Transcripts For CNBC Power Lunch 20170919 : vimarsana.com

Youll understand why were playing that music in just a minute welcome to power lunch. Im michelle carusocabrera. Stocks carving out small gains the dow hitting yet another record high. Lets take a look at the benchmark tenyear note. The yields there hitting their highest levels since mid august. Right now the 10year yield at 2. 24 . Some of the stock movers, sprint and tmobile, both soaring our david faber reporting the two were in active talks about a merger again going the other way, however, best buy shares are tanking about 9 . The retailers outlook falling short of expectations. Were going to head live to the investor meeting in just minutes from now heres some other news happening at this hour cnbc confirming reports that the senate gop is looking at a tax cut that would total between 1 and 2 trillion. And are cereal and sausage the investing breakfast of champions . The company post hopes so because its buying food maker bob evans for 1. 5 billion and its prime time for kohls investors. That stock is up after the retailer says it will now offer free returns for amazon customers. More on that straight ahead. We begin, though, with President Trumps first speech at the United Nations General Assembly. As brian said it was a fiery speech where he repeated his policy of America First, also attacked north korea, iran, and venezuela, and vowed to keep americans safe by fighting terrorism. As president of the United States i will always put America First. Just like you as the leaders of your countries will always and should always put your countries first. If it is forced to defend itself or its allies, we will have no choice but to totally destroy north korea. Rocket man is on a Suicide Mission for himself and for his regime the iranian government masks a corrupt dictatorship behind the false guise of a democracy the iran deal was one of the worst and most onesided transactions the United States has ever entered into. The United States and our allies are working together throughout the middle east to crush the loser terrorists the problem in venezuela is not that socialism has been poorly implemented but that socialism has been faithfully implemented. Joining us now, fred kemp, president and ceo of the Atlantic Council fred, you say this was a very good speech for the president. Why . First of all, those were great sound bites. I think you really picked ones that really illustrated trump at his most trumpian. But if you look at the broad speech, it had enough in it for everybody. So for his base those are the excerpts you picked. He also was tough on trade there was stony silence there. Interestingly, when he talked about America First and you also think about your countries first and you should, there was applause in the room so there was some applause lines there. So i think what he came away with was enough in the speech to satisfy his base, which doesnt like the United Nations, didnt want him to go there at all, but enough there to show respect to the United Nations a United Nations official i talked to was frankly quite relieved because he really could have had some sharp lines for the United Nations itself. But he was quite diplomatic in that respect yeah, there was a whisper where you almost thought he was going to suggest that they had helped enable north korea, for example. He could have been much tougher on the institution and youre right, fred we did pick the most trumpian, the most were journalists, right . Were going to pick the most bellicose sound bites. Toward the end, though, i thought if ever theres going to be a trump doctrine as the Foreign Policy wonks like you guys like to discuss, when he talked about the revival of nations, which seemed to be this statement against institutions like the European Union which seem to suppress individual countries, their individuality, their particular sovereignty for this kind of bigger bureaucratic existence, that toward the end i thought really spoke to the whole speech any thoughts on that first of all, i accept the fact that you called me a wonk ill accept that so if youre looking at this in a wonky kind of way, its a fascinating speech because it is his most important Foreign Policy speech and theres a lot in there suggesting what his strategy is now. What is the trump strategy hes spending four days in new york a senior u. N. Official says thats terribly unusual. Hes here with Vice President pence the whole time theyve been keeping other people quiet on Foreign Policy the last couple of days. So they wanted people to focus on it. And the strategy is something he called principled realism. He essentially is making America First a global strategy, meaning were going to be sovereign, we want all of you to be sovereign and together thinking about our own interests will actually figure out what we can do together and what we agree upon. Its maybe less utopian than the United Nations but its also a little bit utopian to think that everybody thinking of themselves first is going to create a Global Community those at the u. N. Who were upset about the speech didnt like the fact that it had nothing about climate in it. President macron followed, and he doubled down on climate he said he wouldnt do away with this multilateral deal on iran so theres also there is a little bit of tension even now with the french president who followed him you know, on climate change, so yes, macron followed him. I sat through the first three speeches i was down there this morning. Every single one of the speeches leading up to President Trump talked about climate change. Talked in very, very soft tones that i associate with the u. N. This must have been a culture clash to see him speak this way, no for all those 193 members sitting there watching. There is no doubt it was a culture clash. But theres also no doubt that a lot of people expected far worse and were happy with it i also think hes laid down a couple of markers where lets watch how he follows up. On north korea he did say, and you showed the sound bite, that he would obliterate the country if indeed our allies or the United States were threatened. But then he turned more quickly and he said, but this is for you to fix, this is your issue youve taken on because this is the way we should fix it on iran he did foreshadow a potential walking away from the nuclear deal saying its an embarrassing deal, it doesnt work yet, macron of course saying pretty much the opposite. Noww what does he do the next time they go for review . We know from the meetings on this issue that hes unhappy with the options hes been given and he wants an option that takes a more serious look at this deal. So i think theres a lot there to digest. I think we are seeing a strategy rolled out and were also seeing some of the things hes highlighted as his priorities Going Forward okay. Fred, thanks for weighing in fred kempe with the Atlantic Council. Lets get the latest on hurricane maria. The storm making landfall overnight in the caribbean island of dominica as a category 5. Its now on track for a direct hit of puerto rico lets get the latest from nbcs Tammy Leitner live in san juan reporter hey there weve really seen the winds kick up in the last few hours the ocean is churning. Things are getting a little bit more tense here. Hurricane marias he obviously getting closer what you need to keep in mind is a lot of people on the island are still recovering from Hurricane Irma some people have no power, they have no water, and now theyre having to prep for yet another hurricane. The shelves in the Grocery Stores, they have been picked slim home depot, theyre out of generators, theyre out of batteries, and tonight the airport is closing so if you were here on this island, you were actually stuck here and i am here with a couple of guys, a whole family, actually, that is stuck here and brandon, this is your first hurricane. How are you feeling right now . Im feeling trying to hold my faith my familys here were all keeping each other calm, cool, collected, trying to act as normal as possible. Listen to the rules and the hotel has been great they have a shelter in place for us theyve guaranteed our safe not guaranteed but tried to make us as comfortable as possible. And there are about 500 shelters here on the island. I want to point out that are available for people to go to. And roberto, are you concerned quite honestly, im a little worried, yeah. This is a little bit scary reporter i can imagine that for people that have never been through a hurricane it probably is extremely frightening thank you guys so much, and i hope that youre saying. So guys, a lot of people uncertain as to what is going to happen in the next 24 hours. Back to you. Tammy leitner, be safe. Good luck. Well chat with you again. Coming up, why houston homeowners may be waiting a very long time to get their homes rebuilt after Hurricane Harvey we have an exclusive on that ahead. But first, Hedge Fund Titan ray daalio says if the fed goes too far too fast on Interest Rate hikes youd better watch out well ask our panel of market experts if they agree and if so ou ido you protect your mone y y arndt . Stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. People dont invest in stocks and bonds. They dont invest in alternatives or municipal strategies. What people really invest in is what they hope to get out of life. But helping them get there means you cant approach investing from just one point of view. Because its only when you collaborate and crosspollinate many points of view that Something Wonderful can happen. Those people might just get what they want out of life. Or they could get even more. Track your pack. What they want out of life. Set a curfew, or two. Make dinnertime device free. [ music stops ] [ music plays again ] a smarter way to wifi is awesome. Introducing xfinity xfi. Amazing speed, coverage and control. Change the way you wifi. Xfinity. The future of awesome. I think that the letting the Balance Sheet run out at the rates theyre saying is too high i dont think theyll probably progress at that rate, at the rates that theyre telling us. On the margin we know where credit is. And then what it means essentially, 2 1 2 of gdp is going to be cut essentially by allowing the Balance Sheets to run off, and i think that there will probably be an increase in the budget deficit by Something Like 2 1 2 of gdp so the supplydemand of bonds, if you look at that, would be Something Like 5 of gdp if you worsening if they went through that plan. If they went through the plan. So i dont think theyre going to make the plan i think it will be very similar to the tightening plan that was Bridgewater Associates founder ray daleio on squawk box this morning. The billionaire Hedge Fund Titan added he doesnt see anything that would cause a downturn right now except action but bad action by the fed. Lets see if your next guests agree with that. Chad morganlander of crossing advisers and ryan kenny of Hennessy Funds join us do you agree with that is the Federal Reserve because the market didnt react to the president today it hasnt reacted to Nuclear Missile or missiles in north korea. Is the fed the biggest risk to the equity market right now . Well, it is one of the risks. We dont think that theyre going to derail the credit markets or Financial Markets because theyre going to move in such a slow methodical deliberate manner. We think theyre moving from qe, the new phrase where now is going to be qt, quantitative tightening theyre going to reduce their Balance