Lots to talk about this morning, once again we follow the bouncing ball of the china story and overnight we are learning that both sides said they would be willing to roll back tariffs, interesting. Devil is in the details, this can be very good, imagine how much markets might soar if you, in fact, do get this first round deal with china, very good news for investors. Maria we have a rally underway right now, futures indicating doubledigit gain, on top of all 3 major averages closing in record territory yesterday over optimism in deal with china, u. S. And china, s p was up 11 and nasdaq up 46, washington and beijing considering rolling back tariffs of completing phase 1 of much larger agreement, President Trump spoke about that in rally last night, listen to this. China is doing poorly as you know, but they are paying billions and billions of dollars and theyve never given us 10 cents before, billions of dollars, they gave a lot of the money to our farmers who got targeted but no longer, they are back buying from our farmers, they want to make a deal so badly, frankly, honesty, they want to make a deal a lot more than i want to make a deal, thats the way it is, we are doing very well with china. Maria we will see where this goes now. Dagen the Financial Times was reporting earlier that the administration was looking tat tariffs of 15 , 111 billion in chinese import slapped on starting september the first, retailers, apparel producers push back on those and the journal follows up and says those are the tariffs, the levies that officials are considering rolling back, but, again, its a sign of good faith and we are better than the rest of the world if you look at global stock markets, s p 500 year to date is up 23 that beats europe, china and the emerging markets, only up 10 , doubledigit gain nonetheless, every single sector of the s p is up year to date and its those highgrowth some say expensive sectors that have done well. Maria all we heard the recession is coming, the recession is coming. No recession, kind of silly when they were saying that the inversion curve was going to lead to some kind absurd. There is because theres slowdown in the world in general, the United States keeps rolling along with Consumer Spending high. Interesting to see trump is always negotiating for america no matter what hes doing and no matter where he is, even if hes talking to people in kentucky, hes talking to xi jinping in china, always negotiating the deal. Maria he really is, youre right. Dagen i would push back on the inversion of the yield curve, historically been a sign that recession was on the horizon, what the Federal Reserve did, looked at it maybe with push from the president and said we need to get shortterm rates below longerterm rates because banks cant make money lend if you have the inversion and thats exactly what happened, the fed has cut again last week and you finally have a field curve thats flat, certainly not upside down anymore. You always have to ask why is the yield curve inverting, we had demand at the top, so it took many out of the market which drove Interest Rates down on the 10year and then you had the government trying to finance itself with 2 , im sorry, the 2year, but with the low end, so you have other factors driving that yield curve and so it wasnt the the economy continued to do very, very well other than as you say Manufacturing Business investment isnt where we would like to see it because the fed took a lot of the enthusiasm out of the market. Maria look at the jobs numbers on friday. So good. Maria gm strike, the boeing situation, the number better than expected. You talk about where is the recession we were talking about, its not here, china to the president s point in the speech is really struggling, so he has rated much more leverage than anybody expected in terms of being able to go back to china and say we need you to make some real fixes on the issues we care about. Maria unbelievable while the democrats are knee bent on china, get him out of office, he keeps going and going and i think and rallying, look at him last night in kentucky, the president in the bluegrass state ahead of tonights governtorial election. 158 million americans now employed, the highest level of employment in our countrys history. Under my administration weve added nearly 10,000 new factories and many, many more thousands of factories are coming into our country. We slashed the Record Number of of jobkilling regulations, we ended the war on american energy, we are now the largest producer of energy anywhere in the world by far. Dagen stark contrast, whoever is the nominee and the president because its not just about the millions of jobs, its not just about keeping Energy Prices low, its about our security as a nation and our ability to dominate and be the worlds number one producer and take power from those nation that is hate us, take power away from russia, we can go to the middle east and take hard stance because we are no longer at the mercy with iran that despise us and want to wipe us off the map. I get so excited and i think ive talked about this for 20 years and finally we will see it happen. Maria california pushes back and pushing back and look what it has done to grow and things that people care about in their lives, okay, meanwhile uber, thirdquarter miss, thirdquarterly lose despite increase in revenue. Uber ceo giving timeline in profitability, in 2021. Company cut Sales Forecast sending stock lower, 17 , andy, whats your take on this given