going to have to cover on $3.25 million good luck. 46% of this thing is short but they are going to be just gray hounds after that beyond meat rabbit.
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and i think they are all going to be thinking oh, we can let this come down it should be down more it should be down -- look, it was a fantastic quarter. and those who keep saying tyson -- tyson sold their sixth. tyson is like mcdonald's, let's sell chipotle. he was elon musk without the anger, without the meanness, without the pettiness. a little more genteel. >> we wondered why tyson did that around the time of the ipo. but if capacity constraint is such an issue, why rcht a you more worried that the likes of tyson could take share >> i prefer mike dayson to tyson foods. tyson is using combined. when you talk to ethan he is like who wants a partial meat burger what is the point? i want a little bit of cow i want a little pea. no not at all tyson has no game. and the nestle burger, frankly,
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i mean people put up recipes for dog versus the nestle berger i did not know did not know nestle has to change the taste and millennial customers think of gmo the same way as they think of anthrocite. mines, they are strange, but we must listen to them. >> as john mueller of proctor today said chasing that demographic is key. >> once you decide to listen to amy chang who is on the board, the youngest member of the board. may be the smartest person in america frankly, i know that's a bold claim but she sold her company to sis khouw. she is a genius, she has been take here's what the mines want. also nelson pelz, going to be interviewing him
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but amy chang is right if you appeal to the mines then you get beyond meat. mike tyson, find me some mike tyson. we will get to the opening bell and another look at the premarket on tuesday there is a lot going on. w ictaetn e you about goldman's nepre rg oths&p when we come back his luxurious fur calms my nerves when i'm worried about moving into our new apartment. why don't we just ask geico for help with renters insurance? i didn't know geico helps with renters insurance. yeah, and we could save a bunch too. antonio! fetch computer! antonio? i'll get it. get to know geico and see how much you could save on renters insurance.
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and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. healthier brain. better life. president making comments this morning to reporters. we are going to look for some tape playback in a few moments but the word we are getting, jim, is that he says the economy is doing fantastically well. we are going to get a good deal with china or no deal at all very disappointed in the fed wants to see the fed make a
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large rate cut sort of what he tweeted yesterday looking for more than a quarter point. >> look, the fake news people say it is oxymoronic the fake news people say why does he need to cut the rate if business is good what i think the president ought to do is stick by script of it could be even stronger if we had a rate cut ask why not? because when you are on a proctor and gamble call you cannot believe how much the dollar has hurt them and what numbers they could do if it weren't for the dollar i am not going to tell the president what to say, but what he should say is that the -- maybe i am but he has to stick -- he can't -- he is -- the president is in a box. because he knows that jay powell is going to say the reason we have got weak seasons trade. >> trade. >> he has to say the reason is because of the fed his narrative is getting tired, it is getting boring, the president's. it not going to happen in cold
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water tomorrow when we get quarter point. you can't say that the economy is on fire and we need a rate cut. it is oppositional. >> navarro said if it hadn't been for the federal and boeing we would have been up. >> it is like guaranteeing cleveland's victory in the super bowl rein it in we don't need 30,000 it is not price target we are not strategists take it down that's a mistake what you are doing -- you can't do a cold shot he ain't no ted williams give us a break. but i do feel that's the right statement, which is that we are doing well but we could do better that sinks with janet yellen
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we are not doing bad but you want it to go down it is decelerated. autos -- autos are like down 7% for a lot of these companies you listen to 3m it is no picnic, cummings, no picnic caterpillar, it is like wow, what's going on out there. remember, there is two economies. two economies. >> there are -- we have halfway through earnings season. >> right. >> companies that have 50% revenue outside the country revenue and earnings are negative and those that are domestic, earnings and revenues are up. >> navarro has to say because of the strong dollar and because of the tariffs we need to cut rates. don't provoke jay powell. >> why what's he going do. >> he could give you color which says i would be raising if it weren't for the fact that we have a trade situation this the
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administration that's what he should be saying. did navarro take that whole thing from me with the boeing? i love him, but a little credit when credit is due. >> dudley with the bloomberg op ed saying there is a good chance one and done the case for lowering rates is less compelling now than it was at the last meeting. dudley is no longer at the fed. >> he shouldn't have said that that is -- that is -- listen to yellen if the data says it is getting weaker, then you have to cut again. one and done is -- i always thought that dudly was a rigorous fellow. i am reexamining my analysis of him right now on the fly that's not the dudley i know the dudley i know is more thoughtful than that bill, i'm sorry, you are a sweet guy but i am giving you a d and ending it back he has to send that homework back. >> how many basis points. >> 25 now, and i want a yellen let's see what happens not one and done
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dudley, come on. i am going to give you d i will offer you extra credit. i am going to be in my office at 7:00 office hours that's a shame one and done merck. here's one keytruda is the best -- i don't want to -- it is the one thing you don't ever want to do is say this drug solves cancer. it ds not. but i have to admit this is a queen bee. i think merck right now is fighting a tide of people saying if we saw the prices for drugs in hospitals we would think keytruda is marked up too up in. i believe that to be the case, but merck had a good quarter eli lily's numbers for diabetes and for migraine when excellent. but the merck is a standout particularly pfizer. used to be one of the other.
