draghi and the ecb. >> potential for disappointment seems obvious. >> indeed you are right, simon. thanks again. great show. >> that's it for "power lunch." thank you for watching. >> have a great afternoon. "street signs" begins right now. and welcome to "street sig s s" where the dow is taking a deep but will they strike up a softer tone in jackson hole? and push stocks higher. a fed look ahead at interesting stats on what the fed has really meant for stocks. mitt romney speaks tonight but larry kudlow is fuming over something you heard of paul ryan last night. larry is here to clear the air. some say costco is the world's best retailer. why is walmart eating its lunch? and the world's richest woman steps in it again. what she said that has aussies

angry, mandy. a market breakout. not the kind that many want the see after very little movement, stocks are dropping. with the dow touching the lowest level in four weeks. s&p 500 touching a multiweek low after experiencing the narrowest three-day trading range in seven years prior to today. the nasdaq has the biggest loss of the major averages and its largest one-day drop in more than a month. let's get more on what's happening on this risk-off day with bob. i want to talk about commodities. talking about gina in a second but shocking words in the last half hour saying that the era of rising commodities is not continuing. we are certainly seeing that backed up in the markets today, right? >> yeah. demand for commodities is definitely lower. see that in the coal industry and see what's going on generally throughout the markets right now. so for today, we have got a weak euro that's creating a strong dollar and that's putting

pressure on commodities, commodity stocks and country that is produce commodities. you mentioned australia. the etf with australia is down almost 2% today. south africa's etf is down, russia, china, canada. any of the countries associated with commodities to the downside. generally risk off around the world and e tfs trading, for example, german stocks, japanese stocks, also down today and not as much as with the countries associated with commodities. emerging market stocks are weak, as well. seeing a down curve here and for example the emm. the major etf for emerging markets. mandy, back to you. >> thank you so much. well, there's a big speech in tampa, florida, tonight at the rnc but it's a speech tomorrow that probably means more for your money. fed chairman bernanke speaking to a conference in wyoming and everybody looking for clues what

he'll say. ahead of the speech, atlanta's fed president sat down with our own steve liesman to handicap the likelihood of more easing. let's welcome in steve liesman. all right, steve, you have been speaking with the movers and shakers out there so far. handicap the odds -- >> reporter: brian, brian? >> what? i didn't ask the question. >> reporter: just the movers and not the shakers. >> more shaking and movers. >> movers and then the shakers go. >> handicap the odds of hearing from just the movers apparently about the chances of ben bernanke saying qe3, dog gone it. >> reporter: well, we talked to dennis lock hart this morning, definitely a mover. unclear if he's a shaker. right in the center there. i think he said it was a very close call. but he did go on to say that there is some good. he feels the federal reserve could do for the economy. let's take a listen. >> rates could be lower and mortgage rates, for example,

could edge down enough to qualify some more borrowers. some more homeowners. i don't think the level of interest rates is the problem. that's what i hear when i talk to business people all the time. but i do think further stimulus if we were to put that in place would have some positive effect. >> now he did agree it was the data that's coming in that's very bad for policymakers right in the middle. look at the data that the fed has to wade through between now and the meeting on september 12th. it has ism manufacturing, construction spending and sales on tuesday next week. the ecb decision and the adp employment report on thursday. and then ism, nonmanufacturing, the friday report leading up to obviously the fed's decision on september 13th so the story about bernanke is he's going to go as far as he can, i think, in making a case for qe but he can't go that far with a lot of

data between now and the decision. >> do you feel that the effect of qe or the potential for further qe will actually have that much of an impact or is it diminishing here at this point? >> reporter: i think it depends on the amount of qe. but i think you're right, mandy, that there's a lot of skepticism in the market. low interest rates or high interest rates is not the problem. but they feel they can do some good. and whether or not -- this is the analysis of lockhart and other fed officials, as well. whether or not the benefits outweigh the costs is key decision. lockhart was not that concerned about the cost. he said that he believes they're manageable. i'm talking to other members out there who are concerned about the cost and think, you know, we don't have an inflation problem until we do. my guess on this thing or my idea is, listen, if it's a close call, probably shouldn't do it. qe is a very, very consequential