the space, the burger space has expanded competition. In and out has the same thing out west. Maria are you . People are saying, look, you them in st. Louis, everywhere across the country, maybe they are becoming more like a chain that could be impacting sales, we were talking a bit off camera, they are trying to do a deal with one delivery service, you have at least two. The more you have, the better you will do with delivery. Look, this is an industry that will continue to do well, shake shack has to change image a little bit. Maria booming situation, unemployment at 50year low and you see a restaurant like shake shack down 17 and weaker than expected earnings. I think it has more to do than the competition in the space. Maria shake shack problem . Exactly. An individual firm struggling with samestore sales may have nothing to say about the broader space which is just thriving with all the new options consumers have. Dagen its like popeyes, shake shack, am i going to stand in the line or get the delicious sandwich . Maria the lines are around the block actually, one situation turned fatal with the chicken sandwich which is just incredible and there was mcdonalds as well, what was your take on the mcdonalds story, ceo out, new information the hr person is also out . Yeah, i think that wont affect their sales, i dont think that will affect stock price, mcdonalds always promote from within and they have a whole raft of people, they have a good maria we will talk more about mcdonalds, so widely held, i have to get your take on whats going on in mcdonalds, on deck fox news senior strategic analyst and retired four star general jack keane on iran stepping up its uranium enrichment, former Arkansas Governor Mike Huckabee is here on latest impeachment news and former defense and economic under Angela Merkel joining us, first ecb speech, a lot to talk with europe, in europe, stay with us for all of that short break, when we come back, more changes at the top in mcdonalds, another executive is out on the heels of ceo being fired, details next, the stock is up half a percent, party at the white house, Washington Nationals meeting with President Trump days after historic world series win, new ask maria segment, ask me on instagram, twitter, my answer is coming every friday right here on mornings with maria, back in a minute. 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Its not insulin. I take it once a week. It starts acting in my body from the first dose. Trulicity isnt for people with type 1 diabetes or diabetic ketoacidosis. Dont take trulicity if youre allergic to it, you or your family have medullary thyroid cancer, or have multiple endocrine neoplasia syndrome type 2. Stop trulicity and call your doctor right away if you have an allergic reaction, a lump or swelling in your neck, or severe stomach pain. Serious side effects may include pancreatitis. Taking trulicity with a sulfonylurea or insulin increases low blood sugar risk. Side effects include nausea, diarrhea, vomiting, belly pain, and decreased appetite, which lead to dehydration and may worsen kidney problems. I have it within me to lower my a1c. Ask your doctor about trulicity. Maria welcome back, the president of china expressing support for hong kongs leader, Lauren Simonetti with details in headlines. Lauren xi jinping speaking at trade event in shanghai event today and backed up lams effort to end violence that rocked the city, the support comes amid concerns that beijing was about to replace lam who faced criticism over extradition bill, the bill has been withdrawn, another highlevel departure at mcdonalds, Steve Easterbrook was fired for having relationship with employee. Easterbrook will get 600,000 of severance pay, Pay Attention to mcdonalds stock today. You saw him wearing a different baseball cap during the teams visit, theres the maga hat, first title in franchise history calling it a comeback story for the ages. Did you guys see this . A black cat still on the loose in Metlife Stadium in new jersey, ran on to the field last night and caused 2minute delay during the giantscowboys game, the cat disappeared in the seats, the giants say once located it will be taken to veterinarian to be examined and black cats bring bad luck for the giants, it was a lot of fun. Maria its the cats fault . Lauren i dont know, maybe. [laughter] dagen he got to canceled on twitter he made his twitter account private. He had to protect his tweets. Maria really, there should be a law against that. How is it shaming constantly going on, i mean, its wrong. He cant put a make America Great hat . At celebratory event with the president , i dont see why people cant look at that and say, i get it, i understand what hes doing here, im not going to cancel. Maria so what . He can have his own opinion. Dagen the hat hurts my feelings. [laughter] maria back to mcdonalds, you know, lauren is just reporting, it was a consensual relationship, hes divorced, he wasnt cheating, the hr person probably said its okay, nothing is wrong here, right . Hr person is a friend of his and probably advised him that this wasnt something that needed to be concerned about, obviously the board of directors felt that the ceo having a relationship with the too bad he had to resign, i dont think it benefit it is company, like i said, they have a strong bench and fill his spot. Dagen if youre a ceo everyone is a subordinate. Maria hasnt he done such a great job at mcdonalds . Its inappropriate to have a relationship with subordinate. He is divorced. Maybe current political climate, maybe they felt they couldnt get away with slamming him on the wrist, i disagree. Maria market value as well. Not smart. Maria take a break, easing the chaos, Los Angeles International airport, lax ready to make it easier for passengers to catch a ride, earning season rolling on, pharmaceuticals among big gains reporting today, full analysis of thirdquarter reporting season when we come back. 