will i just see better performance elsewhere are. to me these are operate proxies. my final trade, i'm just sitting on my hands. sometimes you just do nothing. >> and pick up volatility, july 6 coming >> all right that does it for us. "power lunch" starts now >> here is what is on the menu stocks sinking again, the dow dropping again where the bulls are finding safety supreme court striking a big blow to amazon and other online retailers when it comes to collecting sales tax winners and loser ahead. plus shares of olive gard garden's parent are soaring. is the revival for real? we'll debate today's all you can eat edition of pour"power lunch" starts rigt now. and welcome to "power lunch.

glad you could join us for a thursday major averages lower right now, headed near session lows the dow now down for an eighth straight day, that would be its longest losing streak since march of 2017. energy and industrials, those are the biggest losers right now. telecom, real estate, utilities, those are the leading groups in the s&p 500. gold continues to hit its lowest level of the year hovering around the 1270 level. >> and president trump holding a cabinet meeting just a short time ago focusing on immigration. first lady is also in texas to visit a detainment center for migrant children eamon javers has the latest. >> reporter: the president in the cabinet room talking with the leaders of this administration, going through a number of issues, talking specifically about immigration he is very critical in these remarks, it is about a half an hour of remarks here, very critical of sdemocrat, blaming

them for not being able to get anything done up on capitol hill very critical of mexico saying mexico is simply not doing anything for the united states, they are taking our money and sending us drugs the president says about mexico. also talking about melania trump the first lady who is now at the southern border visiting some of the border facilities which are housing unaccompanied children or children separated from their pthds. you see her there. she is near the u.s./mexico border and we're told by a spokesperson that it is not clear whether or not she knew the president was going to reverse course. she planned the trip earlier in e week did not necessarily know that he would reverse his policy so this is the first lady serving in effect as a sect zen secretary of compassion. and there then of course mick

mulvaney in that meeting with the cabinet just a few moments ago explaining the president's dramatic new proposal to reorganize the federal government creating a bureau of economic growth among other changes. so a lot at foot here at the white house. >> all right thank you. the dow is on pace for its eighth straight day of losses. the longest losing streak since march 2017 bob pisani is tracking it from the new york stock exchange. >> let's take a look at the s&p 500. different pattern today. remember we've had a pattern about the right first hour and then rally into the close. not happening today. we are going the other way and this is clearly tariff related take a look at the sectors industrials, materials weighing on the market and you also have energy we can ak as well we're seeing a lot of industrials hit new lows all of a sudden so you have kummins, general dynamic, is black and decker, ge, much of this somewhat

related to the tariff situation. the autos, we talked about daimler, that strange warning they had that duties on u.s.-built vehicles would hurt their earnings of course going from alabama to china. the duties haven't come in yet, but they't been confirmed yet, but they called it out. a lot of people thought that was strange. you see that effect on many car makers and finally, the market is very clearly saying that the united states is winning. so here we have for the quarter your top line is the small caps stocks in china, the white line. the orange is the russell 2,000. one is up about 11%. that is the russell 2,000.other down about 10% on the quarter. clearly the market is saying the small cap russell 2,000 is the place to be right now. back to you. >> thank you very much the dow down for an eighth straight day at least so far. trade fears front and center of course, how long will the slide continue and how can you protect yourself let's bring in ryan dietrich

with lpl and also chris constanose chris, you say you have been pulling back on risk for several months you have shaved 5 to 10 points off of your equity exposure. tell me why and tell me where you have been putting that money. >> sure. first of all, the why is not baud we're apocalyptic on the markets. it is simply because we have a risk management discipline that kicks in and it has kicked in a number of times between february and now. so we have kept the capital in cash because we expect at some point this summer to reinvest that it is short term capital laying around for more opportunities. >> and so it sounds like you ever somewhat mechanistic system that kicks in and causes you to do this. what were the triggers within

that system that told you, hey, it is time to reduce risk? >> it is purely based on technicals it is based on technicals and looking back through market history and seeing what our odds are three and six months forward from where we stand. and they are great because fundamentalist like me, i always believe what i'm saying and i would probably ride something into the ground. so i'm thankful that those technical things exist >> all right and let me ask you another thing. you were at the lowest equity levels in, what, how many years? >> a couple years in terms of our market data. again we're still somewhat pro risk and i expect once the midterm elections get behind the market, you know, we still think that growth is pretty good globally and we see decent values out there particularly outside the united states. but right now it is a time where your spidey sense needs to be

heightened >> so what do you see as a catalyst to break us out of the range? >> when you talk about the s&p up 3.5% for the year, but what is under the surface is what encourages us. we're more optimistic on the technicals small capsare breaking out the russell 2,000 up eight weeks in a row you look being at future returns, equities usually really do well. the risk-on things are leading under the surface so to us that is a good sign we think the zs&p and dow can play catchup and let's not forget the underlying fundamentals are still -- >> but we lean on these sectors for this entire year and have not yet hit new highs. so what makes you chk that at this point the leadership will continue and that all the other

laggards, including industrials, are basically at correction levels right now are actually going to play catch up in order to help the broader markets achieve new highs? >> slur. look at what happened last year. s&p gained 20% after 20% gains, you tend to see the s&p up about 2% to 3% at the end of may so in our opinion it is more of a consolidation first half of the year with the aggressiveare. fundamentals, lei leading economic index came out this morning, one of our favorite that is up 6.2% year over year our research has shown the odds of recession between efl to 12 8 months is 10% less >> so a lot of possibility probability. what about the small caps? do you chase those >> you you wouldn't chase them russell 2,000 up eight weeks in a row potentially. but the higher u.s. dollar, trade worries, tax reform, all those positive tail winds are

still there, so we'll have a pullback chris said, but the upward trend is still in play and we still like small caps >> all right gentlemen, appreciate it we leave it there. shares of amazon, wayfair are under pressure followed by a supreme court ruling >> this is a big one but the supreme court now says retailers should collect online sales tax from consumers when selling them goods online. even if the retailer does not have a physical presence in the buyer's state. so this is a reversal of the decision they made in 1992 over the same issue of course then online shopping wasn't a daily reality four justices including justice roberts agreed that they got it wrong 26 years ago, but dissenters say it is congress' job to fix it. implications largest for the smaller businesses because many aren't currently collecting sales tax for the online sales

when the buyer is in a state where the business doesn't have a physical presence. now it will have to do that. it is complicated for amazon because it does cleblgt sales tax on the items it sells, but over half of what is sold are sold by third party sellers, so they are not always collecting the sales tax. etsb, wayfair, you can see shares under pressure. but winners are big retailers like best buy, macy's, they have been fighting for years what they say is a more level playing field. they collect the sales tax, they follow the rule. they want everyone else to have to do it too and let's be honest, things have really changed since 1992 when talking about how commerce is done >> absolutely. courtney, thank you. so when the dust settles from today's ruling, will it level the playing field for brick and mortar retailer and internet giants? here with i think what is tellin the market is that the online

bricks and mortar retailers aren't really catching a huge bid on the back of this. i don't think that there there is a notion that it will level the playing field. >> that is because the game is over had they made this decision 25 years ago, it would have certainly slowed downs incursion into online because it was about an eight percentage point benefit. you were 8% cheaper if you were selling online than brick or mortar you would sell your mother for eight percentage points. so it is clear that it made a big difference as far as online penetration. but today it won't change the rate of penetration by very much overall the p all all the penetl continue i wouldn't want to be wayfair because suddenly they are 8% more expensive than the day before and they weren't making money to start with.

