Have created a more cautious consumer billionaire tilman will tell us what that means for his business power lunch starts rite now. Wall street starting to trade like a tech stock hitting a record as it gets set to launch its competitor and gears up for a deal to by tiktok zoom up after 40 . Invest rs continue to pile into these momentum names more on the markets and high its hard out there, send it over to bob. Yesterday he sort of threw in the town he said theres no precedent to how high valuations can go with low rates and unlimited q e. John also wu drew his price target these are veterans having a hard time to figure out how to put unlimbed fed support recessions would happen when the fed withdrew the support what does it mean . One of the thing s the bare arguments dont have much traction now the fed will keep stimulating and the Global Economy is slowly pivoting higher and the earnings are too conservative this happened in the Second Quarter and they are saying it again. For 2020, were dealing with about 130 for the estimate for the s p 500. 2021, the estimate is 166. The bulls are saying this is too low. No stock sums up this phase of fomo momo, fear of missing out on momentum than zoom video. The stock is up 37 today. 550 this year even though we know were using zooming, it still blew past expectations i dont know if you saw it, it was an analyst note that used fomo and momo and tima zoom, not only did it blow past expectations, it beat the most optimistic wall street projections. It brought in more revenue than it did in all of last year i could go on. Ill mention one more great stat from our cnbc market muse. Take a listen to this. Zooms market cap gain this year is more than 100 billion. Only 7 s p 500 company vs seen greater gains in 2020. They are amazon, microsoft, facebook, nvidia and paypal. Zoom is in good company. All of those companies i just mentioned have diversified their businesses over the years from amazon in grocery to apple in services or paypal with venmo. Zoom is still known for video conferences. Some investors are starting to ask what is next to sustain its ever climbing valuation. Call it the cult of zoom you mentioned it shares are up nearly 40 today nearly 600 in 2020. Guy, i remember it like it was yesterday. It was just about year ago that this company went public at a 9. 2 billion valuation at the time, even that was considered pretty rich you remember not to throw you a question out of left field but beyond meat surging 800 its off those levels. I think its down 44 from those all time highs they couldnt sustain those levels and thats a business with one product just like zoom just sort of has Video Conferencing what makes i venvestors think t zoom will be different it almost feels like the beyond meat 2019. I think zoom participates in this incredible work from home trend. Its become a verb in a sense its a diversified not just into enterprise this was a consumer First Company in a lot of ways now into Remote Learning on the analyst call last night, one analyst actually brought on his daughter to say why she liked the feature so much when she was doing Remote Learning through her school its one reason that work from home trend the other one is its been able to maintain its market share with some of the tech giants nipping on its heels facebook, microsoft, google have tried copy cat products and zoom has kept its dominance it is working on new products such as a 600 device. Zoom telephone well see how those go but investors have their eye on it its become something of a verb this year thank you. Its also a noun in the sense of zoom tails. We used to get together to have zoom tails with our friends. With the bulls driving this ship and chasing stocks like zoom, will the fear of missing out on momentum continue to push the market even higher well, we really havent seen any crack in this momentum move. We havent seen even just the slightest hesitancy of the momentum stocks starting to slow down they are continuing to get higher away from their 50day and 100 Day Moving Average they continue to be leader not only in august which is lower volume but back in july. Until i see some sort of argument that there is going to be some sort of leadership elsewhere, i think you should run with it. Dont fight it there are a lot of Good Companies that, less risky than a zoom that still work well within the momentum space. Particularly your semiconductors, amd, intel all very strong Balance Sheets very good strong Earnings Growth looking ahead. I think these are safe bets with momentum world as long as were within this tina environment, i think going large cap momentum is actually one of your safer spends even though i agree with all of the cases that bob laid out for the bear market and the concerns i say run with it. Keep those stocks on board david, erin makes a convincing case to go the flow what do you say . We really would like to be more constructive on this market it doesnt make sense to us. You see cyclicals lead we asheaved beating that bar its going to take a sustainable treatment to get us there. Small caps and cyclicals leading will give us a lot more comfort about the sustainability of this advance. You seem concern the market has become disconnected from the economy. I picked up on erins point suggesting there are certain Great Companies that are leading not only the economy of today but the economy of tomorrow. We have learned what they are over the past year, over the past six months through this pandemic that part of the economy