Date on where the various districts of the Federal Reserve think the economy stands right now. Plus, jpmorgan taking on square and paypal with a big move into the Small Business space could the banks upend the market and these highflying stocks later, gm doubling down on its autonomous ridesharing business the ceo of cruise will be here to explain why he thinks ridesharing will thrive again after the pandemic power lunch starts right now hi, everybody. Lets go to dominic chu with big movers. I have taken over tylers spot at the telustrator. I will show you because tyler told us about the whiplash weve seen on the headlines. The markets are largely pricing in a lot of nothing right now. We were marginally lower, marginally higher at one point, and now were mixed across the board. Dow industrials off 30 points. The s p 500 up 0. 1 of 1 or four handles and nasdaq composite outperforming, up 13 basis points to be specific there. 3446 the last level for the s p 500. If you take a look at some of the big story lines we are following so for today, check out whats happening now with netflix shares one of the biggest losses weve seen that stock in a while. Down about 7 . Netflix coming off an Earnings Report that was disappointing for many investors out there, some of the subscriber Growth Numbers perhaps lagging expectations those shares, weve seen a nice rollover here. Well see if that can find some kind of abatement with the netflix down moves on the flip side, a social media name not nearly as big as netflix but a eyecatching move, snap, the Parent Company of snapchat, up near the highs of the day, 31 to the upside much better than expected Earnings Report from snapchat showing better user growth trends, better advertising trends all those things taking snap to the upside all of a sudden you have many internet names, tyler, a lot in focus, the big cap names and snap and netflix back over to you thank you very much, dom. Lets get to Steve Liesman for the details from the feds beige book out at the top of the hour. Hi, steve. Economic activity, the beige book says to increase across all districts. Thats good. It says the pace was characterized as slight to modest in most districts there was a lot of variability out there across industries. Manufacturing generally increased at a modest pace Residential Housing had steady demand commercial real estate conditions continue to deteriorate in many districts. Auto sales were good there was a leveling off this is fairly good news in context, i suppose leveling off retail sales of a slight uptick in tourism activity on the employment front, employment it said increased in almost all districts growth remains slow. It did say that firms continue to report new furloughs and layoffs. And this is something we talked about last month labor markets are tight and its partially attributed to quoshgers health and child care concerns thats been a big issue. We talked about the decline of prime age working women. On prices, they rose modestly. Some sectors it, like construction, manufacturing, retail, wholesale, they passed along higher costs to consumers. This is finally an interesting comment. Multiple districts reported continue additional cost because of covid19, ppp, sanitation, testing and Technology Lead for Remote Working those are the highlights ill dig back in and see if theres anything else worth talking about. Thank you basically a middling report from the Federal Reserve. As we react to that with lindsey, chief economist with stiefel and Steve Hartman with Wells Fargo Asset Management it sounds like things are moving forward, at least not backward, in most segments sections of the country, but at a more modest pace. Exactly it seems like were walking this fine line, which is what weve heard from fed officials, acknowledging the improvement weve seen from those low, low levels in the second quarter, much of which can be attributed to fed policy and still highlighting the lingering weakness were seeing across a number of sectors, highlighting the uncertainty and risk we will face going into the end of the year and longer term into the outlook and beyond its a very muted, modest ballot theres still a lot of ground to regain kirk, do you see any possibility that the economy could flatten out and turn negative over the next few months we had an event yesterday with mario gabelli, whos a brilliant investor he thinks 2021 is going to be a very good year economically. Do you i think 2021, and the markets are discountth counting is going to be a very good year what could trip up the market near term is a lack of clarity on the election. So, a lot of variables hanging out there and the election clearly is a wild card, but, at the market levels were at, clearly 2021 looks to be a pretty good year. The market seems to be presuming, kirk, there will be a vaccine that will be effective, that will be widely distributed within the next few months or by middle 2021. That seems to be, to me, underpinning an awful lot of the market optimism to the extent we have it. Oh, very much so. If you look at all the previous beige books, what they hinted at is employment, and recovery in employment is very much a function of vaccine. To your point, the markets are very dependent on a vaccine. And what im concerned about is i think the vaccine will take a bit longer to roll out than we expect also my expectation is for a difficult winter, especially in the colder climate a lot of wild cards out there. At the end of the day, i think 2021 will be pretty good. I heard last night, to your point, the largest rate of case increase is in the state of north dakota, where cold weather has obviously probably already arrived. Lindsey, lets talk a little bit about Small Businesses and how they are doing and how they may likely do as we move into 2021 my concern is an awful lot of large stores were kind of reguarded as essential businesses and allowed to stay open and they have the capital behind them to be able to survive tough times. But that smaller retail businesses, the boutiques, the