Low. Investors now down about 18 from the ipo price and its not just uber and this is definitely not music to investors ears, shares of chinese streaming giant ten cent are down sharply well tell you why onthon tuesday, august 13th as Worldwide Exchange begins now. Get along down the road weve got a long, long way to go scared to live scared to die we aint perfect but we try good morning, or good afternoon or wherever in the world you might be watching. Thank you for joining us here on Worldwide Exchange between the continued protests in hong kong and sharp drops for bigname stocks, it could be another busy day in the Global Financial markets and for your money. After yesterdays nearly 400 point drop for the dow, futures are trying to stay steady. Theyre flat across the board. But remember, this time yesterday we really had a similar situation and we had some of the headlines coming out about the hong kong airport closing, futures dropped, markets weakeneding down nearly 400. Stocks air big story but bonds perhaps the bigger global story, not just here but around the world yields continuing to fall. Theyre up a little bit right now. Were at 1. 65 and, again, this gap here between this 1. 58 and 1. 65, thats the yield curve if this goes above that, that, some people say, is a big warning sign we are getting close right now we are just what they call seven basis points, basically seven little one hundredth dollars of o that inversion and China Central bank setting down official midpoint for its currency, weaker than 71 to the dollar for the forth straight session. Course all of that happening as protests continue in hong kong and thats rattled the asian markets, particularly hang seng, one of the most important markets not only in asia but in the world, down another 2 , solidly negative on the year the nikkei and japan gets hit along with the carnage down 1 shanghai held up a little bit better, but the hong kong hang seng the index to watch. The european markets maybe more reacting to us theyre down, yes, but maybe. 2,. 3 right now not big losses outside of stocks, again, we are seeing oil up just fractionally but still at 55 bucks. We have hellema kroft coming on. And gold, reigns around the world. Gold one of the topperforming Asset Classes of the year. Up nearly 20 in just 90 days and up again today to 1535 the real question is this about the you watch cnbc every day, you hear us talk about so many Different Things what are the key things weighing on the markets and your money right now . Lets talk about it. Youve obviously got now the protests in hong kong. Theyve been going on for months and theyre getting worse, in fact, the airport now open, but closed yesterday and we expect more closures or at least protests coming up. Youve got the trade war, which continues outside of the protests so that has strained u. S. china relationships the european banks, doix bank, commerce bank, credit of italy, their shares are at or near multiyear or alltime lows a lot of attorney about the health of the major u. S. Banks dont forget about the clock ticking on brexit. We havent talked about it a lot lately because of Everything Else going on. But brexit, were pointing to october, we have Boris Johnson at prime minister, brexit is still a major global story and last but not least, stock valuations you look at the just the valuation of our market with recent declines Going Forward and some people say well, these valuations may be a peak you heard them talk about at the top of the show yesterday. The market cap of our markets to gdp is at the same ratio, about 140 gdp as it was in 2007 and as it was in 1999. So valuations just generally do remain a concern lets now talk about all of this joining us once again, jeff h, theres probably four or five more things i could have put on there, bond yields, we only have so much room on that wall, but it shows how many things are outstanding right now to you either on our wall or Something Else what is your main number one concern right now . I think its the trade war. I mean, hong kong i dont think is impacting the markets directly as much this trade war is what the fed has said is the reason that they cut rates. Powell says trade uncertainty, trump wants more rate cuts, he gives them more trade uncertainty. Im more concerned about the trade war than hong kong per se right now. Listen, again, on that wall we could have put fed concerns, has the fed screwed it up . Are they miscommunicating or mismanging this. Clearly miscommunicating. Is if fair so say the trade war and the fed are kind of one in the same right now . Oh, yeah. I think so i mean, thats because theyve got to react. Theyve got to Pay Attention to that. The fed chairman himself was the one that said easy thats the things that were creating the uncertainty for them and their job is to manage inflation, one of their jobs and if the tariffs kick in on september 1st on the consumer goods, inflation is likely to rise so theyve got to react not only sort of psychologically, but to their edict about after years of trying to get inflation to rise, now its going to rise a little bit and theyre going to get all crazy and start cutting. I mean, its probably going to happen i dont necessarily think that we need to have a lower rate situation right now. And i think that the feds has a communication problem. But the thing that were look at also is this recession risk, the fear of the yield curving version. The research we did showed that not really until the fed funds rate kicks up above the 30 year that youve got that clear recession rate everyone started jumping the gun here a little bit and making headlines and talking about this twoyear, tenyear. I hate to use the term basis points at 5 07 in the morning. Its a bit much. Were talking about 1 , these little blips but we are now just seven, i said it, basis points away interest that inversion on 2. 