Out the procedure by which the investigations current wily underway are to move forward. The president and his allies called it a sham, comparing it to sovietstyle justice that is unfair to mr. Trump and not consistent with impeachment probes of the past. The president tweeted after the vote the greatest witch hunt in american history. Weve heard that once or twice before. Meantime, democrats continue taking depositions including the first from a person who was actually listening in on the phone call that put the whole impeachment probe in motion, Lieutenant Colonel alexander vinman. He said the transcript of that call released by the white house had some important edits in it. Republicans, however, say none of the edits were senate. The were significant. The person who could bring the most tension is former National Security adviser john bolton who exited the administration in september after repeated clashes with the president over foreign policy, including crew crane. The Panel Announced they want him to testify next week. So once again the big question this week is where are we in the impeachment process . What is to become of President Trumps presidency . And what could we expect from the president as the process now moves forward . Well, here the discuss all that and much more is someone who doesnt need much introduction, Anthony Scaramucci was for a short time ten days, i think the Communications Director of the trump white house, and hes founder of skybridge capital. It was 11 days, gerry. Dont shortchange gerry eleven days that shook the world. You and i had a good, we were in the oval office together on one of those days. Gerry yes. The famous photograph of you and reince priebus. It was a wednesday, i i know i was only there for one wednesday. Gerry lets get on to the president , because exactly, you did serve the president. You supported the president very vocally i was on his transition team. If. Gerri one of his most vocal supporters x then you have become one of his most vocal, vociferous critics. What happened . Well, and again, i was fired over two years with ago, and i maintain loyalty to his agenda and to the republican agenda over those two years. But youve had this slow burn, if you will, in many Different Things. The press is the enemy of the people. You dont look like the enemy of the people to me. The separation of women and children at the border, there were many Different Things where i had to say i disagreed with. The last straw for me was basically the four congresswomen where he was saying to people that they needed to go back to country they originally came from. Three of them were born here, all four democratically elected into our congress and told my italianamerican grandmother when he got here to go back to country where she came from, its racist, nativist trope. I think its dishonorable. He went after my wife as well. And after giving him three years and, you know, a tremendous amount of money, too much money for me to even admit to because im embarrassed by it, i think enough is enough. So the content and the policy are now being totally outweighed by the style, the characteristics, the personality and what hes doing on foreign policy. Gerry but for me gerry people change their minds, they do it all the time. A facts change, but again, youve gone from being, you know, a strong supporter in a short space of time. You tweeted on the 3rd of july that the president was going to win 40 plus states. That was on the 3rd of july. Explained to me, you said tell me why im wrong x. Then just quickly, and then just this week on halloween you tweeted, as you have done many times in the last couple of weeks, you said real donald trump, president , a total embarrassment. Again, why this passionate so lets go back. And i maintain this. And that was in context of if they puppet elizabeth warren, and put up elizabeth warren, and this was obviously before the impeachment inquiry, before we understood the disavowal of the constitution. Gotta go back to july, we didnt know about the lawlessness. If they put up elizabeth warren, and i still maintain this, if he survives the impeachment inquiry and they put up elizabeth warren, i think he will beat elizabeth warren. Will he beat her by 40 states . Back in july, yes. Can he beat her by 40 states today . No. I think hes politically wounded and is in jeopardy as a result of the facts that have unfolded since that tweet. The total embarrassment is the relationship to what hes done to the country and how hes handled himself. You just have to think about this, whatever you think of him, its clearly not a witch hunt. He has actually broken the law. You can look at the transcript gerry how has he broken the law . How has he broken the law . Its a foreign violation. You cant go to a foreign inti i have and ask a head after state gerry thats still arguable. The investigation was related to what happened the ukrainian role in what they may have done in the 2016 election and how they possibly, in some peoples view, may have helped democrats. Okay. Why dont we stipulate this for the sakes sake sake of our a argument, i believe the information that i have, invite me back as it unfolds in the public hearing, and i hope well prove prima facie that he broke the law. Thatll be up to republicans to