i would put a stop in right where we got into the trade and we'll see how things develop >> steve >> kang, they're going at $20.60 >> up side 60 calls bought today. delta. >> power lunch begins right now. >> inching closer. optimism over a trade deal with china lifting stocks and putting the s&p 500 this close to all-time highs what's it going to take to get us there what could derail us plus, betting big on bubbly. the alcoholic kind pepsico buying soda stream is this the future of the industry who could be the next buy-out target plus, crazy rich asians making a crazy amount of money. what the success of the movie says about hole weed's attempt to diversify the box office. "power lunch" starts right now

indeed it does thank you very much. welcome, everybody, to "power lunch. a mixed day on wall street with the nasdaq swaying between gains and losses the dow touching its highest level intraday any gains for the major averages would be their third straight. energy and materials are leading technology and utilities they are your laggards right now. nike all-time high after an upgrade to buy at piper jaffray. estee lauder beating on earnings, and netflix seeing a pop, and that one reversing a bit of a losing streak good day for steel stocks. the slx etf is led by posco, steel dynamics, and u.s. steel morgan >> and i'm morgan brennan. thank you, tyler we begin with the markets creep higher the dow up 100 points.

the nasdaq is slightly lower it's about flat to the down side bob pasani at the new york stock exchange hey, bob >> we are creeping higher, and we're being helped by commodity stocks a terrible time the last few weeks the commodity stocks had as you heard there, all the big commodity names. aluminum china, bhp billiton, and even the coal stocks the president trying to boost the coal industry recently we would be hitting the new highs if it wasn't for -- >> we'll get that fixed. having some trouble there. we're instead going to have a market discussion. >> we are, indeed. the s&p within striking distance of reaching all-time highs, and on wednesday the bull market will turn 3,453 days old happy birthday the longest bull market in history. will the good times continue

jeff carbone is managing partner with cornerstone financial partners jason weir is with albion financial group. what do you think? can the market just rally hoe? >> i'm not smart enough to tell you whether or not over the short run the market is going to continue to move higher. it should continue to move higher given the fundamentals that we see out there, which is a strong economy, even stronger earnings growth, low inflation, low interest rates, and a valuation that's still not terribly demanding on the market you know, i mean, the trend is still higher, where the longer term trend is still higher take from that what you will over the short run there will probably be volatility and some pullbacks to be had, but we still like the longer term picture of the market. >> what's the biggest risk you have your eye on, jeff >> i think right now it's the headline risk of trade i call it the four t's trade, tariffs, tesla, and turkey just right now i think it's about the e's, which is earnings that have been coming in really great. we've had a tremendous earnings season as we wind down

year-over-year about a 10% movement, which is probably the best since 201 1 about a 25% increase for the quarter. about 20% higher than analysts expected we're seeing earnings in great order, and then we're seeing the economic data continuing to come in strong. unemployment below expectations at 3.9%. gdp, we can continue to go through all the positives. when i look at the risk, i guess it's really watching what is coming up right now, and that would be certainly interest rates and from the fed coming in september, and midterm elections not too far behind, but i think overall there's enough strength in the economy for it to keep moving along pretty nicely >> so, jason, you sound very positive, but you just throw your money at the s&p 500? you just buying etf? are there certain sectors that are going to outperform considering your viewpoint of where the economy is going >> that's a great question, and it requires a lot of nuance, unfortunately, right it depends on the investor if you are a young investor, and you have a 30-year horizon or

more, and you are just starting to invest, it makes sense to go ahead and buy the s&p and low cost index if you are an investor that has more of a complex financial situation, then you have certain requirements, whether it's dividend income or whether you want to protect the portfolio bit from down side volatility with some fixed income and safer areas of the market, then that would warrant, you know, a different orientation. we still like technology we still like strong cash flow technology names like facebook and amazon and apple and alphabet meanwhile, we think the consumer is still continuing to be strong costco and home depot are a couple of stocks that we're looking to to build solid portfolios with. >> jeff, your thoughts on that where would you be putting your money right now? is the u.s. still the best house on the block, or would you be looking overseas >> you know, i think it's balancing a diversified portfolio, certainly what we preach to our clients. right now we've been derisking a little bit in the portfolio. not that we don't think. we think the volatility might come -- may increase a little bit here as we go into that end

of august, september, october time frame still finding plenty of great opportunities in technology. >> what does derisk mean does that mean you raise cash or buy defensive stocks instead of -- or value stocks instead of -- >> great question. i think for us right now it's the derisking that's buying more value stocks like consumer -- some consumer staples. selective on consumer staples because certainly not one of the better performing sectors this year but when we look at valuations on some of the consumer staple areas, some of the food groups have really -- we've really found some really good valuation, nice dividends. derisking a little bit more on the large value side, but still realizing we're in a growth economy. technology with semiconductors, financials, materials and industrials as well as consumer discretionary are still some of the bigger overweights we have right now. >> jason, let's talk a little bit of turkey here how big a worry is it, and it feels to me personally that this is a movie, in part, that we've

seen before. in other words, an economy under distress with currency issues at play, and then you look at italy and their economy and certainly after the bridge collapse last week, people are angry at the government there, and the end of the greek bail-out are these things taken together or separately things that are on your radar screen at all >> these are things that we pay attention to, obviously, as active managers. we think the risk from, you know, turkey spreading into some kind of contagon situation that ends up impacting the u.s. economy, and by extension, impacting the u.s. stock market is fairly low risk you know, we do think that we see -- we thought this is in a protracted bull market here, and we think that the likelihood that anything outside of an economic recession ending the bull market is pretty small, so unless that contajon from turkey were to spread into the u.s. economy, we don't think it's a big risk for now

>> all right jason, clearly put thank you. jeff, we appreciate your time as well the reports president trump made new remarks about -- >> the president making those remarks in the hamptons according to bloomberg, saying that he had some suspicions that jay poul wasn't necessarily doing the right thing in terms of interest rate hikes going forward. this is a criticism that the president has made before, including to joe kernan in an on camera interview earlier this year here's what the president said back then. >> i've been a very good man in the fed. i don't necessarily agree with it because he is raising interest rates i'm not saying that i agree with it, and i don't necessarily agree with it. i must tell you. i don't. i'm not thrilled because, you know, we go up, and every time you go up, they want to raise rates again. i don't really -- i am not happy about it, but at the same time, i'm letting them do what they feel is best >> you know, michelle, my sense

here is that the president really wants the fed to hold off on those interest rate increases, worrying that it could harm the recovery overall, and one of the things that you look at in the history of presidents dealing with the fed is you have seen presidents who have been frustrated with their fed chiefs in the past over exactly this issue, raising interest rates, and whether or not that will harm the recovery of the economy at the time this president doesn't necessarily view the convention of sort of presidential deference towards a fed chief the same way other recent presidents have viewed it. some is are viewing it as something of a washington norm that's a bout for disruption this is a president who is unafraid to say what he thinks and instead of letting the chips fall where they may. this is an example of the president doing this over the weekend in the hamptons telling donors at a political event that he is skeptical of the fed's strategy here, guys. >> yeah. the report actually supposedly sent the dollar lower, according to the wires, amman, which would suggest that there are traders being influenced if you think interest rates

aren't going to go up as much, you don't think the dollar will go up as much. it's a natural reaction if you believe it, though we've seen so many commentators say that there's no way that powell is going to be affected by the president. >> you have to get into the dynamic of the two men if the president is signaling this publicly and privately, on camera and at these private events where he knows it's likely to get back to jerome powell, is powell going to respond to that? does he view this as a directive from the boss, or does he view this as simply political noise that he has to navigate through as he does what he thinks is important for the economy? if you are going to bet on this financially, the bet is on the relationship, not on the rhetoric of what they're saying probably >> thank you >> of course, in light of what's been a record amount of issuance of debt this year, it's high performance spending >> the latest on tesla's bump road to going private. one brokerage casting doubt on how secure that funding actually was, and new doubts about where it might be coming from. all as the stock continues to

slide from the post-tweet highs. we've got all thanese gl on tesla. that's next on "power lunch. it's absolute confidence in 30,000 precision parts, or it isn't. it's inspected by mercedes-benz factory-trained technicians, or it isn't. it's backed by an unlimited mileage warranty, or it isn't. for those who never settle, it's either mercedes-benz certified pre-owned, or it isn't. the mercedes-benz certified pre-owned sales event, now through august 31st.