10. Not that its a great its not a hands down recession coming thats the big debate right now, which is is the bond market flashing that big recession signal or do our yields keep falling because our bonds keep getting bought because nobody around the world is getting any yield anywhere else . I think thats more the case than the recession the bond market, were the place to be right now. Weve got to come down to the rest of the Major Economies in the world. I think thats whats happening. And the pressure from the white house is not something to, you know, scoff at its not necessarily verbal stuff. Hes going to do things that are going create stuff that he wants. Its a classic electioncycle behavior were talking about how the government manipulates to say in power in the is an incumbent president to get reelected and it drives things. There is a school of thought, i dont know if youre in that classroom or not, is we could get some kind of favorable end to the trade fight early next year right around the time things are heating up. But i think the reason i bring it up is not politically, theres a big sort of in the market, still because remember, were still up what . 15 to 17 on most of the major averages this year. Yes. We need to put it in context that theres a bid putting a floor into the markets because people sort of quietly expect this favorable outcome for political reasons. A sneak preview in the 2020 alma knack, sitting president s running for election versus all election years versus open fields no sitting president. Sitting years without somebody running 10 . All election years 5 . And minus 1. 6 for open field elections. So there is something to the power of incumbency there. Sitting president s going into reelection running for reelection. Running for reelection tend to historically, this is what you guys do better than anybody else, i hate to use goose the market prime the pump. They do better . Yeah. Because a lot of maybe promises were seeing the democrats promise a lot. Trump may come out and start promising a lot . Youve got a psychological situation where, you know, theres somebody getting reelect and theres a lot of drive to make that happen. And thats what does it. It is august too were look at a seasonally weak period everyones talking about it now. We came in prepared for this. Yeah. Weve been Market Neutral since midjuly theres a couple of short days in there and its set up pretty well the whole years been tracking seasonally quite closely and i think it continues which means good things for the end of the zbleer you still remain optimistic toward equities at the end of the year . Look at the end of the seasonal patterns, its almost to a t to me that tells me its going to keep track of the seasonal patterns. A lot of our viewers and listeners are hoping youre right. Were down 3 this month on the dow. But theyre saying this is a month to forget. Worst month since 88. First Probabilities Fund management, thank you. And of course the Stock Traders alma knack. We mentioned investor nervousness about the situation in hong kong what right now is the situation in hong kong is the airport reopened . Where are the protests lets join now nbcs matt bradley with more. Matt. Reporter hey, brian, you know, its looking a little grimmer and grimmer as the day goes on here as you can see, theres tons of youthful protesters who are now not in the arrivals hall but in the departures hall. Theyre blocking people from checking into their flights. And behind them are all of these luggage trolleys theyre using this to try to keep people from just checking in and this is exactly what caused the problem yesterday when they fully shutdown the airport and canceled hundreds and hundreds of flights now, there are still people checking in, as you mentioned the airport is open. But it doesnt seem like its going to stay open might actually shut down because weve been hearing on social media that protesters are asking that people who get off work later in the day, its only 5 00, that they come straight to the airport and participant in this massive act of obstruction. Now, what would that do . Closing one of the worlds busiest airports for the second day in a row, it would be unprecedented and it could really cause knock down effects for the economy of hong kong every flight thats canceled, every passenger who doesnt come here, that also means a hotel stay, a restaurant order, a taxi fare its a very, very complicated situation and one that could really start to work dense the protesters the protesters say that this is worth it, theyre willing to pay the price if hong kongs economy goes downhill. But a lot of the older folks here, the ones who are working and providing, they might not agree and their patience might start to be wearing thin brian. Are flights currently arriving into hong kong airport . Reporter yeah. Were seeing planes landing and passengers getting off and coming through immigration but, you know, its hard to see