decide if they want to step to a higher level of patriotism and recognize that the country was set up so that all of us were subservient to the law. If you allowing one person to come above the law, i think thats going to be very damaging to the country. Gerry just quickly again on this issue of the president s character, you said you gave a very eloquent answer when i firsted asked you about what changed your mind, and he said in particular some of the thing he said about those four congressmen and you as a child of immigrants felt that strongly, the racist trope that people have used in the past. Are you actually really saying that was the first time, when he said those things, that you were really so concerned about the president s character that you went from being a supporter to being an opponent . I would encourage you and every one of your viewers to read my Washington Post editorial where i louis dated all the steps that took me to where i am today. And i also admit that i did some moral equivocation on the president , as many republicans have. Theres no way you can look at prima facie elements of his character and personality and say, okay, those are acceptable things. What you do is you hold your nose, and you say, okay, the choices are between secretary clinton im a lifelong republican and candidate trump. So you hold your nose and say, okay, im going to go with this person. The scales are those policies versus his character, and now im telling you it came to the conclusion to me that the character has far outweighed the elements of the policy. Hes destroying the western alliance. Hes brought down and disrupted the entire international gerry the western alliance hes racially charging the nation. Gerry hes trying to get european countries, nato members to do more in their own defense. I think a lot of people would agree with that, the europeans for a long time with the exception of the british, frankly, have not and one time i actually explained this to the president , he disagrees with me, our grandparents set this thing up, the postworld war ii architecture to make sure that the United States had, by a big factor, the largest, most superior military. One of the reasons why we were reluctant to push people on nato and reluck about the to arm and nuclearize places like japan is we didnt want people to get too much we felt we were going to make the benevolence of our democracy to help suppress conflict in the world. Gerry and we did, right . We had nato, we won the cold war. But it was, again, the United States, countries like germany and the earth netherlands and increasing arely people like france, i think when you say destroying the western alliance, i think a lot of people [inaudible conversations] but lets talk about how hes doing it. Very simple. You can reset every relationship, every alliance, every situation, frankly, domestic or otherwise needs to be reset and recalibrated. But the coarseness of the style, the going to g20 up in ottawa and machine gunning everybody and negatively tweeting about the canadian Prime Minister and heading for singapore to visit with the north korean dictator. The style of the personality and the content and the delivery is shattering to a lot of people. And so hes got a 69 disapproval people in just people discuss liking him, and its way more in europe. Its not necessary. Gerry coming up, well talk in more detail about the impeachment investigation and the kind of reactions we might expect from the president. Stay with us. Snacking can mean that pieces get stuck under mikes denture. But super poligrip gives him a tight seal. To help block out food particles. So he can enjoy the game. Super poligrip. On the sleep numberhe v360 smart bed. Le can it help keep us asleep . Yes, it senses your movements and automatically adjusts to keep you both comfortable. And now, save 1,000 on the new sleep number 360 special Edition Smart bed, now only 1,799. Only for a limited time. Gerry im back with Anthony Scaramucci. Anthony, on the president s impeachment, likely impeachment. You think he broke the law, you said that already. Not a single republican in the house this week voted for this impeachment procedure that the House Democrats are pushing forward. What is it that you see as someone who used to support the president that you think he needs to be impeached which not a single House Republican is able to see . Well, why did they not vote for it . Gerry yeah. Okay, well, its political selfinterest. Theyre looking at the tea leaves and saying their bet is best made with him. The other issue is that the president s a bigtime bully. He has very low selfesteem. If you go against him, he hammers them on twitter, and its intimidating to normal people that the president of the United States would hammer you on twitter. Gerry so theyre all cowards . Politically ec expedient. Theyre not cowards. There will come a teem when theyll time when theyll break from him. When he gets down to a 28 approval rating, theyre going to cut and run. This is all borne from political selfinterests. Youve never felt worse in your life when the president s calling you an unstable nut job job gerry i havent had had that. Thats what those guys are afraid of. They dont want to get primaried from the right, and they dont want to get knocked