so that is a big problem >> wasn't one of the concerns that for the really small retailers, there are so many different setups in so many different states, so it would be difficult for the little people? >> that was certainly true in 1992 when they made this ruling and that is really why they made this ruling. and we fought it all the way but in fact today, somebody will put that app together in about 12 seconds so that you can collect the sales tax every place you need to. all the big guys already have that application in place. somebody will provide that to the small players. >> because there are local sales taxes as well as state >> and i guarantee you amazon will provide that in a in nain n nanoseco nanosecond >> and they wanted it to fight amazon >> and i said this is not a big disadvantage to amazon, but most online only players. amazon has already won the game

and they can play it technically better than anybody and they will sell that service so it will all work for them >> i'll ask a dumb question which is what i do best. explain to me this one of the objections that anti-tax people have is that this fundamentally would sanction a state to reach into the pockets of a resident of another state to extract taxes from them. why isn't the sales tax applied to the company in the state where the sale is made if i'm the new york retailer or the tennessee retailer who is selling to a person in new york, why am i clenlgting new york sales tax from that individual as opposed to paying the sales tax in tennessee >> you're paying the sales tax and you owe it if you are the consumer all these taxes, this $25 billion a year that is not being collected, it is owed as a use tax. >> by the consumer

>> right when you file your taxes every year, you sign that i've paid my use taxes and perjury on that m. the only difference is they are not collecting it. but you owe it >> it is up to the seller to collects it. >> it has always been up to the seller but if it was not collected, it was up to you to pay it as an individual and you just did not. >> this won't affect when i buy stuff in new york and ship to new jersey >> yes, ma'am. that is over >> that is all over. last question. in terms of the third party sellers on amazon, does it take away a price advantage they used to have? >> 8 percentage points absolutely >> so it is really hurting the small businesses potentially >> and more if they have to pay amazon to service it further >> all right thanks up next, team trump ramp eithering up the trade rhetoric. wilbur ross saying that the u.s. needs to create an environment of pain. is this the right declaration? we'll debate it.

plus intel ceo forced out, breach of company policy should the word haboard have boi for his consensual relationship th an employee power lunch will be right back ar so, what's new? we just switched to geico and got more. more? they've been saving folks money for over 75 years. a company you can trust. geico even helped us with homeners insurance.

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commerce secretary wilbur ross is averaging up the

kayla tausche has the eye raising comments that he made today. >> two weeks before a new set of tariffs on $34 billion in chinese goods takes effect, commerce secretary today on cnbc reaffirmed that the strategy ever raising tariffs on trading partners is to get them to cut theirs >> what we have to do is create an environment where it is more painful for these parties that have these huge trade barriers, both tariff and nontariff. got to make it more painful for them to keep those barriers than to get rid of them and that is what a lot of this exercise is all about. >> yesterday on capitol hill, ross acknowledged that the process ever exaof exacting pai causing heartburn here at home he referenced a drop in soybean prices which this week reached a nine week low.

he said soybean farmers said the surprise being exaggerated by speculation, but certainly a dramatic move in the last month. also this morning he was asked about reports that he shorted stock in a european shipping company last fall. but he maintained that he did so to offset a remaining stake that he held in the company called navigator holdings and denied that he shorted that stock in anticipation of a negative report forthcoming about that stake. >> all right thanks for that rundown. adding to wilbur's war of words, peter navarro penned an op-ed titled trump's tariffs are a defense against china's aggression so is this attack the right recipe to level the trade playing field? joining us now is sarah fagan and also jimmy i'm assuming not every viewer has read the op-ed, be he makute the indication that there is

forced technology transfer if you want to do business in china, you have to do a jv and then in that process intellectual property. and also they would get a national security advantage certainly r their defense department let's first talk about the premise and whether or not either of you disagree with any of those points before we get to is this the right way to go about it >> i think fundamentally the president is right about this. china has been ripping on off our technology for years and making it difficult particularly for our movie studios and technology companies to do business there in a fairway. however, the way the white house is going about this is having a very harmful effect on american consumers, raising steel prices, higher cost of washer and

dryers >> we'll get to that jimmy, do you have any issue with the premise of what he said >> if peter navarro is right, then we're doing it all wrong. what the united states should do is try stealing technology from other countries, other companies, force them to give it to us. apparently that ishe way to get rich that is what he is saying. he is saying that is how china has advanced that will help you to some degree, but ultimately if you were going to come up with your own technology, you have a lot of smart people that are entrepreneurs who have the freedom to create and profit and china is not going in that direction. they are turning to more of a marxist economy. and i don't think -- >> he is trying to effect change you don't think that will fundamentally be the way to wealth for china but how do you -- >> no. >> so let's move on to

methodology. how do you effect change >> listen, i don't think that you have these broad tariffs that kind of affect everybody whether they are playing by the rules or not what the united states should be do is being is going after companies that have stolen intellectual property, whether that means not letting u.s. companies sell them inputs they need, whether that is denying them access to the u.s. markets, f go after those bad companies the broad based tariffs, is as he once said bring me some is not the right way to go about it >> sounds like the president is doing some of the things jim any talked about we are prohibiting some companies to do sales. >> but we backed off >> but that is part of the methodology temperature does it seem like the white house thinks that is enough to get the chinese to change behavior >> clearly the white house as wilbur ross laid the strategy out for all the chinese to read,

you know, didn't think it is enough, but the challenge for the trump administration as jimmy pointed out, it is hurting everybody. and so rather than do a targeted approach in a much aggressive way to specific companies, using it in specific sort of negotiations with the chinese government one to one, we're doing it in a broad scale that very well may be hurting our economy. we'll see what the net effect of this is a couple months from now. but this is going to hurt politically for the president. when americans start to see their 401(k)s drop because we see sustained stock market drops. and companies that are heavily reliant on trade harmed. and i suspect that will happen if we get into a full blown trade war. right now there is a chance to walk it back >> jimmy, do we know enough about -- two questions do we know enough about the

individual companies that are the violators of our intellectual property to sanction them and them only, or are those companies so intertwined in many cases with the chinese government that effectively and equally effective way to do it is to address all the companies under the chinese umbrella and inflict pain thereby on the chinese government that is behind those bad actors. >> listen, in the past a lot of american companies have been reluctant to sort of make these cases because they fear being penalized by the chinese government and i think this is a new era. i think sthee hathey should havr confidence that the united states has their back. so i think this -- listen, we had a model ever us doing it which was zte. and then we backed off that model. i'm not sure that is what the president wants.

i think some might want that i think the president would be very happy ultimately, this is your end game, with a deal with china and i think this is part of a renegotiation that would be a smaller trade deficit and has tweetable deliverables and i think that is how this ends. >> the thing we have to remember is there are many more couplers in china than the united states. so ultimately we will be harmed more than they are >> all right thank you both good to have you on. intel ceo resigns after it was discovered that he had a consensual relationship with an employee is this the latest example of the "me too" movement in the board room with tripadvisor, finding your perfect hotel at the lowest price... is as easy as dates, deals, done! simply enter your destination and dates... and see all the hotels for your stay!