Sheet, and its going to be in a gradual manner now, with that said we do believe that as they start to raise Interest Rates and it gets a little more difficult in 2018, in the latter half of 2018 its going to have a little more of a meaningful impact on the Financial Markets. But for the time being in the short run its not going to have a big impact why are you so confident that the Federal Reserve knows the meaning or the correct gradual speed of gradual is not a definitive term. Let me be very clear. Im not 100 confident but if they start to reduce the Balance Sheet by, say, a couple of hundred billion dollars over the course of the next 6 to 12 months i dont think its going to create a credit dislocation within the Global Financial system now, will it start to slow credit growth on a global basis . Well have to wait and see but the biggest generator of credit growth is not the Federal Reserve. Its actually china. And thats really going to be the main thematic in 2018. So its the fed. Its going to be china and their policy on how theyre going to ramp up their credit growth. Ryan, do you see any risks to the stock here i think this is an incredible market right now we continue to go up day in and day out no matter what the fed is saying, no matter what sort of issues were hearing from north korea. Weve had natural disasters, two of them so far so and its doing so in a calm way but thats where a little bit of the worry is can you for me. We havent had any correction in 19 months now. And before that for about six years about two times per year wed have a little correction about 5 or 10 . That would give the market some pause, let people consolidate. So i think at this point were probably due for Something Like that so sorry, go ahead i was going to say do you lighten up do you hold it sounds like reversion to the mean. You can point to higher than longterm average p es but i think you can go a little to cash, look for Fund Managers that protect on the down side a little bit more, that are more valueoriented and then also you can look at certain sectors such as Consumer Staples or even utilities. You know, chad, we do forget that last january was the worst start to any year in the stock market history i wonder if that was to your point, ryan, the correction everybodys waiting for. Maybe it already happened in a big way and then it bounced back that said, chad, when you go out, do people say to you or do clients call you and say i dont understand why when we hear the kind of rhetoric were hearing and everything in north korea and all the stuff were talking about why the dow just goes up every single day thats absolutely the general thematic for the last several years. Why does it continue to gradually go higher . One of the critical reasons is because low Interest Rates not only here in the United States but also across the globe on the long end of the curve has actually made and forced investors into more speculative asset classes. Investors, the way that theyre looking at it now, is the earnings yield compared to the riskfree rate and theyre asking themselves am i getting a good fair return now, i would caution investors not to take that trade next year in 2018. When you look at market cap to total gdp its really quite high from a historical perspective. You can look it from an enterprise to value to sales baesis or p e multiple basis so were advising investors to scale back their risk, go from an overweight position in equities to more of a neutral position in equities ryan and chad, good discussion, guys im sure its not over well see you again soon thanks for having us. Coming up, why kohls move to accept amazon returns is good news for walmart we explain, next two firms think the shoe may drop at both nike and under armour first Susquehanna Research slicing its rating on nike to neutral. The annual says there are too many basketball products laying around and that will pressure sales and margins. Thats not all wells fargo recommends dumping under armour entirely, cut its rating to underperform, basically a sell, primarily due to distribution issues and a current lull in Product Innovation under armour stock, by the way, down more than 2 right now, michelle also down, best buy from sneakers to electronics. Best buy shares are tanking. The retailers ceo laying out his vision for growth of the companys First Investor day in five years stock is off nearly 7 Courtney Reagan spoke with the ceo. Shes live at best buy headquarters in richfield, minnesota with more. Courtney hi, michelle. So the shares are down on best buys 2021 President Trump<\/a>s first speech at the United Nations<\/a> General Assembly<\/a>. As brian said it was a fiery speech where he repeated his policy of America First<\/a>, also attacked north korea, iran, and venezuela, and vowed to keep americans safe by fighting terrorism. As president of the United States<\/a> i will always put America First<\/a>. Just like you as the leaders of your countries will always and should always put your countries first. If it is forced to defend itself or its allies, we will have no choice but to totally destroy north korea. Rocket man is on a Suicide Mission<\/a> for himself and for his regime the iranian government masks a corrupt dictatorship behind the false guise of a democracy the iran deal was one of the worst and most onesided transactions the United States<\/a> has ever entered into. The United States<\/a> and our allies are working together throughout the middle east to crush the loser terrorists the problem in venezuela is not that socialism has been poorly implemented but that socialism has been faithfully implemented. Joining us now, fred kemp, president and ceo of the Atlantic Council<\/a> fred, you say this was a very good speech for the president. Why . First of all, those were great sound bites. I think you really picked ones that really illustrated trump at his most trumpian. But if you look at the broad speech, it had enough in it for everybody. So for his base those are the excerpts you picked. He also was tough on trade there was stony silence there. Interestingly, when he talked about America First<\/a> and you also think about your countries first and you should, there was applause in the room so there was some applause lines there. So i think what he came away with was enough in the speech to satisfy his base, which doesnt like the United Nations<\/a>, didnt want him to go there at all, but enough there to show respect to the United Nations<\/a> a United Nations<\/a> official i talked to was frankly quite relieved because he really could have had some sharp lines for the United Nations<\/a> itself. But he was quite diplomatic in that respect yeah, there was a whisper where you almost thought he was going to suggest that they had helped enable north korea, for example. He could have been much tougher on the institution and youre right, fred we did pick the most trumpian, the most were journalists, right . Were going to pick the most bellicose sound bites. Toward the end, though, i thought if ever theres going to be a trump doctrine as the Foreign Policy<\/a> wonks like you guys like to discuss, when he talked about the revival of nations, which seemed to be this statement against institutions like the European Union<\/a> which seem to suppress individual countries, their individuality, their particular sovereignty for this kind of bigger bureaucratic existence, that toward the end i thought really spoke to the whole speech any thoughts on that first of all, i accept the fact that you called me a wonk ill accept that so if youre looking at this in a wonky kind of way, its a fascinating speech because it is his most important Foreign Policy<\/a> speech and theres a lot in there suggesting what his strategy is now. What is the trump strategy hes spending four days in new york a senior u. N. Official says thats terribly unusual. Hes here with Vice President<\/a> pence the whole time theyve been keeping other people quiet on Foreign Policy<\/a> the last couple of days. So they wanted people to focus on it. And the strategy is something he called principled realism. He essentially is making America First<\/a> a global strategy, meaning were going to be sovereign, we want all of you to be sovereign and together thinking about our own interests will actually figure out what we can do together and what we agree upon. Its maybe less utopian than the United Nations<\/a> but its also a little bit utopian to think that everybody thinking of themselves first is going to create a Global Community<\/a> those at the u. N. Who were upset about the speech didnt like the fact that it had nothing about climate in it. President macron followed, and he doubled down on climate he said he wouldnt do away with this multilateral deal on iran so theres also there is a little bit of tension even now with the french president who followed him you know, on climate change, so yes, macron followed him. I sat through the first three speeches i was down there this morning. Every single one of the speeches leading up to President Trump<\/a> talked about climate change. Talked in very, very soft tones that i associate with the u. N. This must have been a culture clash to see him speak this way, no for all those 193 members sitting there watching. There is no doubt it was a culture clash. But theres also no doubt that a lot of people expected far worse and were happy with it i also think hes laid down a couple of markers where lets watch how he follows up. On north korea he did say, and you showed the sound bite, that he would obliterate the country if indeed our allies or the United States<\/a> were threatened. But then he turned more quickly and he said, but this is for you to fix, this is your issue youve taken on because this is the way we should fix it on iran he did foreshadow a potential walking away from the nuclear deal saying its an embarrassing deal, it doesnt work yet, macron of course saying pretty much the opposite. Noww what does he do the next time they go for review . We know from the meetings on this issue that hes unhappy with the options hes been given and he wants an option that takes a more serious look at this deal. So i think theres a lot there to digest. I think we are seeing a strategy rolled out and were also seeing some of the things hes highlighted as his priorities Going Forward<\/a> okay. Fred, thanks for weighing in fred kempe with the Atlantic Council<\/a>. Lets get the latest on hurricane maria. The storm making landfall overnight in the caribbean island of dominica as a category 5. Its now on track for a direct hit of puerto rico lets get the latest from nbcs Tammy Leitner<\/a> live in san juan reporter hey there weve really seen the winds kick up in the last few hours the ocean is churning. Things are getting a little bit more tense here. Hurricane marias he obviously getting closer what you need to keep in mind is a lot of people on the island are still recovering from Hurricane Irma<\/a> some people have no power, they have no water, and now theyre having to prep for yet another hurricane. The shelves in the Grocery Store<\/a>s, they have been picked slim home depot, theyre out of generators, theyre out of batteries, and tonight the airport is closing so if you were here on this island, you were actually stuck here and i am here with a couple of guys, a whole family, actually, that is stuck here and brandon, this is your first hurricane. How are you feeling right now . Im feeling trying to hold my faith my familys here were all keeping each other calm, cool, collected, trying