out of what would i call the trumppublican, if you will. James madison, who wrote those articles of impeachment, is probably spin anything his grave dish spaining in his grave. They probably thought thered be more valor gerry i think people would say is, again, yes, you may have what you said about some of those republicans may be true, but a lot of them will say, and ive had conversations with them, these are thoughtful people some, by the way, are stepping down next year, so theyve got no particular vested interest in running, theyll say, look, what the president did with that ukrainian phone call wasnt wise, he exercised poor judgment, but we remove a president from office for that less than a year before the people get to decide . Theres 193 nations in the united nations. President s been president for almost three years. Do you think he had one phone call like that or do you think there are many phone calls that have been stuffed into that super secret server . [inaudible conversations] i know the guys personality. Im willing to bet a large amount of money that there isnt just one phone call like that. Gerry so you think hes trying to get other countries around the world to help him get reelected . No question. And what we know about him from people like general kelly and others, we know theres a certain amorality. General kelly saying, hey, i was trying to help him, and if he put a yes man in place, he was going to end up getting impeached. You get impeached for doing things that were dishonorable. The signal from general kelly was, hey, this guy is capable of this level of amorality and this lack of judgment. For me, its a fitness to serve issue, its a judgment issue. We havent even gotten into the policy discussion about pulling the troops out of the kurdish area gerry right. But really against the interests gerry weve never impeached a president running for reelection. And if this process goes through, itll probably be early into next year. We will be into an election year. Shouldnt that really be an issue for the people to decide . I think if you want to be a country that abides by the rule of law and you want to make sure that everybody in that country is beneath the rule of law and that a standard is a super high standard, then it really doesnt matter about the timing. When Ronald Reagan broke the amendment and we had a proxy war in nicaragua, you know what the difference is . He admitted he was wrong. Gerry maybe its the president just admitting that would certainly help the president. But hes not capable of doing that. Tier right. It has to do with his character and his approach towards things. Hes damaging the country, hes hurting the hard and soft power of the country, and he probably wont be removed, but i think its a good thing theyre doing by impeaching. Gerry well take another break there. Up next, we will talk about the economy, President Trumps role in it and whats powering the stock market and what effect that may have on his reelection prospects. Stay with us. 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You said earlier on that when you think about the president S Performance in office in terms of policy and effects against his judgment. We talked a lot about his character and his judgment. The economic record is pretty strong. Weve just had numbers showing strong job growth, strong wage growth, economy grew just under 2 in the quarter, not great, but much better than some people feared. Its a pretty strong record here now for three years of you say its a very strong record because the president was tweeting in 2012 about a 33. 9 president 1. 9 growth in the obama economy, he said it was anemic and the economy was in trouble. I actually dont dislike the economy here. But you spent 2. 25 trillion to try to get growth up, you only got two quarters of growth that lee tated. Youve levitated. You have had the Federal Reserve cut Interest Rates three times now x theyve also begun an assetpurchasing situation again, so you know theres underlying weakness in these numbers that we all gerry more than ten years into expansion. Normally at this stage you would be seeing all kinds of stresses in the economy, were not. Again, three years into the presidency, you can argue about im trying to be as objective as possible. I like the president s deregulatory policies, the delivering of the administrative state, i like a lot of the judges that were selected including the two Supreme Court judge withs. Really just trying to be objective. But the deficit spending and the inconsistency on trade has actually hurt the economy. Look at the Investment Capital numbers. The president had a historic opportunity to create symmetry in the chinese trade representative. We recommended a 2 increase in tariffs for ten quarters and given the supply chain and Business Leaders large and small the opportunity to adjust themselves. He wasnt capable of doing that. Reason being is he doesnt listen to anybody gerry right. Youre going to run the risk offing is him for another five years in the office by himself with his twitter feed, i think thats very dangerous gerry but its a choice. A lot of people do have reservations, in the end, its going to be a a choice between the president and his record, character and Economic Performance and the