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shares of tesla are lower right now. more now on elan's plan to take

the company private. hey, phil. >> hey, morgan i this i we're in the period here where we might start to hear from more of the analysts on wall street about what they think about the last couple of weeks. they largely have been silent since the initial tweet that was sent out august 7th and today we've heard from a couple of firms on wall street expressing some concerns about what the future holds for tesla specifically whether or not this company will eventually go private. elan musk and the directors, meet, are preparing for the s.e.c. there have been reports, though not confirmed by us, that perhaps as early as this week they might be talking with investigators from the s.e.c., and, again, we have not been able to confirm that, and, finally, the stock slide, well, it is at least slowed down a little bit today it dropped as low as 290 and came back to over 300. there you so he it right now trading just under $300 a share. with regard to what's happening with the saudi investment firm and the potential investment by the saudi investment firm to help tesla become a private operation, the saudi private

investment firm akorkd to a report on reuters this weekend, may invest in lucid, another electric vehicle company out of china. that report has people saying, well, wait a second. is there going to be an investment in tesla? the discussions, by the way, since this first came out a couple of weeks ago, it's very unclear where the state of those discussions lie at this point, and it's everybody's guess in terms of what might happen finally, arianna huffington suggested that elan musk perhaps get some rest, and he tweeted back at her yesterday, "ford and tesla are the only two american car companies to avoid bankruptcy i just got home from the factory. you think this is an option. it is not. i think referring to whether or not he can get more rest that tweet might have some people saying, is there anything go to change after the interview with the "new york times" where he said he is close to a breaking points, hasn't had a vacation since 2001, and as you can see from that tweet, he is not slowing down >> he certainly is not, phil i'm glad you brought up lucid

and the saudi investment fund in talks to invest in that company, that they've drawn up a term sheet, according to reuters. are they even making cars, or are they still early stages? >> very early stages very early stages. tesla would be a much larger requirement in terms of an investment lucid has that from the saudi investment fund, and there have been a number of reports out there saying just how much money do the saudis have to invest in potential future technologies. with all that drama that continues to build around elan and the company, how likely is it that the company succeeds in going private? with us is -- one of the biggest tesla bulls on the street. ramid, thanks for joining us today. are you still one of the biggest bulls on the street, or are you reassessing how you are valuing this company >>we have $450 target, though, you know, after the tweet that

target feels a little bit more like a stretch, but, yeah, this is a stock that was at $350 post-earnings, and the data point that the saudis were investing in the company, a lot has changed over the last couple of weeks, but we're still pretty enthusiastic about the fundamentals >> you suggested that you may change your price target based on the tweet i assume you mean the tweet, the going private maybe, funding secured. what is it about that? i mean, i can guess, but what's your thought process as an analyst when you see that, and why you might rethink your price target >> we're constantly reviewing our price target i think whether or not they go private or not, at $300, i think the stock is probably pricing in zero probability of tesla going private.

>> so you don't think it's going to go private? you don't think that the funding is in any sense secured, that this was some sort of just spontaneous tweet? >> i mean, that you guys were talking about lucid earlier, that's -- that's -- if that rumor is true that the saudis are considering investing in them, lucid is in early stage ev company. apparently they're close to a term sheet on $1 billion that's not a good sign because the saudis have said nothing since elan made that tweet at this point i would say that the chances are slim and none, and the fact that there may be a deal with lucid, i think, is just another data point that suggests -- >> it's not for you to judge, i suppose, because you're not an attorney or a prosecutor, but if he said funding secured and it isn't, is he in some sort of

jeopardy legally and does that hurt the company's stock if he is >> i would think that that is a violation of s.e.c. rules and regulations. i'm not an attorney, but, yeah, i would think that they are in violation. >> i guess i'm trying to get at here -- what we're trying to get at is what you have seen over the last couple of weeks, it's dinged your assessment of this company, right you used to be -- you still are one of the biggest bulls, but it sounds like you're rethinking everything here. >> no, i wouldn't say that i mean, i think we need certainty on whether or not they're going private or not, and then also -- >> what about his suitability, though, of running the company >> is he there for the long-term? is he going on medical leave is the board looking to replace him? these are questions that need to be answered. in terms of fundamentals, yeah, we've never been more positive if you look at the results and the outlook on august 1st, mean, this is a multi-billion dollar

company that guided for 50% growth in the third quarter. they have overcome their model three production constraints this is the best selling small and mid-luxury vehicle in the month of july, and they're going to be profitable from a fundamental standpoint, which is the basis for our buy rating at $450 target, we've never been more optimistic, but what's happened since that tweet, i think, is certainly an element that we were not anticipating >> well, i have a feeling we'll be talking about this much more as we go on here gentlemen, thank you both for joining us today romit and our own phil lebeau. coming up, why the republicans may not be able to ride a strong economy to a big red wave in november we're going to hear from a top republican in congress then, tariffs starting to weigh on a lot of industries, including yachting contessa brewer has that story from tampa hi, contessa

>> hi there. you know, that egg getting hit by tariffs from all sides. retaliatory tariffs. i'm here inside the -- this is what it looks like when they're getting a boat ready to go out this one might have been headed to europe, but with a 25% retaliatory tariff, those sales have dried up. i'll explain more right after this break on "power lunch." yos 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.

