Transcripts For CNBC Closing Bell 20240712

And tech is staging a comeback, or at least it was, after yesterdays big losses well off the highs. Another brutal day of nikola the first sell rating on wall street and colorados governor warning of a potential wave of Coronavirus Infections the governor will join us with the new measures he is taking to try to stop the spread first up, lets focus on the big stories were watching one hour left of trade we have the latest on the stimulus stalemate in washington a half hearted bounce this morning. It seems like the dip buyers they keep drawing new lines in the sand as they back up and this morning the s p 500 futures got down to 3200 almost right to the tick we did bounce off there and then we have the post 2 00 p. M. Eastern time selling again a little Risk Reduction where people are not quite sure if if the footing is there for a strong close this down trend developed here were going back gagain to the june 8th high. Were turning around i point to the late july area. A lot of the levels that people are saying okay maybe that is enough maybe thats enough. Certainly getting oversold on some measures. So it is certainly some of the things are lining into place in terms of number of stocks that are below the averages and some sentiment stuff is getting a little more fearful. Maybe not an outright fat pitch. The take a look at Corporate Bonds. Maybe worth watching as well to see if this is spreading not a lot to see here. This is the lqd, Investment Grade Corporate Bond etf you do see it sort of sagging a little bit here. Treasury yields are doing almost nothing now. The price of the bond is showing you risk appetite. Were absorbing credit supply. The so far okay. Keep an eye. There are levels here that 134 say may have significance if we get below that finally, real Interest Rates we pointed out this chart. This means when youre below zero you have negative real rates. So this is the fiveyear you see this very subtle bottoming process. That was right at august 31st. Really started to go up. Inflation expectations started to go down doesnt mean the market doubts the feds ability to get inflation without fiscal stimulus Something Like that may happen h so it is one of the inputs that maybe is reducing an appetite to pay up for some stocks out there. I would point out we have been negative and gone into positive territory before it is not been the end of a bull market 2011 to 13 is one area. Right now, sometimes the market fixates on one variable. This has been one of those right now. I want to ask about the other variables and whether the story changed at all we got initial jobless claims. They continue to sort of move in the right direction but remain stubbornly high. Well get jobs next week housing numbers still continue to look good has there been a rethink of the economic narrative i dont know if there is a rethink. Housing and manufacturing on the strongside the very much looks like, you know, you have some cyclical force thats are working in your favor there. Labor market stuff, consumer bases, real time mobility. I dont think it really caused people to say the economy is taking the lower leg lower does it create wear and tear on sentiment toward economic recovery and creates that appetite for some kind of fiscal rescue i guess the positive over the last couple of hours in u. S. Markets perhaps was the surprise then i wouldnt say it should be surprised. This kind of erratic action, its incredibly tactically focused. Its mostly about positioning where people feel trapped. Where they feel like its worth trying seasonally again, its tough that starts to turn into your favor going into next week mike, thank you very much for that were getting details on a stimulus proposal from democrats. We have the latest from us House Democrats are putting together a new scaled down stimulus package that they could be ready to vote on by next week thats according to four sources. House Speaker Nancy Pelosi has directed her Committee Chairman to start working on the details of the bill and im told that pricetag could approximately 2. 4 trillion. Now that would put it out of range for both of the white house and the senate republicans. But still, earlier today, both pelosi and Stephen Mnuchin said they would talk about another aid package. And Jerome Powell testifying before the Senate Banking Committee Urged congress to act. The recovery we had had so far owes a significant degree to the cares act and the support that congress and provided in conjunction with the administration guys, no word yet on whether any formal meeting has been scheduled between mnuchin and pelosi back to you. I guess not just the pricetag that might end up being a roadblock to this. Lots of other factors at play including, of course, the likely announcement of a Supreme Court nominee by the president this weekend. What chance dozen we put on this stimulus bill in the short term . Well, i think democrats are not necessarily expecting republicans to go along. I this i what youre seeing here, too, is a lot of politics at play. Theyre within the own party to have another alternative to the heroes act they put forward back in the spring and to show voters theyre working on something and have something to actually campaign on does this get us closer to a deal i think that depends on when we see pelosi and mnuchin sit down together obviously important. Thank you. After the break, nikola in free fall its down 07 from the highs just got first sell rating on wall street amid a heated short seller battle. Well talk to the analyst behind that call next thats what my dad does. Good job, michael ok, lindsey now tell the class what your mommy does. My mom has super powers. Its like she can see the future. What . its like she time travels in a rocket ship. Thats cool and then she comes back saying try this or try that. She helps everyone. She helps them feel less worried. Wow mommy, so what is it that you do . Im a financial advisor. She is aig proudly supports all the professionals taking care of our financial futures. I keep working my way back to you, babe with a burning love inside yeah im working my way back to you, babe and the happiness that died i let it get away servicenow. The smarter way to workflow. To deliver your packages. And the peace of mind of knowing that important things like your prescriptions, and ballots, are on their way. Every day, all across america, well keep delivering for you. Welcome back we have a news alert on Facebook Julia has the story. Thats right, wilf. Facebook dismantled three networks of fake accounts which could be used by russias Intelligence Service to leak hacked documents that was in it an effort to disrupt the upcoming election. Facebook saying in a block post, the people behind this activity coordinated with one another and used fake accounts as a central part of the operations to mislead people about who they are and what theyre doing and that was a basis for our action. Though had coordinated inauthentic behavior that they detected and removed russia which was tied to this one denied election meddling facebook did call out russia in this instance. Back to you. Its been painful week for investors and electric vehicle stocks with tesla, nikola and neo down sharply today another name said it would go public. There was a deal and tesla turned around here and is now higher on the day. Phil has the details phil sar yashgs t. Sara, are it is charge point. If you wonder who is charge point and have i seen them before look, if you go to a walgreens, target, really scores of different Public Companies around the country and youre in the parking lot and you see the charging stations, then, yes, you have seen charge points. They sell subscription models for those that are tied to the recharging machines. The value of this ipo, 2. 4 billion it will be a half billion essentially that is going to be going in proceeds to charge point. It is expected to close by the end of this year the ipos this is the sixth one that weve been able to document they raised 4. 