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to the bond market >> if you look up at the board, we are down four basis points. but on the two day, what went up came down. we're just gravitating and we remain basically in this range in the 290s. it is a little softer the last several sessions, but it continues to trade mostly unchanged. if you look at a two day of bunds, a similar scenario except for as it diminishes, maybe it was leaning as we came in our time zone what you of tbecause t

chart. of course they are not in favor of the euro and not big fans of brussels 20 basis points worth. finally, one week of the dollar index, rest of the currency spiked around 8:30 eastern, but the dollar index is circumventing the 95 level which isn't d considering three months ago it was at 88. >> thanks rick contessa brewer has an update >> a house minority leader nancy pelosi called on president trump to release a plan quickly to reunite undocumented children with their migrant parents >> the gop should have been in these bills immediately and demand the president rescind his policies at the border, policies he created and that he can fix

and not with that halfway measure yesterday. >> the trump administration's proposing a major reon organization of the federal government that plan includes merging the departments of he heducation an labor and moving the federal food stamp program for the department health and human services and renaming that agency residents and business owners began cleaning up after a storm dumped nearly 4 inches of rain on western pennsylvania at least one person was killed scores of people had to be evacuated. look at this video flooding so intense, some areas saw cars actually washed out of parking lots that is your update. back tyou. opec members gathering in vienna, it could reverse two years of lower production. brian sullivan has more. >> reporter: yeah, thank you very much. we're outsidthe opec headquarters here. certainly it could change the whole course of the last couple

years, here are a couple of headlines over today and yesterday. you might as well call it ropec because russia not an opec member, but they loom so large really no debate anymore about whether or not output will go up pretty much everyone agrees, it is a question of how much. india also looming large the dollar has gone up, gas prices have gone up, so indian consumers are frustrated let's talk more about what you think will happen which is what? >> well, like you said, there is very little doubt about what will happen in terms of barrels. somewhere within 100,000 barrels a day, 500,000 a day are coming on the market. saudi is going up, uae is going up, kuwait is going up, russia is going up. they are debating about what they will write in the communique because president trump is not here he motivated the saudis to send

a signal iranians said we don't want to be part of that. so they are debating whether to say production is going down >> do you think iran will cave yesterday their opec gernor said it is like trump walking away from the nuclear deal he compared the two. iran will have to compromise >> that is what people think and they are debating it right now. the iranian oil minister will have words to eat if he signs a statement tomorrow saying production is going up >> do you think he is willing to do that? >> i think he might be, but he will have to say i want you on to express solidarity with these sanctions. i want love from my brothers you may say i want our quota to go up as well. the question will he get it. >> all right we might as well just sleep here so guys back to you, here is the thing, opec suggested that september which is this boring technical meeting will now be a real meeting which means that could indicate iran will cave and they are giving it a couple

months to see how it plays out i guess it is kicking the oil can be down the road more drama tomorrow. >> we'll be waiting. longest day of the year, stay out late >> thank you intel's ceo resigns after it was discovered he had a relationship with an employee. a relationship that was against company policy the latest on this story and tuteinhemeans for inl t fure do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online. this endangered species is getting help from some unexpected friends. these zebra and antelope.

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ensuring that the public is going to be safer and that these forests can be sustained and enjoyed by the community in the future. fierce ofears of a trade wa continue to drag we're off session lows s&p 500 down by almost 13 or about half a percent telecom, utilities are top performing sectors right now industrials and energy the laggards >> and brian krzanich stepping down as ceo of intel after an internal investigation revealed a consensual relationship with an employee. josh lipton has the latest railroad >> reporter: we're here at intel headquarters the employees still processing the big news that intel has

removed ceo brian krzanich who had a consensual relationship with an employee, that violates company policy the cfo bob swann has been pointed interim ceo. and raising q 2 guide answer krzanich gets credit for a stock price that jumped about 120% under his watch. and that the company has his portfolio of chips that they say is positioned to try to capitalize on the new growth markets that we talk about but for now the street is more focused on the chips for servers. so who could replace crikrzanich one name so watch, intel's chief engineering officer. so he would be an exec well engaged in the growth markets like 5g and internet of things we've reached out to intel the company simply saying that the board has begun their

search back to you. >> thank you very much here to dig deeper on the potential ripple effects in board rooms across america, joanne lippman author of that is what she said. and also a brand leadership consultant, author of fusion, how integrating brand and culture powers the gatest companies. denise, this was a consensual relationship sounds like it was a pretty long time ago we presume it was an affair because he has been married for a long time. but the company says that is not the issue, it is that he shouldn't have been fraternizin with an employee regardless. let me ask you this. 20% of people who get married, they mayor i are oig somebody from work. have wgone too far here? >> this isn't a moral issue. this is a couple chur issulturee >> what is the difference?

>> the company is trying to set certain guideline, certain values that they want everyone to abide by. and as the ceo, you need to be the standard bearer. and if yyou violate them, you need to suffer the consequences. >> should she have been fired as well >> yes the policy should be applied universally. >> joanne, have we gone too far, has the world gone crazy do you know how many people work together here and gomarried? i don't everyone want to start >> you're sitting with one >> right >> i think that is awesome for you, tyler, but here is the thing. we have to separate this for a moment from "me too" and that movement >> this is not "me too." that was harassment. >> and secondly, we have to separate it fromthe entire sexual assault part in that this is a rule, he broke a rule and there are consequences if you break the rules. and whether that rule has to do with sharing information, with how you file your expense account or with office relationships, you do need to uphold the standards of the

rules. >> it was a long time ago we presume, right things have changed. i mean i would bet if intel started to go through everybody that happened to be dating at the time this event occurred, there would be a lot of people losing their job >> do we know that he had the relationship before the rule was in place that would be an entirely differe different situation. but the one thing everybody should pay attention to here is the idea that in technology, in silicon valley as in the finance industry, they are way, way, way behind in terms of issues of gender >> are you raising the possibility that this relationship began and ended at a time, and denise jump in as well, at a time where the rule may not have been in place >> we don't know >> one assumes the rule was in place at the time of the relationship

it would be very unfair to sort of post facto impose a penalty on a guy that was not violating a policy at the time >> then the situation would be different 37 but this is a highly visible 34r0i eand this is an opportunity, this is really -- this was a pivotal moment for intel's board and organization as a whole to make a statement about how strongly they had here to their values. >> i understands importance of applying the policy to the top person all the way down through the organization so what happens now? if i work at intel and i'm a manager and i'm dating someone who is not a manager, what do i do and what does the company do? >> well, i think you have to reexamine your relationship and move your behaviors in line with those guide lines and values >> i think you have to quit,

don't you? you already violated it. >> you should be fired according to their board and i guess -- >> my question -- >> isn't there is a gray area? is it always black and white, any violation of any company rule results in firing >> again i think there are consequences for violating rules. the shame of it is -- >> but is the consequence always firing the guy the guy who brought the stock price up by 120% while he was there. >> yes, but there are consequences for on breaking the rules. he would know and he is the qvc. so if you make exception ises with him, then you are on a slippery slope what we do know, he actually has been one of the great champions in silicon valley for gender equali equality >> that is separate.