democrats. And a Democratic Party [inaudible conversations] if they dont put up elizabeth warn and they put up somebody more moderate and more seven tryst do you think biden could win . Well, i think biden has been struggling, but, yes, i do think he could win because of the blue collar nature to joe biden. I think Pete Buttigieg could win, it doesnt take [inaudible] [inaudible conversations] gerry the party is medicare for all, green new deal, raise taxes, regulations, take on wall street. Is that going to be an attractive message in. No, the best thing President Trump has going for him right now is whats going on in the Democratic Party. And if they puppet a Democratic Leadership Council sort of a person, a bill clinton circa 1992, they would roundly beat President Trump. And so this is one of the good things that he has going for him. If he can survive the impeachment, and i predict he will not, i predict that there will be a waterfall of information that comes out over the next 36 months gerry is he going to be removed by the senate . I think hes going to resign from office by march of next year, and i think the democrats are going to be running against a different sort of republican that will beat them, whether its a Nick Cay A Hale hi or larry hogan, theyll be running against somebody thats more normal. Any functioning adult, actually, i think would beat most of those people. Gerry thank you very much, indeed. Fascinating thanks, gerry. Gerry well, just ahead, as the economy does continue to grow, voters will have to decide how much theyre willing to risk that when they go to polls next year. Ill explain. Driverless cars, or trips to mars. No commission. Delivery drones, or the latest phones. No commission. No matter what you trade, at fidelity youll pay no commission for online u. S. Equity trades. 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Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Liberty mutual customizes your Car Insurance, hmm. Exactly. So you only pay for what you need. Nice. But, uh. Whats up with your. Partner . Not again. Limu thats your reflection. Only pay for what you need. Liberty, liberty, liberty, liberty you may have gingivitis. When you brush, and the clock could be ticking towards bad breath, receding gums, and possibly. Tooth loss. Help turn back the clock on gingivitis with parodontax. Leave bleeding gums behind. Parodontax. Gerry this week produced more signs that the economy is in healthy shape. Total Economic Activity grew at just under 2 . Now, the thats not spectacular, but it defied all the talk about a possible recession dominating much of the media. In october the economy added another 128,000 jobs despite the strike at gm which resulted in thousands of workers being idle. Wages continue to grow at a healthy clip. The u. S. Is now well into its 11th year of growth, and it looks increasingly like the Strong Performance will present voters with a critical dilemma in next years political rex. Democrat election. Democrats are proposing radical change. Elizabeth warren would, if shes elected, raise taxes, increase business regulations, upend much of wall street and fundamentally change the balance of power between workers and employers. Now, many voters may like the idea of these changes and many are clearly unhappy with some of the things President Trump says and does. But whatever they think of him, they are going to ask have to ask themselves, do they really want to take the kind of risk that a radical change in Economic Management would represent for their and americas immediate prosperity . It may, in the end, be that calculation rather than whatever they think about impeachment that will determine what happens just one year now from this week. Thats it for us this week. For the latest show updates, be sure to follow me on twitter, facebook and instagram, and ill be back next week right heren the wall street journal at large. Thank you for joining me. Barrons round table sponsored by this week Harley Finkelstein on how the company is helping retailerses fight back against amazon. A barrons exclusive. Why the sec is finally investigating, and barrons experts discuss how to invest in china despite ongoing trade tensions. Barrons round table starts now. Welcome to barrons round table where the sharpest minds on wall street meet to get behind the headlines and prepare you for the week ahead. Im jack otter. We begin with what we think are the three most important things investors should be thinking about right now. Grubhub shares lost more than 40 of their value in one day. Then pinterest plummeted. Whats next . Do you know enough about the stocks in your portfolio . Were now halfway through earnings season, and so far theres been little growth in profits. Can the market rally be sustained in and in a barrons exclusive, the sec is now investigating why teachers across the country are being sold high cost retirement products, a story we first reported back in may. On the barrons round table tonight, ben, lauren and jack. Jack, im going to start with you. The market took grubhub to wood shed this week. Absolutely pounded, as you say. The Quarterly Results werent great, the guidance was worse. There was a letter from management where, to their credit, they were pretty frank about some of the troubles