5 million those are proceeds that have gone to the companies. None of the companies are profitable yet when we talk with charge point ceo, he says, yeah, but were a little different were very different. St this is an established company. Its had a ten year track record of shipping product supporting customers. We are in revenue. We do not have the risks of a prerevenue company nonetheless, it will be interesting to see what happens when this deal closes and you start to see charge point trade publicly if you look at the ev related stocks over the last month, there is not much to write home about. A big difference from july and august when you saw a lot of people pushing money into ev related stocks phil, as always, thank you so much sticking with the ev space, webbush securities downgrading nikola to underperform from neutral and lowering the price target from 45 to 15 first sell rating on the street. Lets bring in the analyst dan, good to see you why the downgrade . I think with trevor leaving and our analysis of the situation, i mean, to me there is a lot more risk than benefit here in terms of the stock and i think its going to be a very turbulent ride over the coming months. It has a lot of execution risk for us were a hold rating it is binary were bullish or otherwise we see this stock going much lower. What was revealed in the report that you werent aware of that you wish you had been aware of what points did they make really hit home and you felt i should have been aware of those points already . Obviously, anyone going through that, any investor, there is a lot more, you know, questions than answers and i think right now it continues to be a black cloud over the stock until those are answers. And our issue is that for a company that needs to execute a vision on the Hydrogen Fuel cell side in a very competitive market obviously gm was a feather in the cap. But Going Forward with trevor no long we are the company, this is going to be her ca huge climb our price target is in the middle but if another shoe drops, stocks go lower. We dont want to be there looking at investors in the eye. Right now i view this as a stock going lower. Youre the first sell side analyst to downgrade the stock youre not early on this call. Where were you, what, 70, 80 ago . Could have saved investors a lot money. We initiated a month ago. It was sort in of the middle and the stock already have a huge run. When i look back the last few weeks, for us it was like hindsight is 2020. I look at it, combined with what we saw from tesla with having battery costs and making the price parody issue here, that much more of a question, i think there is a lot more that could go wrong than right. As i covered tech stocks, i just got a call, i can do the analysis we did the analysis. And to us, its not a yellow light. Its a red light so sorry to labor the point, dan. The sort of accusations, the most serious accusations when the word fraud gets brought up, fake and so on, do you go that far . Or if you did, youd have a sell rating. But you dont. You still think there is a decent amount of value there just another 10 lower or so dan . Ee yeah. Were still 15 and still see significant down side. But i think thats what needs to come out i mean, these questions need to get answered for investors to get more bullish on it and to have more, you know, ultimately confidence and vision. Otherwise, it is just dark days ahead here as they try to execute on the vision even though i still do believe gm stays with the story so in this call, dan, this underperform on nikola, is it a bullish view or reaffirmation of the bullish view on tesla . It is that continues to support of be the view here. If you look at tesla, forget knee jerk reaction battery day. I mean them having call some batteries. They could do a million delivery units. Youll have a lot of dmpz going after the ev market. Tesla sour way to play the ev space. You know, we look at others going after them, even as we see with nikola, there is a lot of turbulence as you try to execute on the vision. Dan, thank you for joining us. Thank you weve got 42 minutes left of the session. We have been slipping over the last hour or so. Little mini bounce takes us back 0. 3 on the dow. After the break, nat onboard, kanye west says he wont release any products with gap until he is given a seat on the companys board of directors llt xtntl uss the poteia faoune kanye west taking a stand on twitter against gap and adidas calling for board representation tweeting im not releasing nothing on gap until im on the board. And on adidas, im wearing jordans until im on the board of adetroidas earlier he tweeted blackboard seats matter calling for more diversity at the top both gap and adidas benefited tremendously from kanyes clout. Gap up 60 since the partnership was announced in june. Were waiting that line next year adidas is up 350 since his first launch back in february 2015 we talked about the boom this had in ferterms of sales both companies unsurprise willingly had no comment for me. Up with thing we were trying to figure out with gap is whether he is contract youll aly bound to get the line released next year its not clear but we do know the companies have a lot to lose, not keeping him happy. I dont know how theyre going to handle the board question the flip side is if hes in breach but to specifically for the example to say hes wearing nike sneakers in in the meantime, i am am no expert on this i imagine he is in breeach of the deal in the first place no. I dont think so hes creative hes allowed to wear nike. This isnt like on the courts. He has a whole line that he has a profit share with adidas im not aware of anything in terms of a sponsor deal. That has nothing to do with him not releasing the line to gap next year. Maybe hes making a statement and none of this he intends to followthrough it is something investors Pay Attention. To gap is down 4 premarket when he put o thought tweet but as you said, listen, the share price breach since he joined has been huge with adidas, there are other factors at play. Its been a longer period of time but with the gap one, its clear this is the driving factor of that what you said is 65 or so increase which is i would argue it is a driving factor they were struggling both the stocks down 1. 3 today. In other retail news, the Holiday Shopping season is right around the corner. The massive uptick in ecommerce this year could present a headache for shippers in december we have that story now hi, frank. Good afternoon. 700 million Holiday Gifts around the world are at risk of not arriving on time the logistic strain showing at the port of l. A. They were higher year over year in july and august businesses at inventory for the holidays ups, fedex and the post office already seeing holiday level volumes in august. Anything above 98 on time delivery, thats great anything below 95 , well, thats when complaints start coming in and a further strain on the capacity amazon, for example, has been experiencing on time issues for months from april to mid september this year, only 70 of prime deliveries were made within two days last year over that same period of time, the number was 95 . Big difference there year to date, an average of 78 million packages are sent every day. That is expected to surge to 122 million and thats not counting returns. Back to you. Its going to be so heavy this year. Thank you. Frank, thank you thank you still ahead, key read on the con sumdz consumers after the bell well preview what to expect next and break down the numbers as soon as they hit the tape as we head to break, heres a check on bonds for you yields are moving a bit lower today. Thats why were seeing streng njt bond proxies like utilities, Consumer Staples, those are the top of the s p 500 the ten year note yield, down to. 66 havent seen a ton of movement given the wild swings in stocks. Theres a bid today. Well be right back. Welcome back time for our daily coronavirus tracker. Were starting to see hospitalization rates tick up in some states. Today in the u. S. , there are ten states reporting a more than 10 increase in hospitalizations week over week south dakota, maine, and New Hampshire seeing the largest increases. Cases continue to rise across the atlantic as well both the uk and france recorded highest ever increases in daily cases today. Meantime, United Airlines is offering preflight covid19 tests to travelers to hawaii beginning october 15th it will be offered in San Francisco to begin with. But united plans to eventually expand that program further still. Senator Elizabeth Warren calling for the firing of operation warp speed leader over perceived conflicts related to his stock holding. The first person to be fired should be the doctor the American People deserve to know that covid19 vaccine decisions are based on science and not on personal greed. Responding to warren in a vud yoe shared with our meg terrell. She joins us with the details. This has been an issue that has been going on for a while. Why did it get reignited to day . Senator warren making the comments in a hearing yesterday. Going further than she had before calling for his firing if he doesnt disclose all of his what she calls conflicts and divest of them he spent 30 years in glaxosmithkline and also in manufacturing modernas covid19 vaccine. Here is how he responded in this video. I do not hold shares in them n contrast to what you have said i have never had any shares in them i explain our shares in gsk. I earned over 30 years and our retirement i will give research every penny in value acrude during my role here i didnt hesitate to join the role even though i am am registered democrat. This pandemic is bigger than any one of us. Bigger than me and bigger than you. Please, get the facts right. And please stop distracting me guys, he is telling me he holds about 15 million worth of glaxosmithkline stock which he does not buy or sell he also holds shares in a company where he is chairman back to you. Meg, so i dont know. Sst that a legitimate excuse that he held it for a long time . He doesnt sell it it is part of the retirement when that is, i believe, one of the companies that stands to benefit from operation warp speed . Yeah. Glaxosmithkline along with santa fee, they partnered together and they have government