is healthy. It makes sense that the faangs, the googles and facebooks and amazons are trading the way they are because they are producing great Earnings Growth. If you take the broad market and take the five stocks out, were down year to date. The median stock is down year to date what does that tell you . This is not broad based. Again, we need to see the smaller companies. We need to see the cyclicals the companies that are hurting now. We need to see them come back and thats not going to happen until consumers reengage in the economy. Erin, you get the word last here and address davids very poignant point that the average stock is lorwer and not higher theres stocks that have been winners but have really strong Balance Sheets i think zoom is a little too risky. Thats what im talking about. Amazon, google, your semiconductors Strong Companies that have this momentum as long as were in this environment, go with it right now, i dont see other alternatives just yet. Im not talking pure growth. Im talking about momentum erin, nice to see you again you have some lovely art in the background thanks for having us into what i assume is your home. Daif david, thank you as well tyler never one to miss a good backdrop. Walmart hitting the dow higher shaping up to be the next text giant as it looks to by tiktok and launches its new service to compete with amazon prime. Mcdonalds facing a new lawsuit from 52 black former franchise owners this is the third Racial Discrimination suit filed against the fast food chient th giant this year. The lawyer representing them right afr is teth we made usaa insurance for veterans like liz and mike. When their growing family meant growing expenses, our agents helped make saving on insurance easy usaa. What youre made of, were made for. Usaa our Retirement Plan with voya gives us confidence. We can spend a bit now, knowing were prepared for the future. Surprise we renovated the guest room, so you can live with us. Im good at my condo. Well planned, well invested, well protected. Voya. Be confident to and through retirement. A lot goes through your mind. With fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. Thats the clarity you get with fidelity wealth management. Welcome back mcdonalds already facing an ugly lawsuit with its former ceo getting sued by some franchisees. A group of black franchise owners alleges discrimination. Kate rogers joins us with what they are alleging mcdonalds did and did not do kate reporter thats right. This group collectively represents more than 200 mcdonalds locations and claim the giant sent them on a financial Suicide Mission by steering plaintiffs to locations with low volume sales and higher operating costs including curt costs due to crime denying support to allow them to overcome financial hardships while supporting white franchisees with rent relief and impact funding dropping overall total plaintiff revenues mcdonalds that is in the midst of its ousted ceo said the company categorically denies these alleges adding that mcdonalds does not place franchises into locations but may suggest locations to them. Adding cash flow for black franchisees han s has been imprg the overall representation of black operators is broadly unchanged according to mcdonalds back over to you kate, stick around. We want to bring in the man representing the 52 black former franchise owners suing mcdonalds jim, thanks for being with us. Youve said that revenue at mcdonalds is based on one factor and one factor only, location do the franchise owners not have any say in where their business will be located . Walk me through that process they have little to know say in that process. You have to look at the history of mcdonalds. In 1969, blacks had to revolt to get their first franchise. Grudgingly after that, mcdonalds start to give some franchises to blacks where they decide to give them. They were primarily in black neighborhoods, low income neighborhoods, ghetto, tough areas. Over the next decade and a half, it became imperative that was a problem. Blacks approach mcdonalds through the National Black mcdonalds Owners Association with these beefs mcdomgnalds in the 90s, acknowledged these problems. They enter into an agreement in 1998 there were 377 black nan fr franchisees that owns. Today theres 186. Thats been cut in half over the last 22 years. At the same time, the number of franchises worldwide for mcdonalds has more than doubles, if almost tripled jim is this an example, in your estimation, that the cooperation is out of touch or do you just think they are doing enough we know the ceo has said to jim cramer the company has probably created more millionaires than on the planet. We know that black customers make up one fifth of the chains u. S. Revenue. Are they out of touch or just need to do more they are either out of touch or its false. When they made that statement it was june it was on mad money with cramer i saw that two weeks before that i had given them a draft of the complaint. They are aware of that think about that statement in the history of mcdonalds, maybe been a total of 600 black franchisees and to say they made more black millionaires than probably any company on the planet is false. Think of nba, nfl, nn the Dallas Cowboys made more black millionaires than mcdonalds thats false statement on bloomberg, the ceo, same ceo who came into office in november said they had decades long history. Five decades of doing the right thing. What i just talked about is well documented they announced the agreement