Lets look at that stock, nosedive here. Were deep in the red. Triple digit losses as brian mentioned on the Dow Jones Industrial average, down by 165 points. The s p 500, off the session lows by four points or two, 22 points the loss. Nasdaq feeling it down, down 1. 3 . Apple, a bright spot on the nasdaq, helping that index. Biotech down big time. It is down by 3. 5 . And, again, as we mentioned, apple is holding up. We should note too that telecom in terms of s p sectors, the only one in the green. Thank you very much, melissa. Good afternoon, everyone. Welcome. Im tyler mathisen. Here is what else is happening at this hour. The Supreme Court hearing the arguments in the long running patent dispute between apple, which had won at the lower court level and sam susung. Small Business Optimism taking a dip ahead of the election. Well have more on that in the next hour. And Tropical Storm nicole expected to strengthen over the next few days, could become a hurricane by tomorrow. Meantime, we begin with a little hurricane on wall street. Maybe just a squaw. And the important thing, tyler, is down across the board. Lets look at our sector leaders. Remember what has been up recently. Tech, energy, banks, and health care. And those are the groups that are down the most. Materials down because of that disappointing guidance from alcoa. What is moving the markets, a confluence of things moving things today. A stronger dollar near the highest level since march. Higher rates particularly the ten year. We have some weaker guidance from alcoa there that is weighing on the termaterials an industrials. And lets look at some secretariers thsecretar sectors that are down right now. There is a possibility that the house could go democratic. I think thats a small possibility, but we could see effects on pharmaceutica stocks. To the extent that clinton is in favor of more regulation of drugs, banks and oil companies, that could be an issue. Look at big pharma. Abbott, merck, Johns Johnson johnson, all down 2 to 4 . Banks, clinton in favor of more regulation of banks. See banks at 52week highs. Even yesterday, all of them down today. Finally, Energy Stocks also in favor of more regulation of that sector and you see that. Im not saying this is the primary factor that were down, but this is becoming an issue. I think the election is clearly starting to influence some sentiment on wall street. Back to you. Bob, thank you very much. Verizon communications ceo Lowell Mcadam weighing in on the Samsung Phone crisis on cnbc monday. Take a listen to what he told our Julia Boorstin. This is by far the biggest concern ive seen in cell phones during my tenure. I do expect samsung will get back on their feet. They have got a lot of high quality engineers. They got a good customer focus. This is clearly a black eye for them, though. But at the end of the day, theyll recover. How can samsung recover from this if they can . Paul argenti, professor of communications at dartmouth. But we begin with josh lipton with the latest on samsungs crisis from san francisco. Josh . Well, tyler, talked to tech analysts and they will tell you that this is simply unprecedented. Yes, Consumer Electronics companies do stuff, recalls, always have, always will. But it is very unusual for a replacement product to be just as defective as the original. Samsung has responded, the company saying for the benefit of consumer safety, we stopped sales and exchanges of the galaxy note 7 and have consequently decided to stop production. Investors are responding. Stock dropped 8 . Its worst day there since 2008. And samsungs pain could be apples gain. Drexels brian white thinks apple now has the chance to add at least 8 million incremental units this year. Some are wondering what the real cause of this samsung issue is. Remember, the initial explanation was at the note 7 problem was because of the faulty batteries but analysts say if replacement batteries had the same flaw, then that smacks of serious disorganization at the company, or the problem actually involves more than just that battery. It might not be all bad news for samsung, the team at nomura saying the negative impact will be offset in their opinion by the companys semiconductor and display divisions. They rate samsung a buy. Josh, thank you very much. How can samsung recover from this . Lets bring in paul argenti, professor at dartmouths tuck school of business. Welcome, paul. Good to have you with us. Do you think samsung can come back from this . There are examples long throughout history of companies that have recovered. Gm survived the core there. Ford survived the pinto. And there are others that have not survived. Yeah, i mean, i think there is a difference between the company and maybe the product that we need to distinguish. And thats a question that i havent really figured out yet. But, yes, of course they can survive. I think the formula for success boils down to the same things no matter what companies were talking about. Admit you made a mistake, tell us what that mistake is, if you know what the mistake is, tell us, you know, why it happened, how it happened and tell us how the future is going to be different. The problem here is that engineers and particularly korean engineers want to be very sure before they answer questions like that. And korea is a high context culture. They like to know the answers and take their time and were not used to that in our culture. I think those two things are colliding right now. Theyre taking their time to figure out what is wrong and were trying to figure out, give us an answer as quickly as you can. Consumer Products Company would do that, apple would do that. Samsung is not going to do that. Thats because theyre built differently effectively. I think they are. I think, you know, what a high context culture means is that people want to understand what the problem is, they have an implicit communications style, theyre different in the way they approach things and in some sense it is a better approach, just not what were used to in the west. In korea, this would be a no brainer the way