step. >> steve, i'm easily confused as we all know, right? and something you said in the first answer confused me again which is this. you were saying a tough spot on the data. almost all the data we have seen, major pieces of data haven't been great but slightly better or better than expectations. so what is it really that the fed is seeing that would even leave qe3 on the table at this point? >> reporter: so, the data is better on a subjective basis but objectively, brian, simply not good enough. think about where we are. we're doing 150,000 call it on jobs. what do we need and what should the economy be doing now to bring down the unemployment rate? 250,000, 300,000 for many, many months is warranted in that regard. we have upgraded gdp to like 1.7% in the second quarter. it should be north of 3% on an

inflation adjusted basis. we're lucky to do 2% in the third quarter. you're right. the data better than expected but nobody believes it's good enough. the fed is concerned. moving continuously on the second part of its mandate which is the employment part of the mandate and hitting more or less the inflation part of the mandate. >> now the important part of the interview, steve. talking to the movers and i believe shaking with a fishing rod s. that right? you have a big fish story? i hope it wasn't the one that got away. it is not. it's the one that you got. look that the. >> reporter: do you have a picture of tlit? >> yeah. >> reporter: my best outfit there. >> you look ten years young we are that. >> reporter: yeah, yeah. that's a large trout i caught in montana on my way down to jackson hole. and we got some big trout yesterday. look. i don't want to say i'm enjoying myself here too much but, you know, there's a lot of economic work to do. there's research papers to read. a lot of reporting but there was a little extra time there. >> had to add that disclaimer.

thank you, steve. >> reporter: exactly. thanks, steve. he will be interviewing one of another kind, philadelphia fed chairman charles plosser in two hours from now and a special section for the big summit on the website go. to jacksonhole.cnbc.com for the interviews and conversations on twitter, pictures of steve's fish, shaking moving, anything else. what does big men need to hear from big ben and want the hear from big ben? joining us is doug ramsey, director of research and david fleischer, president of first trust national resources. doug, i hope you heard the conversation with steve liesman saying that the data may be subjectively is okay. objectively, it is not good enough and that is why qe3 is still left on the table. would you agree with that? >> you know, i wouldn't. you know, i think -- i think the

tipping factor could be europe. and that bernanke may try to help our friends out in europe. i think certainly focusing on u.s. only economic data, i think it's hard to justify because, you know, obviously we have got high unemployment at 8.3% but employment growth is still 1.4% year over year and that's what the government sector cut impacted quite bit so if you had 1% per activity growth we are growing 2% to 2.5% year over year which is not great, certainly, for an early phase in the recovery but it is not a crisis. so i don't think he should be meddling. >> don't expect to indicate qe3 as jackson hole and if that is the case does the market go down significantly? >> you know, you distinguished of what do i want to see and what we will see. you know, i clearly don't think that the economy merits qe3 at this point. that being said, i think we are probably going to get it. in terms of market reaction,

what i'm concerned about short term is that, you know, there was an article in the journal a week ago calling this the most disrespected rally in recent memory. i think that was true during the early innings of it but it certainly has caught a lot of respect in terms of the sentiment measures that we watched in the last couple of weeks so i mean, our measures would say that people are expecting a lot out of draghi and out of ber nng so i think almost regardless of the news, the market is sort of set up to have a hope dashed. so i wouldn't be surprised -- >> david, duffel like you're being held hostage by the fed? >> interesting question. i suspect tomorrow the chairman will probably punt and buy time. he veal the microphone in a couple of weeks. he'll wait to see what the data really shows. i do agree with doug and many of your earlier sentiments. the data is mixed and for every negative aspect that we might be able to point out there are

positives. we see housing that's getting a little bit stronger. as a prime example and could be a driver so i think he'll punt tomorrow. are we held hostage? i think it's somewhat of a self-inflicted wound. i think investors should be wise not to hold their breath for a magic bullet. qe3, it might be an incremental step toward the recovery and not hold our breath as an element to the recovery. >> making decisions, david, do you factor in the fed or just do fundamental analysis and use the fed perhaps as a cherry on top? >> you know, the concept of asset aloe case is trying to weigh the data for an intermediate term decision and the direction of the fed, the impact of interest rates, you mentioned a little bit earlier when steve was on just that many businesses are not waiting for lower interest rates before they make decisions. interest rates are already at historical low as you know. there's the other factors, political environment that we have. doug pointed out europe.