and acknowledge their problems they did nothing than decrease the black numbers over the last 22 years talk to us about the damages youre seeking for the pla plaintiffs in the release you say between 4 and 5 Million Dollar per location how did you arrive at that number its fairly simple. At the relevant time period our people exited in the last decade. In revenue its only based on location in mcdonalds its not a french restaurant you want a big mac, you go to the closest mcdonalds thats how it works. What happens to that 700,000 the average life of the stores in our case is over ten years. The 700,000 is the last revenue. Thats the beyond break even refr kn revenue. Thats the revenue beyond 10 Million Dollar the cost of sales is 28 im being generous and up to 40 . Maybe some expenses went up. If you are generous and take 40 out, youre left with 50 which is shortfall of profit for year. Over ten years for one store thats over 4 million we have other components of damages too which is lost of investment value, debt that should not have existed at the termination date and things of that nature. The predom nants claim for damages would be lost profits. Well have to lever it here one to watch as mcdonalds deals with this but quite a few hr issues at the moment thank you both thank you very much all right. Still ahead, the dow off the high ofs of the session but walt is leading the charge up 5 as it launch a new Subscription Service to take on amazon. We have those details and more if its tuesday, its time for tilman he says he has just had his best week of business since the pandemic started hell tell us whats still keeping him up at night like e more power lunch after this. Right now, the worst place to be is stuck inbetween. Accelerate your investments or pull back . Change the plan or stay the course . Thats why Northern Trust is here. With specialized expertise. A history of success through every economic climate. And proven strategies rooted in data and analytics. Giving you more control. Clarity. And confidence. For now and whatevers next Northern Trust wealth management. At morgan stanley, a global collective of thought leaders offers investors a broader view. We see companies protecting the bottom line by putting people first. We see a bright future, still hungry for the ingenuity of those ready for the next challenge. Today, we are translating decades of experience into strategies for the road ahead. We are morgan stanley. A lot goes through your mind. With fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. Thats the clarity you get with fidelity wealth management. Welcome back to power lunch. Walmart ripping higher after announcing the launch of its Membership Program the stock up nearly 13 over the past week after the company also said it was teaming up with microsoft to buy the u. S. Operations of chinese social media platform tiktok. Those gains for walmart stills pales in comparison of amazon which is up 90 this year. Which company is a better bet . A lot of debate. What do you make of the ceo trying to push into tech whether its this ecommerce play or potential acquisition of tiktok i like what they are doing to expand what they have been known for for all of these years the idea of them being this competitor to amazon is a little stretched. The premare reason is amazon doesnt sort its own products from its own manufacturing just its own product line. They source it from all over place. Entrepreneurs can send things to their warehouses you can literally get anything on amazon. Com. Thats not the case yet with walmart. We continue to favor amazon. Walmart is pretty attractive trading 25 times forward and. 72 priced to sales and relatively yell thi Balance Sheet i think you should own both. I think you get a pretty good bang for the buck. Todd what do you think yeah, its been impressive. As youve said they have been busy with announcement tomorrow of microsoft on tiktok the chart is performing well we do own both there has been a significant unperformance of walmart compared to amazon looking at walmart plus its more of a grocery play decided to ship food from existing locations. I think its winnable in the short term longer term it could be tough running for them amazon is new to this. They just opened their first door inhills they are launching their food effort they have a lot of advantages in the long run with alexa, Voice Technology for ordering and the return of physical merchandise from Main Business in the fresh location they are both doing well yeah, dont call walmart out. Todd and quinn, thank you. For more trading nation head to our website or follow us on twitter. Back to you. Thank you. Still ahead, its time for our weekly special check in on the state of the economy and Restaurant Business with landrys chairman why he thinks business could take another hit this fall well be right back. Give you my world how can i, when you wont take it from me you can go your own way go your own way your wireless. Your rules. Only with xfinity mobile. Welcome backseat, everybody. Im sue herrera. Facebook taking down a Russian Network of face accounts seeking to influence left leaning voters in tus and he u. S. And britain. They hired unwittingly journalist to write the story on its behalf kenneth walker, the boyfriend of Breonna Taylor has filed a lawsuit. He was shot five times by police in which taylor was shot to death. Supporting School Reopenings will be one of the Top Priorities in distributing rapid covid 19 tests a top official says the vast majority of those test will be targeted at school and other critical institutions. President trump physician denying report has the president had experienced a stroke or a series of strokes. The doctor says the president remains healthy. You are up to date thats our news update this hour back to you. Thank you. Looks like americans are saving more and spending less thats what we found in a new cnbc and acorns invest in you survey when we settle to learn how the pandemic is shopliifting our relationship with money. 