>> hi there, tyler a lot of people know what a finished yacht looks like, but i'm standing here on the bow of this bertrand 61-footer under construction this is a boat that might have been headed to a very serious urine even b european buyer, except that tacked on an additional $1 million to the $4 million price tag. the buyer bached the sale stalled that's not the only one. right now all sales that bertrand yachts to europe have been put on ice at this point, and they're not the only one the ceo tells me his fellow manufacturer riding some rough waves these days slapped with the retaliatory tariffs. canada, mexico, the e.u., 15% of all of the boats and the engines manufactured in the united states are heading for those overseas markets, unless you shrug this off to rich people problems, the 90 employees here

say they're not rich, and, by the way, they remember when a luxury tax of 10% was applied and sales dried up >> the blue collar workers, they're the ones that got hurt by the lungsry tax and the ones that got hurt by this. some will lose their job, and nobody likes that. that feeling goes over the whole plant. who is next? me >> on the up side, domestically demand is up, and thanks to a strong economy still, price hikes are coming because there's also tariffs on the chinese imported materials things like all the fiberglass that's required to make these boats. the people here say they wonder when that's going to trickle down to their jobs and could have a real impact, guys >> this gets my attention because the boating industry here in the u.s. and boat manufacturing has always been seen as more as a domestic indicator. domestic economic growth, consumer sentiment, what the stock market here is doing, and you see a correlation between that and boat sales. when i hear you talking about

the manufacturers here making these boats to sell them to places like europe, that sounds like a shift to me i'm wondering is this more of a story at the higher end, or is this all through the sort of different price points on boats? >> the u.s. chamber of commerce says that in florida alone the boat making, excepting outboard motors, so this is all boat making, is the biggest industry affected by tariffs in this one state alone. overall 15% of these boats are heading to overseas markets and take bertrand ceo, he says our growth plan is in growth mode. our growth plans are really included overseas markets, and the royaling trade war has put uncertainty in how often we heard this refrain uncertainty is a business killer >> contessa, thank you contessa brewer in tampa the u.s. reportedly very close to i atrade deal with mexico is progress being made with

china as well. we'll have the latest. shares of soda stream popping today as pepsico is buying the company. the company was once nearly written off by the street. daheweetheagofore on t sa so wn rurn. you always pay your insurance on time. tap one little bumper and up go your rates.

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itsian authorities releasing security camera footage from the moment of last week's deadly bridge collapse in genoa the video shows people pretty much going about their business moments before huge chunks of concrete crash to the ground at least 43 people died following that collapse. on the indonesian resort island of lombok, a series of earthquakes struck late last night, killing one person and causing others to rush out of the buildings in search of safety the island is still recovering from a deadly quake earlier this month that killed 460 people nearly two in five teen drivers text while behind the wheel. that's according to a new study

from nationwide children's hospital it showed texting while driving was more prevalent in states with a learner's permit of age 15 or younger. and dozens of elderly south koreans crossed into north korea today for face-to-face meetings with relatives most haven't seen each other since they were separated by the korean war more than 60 years ago. according to officials, 197 separated south koreans will take part in the first round of reunions that run until wednesday. 137 will participate in a second round from friday to sunday. you are up-to-date that's the news update this hour morgan, i'll send it back to you. >> i love that story sue herrera, thank you let's take a look at the markets right now. the dow and s&p are higher the nasdaq is also swinging between gains and losses, though slightly higher right now. we've got some big names hitting highs today. apple and nike both touching lifetime highs though apple did turn lower.

down about half a percent right now. merck and pfizer also hitting 17-year highs. tyler, back to you >> thank you very much morgan, u.s. on the verge, it seems, now of a trade deal with mexico this according to a top advisor to president trump will canada be next? what about china kayla is tracking the latest on trade. kayla. >> hey, ty the white house chief economist just the latest to tout a forthcoming deal with mexico, but the white house doesn't actually have approval from congress to do a bilateral deal, so he notes it most likely will have to pave the way for a broader nafta deal >> i think what's going to happen after we close the mexico deal is that canada is going to look at it, and see some stuff they like and maybe stuff they want to modify, but it's going to make it a lot easier to make a deal with canada because we got to deal with mexico. >> elsewhere on the trade front today, senior e.u. trade officials are in washington trying to flesh out that july 25th trade deal, but the big focus is midweek when china's vice minister of commerce will

lead a delegation to washington. those talks billed as i precursor to calm the waters ahead of a potential november bilateral between president trump and president xi at apec and/or at the g20. this even as washington is keeping up its guard against china. sources say the white house will host members of congress on thursday to tout the newly stronger requirements, and the u.s. is hosting japan and the e.u. on friday to discuss how to challenge china at the world trade organization then tariffs on $16 billion in chinese exports may still go into effect on thursday. we'll see. one goal of china this week, to take the administration's temperature and see what's changed in the last few months there are few indications, michelle, of cooling just yet. >> yeah, i was going to say what's changed, if anything? thanks, kayla. all right. can we expect a break-through on trade with china, and if not, what's next? let's bring in stephan he is former undersecretary of commerce for international trade under president obama, and michael pils bury with the

hudson institute and advisor to president trump, and he is also the author of the 100 year marathon, china's secret strategy to replace america as the global super power good to have you here. michael, what do you think can we get a deal done with china? are you hopeful? >> i'm always hopeful, but i think the gap is pretty broad between the two sides. back in early may the u.s. side brought up 24 points sometimes called the a points because the 24 broken down into eight sections chinese brought up 12 points there's room for compromise on some things. just as a joke almost. i can tell you the chinese deny all of the technology theft, wrong doing. all they would have to do is say, well, we'll never do it again. we have room for some sort of compromise there on the harder issues, whether china can come up with $100 billion a year additional purchase of american exports immediately in the following year, i think that's less likely there's room for some compromise in the investment area equal treatment by both sides of

each other's companies and investment the thing you mentioned just now plays into that. there is room for compromise, but there's also a chinese expression meaning "empty hands. mr. wong, vice minister wong, who is coming, is known as a hawk he is the one who issued the statement about a month ago that china has done nothing wrong and it denies all these allegations. >> okay. >> on our side we have more of a dove, a gentleman the chinese perceive as their friend, david milpas he has been on the board of the national committee of u.s.-china relations. >> we know him well. he has been a long-time guest here on cnbc >> they think he is kind of a good guy yes, the makings of a deal are there. i'm trying to be optoptimistic >> aforementioned stephan. what do you think? >> i think it is good that at the vice minister level, which is the level i was at in the last administration, folks are

getting together in anticipation of these upcoming meetings in november that president xi will have with president trump. there are not only a huge number of issues, as michael mentioned, there are very fundamental issues my concern is that, you know, making problem on the theft and counterfeiting of intellectual property is for sure possible, but the notion that structurally that china is going to change the state support of their economy, i think, is very far-fetched, and as a result i think the -- not only the breadth of asks to michael's point, but the fundamental depth of what we are looking to have happen is unlikely to be able to -- >> this is a provocative thought. we've had derek scizzors on from aai. he says because of that, give up stop trying to consult a deal. what do you think of that, michael? is this just -- let's stop pretending that they're ever going to be different and start to rethink our relationship with china? >> no, i agree with stefan that the structural differences are enormous they're not going to give up being a state-owned enterprise

as a country as a whole. however, half their economy may be a bit more two-thirds of their economy is the free market they do have going for them their own market -- their own economy being in trouble >> but you disagree with the prime minister we should keep trying, though? we should keep trying, you this think? >> yes >> you think we should keep trying >> i don't think we have a choice, right? the question is can we -- you know, it's very easy to inflict pain on china and other countries. the question is are the policies and things we're going to do going to change their behavior that is to me the overriding question >> what constitutes victory here, stephan, for the u.s.? >> i think you have to go through it item by item, and i would be be thinking about the bilateral trade deficit that michael mentioned because it makes no sense to judge these topics on the trade deficit, but we can say are you taking capacity out in steel and aluminum, for example? are you taking fundamental steps from requiring u.s. and western