how that continues these people in both the departures and the arrivals concourse, if more comes out and theres thousands and thousands more than the thousands and thousands that are already here, they could do the same kind of obstructive action they did yesterday and shut down the whole airport all over again brian. So, matt, obviously hong kong a lot more than just an airport, its probably the leading Financial Center of asia, one of the leading Financial Centers of the world, trillions of dollars of business goes through there every year whats the situation in what they call central and mid levels and causeway bay are people work something are the Financial Markets functioning there right now . Reporter yeah, the Financial Markets are functioning but theyre reeling from this. You know, the hang seng has been dipping. Its a very, very bad situation financially. And carrie lam, shes the chief executive here she came out and she said this is really causing a damage for the hong kong economy. She was pleading with the protesters all week and she had some of her financial people coming out and saying the same thing. Now, were getting pushed around here because a lot of these arriving passengers are very upset and theyre not theyre not waiting for us and theyre not waiting for the protests in the is kind of becoming a bit of a tinderbox. Excuse me. And this could set off at any minute there are no police here, brian. Its not a problem yet but there are police behind security and if the passengers start to scuffle more with the protesters, we could see some real props here in one of the busiest airports in the world. Biggest 202,000 passengers a day on average we appreciate it well see you all day on cnbc. Thank you very much. All right. Dramatic scenes there. When we come back, this mornings main stocks that you need to watch, including a new ceo. An whats the health or lack of commerce banking deutsch bark and eurocredit down 30 in the last year well tell you whats going on and why he that situation could spell big trouble for the Global Markets as well. It is a global wall of worry and you are watching Worldwide Exchange right here on cnbc. You should be mad that this is your daily commute. You should be mad at people who forget theyre in public. And you should be mad at simple things that are unnecessarily complicated. But youre not mad, because youre trading with e trade, which isnt complicated. Their app makes trading quick and simple so you can strike when the time is right. Dont get mad, get e trade and start trading today. Were pretty different. Were all unique in our own ways. Somos muy diferentes. Muy diferentes. vo verizon knows everyone in your family is different. There are so many of us doing so many Different Things. vo thats why verizon lets everyone mix and match different unlimited plans. Sebastians the gamer. Sebastian. This is my office. vo and now with more plans, everyone gets what they need without paying for things they dont. New plans start at just 35. The plan is so reasonable, they could stay on for the rest of their lives. Aww, did you get that on camera . Thanks, dad vo the network more people rely on gives you more. 5 fen seen it here on the east coast not just all about china and global macro concerns. There are some important and individual stock stories to Pay Attention to today involving streaming music, cook at home, and a big change at the top of the home of nacho fries. Well have a look at these stories. Good morning, brian lets start with fast food and yum brands the parent come of kfc, taco bell and pizza hut is promoting coo david gibbs to the top job gibbs has been with the company for 30 years creed has been ceo since 2015. You can see shares of yum brands this morning unchanged andlet stick wi and lets stick with food. This stock is up 6. 6 . This is the best day in seven months the Meal Kit Delivery service recording its quarterly profit since going public two years ago. And also the broader international markets. News comes just days after its rival blue apron posted weak results. And music is following sharply, the stock is down 3. 1 pes. The Chinese Media streaming service posting, brian, the slowest growth in average revenue per user since the ipo next year. Big stories there well see you in a few minutes still on deck, its not just china. Another country seeing its krunssy and markets take a massive hit yesterday. Should you add this to your global wall of worry plus, what is happening in europe rates there falling nearly every day. Well, the european banks, some of the biggest in the world damage our markets here . Analysis and insight with Larry Mcdonald coming up fun fact 1 in 4 of us millennials have debt we might die with. And most of that debt is actually from credit cards. Its just not right. But with sofi, you can get your credit cards right by consolidating your Credit Card Debt into one monthly payment. You can get your Interest Rate right by locking in a fixed low rate today. And you can get your money right. With sofi. Check your rate in 2 minutes or less. Get a nofee personal loan up to 100k. Take prilosec otc and take control of heartburn. So you dont have to stash antacids here. Here. Or, here. Kick your antacid habit with prilosec otc. One pill a day, 24 hours, zero heartburn. Welcome back you can add yet another argumen to that wall of worry we showed you before yesterday was one of the single biggest declines