to company. The chief executive said we believe online dines are becoming more promiscuous. You know, for the record, im not a swinger just because i dont care which which Third Party Delivery Company Brings my meatball hero. Dont make me out to be a french fry philanderer, all right . [laughter] this companys having a hard time differentiating itself in a crowded field. When i heard that, it sounded like i could name a lot of companies that have that same problem. I mean, pinterest might be one with. Then youve got the weworks and the ubers versus the lists. I think a lot of the lyfts. I i think a lot of these companies are getting disrupted by investors. Its a great point, and they can still continue that disruption. When you look at all these delivery companies, there are publicly traded Pizza Companies that have had a big advantage up until now, but suddenly every restaurant is a delivery restaurant. You could see them get hurt, but also the deliverly companies themselves struggle to compete with each other. Go into any big market, youre going to see a half dozen different options for who can bring your food or how to pick up your food, order it online, just very crowded. Jack do you think more generally investors are starting to get impatient with these companies who say, hey, were going to grow forever profits . Maybe not. Thats been going on for some time with the storied stocks, there was stows supposed to be supposed to be a path to profitability. People are saying, wait a is second, this field is way too crowded. Everybodys giving away freebies, im going to wait and see how it shakes occupant. Jack ben, tell us about the earnings so far. Depends really if youre a glass that half full or half empty person. Earnings have been company have been beating their earnings estimates no problem and at a higher rate than they normally do, and thats because the bar has been lowered really far. But earnings still arent growing much, actually down a tiny bill. Theyll probably finish up a little bit at the end of the quarter, but theres not much growth this to speak of. And that a hasnt been a bad thing for the market though partially because it turns out we dont need a ton of Earnings Growth that doesnt make sense. It doesnt, does it . But this is true. Over the long term, stocks follow earnings. But over shorter periods of time, the stock market doesnt do well if earnings are growing too fast or too slow, anything in between, they do just fine. Jack the goldilocks saw is that because people look forward . Exactly right. Next year probably around 9 , theyre wrong, its going to be closer to 5 . Jack and Everybody Knows that. Everybody knows that. It might be a little higher or lower, but everybody know that. Any growth is good. Dont know whats going happen with the macro situation, global growth, etc. , but earnings will probably be just with fine, and as long as thats the case, the markets should be okay. Jack lets move on to more of a pocketbook issue. Lauren, tell us about annuities, teachers . Whats going on there . As you say, barrons had an exclusive story in may highlighting what has been a festering problem, the practice of selling taxdeferred annuities to teachers for their retirement mans. This is a ridiculous we should point out a 403b is a nonprofit equivalent of the 401 k . Thats exactly right. This is a bad idea because young teachers in particular dont need to worry about having income in retirement, they need to worry about having income in the first place and putting money away and saving it. This is also, as i said, a ridiculous redundancy because their portfolios are already taxdeferred. So you dont really need taxdeferred product in a taxtemped portfolio. And their piece on annuities are quite high. In fact, some people say these sorts of annuities are sold and not bought, and the point is that they are great for the salesmen because they make a big commission, but what is a 30yearold investing figure retirement for retirement 35 years from now really need in her portfolio . Income through growth stocks. You need to buy things that are going to grow, going to compound and maybe some dividends. But you really need to think about building a large portfolio. And you need to save. Jack thats very important. Also you need the growth, and i guess what happens is because annuities cant really they have guarantees that stop them from going down, that sounds safe. But, jack, safety is not really what you need when, a, you have a pension and, b, i you have a job thats pretty secure for a teacher, right . It sounds too complicated. Find yourself an index bond, set it and forget it. If youre young without a lot of money, you should be spending more time thinking about your job and less about your asset allocation. Your most important asset is your present value of your future earnings. Spend a little bit of time to get your index fund right, leave it alone, work hard. Jack not only think about it, but think about the right things. Whats happening here is people who are not particularly financially savvy, right . And so when the salesman comes and says, hey, this thing is very safe, its going to do well, if you dont know any better the fees are high, its too complicated, you cant do it on your own. Leave it to me. Its not that complicated. Read your barrons, you can do it on your own. Jack coming up, solid advice on how to invest in china. But first, shopfys ceo is explaining how the we think that while marketplace may be a great place to access a different audience, fundamentally entrepreneurs large and small, they want to have a direct relationship with the consnsnsns now you can, with shipsticks. Com no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. Sending your own clubs ahead with shipsticks. Com makes it fast easy to get to your golf destination. With just a few clicks or a phone call, well pick up and deliver your clubs ontime, guaranteed, for as low as 39. 