companies to transfer technology are you doing something really about the theft and counterfeiting of ip are you doing something really about state support of businesses >> and if michael the chinese did everything that stephan just mentioned there and said, yes, we are going to do this and that, would you believe him because the minister you cited earlier says we're not doing any of that anyway >> it would go -- if the -- that would go a long way. frankly, a lot of decisions, the wto has handed down in our favor, the chinese have not implemented. one of the most outrageous is the ban inside china on master card, visa, and american expr s express. they have their own credit card. they want it used worldwide. i think they've pretty much exceeded our cards now in terms of global market share what stefan is referring to,

that's what we're facing at the margin, can there be a deal, and both sides say we've made progress? yes. will it be total structural change by china? absolutely not >> all right >> just one point, which is i dealt with the vice minister of commerce, the predecessor to vice minister wong, and i will tell you in numerous meetings there was never a single time where i felt he was not being candid and straight forward and honest, so to your point, can we trust them and believe them when they make affirmative and definitive statements? my experience would suggest the answer to that is yes. >> okay. stefan, thank you so much. michael pils bury of the hudson institute. we're going to stay with politics john harwood is sitting down with a man who may have the most pivotal job in washington. representative steve stivers in short, he is the guy of stopping a blue wave from taking over the house in november john >> exactly, michelle as good as the economy is going

right now, it is an uphill fight for republicans to hold the house in the estimation of most forecasters, and the reason is that economic argument is not so clean to make. the trump administration's immigration policies complicate prospects for future growth, and in the near term even after the tax cuts and the surging growth in the second quarter of this year, average workers aren't feeling much benefit in terms of higher wages i've talked to steve stivers about how you approach that. >> i think the american people have been so long without a raise since 2008 that a lot of people, you know, it's probably a long time coming, but it's on the way. you can see it already in the labor shortages that are out there. >> we do have a labor shortage, and given that doesn't that make it a bad idea to cut legal immigration? >> i don't want to cut legal immigration. in fact, i don't think the president wants to cut legal immigration. he suggested replacing the lottery with a merit-based system that would bring us people that we need.

>> cut legal immigration in half >> i think we should bring in people in the high-tech fields i actually also believe that when you graduate from one of the schools in my district, i have ohio university down in athens if you keep going down 33. or if you go 33 west you'll bump into the ohio state university all these foreign students that come here on a student visa, i think we should staple a work visa to their diploma because we educated them here, and then we forced them to go home and compete against us, which is a silly economic policy. zplu don't agree with the president by cutting legal immigration? >> i believe we should help people that want to come here that have skills, help us grow our economy. i'm for that >> of course, the other complication in the republican argument is that all the economic forecasts are now showing that we remain after the near-term growth in 2018 and 2019 on a long-term path of just 2% economic growth

when i asked steve stivers about that, he said, look, i don't think tax cuts can raise economic growth over the long-term, but they can give you a chance, provide some incentives to make that happen not a clear cut economic argument that republicans have right now, guys. >> all right, john harwood, thanks in d.c. rick santelli tracking action at the cme. hey, rick. >> an intraday of ten tells you all you need to know 282, the low yield this is lower than any of the trade that we've seen intraday since the 3% about two weeks ago. the one closed if you look at a chart from may 1st, which jumps out at you, is the may 29th low of 278, that's what traders are watching. in terms of the yield curve in 23 ten's minus twos, a flew flat going into august of 2,007, and finally the last chart, this one starts in july of this year. that market could trade all the way down to 95.5 without doing a lot of technical damage to the

bullish argument tyler, back to you >> all right mr. santelli, thank you very much up next, shares of soda stream surging on the heels of pepsico's $3 billion buy-out deal how did this left for dead beverage company that was once hot revive its sales and become a high flyer again in stick arou tfi o welunch returns after this

zbliefrmt welcome back soda stream getting bought today. more than $3 billion pepsico is the buyer the stock up nearly 10 % long-time viewers may remember that soda stream has been a big-time battleground stock historically all the way back in the spring of 2011.

contributor herm greenberg and jim cramer squared off for a no holds barred taste test on street signs with our friend sully and mandy, and at the time herb was raising red flags about the soda stream stock. jim was pretty bullish here is a little taste of that face-off >> so we're going to do two sodas. did he start >> he did. he chugged it. he shotgunned it >> all right >> second one, please. >> now we're going to go to cup b. how do i end up getting stuck with greenberg >> good question >> b >> this is a totally flat soda i wouldn't buy this if my life depended on it >> all right >> we go to the coca-cola versus the soda stream cola, the darker cola, herb greenberg, which one did you like >> i chose a i thought a had a great taste. the other one i thought had somewhat of a flattish after taste.

>> i chose a because that was fresh, and the second one seemed like it had been, i don't know, like i don't know what the born on date was. 1957 >> okay. both of them picked soda stream. >> soda stream >> yeah! 55 goes to par >> joining us now to react, these many years later, is herb greenberg, cnbc contributor and a partner at pacific square research i know you remember that day fondly, don't you, herb? >> you know what's interesting, if you look at that tape, you'll see that cramer was actually -- he was like arlene francis on the old, old, old "tell the truth" which you always knew she was looking underneath the mask. he was looking up. i think jim sort of knew what he was doing. i'm not alleging anything. i do remember that that was a lot of fun, and, by the way -- >> are you suggesting he cheated? >> it tasted better. you are suggesting he peeked >> are you suggesting he peeked? >> jim

i wouldn't suggest that about jim. i have great respect for the man. >> what do you think of that -- what do you think of this deal, and did they pay too much for it >> you know, i don't know if they paid too much, and i -- it's very interesting. i have not looked at this company. i forgot the company existed until today. this was an interesting thing. i look back at what i had written in 2014, and this was in daniel -- people probably don't remember he came out after they whiffed earnings the stock was at a totally just one straight down, and he said we blew it we have to do something different. you don't always see that kind of candor from a ceo he turned the thing around, and what i think is interesting, i look back just looking at the reported numbers this morning, going all the way back to 2011 based on the reported numbers, what a turnaround in revenue what a turnaround in margins we haven't done a frienorensic review here, but he reinvented the company. what did pepsi get i this i you have to, you know -- you have to say either

they're brilliant and they basically said we don't care if soda stream has been going after the likes of us for years. we need what they have to offer. that's a smart deal potentially down the road. whether it is. whether they paid too much, i can't give you an answer >> where is their growth where is their growth coming from is it u.s., domestics, or foreign? or do you know >> again, i haven't looked at it in detail. their growth originally -- the analysts were thrilled with their european growth going into, you know, the last quarter. they've done a brilliant job on marketing. i mean, just look. if you go to their website and look at some of the ads they've run, i was sitting there chuckling. they are shaming people into using plastic bottles. of course, they're talking about fizzy water. a lot of people use plastic bottles for non-fizzy water. just walking around. but i think that that's been the beauty of what they've done. i come back to this concept of reinvention, and, by the way, there's another interesting part of this story. this was a situation where the bulls and the bears were right the bears were right early on.

this company really, you know, was a fad. it appeared to be a fad. then they pulled it out. anyone who is long this thing has done spectacularly well based on the rumors of acquisiti acquisition, but, taylor, the @f0 where we can get our fees and commissions back if we're not happy. so can you offer me what schwab is offering? what's with all the questions? ask your broker if they're offering $4.95

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test test test the power of having diverse casts and the kind of diverse -- a big audience and one episode ends the next one starts right away i like that. now flet flicks is inserting promos for its own shows they're not showing me commercials, are they? >> well these are just a test. so i haven't seen them in my netflix feed a number of us in the l.a. bureau have not seen them but a number of people have seen them because they are testing them. they are quick to point out they are just promos not advertisements one of hundreds of tests they do every year. the key thing is they want to make it easier for you us to find content we want to watch.