in the history of Global Stock Markets ever the argentinian industrial jones collapsing 38 in one day. This after the president was dealt a major defeat in a primary election against leftist Alberto Fernandez whos running mate is former president and nationalist Christina Kirchner argentina stocks tanking on monday all of this comes with concern that if the leftist government takes control, argentina could once again default on its debt insurance on the debt showing a 75 chance that that could happen banks stocks around the world have been under pressure here and globally amid unsnernt argentina, hong kong, europe, the uk and here. All as bond yields fall. About a quarter of the worlds sovereign debt now has a negative yield this has been reflected the most in europe. European banking index, the stocks europe 600 is at its lowest level since 2016. Many of the big names that you know are at or close to alltime lows lets bring in Larry Mcdonald, editor of the Bear Traps Report and cnbc contributor with everything going on with the trade war and now with hong kong and maybe yesterday with argentina, larry, i feel like if that wasnt happening, european banks would probably be our top story every day. Well, you know, we have to look at the world over the last six years. Weve seen kind of marketfriendly, populous governments come into the fold argentinas a perfect example. And now youre seeing the transition over to the left wing where there are markethostile governments coming in. If thats a trend through latin america and now we have that risk in america itself, right, it wont be the same type of credit risk, but all you need for equities to have a real problem in the United States is the probability of a left wing market foe government coming in to the United States or other countries around the world and then equities have to reprice really quickly. How worried are you about heres the problem with european banks. Equity doesnt always tell the story. Wed like to think the stock market tells the story it does to a point the stocks of these banks have been terrible. Commerce bank, deutsch bank, euro credit are the big three. Their stocks are at alltime lows do you feel that the stock market is adequately or maybe overreacting to the real health or lack of health of these banks . Well, heres a case where the eufn, which san is an etf that a lot of these banks has been pricing in whats called a cram down in a capital structure say a bank youve got debt and equity and that equity value of that pie has been crammed down and crammed down and crammed down for, you know, going on six, seven years. Listen, this bear case is the most prevalent, well known bear case i think in the history of capital markets. You want to be buying things like european banks down here. Sure, youve got more down side. But if your assume late banks over the next six to nine months and hold them for two, three years, youre going to be in a very, very good spot. Why are you so confident had that, larry . Because theyve gone down, down, down. Ill tell you why because the european governme s governments, especially in the north, have been smoking in the dynamite shed. Theyve been really theyve been sitting back and watching mauerio fire bullet after bullet after bullet, blank after blank after blank destroying these banks. Negative yields on almost 100 of german bonds, 100 of denmark bonds in the is insanity they have to sit back and do a fiscal plan, which they will do in the next six months lay off the Central Banks. Lay off negative yields. And then youll see once that beach ball which is pressuring these banks, this negative yield overdose, once that reverses it self over the next six months because youll see a fiscal plan in the uk, fiscal plan in germany, fiscal plan that will revive these economies, these banks will soar in a massive countertrend. Let me ask you this lets switch down to the southern hemisphere. Argentina, second biggest oneday decline in the history of any modern stock market ever. Now, theres a one hundredyear bond that was sold 100year bond yielded 7. 9 when it was sold with the drop yesterday, it about 54 cents to the dollar i think the yield on that bond, correct me if im wrong, is now around 12 everyones desperate for yield would you take a flyer and buy that argentinian bond to try to get 12 on your money . Well, think about it the bontd has gone from eighty 5 cents on the dollar to 50. Youre talking about 30 point loss across all the debt in argentina. Youre talking about close to 50 billion of losses this week. And i wouldnt touch that bond because i dont trust christina and mr. Kirschener. I think overall there are someplaces in the bond Market Global that i you can look at. But net, net, theres too much money crammed into negativeyielding bonds and that has dislocated the credit risk of many, many governments. So, in other words, two weeks ago, three weeks ago people were piling into this hundredyear bond and now as you see left wingers coming in, leftwing risk, now the money flying out as fast as it came in. Yeah. I wonder if that i think its 12 or whatever now yield on that hundredyear bond is going to lure some gamblers in theres a 75 chance of a default based on the credit default swaps. 