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Maria welcome back, good rally underway this morning, take a look at futures, indicating gain 72 points, dow futures up 70, nasdaq futures up 23, this is all gravy because this is record territory yesterday all the major indices hit record high amid a better than expected Third Quarter earning season, earnings driving the story for the most part, cut in Interest Rates as you know and great jobs numbers on friday, we are waiting results this morning from pelaton, we will get the numbers as soon as they hit the tape. Chief investment capital. You were somewhat cautious when we saw you. 6 months ago, heart in trade war and obviously things were escalating, you saw cap x drop and we said recession was extremely low, classic setup last year as we were talking about good Economic Growth and the fed was sucking out of liquidity markets and earnings and multiple compression, this year you have the exact opposite, Economic Growth slow, fundamentals be weak but because the fed cut rates 3 times, you see massive inflation of assets including equity. To put it in perspective, december 24th, 13. 6 multiple, roughly 17 and a half based on 11 earning growth next year, certainly a year for the ages, a lot of upside in all assets, the biggest issues for investors, look, the fed policy shift has worked too well, everything is expensive again. Many assets were cheap, 10year on 1. 8, fixed income is expensive, highyear bonds only 3 loss suggested yield and equities 17 and a half times earnings, a mature adults looks at that and says we want to be looking forward. Maria they make it more expensive. Thats what they are doing. Does the fed right now, the fed bungled things so badly, do you think they are in a place that supports Economic Growth and supports the market appropriately . So, if you think of the fed, the fed is looking at much slower growth, they want to make sure that Financial Condition tightening does not exacerbate that, given the backdrop they are in a much better, they are not sucking liquidity and dollars out of the system and fed fund rate thats supportive. We think the pivot has been successful and from here they will be very data dependent. Maria let me ask you about the hedge funds, whats going on with the active management space out there because yesterday we learned that elliot has raised 2 billion for buyouts, theyve got 4 billion in hedge fund push, elliot taken out big stakes in a number of companies, the firm announced plans to raise for hem funds and raising 2 billion just for buyouts . Yeah, look, i think in general its been a tough period for active management and equity part of the capital structure and for hedge fund its been no different. Most of the opportunities for ourselves and folks like elliot are really focused on now are more tied to Consumer Credit or other alternative credit sources, elliot does have the ability to go after companies more specifically in one of successful activists over time, unfortunately most activists several years ago stumbled because of overfocus on value and certainly thats one of the alpha drivers for the bigger firms to take large positions and hopefully not have pg e and outcomes. Maria their most recent, they have 6. 7 stake in public group of companies and agencies, is there a theme that you think is going the take place in terms of takeovers, is there a sector that is more poised than others in terms of consolidation . The one that we have been focused on particularly since regulation was roland back from executive branch further consolidation in the banking industry, if you think of where the caps, basically 750 billion, so what you have seen slowsteady progress, banks are still very cautious. Unlikely we so a big boom, but something that we are waiting maria you are talking about the smaller banks. Community and regional banks. Maria okay. Dagen speaking of hedge funds can i give my friend greg zuckermann a shoutout, quite known writer at the wall street journal, he has a book out a man who solved the market and jim siommons who sold renaissance, i tried to buy it, one of the most fascinating stories, but jim simmons. Has done a great job. Dagen have you read it yet . I have not, success for if you look at renaissance and other firms, its very hard to continue to update models and not data fit. Maria yeah. So data fitting is when you add too many variables to your models and data and you get blasted, so one of the things that they have done successfully evolved their variables and we all know that markets evolved but doing in a way to avoid data fitting, it sounds simple but very, very hard. Maria doesnt sound all that simple, by the way. [laughter] dagen jeff bezos went before he started the Little Company called am done. Maria he started with books, goldman sachs, wealthiest clients to invest in the u. S. As opposed to the rest of the world, goldman telling on u. S. Equities. We 100 agree with that. Unfortunately europe is stuck that they have been since euro zone crisis, they did have good growth since 2017 and since th