>> it is separate, but i do think that it is worth pointing out that this is a man who three years ago in 2015 announced a $300 million program to try and increase diversity and diversity throughout the ranks, women as well as other underrepresented groups. and i think that is an issue that silicon valley is struggling with and it is hard to separate that out >> so i want to come back to melissa's point which is should anyone who is now involved in a fraternal relationship with a co-worker at intel be fired summarily? if that is what the policy says, you break this rule, you're out. >> yeah, i think they should be asked to leave probably given the option -- the opportunity to leave now but you know these guidelines are in place to reduce the risk in a companies have. and the board needs to fulfill

their responsibility to manage the risk of the organization so by enforcing this decision with the ceo and having that be visible to everyone else, the board has done a smart thing by making sure everyone knows clearly what is expected of them and therefore they are fulfilling their responsibility. >> isn't it hard to legislate against love >> again, this is not a moral issue. you know, frankly the ceo -- brian will be fine i think this will blow over for him professionally and he will go on and lead another company and be fine. but the long term effect at intel -- >> but that is not the point that he is going to be fine. >> it should be in theory he should not be fine if this is a violation enough to get him fired as ceo of intel, then it should not be -- he should not go on with his life and be -- >> it is purely symbolic >> exactly it didn't mean anything.

>> which has been the case with other exes have been in these relationships think about mark herd. >> now ceo of oracle, right. >> after having something similar happen at hp >> there needs to be opportunity for someone to be forgiven, to change their course, do something right. so i don't think -- that is what i mean by that he will be fine >> denise raises a point which is this is not a moral issue if the rules are flawed, it should be up to the board to change them. >> but the core of rules is some kind of morality the core of this rule is that the reason you don't want a manager dating sody within the company is perhaps they have some some kind of power over them, somehow they will affect their career right? so it is a moral issue quite frankly. the slicing and dicing of >> i also say it is a trust

issue. he has advisably broken the trust that the board has in him by violating this guideline. and that kind of trust specifically at the ceo level is very hard to regain. so i do think that at this points it is time for everyone to kind of move on and learn the lesson everyone in the organization understands where the board stands on their values and get a new leader in there who can start with a fresh slate and start building that trust again. >> a great point by the way. because presumably he knew he was breaking the rules, right? and that is why they are there if you do not pen althoualize t for on breaking the rules, you have a hard time with the rest your ganization >> thank you, ladies modern medicine, how one startup is disrupting the multibillion-dollar diabetes market using of all things food thera therapy.

we'll tell you how it works when we return.

a new systemly cew silicon woshling to fight diabetes >> and normally when we think about making inroads this disease, we think about new drugs. but this is a new approach taking the opposite approach take a look. an elite triathlete was shocked when he discovered that he was pre-diabetic >> i thought this is nuts. nobody can exercisrehan i do and you can't be leaner than i am >> reporter: he found success with the ketogenic diet. he spun his own experience into a new company called verta health it works with patients with

diabetes orwas dependent on insulin to control his blood sugar >> no more didiabetes. >> and now he works with a doctor and coach to change his change his eating habits >> all my life i've eaten what i wanted to eat. what i eventually found was that i was overeating. >> reporter: since he started almost a year ago, moore says he's lost more than 50 pounds and his blood sugar is under control, so much that he's been able to stop taking insulin. inkinen says 60% of patients reverse diabetes on this program. >> it's absolutely transformative results. >> reporter: with those results come cost savings. $9,600 on average in the first two years on drug and medical costs. the program costs $370 a month out of pocket unless it's covered by employees or insurers for geary moore, it's been worth it >> it saved my life.

so, what is your life worth? >> guys, they say their goal is to reverse diabetes in 100 million people by 2025 so, pretty modest goals there. >> meg, thank you. shares of darden restaurants soaring. chipotle preparing to unveil new items later today. that stock's up 60% this year. aesurt vival under way? stay tuned

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they're a perfect match. the new ipad and xfinity stream app. hey guys, i'm home! surprise! i got a puppy. add an ipad to select packages for just $5 a month for 24 months. upgrade online now. shares of darden restaurants surging on its earnings, beat the company raising its dividend almost 20% meanwhile, chipotle is getting ready to unveil new menu items later today. that stock is on a tear. are we seeing a restaurant revival? joining me now is a retail restaurant analyst rj, great to have you with us. i thought that rising gas prices would dent fast casual restaurants in particular. what's going on at dri that it can escape that sort of pressure >> yeah, if you lock back, i mean, the last couple years, i think darden and really olive

garden in particular, the largest brand, have been one of the most, you know, impressive turn around stories we've seen in the restaurant space in some time it's not any one factor you can look at. i think it's a combination of things they've simplified the operations, which has improved thspeed of service and order accuracy they figured out how to build a very successful takeout menu they figured out how to balance value, everyday value, with add-on orders and so you still have a low base price, which helps to offset some of the gas price increases but people come in and buy other things as well and then on top of that, they're starting to get another day part, such as lunchtime and late evening. and this has become the blueprint in the restaurant space. if you look at what chipotle's probably trying to accomplish over the next couple years, a lot of the same things we're going to hear from brian as the product introductions later today and the special call they'll have next week >> what do we know about the new products at cmg? >> yeah, not a lot yet, but i me mean, if you take a look at the test kitchen in new york, you get a couple hints

certainly they've been testing some new grains that you can incorporate with your bowls or burritos i think that's going to be parking lot of ipart of it. i wouldn't be surprised to see another protein optiin's what ty needs. >> what kind of protein? they have beef, po, right? they've got chicken. tofu what's left? >> yeah, i think probably some variations of those proteins, probably more than anything else i think it would be hard to introduce a completely new protein but a different way to prepare that so, potentially a different kind of beef or chicken that seems like the most logical thing. again, this is just speculation, but it seems like that would be the most logical thing, but it also doesn't disrupt the work process eerither. that's the key the speed of serce is something that the company is squarely focused on improving right now. >> you have hold ratings on both of these stocks. why aren't you believers at this point? >> well, with chipotle, i like a lot what brian nichols i bringing to the table and i wouldn't be a seller into next week's call.

i think there's going to be a lot of excitement coming with it but at the same time, i think there's a lot of investment that still needs to take place. you know, to improve the second make line, to improve the workforce training, introduce these new products, i think there's a lot of investment that still needs to take place and so i think that while, i mean, there's going to be a lot exciting coming from it, you have to balance that with some tempered margin expectations, namely olive garden, i think there's an intriguing capital allocation story, i think the c right and you'll continue to see the benefits as they roll out to other brands i just think it looks fairly valued at this point but for income investors, it's still worth a look at this point. >> rj, thanks. still ahead, at&t unveiling plans on how they're going to use all that content they acquired when they bought time warner plus the fight for fox, disney, and cnbc parent comcast going to to toe. media mergers, the skiennny bundle, all that and more on the

second hour of "power" right after this break

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since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities - trade confirmed - and i have global 4/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you. i'm tyler mathisen, welcome to the second hour of "power lunch" and here's what's on the menu the dow on pace for its eighth consecutive day of losses, trade troubles being blamed in part for that decline how long will this streak go on?