54 cents on the dollar but 12 could look pretty tasty. Well find out larry, always appreciate your views. Thank you very much. Thank you coming up, a man just got an entire delta flight to himself that sound like heaven were going to tell you how he did it, but first heares your stat of the day. 58 of all s p 500 Companies Carry a higher yield, the dividend yield, than the yield on the tenyear u. S. Treasury note you wonder why people might come into stocks, forget about the price of the equity, they might be looking for that yield. E ckith more right after this welcome back we have breaking news right now from hong kong and another developing story there local media now reporting that the airport there has suspended all checkins. Arrivals are still happening, but checkins have been suspended. Now, the Hong Kong Airport Authority says Terminal Operations have been seriously disrupted because of the protest. Cathay pacific, which carrier of hong kong, says theres a potential for further flight disruptions or short notice. We showed you earlier how thousands, maybe tens of thousands of protesters are staging a sitin in the departures hall. They are saying all checkins for departing flights have been suspended. Flights still are arriving lets get a check on this mornings other top headlines. And for that we go once again to phillip mena in new york good morning. Jeffrey epsteins death is by no means an end to the investigation into his alleged sex trafficking ring fbi acts raided the former Financiers Private islands in the caribbean for evidence in the case meanwhile, theres growing scrutiny over his apparent suicide. The attorney general saying there were, quote, serious irregularities at the federal jail where the accused sex trafficker was held. If you ever wondered what it would be like to fly on a private jet but without the huge price tag . One guy got a chance do just that he says that through some sort of glitch he ended up being deltas only passenger on this flight he was flying from aspen to salt lake city. He does have the diamond medallion status which is deltas top tier and delta says they were more than happy to give a frequent flyer a one of a kind experience. And check out this guy in arizona here he knows real thiem in he caught this monster catfish weighed over 50 pounds he sent a picture of this to the Arizona Catfish Conservation Association for their fat cat challenge. He later released that catfish back into bartlett lake. So this is a catfishing story that we like to hear, a hope happy ending. It looked like the catfish didnt want to let go. It looked at the end of the video erics hand was sort of catfish are notorious, theyll eat anything. 50 pounds, that things huge. Tough times in aspen, philip. I think you and i should go out there and do some deep investigation into whats happening in aspen. Im down. Sign me up. Appreciate. see you soon. All right. Coming up, inverted yield curves and why you care. Before your eyes glaze over, look at this tenyear yield looks set to the fall below the twoyear yield. Why do you care . Because history says that could be a very bad sign for the American Economy the full story well make you smarter 5 34 in the morning. Were back right after this. Did you know you can save money by using dish soap to clean grease on more than dishes . Using multiple cleaners on grease can be expensive, and sometimes ineffective. For better value, tackle grease with dawn ultra. Dawn is for more than just dishes. It provides 3x more grease cleaning power per drop, which cuts through tough kitchen messes, pretreats laundry stains, and even tackles grease buildup on car rims. Tackle tough greasy messes around your home, and save money with dawn ultra. Brand power. Helping you better. All right. Just like yesterday, we are seeing stock futures weaken. We came in, stock futures flat, maybe a couple points to the green. As this morning goes on were seeing headlines of course out of hong kong that maybe some departures have been stalled once again at hong kong airport. Their currency being set to 7 to 1 below the dollar for the fourth straight session. Futures are weakening. Just remember this, im not taking anything away from this very fine program. Stock futures largely are traded by u. S. Traders. At 5 37 in the morning their watching Worldwide Exchange from probably from home or listening from their car so as they come into the office, you really start to see the volumes ramp up around 7 00 in the morning and once again, we are seeing futures sell now. Were down another hundred points after yesterdays 300 plus point nearly 400point drop on the dow. Despite the wild market moves that we have been seeing the last couple of weeks, your next guest has three reasons for some longterm, cautious optimism beginning with you. The still confident u. S. Consumer plus a Federal Reserve that will stand ready to take action, and the fact that the Chinese Government is likely to do anything to mitigate social unrest and limit the impact of the trade war. Joining us now is linda and she is Portfolio Manager and vp at federated investors. Linda, always great to see you you acknowledge that risks have increased but you are still cautiously optimistic. How cautious are you well, certainly, you know, last couple of weeks and the events of hong kong over the last couple of days have heightened that level of uncertainty. You know, what market hates is uncertainty and right now we are long on certainty and, hence, theres going to be a lot more people that are going to be a lot more investors that are going to be a lot more cautious. But you really