46 of the 5400 people we polled describe themselves as more of a saver. Thats roughly the same across age and racial groups. When we asked about monthly spending over the past year, a small number, only 13 said they monthly spending as gone up. Almost half say they have decreased their spending with the top reason being concern about the current economic situation. 53 of respon dents listed that worry a little more than a quartzer lost the source of income and 16 sited fear of another stock market downturn as the reason they decrease their spending of those who said their spending increase half sited the higher cost of essentials and 24 of that group say they are spending more because theyre bored we should point out that Nbc Universal and comcast are investors in acorn have you been bored lately not me not at all. A lot of people are having to tap their Emergency Savings. This was alarming be we found more than a third of people said they had to tap or completely wiped out their Emergency Savings. Here is what is alarming this is when enhanced unemployment was still in effect at this point, its been reduced and other states its been eliminated you have to wonder if congress doesnt pass another stimulus bill or if enhancement isnt added to unemployment will more people start to tap into Emergency Savings and how does that affect county sumnsumer sp. In cases people have valued to the extent companies do it of their 401 k s. That puts them behind in the game for their retirement savings. Not only does it kneecap what they have, it makes them have to play a much more aggressive game of catch up. Wefr seen that. People had to boar rrow money t stay afloat. Its precarious time moving forward without that benefit despite having his best week since the start of the pandemic, things could slow down after labor day. Kwou had you had a good week last week but it was not good in lake charles. I want to ask about how that property and community is recovering to the extent you know business has been better because its the week before labor day. Were pleased with that around the country. People out there dont realize that lake charles is devastated. People think this is as much damage as theyve ever seen a city go through. 80 of every single home is unliveable right now the casinos suffered a tremendous amount of damage. We have no electricity we have no water in the city we have no power in the city were using generators right now and really unhabitable rooms the Golden Nugget is full with first responders, state police, fire marsh ses companies that are there to fix the electrical and just because its more habitable than everywhere else. Were probably days and weeks before ever trying to open for a customer theres a 7 00 fcurfew its not getting the coverage. Its really huge disappointment in what this city needs. Just kickly we have al landrys Lake Charles Relief Fund which is a 501c. I dont like over head i just put in a million tladoll for employees and citizens of lake charles i can tell you ever cent with go to an individual if you give it to the landrys Lake Charles Relief Fund. It wont go to an organization with carpet overhead these people need help it will be months and years before lake charles is even back to normal and its so disappointing its not getting the coverage i agree with you on all of that the devastation im seen has been unlike any i have p seen. I dont mean to compare storms but theres been a lot of horrible ones in was a category 4, almost a 5. I think youre right it hasnt gotten the ongoing coverage that it might have had it occurred at a different time when there wasnt so many other things competing for peoples attention and their eyeballs i believe it on friday, my birthday that people can go out and actually dine in for a change what is that is that going to have any affect on your properties in new jersey absolutely. I have 19 restaurants in new jersey plus the casino in atlantic city. Were ecstatic to get 25 occupancy. You would have thought we found the end of the rainbow its exciting. Were getting philadelphia were getting san diego. We got miami back. All of these are only like 25 what we dont understand is the governor came out yesterday and today and said theres a less than 1 positive rate in the statd state of new york. The governor will not override the mayor in letting us open up at 25 the mayor said last week, he basically said that restaurants are only for wealthy people and why should we open the restaurants. All of a sudden you had guests the next day after we all talked about this theres so many mom and Pop Restaurants out there. E everybody from every single economic demographic area eats at some time of restaurant youll have mayor to make a Statement Like that and he always talked about the coalition between new jersey and pennsylvania and new york and yet the other part of the coalition is opening up now, 25 and now im just not upset with de blasio, the mayor, i mean Governor Cuomo that will not override that yall should