funding from operation warp speed to accelerate the covid19 Vaccine Development efforts. He says that any increase in the value of that stock he will will donate to research but, of course, he is a contractor to the government so critics focus on the fact that he doesnt have the same perhaps disclosure or ownership rules as employees of the government might have. The doctor says he worked with health and Human Services legal team to take care of all of those issues the but of course this continues to be a focal point. Where do they disclose the holdings they came up as soon as he was named director or the chief adviser to operation warp speed back in may. He told h. Sosold the moderna sd donated the money to charity the holdings have been reported at 10 million he told me it was 15 million. These are available in filings but, you know, they continue to be of focus. And the stock ownership, you know, was not verified necessarily by senator warren yesterday. The doctor saying she was mistaken great stuff, meg. Thanks so much for that. And for getting that report as well important to hear that powerful response. Sue herrera the powerful head of the vaticans saint making office resigned the cardinal has stepped down amid a financial scandal that has reportedly implicated indirectly he denied all wrongdoing back here the ahome, in michigan, early voting has started in that battleground state. 2020 is the first president ial election in which michigan voters can obtain a no excuse absentee ballot. Trick or treating may not happen for many this year. Americans are still buying a whole lot of candy whul they wait to find out sales of halloween candy were up 13 in august. Of course, the main sales time is still ahead more than half of the halloween candy sales happen in the last two weeks of october berkeley, california, meanwhile, has become the first city in the u. S. To ban candy and other sugary and salty treats from Grocery Store checkout aisles. They affect chips and beverages and even those with artificial sweet eners. Back to you. Thank you so much weve got 27 minutes left. Although we jumped to be back up 0. 3 ten minutes ago, were back down again were currently down for all three of the major averages after the break, election protection. Well discuss what a contested election outcome could mean for your money and how to protect your portfolio into year end first up is this exquisite bowl of french onion dip. Im going to start the bidding at 5. Thank you, sir. Looking for 6. 6 over there do i hear 7 . 7 in the front 7 going once. Going twice. Sold to the onion lover in the front row next up is lot number 17, a spinach and artichoke dip, beautifully set in a hollowedout loaf of sourdough bread. Dont get mad get e trade and get more than just trading investing. Banking. Guidance. President trump declining yesterday to commit to a peaceful transfer of power if he were to lose to joe biden p this comes as many expect final Election Results to be delayed by weeks or even a month as more voters are expected to vote by mail this year, for more on how all of this could impact the market, lets bring in Morgan Stanley Public Policy strategist he joins us by phone michael, i dont know where begin. What can we expect here . Yeah. The i think the easiest way to understand this is just by understanding that voters are very clearly expressing and survey data much higher desire to vote by mail for fairly obvious reasons. There is a survey of ten bad will ground states they say 15, 16 who did and it takes a lot longer to count the ballots. Ballots can come in after election day and still be counted. These are close races in battlegroundstates we calibrate our own expectations to the polls themselves, so if the polls are telling us story today the day before of a margin of victory that, is high Single Digits nationally and outside the polling of margin of error in battleground states, this then is probably a situation where, yes, you would know in days not the legal challenge was stop within days, but you could probably reliably know within days that the margin of victory was big enough that legal challenges will make a difference they price in a democratic policy page and republican policy path. Though, michael, does the outcome make as much difference as the uncertainty i mean, if we got a resounding victory for one of the two candidates and immediately accepted by other woshgs that lead markets to rally regardless of who the candidate was and is the market that theyre focused on, is that prolonged uncertainty waiting for a result yeah, i mean, it could. Obviously this is pass dependent and what is in the price going into election day quiet results can lead to a relief rally it depends on what is in the price obviously. Were still a little too far out to gain that out just yet. Everybodys coming out on twitter. All the republicans today saying that we have to ensure a peaceful transfer of power the importance of that, after President Trump didnt commit to that michael, is there a scenario here where, you know, the president could subvert a result that goes against him and if so, what would likely be the fallout . Economically, financial markets. Yeah. Listen, i think what investors should be focused on here is that if you have a close race, theres going to be legal challenges as these votes by mail are coming in in. And votes are being counted. If they come in in the proportion thats our surveys are expecting and frarpgly some of frankly the early states are reporting, like north carolina, for example, you have over 300,000 ballot requests compared to 27,000 at this point in 2016 and about four time the amount of requests from democrats you can expect the unease and days after the election as the vote swings around and potentially wherever the starting spoint for republicans to get more favorable the democrats. Legal challenges are probably just a feature of what happens here but at the end of the day, what is going to matter most to investors is when you can kind of see the end game. And thats probably when the volatility stops if you go into the election day with a plan as to which outcome leads to what policy path, thats when youre effectively going to feel more confident about what Investment Strategy you want to follow putting uncertainty aside, if you compare and contrast the lukely tax policies, what is the likely impact on the market . In the stated ambition of the democrats and republicans on taxes, clearly very different. It always has been i dont doubt that if republicans were able to sweep the election youll be able to get another round of tax stimulus if the democrats are to sweep the election, i do question whether or not they would have sufficient votes in the senate to actually meet the ambition of joe biden on the tax side. They have the votes in the senate to have joe biden on the spending side or closer to it. Of there is a fiscal stimulus that cuts against the narrative that we have in our investor surveys which see that as a growth negative outcome. You have to stay close. I think well be talking to you a lot in the next few weeks. Thank you for joining us absolutely. Happy to from Morgan Stanley after the break, banks getting love from the street costco gearing up to report results. Those stories and more hey, dad hey, son no dad, its a video call. You got to move the phone in front of you like. Like its a mirror, dad. You know . Alright, okay. Hows that . Is that how you hold a mirror . [ding] power e trade gives you an awardwinning mobile app with powerful, easytouse tools and interactive charts to give you an edge, 24 7 support when you need it the most plus 0 commissions for online u. S. Listed stocks. Dont get mad. Get e trade and start trading today. 15 minutes left in the trading day. Were now in the closing bell market zone. All the action going into the close. Mike santoli here to break down the crucial moments of the trading day as always. We have stephanie link back as well we kick it off with the volatile market back and forth day, up and down. Were higher now the s p 500 is up. 3 as we head into the close dow up 65 points or. 25 . The nasdaq is the winner what turned it around, mike . Is it really stimulus talks . No. You know, certainly part of a mix. I wouldnt say they dont attribute it to headlines. I you have a bad breaking of stride by a high momentum market and attempt to buy the dip that go bad and the market spent a lot of time in this area of the year to date flat line which is just below where were trading now. You can throw that out there as a potential trigger point. It is mostly the market trying to figure out if there is still a lot more supply every time we get the rallies. You have people pairing back exposure to the High Performance tech stocks. Are we back to mashrket where were focused on the heads lines of the virus and the applicatio implications of the economy . I think the reversal today had a lot to do about the news about mnuchin and pelosi resuming talks of thats the main reason why we have stalled in the market yes to mikes point, 30 of the s p 500 is tech and overbought, overowned. And still probably is to some degree what im looking for