plus, the supreme court dealing a big blow to internet retailers when it comes to collecting sales tax is this a move to level the shopping playing field or simply government overreaching? and sour grapes. why california wineries are worried about a trade war and how it might affect sales to china's growing market of millennials. the ceo of one good wine, silver oak, will join us live the second hour of "power" will start right now. and welcome to "power lunch. i'm melissa lee. the dow is down by triple digits right now, 134 points to be exact. down by about 0.5% eighth straight day of losses there. it had been down more than 200 points at the session lows utilities and real estate, the best performing s&p sectors, the s&p down by 0.4% verizon, walmart, biggest gainers. southwest airlines, alaska air,

jetblue, they are leading the way. michelle thank you very much, michelle i'm michelle caruso-cabrera. melissa talked about it eight days in a row for the dow so let's begin with the markets bob pisani is down at the nyse >> we are ying to break is pattern today where we have been essentially moving towards the lows look at the s&p 500 here we're off them but remember what's happened the last five trading days we have moved towards the highs of the day as we closed. that's not quite happening today. this is tariff related i want to show you the major sectors hit by tariffs industrials, your materials, things like energy stocks, just in the last month or so, the s&p is flat up 1% maybe, but you see the declines here in energy stocks, industrial stocks, material names here, notably underperforming the rest of the s&p 500. who's winning this trade war the market seems to be clearly indicating that china's getting the shorter end of the stick here as the small cap index in the china down 14%, the quarter,

russell 2000 up 12%. that's a clear win for the united states right now. in terms of earnings, i want to point out we've had seven companies in the second quarter that have reported earnings and the numbers are astonishings 30% gain in earnings so far. revenues up 12%. this could beat the first quarter. guys, we were talking about peak earnings just a month ago. i don't think so second and third quarter that's why these tariffsave got people worried anything that hurts that is going to hurt these stocks here. the president's trade fight putting pressure on businesses but just how much of it is impacting corporate decision making jackie has the results >> let's start with what cfos are most worried about that is u.s. trade policy. not a surprise as tensions escalate with our trade partners and specifically china and they are expecting a negative impact on their businesses 45% of u.s. respondents and 66% from the asia pacific region said the impact will be negative but we also asked them to compare the benefits from tax

reform to the uncertainty from u.s. trade policy. 60% said the benefits of the tax reform would outweigh what could happen as a result of trade. we also wanted to know what they're going to do with their cash, 70% said share buybacks is the answer 15% of those indicated that the buybacks would be possible because of tax reform. finally on the stock market, about a third said the dow will fall under 23,000 before it would cross a new record of 27,000 almost 40% said they were unsure in previous quarters, tyler, they all thought we were going to go much higher. all major averages are down today with the dow off more than 200 points earlier, at least. is the selloff due to concerns about trade or something else? let's bring in quincy crosby and sandy, co-manager of the balanced fund. when bob pisani shows you it's down so much and the small caps in the united states are up so much, that would suggest people

are actually convinced that something's happening with trade when it comes to the tariffs quincy, are you investing or changing your allocation based on what's happening with trade >> well, yeah, i mean it's also part and parcel with the u.s. dollar >> i got to interrupt you. we got to go to the president who just spoke earlier this is about a minute long. he spoke on immigration. can you verify if we're going continue prosecuting families >> we have to have a very tough policy otherwise you have millions and millions of people pouring into our country. we can't have that we have no choice. we have to have a very strong border if we don't, you'll have millions and millions of people and look what's happening today, it will look like child's play it will be a terrible thing if we ever did that so we have to be very, very strong on the border if we don't do it, you will be inundated with people and you really won't have a country anymore. you know, without borders, you don't have a country i've saiit for a long time, and you would effectively not have a country okay thank you very much. thank you very much.

>> so you see president trump meeting there with governors, the pool camera was in there, he took one question on immigration. you just heard him let's bring in kayla tausche with what's going on on the hill related to potential legislation. >> reporter: michelle, as the president talks about the need for tough security at th border, the house floor currently is in the middle of a vote on a conservative bill on immigration. it's the first of two bills that was expected to be voted on today but we've learned the second bill, which is the compromise bill, it's a more moderate version of the immigration legislation, that has been delayed by leadership until tomorrow to give members more time to review it there was some confusion on the hill about exactly what was in it because of similarities in the names of the bills so, that second vote is not going to happen until tomorrow that's what we know. >> what exactly would these bills do >> reporter: well, the major difference between these bills, michelle, is that the more conservative bill does not offer

a path to citizenship for the dreamers where the moderate bill does there are many similarities with regard to border funding and the like the president has said he would sign off on either of them if the house could pass them and this morning, when speaker paul ryan was asked what they would do if neither of these bills passed, he said, let's cross that bridge if we come to it but he said that the president would sign either of these bills so he wanted to see which of them the house could potentially get enough republican votes to pass, though it is not expected that either will. we'll see. >> thank you, kayla. kayla tausche on washington, d.c., on immigration, but you know, she normally covers trade for us which is what we were talking about. how is that affecting your asset allocation, if at all? >> well, it certainly has. it's just given more of a catalyst for small and mid cap because they were getting inflows first because they are the best beneficiaries for the tax cuts it comes directly to their bottom line. and we always like the financials in small and mid cap

because they are the ones that are the beneficiaries of deregulation so that is a big space in small and mid cap, and then as the u.s. dollar started to rise, along with better economic data, the fed, small and mid cap became a beneficiary then, add the trade, then that is the trade everyone seems to be in. money goes to where it has always best treated until it isn't. >> sandy, should you chase that trade? >> yeah, i think you will. i mean, basically f y, the peum always swings too far in both directions i think the gap gets even bigger by the end of 2018 so we want to stay long on small caps >> isn't valuation a concern at some point large caps have their earnings estimates revised higher by almost 10% small caps had their earnings estimates revised by 5% higher at the same time so at some point you got to look at the fundamentals and say their sales aren't necessarily going to expand just because large caps are going to get penalized. >> right so i would say that small caps,

not all small caps are created equal. look at the russell 2000 growth. we want to be a stock picker >> and go value. >> value >> well, and look at some of the areas that do go much better than the large cap brethren. you've got some of the, again, financials, which is a big, big portion of small and mid cap doing much better than the large cap banks. that is going to continue r a little bit longer, but again, this will swing. if you start getting the dollar weakening, some easing of the trade tensions, i think money is going to go back up into the industrials, which are now lagging, and all of the pockets of the big s&p 500 names that are lagging. this market has been balanced so we don't think it's going to be forever. >> sandy, what do you -- are you taking money out of big caps are you saying avoid that famous nifty fifty and all that >> we've been more small cap oriented we're going to continue to buy

any small caps on dips if trade war creates uncertainty, which it does >> what about the semiconductor sector we hear about it being affected by tariffs >> it appears around 19 times and it's a pure play on internet of things as well as electric vehicles so we think their end markets -- >> how do you separate those and say they're not going to be impacted by trade even though it's widely believed that semis will be affected by trade? versus a large cap which may trade at 13 times and you could say the same thing >> cybers will be somewhat impacted it's baked into the valuation here >> large cap tech is actually doing better than its small cap brethren and i think that continues until you see a pause there as well, which you're probably going to get. but there's always the a place to go, regardless of the headline and that's the beauty of our markets >> fantastic good to have you on. >> thank you >> sandy and quincy. well, brian is out as ceo of intel because of a relationship he had with an employee.