they say this is a way to do that the promos are customized to you. >> when cable was invented they said they weren't getting commercials but we love commercials at cnbc we are glad is changed lastly speaking of net flex people share passwords for streaming services isolate guilty. >> the numbers are shocking. this is particularly bad for millennials imagine the research firm tells us 35% of millennials is accesseding streaming service that could be net flex or amundsonen prime or hulu through someone else's password. in the past people have said this isn't such a big problem and they set limits to the number of people who can access louisiana account at any one time but the issue is here these are millennials you don't want the next generation to grow up thinking it's okay not to pay. will people be trained not to

think they have to pay for the content. >> i used to get copied mixed tapes in high school i eventually paid for albums >> the ceos -- they say that maybe people will age into it. you know, once they can afraid or gets too complicated borrow a sbard they will pay. some people say it's good marketing to give people access to shows before they are ready to pay you have to wonder at some point that's a third of millennials not paying. >> i forgot the password and i broke up with you how are you get going back i've been using my girlfriend's or boyfriend's password these many years and we are -- how am i get going. >> thank you, julia always fun. still to come as the markets creep to an all-time high, restaurant stocks are going for the ride should you be betting more and more people dining out plus with all the calls coming it's time to regulate social

media. some content counsel to fix the problem. one of the voices behind the idea is joining us, another jam packed hour of "power lunch" right after this break

good afternoon, everyone and welcome to the second hour of "power lunch" i'm tyler mathisson and here is what's on the men yu the bull market set to become the long-term in history this we can. set out in three acts. what does that tell us about where we might go? valuation risks, whiem apple hits all-time highs. some are worried that near term catalysts are priced in. we will talk about and twitter and facebook removing controversial figures from many platforms without disclosing much about how they make the decisions is there a better way to do it we will debate that as the second hour of "power lunch" begins right now ♪ changes, the face is strange ♪ ♪ changes ♪ you want to be a richer man snoebs. >> welcome to power lunch morgan brennan. stocks moving higher with the third straight day of gains. if the dow closes at the levels

it would be the highest since february 1st currently up 100 points. commodity stocks a pig part of it steel can be coal, copper names. all seeing gains we have the retail sector with new highs. nike nordstrom, costco and dollar general higher today. and airlines also taking to the skies flying high. american airlines united continental and southwest are leading. united hitting the all-time high where american has the best day since okay of 2017 that is leading the transport average i should say to outperform today. >> big moves there thank you very much morgan we are talking some markets because right now sitting on the longest bull run in history without at least a 20% drop. mike sandly and bob are at the nyse >> it hasn't been an uninterrupted climb since march of 2009. it looks like almost three

separate discreet mini bill markets separated by a reset in between. from 2009 really into early 2011 the market doubled then you had a severe correction some call it the self-bear market it went side ways in 2012. then you have a lift off and reset correction in 2015 and 16. you had different dynamics fueling each one one a snapback petition beginning then the fed involved then correspondent proermts supported things as well as byebacks even though we talk about it being the longest bull pact market by the technical measure. it has been the 90s bull market which we are about to edge out is was stronger about 18% a year returns versus this at 15% the question is is it young for a day. >> a couple of things bother me about the 20% thing. nobody ever decided it was going to be 20% the bull and fwaer is

evolved that way in the last 20, 30 years there is no committee that decided on that. number two, we actually did drop 20% in 2011, remember the height of the credit crisis. >> sure. >> s&p lowered the credit rating of the united states in 2011 we dropped 20% on an intraday basis they don't count it because it's only closing they count now because we don't have records of intraday prices going back a lock way. we sort of did do that nobody disputes that point they say well we just use the closing prices. >> adding to that the s&p downgraded the united states it was drooep deep, deep throws in the italying financial crisis. a lot of people think that's way why it went down even the s&p downgraded u.s. credit what it they do they bought u.s. credit. remember the yields fell dramatically. >> the other thing i would oint put, everybody at home be bull markets tend to last longer than

bear markets that's why the stock market kept going up inches the average since the '20960 days. the bear markets have been about 3,000 days the take away for everybody with the head spinning about all the numbers we throw out, bull markets last longer and that's good for all of us, right. >> one of the funny things to finish off about the 20% kind of ash traesh threshold is the market dsh, the s&p has gone down 19% high to low unusually large number of times. >> if you include 19%. >> sure. >> the somebody out will there is protecting the 20% level. talk about that another time. >> thank you bob, mike down petition nyse. >> what point is the bull market overstretchedlet's bring in chief investment officers with heart ltd financial pap wells fargo asset management nancy starting with you. the discussion we were having how much further can it run.

>> i think both gentlemen mike and bob made our point, which is not this historically doesn't have predictive value. we are looking at profit margins and a earnings growth and sales growth leading economic indicators and the coincident indicator everything is foretelling stronger for longer. for us we watch non-load gdp 37 up 7.5% that drives correspondent revenues and wage growth and productivity. that's mattering to stocks over the long term than the lepgt as you can see we don't know the length you have to back out a number of 19.9% dl declines. we are much morp interested in what driving stock earnings and revenue growth. >> i think, kirk we are less than 1% from the record high hit earlier in theier in the s&p are we breaking through that if so what are the risk factors you watch closely that could

derail the market now. >> well, i think we could break through. we are testing the january highs. it's possible we get to the 3,000 level in the s&p what i am worried about a bit is where we are going in terms of interest rates and i'm watching the 10-year treasury closely had as into nice rally to down to 382 as long as long term rates stay low that's good. the other thing giving me pause is institutional investors are looking at non-correlated assets which tells me they are concerned about valuation and they want to diversify. >> what would you do kirk if the s&p 500 hit 3,000? would you buy more, lighten up, just let it ride >> well, i think what you do is you lengthen the time horizon. what i'm concerned about is everybody is very much long tech stocks and long bonds and they have a lot of duration risk. i think what you have to do at that point is to say what mees time horizon i wouldn't be buying things

short-term and i have to say i want to own things the long term and expect the volatility. >> nancy, when president trump comes out and says as we have this report he has done again over the weekend comes out and says that he is not in agreement with the fed raising rates right now. concerns perhaps that it's going to hurt the economic growth that we're seeing in the country. what do you think? >> what do you think about his tweets or what do you think. >> should he be criticizing. >> is he right or should the fed be tightening. >> yeah, no. listen, the -- presidents have weighed in over history. they shouldn't be -- i don't think it's going to influence the fed. i think what's more likely to happen is we're seeing some softening. and the strong dollar is going to cause inflation to soften because we see pressure on commodity prices that's driving the fed we have one more hike in our forecast we could be wrong. there might be two but i don't think the fed's sitting on the edge of the chair

waiting to see the next tweet. >> kirk you said you were following the 10-reporter yield. you had like it lower. there are people nerves it's lower. the 10-year getting close to the two and then we have the inverted yield curve do you want it to go up or down? i can't figure it out. >> normally an inverted yield curve you get worried about it i think the thing there is a lot of misinformation in the market because of the central bank. in a normal environment i would agree with you i think the thing is where the dollar is going. and that also is a function of where the 10-year treasure is going. but otto of misinformation in the market and it's hard to judge the shape of the yield curve given the central banks. >> we'll leave it there. thank you for joining us nanciy tangler and kirk hartman. >> what the country of venezuela did that makes it worse than the

weimar republican. >> plus social media companies criticized for pulling off content. one of our guests says there is a better way she joins us live to explain. apple stocks on fire should you add a little more downward dog to the poverty? that and more ahead on "power lunch. adults are just kids with much, much better toys. introducing the 2018 c-class sedan, coupe and cabriolet. the thrills keep getting better. lease the c300 sedan for $399 a month at your local mercedes-benz dealer. mercedes-benz. the best or nothing.