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there isn't -- let's not forget, this is this kind of massive hangover of the selling, once again, the fangs, with the a, faangs, that's hurting drug and tech. >> pfizer is cut at morgan stanley today. >> disappointing how bad the core drugs were doing, it was a step down. >> basically reducing estimates by 15 on the upjohn span. >> true. >> tonight we are going to have amgen, sell gene and gillian. >> amgen, disappointing, sell gene preannouncing okay. us about of the acquisition, squishy. >> the big one tonight >> apple if you do 12% service revenue, and the stock is at 190, you get 240. i want to ask you, what's in your wallet in. >> we have not mentioned capital one quite yet. but that's another big story. >> the reason i mention it is because apple hasn't talked
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credit cards they won't it is not going to be in their scripts. but scripts are -- they can switch the script right now and not mention capital one. that's a bit of a downer could happen to anybody. but there is an opportunity in credit cards about 100 million credit cards >> let's get the opening bell here s&p 500 at the cnbc real time exchange a real estate investment trust celebrating an anniversary at the new york stock exchange. and salarius >> bought genome, a fantastic company for targeted immunological. those are targeted prices. if you save someone's life what is the price there is a tension between the president and how much we are paying for on cological. cloud kings down again, carl they don't stop with selling the splunk, and the vm wear and the
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workday and sales force. it is just an etf. think for yourselves sneem it is proctor and merck helping the dow at this point. >> i think it is a gloomy day. it is a gloomy day i don't think it should be but we are stuck with ralph lauren doing really well. he were this up 6. now it is barely up. people are too critical. on "fast money" money yesterday the traders want to trade this route. >> if you can get a deal over the next year and a half. >> the biggest risk is the $320 billion tariff i think what you are getting -- he undercut mnuchin there n a tweet. >> with his man in shanghai. >> fire mnuchin. he basically cut him off at the knees. >> you said this a couple days now. >> yeah. >> do you know something >> i no nothing. >> the anniversary of that is
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friday we are going to play some of that on friday. >> i don't know much about what's really happening. but you know. >> jim, the goldman call they take their 2019 target to 3100 >> right. >> costen introduces year-ends 20203400 even as they cut estimates. i mean, this is -- we are heading into period where earnings might not do a lot but if you get the fed on your side. >> don't fight the fed marty's wife told us marty's wife, we all know him from wall street fame, don't bite the pad don't bite the tape. if the fed is out canning i want to be even in the worst cyclicals. if they did anything that's good i want to be there and i have got to get out of the companies that do well when it is soft. that's the cloud kings hbi was down 4 off the quarter
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now it is barely down and it will probably be up. if you look at the core really good companies that are software as a service, they are not doing that well. they are not doing that well that's what you want to watch believe it or not is ring central. rng. bellwether it is up 13. if that stock sinks to being down look out cloud kings beyond meats are down 35 what are they going to do? the shorts are panicking right now. can you imagine if ethan was talk today elon musk. ethan. >> amazon, we are back below the 50 day for the first time in over a month. >> not supposed to happen. >> this capital one employee who has been arrested accused of breaching a misconfigured fire wall to get data that was stored in aws is this a liability for amazon >> amazon webb searches have
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been so impenetrable you can't game fraud that's one of the reasons why cyber arc is always taught there are people who can lead. they have the keys to the kingdom and you have to try to stop them. this was not equifax it was espionage. >> the stock is nowhere near the equifax situation on capital one. >> capital one eyes glaze over, until they look at their bank account one day and maybe something changes. capital one, people are going to have to say -- richard cramer is a pretty good guy -- smart guy i don't mean pretty good capital one has been the one to shoot against. they make you pay a lot and give you a lot of credit. this is apple's chance apple is not as opportunistic as i would like them to be. people will be up for grabs if
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this thing mushrooms. >> mastercard up 21 stock is a little bit lower i think. >> it is down -- my travel trust owns it. they did not guide up the way i would have liked but mastercard is one of those stocks where you wait three days and then you buy them. here's the problem with mastercard thin tech is like cloud tech these are all for sale as managers pull out of thin tech, they pull out of cloud tech and go into the seven cyclicals that remain in this country because the chinese destroyed most of our manufacturers. >> that's a good one >> navarrnavarro. >> uber laying off a third of its marketing team about 400 workers. citi yesterday according to bloomberg -- >> traders. >> hundreds of traders globally, including 10% they say of equities. >> citi he's going to -- corbett is going to buy every share that you sell if you sell below 3% yield you
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are selling it below tangible blue book value. it is good for every shareholder who buys back. let's watch facebook down 3 in premarket. now only done 53 facebook led this selloff. there were no flies on facebook. i thought. you have to watch -- i am reading by the way the book -- i am reading the book. i am reading ben off's book, trail blazer watch that one down very badly. monaco also -- it reads very well, starts out with our own andrew sorken asking the question about endavos jaw dropping. >> his tobacco am gee. >> >> he said people hate him since then his wife called him the regulator when he came back. watch facebook, and sales force. daggers are gunning for them i like the book.
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trump, disappointed in the fed he kind of made that point he's kind of made that point. >> he's disappointed in the fed? >> don't you think he made that point. >> i think it is clear to everything how he feels about the fed. >> does he have a nickname for jay powell >> no, hasn't developed one for jay powell. >> and nancy pelosi. where are his nicknames. >> sleepy -- joe. >> what would you do with powell >> powell? carry grant. he doesn't usually do that some of his nicknames are the kinds of things where if you went home your mother would take the hair brush and smack you and say wait until your father gets home. you are lucky you are only getting the hair brush my father would do the five fingers. >> d ram channel checks looking better. >> using a $31 target. boy, did he have to eat crow,
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with must starred, using french's i think that micron is going to be up. that is a bold call. the pe is five he is saying it is a short-term thing. he has been flummoxed. he had to make a move. his price target was too low he had to make a move. it is a good day to make a of mo mxp making a comeback. industrial, industrial emaye. >> a good one to watch. >> yes. >> how do you think the president responds if powell only gives a quarter point >> probably a tax him personally i hope not his family is nice i hope the president doesn't stoop to that. it would be a shame. no names, jays jay's going the right way. jay is just -- he doesn't want to do anything radical to upset the markets. what he ought to say is ji's on the path to forgiveness. what do you think of that? >> i think you could go into political marketing.