is better Third Quarter numbers. We can get out of the funk of focusing on macro. If we make progress on the fiscal side of things, that, i think that is a game changer you cant have 14 million Unemployed People without giving them assistance. There are pockets in this economy doing well, housing, manufacturing, consumer. Really great data. You have to help the joblessness and i think that is the main reason why you are going to get a package at some point. I dont know, before the election or after. Youre going to get one. Are you taking the opportunities to buy, stephanie . Yeah. I mean, weve talked about barbell, right we talked about tech i you own a faur amouir amount. Look, the stocks are still up so much, sara apple and salesforce which i both own are still up 50 on the year nvidia i own, up over 100 so im just trying to be careful. I dont think were there yet. But you know, ive been also focusing on the economically sensitive stocks because the economy is getting better. I do want to own pockets of the consumer theyre naming wells fargo a pick it is attractive and ubs upgrading Goldman Sachs to buy saying the upcoming election should allow for a solid fourth quarter. Earlier today on squawk bachl, we asked about Warren Buffett continuing to increase the stake in the bank and also the future of buybacks. Hes been a great supporter of ours and he continues to put his money where his mouth is st this is the best banking franchise in the world, the best company and he continues to invest heavily by the way, we put a lot of capital buyback stock. The capita is high eastern liquidity is higher. By the way that, is pretty much true of the industry that means this industry is in good shape for whatever comes after us and so we have capital ratios which are far in excess of our minimums when the time comes, well be able to do it. Next quarter or not, well find out when you find out. Maybe come to the upgrades in just a moment. Its funny when you hear someone articulate the position so quickly this morning. But quite clearly the ammunition is there to deploy buybacks when theyre allowed to. The banks are going to face even if theyre not critical as you get to this period of the economy with high unemployment a lot of people on mortgage forebaerns and the rest of it. I think there is no doubt that the whole group is really cheap and the whole group is washed out and the whole group is disliked but you never know whether that will be enough to say value will be realized down the road. But, you know, Everything Else he says is true. Unclear that the market is willing to bid for it. Are you hanging in there, stephanie . Yes, i own wells fargo. They ripped the bandaid off last quarter it was god awful they cut the dividend. I mean it was horrific, right . I think he said expectations are really low fee revenues are improving, especially on the mortgage side and credit and debit side of fees as well of course theyve got about 10 billion that theyre going to plan to cut costs on and i think they can really get their efficiency ratio down. So thats a special reinstruction touring story. I dont own Goldman Sachs. I own Morgan Stanley theyll benefit the same reasons this person upgraded the stock today because of better activity and underwriting and trading and m a. M a, weve seen 256 billion in july and august in m a alone. So these are really favorable things so thats why he upgraded the trade. It has a better dividend that is the play that im going with in that space well, depends what valuation multiple youre looking at, stephanie. I see your point about the themes applying to both. I think actually part of the reason for the upgrade for Goldman Sachs was that Goldman Sachss year to date performance had started to slip back relative to morgue an stanley. Theyre down 8 . Gold after the 5 jum tp is dow 15 . Today is seeing a slight closing of that gap. You are they trade at a discount to Goldman Sachs. I get the performance metric and the lag versus morgue an stanley. I think the reason why Goldman Sachs has lagged is because Morgan Stanley crushed it in the Second Quarter and Goldman Sachs was a little disappointing. There is more they can do and need to do on the efficiency side but i understand i get the relative call. I just feel like Morgan Stanley has a different story to tell in addition to why the benefits are going to see at Goldman Sachs. They got the e trade deal as well 3 versus 2. 5 lets talk about the tech stocks after what has been an ugly month for the entire sector, josh lipton has more on the movers josh a strong session for tech check out the tech sector. The xlk. Looking to post the third day of gains in the last four claw back some of the losses in september. Apple in the green today and for the week trying to snap now a three week losing streak. Another group trying to hold on to gains, chip stocks. Theyre still down 10 from that recent record high still up strongly so far this year back to you. Josh lipton, thank you. Any important divergences happening within the tech sector for a while it was just a straight shot up for all of them but within faang or whether its stay at home, which ones are you watching are they all going in the same direction . We dont talk about, you know, neerply enouarly enough i. It is the bad lagger in the group in terms of upside and pullback still, you know, in an uptrend much more modest one i think tech as a group coming into today was closer to being kind of extremely oversold than the overall markets. So the very same way they led to extremes to the upside, it seems like the tech is more primes for a little bit of a reflex bounce, you know, in the latter part of this week. And maybe thats what some of what is taking hold this morning from the lows. Investors will get another read on the state of the consumer when costco reports earnings after the bell. We have a preview. Hi, contessa hi, yeah, weve seen costco Sales Numbers increasing monthly since march when that stock piling kicked off in earnest ahead of pandemic closures and weve seen e commerce climbing dramatically. The traffic going back into physical stores and plans for the holidays, the corn census is that well see earnings come in 284 a share and revenue at 52 billion for the quarter. Stephanie, what you are looking at they preannounced the samestore sales monthly as contessa mentioned the june, july and august, you saw double digits. So we know the top line and we know what thats going to be all about. What im looking at is traffic and also because they said in july and august, back to precovid levels so that traffic is important ticket up double digits. Thats what im expecting and membership fee i think the consensus is for 1. 1 billion in membership fee they have a 90 renewable rate in the membership. Hoy does that translate into revenues and thats the most important in my opinion a the most important metric it is always higher after certain period of time what does the valuation look like relative to the other big box winners that were truly picked as winners during this pandemic allowed to remain essential . Yeah, costco is richly valued it has a long term approach of management that played out in terms of the performance of the stock. One thing that is a wrinkle and its been a good thing over the years is basically it being a Small Business play. You dont no he if there is a little attrition there whether that really hits them or not theyre winning market share in so many other ways this is it note a company that manages the stock price in a short term theyre not going to massage it quarter better i quarter it always maintains this premium. Sometimes giving you a chance to buy it lower just a little over two minutes left to go in the trading session. What do you see in terms of the internals . Net positive if you look at the volume trends right now. We opened in a sloppy way. Take a look at the highs and lows on the nasdaq weve been grabbing snapshots. Almost ten times as much as the new highs. So you starting to see the damage pile up from this pohl pullback this is over the course of days and weeks. There may be a new undertow of new lows you have to Pay Attention to that thats one sort of flag. Sow ki so kind of inconclusive. Just one minute left. Can we get the chart to start things off you see what a yoyo session its been. In the last hour weve been in the red and green and back and forth. The nasdaq composite up 0. 35 . China is down 2 the ftse 100 is down and same is true in terms of week to date performance. Shanghai and germany is down 4 so far for the week. Gold which had bounced to day has given up a lot of that bounce it is up. 25 for a tough week for gold which is down 4. 