jon fortt is here with the fallout. what do we know about the situation? what do qwe know about what he' getting paid >> we know very little about what he's getting paid, just that this was a violation of the n nonfrat earnization policy intel is in this odd space of transitioning away from being a pc and server centric company into this vision that krzanich was trying to articulate around things like the technology its takes to power driverless cars right now, even though the results that the company previewed along with this resignation news looked good, i think the concern for investors longer term is going to be, who are they going to bring in as ceo who can bring all these disparate parts together and also think in a smart way about intel's core business of pc and server chips and the process technology that it takes to

continue to be on the leading edge of those. there's some concerns that intel had sort of fallen behind on process technology or at least on the cadence that they had, tick tock, whether you would shift the design and then they would shift the manufacturing in a way that kept them ahead >> do we know about this woman, where she fell in the hierarchy of the company i assume she will also be out, even though i haven't seen anything official. >> if she's still there. >> would she be meaningful in any way to the company they haven't released many details. >> they have not released any details. intel said to me they had said all they had to say right now. i'm continuing to try to get more information >> is the acting ceo, the cfo in the running to become the permanent ceo? >> he's a relatively new cfo he's only been in the cfo seat for roughly three quarters, i believe, three quarters to a year his predecessor, stacy smith, is one who would have been considered, i believe, but

instead of taking another high-ranking position at intel, he left intel when he -- when his pred sos sorecessor was nams cfo. when brian krzanich came in, he came in with renee james, who was another well respected gineer she came in as president it was sfoes spoesupposed to be one deal she left >> how many ceos in silicon valley are a little nervous at the moment >> you know -- >> she asked rhetorically. >> maybe a lot this is one i personally having talked to krzanich quite a few times could not have seen coming but you never know >> thank you, john jon fortt. coming up, at&t launching a new skinny bundle. your next guest says that's nice for consumers but won't do much for the company. he also says at&t paid too much for time warner. industry insider tom rogers joins us with more on that and what he thinks is next in the bidding war for fox.

plus the supreme court ruling that states can force online retailers to collect sales taxes. what it means for the future of retail and u.s. wine makers worried about a trade war with cna the ceo of silver oajos k inus with the impact on his business. you're watching "power lunch" on cnbc, first in business worldwide.

welcome back to cnbc a kprecomprehensive immigrationl put forward by the conservative

wing of house republicans has failed on the house floor. there were 193 votes in favor of it but 231 votes against it, including 41 republicans tomorrow, there will be a vote on a compromise bill that is very similar to this bill but does include an eventual pathway to citizenship for the dreamers, but this conservative version of the comprehensive immigration bill has failed as expected. back to you. >> all right, kayla, thank you very much. at&t wasting no time trying to monetize its mega merger with time warner, the company unveiling a new so-called skinny bundle, two wireless plans that include a new video streaming service called watchtv the service will offer over 30 live channels, no sports or local news, though so could cord cutting services like this disrupt the television industry joining us now is former nbc cable president. tom, always good to see you. i guess my quick thought is, is

this all there is coming out of at&t and time warner i can't believe that this is anything other than just a first little tiny step >> well, it's a great question and so far, everything they've said about this transaction sounds like it's about bundling content, but when you dissect what bundling content means, it means discounting content, and this is an example of that discounting. now, this is a great thing for consumers, consumer choice, sports in the bundle, the cable and satellite bundle has always been blamed for inflating the price of those bundles for all kinds of viewers who aren't interested in sports, and it's always been very difficult for distributors to get sports out of those bundles, because the leverage those companies have, so finally being able to have some bundles out there that don't have sports in it, certainly will be attractive to some consumers but they won't be the only ones

doing this >> maybe -- maybe you understand something i don't, and about this particular offer, and that is, who can get it and on what devices? in other words, it's for new wireless plans -- it's part of a new wireless plan.es this mean have a wireless device to access and download the content or can i watch it on my tv screen in my family room >> i think they're saying it will be available on roku and apple tv and -- but you need to be a wireless customer, i believe, to get the free service. it will be available to those who are not at&t wireless subscribers on $15 a month, i think they said. but the bottom line here is, it may be good for consumers, but you know, the whole issue with the at&t transaction is, geez, they won that court case, but you better -- you better worry a

bit what you hope for, because i'm not sure that this transaction, which they announced 18 months ago, if they knew how their wireless business and wireline business and directv business were all declining, that the answer to that was going to be linear television channels, which are also declining and how you put those together and further discount wn have th there with youtube tv, which is another skinny bundle, and the ability to put together advanced advertising solutions, i think, that will run circles around anybody else, it's very hard to see with what amounted to with data close to $125 billion transaction, and a $500 billion enterprise value at&t combining debt and equity, how something like this is really going to move the needle. >> put you one in the skeptical column, then, tom. let's transition to disney, fox,

and comcast. how do you see it playing out? what's the next move here for mr. roberts of comcast of course they're our parent company. >> well, whether or not he goes forward with another bid for the broader fox assets, i think, is an open question in my mind, the real lever that comcast has is the independent bid for sky. the -- i think the -- that asset fits much better with comcast than disney. disney doesn't know anything about truck roll, satellite dishes, settop boxes and all the issues of running such a business i think it's more important to comcast because they're kind of in a domestic box and this would give them an international platform but if brian raises the bid on sky, it's already got about a $32 billion market cap, $35 billion to $45 billion bid

for sky could leave disney in a position of having to add another $24 billion if it was going to buy that on top of the $70 billion for the fox assets, and you're really talking about almost half of the total consideration from disney being tied up in a satellite asset where satellite assetse directv, like dish, are declining heavily in the united states and they not really have the management expertise to deal with that. so i think that's brian's -- probably his best lever. if disney were to win, then, the fox assets and be stuck within a minority position within sky, that has $16 billion or more of their money tied up in it, then that ges brian quite a lot of leverage for some kind of negotiation. now, obviously -- >> to get sky, in other words. to get sky >> well, not only to get sky but to negotiate the other pieces of the transaction in terms of disney finding its way out of a minority position in the sky

asset with a lot of money tied up where presumably they wouldn't want to have that kind of passive interest in comcast control. so i think that's probably the avenue which we really haven't seen yet begin to play out as heavily as i think it will >> tom rogers of wind view, thank you very much. always good to see you >> thanks for having me. great to see you coming up, why u.s. wine makers are worried about china's millennials. ceo of silver oak cellars with the answer ahead and why -- look at this -- a mascot with a hot dog canon can backfire one phillies fan found out the hard way that story is next with the new chase ink business unlimited card i get unlimited 1.5% cash back. it's so simple, i don't even have to think about it. so i think about mouthfeel.

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welcome back to "power lunch," everybody. an unfortunate turn of events for one fan at a phillies game last night the philly fanatic is known for shooting hot dogs intohe stands at every home game, with a specifically designed canon. there it is right there. that's the can nnon right there. his aim was off and he hit a fan so hard she had to be taken to the hospital she suffered a black eye but no permanent damage, thankfully

goodness oh my. she says she's not planning to take any legal action. they should give her free tickets for the rest of the year >> i think they did. free tickets to any game she wanted, which is the least they could do >> one of the biggest cannons i've ever seen >> it's a very large cannon. states can now force online retailers to collect sales tax li rainemeans for the future of onneetl xt anncr: as you grow ol, your brain naturally begins to change which may cause trouble with recall. - learning from him is great... when i can keep up! - anncr: thankfully, prevagen helps your brain and improves memory. - dad's got all the answers. - anncr: prevagen is now the number-one-selling brain health supplement in drug stores nationwide. - she outsmarts me every single time. - checkmate! you wanna play again? - anncr: prevagen. healthier brain. better life. theextreme risk of burstd a pipes and water damage...y... soon, insurance companies won't pay for damages.