to act as normal as possible. Listen to the rules and the hotel has been great they have a shelter in place for us theyve guaranteed our safe not guaranteed but tried to make us as comfortable as possible. And there are about 500 shelters here on the island. I want to point out that are available for people to go to. And roberto, are you concerned quite honestly, im a little worried, yeah. This is a little bit scary reporter i can imagine that for people that have never been through a hurricane it probably is extremely frightening thank you guys so much, and i hope that youre saying. So guys, a lot of people uncertain as to what is going to happen in the next 24 hours. Back to you. Tammy leitner, be safe. Good luck. Well chat with you again. Coming up, why houston homeowners may be waiting a very long time to get their homes rebuilt after Hurricane Harvey<\/a> we have an exclusive on that ahead. But first, Hedge Fund Titan<\/a> ray daalio says if the fed goes too far too fast on Interest Rate<\/a> hikes youd better watch out well ask our panel of market experts if they agree and if so ou ido you protect your mone y y arndt . Stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders<\/a> connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. People dont invest in stocks and bonds. They dont invest in alternatives or municipal strategies. What people really invest in is what they hope to get out of life. But helping them get there means you cant approach investing from just one point of view. Because its only when you collaborate and crosspollinate many points of view that Something Wonderful<\/a> can happen. Those people might just get what they want out of life. Or they could get even more. Track your pack. What they want out of life. Set a curfew, or two. Make dinnertime device free. [ music stops ] [ music plays again ] a smarter way to wifi is awesome. Introducing xfinity xfi. Amazing speed, coverage and control. Change the way you wifi. Xfinity. The future of awesome. I think that the letting the Balance Sheet<\/a> run out at the rates theyre saying is too high i dont think theyll probably progress at that rate, at the rates that theyre telling us. On the margin we know where credit is. And then what it means essentially, 2 1 2 of gdp is going to be cut essentially by allowing the Balance Sheet<\/a>s to run off, and i think that there will probably be an increase in the budget deficit by Something Like<\/a> 2 1 2 of gdp so the supplydemand of bonds, if you look at that, would be Something Like<\/a> 5 of gdp if you worsening if they went through that plan. If they went through the plan. So i dont think theyre going to make the plan i think it will be very similar to the tightening plan that was Bridgewater Associates<\/a> founder ray daleio on squawk box this morning. The billionaire Hedge Fund Titan<\/a> added he doesnt see anything that would cause a downturn right now except action but bad action by the fed. Lets see if your next guests agree with that. Chad morganlander of crossing advisers and ryan kenny of Hennessy Funds<\/a> join us do you agree with that is the Federal Reserve<\/a> because the market didnt react to the president today it hasnt reacted to Nuclear Missile<\/a> or missiles in north korea. Is the fed the biggest risk to the equity market right now . Well, it is one of the risks. We dont think that theyre going to derail the credit markets or Financial Markets<\/a> because theyre going to move in such a slow methodical deliberate manner. We think theyre moving from qe, the new phrase where now is going to be qt, quantitative tightening theyre going to reduce their Balance Sheet<\/a>, and its going to be in a gradual manner now, with that said we do believe that as they start to raise Interest Rate<\/a>s and it gets a little more difficult in 2018, in the latter half of 2018 its going to have a little more of a meaningful impact on the Financial Markets<\/a>. But for the time being in the short run its not going to have a big impact why are you so confident that the Federal Reserve<\/a> knows the meaning or the correct gradual speed of gradual is not a definitive term. Let me be very clear. Im not 100 confident but if they start to reduce the Balance Sheet<\/a> by, say, a couple of hundred billion dollars over the course of the next 6 to 12 months i dont think its going to create a credit dislocation within the Global Financial<\/a> system now, will it start to slow credit growth on a global basis . Well have to wait and see but the biggest generator of credit growth is not the Federal Reserve<\/a>. Its actually china. And thats really going to be the main thematic in 2018. So its the fed. Its going to be china and their policy on how theyre going to ramp up their credit growth. Ryan, do you see any risks to the stock here i think this is an incredible market right now we continue to go up day in and day out no matter what the fed is saying, no matter what sort of issues were hearing from north korea. Weve had natural disasters, two of them so far so and its doing so in a calm way but thats where a little bit of the worry is can you for me. We havent had any correction in 19 months now. And before that for about six years about two times per year wed have a little correction about 5 or 10 . That would give the market some pause, let people consolidate. So i think at this point were probably due for Something Like<\/a> that so sorry, go ahead i was going to say do you lighten up do you hold it sounds like reversion to the mean. You can point to higher than longterm average p es but i think you can go a little to cash, look for Fund Managers<\/a> that protect on the down side a little bit more, that are more valueoriented and then also you can look at certain sectors such as Consumer Staples<\/a> or even utilities. You know, chad, we do forget that last january was the worst start to any year in the stock market history i wonder if that was to your point, ryan, the correction everybodys waiting for. Maybe it already happened in a big way and then it bounced back that said, chad, when you go out, do people say to you or do clients call you and say i dont understand why when we hear the kind of rhetoric were hearing and everything in north korea and all the stuff were talking about why the dow just goes up every single day thats absolutely the general thematic for the last several years. Why does it continue to gradually go higher . One of the critical reasons is because low Interest Rate<\/a>s not only here in the United States<\/a> but also across the globe on the long end of the curve has actually made and forced investors into more speculative asset classes. Investors, the way that theyre looking at it now, is the earnings yield compared to the riskfree rate and theyre asking themselves am i getting a good fair return now, i would caution investors not to take that trade next year in 2018. When you look at market cap to total gdp its really quite high from a historical perspective. You can look it from an enterprise to value to sales baesis or p e multiple basis so were advising investors to scale back their risk, go from an overweight position in equities to more of a neutral position in equities ryan and chad, good discussion, guys im sure its not over well see you again soon thanks for having us. Coming up, why kohls move to accept amazon returns is good news for walmart we explain, next two firms think the shoe may drop at both nike and under armour first Susquehanna Research<\/a> slicing its rating on nike to neutral. The annual says there are too many basketball products laying around and that will pressure sales and margins. Thats not all wells fargo recommends dumping under armour entirely, cut its rating to underperform, basically a sell, primarily due to distribution issues and a current lull in Product Innovation<\/a> under armour stock, by the way, down more than 2 right now, michelle also down, best buy from sneakers to electronics. Best buy shares are tanking. The retailers ceo laying out his vision for growth of the companys First Investor<\/a> day in five years stock is off nearly 7 Courtney Reagan<\/a> spoke with the ceo. Shes live at best buy headquarters in richfield, minnesota with more. Courtney hi, michelle. So the shares are down on best buys 2021 Earnings Guidance<\/a> analysts had really expected more from a retailer thats come a very long way. Remember just five years ago some were questioning whether best buy would even survive. Now ceo hubert jolie is focused on growth, and a lot of that strategy has to do with the connected home youre still going to have the geek squad, the magnolia support, and have the inhome advisers and then also total tech support total tech support, this is so exciting. Of course weve been in services for a long time with the geek squad. Typically, the Geek Squad Services<\/a> were attached to a single product so you would buy that and it was repairoriented, lets say, for your computer. With everything being connected, what customers have told us they want is support across their entire home. The service is attached to a household. It covers every Technology Product<\/a> you have in your home, whether or not you bought it at best buy, and were going to help you so as an example, if netflix is not working tonight, is it because of netflix is it the pipe getting into the home is it the wifi . Is it the tv is it the streaming device honey, please help me. And were honey. Shares are down today for best buy, but in fairness over the last five years theyre up more than 220 under ceo hubert joely. Its proven that it can exist in an amazon world. But the battle is far from over. Remember, amazon also has just started its fleet of smart home experts. So the battle is still ongoing its far from won by any one player back to you guys so courtney, he said on the call last night apparently until i match amazons prices the customers are ours to lose so hes really going to go head to head when it comes to market share. So the investor meeting actually hasnt yet started. Its going to start in about a half an hour i believe youre talking about in the New York Times<\/a> hubert joly had spoken to them in general about what had happened with his strategy. And he was saying that before he matched the prices, i mean, why wouldnt you go to amazon . His idea was match the prices. Yeah, its going to cost us a little bit but at least we have a chance now to win that sale. So thats all part of what hes done to sort of reinvent best buy and make sure its still relevant, both in store and online, and use the two together got it. Thank you, courtney. You got it. Sticking with retail, kohls announcing a new initiative with amazon starting in october, 82 kohls stores in chicago and los angeles will be offering free returns for amazon purchases including packaging and shipping amazon with this deal pushing deeper into the brick and mortar space. Does this move further validate walmart as a real competitor to amazon lets bring in edward ruma, managing director with key capital markets. Great to have you with us. You cover both amazon as well as walmart. What seems in terms of amazons strategy in the past couple months with the purchase of whole foods and now this tieup with kohls is theyre saying we do need a physical presence. Does that mean that walmart is truly a viable competitor because its got both going for it right now, online as well as bricks and mortar . Absolutely. And i think, you know, were seeing that this is really the new battleground clearly ecom is incredibly