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>> i think he is on the path to forgiveness. you kill more flies with honey than you do from a nuclear weapon that the president likes to talk around >> that's been the favored strategy over the last couple of years. >> anybody can change their strategy what he ought to do is do a little apprentice thing. i really wanted to like what jay did, but i spoke to -- then you could throw anybody in there, right? i don't know i spoke to the labor secretary, whoever the hell that is now and he said it should have been half pony and i agree with the labor secretary. do you know how he did that on the apprentice my daughter said -- i don't want to do that, his daughter is terrific i think he has to layoff powell. >> or else what? >> or powell is going to make it tough for him. he can't fire powell. >> powell said he is not going anywhere. >> what if he fires powell and brings back yellen he has to pack the fed with
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well-known hacks >> he didn't know how good he had it under yellen. >> he didn't if you want to get your way with powell, just say, you know what, i say he is saying the light if things get weaker he is going to be on the team but he can't make fun of powell. powell is a rigorous good guy -- when powell created the bear market in december i never called him any names i just said he created a bear market. >> he rectified that in a hurry. pce core around 1.5. gives him a lint of cover, wouldn't you argue today absolutely. >> as personal income and spending are in line. >> once again if you were to speak to the companies you mentioned earlier, the international companies all doing good that's a great thing to be able to say but he also -- is he going to throw the bomb that if the president does $320 billion in tariffs i may have to do more? that's how i would approach it if i were jay f the economy
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slows down i would do another quarter percent. the president has to declare victory here, he has to stop it with the rubbing it in the personal thing -- in the end we all start thinking about what our mother would say about us if we did this stuff. >> you would think so. >> mothers don't like the psycho names. the name calling is bad. i know he thinks he is funny but in the end it is hurtful. >> dow is down 120 we are back to 3006. to bob pisani. >> we are waiting for the fmoc drift to kick in that's the tendency for the market to move up in the day before the fed meeting defensive tone today the consumer staples up, proctor is up, coke is up. defensive here, as i mentioned, wreaths doing well semis, growth indicator, slightly on the weak, industrials also slightly weak cummings, caterpillar, global industries a little bit on the weak side. transports within the
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industrials, rider had lowered guidance the trucks generally on the weak side halfway through earnings seasons. more than 250 companies reported in the s&p 500 76% have beat. about ample for the last four quarters let's say thepgs things are not unusual. flat is the word i have been using more than a month. flat is essentially what we are seeing that is better than dire predictions we had two months ago in may when they said numbers were going to come down because of global growth we don't have clarity on global growth and we have central bank back stop. when i say flattish. here's what it looks like for 2019 earnings numbers. basically up 1.6%, flat, .6 down .6% this is what flattish looks like hope here that numbers will get a little bit better this the
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fourth quarter lets not quibble about a percentage point or two. this is flattish numbers for 2019 here's what's important. domestic versus foreign sales. companies that have more of their sales outside the united states generally are reporting lower numbers. this is a fact set number. i think it is important. companies that have more than 50% of their revenues outside the united states generally seeing earnings down 13% those who are more domestic oriented up 3%. this is a he have very wide difference this is from fact set. sometimes the numbers are different than refinetive. you see the difference that's the global slowdown, the tariff and trade war we are seeing a little bit of an impact but not bringing the overall markets down because of the strength in domestic sales in the united states one thing you have to be aware of is high multiple growth where the commentary is not as strong as people wants thought about
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it i am talking about under armour. good news is good news, numbers were okay and they atermed their full year earnings isn't that what matters. but north american sales, 65% of their revenue is north america, down 3%. we were expecting flat to slightly up there. the guidance for north american sales a slight decline that's not a good okay that's why unarmor is down so dramatically down almost 20%. how could that happen with revenues >> very simple they are expected to make something on the order of 35 cents this year. 35 cents you divide that by 24, which is what the stock was, and you get a multiple of 70 folks, you do not get a multiple of 70 times earnings when your revenues in your primary market are declining. the market won't give you that kind of multiple you want to see primary market revenue going up, not down
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that's why we are seeing a decline here my point is there is a bunch of expensive stocks that have been darling for a while out there. when you start talking about slower growth they are to the going to give you the benefit for the doubt. right now the dow down 90 points. >> to rick rick at the cme in chicago with data on the way in half an hour, 15 minutes >> home sales, consumer confidence and rhett now the first day of the two-day fed meeting. a couple of observations we have this nine sessions in a row that have closed between 202 and 208. down three now at 204. 194, 195ish is the low yield close for this cycle we are a bit lower in yield than we were on the july 18-19th meeting as you see by the mid july chart the congestion i referenced today, most likely could be the tenth day in that tight range. look overseas, this is a long
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term 20-year chart of german bond yields. minus 40 basis points. it is now sitting at its lowest close ever of course. and they seem to be leading the way. bank of japan didn't really do anything but like the ecb promises more, could always be thrown on the griddle should it be needed. the question s what does needed mean and how do we get out of this needy situation seems as though the fed is following the lead versus taking the stand on normal a's igs. here today, the color index chart there is what i want you to notice is the third week of april we had the high close going back to may of 2017, 9820. as you look at a 24 hour chart of the dollar index it basically touched that level earlier we are about a tenth of a cent away even with the easing on its way, the quarter point built in, the dollar index is certainly acting well
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most likely it is acting well because of the future arbitrage with other central banks continuing to follow the easy stimulus route carl, jim, back to you. >> rick, thank you very much we mentioned the president making comments this morning we are going to take that tape playback right now >> what will the rate cut be. >> the talks are moving very well with china, which they were often with china, but china always makes a new deal at the enor seems to. they are taking in -- we are taking in billions and billions from china they reduced their currency and are pumping money into the system in order to pay for it. they have had the worst year in 27 years they have had a terrible year because of the tariffs a lot of companies are moving out of china
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you have never seen this before. the united states is doing phenomenally well. we are taking in tens of billions of dollars from china we are giving some money to our farmers who have been really targeted by china to did a number on them because they like me, the farmers like me, and i love the farmers and i will say that the farmers are grateful the most they have ever spent on agricultural products is $16 billion. so when they pulled out, i took just a small part of the money that china is paying us, and i gave it toward the farmers and the farm remembeers are ver. >> is the quarter point rate cut are the fed and not from you >> the fed moved too early and too severely it puts me at somewhat of a disadvantage fortunately, i have made the economy so strong that nothing is going to stop us. but the fed could have made ate lot easier i would like to see a large cut, and i would like to see
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immediately the quantitative tightening stopped it should be stopped for them to have done quantitative tightening and also higher interest rates simultaneously, i think was a big mistake. i also think that had they not done it as good as we have done -- we have set a record, if you will tell -- as you will say say in the stock market. we have the all time high in the history of the stock market. i think i would have been 10,000 points higher and would have been in forbes with gdp. president obama had zero interest rates we have normalized interest rates. with zero interest rates nothing happened and we have blown his economy away >> [ inaudible question ]. don't talk about that. i am disappointed in the fed i think they acted too quickly,
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by far, and i think i have been proven right people have said i was right they were wrong. the fed is often wrong the fed is often wrong. >> that is the president making some comments on his way to virginia later on today for an appearance his fixation on the fed today on t appearance his fixation, page one of the "times," farmers having the worst year partly because of tariffs, partly weather. >> i measured that how well deer stock has been one of the things incredible, how do you have trade talks when the president says, listen, we're taking in all this money from china let's take even more from china. a lot of people, elizabeth warren wouldn't argue that money is from china. right now you listened to ralph lauren this morning. he said, listen, consumers -- everyone trying to adjust. walmarts of the world, targets
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of the world i would say what happens now, if you got -- here is the progression. if you have no trade talks or they break down, the money flies right back to the sales forces, because what that says is the economy is going to slow the president is walking an interesting tightrope here why is he bashing them so hard i think because he realizes -- i'm not kidding. he's very smart about politics, warren is going to take iowa she's in the lead. she better take the deal that trump has offered. there is no trade talks. there is no trade talks with warren no trade talks. >> not from what she wrote yesterday. >> people don't read her stuff it's a good read, a quick read if pollution and dumping, we don't need any of their stuff. so she's given a window here where trump's deal is a better deal than what warren is offering warren is outflanking trump. >> on trade that is definitely
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true amin is there. how much of the calculus is about the contenders on the left. >> jim is right. the president is paying attention to them and figuring out what the politics would be my exchange there was agents hard to hear what i was asking him was is a quarter point rate cut for the fed enough for you i was trying to get him to get a benchmark on exactly how much he wants the fed to cut he wouldn't say specifically he didn't give a number there. he did say he wants a large rate cut from the fed one of the questions i have this week as it unfolds, if the fed goes forward with the expected rate cut this week, will the president criticize them for not going far enough that is, is there anything the fed can do this week within the bounds of what's expected to satisfy interest in low interest rates. what you heard there is the president saying he wants a large cut. that suggests to me anyway he's not going to be satisfied with quarter point cut.