99. Shipsticks. Com saves you time and money. Make it simple. Make it ship sticks. Shipsticks. Com saves you time and money. Car vending machines and buying a car 100 online. Vented now weve created a brand new way for you to sell your car. Whether its a year old or a few years old, we want to buy your car. So go to carvana and enter your license plate, answer a few questions, and our technowizardry calculates your cars value and gives you a real offer in seconds. When youre ready, well come to you, pay you on the spot, and pick up your car. Thats it. So ditch the old way of selling your car, and say hello to the new way at carvana. Listening and observing for scientists at 3m. One of the products i helped develop was a softer, more secure diaper closure. As a mom, i knew it had to work. There were babies involved. And they werent saying much. I envisioned what its like for babies to have diapers around them. Thats what we do at 3m, we listen to people, even those who dont have a voice. At the end of the day, we are people helping people. The magic moment. Congress really democratized wall street. I wanted to have a firm that wanted to get everybody in. Because people couldnt access wall street. We wanted to be agents of change. For the better. You may not have heard of shopify, but youve possibly using the companys services. Shopifys software powers more than one million Online Stores and is leveling the Playing Field for retailers getting crushed by amazon. Joining me now, the coo, Harley Finkelstein. Most people havent heard of you yet, of course, they have used you. Your stock is up more than a thousand percent, your company is now bigger in terms of market value than delta, ford, ebay. Youve got famous clients, kylie jenner. So why havent we heard of you, and what exactty do you co . Its very intentional. For a long time, shopifys been the brand behind the brand, trying to make entrepreneurs, Small Businesses and big businesses look really good by helping themself anywhere they want. The list riff to history of the company is we felt entrepreneurs had a hard time building beautiful Online Stores. It was out of their reach. Going back to 2006 we created this piece of software to build a Beautiful Online store. And more recently what started happening is some of those stores got really, really big. Kyler jenner, for example. So we began kylie jenner, for example. Around the ipo, 2015, we began to see the Procter Gambles of the world, the gate raids of the world, the aerosols of the world began to come to shopify to build their own direct to Consumer Online business, and in aggregate we now have about a Million Stores in the platform that have sold more than 100 billion on shopify. Jack why is this such a big deal to create this platform . Its just soft area. Cant software, cant anybody use it . The idea is if you know how to use email, its very, very simple. But as you grow to be some very large retailer, you never have to leave the platform. Its very simple to start and very scalable as you grow. And the other thing as is you may want to crosssell on things like facebook, instagram or other social media platforms. Shopifys really the worlds first e tail operating is system. Jack am vonn does this, ebay does this, why would someone want to work with you . Whether its amazon, ebay or any of the verticalspecific marketplaces, what theyre effectively doing is theyre representing customers to these brands. It is their customers they are saying to you you can use them if you want, but at a certain point, tough pay for them, or if we actually want to compete with you, you cant have those customers anymore. We believe independent businesses are much better, and consumers are demanding they want to buy directly, so we think that while marketplace may be a great place to access a different audience, fuldly entrepreneurs large and small, they want to have a direct relationship with the end consumer, and thats what shopify does. Jack one of the interesting things to me as i look at the economy right now, obviously, disruption is a huge part of it. But you are disrupting the disrupters, amazon, e ebay, and helping the old line mom and pop retailers. Your founder said that he was arming the rebels. So can you explain that analogy, and again, to me, it sort of plays into like the Craft Brewery thing and people wanting some veracity in the brands theyre buying. So many great entrepreneurs are great at making a product, a beautiful pair of shoes or a motorized skateboard. The problem is historically theyve had a how far time getting those into the hands of consumers, and they were forced to use an intermediary. And we really