nail shops, the tattoo, all of those places are going to have a heck much a lot harder time and we may see a lot of business failure, a lot of unemployment that traces back there and then a lot of pain in the real estate world where buildings are going to go empty for a long period of time and landlords are going to have to find a way to work with their lenders. I think youre right. Small businesses have been hit particularly hard during this pandemic if we look at u. S. Chamber data, about a quarter of Small Businesses have already closed their doors, at least temporarily, since the onset of the pandemic and nearly twothirds are worried they will be forced to close their doors permanently by the end of the year. So, were talking thousands of restaurants, thousands of boutiques and shops, nightclubs, bars, that are already closed and that more face permanent closure and are no longer going to be employing american when we look at how businesses have been able to bridge that gap, at least temporarily at the onset of the pandemic, many are now saying, well, because the timeline has been extended so precipitously, they do face permanent closures, additional barriers, additional restrictions and additional costs to keeping that business going. Kirk hartman, lindsey, thank you very much. We appreciate it. Were going to turn back now to Steve Liesman, who has a little more from the beige book. Some more nuggets, mr. Leaseman. Yeah, just a little bit about restaurants which was apropos about what you were talking about, saying restaurants have trouble staying open theyre having problems sourcing winterized tents and propane heating, which theres a premium on and some restaurants are closing early because of the cold, places like north dakota and, perhaps, new england, already settling in. Just very quickly, tyler and kelley, the fed governor this morning saying she was increasingly concerned about possible recessionary trends becoming entrenched in the economy for a lack of stimulus she made a very strong case today, at least in her opinion, as to why this economy for a lot of the reasons you were just talking about, why they need stimulus kelly . Yeah, we were just talking about the shortage of propane heaters as well. My family up in New Hampshire lost power because the snow was so bad no wonder theres a mad dash Steve Liesman with more beige book highlights for us lets get to the bond market where the yield is hanging above 6. 8 Rick Santelli here to talk about the moves. The beige book did not move rates much, as you look at those charts 14 basis points for twos 160 for 30s. They havent moved at all. Dollar index really under the pressure here, trading just above 92. 50. Thats really questionable considering how much rates have moved higher consider as a percentage they were at 50 basis points in 10s that not many weeks ago. To your question specifically, i hear all of this talk about when we get a vaccine, maybe middle of 2021. Call me crazy, but im an optimist and i think the Federal Reserve ought to move more into the optimistic camp as well. Because when there is a vaccine and we have all these refrigerated factories, theyre really going to push this vaccine out when they get it my guess is the economy is going to have so much extra horsepower built in, that once we start firing, the demand is going to exceed supply and things are going to get a bit wild. If youre looking to see if we ever get back to 1 on a tenyear, my guess is it will happen five minutes after that vaccine is approved. Back to you. Very, very interesting. Of course, that is what were talking about, what 2021 is going to look like when a vaccine comes and some of the pentup demand there probably is in the economy as people get back to normal and start to feel safer. Coming up, a wave of consolidation hitting Asset Management market as more and more money shifts away from mutual funds and etfs and where the bigger get bigger and the smaller fight to survive the ceo of temple ton will join us to talk about how that company is fighting to keet their edge. Plus, gm announcing its selfdriving ridesharing business is expanding, testing on the roads the ceo of cruise will join us to discuss why he thinks Autonomous Vehicle will dominate the fast lane in the next two years. More power lunch is next covid19 has crushed the ridesharing industry as people dont want to get into a connected space with strangers but gms autonomous ridesharing unit, cruise, is pushing ahead lets go to phil lebeau for the details. A little bit of news from cruise today, and it basically comes down to this they have applied to the national Highway Traffic Administration theyre basically modifying their previous application and it has to do with the origin vehicle. That vehicle is one that they debuted earlier this year. They unveiled and theyll be testing out in the San Francisco area this is it youre basically looking at what is essentially a small shuttle they applied for approval for widescale development deployment, i should say, of the cruise the whole idea is it provides autonomous ridesharing and at the same time, look at this, this is when they unveiled it back in february now were going to show you some shots of the modifications theyre making due to covid19 they are going to be implementing pandemic protections. Well, maybe a little hard to see there but were talking about a shield going between the passengers there theyll be spacing out passengers, hand sanitizer, ensuring each of the vehicles is cleaned between rides. Its all their part of saying, its safe to do ridesharing lets bring in the ceo of cruise the application youre putting into ntsa as well as the origin, it has some people saying, okay, this is a start, but im not sure ridesharing is going to come back the way it was before. Whats your outlook . Well, i think the reality, phil, is during covid, all the trouble that we have had for years in transportation of, you know, too many accidents, too much pollution, too much congestion, you know, while while during