do need to step back and look at the fundamentals of u. S. Economy and thats really driven by the consumer, as you mentioned, and also by the fed. And not just our fed, but global Central Banks that are easing around the world theres been more than 20 easings already and i think thats set to continue i feel like, though, in some ways, linda, were looking for our fed to be that knight in shining armor that comes in and slays the sort of global recession dragon and i just wonder if maybe this time the dragon wins, the dragon eats the knight because some people suggest the fed simply doesnt have that kind of firepower right now. Well, i think the fed probably does have more firepower than, you know, investors give them credit for certainly they can cut rates, theres easing, and im sure they can come up with other, you know, programs that, you know, we havent even thought about yet. So i think the fed is already thinking through this issue. Theyre not just sitting there thinking that this is the only policy tool that they have but, youre right. I think as we get longer through this stretch and the fed uses more of its bullets, i think we are going to be bound for more volatility and more really big drawdown days potential. I quickly, linda, what do we do do we raise cash what do we buy i think investors at this point should be really balanced and leave some cash, dry powder on the side to take advantage of those, you know, big volatile moves. What were doing at federated in some of our funds is being to raise cash in other funds we have using option strategies. However, within all of this i think you still can use, you know, some sectors Like Technology or some of the defensive sectors as stocks that can really outperform through the whole market cycle here. And you really want to concentrate on stocks that have strong balance sheets, strong cash flows that in case the worst does occur and we enter a recession in the next two years oar so, these companies can continue to pay your dividend and income and can come out of the other side stronger. Linda, sage advice, as always thank you, have a great day. Thank you. All right. Lets find out what else youre going to be talking about today. Its time for this mornings trending stories brian, have you ever lost your car keys. Have i. All the time. On this schedule, yeah, its like wax brain wheres my keys . Of course. Every morning but one tesla owner will likely never have that problem again because she solved her cars key card to access the chip, then have the chip implanted into her arm. Now, she can unlock and start her model three with the wave of the hand, no key required. I think its genius the only question is when she buys a new car, if its a tesla, will that work or do you need to put a new one in. Im very squeamish, thats a lot for me. I admire the gusto. That makes one of us. Even 25 years later, friends is still there for you, not just in syndication or streaming platforms. In honor of the 25th anniversary of the shows premier, they will show remastered episodes along with exclusive interviews and never before seen footage. Its basically the iconic episodes the weddings, births, that sort of thick. The one in which that show just prints money. I mean, it just prints yeah. Can we make can seinfeld come back to theaters . I would go see that. That would be cool. Totally olive garden. This ones for you . Yes, olive garden is back with the most popular promotion. The never ending pasta pass is back and it offers pasta and sauces for 10 and if thats not enough, they have a new twist theyre offering a 500 lifetime pasta pass thats unlimited pasta sauce, bred sticks for life only 50 are available, so theyll sell out fast. The passes go on sale this thursday apparently you sign up for the nineweek version and then you let them know if youre interested in the unlimit and they choose the top 50. Lifetime. Youve got to be careful with these lifetime, American Airlines found out a number of years ago and they regretted it. I assume people come in and order a lot of wine. So youre worried about the Financial Impact for olive garden. Because im a boring business journalist whofocuses on i want because your body, youre just an adon jonous naturally no carb worries for you. You should have seen me 30, 30 five years ago. Coming up, a new front in the trade war. Oil under pressure tension between the u. S. And china wrapping up. The great, the knowing, all powerful lima kroft is here to shed some light on what the heck is happening everywhere around world. Stick around applebees handcrafted burgers now with endless fries starting at 7. 99. And get more bites for your buck with late night halfpriced apps. Now thats eatin good in the neighborhood. Welcome back we talk a lot about the trade wars impact, across all sectors of the economy but what about its effect on energy remember, china is a major oil buyer and theyve been stockpiling inventory in response to the trade war. But how will this affect future demand joining us now is hake helima kroft. Weve got stop meeting like this so china, heres why we care youre not a china analyst, but china is one of the worlds biggest buyers of oil. Of course. If this trade war continues, if hong kong continues, i could see a situation where demand for oil into china decrease clrs means global oversupplies increase and thats a bear scenario for oil. Of course china was the engine for growth for all commodities. What weve seen is with the trade wars starting commodities have been especially hit by this the chinese were stockpiling aggressively in the first half of the year. They understood what was coming in terms of venezuela and iran sanctions. They now have inventories that they can draw down from and slow their purchases. Chinese oil demand was a real pillar of holding this oil market up for the first half of this year. If that goes away, Oil Prices Going to struggle putting a lot of pressure on countries like saudi arabia in terms of what you do in terms of response. 