5 for the week as a whole. The dollar remains flat. Its been a strong week for the dollar, of course. On the s p 500 sectors, utilities, Consumer Staples and tech lead the charge one sector in the red, health care down. 5 . Energy and industrials and financials only just positive. Were up a quarter of 1 on the s p 500. The dow just slipping close to negative territory holding on to ten basis points of gains the nasdaq composite, the leader of the major indices only up. 3 . A decent close. Welcome back to closing bell, everybody. Take a look at how we finished the day on wall street bouncing up and down and finished up. 51 points on the dow s p 500 up. 3 were still tracking for our fourth negative week in a row. Heading into a friday. This s p 500 is still down a little over 2 as far as the tech heavy nasdaq, closed up second positive day in three. It is still down 1 for the week overall, outperforming the s p 500 on the day and on the week the russell 2,000 index of small caps also closing the day a little bit higher. Small caps are down 5. 5 so far for the week coming up this hour, were going to get the outlook for the ipo market were joined by an easterlyin vestor and alibaba and slack and air bnb and many more names. Hi, russ first to you, mike that ended a bit higher. Talk of stimulus and rising covid19 cases and still just a general indecisiveness about whether we had a full correction or not theyre looking tactically for what tends to bring a correction to some kind of culmination point. We had some oversold extremes. Yeah, weve seen sentiment modify a little bit. Weve seen an uptick in hedging. Its no the necessarily across the board. Now sometimes correction ends with a bang. Sometimes with a wimper. I dont think you can say we finally got that panicky flush you dont always get it. Its totally unclear right now i dont think were very far from the point where you say not a whole lot has changed. Why has prices changed to the degree it has . Credit hanging in there okay Economic Data. Mixed but not falling apart. Weve been buying a little bit. We were trimming towards the end of august after that tremendous run. You include things like the industrials, rails, manufacturing, not just in the u. S. But also in europe. Its no the that we think tech is going to roll over. We like the themes but on a sort of shorter term tactical basis, were comfortable with the economy we think were going to see improvement. Why are you comfortable with the economy and expecting improvement in the cyclicals if we just dont know whether were going to get more stimulus which seems like a huge swing factor if we do get more stimulus, we dont know what size its going to be. The democrats are talking about a skinny bill now that is still in the two trillion dollars. Republicans are nowhere near there. Its a fair question if we take a step back, remember how much stimulus we already received the maybe market has come back much faster than we thought. Were seeing manufacturing rebound, Housing Market rebound. Its no the that its all clear. Were not back to where we were in february. But even without that additional stimulus, were benefitting from the low rate environment, from low inventories and households that came into this crisis in a much better shape. I know you have quite a lot of the cyclicals as well what if we get no stimulus at all for the rest of 2020 are you worried about how the stocks perform they probably would underperform, for sure to russ point, the amount of stimulus in the system is significant. Low Interest Rates for longer forever is actually also very positive but i mean look at just the Economic Data. Other than in jobs, right . The Economic Data has been really good. I mean housing, a million sar in new home sales that is best in 14 years that is a huge, huge number. The manufacturing market pmis are comfortably above 50 expansion. And the consumer, lets just throw out a few names. Lennar, hr, herrmann miller, nike, autonation, autozone all the companies blew it away tlst are pockets in the economy that are not doing so well i know it. Of thats why we need the stimulus thats why i think you get it. But i think there is enough stimulus in the system to have some of the cyclicals do better. This group, industrials, materials, discretionary they have operating leverage im going to give you the same push back we pick it up on the other side. We have breaking news. Meg has the details. Sara, novavax starting a phase three trial in the uk of the potential covid19 vaccine it plans to enroll up to 10,000 volunteers ages 18 to 84 in the uk we talked with Gregory Glenn earlier about enrolling there. Heres what he said. It looks like the uk is going to have a massive surge in cases. So thats going to be the art is getting enough cases to, you know, to declare success and, guys, they are probably a few weeks away from starting the phase three trial in the united states. Operation warp speed saying in a briefing yesterday they were expecting to start in a couple weeks in october in the u. S. Novavax shares up there 5 back to you. Meg, i just wonder if, you know, one of the Silver Linings of the depressing second wave or surge in case thats were getting in places like the uk and in the u. S. In a way it is helpful for these vaccine makers they get a lot of people and a lot of ways to test. Hopefully we can get the vaccines sooner. Yeah, the infection rates are directly correlated with how quickly well get data from the trials can you track the pandemic by the zip code and enroll in places where you see high infection. That should speed up gathering data in these trials meg, just time line again. I always ask you this. But various analysts still saying that realistically q2 next year the only first time well get anything broadly accepted and widely used because of limited supply, its going to take into mid next year for everybody who wants a vaccine to be able to get one according to experts i talk to thanks so much. Lets get to bob pisani. This was a little bit of a disappointment to the pulls today. We were in very wide trading ranges for the whole week really 70 point trading frafrpg the high to the low in the s p 500 pe lose pelosi is coming under pressure to act there is not a lot of conviction right now. Even with lower prices and mega cap names like apple, for example. The rallies dont really last. You look at apple here was 110 earlier in the day still up but not ending near the highs for the day. Elsewhere, the same you thing with a lot of other sectors exxon, 35 that, is four from a new low. Look at that 4 i want to note a lot of strength in country esfs. Brazil, south africa been strong. Big volume today Dollar Strength today. Weaker local currencies that helps those that are expert oriented, for example, like mexico keep an eye on that. Back to you. Thank you so much for that. Ross, Energy Stocks as pointed out been soft. Continue to be soft. You quite like them. Actually, weve been Underweight Energy for a long time were still underweight. We do like parts of the cyclicals. Weve been buying in materials, specialty chemicals, rails, energy we thiscy challenged. Its dhalged challenged in the r term you think about the movement away from a carbon based economy. This the goes to a broader notion there are cyclicals we like. We think some are facing a secular head wind. I was going to ask about energy, stephanie, and what you make of the moves lately we saw weakness in commodities yesterday in particular. In economically sensitive ones like copper and the strengthen in the u. S. Dollar commodities, are they trying to tell us something here i think copper is more important thanenergy i only own one name. Its chevron i no he that dividend is safe. They can maintain that dividend. Thats the only one that i would own. I think its too hard. By the way, sara, its only 2. 5 of my benchmark. I almost dont have to Pay Attention to it anymore. Five years ago it was 9 it really deteriorated there are other ways you can play the Global Recovery id much rather do copper than oil. The stephanie and russ, thank you for joining us thank you great to see you both weekly jobless claims coming in higher than expected. Well ask the Vice President whether the stimulus stalemate in congress is putting the economic recovery at risk. I felt like. I was just fighting an uphill battle in my career. So when i heard about the applied Digital Skills courses, im thinking i can become more marketable. You dont need to be a computer expert to be great at this. These are skills lots of people can learn. I feel hopeful about the future now. I feel hopeful about the future now. music anncr give customers access to precisely what they want, when they need it the most. With adyen, the payments platform that delivers convenience for all. Adyen. Business. Not boundaries. Federal reserve chair Jerome Powell testifying calling for more fiscal support. Zblr the recovery we had so far owes significant degree to the cares act in the support that congress provided. I think while the economy has been doing better than expected, there is down side risk to that. If if there is no further fiscal support. Billionaire investor outlining the own stimulus plan saying every american should receive 1,000 every two weeks for the next two months regardless of Household Income levels lets bring in our vice chairman and head of global policy. Thanks for joining us. Do you think more stimulus is needed do you think its likely i definitely do think its needed its better than expected and we had the full mock downs in place. That is fantastic news lets not forget that a lot of that upside surprise in spending was coming from lower income households