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he wouldn't say that when i asked him. i asked him several times, pushed him on it on the rope line a few minutes ago. >> something to keep in mind as we wait for the decision when we come back, talk with vice president chief of staff marc short who knows a thing or two about congress dow down, low 151. we're back in a minute to a single defining moment... n a plan stops being a plan and gets set into motion. today's merrill can help you get there with the people, tools, and personalized advice to help turn your ambitions into action.
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i'm going to get a hibachi and it's going to be good. >> we'll see you soon. when we come bk 'lacwel talk trade with chief of staff marc short. short. dow is down 75 i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale. mm. yeah, they sayanch it it's better, but that seems like a lot of work. no hidden fees. no platform fees. no trade minimums. and yes, it's all at one low price. td ameritrade. ♪
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good monday morning -- good tuesday morning. welcome back to "squawk on the street." i'm carl quintanilla live with the new york stock exchange. david has the day off. we're recovering some. let's get to rick santelli. >> all right i'll tell you what, carl, i really get surprised with the confidence number. this one is surprising our july read on consumer confidence from the conference board expected to be 125 yeah, add more than 10 135.7. that is you have to go all the way back to november last year when it was 136.4. the month before that, october was 137.9.
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that was the best september since 2000 this is a dramatic jump on consumer confidence. you see it on every metric present situation leaped from 162.6 to 170.9 expectations, what's ahead, from 94.1 to a current read of 112.2. these are humongous. by the way, late revisions coming in, 121.5 from june of last month gets upgraded to 124.3. these are big revisions. now, on pending home sales for june, we're going to turn to diana olick. diana. >> a nice beat pending home sales 2.8% up in june compared to may, 1.6% higher annually that finally breaks a losing streak year over year. sales had been lower for 17 straight months according to the national association of realtors pending home sales measured signed contracts to buy existing homes, so they are an indicator of closed sales one to twop months out clearly lower mortgage rates are
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helping. average rate of 30-year fixed 4.29 and ended june at 3.8% according to mortgage news daily. that had to help with affordability but prices are high regionally sales higher in june from may and higher everywhere but in the west they were most strong that's where prices have been moderating as well back to you guys. >> diane olick, thank you very much. our roadmap for the hour is going to start with china trade tensions the president sounding off as the two countries resume negotiations. >> plus it's day one of the fed's two-day meeting. we'll look ahead to powell's big decision with the president continuing his criticism of the chair. >> former treasury secretary larry summers will join us to discuss the fed, trade, and more let's kick it off with big earnings movers to hit start with beyond meat plunging, wider than expected loss, a share offering that's really what hit the shares overnight after hours the stock up still more than
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650% since its ipo top line growth is pretty strong. under armour sliding, shares down double digitals on pace for the worst day since 2016 cutting full year north american revenue forecast amid heavy competition. we'll talk about that in just a moment bucking the trend p&g. the ceo will join me later on "closing bell. it's an exclusive interview. just came through on this remarkable quarter, carl you know we've been covering the p&g turnaround story this is the height of what they have seen of progress at the country, the revenue the best in years and they are projecting it continues with their full year fiscal 2020 outlook of 3 to 4% organic growth if you look category by category, yes, beauty is certainly a standout that sk 2 brand of skin care is
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just killing it in china grooming, gillette grew 4% this quarter. health care 10%, fabric and health care 10%, baby 5% it's a double. it's raising prices and also volume gains what do they do to turn up with growth well, they gotrid of the matri structure with new board memberer who pitched this idea and helped speed it along since he's been at the company the last year or so. they have moved because of that in a faster, more nimble way, which was the whole point of it. what under the circumstances out of that is innovations ds 3, i'm not saying this is a growth driver yet but indicative of the new p&g have you seen this it's basically soap and shampoo with no water and no plastic it comes in packages it's like a powder, you mix it together it's 10 years in the making, a
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huge r&d, shows you a new level of thinking at p&g, wants to get in touch with the consumer who wants sustainable and no chemical. >> john muller asked about the influence of pelts on "squawk" and said the credit went to the 90,000 employees at p&g. but fabric care up 10. jim was just joking whether people were not washing their sheets before, now their biggest category. >> tide pods. >> crazy. >> a lot of it is the new innovation they have taken share and are able to connect with their local markets faster and better than they were before just want to quickly hit under armour because it's getting slammed today. i just spoke with the company. there was some kproochlt at under armour to talk about, on costs, margins, inventories, on all the boring stuff that shows that the execution is better they are a few quarters into a multi-year turnaround story. they would point to that as saying things are getting better however, very disappointing to