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i'm contessa brewer. melania trump makes a surprise visit to a texas facility. the first lady's visit comes a day after president trump signed an executive order halting the practice of separating families detained at the border >> i'm here to learn about your facility and -- which i know you house children on a long-term basis. and i also like to ask you how i can help to these children to reunite with their families. as quickly as possible

nato secretary general jeremy stultenburg said he was looking forward to welcoming president trump at july's nato summit in a speech in london, he said the transatlantic alliance had been, quote, shaken by president trump's america first stance but then he went on to express confidence the group would be preserved. a rare medicinal flower that only blooms once a year is now blooming in india. the flowers are native to the himalayas and are considered to have great medicinal value as religious symbols as well but they're under pressure, rampant harvesting, apparently, they only grow at 14,000 feet really remarkable. >> very cool stuff, thank you. let's get you a check on the markets right now. dow jones industrial average lower by about 147 points. it's a decline of 0.66%. the s&p 500 is also off by about

22 i said 12. i need new contacts. 12 points. melissa, over to you the oil market closing for the day. let's get to jackie at the cnbc commodities desk >> crude prices sticking near $65 and $75 for wti and brepres brent respectively the members of peck can't agree so right now it's all speculation. if it's a half a million barrels a day, that's baked in if it's nothing because they can't agree or don't think they need to add anything back right now, you'll see prices recoup some of their losses remember, wti is down almost 9% in the last month alone on anticipation of this meeting trade war fears very much on investors' finds, so where are the best opportunities for your money.

mark, great to have you with us. >> thanks for having me on today. >> why are you more bullish on china? that stock market's performance has been a disaster, especially in recent weeks. >> it's definitely been difficult in the recent weeks and i'm a value guy at my core so i like to buy what's on sale. couple reasons to be excited about chinese equities one, msci last june, a year ago, included them in their indexes so as of june 1st this year, every portfolio manager on the planet has to start buying a shares so a small percentage to begin but over the next 20 years, that number will grow and secondly, just the growth in china is really spectacular. we were talking to one of our private equity funds yesterday and the growth recovery in business, average business growing 30% plus year over year so we're excited about that growth and think it will be coming -- >> so what kinds of stocks are you looking at and i ask this because most

investors out there will probably think of china, they think of the fsi, but most are mostly state-owned enterprises so they're the banks in china, the oil companies in china, and they may not necessarily be what you're saying to buy >> no, such an important point, and really important for investors to think about owning what they want to own. fxi really is mostly state-owned enterprises, over levered, old economy companies. the three areas you want to focus on are consumer, health care, and technology i think the best way to play that is actually in the a-share market there's an etf out there, ashr, there's actually an interesting active adf, aad arer -- >> can you ask you, mark, what are you owning there mainland, hong kong? it's been difficult for the average american to do anything over there >> really important point. so, ashr is the mainland

that is the local listed shares, and that's where you're going to have the big tail wind as global investors now are forced to buy those shares into their indexed funds and their active funds if you want to buy hong kong, you can go ewh and we like hong kong here. we think it's gotten beat up overzealously and is pretty chief but fxi has too much of the old economy. consumer technology, health care, those are the plays for china right now. >> are you worried about trade friction stepping on this hypothesis >> no, not at all. in fact, the more they talk about these trade wars, the better the opportunity is going to be for china. look, i have this hashtag on twitter, #chinaplayinggo, and they are playing a different game than the rest of us they think in 30-year increments actiar're being very they're two steps ahead of us on these trade negotiations there was a great picture that went viral on the internet a

couple weeks ago showing a picture from the 1930s where you had all the young guys from the united states and all the old people from china, and then thi, it was all the old people from the united states and all the young people from china. they're just playing at a different level and we're very excited about how far ahead of the game they are. >> i get -- i understand that thesis and i understand the long-term view on this, but you take a look at -- that's down 17% this year. shanghai ashrs, they're down this year. how long do you wait for that thesis to play out as we're seeing these declines and further accelerated to tyler's point by trade fears >> yeah, yeah, so we have been accumulating here over the last few weeks, and we think looking forward, right, because that's what we're doing here, talking about the future, looking forward, we think that market will outperform the u.s. pretty dramatically over the next 12, 24, 36 months. >> mark, interesting thoughts and ideas,mark yusko

>> thanks. well, the supreme court today paving the way for sales tax on e-commerce even if the retailer doesn't have a physical presence in the buyer's state. does this level the playing field or is it fundamentally taxation without representation. let's bring in tom mcgee and veronigue. veronique, let me start with you. you think this is bad policy, a bad decision, and is sort of the camel's nose under the tent here explain what you see downstream as a potential of this decision. >> well, what i see very clearly is uncertainty and litigation, because what this ruling has done is certainly not to define any standards for taxation over the internet and it certainly is not a green light for states to start taxing however they want online retail or force out of

state sellers to collect taxes for them gets rid of the one clear signal we had, which was the nexus one. the nexus, the physical presence as a center, and because it didn't go ahead and tell us, you know, what the threshold was or what the new rule was, and all of this is going to have to be litigated, and while we had a clear rule before, we don't have it, but i think it's a mistake for people to understand this as saying that this is go ahead, green light, you can force out of state companies to collect taxes. and by the way, this is a good thing, because i actually think it is problematic to have an out-of-state company being forced to do the bidding for a state government, and by the way, i'm also worried about down the road what this principle does at the level of international taxes, because

that's what the european wants to do with us. >> tom, i assume -- veronique gave us a lot to think about there, and i assume you disagree largely with what she says explain, if i'm correct, why and is she correct that this will lead to litigation, or does it inevably lead to legislation >> well, we're thrilled with today's decision we think it's a victory for free market principles. you know, fundamentally, retailers, physical retailers, and online retailers, were operating in an uneven playing field and the supreme court leveled the playing field. we do think that the south dakota law is a good one, that it creates appropriate safeguards for small businesses. we would encourage states to follow those principles and i do think you will see, coming out of this, a number of states using today's ruling in the south dakota piece of legislation as a framework to adopt similar laws, which we would encourage.

i think this is fundamentally a victory for free market principles and just levels the playing field, which is consistent with what you do in a capitalistic society >> but do you get veronique's point about the whole issue of federalism, that a state is reaching across state lines? it could be problematic, right >> well, i think there was alady inappropriate federal intervention, because they created an inequity in the nation's sales tax collection system, number one number two, this is really just requiring and facilitating the collection of the sales tax that's already due you know, use taxes are required on purchases this just facilitates the collection sall it simply does is create a level playing field. >> veronique, you're answer. >> if we define -- if we redefine free market as meaning the end of tax competition and higher taxes, sure i mean, tom is right but this is not what it actually means. and by the way, a level playing

field, they had in the states, because you have, you know, you have a sales tax for the purchase that you buy -- you buy in the states but also consumers whoboy online are subjected to your user -- to the user tax, which -- and this, to me, is fine tell the people inside your state what kind of rule -- tax rules that they are subjected to there was a playing field. now, people didn't necessarily file their -- their user tax but it doesn't mean that it gives the right to the states to reach across state lines, especially -- i mean, everyone is thinking about amazon, but amazon is already -- has a nexus everywhere where there's a sales tax and was collecting sales tax. what we're really talking about is small businesses and while it is true that the south dakota won a first protection for small businesses, the ruling, if my understanding is correct, doesn't say that everyone can do

what south dakota do -- does, and i think -- and there's all these uncertainty. we don't know what a small means, how -- what is too small, what's threshold >> we're short on time, folks. tom, a final thought, quickly. >> i think from a pragmatic standpoint, states will look to today's ruling and the south dakota piece of legislation as a guide and a framework to create their own legislation. i think it's just consistent with free market principles. >> tom mcgee, and veronique, thank you very much. we appreciate your time today, and for a vigorous discussion. appreciate it. still ahead, why the glass is half empty for wine makers when it comes to trade turmoil we'll hear frothceofm e o silver oak, who joins us next, live