who between ui topups and rebate checks actually saw their income go up rather than go down. If we want to bridge through the next couple of quarters, you get closer to when the vaccine arrives with equally good momentum, i think we do need fuller fiscal support. And im afraid notwithstanding the latest news today, im pretty pessimistic that this is going to happen any time this side of january. Would that in mind, what would be your outlook for the economy over the next couple of quarters look, i think that this is a economy that is still has decent Forward Momentum that momentum slowed since the mayjune bounce back so i wouldnt see the economy stalling out or going backwards. But i do think that we could see a significant loss of momentum coming off what will be great q3. Will if we dont reup some of that support the more that jay powell and other members of the Federal Reserve keep calling on congress to pass more stimulus, it makes you wonder what he has left. He says hes not out of ammo if we dont get the fiscal stimulus, what does the fed do so first of all, i think youre totally right the fed has to be a little careful there. I understand why theyre trying to put maximum pressure on congress to step up and deliver fiscal but the political situation, you know it is very difficult. There is a risk that if the fed keeps pleading for fiscal, it looks like theyre out of puts and we had fiscal doesnt come, then things am look very dark. And that could coordinate expectations to a bad place. We have to be careful about that is the fed out of ammo no, its not the they could be doing quite a lot still on qe in particular and open ended qe3 type program we keep buyin until we achieve our goals they can be more aggressive with the 13 and 3 emergency programs. The more generous on main street they could follow the European Central bank and provide very concessional funding for banks to lend to smes, maybe even negative rates and cheap funding. So there is more they can do the theyre not out will bullets. They need to get the balance right. We want fiscal, for sure but the fed has to make it clear that they are not out of bullets and theyre going to stay in the game regardless of what we get from fiscal. If we dont get fiscal and the fed is forced to embrace a couple of the extra measures you outlined, do you think we will be surprised then by inflation a year or two years down the line . The lasting structural changes to the u. S. And Global Economy coming out of the shop will look like but ill tell you right now, it seems to me that we should still very much be more concerned about inflation going too low and staying too low than we should about inflation snapping back too far too fast. I think the fed is right to be focused on trying to lift that trend rate of inflation, break this japan thing we have seen going on globally. But as we go, we have to, you know, look it at the data particularly mass is not so much the noise that we may see in the inflation series. Its making sure that we get over time Inflation Expectations moving to the right place, not too high or too low. Besides the duel fiscal and monetary stimulus issues, this virus is very much with us and, in fact, were seeing a rising caseload. Not a spike in hospitalizations like we saw and we have better tools to deal with it. But we dont have the sort of Game Changing therapeutics yesterday or vaccines yet to deal with the full fledged second wave. How does that unfluns yoinfluenr forecast for the next year youre spot on again with that and yet what were seeing in europe right now in france and spain and now in the uk, is, you know what happens if there is new fall wave gets out of hand you have to stop putting more restrictions back on and thats going further dent activity. I think the fact that the uk said this week, you know, new regulations, new restrictions are going to last for six months that should be a washing shot, too. You know, what are these next couple of quarters look like look, its partly about restrictions its partly about peoples own Risk Management in terms of the activities theyre willing to engage in. The issue i think is simplified in this way. We discovered that we can and its great newsstand back up something between 90 to 95 of activity if were willing to wear masks and take basic precautions. Closing out the last 5 to 10 , resuming activities that have a high touch component that cant be delivered in any other way, thats going to be the hardest part and so, you know, i think we should expect the progress will slow over the next couple quarters obviously, if we have the right amount of fiscal support behind monetary as well together, they can help bridge us through that period of time great to see you. Thank you so much. Thank you also by the way, next week delivering alpha, treasury secretary will be there and have much more to discuss onthe outlook for the u. S. Economy, for stimulus and very much more. Dont forget to register delivering alpha. Com up next on this show, mike santoli diving into sent to find out whether the recent market selloff is stoking investor fears as business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will. You can rely on the people and the network of at t. To help keep your business connected. You can go your own way go your own way your wireless. Your rules. Only Xfinity Mobile lets you choose shared data, unlimited or a mix of each. And switch anytime so you only pay for the data you need. Switch and save up to 400 a year on your wireless bill. With the carrier rated 1 in customer satisfaction. Call, click, or visit your local xfinity store today. Welcome back costco earnings are out. Contessa brewer with the numbers. Hi there. We have a beat on revenues coming in at 53. 38 billion compared to 52. 1 billion anticipated. Were come williing in earnings share of 313. Unclear if that is comparable to the expectations of 248 youve got them talking about the covid19 expenses, pretax for the quarter which include things like paying a Premium Salary and sanitizing. That comes in at 281 million for the quarter. And samestore sales up 11. 4 year over year were expecting the call to start in a half hour were going to be looking for some color here about what traffic is doing going into the stores how theyre gearing up for halloween, thanks giving, and, of course, for the holidays before the end of the year sara . Thank you theyre under a little pressure. Down 2. 5 after hours. You ask the sales are up 11 in six weeks. Its about expectations and monthly sales. Theres not a lot of suspense about the comps and some attention on just exactly how much was this a covid19 beneficiary and what does it mean for margins costco is always made a point of generously paying the people the question is do we have to project out from here higher expenses not that big a move in the stock to say the whole story changed. Hard to argue with the top line print for sure. A big question is with this pullback and the indices have we reset the attitudes of investors to the point where weve got rid of some of the enthusiasm we saw in the summer. It seems we have it has not generated a lot of outright fear. The cnn fear agreed index, its a he real money undechindex. You see its come down from a relative high. Down to the middle zone. Almost in fair territory so its on its way you wouldnt expect it to get down on a 10 down turn. Take a look at naaim this is tactical Investment Managers this is a super extreme reading that we highlighted. So again, skimmed away a little of the overaggressiveness but descended to the point where you say everyone is super bearish and we have to buy the market. Mike, great stuff thank you for that colorado experiencing a coronavirus surge because of a huge college outbreak. Next, we ask the states governor whether a lockdown could be on the horizon. I keep working my way back to you, babe with a burning love inside yeah im working my way back to you, babe and the happiness that died i let it get away servicenow. The smarter way to workflow. Last week colorado recorded the third consecutive seven day period of increasing covid19 infections the weekly case count reaching a level that we havent seen since the end of the states second spike in cases this past summer colorados rising number of cases has been fueled by college aged people. But all age groups are now seeing increased infections. Joining us now is the colorado governor great to you have here, governor what are i going to do about the outbreaks . The key challenge here is certainly containing it it he college level. We have many colleges that are safely back. They have very low cases but at the university of colorado boulder and a couple other campuses to a less extent, colorado state, there is a lesser outbreak. Want to make sure that it doesnt spread to the rest of the community. They are in restaurant communities and other communities. Really the colleges and county Health Departments are taking the actions they need to try to contain that at the college level. Its a much less serious virus for those in that 18 to 22yearold age range. I think what year calling a third wave this is a wave versus what we saw rern