2008 we had the last big demanddriven price collapse remember oil at 147, crashed into the 30s opec certainly pulled 4 Million Barrels off the market over 12 months what do they do now in the softening demand picture. Answer your own question. I always get myself into trouble on your know what do opec do with a softening demand picture. The saudis came out and said were taking 7 hundred hundred thousand additional barrels off the market but the question is, do they have to do more . And can you get the rest do more and unlike 2008, now you have to deal with russia they have a copilot thats been reluctant to cut as aggressively as saudi arabia. This is the problem with russia we know its at 12. 3, 12. 4 a day. Russias like this great mystery. How much do you think russia is actually producing actually the opec members all say the russians never overpromise and underdeliver, they just tell you theyre not going to cut as much and the difference is the Russia Energy sector is dominated by corporate rates not a single company. And you have the head of ross net, hes never liked the opec agreement. Vladimir putin has to lay down the law and say you will cut this much. But they havent done what the saudis have done and the question is, if they need a bigger cumulative cut, how much more can you get the russians to do tanker tractors, weve had great work on iranian oil sitting out there in these ghost ships most of them bought by the bank and china. Yes. How much oil do you believe china has stockpiled thats sitting out there . How long can they go well, this is the i mean, that oil, is in storage, its not actually come into china the question really will be if we start to see the chinese trying to move more of those barrels into the country properly, does the u. S. Start to sanction more aggressively chinese refineries thats it. Chinese corporate banks i think this is where i dont think the chinese are going pull that trigger soon because that does potentially bring on a very, very tough u. S. Response its one thing to do shiptoship transfers its another thing to essentially say were going to play the whole sanctions regime up. This is why we talk about it. I think youre, as always, hitting on the key thing we are this trade war going on and pit for at that time in tariffs and no ones minimizing that but president xi in china and President Trump here they have warm words for each other publicly, which is good. If we saw the open purchase of oil, to your point, on the market, the u. S. Government has two choices. Ignore its own sanctions no, or take tougher action. Neither of which seems like a good outcome. I guess they would have to take tougher action because they have to show their backing but that steps up the trade war yet another totally now youre not shoving the kid in the playground, someone through a punch. You threw them off the slide. So the question is will the chinese do that. I think theyre more likely to do the shiptoship transfers, keep it more clan destin than to essentially say were going to totally glow up your sanctions regime, bring it on. All right thank you so much. Thank you. No, thank you. On deck, are investors hitting the brakes permanently on uber . Yet another dubious new milestone for the company. Well show outstock. If you own the stock, maybe go back to bed. Then, what is next for beyond meat . Your next guest says people are hungry for bond yields but is that overdone . re using all these burger insight right after this always wants to hang out. Neigr and you should be mad your smart fridge is unnecessarily complicated. But youre not mad, because you have e trade which isnt complicated. Their tools make trading quicker and simpler. So you can take on the markets with confidence. Dont get mad. Get e trade and start trading today. Dont get mad. There were tsunamis fourtin the world. And once they happened, we were in a major hurry to get to those regions to provide aid and support. It was very humbling to be able to help out all those people. Its my dream now to go into clean energy and whatever the next new fuel source is, thats where i want to be. I want to be on the front lines of implementation. Hey i live on my own now ive got xfinity, because i like to live life in the fast lane. Unlike my parents. You rambling about xfinity again . Youre so cute when you get excited. Anyways. Ive got their app right here, i can troubleshoot. I can schedule a time for them to call me back, its great you have our number programmed in . Ya i dont even know your phone anymore. Excuse me . what . I dont know your phone number. Aw well. He doesnt know our phone number you have our fax number, obviously. Todays xfinity service. Simple. Easy. Awesome. Ill pass. Milestone for the company. Welcome back time now for your executive recap. All the headlines you need, about 60 seconds theres a life shot of hong kong where all departing flights have now arriving flights are still arriving in other words, youre in the air, youre headed to hong kong, youve got a loved one, theyre going to land. Theyre not going to go anywhere else, theyre going to land. But if youre hoping to leave the airport, well, its not going to happen. For the second day in a row, all checkins have been suspended. Shares of uber disappointing after a Second Quarter results a few days ago and about doubts of long term profitability. Verizon selling blogger site tumblr it purchased tumblr for 1. 