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trade dispute continues to heat up between china and the united states. the american wine industry is caught somewhere in the cross hairs. the chinese slapped a 25% tariff on wine in response to american tariffs on steel and aluminum. u.s. wine makers still be able to make an impact in the chinese market or will the whole thing die on the vine? oh, that's nice. that's nice right there. david duncan is president and

ceo of silver oak cellars in california, one of my favorite reds, by the way congratulations on a wonderful product. >> thank you >> how big is the wine business's -- american wine business' slice in china >> so to put it into perspective a little bit, the imported wine into china from the u.s. and california, in particular, is about $82 million a year >> a drop in the barrel. >> in the domestic industry is about $62 billion. so, it is, you know -- but it is a giant market with a lot of -- >> and a growing one >> and a growing market. so it is something that is of interest to producers, certainly from california. >> are the tariffs imposed yet is this just a threat? have you shipped anything and actually see customs, duties put on them. >> they are from the importer so they would have to collect the tariffs. so, you know, i think we are seeing some effect from that we're in between cycles right now for our own brand, but we definitely will see that >> you anticipate the next time you sell, the person on the

other end buying there is going to have to pay an import doubt -- duty on your product >> i think we're impacted a little less because we're a luxury wine so -- >> you're expensive anyway >> we are kind of expensive anyway, so if people want the wine, the 25% tariff may or may not impact -- >> what is your biggest export market >> so, canada, japan, england. we actually sell wine into 48 different countries now. china, you know, being one of them >> so as you take a look at the trade dispute sort of intensify around the world with even our closest trading partners, are you concerned that this will sort of spill over and there will be a broader impact on you? >> well, one of the things that, you know, i really believe is that we are living in a global economy and so it's difficult to think that, you know, this makes a difference on wine i also like to think of, you know, wine was actually probably the first trade that we had in america, because if you think about it, thomas jefferson bringing wine over from france and -- in those days so it was one of the first trade

commodities that there was >> who's drinking more wine in america these days >> even in the industry is talking about the millennials and excited about the millennials but of course, you know, our customers remain the baby boomers, the genx a the millennials. we see that in china as well there's a large population of -- >> i was -- in my notes, it says that 42% of the wine drunk in the united states was drunk by drunk millennials -- by millennials. was drunk by millennials >> yeah, a i mea i mean, i thin seeing that flight quality, if you will, and whether it's in food or wine or spirits or beers, and so we're really seeing that, you know, millennials are embracing that they grew up with wine on their tables their parents had wine for special occasions, and so, you know, they're really embracing that and i think we're seeing that in lots of different segments >> they're not buying ripple at 7 eleven >> definitely not. >> do you change the way you market i don't want to say the way you produce wine, but do you think about what millennials want to

drink? you want to capture that market and therefore you give them this product. >> we've been in business almost 50 years so we really work at making consistent product. we have changed like the way we've engaged on social media, how -- your experience in the tasting room we're very welcoming and sort of no pretension, no expectations and you know, we want to help people learn about wine and love it and we also just completed building a brand-new winery up in the alexander valley in sonoma county and we're very excited about that it will be really the most sustainably constructed winery in the world we haven't got our certifications yet, but they're coming millennials care about that. >> 2017 was a rough year in your part of the world with the wildfires. how was your -- were you affected and how was the vintage, 2017? are you hopeful? >> from a vintage standpoint, it was really a great vintage and for us, we were completely picked before the fire started so i would say there's absolutely no impact and you know, during the fires themselves, there was definitely impact to the valley but if you

came and visited now, you would never even know. and there are areas, but we encourage people to come and visit napa and sonoma. >> lovely place to be. david duncan of silver oak energy coming up, energy do today, but tracking for the best quarter if four years. where does it go from here trading nation's next. ed tradin. but with everything out there, how do you know what to buy? well, i think my friend victor has just the thing for you. check this out, td ameritrade makes it easier to find the investments that might be right for you. like our etf comparison tool it lets you see how etfs measure up to one another. analyst ratings and past performance... nice. td ameritrade also offers access to coaches and a full education curriculum to help you improve your skills. that is cool. and if you still have any qutions you caalways chat with us on facebook or call our experienced service team, 24/7. yep. just because you're doing it yourself doesn't mean you're on your own.

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time for trading nation, it's down 2% ahead of the meeting in vienna. mark, you have been bullish on the space. do you still like it >> still high conviction overweight oil's 10% off its peak price, but it's still up 50% year over year over the last year, the xle's up 15%. the energy stock eventually has to catch up to the rally in oil prices, even if there's a short term pullback. right now, it's a period of loose fiscal and tightening monetary policy, especially with the feds pulling forward a rate hike, and in the last five periods like this in history, energy has been the best performing sector, so pricing

power is strong. margins are expanding, and if you're really concerned about, you know, the change in oil prices, stick with the servicers that are not as impacted by price points you know, they are really going to benefit from rising price and reduce costs >> matt, how does the chart look on the etf >> looks quite good. pulling back a little bit here, but only pulling back from an erught condition that's really no surprise. what mark says is spot on. this group lagged so badly you don't need a big rally in crude oil for this group to play catchup. key level to watch is the $78 level on the xle that's the level that stock rallies in late 2016 and twice this year. finally breaks above the level, it gives it a very important higher high and take it above an semitriangle pattern which is

bullish. that's particularly good because xle broke above the trend line above 2014 break above 78 creating momentum for the group and helps it outperform by quite a bit second half of the year >> technical viewpoint, both bullish today. thanks, guys >> do you want more? go to tradingnation.cnbc.com and follow us on twitte twitter @tradingnation don't move, a clue on what we're talking about right now. a double bottom is a chart pattern suggests the trend is ending and ready to reverse. called a w formation because it looks like a w ic fm le bottom forms when presortwo lows on a chart around the same level. traders view a break at e highest high in the formation as a bullish signal whoooo.

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check, please. >> my check please, latest of sesame street. breaking news related to apple and sesame workshop, so i told my favorite joke my favorite joke started the year it was formed >> that's a big buildup, go ahead. >> bert, why do you have a banana in your ear ernie said i'm trying to keep

the alligators off the show. there are none you see, it's working. >> wow >> you're laughing, thank you. >> i think that's pretty funny actually >> we replayed it because guess who replied to me on twitter >> who >> ernie take a look. he tweeted at me saying, hey there, michelle, that's a good impression of me, my banana phone is still keeping the alligators away. he, he, he >> that's very funny >> that is very cool >> that is nice. >> hashtag you know you made it when - >> he retweets larry kudlow is going back to work on monday >> yeah! >> this was confirmed from washington we are happy that larry's recooperation is moving swiftly after suffering a mild heart attack a couple weeks ago. go, larry. >> all the hawks in the administration, puts them in their place. >> i got a haircut, he told me i needed a trim.

i was listening to you, larry. also, if brian is out after a relationship violated company policy there's been a turn around and transformation will the next guy or girl be able to continue the transformation that's the question investors have now with the stock down 2%. thanks for watching "power", and "closing bell" starts right now. ♪ it's time for the "closing bell, " everyone, on the floor of the new york stock exchange, netflix at a new high and whether the fang stocks have room to run. >> we're in chicago, and tariffs could hit the bottom line. we'll break down what it means as trade tensions heat up. i'm kate rogers in new york city where chippolte is testing out additions to the menu. we'll talk to the chief marketing officer about the items and the company's strategy a supreme court ruling dealing a major blow to internet retailers. impact on the stocks and