feel like consumers, they want to buy the products and people making the products. But that was out of reach for a very wrong time. And i think what technology has allowed shopify to do is build software that for 29 you can start your own business, and it can be really large without ever having to need anything else. Jack this is your new venture in a sense, youre doing fulfill m. Youve got robots in the warehouse, and youre sending it in the stores own branded boxes. When we looked at our customers, were a global company, but the majority of our merchants today are in the u. S. We realized that one pape point was fulfillment, and theres all these warehouses that are sitting empty or have some capacity, but theyre not able to access customers and brands who may want to use their warehouses. So well creating this network where were going to aggregate third party warehouses all over the United States and using our own Management System and some robots, were going to help all these entrepreneurs better fulfill their orders and compete with some of the delivery expectations that consumers now have because those large marketplaces. Jack and make it affordable for them. Very affordable for them. Jack you Just Announced this week youve with hit one million merchants, come back when you have two million. I love that. Thank you so much. Jack coming up, our ideas on what you can do to improve your portfolio. But first, despite trade tensions between the u. S. And china, there are opportunities driverless cars, or trips to mars. No commission. Delivery drones, or the latest phones. No commission. No matter what you trade, at fidelity youll pay no commission for online u. S. Equity trades. Its been a long time since andrew dusted off his dancing shoes. 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So come ask, shop, discover at your xfinity store today. Its hard to find a region that offers more opportunity and more danger for investors than china. This weeks cover story, barrons helps invest terse navigate that tricky market. I want to start with you first, lauren. Give us an overview, what are the big takeaways from the cover story . Big takeaways are that while chinas in the news for a variety of upsetting things the trade war, the hong kong protests in fact, its a wonderful place for investment because the population of people with money is growing and growing very rapidly. So theres a whole array of Consumer Companies that are going to benefit from this, and were not just talking about the wealthy people in shanghai and beijing, were talking about third and fourth tier cities which together represent a population the size of the u. S. Jack thats an amazing statistic. Leon, were journalists talking about this, youre putting money to work. To you agree with what lauren had to say . I thinks totally correct. The story is around the revolution of the consumer, how changes in Consumer Behavior are happening as that consumer becomes wealthier, and theyre going to make choices which benefit Consumer Companies that can serve them. Jack its just hard for me to talk about china though without all of those headlines that lauren mentioned. The trade war must have some sort of an effect on the market, right . Yeah, no doubt people are concerned about the impact of the trade war on corporate spending, for example, but the choices that the consumer is making is no different to the choices that we would be making. You spend what you need to do to get your kids to school. If youre changing your consumer habits, you do so as well. Ultimately, those trends are still here, and theyre going to last for a long time. And we often hear about the questionable reliability of data coming out of china. Youre not worried about that . Well, at the end of the day im not going to say the gdp forecasts are perfect, but if theyre going up, theyre still growing at a rate that is faster than rest of the world, and you really want to focus what the result ares for the businesses look like, and those are still reflecting with the exception of a few sectors, the consumer is strong, and theres demand for businesses who do things right. Jack give us an idea of one of the sectors that you like. You want to be exposed to the consumer. It could be everything to do with education, it could be new Technology Like the, you know, food delivery apps in china are ten times the size of what you have in the u. S. , so success. Again, away from old china which is Stateowned Enterprises and much for more towards new china. Lets talk about some companies. In the round table participants mentioned alibaba, jb. Com, these are companies that can be bought on u. S. Exchanges that they really like. What are some of the companies you really like in the area . Yeah. So i would definitely say ten cent and alibaba are incredibly well positioned. You have seen that baba continues to bang out extraordinary numbers. You could add a few other u. S. Traded ones like new rental education which is also incredibly strong. And food delivery, thats mei twan. Jack so, lauren, for those investors who may be worried about buying stocks in china, there are ways to play the Chinese Consumer without actually purchasing a chinese stock. Thats correct. You could purchase a french stock, lvmh. That was one of the picks. The