saw, how prepared to you feel you are . That is going to be so key certainly the demographics are more favorable what is so deadly about the first wave, it swept through the Nursing Homes and senior facilities until we were able to get the testing of the workers theyre more successful of keeping it out of the areas where folks live just a note the different trajectory of this disease they got a 1 to 2 chance of hospitalization. Folks my age, you know, in their 40s, perfectly healthy folks in my parents age, one in four of thats not good odds. Thats why you quickly threat tone overrun the hospital its it breaks into an older demographic. The were doing everything question to protect everybody and making sure that the safety protocols are followed. So interesting, governor. It seems that other places when we look back in europe and the uk at the moment, theyre being much more preemptive cases may be about to spike. Therefore, going back into various stages of economic shutdown this is something you can manage by contain and cases spiking themselves among the young is not something to be too concerned about . Well, we have to react before deaths look at the hospitalizations much thats a predictive aspect of ultimately fatalities its really hard on anybody to be hospitalized for a week, two weeks, three weeks the deaths are a lagging indicator. We look at the hospitalizations. We look at hospital capaciti we look at the dem graphics. Now some of the same steps that the United Kingdom is taking, they closed their pubs at 10 00, were in colorado. Last serve for come in many kmub communities at 11 00 some are midnight or normal 2 00 in the morning the bulk of colorado has 11 00 last call. We have taken some of the same measures we did see increased transmission in the bars at night. People together. Those are some of the common sense precaution weerz taking to keep our economy open and keeping the recovery on track and saving lives i want to ask about your states finances you recently announced mandatory furloughs for state workers making more than 50,000 more than 20,000 people will be affect fwhid including yourself. We have a 1. 6 budget hole in colorado is the estimate were not suffering bad as some states it is certainly a significant chunk for us thats if there is not another federal package and you covered and whether when they will have a package that will decrease the need for that. The this say time for belt tightening families have to do with less. Many folks lost hours. Maybe two income household drops to a one income household. Its important that Public Sector also share that pain and this was a compassionate way to do it. No one that works for the state making under 50,000 will be impacted the just pivoting back, governor, to the virus the two factors that might have disproportionate effect on colorado Holiday Travel season and also the weather worsening as we get into fall and winter are you worried about those two factors . Well, we had a very close to normal summer tourism season i think in part because we were relatively safe spot for the virus compared to the hot spots. He would want to continue that it also gave us the planning and experience we need to have a winter season not without challenges we indicated our fall weather is wonderful. Our summer weather is wonderful. Our restaurants are all outdoors the many of them are 100 capacity theyre able to keep that up through october. Great weather. It gets in colorado and were working on the ways we can make sure folks continue even in that colder climate whether it is space heaters or fire pits, tents. We want to continue in a safe way to serve both residents as well as those visiting from across the country skiing is safe. What about chair lifts so we were the only ski area in north america to reopen last season we actually had people on the slopes in june yes, there is june skiing in colorado i would have gone to july if the snow holds up. So we want you to ski with and hang out with who you came with and we think that is a protocol to keep things safe and be ready to open for business vail resorts out with earnings thank you for joining us thank you, have a great day you too peloton, slack, and air bnb is the company our next guest is an investor in we discuss the outlook for the ipo market and why he sees a growing turnt opportunity in fel farming. Travels in a rocket ship. Thats cool and then she comes back saying try this or try that. She helps everyone. She helps them feel less worried. Wow mommy, so what is it that you do . Im a financial advisor. She is aig proudly supports all the professionals taking care of our financial futures. Welcome back time to get a cnbc update with sue herrera. St. Hello, everybody. Heres whats happening at this hour fbi director Christopher Ray telling a Senate Committee that Election Security is one of the bureaus highest priorities. And reminding senators that nationwide efforts to sway u. S. Elections have not been found. We have not seen historically any kind of coordinated voter fraud effort in major election whether its by mail or otherwise. Former health and Human Services spokesman Michael Caputo is diagnosed with head and neck cancer. He took a leave of absence a day after he apologized for comments that included accusing cdc scientists of sa decision. And one of the last paintings in private hands is up for sale they estimate the renaissance masterpiece will go for 80 to 100 million when it is auctioned in january youre up to date. Sar yash sara, back to you. President trump has a new tariff fight on his hands. Of this time its no the with china. Its with americas best companies. Thats coming back with closing bell. Flexshares may look simple on the outside. But inside every etf. There are untold hours of careful construction. Infinite what ifs . And contingency plans. Creating funds that help target gaps in client portfolios. Tap untapped potential. And strengthen confidence in you. Flexshares. Powered by over a century of investment expertise before investing consider the Funds Investment objectives, risks, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Good morning, mr. Sun. Good morning, blair. [ chuckles ] whoo. Im gonna grow big and strong. Yes, you are. Im gonna get this place all clean. Ill give you a hand. And im gonna put lisa on crutches wait, what . Said shes gonna need crutches. She fell pretty hard. You might want to clean that up, girl. Excuse us. When owning a Small Business gets real, progressive helps protect what you built with customizable coverage. And im gonna eh, eh, eh. Donny, no. Oh. Well discuss the on going tensions between the u. S. And china and the impact tariffs have having on businesses when we speak with an early investor and companies clininudg alibaba and slack. Were back in a couple minutes 3. Yeah. Uh. Boss doug . Sorry about that. Umm. What. Its. Um. Boss you alright . [sigh] [ding] never settle with power e trade. It has powerful, easytouse tools to help you find opportunities, 24 7 support when you need answers plus some of the lowest options and futures Contract Prices around. Dont get mad. Get e trade and start trading today. To deliver your packages. And the peace of mind of knowing that important things like your prescriptions, and ballots, are on their way. Every day, all across america, well keep delivering for you. Every day, all across america, these days, businesses are adapting to new ways of working. And innovation is at the heart of it. Verizon 5g ultra wideband is the fastest 5g in the world, with speeds up to 25 times todays 4g networks. Its massive capacity and ultralow lag time is already available in parts of select cities around the country. Which means businesses both large and small can innovate like never before. Thousands of u. S. Companies including some of the biggest names on wall street are suing the white house to roll back President Trumps china tariffs. We have the details. Hi, its now more than 4,000 companies that have filed suit against the Trump Administration in recent weeks to try to reverse that china tariff in seeking refunds of the tens of billions of dollars in levies these companies have paid. Theyre paying a group that includes Companies Like tesla, ford, home depot, target and ann taylor they called the size of the corporate response historic, telling cnbc in part, our clients filed this complaint because the u. S. Government exceeded its authority in prosecuting an unprecedented and unbounded trade war against china in defiance of congressional limitations. Now its a stark change of heart for Corporate America which long cheered the white houses tax policy and comes in a time when the pro Business Chamber of commerce endorsed democrats in the upcoming election even though the result of the lawsuits is not expected to be resolved before then back to you. Those numbers are staggering. Who knew there were that many of them just before we let you go, i want to ask you about Health Care President planning a new executive order. What can you tell us about what they got previewed . Well, the president has been saying for months that he would beery leasing a comprehensive Health Care Plan in a matter of