important but where the big bulk of spending still happens is in this offline environment so we think amazons purchase of whole foods, Amazon Opening<\/a> bookstores and now this kohls agreement really lends credence to the idea you need to have a great website but you also need to have a great physical presence in terms of the retail part of the business, what sort of multiple should that be . Should it be implied that amazons multiple is too high on the retail side or that the bricks and mortar guys out there the rest of the coverage universe should actually have a higher multiple . One of our theses right now is there are a you number of physical retailers, walmart included, that are make the investments in the stores, that are making investments in ecom, and we think those should carry premium multiples. There are plenty of retailers that have underinvested and those should and deserve to trade at a discount. Amazon is its own different beast, and clearly their investments theyre making portend to a growth curve thats frankly unmatched in the rest of retail skri know i you dont cover kohls, but can you see amazon buying a bricks and mortar chain along the lines of a kohls . Clearly amazon has been open to acquiring assets. Yeah, we dont cover kohls. So i wont opine on that but look, i think amazon also uniquely has the ability to create their own physical experiences. Youve seen it with a bookstore. Youve seen it with this amazon fresh pickup certainly theres an acquisition component of the strategy. But no doubt amazon is very capable of building would you be more bullish on amazon if it made some sort of overture to acquire a chain like kohls i know you dont cover kohls but you acquire amazon look, i think it would give them more of a head start here so clearly more physical retail we think is the way to go. Ed, thanks a lot for your time thank you ed yruma. Hurricanes and the economy with the nations Top Economists<\/a> are saying about the longterm Financial Impact<\/a> and as houstonians and southern texans work to rebuild after rv, eyacanher challenge. Finding workers. Well tell you that story coming up where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. [he has a new business teaching lessons. Rodney wanted to know how his business was doing. So he got quickbooks. It organizes all his accounts, so he can see his bottom line. Ahhh. Thats a profit. Know where you stand instantly. Visit quickbooksdotcom. Let your data live wherever it needs to, but see it all in one view. The ibm cloud. The cloud for enterprise. Yours. Hello, everyone. Im sue herera heres your cnbc news update for this hour. President trump threatening to annihilate north korea if that country fails to abandon its pursuit of Nuclear Weapons<\/a> he delivered the warning during his first address to the u. N. General assembly the United States<\/a> has great strength and patience. But if it is forced to defend itself for its allies we will have no choice but to totally destroy north korea. Rocket man is on a Suicide Mission<\/a> for himself and for his regime parts of long island, new york are gearing up for the effects of hurricane jose. The storm is expected to remain off the northeastern coast but forecasters are predicting its effects will impact the shoreline. Cybersecurity firm mcafee announcing its 11th annual list of the most dangerous celebrities to search for online topping the list is singer avril lavigne. Second is bruno mars mcafee says the searchers are most likely to land consumers on websites that carry viruses or malware. Thats the news update this hour michelle, ill send it back to you. I havent googled them in a long time. There you go. Youre safe. President arriving for a meeting with the u. N. Secretarygeneral right now. Live pictures. Meeting with antonio guterres, you see there. Made a couple of swipes at President Trump<\/a>, not directly but in his opening speech. Talked about climate change, not turning our backs on the paris climate accord, et cetera. So well see how this lunch goes and of course President Trump<\/a>s speech was quite fiery as well, guys absolutely. I mean right the General Assembly<\/a> probably has never heard words like that ever before. From a u. S. President when youre calling members of the Human Rights Commission<\/a> human rights violators right and some of the members are sitting there shifting there uncomfortably in their seats as they should, by the way right it wasnt incorrect, some of what he said, a lot of what he said lets take a check of the markets right now. Stocks are pretty steady in a tight range. The dow did hit another record high here before backing down by just a bit up by about. 2 percent the 10year note hitting the highest level since mid august telecom the highest performing sector on the s p 500. Thanks to david fabers reports that sprint and tmobile they are talking once again we are seeing those stocks rallying here. So while the recent hurricanes have caused a lot of devastation to the local economies where they hit, the nations Top Economists<\/a>, market strategists, money managers, theyre not worried about the National Economic<\/a> impact. Steve liesman is here with the results of the cnbc fed survey its amazing, michelle, how the pictures of devastation conflict with the numbers and how the effect on gdp has seemed really to be muted in fact, theres even a slight upside, if it can be believed. I want to show you the cnbc fed survey and the outlook for year over year change in gdp. Back in july, 2 1 4 was the outlook for this year. That came down just a little bit. But look what happened up a little more, 2. 45 to 2. 6 is the current we asked them specifically how much of this change we had 42 responses. How much of this change came from the hurricane take a look. Very slight negative for 17 and a bigger positive for 2018 as the effects of rebuilding kick in thats gdp accounting. It doesnt take account for the effects on peoples lives and the devastation to their homes and properties now, take a look at the outlook here for recession it is pretty much middling about a 1 dpsh call it 13 weve been lower, weve been quite a bit higher what are the big risks first of all, trade. Protectionist trade policy seen as the biggest risk. 32 . Geopolitical risk 17 . And tax and regulatory policies 12 . One other things i want to show you about this thing about who President Trump<\/a> might reappoint, and its gone up for the fed chair given whats happened with gary cohn. Whats happened with other things out there it had been 10 , and now its 38 according to our respondents. 75 said he wouldnt reappoint her. 53 say no if not janet yellen, guys, the person who is in the number one slot now, is former fed governor kevin worsh. Talking about the next couple of days, did you no rate hike. 100 68 say the fed will begin reducing the Balance Sheet<\/a> by october. And then that third rate hike, 76 say there will be one in december thats a little different, a little bit higher than some of the market base measures look for that third rate hike according to this group. And theyre not so good on the stock market isnt that a lot different i mean, isnt that a lot higher . From my understanding its a 50 right it was about 25 or 30 difference in the probability versus our survey measures the percent of people who say it will happen in a given month and thats 76 by december, whereas the odds in the fixed income markets, the fed futures market is like 45 you know, steve, i dont know if you saw this but guggenheims scott minor, who we all know very well, i think it was yesterday twor days ago said in an interview that if the fed goes too fast he sees a good chance of a recession in two years. Well hear from him about the fed soon is the r word being bandied about in the people you talk, to whispering in the hullways you know whats worse than the r word the d word. No. Oh. What word . I was going to talk about this tomorrow but ill do it now. 1937 thats worse thats a number ray dalio this morning was comparing now to 1937. 1937 is the year that i think ben bernanke told me once you put the great in Great Depression<\/a> what happened is we had a couple good years of growth in the postdepression era and then they tightened policy and they went right back to it. Thats the fear now for ray dalio speaking this morning on squawk box. He said we might have a 1937 redux if the fed moves too fast in terms of reducing its Balance Sheet<\/a> and raising rates. Im not schur about the r word but possibly if the fed moves too fast and the economy is not ready for this change in policy the fed will launch tomorrow but i think the feds going to go slow enough such that if it is making a mistake it will have an opportunity to pull back. All right, steve, thank you pleasure. Steve liesman the hurricanes may not be having a negative impact on the overall economy. Harvey has left houston in a bad spot, particularly when it comes to rebuilding the tens of thousands of homes that were destroyed. Diana olick is live in houston with that story. Hi, diana. Reporter hi. And you know, when you drive through downtown houston and the main thoroughfares, you almost wouldnt know there was a hurricane here and then you turn down the side streets and house after house after house is literally inside out. The insides torn out and put back onto the front lawn and many of the homeowners really have to do all this work themselves there was no one else to do it they have to dry everything out before they can even think of rebuilding jennifer and andy taylor, these homeowners, did all of this work in one weekend with a little help from their friends. We had about 25 friends and family that we called. Facebook texted phone calls. And we had an army of friends and family come out with some Church Volunteers<\/a> as well. To do all this. To do all this. You guys seem incredibly calm and zen about this weve had our moments to be sure a lot of those moments were really being touched by the outreach reporter they said food trucks came down these streets offering free food as they worked and supplies like clothes and toys came pouring in now, just for some perspective there were already about 27,000 new singlefamily Building Permits<\/a> for this year before harvey hit for houston and a severe shortage of workers to build those new homes now the shortage has more than doubled. The taylors consider themselves lucky because they were friends with a contractor, a contractor who has a very long waiting list theres not enough people to put them back together theres not enough workers theres not enough material. Theres not enough time. Its going to take everybody who calls to find a place to live for a year and hope we can get you done in a year the National Association<\/a> of Home Builders<\/a> has asked the Trump Administration<\/a> to issue some kind of temporary worker visa so they can bring more workers into texas from mexico and of course into florida as well Home Builders<\/a> here are just begging for help so far they have not heard anything back. Lots more of this online realtycheck. Cnbc. Com diana, presumably a lot of those homeowners are going to have to do things like rewire their houses and so on is there going to be a back log on the other side of it when its time to get their plans approved when it comes to permitting and so forth . I mean, you cant imagine the amount of work ahead we went inside this house, as you saw. They have some electrical that theyve kind of juryrigged up so they can get the fans in there. Weve been to other homes