there's some other factors, equally as important as the fed's decision that will ultimately drive greater investment and a greater traction to this recovery. >> indeed, doug, david, thank you very much for your thoughts, of course. only time will tell. we'll find out tomorrow. >> thank you. a market flash now with courtney. >> thank you. we have head lines across from reuters, reporting that the ceos of apple and google are talking to each other, having some phone conversations reportedly about some intellectual property disputes. we think that the conversations will continue over the coming weeks. at least according to what reuters is reporting. stocks little moved and if we can switch gears and talking about this, i have to note ciena reporting disappointing earnings and lower revenues than the street expected. brian? >> thank you. next, larry kudlow why he thinks republicans may be sending somewhat of a wrong

message. and mitt romney's veep took the stage with a rebuke of president obama. we fact check paul ryan's convention address and then later on the richest woman in the world is gina rhinehart and she shows us why the 99% hate the 1% in a very vocal way. how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea. try the #1 gastroenterologist recommended probiotic. align. align naturally helps maintain digestive balance. ♪ ooh, baby, can i do for you today? ♪

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well, tonight is the big finale of the republican national convention.

mitt romney takes the stage to accept the gop nomination for president and last night veep nominee paul ryan argued the case for team romney taking the obama white house to task on jobs and national debt. our eamon javers joins us to fact check ryan's speech, however. how did he score, eamon? >> reporter: hi, mandy. -a rousing speech but a couple of statements that paul ryan made last night are getting some scrutiny here on the day after. we 'll go through two of them here. take a look at the first one just now. >> right there at that plant, candidate obama said i believe that if our government is there to support you this plant will be here for another 100 years. that's what he said in 2008. that plant didn't last another year. >> reporter: ryan is talking about a gm plant in his hometown of janesville, wisconsin, but gm announced that the plant would seize production in june of 2008.

that's well before obama was sworn in as president. the team said that the comment was fair because obama said he would retool plants like the one in janesville and yet that is still closed. they say it's fair even though the last vehicle rolled off in december of 2008. about a month or so before obama was sworn in. here's the second sound bite to play from last night. this is paul ryan mentioning not by name but talking about the simpson-bowles commission. take a listen. >> he created a new bipartisan debt commission. they came back with a you are jetblue report. he thanked them. sent them on their way and then did exactly nothing. >> reporter: he sat on the commission and in the end he voted against implementing the findings that were in the report. he even wrote an op-ed detailing the objections to simpson-bowles in "usa today" but he is right in saying that the president

ignored the findings of his own debt commission. guys, and a lot of people think that that commission is going to be something along the lines of where we end up when republicans and democrats in this town do finally come together far debt deal. back to you. >> eamon javers thank you. when romney takes the stage tonight, what does he need to say to wow the crowd and more importantly win over undecided voters? let's go back to our team in tampa, larry kudlow and john harwo harwo harwood. larry, last night, paul ryan said something or didn't say something rather than had you upset on taxes and on the economy. >> well, i didn't think he made the case for growth. i thought he made a great case attacking obama's economy and obama care and defending medicare. but i did not hear a true growth message from a guy who knows all about growth. a couple of things. he never mentioned any tax cuts at all. that really disappointed me. and secondly, he talked about

briefly something called tax fairness. that bothers me. that is a left wing idea. that's president obama's idea. tax fairness means tax the rich. i don't really believe ryan believes that. somebody in the romney camp got that in to the speech. i think it was a huge mistake, sent the wrong signal and disappointed me and a lot of other conservatives that i've spoken to. >> larry, this is a really interesting time, right? i'm glad you raised the growth situation. mitt romney is a test tonight. a race that's too close to call. what do you think americans want from mitt tonight? do they want him to talk about growth to the extent that they want a president to get this country back on track and growing again in a strong way, or tonight do they want to know that he's someone to be comfortable with, they like the likability aspect? >> like sblt there. i happen to believe mitt romney is a likable guy. but whatever.