theyre handling it would be well thought out. Samsung is a company with a lot of moving parts. Im not worried about the company surviving, but the product is another story. Thats the real question. Can this product survive, the answer is probably no. Can another product from this company make it . The answer is yes. How long is the consumer memory . Well, in the United States, consumers have pretty weak memories, i would say. Doesnt take much to turn things around, gm, wendys, a whole host of companies, or chipotle. You can turn it around fairly quickly and the thing is, you know, get this product out of the hands of consumers as quickly as you can, give them something else, very fast, and then come out with a killer product that doesnt burn up in airplanes and in your car and i think that will probably be good. Sometime in the 6 to 12 month range is my guess. Is that the missing piece . What struck me about the samsung response, well replace your phone and eventually we will, you know, well halt production. But there wasnt any monetary, you know, effort to reimburse consumers for the inconvenience of not having a phone for a while. Even tmobile issued a 25 credit for Samsung Galaxy note 7, but you didnt hear anything like that from samsung. I think thats a big problem. Compared to audi, for instance, i have a tdi myself, and im getting something from a company which is certainly better than what most companies would do, and i think it makes you want to buy the next product or hold the next product. Them just saying well give you another phone, i would rather have another phone i know isnt going to explode. So that is a problem. But, again, i think it is part of the culture, the other phones are fine. Why should we give you money too . Were going to give you a perfectly working phone. The logic makes sense but theyre not getting the au inti emotional part of this. This note 7 is clearly to the, literally and figuratively. But you burnt toast. And i own a Samsung Phone, which ive been im telling you, it does get warm for when im running video on it. It gets hot. It makes me wonder your phone calls, no doubt. My phone calls are hot. You know, it makes me wonder whether people will accept other phones from samsung or whether this is just a huge opportunity for the htcs, the lgs, motorola is basically out of it, but apple. So it is an opportunity for them in the short run. But, you know, the brand of samsung overall, i actually just saw a study last week from the Reputation Institute about the Samsung Brand and its reputation, how strong it is. And the underlying factors that make this company a great company. In some ways stronger than apple because of the number of moving parts. I would say kill the product, disappear for a while, come back with something else, maybe with a different brand name, this company would come back and americans have short memories and long interest in good products. You give them a good product, theyll take it, thats my guess. I think you ask people what the best Television Set in the world is. I bet you a large amount would say samsung. I have one. And i wouldnt buy anything else right now, so for sure, yeah. All right. I wonder how many people paul, thank you very much. I wonder how many people are so trapped, though in the ecosystem of android that it is not going to be an apple benefit, it will be probably be a google pixel benefit. Or lg or theyll stay with android because all their apps and everything they may have purchased, may not be the hardware samsung. Josh mentioned that brian white at drexel estimated 8 million benefit to apple. I wonder what percentage of the total recalled units that would represent, what assumptions there are in terms of how many people actually make that switch as opposed to as you say switch to another android provider. We know it is uncomfortably hot in tylers pocket. It is. Not right now. Dont put it in your pocket is what i would say. Im a dual threat kind of guy. Iphones and youre a modern day gunslinger wyatt earp android on one hand, iphone on the other. It has been a different picture for apple. While samsung was dealing with visuals of exploding batteries and jeeps on fire, apple debuted the beautiful pictures taken with the iphone 7 of nfl Opening Weekend and since that weekend, visual of the two stocks couldnt be more different either. Apple stock up 13 since then and is that a year to date high . It is a bright spot here on the nasdaq 100. News flash, jeff bezos is building an empire. Amazons latest venture is coming to a neighborhood near you. Where wont the retail giant go . That is still ahead. First, a new report out taking a closer look at the candidates tax plans. We have that one coming up. Ake. With directv and at t, watch all your live channels, on your devices, datafree switch to directv and lock in your price for 2 years, offer starting at 50 a month. [phone buzzing] some things are simply impossible to ignore. The strikingly designed lexus nx turbo and hybrid. The suv that dares to go beyond utility. This is the pursuit of perfection. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. Im in vests and as a vested investor in vests i invest with e trade, where investors can investigate and invest in vests. Or not in vests. Sign up at etrade. Com and get up to six hundred dollars. When legalizing safe, responsible adult use of marijuana, the most important question is how . By voting yes on prop 64 adults 21 and over could only purchase marijuana at licensed marijuana businesses. And prop 64 bans advertising directed at kids. Requires strict product labeling. Childproof packaging. And bans edibles that appeal to children. Smart provisions to safeguard our families. Learn more about the safeguards at yeson64. Org. Welcome back. A new report out taking a closer look at the candidates tax plans. Steve liesman is here with the details. Steve . Everybody is talking about the tax plans out there. Tax policy Center Joint Venture of the urban institute and brookings out there with a new report and other things when it comes to the effects of both clinton and the trump tax plans. And theyre being described as mirror images. Graphic created by our graphics department. They are indeed about the only thing the same is theyre both smiling on both sides. But now take a look. According to the clinton would decrease the deficit by 1. 