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say north american top line growth is going to be worse than expected they are now expecting a decline there. the reason they are saying is they are trying to do less promotions, fewer promotions for direct to consumer that's always a tricky thing for retailers. we saw a number of retailers go through that before like coach or michael kors. it takes a while to train a consumer used to a brand under armour, always on sale, that it's not going to be on sale anymore. they feel good about the progress they are making at least to make a more healthy, sustainable, profitable company. clearly wall street wanted signs that turnaround was working, they are getting more shelf space and top line growth and we just did not see that from under armour the other thing you have to talk about is market share, which has declined especially in north america, their core market, especially in apparel to a nike and to an under armour which has done well. i have numbers basically from a 6% to 5% on active wear
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according to npd group through june of this year. >> safe to say, this will remain the worst day only since 2017 when it was down almost 24%. so we're nowhere near that. >> also stock up more than 50% this year and a lot of hope on wall street for this turnaround. >> all right meantime the president expressing some scepticism as china trade talks get set to resume saying they cannot be trusted. the president tweets china doing badly, worst year, supposed to start buying our agriculture product now. no signs they are doing so that's the problem with china, they just don't come through talked about the trade talks at the white house a few moments ago. >> china has been taking out hundreds of billions of dollars a year with our country. now what i've done with the tariffs is, number one, they had the worst year they have had in 27 years yesterday "wall street journal," worst year in 27 years, companies are leaving china by the thousands, and their prices
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are coming down. i will tell you this, china is dying to make a deal with me whether or not i'll do it, it's up to me it's not up to them. >> the treasury secretary mnuchin and trade reply lighthizer meet their chinese counterparts in shanghai joining us from the white house marc short, chief of staff to vice president mike pence. good to have you back. >> the president's tweets suggesting the week is not going well can you give color around it. >> you heard him say china had reported worst economic growth since 1982 the reality of what we see is manufacturing jobs fleeing china. some are returning back to the united states because of our regulatory agenda and tax agenda but some going to other parts of asia so the president feels we have leverage at the moment in negotiations with china. i think for a long time there's
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been an assumption with previous negotiations, if you have trade in china it will lead to other freedoms but that has not proved to date. china remains a communist nation that abuses human rights the reality is there's a lot of concerns we have about china on the national security front, too. this president is looking to try to reset those relationships we're hopeful we can get a trade deal at the end of this. he recognizes right now they need it more so than we do, he believes. >> last couple of days the president mentioned more and more the idea the chinese would wait out the election cycle in the u.s. we often ask analysts if that's their base case. is that your base case >> i don't know it's the base case there is frustration, as you've heard the president say and secretary mnuchin say, that we felt we were about the 10 yard line previously. then we felt there was several hard-liners in china that pulled back because some of the enforcement mechanisms they were
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unwilling to live with that's been a challenge to our relationship with china for some time when they strike deals, they backtrack on a lot of areas where we wanted to enforce the restrictions we've put in place that stopped transfer of ownership, stopped intellectual property theft, that would actually limit subsidies they provide in supporting it from essentially a communist economy. we've been frustrated they pulled back on some of those enforcing mechanisms but we're very sincere about making sure those things are protected in future trade negotiations. previous administrations have been unsuccessful in ensuring they no longer steal intellectual property and there are limits to subsidies they can provide in competition here with the united states. >> do you guys in the administration feel this is a good campaign strategy not to make a deal with china in other words, there's this new feeling on wall street the
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administration doesn't have any interest in making a deal because the base likes china bashing and the tough attitude and tough stance you're talking about and the president is taking with regard to china. >> i don't think i'd view it that way i think in reality a trade deal with china would probably boost markets significantly and would probably benefit the president politically. i don't think he's looking at political edge, he's looking at resetting the relationship for what's best for the united states not just today but future years as well. i would have a different viewpoint, the trade deal would boost the markets and give the president more of a lift heading into 2020. >> marc, you've long been the white house's eyes and ears on the hill yesterday axios said mnuchin has privately been telling people pelosi has promised to vote on nca by october her office says that's patently false. is that going to happen? >> we think it's going to happen this fall, carl. we're disappointed it hasn't happened yet the reality, because of the
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budget cap deal, congress is going to be in more this fall than they have previously been so it gives us more of an opportunity to complete it pelosi will only bring it up for vote if she thinks it's in the best interest of her members when you see where vice president has been traveling, wisconsin and districts, where the dairy product has been greatly enhanced by this new deal traveling to michigan to talk about benefits to auto manufacturer workers today he's in ohio visiting a company, a canadian company building a plant in the united states for auto parts because the auto part protection provided also travel to districts, new mexico, represented by a democrat who needs to get this because of all the gas and oil exploration. you look at our strategy, it's to go into districts occupied by democrats to convey, this is needed for your own constituents that's going to be the key to getting nancy pelosi to bring it up for a vote.