look. i think -- >> but a lot of people who criticized him for not being approachable and distant and not likable. you might think he's likable but a lot of people don't. >> that's a media thing that doesn't mat tore a whole hill of beans. what is going to matter is what you said at the beginning. what is the republican economic growth plan? on taxes, on regulations, on spending. they've got a pretty good press release this morning. i don't know if you saw it. this is from romney. they're talking about 20% tax cut. they're talking about a 25% corporate tax rate. they're talking about a regulatory cap on a federal agencies and they're talking about getting the keystone pipeline going. now, if romney gets that message out and says to people, i know things are bad, here's my program, here's my plan to make it better, he's in the race. this is the most important speech he's going to make for that very reason. i don't think paul ryan got that message out last night. in fact, i don't think the whole republican convention has really

gotten a growth message. we know the problem. but the republicans have not yet clearly defined the solution. >> okay. john, who's mitt romney speaking to? i have seen poll after poll that suggests the majority of the country already knows who they're going to vote for. who is the group mitt romney needs to sway? >> well, when you talk about when's tloeft move in this election, you may have somewhere between 5% to 10% of voter who is are genuinely undecided and say they're undecided and another 5% to 10% who may have taken sides but they're sper suedible. the voters to the extent that romney can move some of them, overwhelmingly white voters, most of them are women, especially college educated women. trying to get down the deficit that romney has with that group. to some degree hispanics. marco rubio will speak before romney and the campaign hopes it

helps him in a small measure but i disagree with larry. two things for mitt romney to do tonight. let people see him more and understand who he is more, see the personality qualities that ann romney talked about the other night and find a way to make the republican agenda somewhat more appealing. he's gotten very close. in fact, he's dead even to president obama on the strength of the difficulties in the country, the weakness of the economy. obama's record. all those things are positive but if you poll some of the stances that republicans have taken in the campaign, their stance on taxes that larry talked about, their stance on medicare, a majority of the american people side with the democrats. they've got figure out how to make the changes palatable and on the growth policies that larry talked about, mitt romney's been articulating the policies, the regulatory cap, the tax cuts since the beginning of the campaign. all that's part of the economic plan he laid out. he will certainly sketch through

elements of the agenda but i don't think the problem is laying out new measures necessarily in that way but figuring out how to link them to -- >> that's right. >> make people believe the economic problems. >> that's exactly -- i agree. you got to put all of these things, not 59 points but 3 or 4 or 5 points. romney has begun to do that. but look. you tell me, guys. 50 million, 60 million people may be watching him tonight and they want to know the solution is, what the solution is to the economic stagnation that we have got. i think the country knows that obama-nomics failed. i believe that. that's why obama is polling in the mid-40s but the country not made up the mind, particularly the groups that john mentioned, on whether mitt romney has the answers for economic growth. that's why this is such a gigantic speech for him tonight. >> yeah. i hope he uses the opportunity

wisely. gentlemen, thank you very much. make sure to watch john and larry tonight. our special coverage of mitt romney's address to the rnc, starts at 10:00 p.m. eastern time. make the popcorn. get a bottle of wine. sit down and watch it. easy to focus on the political squabbling, the fighting, right? back and forth. but let's not forget what america can accomplish when we work together. today, folks, the 28th anniversary of the very first launch of the space shuttle. it was the "discovery." it was nasa's third shuttle. it made the final landing last march and now on display at the smithsonian. that was the "discovery's" maiden launch. time to remember that we can do great things. >> yeah. if i'm not wrong, tomorrow, friday's a once in a how many years blue moon? >> very cool. >> coincide with the funeral, of course, of the -- >> not sure it was planned. >> well, no. >> but it's a very rare blue

moon. neil armstrong laid to rest tomorrow and it's a wink. >> wouldn't it be nice if the american government planned that? still ahead, the end of an era at one of the most storied retailers. next, live to louisiana where flooding of isaac is a major problem for rescue crews and the oil rigs and refineries and an update on that, next. merrill lynch has been built. today, our financial advisors lead from a new position of strength. together with bank of america, they have access to more resources than ever before. a steadfast commitment to help you achieve your financial goals in life. that's the power of the right advisor. that's merrill lynch.