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banks in venezuela are closed today as the leadership in that country tries another round of what they call economic reforms. there is a massive devaluation of the official rate of currency which is an acknowledgement that the real rate, the black market is more accurate they are introduce agnew currency removing five zeros from the bill as it suffers from hyperinflation which they say it's worse and the weimar republic a cup of coffee is recorded to cost 2 million bolivas they are raising gasoline prices to combat smuggle across the border there are a syria like border crisis with the neighbors worsening. millions are trying to flee

which some are calling the somalia of lant america. the government clings to socialist price controls and state control of resources the president of andrea even kwirsz his firm advises on capital markets ever lant america. they have so many things going on what are they doing. >> unfortunately, it is worse nan it sounds. and it sounds pretty bad what the maduro regime is attempting to do is create confusion. chopping five zeros off the currency making it like the crypt ofr currency they have been trying to institute and it's valued by the market price of venezuela basket of

oil. if that's confusing it is. baste what they are trying to do they are trying to have a major devaluation of the currency. take away the savings of the middle class and multiple reply supposedly the minimum wage 30 x by september and that the government will pay for this in three months that can't happen. if you believe that's happening then i have a bridge to sell you. >> is this the spasm that creates a revolution there or that ends in maduro's departure one way or another. >> well, as a very well respected columbian general told me there is no doubt in my mind maduro falls in the next six months but i've been saying that five years one would think surely this is the last straw but we have seen quite a few last straws in this debacle. >> why does the military or anybody support him? am i exaggerating when i said the somalia of lant america is

it just descending it into war lords. >> i would hope not. there are two large porous border was columny and brazil. what we have discussed many a time these are the largest oil reserves in the world. 300 billion barrels in the country. >> the border crisis is it. >> it's shocking it's a real humanitarian crisis. the imf is pepping the brazilians are helping but both countries are overwhelmed by the numberless of people showing up. >> which begs the question o question is there a point at which other countries step in and say enough is enough now and can they do that. >> columbia has not done so brazil attempted to do so. they momentarily closed the border and there was a could court order reopening the border but there are not just those two countries. there is thousands and thousand fs venezuela walked to argentina. 80s 3,000 mile walk with children images they've just never seen

in lant america before is unfortunately something we are seeing now. >> we should worry less about them i suppose but what are the wealthy doing their o with their money and doing day by day to get guy? increasing security. >> the security was snnz the dramatically about seven or eight years ago. the upper echelon of socioeconomic life in venezuela have been very rich. they have been pursuing oil since 1914 they were for many yeerps the per capita rich icht country in lant mark. and the concord as youed to fly direct there the rich have left, in paris, spain, new york, and lant american country. >> announcer: how does this play out from louisiana investment standpoint we had the news with the conokay o sell off is there a bigger concern in terms of the impact for wall street and businesses outside of

venezuela. >> there are a couple of things we need to to take into account. there is $628 billion worth of bonds from the oil company in venezuela not paid since the default occurred there is about $5 billion another three in change by the ended of the year now the venisonle andin' debt to the marketplace is $70 billion had that sounds -- who is the marketplace? this is u.s. retail and pension funds thap that's owning these that's mutual funds. there is oil prices. they used produce 3.5 million barrels and now producing 1.1 to 1.2 million barrels. bond holders are being impacted. there is a saga that still has a lot of chapter chapter. >> when when you think it can't get worse it does. >> thank you >> and still ahead switching topics radically at leisure stock killing it with sore this

month and will it continue trading nation takes a spandex-filled look. when celebrities meet to play golf for a good cause. dominic is there to cover it >> but not in spandex. no at leisure for me right now what wove a good foundation coming together at morgan hoffman's event to raise money for muscular dystrophy keep it here on power lunch. that those items may need special insurance to protect against costly damage, theft, or liability on the job. trusted choice independent insurance agents represent multiple insurance companies and customize coverage so business owners can focus on business. announcer: to find an agent, visit trustedchoice.com

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welcome back to power lunch. muscular dystrophy in various forms affects millions including professional golfer morgan hoffman he has been a champion for the decease and is holding a tournament in new jersey raising money for the foundation and dominic chu is there with more hi,dome. >> hey, tyler. the idea that muscular dystrophy can be used as a positive force is something that morgan hoffman wants to hit home and that's why he puts this event together and getting dozens of business and sports leaders together for the event. he told us a little bit about his story. here is what he had to say about what he he feels about his story

and what it means in the future. >> my story is i was diagnosed with muscular dystrophy in late 2016 and i didn't want it about myself i knew with the platform i can help so many other people. >> now it's something he at least is trying to spin in past way. they have raised a lot of money thousands from this event. about almost over a million dollars for the foundation rory mcilroy was drawn to the story as well. he is here here is what he had to say about why he showed up. >> i read his players tribune piece and was so moved by it i thought this is a guy delta pretty bad hand. but he is trying to make the most of it and he is trying to help other people with the cause. >> and also this idea, guys, it's about the future. i just got off chatting with jerome bettis, a nfl hall of famer he told me one of the reasons he is here is because while the efforts they make may not benefit morgan specifically

it could help a lot of people down the line. that's why he is here to support the could you says cause as well a great event. the second 18 group, the second 18 foursomes teeing off right now. a huge event raising money por a huge cause. >> a lot of pros are in the area for the tour event later this week as well, right, dom. >> the reason there is a lot of folks here is up the road in ridgewood is the first event of the fedex cup playoffs on the pga tour, the top 125 folks are gathering at wichmann rd owewood up the rd. goes through sunday. this is the point stage this is where we crown the champion that gets as the 10 million pay out by the end of the season. >> dominic chu in new jersey. >> time for trading nation nike hitting a all-time high after a piper jaffrey upgrade. pushing theed at leisure space

up with it under armour and foot locker up and lieu lieu lemon higher as well with oppenheimer and bill with lieu line features good to have you here. what do you think? chasing nike or do you like something else. >> i like nike i think you retire it run. you add to the winners first off let's set the table. the equal weighted rated breaking above 3-year resistance there is top-down tail winds here i think the industry continues to rally including the apparel names. as i led in whip stick with the winner nike a stock we've been on the show talking about a few months back. i think the key point is that relative to the s&p 500 the stock is still retracing underperformance dating back to its 2015 relative peak so relative to the market, breaking through resistance levels, a positive trend

we can see that rising 200-day moving average we think that relatively ratio rises indicative of continued outperformance in nike stick with it add to it. >> how about you bill? do you like nike, the sector something else within the is sector >> i would not fight nick ee it's making new highs and still goes but i want to bring attention to under rmer warren buffett says invest ma what you know. i know under armour. you can find me wearing under armour that applies to a lot of people out there. there is no age barriers it lost what 80% from where its high was this is a turn around story right now. but it stabilized. i think there is some long time value down here with limited downside look at the earnings report recently they did show revenues dating 8% year over year you start to gain traction and you'll find it higher. again i think this is a nice investment for the long-term and finding value in something that lost a lot of it

looking forward. >> not just a customer he bought the company. it's an old jokes of an ad. >> thank you, guys bill and airy for trading mediation head to the website or follow us on twitter at tray trading nation. coming up apple continuing to hit all-time highs why are analyst worried the good times won't lats plus happy anniversary google. the stock up more than 2770 oh% since then what the company accomplished and could could be in store from here power lunch is back in two >> announcer: and now the latest from trading nation from cnbc.com and a word from our sponsor. alerts -- wouldn't you like one from the market