where theyve tried to get pipes working so they can clean it out. Its really fans its getting a contractor in there, its getting the permitting done. Some of these homes are going to be leveled some of them are going to be renovated. Some of the homeowners have decided to level the house and build new. But theyre saying it could take anywhere from two to six years to go through the backlog of these homes. Not to mention that houston actually had a housing shortage before all this started. What a long road ahead. Diana, thank you diana olick in houston all right. Sticking with rebuilding, albeit on a much larger scale, your next guest runs acom, a company that is actively involved in helping to rebuild postHurricane Harvey<\/a> and probably postsouth florida irma as well. Working with governments all over the place lets bring in aecoms ceo mike burke once again i want to get to a potential infrastructure bill but that can wait for a couple of moments lets talk about rebuilding. Diana just obviously hit on the residential side you do big industrialscale projects how is aecom coming in have you had people say we need you to come in and rebuild this 100 million thing brian, first of all, thanks for having me. And yes, we are involved we have hundreds of employees on the ground right now working with the federal Emergency Responders<\/a> currently and i think people are not fully understanding the magnitude of the issue right now with both Hurricane Harvey<\/a> and irma. Youve heard the estimates 200 billion of damage but just to put it in perspective, thats 25 greater than the damage caused by Hurricane Katrina<\/a>. And here we are 12 years after Hurricane Katrina<\/a> and were still rebuilding the infrastructure of new orleans. So i think people are misunderstanding the complexity of the challenge but were on the ground and were focused on rebuilding the texas coastline as well as florida right now specifically, because you guys do so much, what kinds of jobs are you on . We saw refineries with their own eyes that had water in them. Obviously bridges damaged, roads damaged. What specifically are you guys doing to help, mike . The first task is understanding, appraising and estimating the damage so that the federal government can get their hands around it. So the first order of business is to understand the scope and depth of the problem on the ground as it relates to transportation infrastructure, as it relates to power the entire water and drinking systems are of critical importance and then of course the shipping channel. You know, houston being the fourth largest port and the shipping channel which is such an important cog in the machine of the supply chain of the United States<\/a>. Those are the assessments that are under way right now. Whats the biggest obstacle, michael, right now in terms of getting that infrastructure rebuilt . I mean, youre talking about whats gone on with katrina, that the rebuilding is still under way. So whats stood in the way for all this time . Is it mostly just funding . Well, its a multitude of issues first of all, people understand the complexity of the challenge, first of all secondly is coordinating, youve got state, federal, local governments that are all trying to do their best to take on this challenge. But coordinating all of the First Responders<\/a> that are trying to deal with this. And then of course funding and were expecting there to be a significant amount of federal funding to address this challenge. But again, when you talk about a 200 billion program, thats more than double the annual budget for the entire state of texas. So this is an enormous amount of money thats going to be necessary to rebuild the infrastructure of these cities have you done a back of the envelope calculation for investors in terms of if you get a percentage of whatever business you think is out there, what could that mean for aecom well, we havent given any estimates, and i wouldnt want to on this show, but just to give you a sense of the 200 billion generally speaking, youre looking at somewhere between 30 to 50 of the damage is infrastructurerelated. Defining infrastructure very broadly. And that money of course will be spent over many years, as i mentioned in the katrina example that were still 12 years into that recovery. That will be spread out over a number of years but we havent given estimates just yet all right, michael, thank you for joining us we appreciate it thank you for having me Michael Burke<\/a> all right lets get a market flash now with dom chu dom. Were watching shares right now, brian, of Western Digital<\/a> because we have a report now from reuters citing sources familiar that toshiba now favors a deal with Western Digital<\/a> groups consortium bid for its memory chip unit also that report going on to say that toshibas shift away from the original baneled group that includes s. K. Hinix, a south korean company, follows ownership concession thats are being made by Western Digital<\/a> in order to acquire the concerns here its unclear whether or not toshiba will reach a decision on the chip sale on wednesday, but these things are in the works and thats whats causing those shares to spike. You may recall, guys, that a lot of this drama has to do with whether or not one consortium, and apple is part of that group, may be in the running to acquire this particular memory chip unit but that drama playing out a little bit more according to these reuters reports, guys. Back over to you another incremental move. Thanks, dom. Millennials and money. A new survey out showing they arent doing too well on that front. The results first on cnbc, next. The greatest population shift in Human History<\/a> is happening before our eyes. Sixty to seventy Million People<\/a> are moving to cities every year. At pgim, we help investors see the implications of longterm mega trends, like the primetime of urban expansion, pinpointing opportunities to capture alpha in real estate, infrastructure, and emerging markets. Partner with pgim, the Global Investment<\/a> management businesses of prudential. Its not just a car, its your daily treat. Go ahead, spoil yourself. The es and es hybrid. Experience amazing. We can live paycheck to paycheck and thats fine i dont consider that to be super healthy. Financial anxiety feels like an exhale you cant really get rid of if youre swamped in debt, be it Student Loans<\/a> or automotive payments or more increasingly hospital bills and health care costs, it can seem like theres no way out of there. When it comes to saving, i still pretty suck. That was a glimpse at some of the responses participants gave in a new survey, millennials and money, commissioned by wells fargo. The study interviewed more than 1,700 people ages 20 to 36, and asked about their relationship with money, how they feel about the markets and their Financial Health<\/a> here to share the findings in a first on cnbc interview, christie mitchell, thanks for being with us. Good to be here almost no surprise a lot of people in this age group feel they have a lot of financial pressures. Are we to believe this is any more so than past generations . Im far from millennial, but when i was that age i felt the same exact way yeah, i would say it really is more of what i call a one two three punch. So certainly they have a lot of the same concerns that many people felt when they were sort of of a similar age, but they are different and theyre different for a couple of reasons. One, they carry a lot of financial debt the average graduate coming out of college today has about 30,000 worth of college debt. And thats about a 60 increase since 2009 secondly, the evidence, very, very low levels of financial literacy, which is really curious given that theyre one the besteducated generations what did they spend that money on what did they good god. And third, they came of age at a very difficult time many of them went into the workforce thinking about money and finance at a time when the u. S. And other global economies were experiencing significant it was way worse than the Great Depression<\/a>, right . Well, i think it had they think so well, i think they do think so but i think also the experience of all that was very important because they connect so much around these issues. So in some ways i think it probably was not to minimize, but it is if your folks lose their job, it hurts you too. It affects you for a long time do a lot of these millennials say that their parents were really i mean, it wasnt as bad nearly as the 30s, but a lot of people did lose their jobs and it does stick with you. And it changes your behavior for potentially the rest of your life as we looked across all the millennials that we interviewed, about 20 said theyre not invested in the stock market and they never would be. About 53 said they were not comfortable even when they had investments in marketable securities and i think thats really important. I think that lack of confidence is something that you know, we really need to find a way to work through with them if they continue on this rate, theyre never going to have enough savings for retirement ever. No, they arent and theyre such an important generation i think its important to contextualize the fact that they make up 25 of the population today. Theyll be 75 of the working population by 2025 and in the next 20 to 30 years theyll inherit 30 trillion worth of wealth. So helping them think through these issues and really understand how important it is to not just save but invest i think is a critical why would they invest would y are going to inherit 32 trillion where did that come from they claim they dont right here is whats fascinating. As we were looking through all these data one of the things that we stumbled upon is positive Financial Financial<\/a> app financial applicator the pfi is correlated around happiness and confidence around finance and a statement around thinking that the stock market was a good place to and fast really important and engagement drives happiness and thats a connection as you rightly point out that millennials dont understand they would tell you that happiness is about relationship. Actually finances do matter to them whats the difference. 