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if it's up for vote, we have nuf to pass it, enough democrats to say to pelosi i need this for constituents and better than what nafta is. >> are you guys calculating an actual economic boost in the usnca passed, a market boost >> absolutely. liu at what data has been put out to date, studies show it would boost gdp, also the number of jobs by tens of thousands so yes, we think it would. also to go back to your other question about china, if we can get a trade deal completed through congress, mexico and canada, it gives a lot more assurances this administration is looking to complete trade deals and a template for what we can do with japan, in europe there's many more that isolate the challenges we have with china. >> marc, your point about business investment is key because it's now a negative drag on gdp for the first time in a couple of years despite the tax cut. everyone points to trade
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uncertainty. does the white house acknowledge that it is a drag in part because supply chain managers are nervous? >> you know, carl, i don't know. i think you go back to 2017, 2018, it would be difficult to keep that pace up because of the pulling back on regulatory restrictions put in place by the obama years and tax relief certainly that created incentive for a lot of those investments to be made in that immediate window but we still think the economy remains very strong. you know, the cbo when we passed the tax cut projected 1.6% gdp growth over the ten-year window and we're far surpassing that and will continue to as i said, vice president today back in ohio at a company that's foreign direct investment, a canadian company building a plant in ohio. we think there's still plenty of opportunity for additional investment in the united states. >> quickly, marc, we're on the eve of another fed meeting we continue to hear the president just slam the fed for
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keeping interest rates too tight yet data continues to come in strong you heard at the top of the hour, better consumer numbers, better housing numbers p&g just had its best quarter. one of the biggest consumer companies in the world just had its best quarter in years. so is the president playing politics, having a scapegoat, the fed for not having 3% annual growth that he promised? >> i think it's more of a disconnect that talks about what the fed's mission should be. in our mind the fed should be focused on inflation and there's not been evidence of inflation we know what happened throughout 1907s, '80s, anyone 90s, adaptation to phillips curve when you begin to see employment increase that necessarily inflation will follow. therefore, the fed wanted to get ahead of that. we're enjoying record numbers of unemployment, 3.7%, the lowest in 50 years but there has not been inflation that followed that we think the fed should be focused on the inflation part. it's also a relative question, sara, you look at what's
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happening internationally, what's happening in europe, they have lowered their interest rates so significantly that relative ours is sort of out of whack. we think the fed should be more focused on the inflation side of that than the jobs part and leave fiscal policy to help fix job situation and continue to keep the economy as strong as it is. >> the inflation angle is definitely where the doves have some of their best ammo many argue. marc, thanks for the visibility on this, hope you'll come back. >> thanks nor having me, carl. >> marc short. speaking of, fed kicking off that two-day meeting, day one today. steve liesman joins us with the latest results from cnbc fed survey good morning, steve. >> yeah. good morning we'll get to the split between doves and hawks in a second. first, the outlook for stocks in our cnbc fed survey. you can see where we were. the outlook for 2019 back in our june survey kind of down beat. it's come up a bit with the market, looking for 3059 by the end of 2019. let's look what that means relative to where we are and
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where we're going. currently close yesterday up to 3067 by 2020, 5% not too bad relative to how it could be. that comes in a context the respondents think the yields have overshot where they are going to be. obviously the outlook for yields has come way down over time. we're at 205 now over time they think there's a little bit more rise in yields coming that comes by the way with a little bit slower growth this is what's built in. take a look at the growth outlet 2.05, 2.4, 2.1 growth around that number there. in and around potential but not a recession in the offing. talked about the split on the street over this rate cut. everybody thinks the fed is cutting rates but differences of opinion whether the fed should cut rates. 48% say the feds should not cut.
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50% -- there were 41 respondents, by the way. 50% said they should cut, total 13% said should be 50, most think it's going to be a 25 basis point cut. here is some of the split out there. chief investment officer offarden sed rate cut not obvious economic data as sara said has not been weak enough, rates already low. lindsey from stiefel says cautiously being for troubles is the most appropriate pathway near term. guys, we're going to be arguing about this for a while but all the argument matters not much because i think the feds are going to cut rates. >> steve, i was going to ask you earlier in the week the "times" did a piece on concessionary caters one when consumer confidence falls 15% that's not the way confidence board is going. >> increase in spending numbers, they are good. confidence numbers were good the one weakness in the economy
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if you're just following the data is the capital spending numbers. of course those are based on higher numbers from 2018 the corporate profit numbers also are on the weak side. it's going to be very hard to have the kind of weakness that you might expect in the face of a rate cut look, carl, i think thinking about this rate cut in terms of actual economic data is very difficult. the best way to think about it is an insurance cut. >> yeah. also inflation, marc short. >> argue about how much we're missing and whether or not -- with that administration official -- >> what direction. >> that administration official just on your air changed the mandate of the fed they want to focus on inflation but the fed mandate is both inflation and employment. >> they want to focus on overseas rates as well steve, thank you. >> thanks, sara. >> when we come back, capital one under pressure after getting hit with a massive data breach we'll have the details next. later, you'll hear from u.s.
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secretary larry summers. his thoughts on this controversial fed cut. trade tensions and more when "squawk on the street" comes back dow down 49 points your daily dashboard from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time...
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capital one getting hit with this massive data breach more than 100 million customers compromised. our aditi roy has the latest. >> hey, carl, a staggering number of people affected bit hack, making it one of the largest on a bank. federal prosecutors say it was carried out by 33-year-old
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former software engineer page thompson who worked for amazon web services which hosted the capital one database it affected 6 million consumers in canada, about 140,000 social security numbers were stolen, and 80,000 bank account numbers as well. so personal information from credit card applicants, including names, addresses, zip codes, phone numbers, e-mail addresses and dates of birth also customer status data like credit scores and payment history. capital one says the breach will cost up to $150 million. cyber security is, of course, a top concern in banking jamie dimon has said jpmorgan, which was the target of a 2014 spent $6 million on defenses of he said it may be the biggest risk to financial system it comes one week after equifax settled its claims for a total
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of $650 million. sara, back to you. >> aditi, thank you. beyond meat gets burned this morning after surging 800% since its ipo. shares are down more than 10% this morning following the company's mixed second quarter earnings report. joining us by phone with his outlook on the market for meat, the bank's global strategist for animal protein that's a cool job, justin. thanks for phoning in. >> my pleasure, sara, thank you. >> shares took a dive last night when we found about about secondary offering talk about what's behind that move the company is making. >> i think if you kotb plate what's ahead at beyond meat, the work they need to ramp up production, the work they need to keep growing sales in the retail channel, the work that they need to do to keep rolling out their global or meeting their global expansion plan there's a lot of work to be done there. secondary shares to raise
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capital to invest in those important areas really shouldn't surprise any of us in terms of what the work ahead of the company is. >> do you think it ultimately changes the trajectory of the stock which had been on a one-way ticket higher since the ipo. >> i can't comment on the stock price. the markets have really appreciated the stock clearly. we will know that. if you're an impact investor, sustainability, environmental government, esg focused investor, you don't have a lot of places to put those funds there's a lot of reason people in the market have appreciated stocks you think about the earnings multiple, it's hard to contemplate where that's going to end up. it does not appear to be online with consumer food company or especially not an animal protein company if you think of some of the listed stocks like hormel, like tyson, for example. >> what about the revenue
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growth that's clearly what's so dazzling to investors. almost 300% in total almost 500% with retail and restaurant -- restaurant and food service partnerships. is that sustainable? >> well, that's the most important question it's not easy to form a view on that they will keep growing revenue for sure because they have got a reasonable product and good position in the market consumers are enjoying the product. remember, consumers are experimenting here a little bit. we're seeing consumers try something different to animal protein, to chicken, to pork, to beef they have grown up on and become quite used to some of those people trying the product are loving it, bolted on and are going to stay with it forever. i think the largest group of people who are continuing to try this are still kind of curious and still sort of going with the trend and still trying to form a view whether this is going to be
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a regular part of their shopping basket so beyond meat to continue to perform as well as it has been performing, it's going to have to convert lots and lots of those curious consumers into bolted on permanent part of the shopping basket type consumers. >> you don't sound fully convinced on the long-term justin, thanks for phoning in. justin sherrard, rabobank. >> ahead of the democratic party for tonight's debate, a check of the market, dow opened down 150. losses cut in half losses cut in half we're back in a moment (in dutch) it's happening..! just ok is not ok. especially when it comes to your network.