impeach out of office if theres way to do it its ridiculous. Are you concerned as the Seasons Change were starting the feel that fall chill in the air . Are you concerned if people will have an incentury tifr secentiv and want to out door dine . Were concerned most of the high end restaurants in new york and the big volume restaurants, not necessarily high end but my bills burgers that sells everybody thats not a high end restaurant it doesnt have an outside patio. You cant in Rockerfeller Center have out door patios its closed. It was restaurant that served hundreds of guests a day whats said about this and im going to shoot you straight, tilman isnt going to driver a nicer car or live in a better house because the restaurants in new york open. My employees are sad that they cannot go back to work they are losing their minds. You got to remember, just a couple of statistics, theres 70 billion dollars less in the American Economy in the month of august since the stimulus stopped. They doebts have tnt have spenr anymore. That do the test on tsa on wednesday. Only 25 of your business travelers, all travelers its only 25 flying on an airplane today. Thats why youre airlines are talking about laying everybody off this fall. The city of new york has got to let us open our restaurants so people will even try to go there for business e everybody talks about texas. Its pandemic. Were normal in texas. You call a hospital in houston, texas rr anywhere in texas, our hospitals are operating at extreme normality right now. Were in a normal city but the new york people wont even let us come to new york right now without going into quarantine. Theres no highlight of people getting sick in texas right now. We invited the mayor to come on and that invitation is Still Standing we would love the hear from you. We would love to hear you on the same screen with tillman, by the way. One of his spokes people was characterized by two restauranteurs as not s substanti substantive. Lets get to something really important, which my son cares about. Thats the rockets what does the team have to do to win a game 7 sdpr the three we lost, we forgot where the basket is the last three minutes of the game. Its going to be great 7th game. You have lots of super stars and did i want to do this . No im having a miserable 48 hours between lake charles and this. You know, ill tell you this, id rather lake charles than the people come back and be better than the Houston Rockets ill sacrifice a loss if i know the world can be a better place. It would be great to win tomorrow and taking the lakers it will be a great series with Anthony Davis and lebron versus russell and james harden the world would love to see it maybe well win just for tv. The fourth larger market and the second largest market. Thanks so much. Continued good luck to you and to the people of lake charles who youre trying to help so clearly. We appreciate it coming up, a stock benefitting from the work from home halo plus two stocks you may have thought were dead at one point but they are both getting new investment at coming up on power lunch. Docusign hitting an all time high the stock is up 18. 5 . Eastman kodak disclosing a 5 stake in the company the stock has been volatile following its deal with the government and the sub kwents delay in the deal. The stock is up 25 . Lets end with game stop the cofounder of chewy increasing his stake the stock is up 80 in the past month. Up about 11. 5 right now still down over the longer term. Tyler, back to you its step 1st and that met and the rent is due. Is there a wave ov evictions coming there are so many ways to go public and so Many Companies taking advantage what the rush to go public means for the market well be right back. Today as you no he is the first of the month rent is due. It also means we may be about to see a lot of evictions diana olick looking at the potential for that hi, di hi, tyler today marks the end of various state eviction protections as did yesterday. In addition, the 30 days notice requirement from the end of the federal Eviction Moratorium is now up 30 states no longer have any eviction protections for renters. New york and california do still have protections for renters and florida just extended its protections. The federal Eviction Moratorium expired at the end of july but even that only covered at most 45 of the nearly 44 million renter households in the u. S. That is according to the atlanta fed. So eviction filings are now coming in and some property types are seeing more than others in large multifamily buildings, just over 92 of tenants paid full or partial rent by august 27th just about a 2 decrease from a year ago in comparison with 93. 3 that had paid by the end of july. There are more than 11 Million Units by the multifamily counsel. The paying is in the smaller buildings where typical tenants have a Median Income of just 35,500, the lowest among the represental units including Single Family units. So now cities like new orleans, philadelphia are just some bracing for a big wave of evictions. Back to you. All right thank you very much, diana it used to be that if a company wanted to go public, hit to do an ipo and then direct listings became popular, now it a ems as if if everyone is doing spac well explain next on power lunch. [ thunder rumbles ] [ engine rumbling ] [ beeping ] [ engine revs ] uh, you know theres a 30minute limit, right . Tell that to the rain. [ beeping ] for those who were born to ride, theres progressive. Woi felt completely helpless. Hed