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isaac knocked out power to half the homes and businesses in louisiana. the pictures really tell the story here, folks. from storm response to revere flooding around new orleans like plaquemines parish and that is exactly where we find our cnbc's scott cohn. scott, tell us the latest of the devastation in the area. >> reporter: after a storm like this, mandy, there's a whole bunch of impromptu engineering projects. that over there, looks like a hill. that's an earthen levee. behind sit the badly swollen mississippi river. workers are on top of the levee. come back to me here now. there's a flood wall and flood gate and we hind that another levee and a neighborhood currently filled with water with no place to dwochlt they have to try to get the water that's in

that neighborhood in to the mississippi river and that's the levee in plaquemines parish they've talked about breaching but it's a critical issue because they don't want the watch to go the wrong way. look at when's assembled here. what they're going to do is they're going to try and get a big earth moving piece of equipment back where i showed you through the flood gate and make a cut in the le view but it has to be a precision cut. they had to do some basically house to house search and rescue, bringing some residents back to try to salvage what they can because they're not exactly sure what's going to happen with the water when it rushes out of there. now, let me also quickly bring you up to date with the situation on refineries. because the longer it takes to get the refineries back up and running, more of upward pressure on prices. near as we can tell, there's no damage to refineries or offshore

platforms. we have seen some refineries here along the gulf coast. brian shactman was reporting. i saw some in st. bernard parish east of new orleans. they all seem to be intact but as you said half of louisiana is without power. that causes problems for the refineries and as we go back here real quickly and take a look at a helicopter going on, we'll watch this unfold as they try to continue to recover from tropical storm isaac. back to you. >> thank you very much. watching the national guard land there. scott, thank you. well, when we return, what sony's new ceo told cnbc about the plans to turn around the struggling company. we get a top analyst to weigh in on the costco stock. [ male announcer ] eligible for medicare?

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it is "street talk" time. stock number one. sears. shares lower. news today leaving the s&p 500 next week. >> you know, it is kind of sad in a way. >> it is. >> a member since 1950s. sears is public below the threshold -- stumbled right over

that one. 50% threshold. i will never live that down for a long time. eddie lam pert with a majority of the stock. it means index funds have to drop. sears holdings at one point, five of the biggest publicly traded companies in the world. >> end of an era. gap one of the biggest retail gainers, in fact, soaring this year in a comeback and nearly doubled so far this year. >> it has. excellent numbers for gap. 9% jump in same store sales. consensus for 5.4%. so it almost doubled that. seeing strong back to school sales. old navy, same store sales there, jumped 12 bucks. be careful. gap at 17 times forward earnings. i checked it out. that's about two to three points higher than peers on a pe basis. >> sony is one to watch, as well. in an interview with cnbc, the new ceo coming in earlier this year, he promised an aggressive and product-focused turnaround.

>> i don't speak fluent japan like you but he wants the focus on gaming and imaging and got a turnaround, the tv business and going after 26 and announced a waterproof tablet. sony needs to work on the names. >> yeah. it is a market leader in japan where they say -- like experience. >> a 25-year low. not a good experience for anybody. >> next up is amazon. kind of retail and tech today. sold out of the widely popular kindle fire tablets and not saying when they're going to be in stock. >> accounting for 22% of american tablet sales. as you noted, not sure when to be back in stock and important to amazon. cheaper than ipad, of course. next week big week for mobile. amazon with an airplane hangar and event space and speculation of what to roll out there. >> maybe some tablet devices. >> microsoft with an event next

week. >> in fact, a mobile boost thanks to samsung who was in the news earlier this week against apple. >> microsoft reference not accidental by the way. maybe a preemptive announcement of samsung. firsthand set maker of the latest microsoft software and this comes days before the nokia -- i think amazon's on the fifth and nokia and microsoft on the 6th of september. i might have flipped them. back to back, folks. next week is a giant week of rollouts. i had the nokia phone with the microsoft software on it. >> you were charging it up to show everybody. >> i left it at the desk. i forgot it. we'll see if the android ruling brings market share to the complex. >> okay. >> all right. let's bring in herb. herb wants to talk costco. costco -- >> i do? >> he thought he was going to talk about navistar. no. it's costco. >> a joke i hope. i'm easily startled like a

sheep. costco shares hitting all-time highs. the stock up over 18%. but as you might say, sir, on a stock basis, walmart and really target are beating costco over the past year. walmart is trouncing. do we have the comparison chart i requested, guys? much maligned? bribery allegations and walmart crushing costco. >> what was it doing? >> crushing them. get an analyst take and herb, as well. >> thank you. >> managing director of david schick joining us now. david, why is -- as much praise does krsto is, why isn't the stock doing well or better than wall start in. >> you're talking year to date. look at the multiyear. i mean, krcostco over time is a stea steady model. >> trading back to the all-time highs to the ipo in 1995.