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hurry into the mercedes-benz summer event today for exceptional offers. lease the glc 300 suv for just $419 a month at the mercedes-benz summer event. going on now. welcome back, everyone i'm sue herera here is your cnbc umt at this hour president trump warning china against waiting out his first term in office to finalize the trade deal saying if he wins re-election, china will get a worse deal this as u.s. negotiators arrive at a luxury hotel in shanghai to begin another round of trade
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talks with china. two people killed and a suspect and a police officer shot at a walmart in the northern mississippi city of south haven. the shooting prompted a sizable law enforcement response the police officer was not seriously injured and the suspect was taken to the hospital. a small pakistani military plane crashed into a residential area before dawn this morning killing 19 people including five soldiers rescue officials say the death toll could rise since there are injured in critical condition. asap rocky's mother and lawyer arriving at the stockholm district court as the rapper's trial got under way. he pleaded not guilty to a charge of assault. the rapper was detained earlier this month in connection with a street brawl president trump unsuccessfully tried to intervene on his behalf you are up to date that's the news update this hour sar ark, i'll send it back downtown to you. >> thank you. etf spotlight looking at consumers staples etf, xlp
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closing at fresh record highs. yesterday continuing the climb, leading etf hershey up over 13%. kellogg on pace for its best month since 2009 p&g lifting sector today now trading at an all-time high after earnings beat, 7% organic sales growth as i mentioned, strongest in 13 years. ceo david taylor of procter & gamble jiang me today for a cnbc exclusive. a lot of these slow growth boring defensive companies, carl, not looking slow growth. >> proctor on pace for the best month in six years. >> the winning dow. >> the fed kicks off a two-day policy meeting >> the fed moved in my opinion far too early and far too severely it puts me at somewhat of a disadvantage fortunately i made the economy so strong that nothing is going to stop us but the fed could have made it a
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welcome back to "squawk on the street." president trump continuing his attacks on the fed this as it kicks off two-day policy meeting. joining us now treasury secretary larry summers. welcome mr. summers, i know you're not a fan of the president's constant bashing of the fed and easing you have been in the eadsing camp yourself. do you think the fed has strengthened or weakened in the last months for the fed to cut rates this week. >> i think the case is stronger. inflation does am quiescent.
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there's a question where the economy will go in the future. the risk of a cut seem to be lower than risks of staying where you are and risking a tip into recession i think the fed has gotten a reasonable place with 25 basis point cut and the possibility of another 25 basis point cut i thought the discussions of a 50 basis point cut are almost madness. that's the kind of thing you do in an emergency, which this is not. >> some of the criticism around cutting when the economy is relatively healthy, and, in fact, inflation has firmed up a little if you look at preferred pce, has centered around this idea of blowing bubbles, blowing asset bubbles in stocks and bonds, getting investors too reliant on fed policy for the fed to step in no matter what.
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how do you take some of those criticisms >> i think that's the right concern but i think you have to look at the level of stock prices, for example, in the context of the left of interest rates. once you do, that i think it's much less likely and obvious that we're in some kind of large scale bubble if i look across the range of assets, this doesn't seem to me to be a moment like the little of the last decade was, housing prices, like 1999 was in stock prices whereby any valuation they looked overvalued we'll have to see when earnings are in but i think a lot of strength in stock prices reflect a strength in earnings and reflects expectations of low
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interest rates rather than representing make kind of bubble. >> larry, are you expecting this war over the dollar and attempts to weaken the dollar to get more obvious, more overt in the coming year? >> i hope not. i think there's a risk of it i think when you signal that you don't want your currency to be stro strong, when you trash your own country for competitiveness, you raise the borrowing cost for every american home owner and every american company so i think it's something that operates to make the economy less competitive, less efficient, not more competitive and more efficient we always used to say when i was at the treasury, no nation can devalue its way to prosperity.
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that's ultimately about the quality of its institutions, the hard work of its workers, the entrepreneurship of its businesses those are the fundamental things we should be trying to foster. >> meantime on the fed, president trump just upping the ante in his fight with the federal reserve. earlier this hour, secretary summers, we talked to marc short, he's the dheef of staff for vp mike pence. here is what he said about what the fed should be cutting now. >> in our mind the fed should be focused on inflation and there's not been evidence of inflation we know that what happened through 1907s, '80s, '90s was an adaptation to phillips curve and believing when you begin to see employment increase that necessarily inflation will follow therefore the fed wanted to get ahead of that. we're enjoying record numbers of unemployment at 3.7%, the lowest in 50 years but there's not been inflation that's followed that so we think the fed should be focused on the inflation part. >> i mean, it sounds like you
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agree with him ultimately. but to hear the message over and over and over again out of the white house, how do you think that will ultimately impact -- >> let me ask you, why does it marck us as serious country, the white house chief of staff or vice president's chief of staff, who used to be the ahead of white house legislative affairs to be giving dispositions on monetary policy. never occurred to me when i worked in the white house on economy policy to discourse on legislative strategy or the vice president's political strategy this kind of thing, this idea that expertise doesn't matter, everybody talks about every subject that you can just wish what will turn out to be true is
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not the mark of a government governed by reason i think that's a very troubling thing. yeah, i think the fed is doing the right thing now, but i think the idea that directives for the fed or running fed commentary should come from the vice president's chief of staff i think is a bizarre descent for american democracy. >> do you think that there's a risk right now that the market is going to think that the fed is doing what the president wants, and that's a serious issue with consequences that risk its credibility >> well, i put it slightly differently. the most important thing that any financial policy maker has is their credibility if that credibility is sacrificed, their decisions are seen as not based on the facts of the economy, but on political
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pressure, then something hugely important that may be essential when the next crisis comes is lost that's what jay powell has to weigh every day because of what the president is doing he wants to do the right thing, and he wants to preserve his reputation for independence. when the president's random walkthrough opinions happens to land on one he agrees with, he's in a very difficult -- put in a very difficult position. so i think what the president is doing is profoundly irresponsible, and i don't think it's less irresponsible because at this particular moment i happen to agree on the desirability of a modest easing. >> to that point, larry, who would you say is pressuring powell more, the president with