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welcome back let's get you a check on the mechanic the industrial average up by

triple digits. a gain of .4%. nasdaq in positive territory and the s&p 500 higher by nine a third of a%. nike we just talked about got an upgrade. bowing and johnson and johnson and marc nike leahy has a 3% gain wal-mart a great one last week taking a little off that .75% lower. names at all-time csx, norfolk southern and let's get to sue we have the news update. >> here is what's happening at this hour everyone residents in western ukrainian city needed to be rescued due to heavy flooding the city sewage systems weren't able to handle the rainfall as one third of the normal monthly total fell within one hours. a second person pulled from the water off a new hampshire beach on sunday has died six swimmers who were in distress and one good samaritan

were rescued from the water off sea brook beach. after the incident code red alerts dw advise ds people not to swim due to dangerous current. and not one but two fivens bearing down within japan with the first expected to approach the southwest islands tomorrow local officials expect heavy rains and gusts reaching 135-mile-per-hour. and the cafe in london opened it's store to the cutie pies hundreds of the short but long dogs and owners in the shade of st. paul's ka cathedral on sunday all the canines received pup accinos and a bag of pup corn i'm not sure what the last one was. i don't know whether he had a costume or maybe a long haired dax nds i'm not sure. >> the oil market is closing for the day let's get to jak at the cnbc medicatety desk.

>> hey, morgan oil prices higher alongside stocks session low under $65 a barrel back over that level now the opt i. over trade tax with china are a positive for the oil market a calmer trade the environment means no drop in global demand also the announcement from the department of energy from spr sell very small sell expected by the market as well this week and next expect to be more of the same for the oil trade. but some 70 post labor day look for a seasonal drop off in price barring anything unexpected. >> we will do that thank you jak. apple hitting another all-time high today. what is propolen the stock higher are there risks snp josh is lift in san francisco with more hi, josh. >> reporter: mitchell emichelle, apple stock performs well hid of new launches the stock is up 15% so far this month after the latest earnings all-time july 31st wrr strong

demand for the iphone x lifted the price by 20% bern ernest says in the month prior to a new iphone launch the stock has been up on nch 5.3 process% over the s&p 500. the six months out it's up 4% over the broad gauge we are waiting to hearer when the launch happens this year still not everyone is an apple fine today the rare apple bear raised his head pierre of new street research downgraded saying the porpt pulled forward demand which leaves in his words an air pocket next year other analysts are luke warm on the stock because of valuation concerns meaning they think a lot of the good news is priced in but that remains a minority opinion. more than 60% of analyst still think you should own apple mere. >> thank you very much. should the apple valuation keep you on the sidelines?

could it derail the recent rally? retires let's bring in michael olson and kevin delaine, copresident and editor in chief at quarts. welcome to both of you michael let me ask you, first, not as a trade but long time investment if i'm the kind of person who invests in individual stocks, is there any reason why i wouldn't want apple as a core holding? not to use a bad pun i didn't mean to >> well done there i think you do want to own apple. and we have talked about a lot about what we call the superlong cycle. everyone is talking about supercycle for the iphone tp the supercycle a upgrade next again form factor. i want a we'll get a wider array of next again with a iphone xs and then we call the x line a

dumbed down lower priced version that will be a catalyst for the stock this year. >> kevin talk to me about how you reacted last week to -- the week before i lost a week because i was on vacation -- when apple came out with the numbers. were you caught off guard or surprised about how favorable not only the trailing numbers were but by what they said >> yeah, i think there are two questions. one was what the iphone x -- was it the most popular phone? and it was and i think that that actually with pretty powerful good sign for them the second thing that we noticed in the earnings that was interesting is just how large apple's content services business is. and how it's able to smooth out some of the seasonality. their q 3 -- or q -- q 3 is traditionally a weak quarter, the last quarter and we're seeing the services come in at you know in the range of i think 20% of overall revenue or so. and they're smooth and that's actually you know playing into this question of cycles. >> yes,ive condition for years

one of the concerns one of the criticisms of the stock it's a one-hit wonder the reliance on the phone and the moat around the phone goes away what if it comes the next motored ol oi pch what you just said suggests maybe they have gotten over the hump. >> i think that is something to keep an eye on it's a minority of the revenue without the success in the phones that business you know pretty much goes -- goes away. i think apple is a strer straightforward company to understand apart from that and that is it's a luxury goods company. and it focuses on physical goods. it's not primarily an advertising company. so it offers luxury in the form of privacy as well in terms of data privacy which is interesting. and it goes category by category and develops offerings there the category that has been introduced during tim cook's tenure as ceo has been the watch. we have also seen some much lower magnitude but still

successful products like air pod. i think over the long haul what are the other consumer luxury good categories apple gets into. >> michael do you want to jump in morgan. >> michael i want to go become to the iphone for a second i know services are a bigger piece of the story with apple but it if history is a any symbioticer we'll get the new models next month. is there any reason to believe that the demand was pull forward with the iphone x and that 10th anniversary? or do you think the demand is kinning to be brisk? >> well, we originally thought that was going to be the case into the launch. if you look back at where street estimates were going into the i feen x lunch it was $245 million phones were supposed to have shipped last fiscal year and that didn't -- this didn't play out to be the case. it's enup closing 220 million. so i don't think that happened i think that was the expectation. but it didn't play out that way

which means there is that many more people on phones on two, three four years old or older that are ready to upgrade. >> michael, let's pif pivot to gogel if we might here and i guess play a game of would you rather would you rather apple or google at today's price sns and number two i'm not sure i understand -- you know, the android platform has more users than the apple plofrmt platform but it doesn't seem google makes money off the android platform or much of it. am i wrong about that. >> well, yeah with, they haven't gotten the kind of hooks into their consumers as much as apple has. so the ecosystem hasn't been as powerful and when people get on the apple ecosystem, especially on iphone, it's really hard. it's really sticky and hard to get them off that platform so android hasn't quite figured that out to the same degree with all the ancillary services and other per i havele. >> and apple is a closed universe in other words, nobody makes --

nobody but apple makes products using the apple software lots of companies make products using the android software and it doesn't seem like google gets the -- or alphabets gets the benefit of that as richly as maybe they should. >> i would think about it as very successful defense, though, tyler. what google is able to do is actually very successfully defend its position amid the shift to a mobile ecosystem, because it's android operating system is on all of the phones and they come preloaded with google search. and with yupt youtube and other products of googles. and while the -- you're not looking at direct revenue apart from the phones that google itself sells i think this is -- this has been if you look at a business case study over the past ten years, this has been a successful defense google managed to defend

its search advertising and other advertising businesses amid the transition to mobile >> thanks, guys. >> michael olson kevin delaine. good to have you you think about google's anniversary 14th a dutch auction. >> yes. >> extremely unique. all the bankers said it was a failure. terrible awful. >> yeah. >> guess what. >> we don't have a big part of it that's why. >> so mad. exactly. still one more -- wonder why more companies don't do it save a lot of money. >> it's done well. up. >> i think it's -- you if. >> up 270 oh% since the ipo i take that. >> regularing social media, how do you do it not the way companies have been according to the next guest. ane says there is a better way th uni laterally pulling controversial content off platforms. she explains how that's coming up ♪