6 trillion over ten years. Trumps plan would increase it by 6. 2 trillion. Clinton would soak the rich, big taxes on the highest income americans. And put higher taxes on capital. They estimate they havent done an estimate of growth yet. They had problem with the software on that. Shortterm negative for clinton and longer term, neutral to slightly positive. Trump would increase deficit by 6. 2 trillion, coddle the rich, opposite of soak the rich, slash the taxes on capital, bringing the tax rate down to 15 on many corporations out there. Growth seen as shortterm positive, but perhaps longterm negative because of the effect of the deficit spending. The idea in the press conference with reporters, the analysts are skeptical that trump can cut Government Spending as much, since hes taken military and entitlements off the table. And just real quick, we can put it into peoples pocketbooks. Here is the effects, folks, on the quinntile. This is the clinton plan. You can see would go up for everybody but the top. When it comes to the top, their incomes would decline by double digits. Here is the trump one. Notice all the quinntiles do a little better under trump than clinton and except for when you get to the top there, the top does much better, 6. 6 and they would see also double digit increases in their after tax income because of the way things go across there. Thats the analysis and we have a story online and that will send you to the link. So you folks at home can find out exactly what it means for your budget. The point of yesterdays exercise in digging into who the top taxpayers were was not to say the plans wont work. I have no idea. It is just that we hear a lot of, well, were going to do this and charge the 1 . Were going to do that and were going to charge the 1 . As we pointed out yesterday, 80 of the rich make under 500. So those are working wealthy. Theyre well off, but theyre not bill gates. I wonder if there is enough money to take from the group that would fund some of these things. I dont know. Well, i mean, thats it is a relative if you dig into the bigger question is the effects on growth. They say there would be increased labor productivity, perhaps increased hiring, but we dont know what the effects would be on the deficit and then you have higher Interest Rates potentially. So there is this offset in there. Why under the trump plan do incomes at all different quinntiles of the income go up as much as they do . Is it because theyre the rate, the marginal rates are lower . Goes down for everybody. Three brackets, there is what hes doing with exemptions and deductions. And a variety of very complicated tax things that are going on. I should point out the estimate is that clintons tax plan would dramatically increase complexity of the tax system. Trumps would make it much less complex on most levels. But, yeah, trump would lower taxes across the board for everybody. Rates. Rates across the board for everybody. Clinton would lower them for most, but not the top i want to jump in with the market alert. The dow is down 200 points. Were just off the session lows now. But we did notice this slight leg lower in the past 15 minutes or so. S p is down by 1. 25 . Were seeing the weakness, financials, just dropped by. 2 . Technology is weak. Semis are particularly weak and health care kin continues their slide today. Biotech the culprit within health care that is hurting that sector. All right. Steve, stick around. Were now just 16 trading days away from the big event. No, not the election. It is the fed decision. It is 22 real days away. 16 trading days away. Were talking about the next fed decision and not to take anything away from the drama, but has the market already done the feds work and shifted as if a rate hike has happened . Consider this. Bond yields higher across the board. The dollar stronger. Gold tanking. And financial stocks largely outperforming. Something that we said would happen when the fed raises rates. Lets bring in joe lavorna, joe, you know, again, not to take anything away from our coverage, a big day, but is the market saying a rate hike is coming and we are moving regardless . I calculated the probability of a november 2nd hike at 10 . However, if you go out to the december meetings, which is when i believe the fed will move, it has been my view since the beginning of the year, the probability is closer to 70. Yes, the market has priced in one hike or moat of ost of one yes. I agree with that. I wonder, if youre the market and youre seeing a 60 or 70 chance of a rate hike, you know, theyre not going to wait, are they, until the fed does it. Theyre going to move ahead of it. They are. And thats why the front end, the twoyear note has moved up so much since the beginning of the year. But, brian, to me, what is happening in equity markets and more broadly speaking Financial Markets is a real concern that growth is unlikely to meaningfully recover. Ill give you the for instance. The atlanta fed last month, i should say in august, thought gdp for the Third Quarter would be 38. My view 13. They have come down to 21. What is happening in markets is there is a reflection there is not much confidence left in the Central Banks. Thats an indictment of the fed, but also Central Banks globally. You pair that with what the stock market is telling us in terms of the data points we have gotten recently. We had the honeywell warning, we had alcoa coming out saying that growth in china hasnt really materialized yet. We have got a dollar that is actually strengthened significantly in the past month, 2. 4 . You enter earnings there is no doubt it is baked in. Be a little careful because you dont know exactly why people are positioned once the news event happened. You can have an outsider reaction. I think thats the feds goal, to go with maximum flexibility