weeks and this afternoon in a speech in charlotte, north carolina, where the president is currently en route, expected to lay out a few tenants of this vision, his America Health care vision that has surprise billing as well as drug pricing. These are all efforts under way in congress but had been shelved until the new year the president is going to take executive action on that front and most notably the administration is going to be issuing cards with 200 on them to 33 million beneficial rifz medicare they have been calls the trump cards. They have been at the heart of some of the disputes over this plan well see what Legal Authority the president uses to send out those cards. As soon as i imagine the white house is able to back to you. Okay. Thank you. Farming for the future thats the goal behind the indoor vertical farm company the so far it raised more than 172 million from names like tom calicio and ubers ceo joining us no you is irving fang he is one of the investors managing partner with us from from gvb capital great to you have both hans, youre an investor in startups like air bnb and peloton. Where does vertical farming fit in there were very excited about vertical farming the cost of the led light has come down dramatically its now onetenth of the cost in 2010. It is possible for indoor farming to happen. And then weve been looking for the best thing that can do that and that ends up being irving and his team so very excited about what he is going to tell you on the show. So what is the Technology Behind farming what does it allow us to do that we couldnt before absolutely. So this is the modern farming company. What is modern farming were building smart indoor farms that we locate close to the cities that we serve and what that allows us to do is we grow in the totally contained and controlled environments. And we stack our crops from the floor all the way to the ceiling. We grow under lights that mimic the spectrum of the sun what hans is just talking about and that allows us to grow protected produce year round locally absolutely no pesticides we are 100 times plus more productive than a square foot of farmland and we use a small fraction of water compared to traditional agriculture. And so why is this not been done before, irving . Simply the cost of those lights . Yeah. You know, its interesting people have been growing food indoors since the 80s nasa was doing this, universities and labs were doing this the lights just cost search and the efficiency is really poor. And as hans said, seven or eight years ago the cost of lights just dropped by about 85 . And the efficiency more than doubled. The it turned what was a research and development endeavor into something that could be done in a profitable way. Hans, research and development endeavor into something that could be done in a profitable way. Broader question about your investments right now and the general market mood around ipos. Whats it been like . Weve seen a number of high flyers come out of the gate like snowflake, it was one of the best, and have these amazing pops what does it say about the environment . We have seen seven ipos in the last 15 months in our portfolio. Prior to that we see peloton, slack. So theres a slew of interesting Tech Companies come out. What were seeing during covid19 is that theres a huge shift to Digital Economy as offline shuts down the globe is shifting to online in a hurry you look at 5g coming up and look at the stock price of apple. The stock price doubled in the last 12 months so youre seeing an unprecedented shift to online, to the Digital Economy thats been great for Technology Companies in general. Whats your take on whether bytedance has been unfairly treated over the last six months you know, i think bytedance, obviously is a sensitive topic and the company has been doing the best they can to go through the ups and downs with this Current Administration it is the nature of what we have you see it happening across many sectors not just pertaining to bytedance. It is what it is and its part of the growing of becoming a global player. You have offices in china as well and have a number of investments there. Has this trade tension which has spilled over into technology tension from huawei to wechat to tiktok impacted your business and the way you invest there china has come through covid19 relatively okay you see the economy coming back and you also see more people going back to work and you see supply chain coming back on as well for all sorts of companies. In general, i think people are going through the process okay were seeing that especially in this area of food. Theres just a lot more demand for food to be localized, to be produced locally you see that Companies Like uber doing well on the food delivery front. This is why were extremely bullish. The world is going to have 10 billion people by 2050 you see climate change, fires, tornados happening more than ever the need to have production inhouse, indoor distributed becomes increasingly important back in 2016 and 2017 we decided to make this area and to do this we have a great group of investors. Irving, on that point, do you save a lot as well on transportation costs compared to some traditional farming methods that may be a long way from where the end user and eater of the food is . And at the same time, does that allow you to get fresher food to city centers its a great question in fact, thats exactly what this allows us to do one of the most important things were doing at bowery is not only providing a safer product, were providing surety of supply and simplifying the supply chain overall. Were harvesting crops and delivering them within a day or two. Whereas if you look at the existing supply chain now, its taking weeks of time and in some cases even months of time for food to travel when you simplify that, our food is traveling a lot shorter distances. The fda will tell you that you could lose somewhere between 50 of your nutrients just between the time of harvest and when it gets where its going. When youre simplifying an shrinking that supply chain, youre getting a fresher and more nutritious product. The taste is uncomparable to traditional outdoor agriculture. Its a win across a number of different dimensions. Youve got to try it. It tastes so good. The lettuce, the romaine, you get anything from kind of a mustard spicy sauce to something thats sweet theres something, irving, that you havent got real sunlight, you havent got the fresh air. There must be something thats not as ood. No. In fact, what we are doing in many ways is giving our crops exactly the climate and exactly the nutrients and exactly the light and the water that they want and need for their entire life that means that the crops are actual taken care of incredible well. The other thing about food that people dont realize is that a stress that crops experience can draw out flavor as well. Our ability through the bowery operating system weve developed to actually control different variables allows us to not just grow great Fresh Produce but to bring varieties and flavors and tastes to life that you dont typically find in produce. It is better and fresher product than you will find and the crops have gotten what they need from the start to the finish of their life. You guy versus never made lettuce sound so good. Keep an eye on bowery. Coming up, we talked so much about the work from home trade up next, well talk about the dog ate my homework trade, next. Incomparable design makes it beautiful. Stateoftheart Technology Makes it brilliant. The visionary lexus nx. Lease the 2020 nx 300 for 339 a month for 36 months. Experience amazing at your lexus dealer. The dog ate my homework trade . Latest survey from bank of America Securities shows that as americans have spent more time at home amid the pandemic, many have welcomed new Furry Friends into their family. According to the survey, 37 of respondents said they have adopted a pet in the last six months 69 of respondents said they had at least one animal. The firm expects stocks across various sectors to benefit from the pet boom, including tractor supply, church and dwight, clorox, chewy. The data also showing online pet store spending outpacing brick and mortar spending at physical pet stores which has helped chewy and some others. Mike, i believe you are the owner of two cats so you probably do your share of pet spending. Yeah the family voted 31. I never took you as a cat person. The family voted 31 to adopt this kitten which was a stray outside our house. It was a veto proof majority yeah, we do have a couple of cats by the way, to the point of this idea on investing behind it, when the pandemic ends, its not like the pets go away so youre going to be spending on them. Thats good analysis. The title was misleading. I was hoping it was going to be examples of people using child like excuses for their work. Were out of time. Im melissa lee and this is fast money. Tonights trader lineup guy adami, tim seymour, Karen Finerman and dan nathan. Sheila bare is with us her take on the health of the big banks. Plus sky high outrage as the airlines see another taxpayer bailout. Why this proposal could hit some