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their goat battle rifles ready as sites like twitter youtube and facebook make efforts to mod late content and those efforts anger left and right the "wall street journal" ran an op-ed called a better way to regulate the social media. let's bring in danielle thompson, a co-author with the personal democracy forum good to have you here. >> thanks for having me. >> what is the better way? >> people on the left on the right and center are really frustratewood the lack of transparency around content the moderation on the platforms. my cothorough and i we have experience in multistakeholder internet governance. what does that mean? it means various stake holders ranging from government to non-profits to the companies themselves can could create policies share best practices, air grievances sometimes we call this maybe a little

cheeky content congress for the sake of the article. >> who elects the members. >> who appoints them >> well, they're sort of self-appointed in the case of other multistakeholder governance models there are a variety of ways of doing it sometimes they elect members sometimes it's open to the public sometimes there are working groups people with specific expertise can join those it would really depend i have to say it's not a government -- a government-based model. it's an open sort of to the public as well. >> is there any examples where this works elsewhere. >> yes as we address in the op-ed there are icahn which controls the domain name system they.com,.gov, it was a non-profit back in the 90s who said, hey, we need to find ways of including government stake holders be non-profit. we don't want the regulation of the internet to be controlled by the government

so they created the multistakeholder model that's where david and i existed or met, excuse me. >> folks on the right folks on the left there seems to be a lot of anger against social media right now. you could seen take it more broad and say that there is just a very bifurcated, polarized social environment in the u.s. right now. how do you bring the folks together and get them to come to consensus it seems difficult. >> it can be difficult i would say that process is not as reactionary as politics, right. when you bring people together to have an opportunity to say, hey, we have some ideas arndt how we should regulate hate speech here is our ideas. it's not -- multistakeholder governance isn't a courtroom where you adjudicate should alex jones be banned or not banned pd it's hey how do we dress different folks on line who have

violent followings who say things that might be consider hate speech. how do we go about that? that process is very interesting. >> ant problem -- -- and the problem the about you and your group and i want to learn more about the personal democracy group in a moments are trying to regulate or mitigate. >> sure. >> is the perceived lack of transparency on the part of be internet platforms. >> exactly. >> publishesers, factual basis, twitter, snapchat, whomever, a perceived lack of transparency. >> exactly so. >> that leads to what? a perceived lack of due process? >> um-hum. so it can feel like that for sure so sometimes you might have organizations that come to the platforms and companies and say hey we have a problem. we really need to you address it but it's maybe behind the scenes it's not in the public eye when there is actually a forum

that someone can kay owe can say we are putting this in the public record this is a problem. we have an idea how you can solve it that's a way for the companies to hold themselves accountable and learn from each other about how they are going to deal with it. >> the rules that twitter and facebook to the degree we know them have been ever evolving and changing them and making them up as they go along as they encounter situations can you give us an example how this works with sarah xiong at the "new york times" orp alex jones for example. >> again it's about policy in the case of xiong a woman of color repeatedly harassed getting nasty things said to her and she punches back the policy question is how do we deal with folks being harassed on line and kwhaps when they punch back what are the rules of engagement there? what does that mean when they try to say work at the "new york times." >> when they says things like i hate white men, is that a -- is

there a policy response to that as well? is that allowed to stand on its own or you see that in a broader context. >> i see that in a broader context. because sarah is not the only person online who experienced fighting back against when someone says nasty things to her as well. of course that's not a nice thing to say but we have to take these things in context and understand how that might be a bigger policy challenge to address. >> all right danielle, thank you very much. we appreciate your time. >> thank you. >> coming up people are eating out again. spending at restaurants going at the fastest pace on record kwharp the scklily ttos keo benefit from the restaurant resurgence next ♪ today, there are more sensors on our planet than people. we're putting ai into everything, and everything into the cloud.

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american spending at restaurants is growing at the fastest pace on record, according to the latest u.s. commerce department data sales at food service and drinking establishments rising to $61.6 billion in july

so what does this resurgence mean for restaurant stocks joining us now is an analyst bob, great to speak with you today. >> yeah, great to see you. >> so folks are spending more and eating out more at restaurants. who's winning? >> well, it's a mixed bag. this past quarter we certainly some good same store sales numbers, and there were strong numbers in casual dining clearly consumers want to get back out, want to dine i think they're enjoying it right now. >> we had you on about six months on, and everyone was staying home, watching netflix and ordering pizza what happened? >> the key thing i think for seam store sales growth has really come from convenience and i think casual dining is increasingly tapping into finding ways to make it more

convenient with third party delivery, more off-premise, more carry-out programs, those things are really good catalysts not only for casual dining but also for fast food. >> are the chains winning or are independents holding their own >> you know, it's a great question if you look at the recent july data it certainly begs that question the government data suggested it was literally one of the strongest months in years for the industry yet the same store sales numbers coming out of yap trap and black box, some of the indices were abysmal compared to last year. so that suggests to me those sales being captured by the government data are finding a lot more ways than just the same store sales data in other words, there's more numbers going into that versus the year over year shift there's sales growth year over year from new units, menu

pricing, those sales going to those smaller mom and pops that aren't captured by the data indices. >> you mentioned convenience before we have seen a proliferation of delivery service start-ups i would imagine for restaurants they're not going to make as much money when people are delivering and order in versus when they're coming in and buying water and up selling everything >> that's a great point. those inkremtal sales, while they help overall sales, the profitability on those numbers aren't nearlyas good i think a great case in point was we saw applebee's put up very strong numbers recently as a cane however, we've also seen some real weakness across their franchise base

because those franchisees aren't necessarily making as much money profit wise. we're still leaning towards mcdonald's as well as jack-in-the-box. i think the product is going to continue to drive that stock higher >> check please is next. how appropriate is that. check please well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know.

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after a nine-year bail out greece finally ends dealing with inspectors coming to their country. remember pack in 2009 and boom their yields went through the roof, they had to impose all kinds of budget cuts, pension cuts gosh, we spent so much time there covering all kinds of protell uses remember if they weren't going to vote in the parliament there was going to be 400, 500 point move in the dow. lots of tear gas >> it was a crazy time but somehow i had a feeling that greece would still be here

today. they've been around a while. >> they survived >> i just did some travel to portugal which was the first of the pigg countries the piggs, lots of borrowing and nice roads they've built >> and "closing bell" right now. it is time for "the closing bell." i'm mike santoli in for wilfred frost. apple hitting a new all-time high this morning. i'm breaking down the data behind one of the best performing sectors during the bull run here, and it's not what you think. it's not big tech. julie boorstin in los angeles, netflix is testing out video ads to promote its own contact. will paid ads be next? entrepreneur, mother