covid, a lot of things are as bad or worse the fatality rates have gone up to a 15year high over the last few months the big problem with transportation is real and we need to solve that and our solution is all electric its shared and selfdriven. Those are the ways we think we can solve these problems most directly. How do you ensure to passengers that it will be safe . I will be honest with you, when i have talked with relatives or friends and said, hey, lets take a particular rideshare, i get this, im not really sure i want to get in that car or that vehicle. How do you ensure that the origin will be safe . Well, youve seen the things that weve put into the vehicle, the partitions, passengers are completely separated from each other, upgraded ventilation so that the air is turned over in the space more rapidly people will be required to wear masks, hand sanitizer, as you mentioned. So weve been working with a harvard epidemiologist to give us really, you know, robust advice on the best way to make the origin as safe as possible these are the measures we think should not only, you know, substantively improve safety, but also give passengers peace of mind that this is really a safe environment for them to share a ride dan, its kelly here. And the aspect of this to me thats not as interesting as rideshare, its more, correct me if im wrong, that this vehicle would have no Steering Wheel and no pedal i mean, i would imagine this is the first such vehicle that would be approved to be on the roadways assure us its all ready for prime time. As you might have seen last week, we received a permit from the california dmv to begin fully driverless testing in San Francisco. And well be doing that in the coming months here you know, weve been working for years on improving our technology and getting to the point where its safe enough to begin to remove the human backup driver from our avs. And as i said, well begin that testing here in the coming months after years of hard work, things are starting to get pretty exciting in the selfdriving space. And youre seeing a number of these recent developments. We point to the fact that this really is going to be the future of trngs of transportation. Dan, have you been in contact with executives or ceos, the airlines or hotels, other industries, that are really trying to face the same problem youll face with the origin, which is convincing people, yeah, youre going to be interacting in an environment with other people, but it is safe to do so . Yeah, weve looked at a lot of different use cases and examples, phil the thing thats great about the other begin is its a vehicle thats purpose built for this kind of use case and, you know, were still obviously in the advanced stages of development with it its the perfect time for us to demonstrate the flexibility of that platform to show that we can provide shared rides in a very, very safe way. That perhaps more conventional forms of transportation dont have the flexibility to do at this point in time dan, when do we see it out on the roads . Were moving as fast as we can, phil. The other begrigin is in very a stages of development. Youll see prototypes soon. This is a driverless vehicle with no Steering Wheel and no pedals, brakes or things like that how confident are you that its actually going to work, in be one . Number two, do you have any read on whether on how frequently you have computer or other kinds of hiccups that would cause the car basically just to stop in other words, if im in a ridesharing vehicle and something goes wrong and the system goes down, im ticked off. Yeah, you most certainly are. Thats something were obviously keenly aware of. We have over 2 million miles of testing. Mostly on the streets of San Francisco. So, in a very complex urban environment. Were focused on all the aspects of the selfdriving vehicle performance. Obviously, how safely it drives is most critical how smoothly it drives how reliable and stable the system is. And when were talking about system stability, which is what youre referring to, we are autos more stable than things like your laptop or phone. We have to clearly be able to deliver. How did you know i was having trouble with my laptop and computer today dan, thank you very much we appreciate it phil lebeau, you, too. Thanks, guys, to all we appreciate it all right. Lets roll on, shall we . Here we go still ahead, bitcoin hitting its highest level since june of 2019 after paypal says its going to start supporting cryptocurrency payments how much will it move the needle for the stock . There you see paypal up almost 5 well have a top analyst weigh in. Plus, shares of chipotle heating up, jumping 60 in 2020 as it gears up for earnings after the bell the traders will tell you what to expect. Salsa . Salsa. More power lunch is next this is decision tech. Find a stock based on your interests or whats trending. Get realtime insights in your customized view of the market. Its smarter Trading Technology for smarter trading decisions. Fidelity. And sweetie can coloryou just be. Gentle with the pens. Okey. Okey. I know. Gentle. Gentle new projects means new project managers. You need to hire. I need indeed. Indeed you do. The moment you sponsor a job on indeed you get a short list of quality candidates from our resume database so you can start hiring right away. Claim your seventy five dollar credit, when you post your first job at indeed. Com home. Welcome back to power lunch. Chipotle shares not far off the record high as they gear up for earnings after the bell today. For what to watch in this report are, the trading nation team joining us todd gordon, michael from rockefeller Capital Management great to have you on chipotle had the foresight to invest in digital before the pandemic im curious with all that good news is already priced into the stock. Now up 54 yeartodate. Yeah, look, the big question is, can they sustain this massive growth they were able to pivot really rapidly when this ecommerce pandemic hit and so they were able to scale their delivery business