20 say theyll never be invested in the marks and 53 say theyll not be comfortable in the markets so theyll invest but theyre not comfortable. They have a lot of anxiety and fear do you think thatll change if you dont put your money in the stock market, it is kind of hard making money. There will never be inflation i think there is a better recipe for prescription for change in the data which is activism actually create more conference i thi conferenc confidence grandparents talk to your millennials about money and finance. Dont give them fish or dont teach them how to fish fish with them we care because it is by far of the largest generation, it is only 45 million of us. There is 88 million millennials and 75 baby boomers. The millennials are going to drive a lot of that. And we do care, who does not want their children and grandchildren to be happy. Christie, thank you management of ceo all right, coming up, wall street calls that you need to know about onste ock rising of 20 , from here street talk is coming up. I cant wait for her to have that College Experience<\/a> that i had. The classes, the friends, the independence. And since we planned for it, that student debt is the one experience, im glad shell miss when you have the right Financial Advisor<\/a>, life can be brilliant. Ameriprise time for street talk tesla, shocking calls from jeffery this morning of, jeffery is saying with a quote, heavy heart, they dont believe the companys ve companys business can be scaled the price of the stock, 280 i have a feeling it is a topic of conversation on fast money tonight probably true second stock, red hat it continues to gain tractions and analysts think we can see red hat. It is a 107 stock right now. Apple Morgan Stanley<\/a> raising her price on the stock to 194 to 182. The company will boost the average selling price selling for 999. Morgan stanley believes that apple will be able to increase prices without hurting demands a lot of exposure in soil iln valley they like the west coast exposure, they like the fact that evaluation trades of discounts. There is a little bit of concern. They say the company is fine and they love the west coast versing east coast mentally. Can i give a shout out to our team did you notice a new look for street talk. It looks spectacular. Given your outfit and the color, we look like a Seattle Seahawks<\/a> home game. Michelle all right, the lawsuit against equifax are piling up. Massachusetts is the first state to slap the company with the suit following the massive data breach we learned of an earlier breach from the big one the states attorney general joining us on cnbc and the nasdaq of 20 and stocks in the record high club. Second hour of power begins on the other side of this break when you look at the mercedesbenz glc. With its hightech cameras and radar, contemporary cockpit, three hundred and sixty Degree Network<\/a> of driverassist technologies, and sporty performance. Whats most impressive about the glc . All depends on your point of view. Lease the glc300 for 479 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. What . Pony neighing] hey gary. Oh. Whats with the dogsized horse . Im crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. Isnt that right warren . Well, you could get support from thinkorswims inapp chat. It lets you chat and share your screen directly with a live person right from the app, so you dont need a comfort pony. Oh, so what about my motivational meerkat . Inapp chat on thinkorswim. Only at td ameritrade. Welcome back, here is whats coming up for the second hour. We are going to tie everything together massachusetts wants equifax to show them the money. The state is the first to file a lawsuit against the company. The attorney general is here ahead. Former race car drivers and nascar team owner will join us big engines and money and big sponsorships buckle up because power lunch starts right now and lets get a check on our mark markets. Stocks are remaining at an time highs. We are watching telecom and financials there autozone is having a rough day and take a look at snap share following the report of the new companys enrollment of the u. S. Declining 2. 5 President Trump<\/a> is speaking in front of the United Nations<\/a> General Assembly<\/a> today eamon javers is joining us now hi michelle, you were there President Trump<\/a> is teeing off on a number of world issues the biggest news was the way he talked about north korea, both the potential u. S. Response to the north korea situation and also what he called the north koreas leader here is the president later today. Well have no choice but to totally destroy north korea. Rocket man is on a Suicide Mission<\/a> for himself and for his regime the president there with an apparently intentional decision to be little the north koreas leader as rocket man, well see if thats a effective diplomacy. The president using phrases that we have not heard used at the United Nations<\/a> before. He urged nations embrace their own sovereignty but to also Work Together<\/a> major forces of the world are in conflict and some in fact are going to hell. But, the powerful people in this room under the guidance and offices of United Nations<\/a> can solve many of these vicious and complex problem. Michelle, as of all of these speeches, there are many different intended audiences with this, you can see that playing out in realtime on twitter as the white house communication teams amplified the president using the phrase radical islamic terrorism in his speech other official in the white house tweeted that out right as the speech is happening clearly to intend to target his Political Base<\/a> here in the United States<\/a> making sure that they know hes using the language they expect him to use. Michelle the physical audiences reaction was interesting to watch as well. Benjamin netanyahu nodding his head in agreement as the president spoke about iran the representative from iran sitting there stone fad face ase stared in the camera and taking notes. A lot of detailed note taking by a lot of countries there during that speech so they did not have to look up or reacted it is a Global Version<\/a> of the sea saw effective as we see there. Although this one played out a lot more dimensions. Thank you, eamon. You bet ylan mui has the number. Reporter key republicans have reached a deal for the parameters of tax. I am told that lawmakers are eyeing the package of 1 to 2 trillion in those cuts. Those cuts would add in the deficit. Some of these details still remain influx and in order to the process to start, a bill would have to make through the Senate Budget<\/a> committee. One thing that does appear clear that republican lawmakers plan to rely on dynamic scoring in order to make some of those numbers work i do not believe we should limit ourselves in status. I i dont know a number for an outer limit, i believe we should have the largest number get with adequate dynamic scoring we are still in the process of negotiating this. Well not make it. He says until the white house of ways and means and the Senate Finance<\/a> committee get what you call a framework from them i think we need that because we are operating of what can be signed by the president. You heard there from senator mike and chuck grassley. He says he still wants to hear more details before he makes his his mind this issue is expected to come up well try to find out more information for you guys and bring it to you before we have it thank you ylan. We have our cnbc larry kudlow a much deeper number and thats a lot of spending and detud deductio deductions i kind of liked that number. It is given good parameters. The Senate Budget<\/a> committee, theyll come up with a solution from reconciliations i think it is very important, very important that senathe sen that runs the Budget Committee<\/a> and diane blanc, i think they have to go, maybe they bring the ways of means and finance committee, too because they are the bosses of the joint tax community. This is just saying, we want gross dynamics gentleman and and gentlemen and ladies. We want gross dynamics. I would like to see a little bit of therapy thats all i ask nick. Let me jump in there. The therapy is what they are talking about for dynamic scoring. They are going to make the numbers work thats a huge big flag for me that it is not going to be about tax reform but it is about tax cut. Theyll use dynamic scoring to figure out a way to pay some of it we got corporate today and paul ryan last week, hey, i guess it is okay if it blows up of the deficit. 1. 5 trillion making the number closer so for the audience, we want to explain dynamic scoring if we put together a budget and assume tax heights or cuts, you can assume that you can extrapolate it out. Something that congress resists, now theyre going to start using it that gives you a lot more room trying to figure out and well have more room for tax cuts let me put this out if you redeuce the marginal tax rate on the last dollar earned and invested and the last hour worked and last risk taking, if you redeuce those, you will get far more Economic Activities<\/a> across the bureau far more we have seen this in history the 60s and 80s and 90s, i can go on. I think leaning towards and the tax cut, i like the lead right now they are leaning in the right direction. Rhetoric is improving. I will say this. I think that they just got to be as tough as nails. Theyll want some revenue raises but the point of the exercise is a policy theyre saying we are going to cut tax rates and well change behaviors and thats what it embodies in the actual Economic Growth<\/a> baseline. Senat senat senat senator pat toomey whos a hero of mine. When i was a kid working in the reagans office, it was two. There was no law and no constitutional thing going on here it is custom. It is custom. I like to break customs and shake it up a little bit if you got it wrong then you dump your problems on people that were not connected. If you screw up and 20 years, your kids are the ones i like the short term because you got to live with whatever you decide we try and i guess first is deficit. I dont need to know that all this talk about deficit monitoring is a convenient way to stop tax cut. So i would like to give it more time to pay for themselves larry, paul ryan is not talking about it now we are going to have 2 trillion tax cuts and not worried about it for ten years or 20 years. Remember the bush tax cuts did the same thing all i am saying nick, all i am saying is we try Big Government<\/a> spending which creates huge deficits in debt. Lets try another approach. Lets try the tax cut route and business competitor route. Many wont work you dont have to convince me give us a chance. The other team i am just saying it could be great in 20 years but i am saying it is longer out and makes i easier not to think about it quickly nick, is diane black the most powerful secret weapon out there . Shes on the ways and Means Committee<\/a> and we never hear from her. Wait for the house to come back next week, we got a broad framework budget which is broadway from next week. The next is what the committee in the house are saying out. We have 1. 5 trillion to work with what goes in there . Thats what well learn a lot. Thank you gentlemen thank you larry, thank you nick we are still monitoring hurricane maria. Here is the latest the storm hitting the island dominica, it is expected to hit with sustained winds of 155 Miles Per Hour<\/a> puerto rico governor saying this could bring more winds and water. Irma killed three people the company knew the weakness in the system and failed to address them mau maura healy is joining us next Nascar Tony Stewart<\/a> is joining us and more, all that and much more is coming up on power lunch. Is the monolithic view of emerging markets obsolete . At pgim, we see alpa in the trends, driving specific sectors of out performance. Where a rising middle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Everyday our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment<\/a> management businesses of prudential. Shares are jumping the deal is valued at 1. 