company has a big presence in china in luxe arely goods luxury goods, and this is for people who dont really want to buy the a shares in china, the h shares in the area but really want to stick to a u. S. Exchange and to nonasian exchanges. We were talking about grubhub early in the show. You mentioned the chinese food delivery market. Youre not worried about companies there getting grubhubbed . [laughter] good point. Well, again, grubhub is absolutely dominant. Theyve got one competitor thats less than half the size. They do ten times the volume. They take a lower take rate than what grubhub does, but because theyre so efficient this is mei twan. Yeah. Jack you dont just invest in china, you invest around the emerging markets. Ive been saying it for a while only because i read it from some of these guys that are saying emerging looks like a screaming bargain in terms of the valuations of those stocks versus the rest of the world. At the risk of you having to talk your book, do you agree . Valuation is important, and its cheaper than other asset classes. You guys talked about this, Earnings Growth is still strong, the last five years have actually been the anomaly where Earnings Growth has been slow, but were still confident that its here to stay. Jack i ill talk your book for you. Not only has your funden the emerging market index, youve beaten the s p 500 which is a neat trick. Not my bogey, but ill take it. Jack thank you very much. Up next, round table limu emu doug hour 36 in the stakeout. As soon as the homeowners arrive, well inform them that Liberty Mutual customizes home insurance, so theyll only pay for what they need. Your turn to keep watch, limu. Wake me up if you see anything. [ snoring ] [ loud squawking and siren blaring ] only pay for what you need. Liberty. Liberty. Liberty. Liberty. Its what gives audible themembers an edge. Listening; it opens our minds, changes our perspective, connects us, and pushes us further. The most inspiring minds, the most compelling stories audible. You may have gingivitis. When you brush, and the clock could be ticking towards bad breath, receding gums, and possibly. Tooth loss. Help turn back the clock on gingivitis with parodontax. Leave bleeding gums behind. Parodontax. Strongve is one of a kind brilliant unbreakable Engagement Rings now 20 40 percent off shop unique bridal styles at zales, the Diamond Store skip to the good part with alkaseltzer plus. Now with 25 more concentrated power. Nothing works faster for powerful cold relief. Oh, what a relief it is so fast so, jack, sometimes there are conflicts between making money and doing good, but you seem to have found a great example of both actually working in concert. Dont make me out to be some kind of sustainable investor here. Im against public displays of affection, that includes tree hugging. But you dont have to be a treehugger to be, i think, excited about alternative energy. There is rapid growth ahead for solar and wind. And it doesnt have to do with politics, it doesnt have to do with taxes. It has to do with costs falling. Both of these are already quite with competitive with fossil fuels. Jack if youre a utility, obviously, the ray of sunshine, the i blowing wind is free marginally, but theres a big problem. I hear people say, great, what happens when the wind stops blowing and the sun stops shining . Its a really important point, and the key here is batteries. Its whats happening with the cost of batteries. It has plunged over the past five years, it will continue to bad luck in the years ahead plunge in the years ahead because everyones making Battery Technology better. That same Battery Technology can be put to work by utilities to make better use out of their solar and wind power. When you put those things together, youve got really, youve got another big inflection coming. And this might not be a green new deal, but theres plenty of green to be made if youre a stock investor here, you know, Companies Like first solar, albemarle, plenty of stock opportunities. Jack and very quickly, i hear about the loss of jobs, coal mind ifers miners being put out of work. Politicians will have to address that, but there are also going to be jobs gained from people building these new generation capabilities. Jack we want you to go into the week ready to make your next move. Lauren, ben, give us one actionable idea. Id like to highlight a stock pick from our china round table, thats [inaudible] insurance. It yields about 1. 8 . This is not only an insurance company, it offers fintech play, a banking play, a telemedicine play. Its a play on the rising china middle class. Jack and ben . Buy the fangs with two as. Some are doing well like apple, some are doing terribly like netflix. We have two months at the end of the year where theyre going to all start working together. Jack to read m check out this weeks edition at barrons. Com. Thats all for weekend. David i am david asman in for the vacationing lou dobbs. President trump as undergone the radical dems trying to upend his presidency. Today both the nasdaq and s p 500 reaching record highs today. Job numbers far exceeding expectations. Black unhe ploim has never been lower in history. The president touting the nations economic success
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