online. My entire career and business were in jeopardy. I called reputation defender. Vo take control of your online reputation. Get your free reputation report card at reputationdefender. Com. Find out your online reputation today and let the experts help you repair it. Woman they were able to restore my good name. Vo visit reputationdefender. Com or call 18778668555. A lot goes through your mind. How long will this last . Am i prepared for this . Are we prepared for this . With fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations, with access to taxsmart Investment Strategies designed to help you keep more of what youve earned so youll know youre doing what you can for your family and your future. Thats the clarity you get with fidelity wealth management. Welcome back the rush to go pub hick lic is dizzying the blank check Acquisition Companies are raising huge amounts of capital of the 100 or so Public Offering this is year, 64 are spacs with u. S. Funding at 30 billion, already more than double last years total with more now on the rush to go public is head of research at Manhattan Venture Partners thank you for being with us. So why the rush . Why the popularity this year combination of events this is great for private markets. We need more companies to come public tha thats great but at a more granular level, i think most of the companies were ready, were more than 8 years old. Theyre ready. They push out the plan to this year it so happens that everything is coming together. And thats for a good reason there is a theme running to all the companies. The Software Companies exposed to cloud computing, data analytics, security, all these are themes playing out that investors are appreciating and these companies figured thought is the right window to get out and they will last yobd all tbel this election and there are stories that will continue so a lot of the names this year have been the cloud companies. It has been said that this spac process is a lot more of an efficiency process for ipos but also not cheap who might this benefit and who would this not be right for . They are thats another good innovation. It is like going public. Its not for everyone. Its usually for companies that need to develop more they need some hand holding. They have a sponsor to guide them along maybe the revenues are not there yet. The product is not there yet but they have the potential. They need someone to spet on that so the sponsors know the companies well so they can stay with them and groom them thats where the big advantage s but there is a cost up front you have to pay the founders fee and all the other stuff. Overall, it turns out that different analysis that goes on maybe slightly more expensive in the long run but it has its own advantages. Not everyone can do a spac not everyone would want to do that ipos are in the end, they are much more better and theyre very popular yes, right now they come together but overall, ipos in general, traditional ipos are much more popular. Another word for the spacs is a blank check company. So my question is when i put my money into a spac, do i no he what im investing in . Or do i just know who im investing with and they will later determine what is going to actually be owned by the spac . Or are there two different kinds where you know the company is you no know what youre buying the other you turn over to put money to work . Yeah. I think there is a efficient process there. You get you have a say in the whole process. You get to vote on that. The different setups for spacs overall, the surprises are few but in the beginning, you give your money with the hope you have the mission and the vision and all that stuff but when they invest, they get approvals from the investors so you have a rough idea thats the good advantage of spacs. There is not much uncertainty. With ipos, you dont know what the opening price is going to be here, everything is pretty transparent. You know whats going to happen. So in that sense, they have better transparency. And you know what is coming down the pike really quickly, telling us about the companies you invested in that are eyeing ipos this year and what the conversations are like right now yeah. We have air bnb. We invested there. We did not invest in doordash. Some of our companies have come public already as asana is there those are the main ones. But down the road, a lot of companies that were investors in, i follow it closely which is data bricks and strife and a few other companies that i dont remember off hand. But those are very Good Companies that are coming down the pike there is a big pipeline behind them that you will see more focus on Enterprise Software than other things. But the biggest consumer facing Internet Companies is airbnb that will come to market soon. All right well have to leave it there thank you. Thank you thanks for having me. Of course also a happy early birthday. Yes 21 never look sod good, tyler. Well get the jobs report that will be my birthday present on friday. Record levels for the s p 500 and nasdaq today thanks for watching power lunch. Closing bell will serve up the meat and potatoes with gravy right now. As we always do, tyler, thank you. Welcome everyone to closing bell. Im sara eisen with wilfred frost. Stocks higher to start september. Nasdaq up another 1 now up 33 for the year. Lets look at what is driving the action big rebound in the Manufacturing Sector industrials, materials, and transports to day. Zooms huge quarter. The stock is up 40 . That i