5 billion first on cnbc interview is the ceo of bob evans farm. That is food for food deal, mike, why did you make it. Tit is good to be with you, brian. Mike townsley it is a great opportunity for our shareholders to really get the value out of the stock Going Forward<\/a>. You know if you look at what attracted post to bob evans, it was really our refrigerator side base business that we have been in 20 years thats been growing double digits for the last 20 years. We have with been growing of 14 kegger our market position in our refrigerator size, we have a 15 market shares and growing at a rate that far exceeds our competitors. The neat part about our products are, if we can get someone to try it, two out of three people will come back and buy it again. The category lightly penetrated so it is a huge upside to our product line mike, under the deal, you will be in charge of the refrigerated Retail Business<\/a> and the other guy will continue on his commercial of the business it seems to be a tough environment on food in general do you feel in this sort of environment where packages who are not appreciated is being under valued i think what you are seeing is what attracted posts to bob evans is the performance that we have seen on the exterior of the perimeter of the Grocery Store<\/a> today is well documented that the shopper behavior is migrated of the shoppers shopping more and more perishable and fresher type items versing the middle of the Grocery Store<\/a>. Thats what makes it attractive to post of bob evans there is so much talk about the way, you highlighted this just now of people shopping around the edges of the store of more fresh food how does that play into the future of bob evans and how you are going to try to attract that shopper. Well, i mean we are positioning nicely to do that. We are taking marketing span in the last few years continuing to take it up and well be up three or four million this year verses last year, really to look at how do we acquire households thats the name of the game with our refrigerator side dish and representing half of our Business Today<\/a> whats an ampexample of refrigerator side dish we have our 24 ounce smashed potatoes thats distributed all over the state and all across the country. Literally, you can have really, really good smash potatoes prepared in five minutes part of the reasons that we had such success with that is neat to consumers today consumers spend 20 or 30 minutes making meal and they spend most of that time on whatever thats at the center of the plate. They want quality side dish they they can have in the short period of time that thats where they make the mark we talk a lot about the family style restaurants whats wrong with the american Restaurant Business<\/a> right now. Chilly completely changed its entire concept and whats happening . All i can do is comment on restaurants and really deemed the separations of the food business and restaurants created shareholders values it was difficult for us to tell the gross side wth size of the. We felt that for creating values shareholders and maximizing that, we got a fantastic price for that and really created values and a lot to tell the story of our refrigerated food businesses mike, thank you very much very much to be on cnbc, from evans farms. Senator warren is with us now, shes going to speak with jim cramer tonight they had a breach before the big one that was announced a week ago. This comes as massachusetts becomes the first state to file a lawsuit against equifax. The states attorney general is going to join us in just a few minutes. Toys r us is filing for bankruptcy right before the Christmas Season<\/a> ouch, what does that mean for the toy industry well speak with the man atth says social media has failed in bringing people together and in fact may bring harm. Stick around if youd have told me three years ago. That wed be downloading in seconds, what used to take. Minutes. That guests would compliment our wifi. That we could video conference. And do it like that. snaps if youd have told me that i could afford. A gigspeed. A gigspeed network. Its like 20 times faster than what most people have. Id of said. Id of said youre dreaming. Dreaming definitely dreaming. Then again, dreaming is how i got this far. Now more businesses in more places can afford to dream gig. Comcast, building americas largest gigspeed network. Now more businesses in more places can afford to dream gig. Kevin, meet yourkeviner. Kevin Kevin Kevin Kevin<\/a> Kevin Kevin Kevin<\/a> kevin kevin trusted advice for life. Kevin, hows your mom . Life well planned. See what a Raymond James<\/a> Financial Advisor<\/a> can do for you. Integrate any part of your business, and have your systems work as one. The ibm cloud. The cloud for enterprise. Yours. The so they called the fire, yodepartment for us. Clearly, my first truck was on the scene within five minutes. I am grateful we all made it out safely. To protect what you love, call 1800adtcares youre searching for something. Whoooo. Like the perfect deal. On the perfect hotel. So wouldnt it be perfect if. There was a single site. Where you could find the. Right hotel for you at the best price . There is. Because tripadvisor now compares. Prices from over 200 booking. Sites. To save you up to 30 . On the hotel you want. Trust this birds words. Tripadvisor. The latest reviews. The lowest prices. Toys r us failing for bankrupt production as first reported on our website on cnbc. Com the company is doing it right before the Christmas Season<\/a>. The company is taken over by kkr back in 2006 for 6. 6 billion. It is still dealing with the debt incur of that deal nearly 5 billion worth toy makers have down over the past three months. 2006 they got into this equity deal it is not how it is supposed to work and 11 years later, this has mott workednot worked out a thought. They filed for bankruptcy twice or they are private equity deals or a combination of the two. This is just a restructuring and a lot of retailing have been about liquidation and they are gone you go into toys r us with a 6yearold or 5yearold and it is fun they run them up and it is the happiest place on earth. Coming up, President Trump<\/a> giving a tough speech at the u. N. This morning rein ra well get reactions from kneneo ferguson who correctly predicted on this show that donald trump will win the production and ll speak with massachusetts whos the first state who sued equifax, how much are they looking for, well find out. Stick around some things are simply impossible to ignore. The strikingly designed lexus nx turbo and hybrid. Lease the 2017 nx turbo for 299 a month for 36 months. Experience amazing at your lexus dealer. People dont invest in stocks and bonds. They dont invest in alternatives or municipal strategies. What people really invest in is what they hope to get out of life. But helping them get there means you cant approach investing from just one point of view. Because its only when you collaborate and crosspollinate many points of view that Something Wonderful<\/a> can happen. Those people might just get what they want out of life. Or they could get even more. Hello i am sue herrera, here ace news upda is a news update at this hour. Moments ago a powerful earthquake in mexico smoke is being supportreported e of the buildings thousands of people have now left buildings and remaining in the street roite reuters is saying it is a 7. 4 category which is a serious earthquake forecasters warning the storm could leave some parts of puerto rico and the u. S. Virgin islands un uninhabitantab uninhabitant for months. The recall includes the 2013 model years of chrysler, fiat. Most of the recalls are here in the u. S. Playing youth football could have longterm effects researchers assessed 200 middle age men at youth tho thats the news update at this hour, i am saying that reuters is reporting that it is a 7. 4 quake, it hit five miles southeast in the state of puebla we are keeping an eye on for this for you melissa, it is still a developing story massachusetts filed a lawsuit against equifax. The states attorney general writing, we allege that equifax knew about the vulnerabilities for months but utterly failed to keep the personal information public for us. We reached out to equifax for comments but have not heard back joining us is our Massachusetts Attorney<\/a> general, maura healy, thank you for joining us, we appreciate it. Great to be with you, melissa. When you say you want equifax to pay, whats the end game here the end game is making sure it never happens again so many consumers are at risk of Identity Theft<\/a> and serious financial fraud and harm the first thing that needs to happen is equifax needs to make this right they need to pay for their mistakes and leaving so many of us so vulnerable anybody who maybe the victim of Identity Theft<\/a> or fraud, equifax is going to have the pay theyre going to have to pay to put new system in place. I am calling on them to pay for all credit freezes and ongoing credit monitoring. Thats what needs to happen in the first instance in all of my years as an attorney general and Office Investigating<\/a> data breach, melissa, this is as bad as it gets the impact and when hackers using information, it may not be now, it maybe years from now we dont know that sort of damage of what they maybe. How do you quantify what equifax should pay today well continue with our lawsuit and make sure we get everything from thoem that we need to make sure consumers are protected. You are right. Thats why this is so bad equifax is out there collecting data most americans dont know that equifax is collecting the data and they are selling that to companies. It is their job to safe guard that data. Whats worse is now that it appears they knew about this breach but did not tell the public about it until several weeks later. And whats really bad is this whole time there was a computer patch available that would have prevented the exploitation of this information all have been brought up many times we have dmoknown about it which is an important point we talk a lot about facebook and twitter and privacy and when we sign up for these products and things, we are either knowingly or unknowingly giving away our rights to privacy. That choice never happens with any of the Credit Rating<\/a> agencies, you know normally, if Something Like<\/a> this would happen, the customers might turn their backs on the product but the customers are really the banks and not the individuals, how do we gaet in behavior that would lead to banks that we are not going to use this particular company thats why we need to see legislations potentially in congress and well work in the state levels here in massachusetts to make it right remember this is our information and our personal data and information, customers are not as you point out opting in i think what we are looking at is maybe we cannot align the system properly and incentivize them really, the consumers are not the consumerconsumers, the s are the banks. We need to mistake this right and Going Forward<\/a> if there is going to be collection of this information and done in a way that consumers dont get harmed. It appears that this company and perhaps others may have been incentivized and collect and sell it is why i am suing and why i am working senator warren and others in congress to make sure the right wilhelmsincentives ar. Were you breached. Right now we believe of an estimated 3 million massachusetts customers including yourself . This is about whats happening in massachusetts part of the issue here to be honest with you, the company have yet properly identified whos been breach. They told all of us that we have been victims of breach but we need to find out as we will through investigations thank you very much for your time, we appreciate it good to be with you maura healy, massachusetts general. The president laid out his americas first ideology assembly lets get insights from our best selling author, welcome back to power lunch. You predicted that he would win. Tell us what do you think of the speech at the u. N. Today well, i am sure any number of liberal commentator havs have tweeted their horror and disgust. A great deal of it, indeed the president was illustrating one of the paradox of his presidency if you had asked people a year