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his badgering, or just frankfurt and japan and pressure on u.s. global rates >> i think -- i don't think being badgered by the latter at all. i think he's been egregiously badgered by the president in a very complicated international situation and domestic situation that has complexity given the length of the expansion and given some signs of slowing. i might just say, by the way, that if we didn't have the trade war, if we hadn't administered the sugar high to the economy with deficit busting but economy stagnating tax cuts of 2018, the fed would have a much simpler
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job. it's been greatly complicated by the policy errors of the president and his administration >> well, we know you've been critical of the fiscal policy of the administration just on trade, secretary summers, we did get a trade outline from senator elizabeth warren, and it feels like it's even more restrictive and protectionist than what we're seeing out of the trump administration not so much on tariffs but in terms of all the different milestones countries need to meet, especially on labor and climate to make a trade agreement with the u.s. are the obama days of democrats making multi-lateral trade deals done is this just a new regime in terms of how we're going to approach trade in this country from both parties? >> look, i think all of us certainly who were in the obama administration recognized that we were going to have to fashion trade agreements that paid more attention to main street and
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less to wall street, that were more about people from detroit than they were about people who gathered in davos. but i have to say i was quite troubled by the approach that a few in the democratic primaries are taking of essentially emulating are the president's policy except making them more imperialist, in terms of the number of demands we're making of other countries to conform to various of our practices i looked at senator warren's list there were a variety of them that the united states was not currently in compliance with while frankly i'd like to see the united states get in compliance, i don't think that a
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strategy of abrogating your trade agreements with people on that many grounds is a way to be seen as a reliable partner the united states has derived enormous benefit over the last number of decades, from being seen as a reliable partner for countries at moments when frankly china and russia often gave them reasons for distrust if we start matching that with our own hyper aggressive policies, we are going to lose allies from whom we gain a great deal. >> all right larry summers, thank you for joining us former treasury secretary of the u.s. "ua tnkou >>sqwk on the street" is back after this. don't go away.
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we're diving right into fed week what bit of a contrarian
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call on backs. find out more on trading nation on cnbc.com. more "squawk on the street" is coming up.
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corporate consolidation, a major talking point with the democratic candidates in the latest debate and likely to get some attention in tonight's debate as well leslie picker is live in st. louis, where many large hometown companies have been acquired in recent years we know which ones, leslie >> reporter: hey, that's right in recent years, storied st. louis companies like monsanto, express scripps, panera and scott trade were acquired in multi-billion-dollar deals since the last presidential election, in fact, more than 3.5 times more money was spent acquiring st. louis-based businesses than st. louis-based companies spent acquiring those outside the metropolitan area. there aren't really studies that show how this directly hurts the economy, but there are trends that this has not helped st. louis at all
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per capita growing much less quickly than the rest of the nation we spoke with johnny chambers in charge of handing out severance packages at anheuser-busch she recalls firing hundreds of workers at time before she herself got a pink slip. >> i wasn't urprised i was ready. i was emotionally exhausted and physically exhausted i was 54 it was time. so i thought i was ready, but in fact, once i got on the other side of carrying my box out of the building, i did my share of crying chambers is now a transition coach, where she helps other people who have been displaced by mergers some, she says, have gone through this twice or three times here in the st. louis area guys >> it's a good story interesting look at the consolidation trend. leslie, thank you. squawk on the street is going to be right back.
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dow is down about 57 points here four shocks will kill a man.
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yeah, i think we can take five. you had to open your big mouth. here's what i'm gonna do. i'm gonna smash him right in the face. kill all thirteen guys in three seconds. i'm gonna drop kick him. him, and him. no, no, no that's my guy. that's my guy. look at you the fate of the world is in your hands and you can't even get along. your momma. [ screaming ] welcome back to "squawk on the street." i would like to talk with my guests today, mark summerlan,
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evenflo, macro let's get right into it. the question of the day on the first two-day policy meeting is the premise of going along to preserve other central banks, europe and japan in particular is it a good premise to begin with in your opinion >> i think it is one of the things that goes into making policy and i think the risk that the fed has right now is that dxy might break out to the upside with dragi reloading and i think that the fed has to be careful to not let the dollar run too much during periods, so that they don't have unwanted financial tightening so they have a balancing act they have a pretty good economy right now, but they've got some signals from financial markets that suggest that they don't need to be any tighter right now and they just need to protect against that >> you know, data dependent, it was an unbelievable characteristic during the previous ten-year of janet yellen now, i think it's also gone from data dependent to model maneuvering. i guess in the big picture, is this a one and done or do you
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think that market arbitrage, flattening and inverting the yield curve and all the effects of overseas negative and low rates is something compelling for the central bank >> i think that they're probably going to end up doing 50 basis points cumulative over two meetings and the best thing that they could do then would be to take a break and go into the background and see how that sits and hopefully be able to stabilize everything around that but we'll see what they actually do, how they react >> history says, mark, that they move in long-term cycles, pretty hard to argue with is there ever going to be a point where the fed is more fluid? where maybe they raise rates, lower rates, raise rates and it's more fluid? final thought. >> i think this this is probais turn and we'll probably end up going lower next year, as well >> i got you mark, thank you for your time. carl, back to you. >> rick, thank you very much "squawk alley" is coming up next do not miss the ceo of tobacco
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giant of phillip morris international on a day where a lot of consumer staples are doing pretty well. dow is down 52 - stand up if you are first generation college student. stand up if you're a mother. if you are actively deployed, a veteran, or you're in a military family, please stand. i will tell you this, southern new hampshire university can change the whole trajectory of your life.
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good morning it is 8:00 a.m. at beyond meat
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headquarters in el segundo, california it's 11:00 a.m. on wall street and "squawk alley" is live ♪ ♪ good tuesday morning welcome to "squawk alley." i'm carl quintanilla with morgan brennan. there's a lot to watch today, but we're going to start with beyond meat, getting hurt in today's session after mixed result in the announcement of that secondary share offering. aditi roy has all the latest this morning from san francisco. hi, aditi. >> hi, carl. the stock is down despite the company posting some strong numbers on certain metrics

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