1 billion in 2013. Axios reporting the asking price is below 20 million. 1. 1 billion to 20 million. Not a good deal. All right. Back to the markets and your money. Are bonds the hot new stock . Your next guest says people are talking about bonds like they used to talk about beyond meat last month joining us now is jay jay ki kinahan. If you told me ten months ago that gold would be some of the hottest classes in 2019, i would have said go back to the pub but yet here we are. How shocked are you by this . Well, think just like you, sully, no one saw this coming, thats for sure. And i know you started the show this morning talking about only a seven basis point difference between the two and ten year certainly none of us would have suspected that you think its less than a year ago people were talking about a 3 ten year. So, but it feels as though that ten year people going out and buying that has become maybe more of a momentum trade even than a risk trade. And i think that thats really the surprising thing about it is it just seems like almost i hate to use this word, but too easy to just say, okay, im going to buy it because i know yields are going to go lower chairman powell may come out to Say Something to support this and keep that momentum going and that always just scares me a little bit when i see Something Like that. Do we still buy bonds is there still val threw, jj, they got overdone . Think one of the interesting things, i look at what our clients are doing, think the smarter play is people buying more shorter term. If we do get some sort of, you know, resolution of the tariffs and whether its good news or bad news on the tariffs, by the way, i think we just need some resolution. The problem being, companies are trying to play a game where the rules may change and the biggest thing that frightens me in what ive seen in earnings so far, nobodys talking about investing in infrastructure and thats really a tough thing. Because thats not the kind of thing that necessarily bites you in the shortterm. Yeah. But it does bite you two, three years later. And thats one thing thats missing. So with that i think, you know, seeing sort of shorter team, if this is settled, i think the Investment Opportunities start to present themselves quickly once you know what the rules of the game will be. So do our viewers buy tbills . When you say shortterm, like cash actually, anything i would say a year or less because, you know, your asking about keeping some powder dry. Youre not going to get much yield there. Or one of the other things is buying some of the highyielding sort of blue chip stocks theres a little bit of risk there. But at the moment its just its not a great tradeoff anywhere and when i look at people who are buying the ten year right now, sully, i think some of the motivation is a little bit different in mr. Buying it not for the yield but for the Capital Appreciation. Amazing Capital Appreciation on this. Really your recommendation, jj, is take some money, park if someplace safe shortterm, wait for that resolution that we hope will come . Right absolutely well, yeah and obviously its taking longer than we think. Youre going to have to be patient i think on that resolution it may take up to a year from now. So obviously if we knew these answers, sully, wed be probably somewhere else right now but its really its really a tough thing. It has been weve seen these markets move on hong kong, on Everything Else. Now jj kinahan, great analysis thank you very much. Have a great day. Thank you. It is another wild dow dow futures down again all flights out of hong kong suspended yet again. Theres a lot more do all day tomorrow squawk box begins right now. Good morning futures are indicated lower on wall street one day after the dow dropped nearly 400 points. The index is now off 5. 5 . The dow is the s p just less than 5 . News breaking, though, in the last hour. Hong kongs airport has success spe suspended checkin well take you there live. And were watching shares of uber dropping to an alltime low. Now about 18 below the ipo price on this tuesday, august 13th, 2019 squawk box begins right now. Announcer live in new york where business never sleeps there there athis is squawk box. Good morning. Welcome to squawk box right here on cnbc. Were live at the nasdaq markets. Guess whos here whos back in town, joe cernan is with us this morning, aloaning with kala becky has the day off. Im playing mediator today. Youre a buffer. Come on its nice to see you. Thank you. Theres bane lot going on the past two weeks. I know. Weve missed you, missed your comments, your insights, your thoughts. Theres a lot of things you know what, there are times that sometimes you just want to get you know, stop the world and get off. Yeah. And a vacation helps you do that a little bit. It was a rough couple of weeks, it was it does kind of impact