>> yep. >> you stay you would still buy it. why? >> we do. if you think about the building blocks of the costco models it is a membership fee, that's the bulk of profitability and that's actually been accelerating. that comes from the value they provide to their shoppers. i'll come back to that. separately, the growth in the new markets and so as a large cap redaler, one of the very few mega cap global retailers, their box internationally at or above u.s. profitability and membership rates so they're growing their membership roll. they're growing the revenue line unlike kind of mega cap retail companies can. >> look, look. a lot of people like -- this is herb. people like costco as a stock. you're not the only one. it is a phenomenal executer. hard to get against the company. i put out crazy theory a little while ago suggesting that demographic shifts to affect them. looking at the stock and look at the sales growth and you look at

other key metrics going the wrong way, i think that's some concern too investors. other thing i want to point out here is that today the stock is up because we had the situation with the same store sales coming in better than expectations and when i go back and look, there's certainly growing at a slower rate than a year ago and sequentially down, as well. >> so, herb, i've looked at the comments on that. you know, the two-year stacked u.s. comp is as strong as it's been, you know, in two years. you have to sort of normalize for some of the noise with weather and holidays. you know, obviously, there can be some decel on a month or a quarter but the costco business model is built around 10% of gross margin compared to the rest of retail and then in to very high double digits for luxury so the point is as long as they're delivering that value, they're gaining share.

and two-year stack comp is as healthy as it's ever been so we think it's a very replicatible model. i hear you. there's noise that shows acceleration and deceleration but over time that's a core model of value is driving it. >> to reiterate, you have a price target of 100 bucks with a buy rating. thank you very much. we spoke to jan niffen saying that everyone should own costco. >> he may be right on one level and then i was thinking about this going back and forth with jan. he loves it so much, you know, cramer talks about how much to love a stock. is he blind to perhaps some of the other changes? i don't know. but i think we do again see the sales growth issues and paying attention to that. >> we got to go but keep in mind the ceo of costco respected in a lot of circles because of the way they treat the employees.

speaking at a republican national convention. just throwing it out. >> a phenomenal operator, costco. >> 72 gallon tub of mayonnaise. which american city has the nation's worst drivers? we'll tell you. the long good-bye to the gtl, yo. richest woman throws a class warfare grenade. she wants to stop being so jealous and she's an australian. here's today's "return on retirement." many americans are earning less than they did three years ago but boomers 55 to 64 years old have taken the biggest hit. in june 2009, their median household income nearly $62,000. so what is it now? the answer when we return.

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today's "return on retirement." what is the median household income for boomers? the answer, it is declined nearly 10% to just under $56,000. for more on retirement, go to retirement.cnbc.com. i'm bill griffith. at the top of the hour, first, following the pullback in the stock market. guiding you through the last hour of trading. plus, amazon's kindle fire taken nearly a quarter of the tablet market since it debuted last week and amazon said they're sold out. should apple be worried? plus, will the fed really take more action to stimulate the economy so close to the election? philly fed chairman joins us live from jackson hole coming up. and is it drama worthy of a

hollywood script? find out what's behind the "god father" film fight. i'm sure there's line of an offer you can't refuse. we'll see you at the top of the hour. back to you guys. >> bill, thank you so much. one of the wormd's richest women with a message of everyone with a beef with the rich. stop boozing, stop smoking and start working harder. well, as you can imagine, it really did hit a nerve, especially since she enhertzed her company and let's bring in robert frank. what do you make of this? i say, go, gina. >> she is the gift that keeps on giving. the mining heiress in australia, worth around $19 billion. and she's no stranger to controversy. she's in lots of lawsuits with her family over the family company. and, of course, she is regarded by many as the world's richest woman depending on how you measure it. she said in an op-ed piece that basically the tax that is are