ago of what his attitude of the United Nations<\/a>, they would assume that it is disrespectful towards nato and the union the speech he gave today is an Important Institution<\/a> for a strong nations state li like td states and trump has used the u. N. Very effectively. Hats off to ambassador nikki haley. I thought the speech was in lining with trumps argument you said there is a lot of liberal commentators upset by it but you said there were parts that you liked what did you like . I like the fact of americas first. The first point is a really important one. The u. N. Is not designed to be world government the u. N. Is designed to bring together maybe 200 nation states President Trump<\/a> has shown himself able to understand the importance of that institution and used it effectively and particularly on the key issue of north korea. I like the tough talk of north korea. The Obama Administration<\/a> did disaster on this issue all it did was to impose a succession of weak sanctions that accelerated the north koreas arms program that administration gave us so plan within a year of departure, hydrog kim jongun would have a hydrogen bomb. I think the Trump Administration<\/a> is being right to take up that line people have to believe that the u. S. Is serious and if there is not a diplomatic solution i do not share the view thats widespread in Foreign Policy<\/a> circles. This is an empty bluff the reason that i share is jim mattis is a man we should take extremely seriously. When jonah mattis says tlhere i a military option, you Better Believe<\/a> him. Now, niall, can i move on this is a hot topic and you are talking about it and thats technologys role in america and the world. In the septembers issues of affairs, you write, we should all tweet their messy issues with the skepticism they deserve. Why did you write that i have been working on a book of network and history and i am struck when i am writing in the Extraordinary Part<\/a> i think i send the coming backlash the storm is gathering of the Silicon Valley<\/a> there are those in the left who wants to see antitrust actions against Silicon Valley<\/a> companies and those in the right like steve bannon who thinks they should be regulated. At this point, there is never a powerful company in americas history than facebook. 45 of americans get their news from the Facebook News<\/a> feeds if facebook decides to tweak its algorithm in a way to skew that news speed thats an enormous implications. I dont doubt Mark Zuckerbergs<\/a> sincerity. I think hes sincerely believing the world will be a better place when everybody is connected. If you do connect the world together like that, dont expect a happy world which everybody shares cat videos. Thats not the way social net york worked. I love cat videos well, people share cat videos but they share other stuff to give just one example. One striking feature of social networks throughout history regardless of how technology operates is they do have a tendency so polarize the tendency for people to congregate along ideology. Thats really what we saw in the 2016 election, quite as polarization on social network you should not expect it to be a hominous world mr. Ferguson, it is great to have you on. And the book hes referring to is called the square and the tower. Coming up, there stewart, you are getting extremely tipaenpate give us twominutes, well be back with you after the break. 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When you have the right Financial Advisor<\/a>, life can be brilliant. Ameriprise the new york giants got fed to the lions last night. It is been a mixed season for nfl ratings so far this week, fox reported of a jump in race but gain in cnbc and have failed. Also, hard to come by, our super star dan joining us now is tony stewart and danica patri patrick lets get right to it thank you for joining us on cnbc thanks for having us. I know you think that danica will stay in the sport, but she did not get the results she wanted, why do you think she has the trouble . The media is harder on her performance on anybody and harder than we were, i dont think we were dissatisfied with her performance at all, we got steal a stale and in a scenario that we would not able to carry further than what we had shes a great talent and you know sponsorship is hard all around right now every form of sports are having trouble with viewer ship and that makes it difficult to attract sponsors it is hard from all aspects. It is not just hard for danica, the industry is hard right now the stock market is at record highs. You are one of the few guys at home depot that can keep the same sponsor, you and Jimmie Johnson<\/a> and jeff gordon and now we are seeing drivers changing color schemes every race why is that . You know back when i was running at home depot. We had home depot for ten years and they were the only sponsors on a ten year stretch. It costs close to 10 or 20 million to do that for one season we have two different sponsor s and one week the sponsorship is on the panel and next week the paint scheme changes but those sponsors are still on the car. It makes it efficient for them and they still get a bet every bang for their bucks than just being on the car with one different paint scheme like that for the whole season i think going back and forth like that is a combination that we have seen in our organization thats a pretty powerful equation i like the chase championship series lets do this, lets pretend that your last name is not stewart but france listen, so the product is really good, what change if any you would make to nascar right now . Well, i think it is easy for me to have a bunch but i am not sure if the big picture that i see every aspect of why they make the decisions they make i think it is hard it is a Family Owned Company<\/a> thats successful but mentioned, football ratings are down, baseball ratings were down, everythings down. Were at an era where we all have smartphones, we all can get information right now and nobodys patient about anybody like you mentioned before the break. Its easy for me to sit in one space, but im sitting fidgeting with my phone the whole time i was sitting here as well for the same reason everybody else does. I think thats made it hard for the entertainment entindustry, only sports but all the Entertainment Industry<\/a> of keeping everybodys attention. Thats trickling down on the sponsorship side as well. Listen, good luck again, 78 were in new jersey so we have a homer for martin truex jr. , only jersey driver in the series. Stewart haas racing, id like to see you test one of the haasf1 cars soon. Thank you, guys, appreciate it. Be sure to tune in sunday, nbc sports network, coverage of the Monster Energy<\/a> series the playoffs were in them now. 2 00 p. M. Eastern time. Every day we talk about a new high for the dow stock markets around the world hitting new highs. Up next the trading nation team will tell you if your money is better off here or maybe abroad. Stay tuned stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders<\/a> connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. Not rebalancing your portfolio. Pursuing your passion, not reacting to market downturns. Focused on what you love, not how your money will last through retirement. Let us help you with those decisions, and get on with your life. We make it easier to plan for retirement with day one target date funds from prudential. Look forward to your 401k plan. Want to upadate you on a developing story, mexico rocked by an earthquake, epicenter of the earthquake, 70 miles southeast of mexico city the mexican staock exchange halted all trading some buildings in the roma neighborhood of mexico city collapsed. Early reports suggested the buildings in mexico were swaying, woquote, sickeningly its been a good year for american stocks. Some markets around the world are doing better than we are lets bring in our trading nation team. First to you in the chart here, anything out there look particularly tasty to you internationally . Well, we Like International<\/a> when i look at the ratio chart, what im seeing with the s p 500 and the efa index, itself, continuing to see outperformance in this. I suspect really its due to the weakening that weve seen in the dollar as of late. Were going to get news coming from the fed, some news next week perhaps about how theyre going to pay back some of the debt, ult pimately leading to strengthening in the dollar. This point in time, i want to stay long the International Stocks<\/a> outperformance is going to continue for a while longer based on the charts. Thank you borris, what about you know . Efa, oneyear return is 20 , threeyear return is 1 . Its clearly the reversion to the mean whether the reversion to the mean continues, the answer i think is yes thats the big story Going Forward<\/a>. I think International Stocks<\/a> outperform because theyre early in their recover ary cycle, going to get a benefit from all sorts of factors including technology factors i think the bet here much more is toward long efa, short s p if you want to do a long short trade. Okay, guys, thank you very much borris, craig, appreciate that for more trading nation, go to our website, tradingnation. Cnbc. Com and check, please. Now the latest from tradingnation. Cnbc. Com and word from our sponsor. A double top is a chart formation that suggests an up trend may be ending and ready to reverse. Sometimes called an m formation because the pattern likes like an m, two well defined peaks at approximately the same price traders view a break of the lowest low in the formation as a bearish signal welcome back severe earthquake hitting mexico city, 75 miles south of mexico city this is our Sister Network<\/a> telemundo showing video at the top, says hace unos momentos our colleague doing live coverage of whats happening down there, quite severe there are reports and lots of videos crossing social media, buildings collapsing and people certainly injured as we watch this unfold. Trading on the bulsa is suspended now, halted, the pace sew did have losses on back of this again, were watching this developing story the pictures are so dramatic. This comes ten days after another very severe earthquake in the southern part of mexico so they were already on watch for aftershocks. One thing to watch for, mexicans will sleep outside at night for the next as a result of this earthquake. And marie you coa coming into rico, thoughts and prayers with everybody out there. A tough couple weeks. Sure has. Thanks for watching power lunch. Closing bell starts right now. And well have more coverage of all of these events welcome to the closing bell, everybody, im kelly evans at the new york stock exchange. Im bill griffeth, the dow, s p and nasdaq on track to close at record highs. Coming up, were going to talk about whether the sky is the limit for this market right now. Even as the fed begins its two days of meetings here. So much to distract us, again, a stalwart move higher today. Hurricane maria is threatening to devastate puerto rico after causing catastrophic damage to dominica already were going to look at","publisher":{"@type":"Organization","name":"archive.org","logo":{"@type":"ImageObject","width":"800","height":"600","url":"\/\/ia800403.us.archive.org\/23\/items\/CNBC_20170919_170000_Power_Lunch\/CNBC_20170919_170000_Power_Lunch.thumbs\/CNBC_20170919_170000_Power_Lunch_000001.jpg"}},"autauthor":{"@type":"Organization"},"author":{"sameAs":"archive.org","name":"archive.org"}}],"coverageEndTime":"20240629T12:35:10+00:00"}