too high, regulations too high and that basically the wealthy should not be attacked. she says those -- get that right up here. if you're jealous of those with more money, don't just sit there and complain. do something to make more money yourself. spend less time drinking or smoking or socializing and more time working and called far lower minimum wage in australia, lower taxes and less regulation. this didn't go over that well with the left. treasury secretary said it's an insult to millions of workers trying to feed their kids and pay the bills. i like going to the pub and worth $6 billion. now, this is sure to escalate what is now a global war of words of the wealthy. >> she singled out european economies, as well. saying australia risks the path of european economies with the socialist policies and of course we have a left-leaning government in australia, as well, right? >> yeah.

competition of china. the only billionaire born with a silver spoon and a foot in her mouth. i think she has a point. worriied about the national competitiveness and didn't help. >> a member of the lsc. >> thank you so much. >> do you know what that is? >> no, tell us tie lucky -- >> right. lucky sperm club. >> yes. there you go. >> born rich. >> the gift that keeps on gifting. i hope you'll tell us more. americans buying more and more expensive cars apparently. >> you won't believe how they're doing it increasingly. put it this way. could be a rough road ahead. chances are, you're not made of money, so don't overpay for motorcycle insurance.

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car loans used to be three, four, or five years long at most. now many are seven, eight, and nine years long. americans are choosing to stretch out their payments to make them lower. it's just shocking. a nine year car loan? you're going to owe more one of the car is worth nothing. >> that's what we see, people

stretching them out. this is an exclusive first look for what people are doing when it comes to auto loans. the average credit score has dropped down to the lowest average amount since 2008. how do people afford the more expensive loans? they're changing their payments. the big shot is in the six and even year loans. 58% of all new auto loans are five years in length. and the average payment is $452. take a look at the auto dealer stocks. most have had a pretty decent run, a few of them have fallen off, but generally speaking we're looking at people going in seeing i want to pay more and stretch it out further. >> what's the risk here? >> what's the risk?

>> how is the default rate? >> yeah, the default rate is low, and the repo rate is low, is that because we're looking at defaults from '08 and 09 from when people could not get car loan? now you're getting into that market more as the expands. >> scott, is this a good thing or bad thing? >> good afternoon, probably some of both. a lot of people are getting zero percent financing for 72 months. so it's almost impossible for them to be up side down. the average car is ten years old and has 150,000 miles. we're seeing a lot of pent up

demand and people trading in cars now that they have equity in. it isn't quite as bad as it looks. and the people selling these cars seem to stay in equity the whole way and they're paying their bills as you guys noted. auto delinquencies are down. >> scott, i have to take issue with one thing there. the average used car auto loan right now, the rate is 8.5%. and the average new car interest rate is well over 5%. so this 0% is out there, the result is a lot of people are not getting 0% loans. >> i think that is true as well, but the mississippi market cars, the camry, focus, they have 0% financing available, and most of the certified cars that are

nearly new. so i do see both sides of this since in another career i also do banking. sill, the people are paying their bills and they're not past due. >> who is the average customer for this auto loan? >> if you just picture middle america, people in ohio, iowa, or kansas, it's more of that time of person, they have a budget, they don't make a ton of money but they lived in their house a long time and the car is worn out and they need another car. >> what's -- speaking of that, what's selling? what's hot? >> what's hot is the middle market. ford fusion, camry, honda civic. prius a little bit. the real small cars are not selling all that well.

it's middle america, normal america, buying cars that they want. >> now we have gasoline prices treeping back up again, and this could possiblyly be due to you recollect isaac, but as they creep up, coyou think the smaller car segment or the more environment tally friendly segment will sell more? >> the prius is selling pretty well, but it's the smaller cars. smerk not quite ready for the really, really small cars. when you get out into some of the smaller towns in the country, the little cars don't sell all that well. there is a big market for hybrids. >> scott, that's always been the case, middle america is not the place to find a lot of mi mini coopers. >> yes, lots of lining my new york street.

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you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea. just a quick check back at plaquemines parish. they're about ready to open up one of the levees to ease the water pressure. when that happens we will try to show you live video. where are america's worst drivers, mandy? any idea? >> washington dc. >> you