extended interview we could not wait to talk to him about the state of the markets >> i emg >> microsoft. >> starbucks >> loved it. >> that's it for us. power lunch starts now >> about ig warning. excuse me. from the world's biggest hedge fund manager the east coast is shaping up the worst storm hitting that part of the country in 6 0 years over a million people now ordered to evacuate the carol a carolinas even into virginia we are live with the very latest and back from the brink. almost ten years since the financial crisis are we any safer now what can trigger the next

crisis power lunch starts right now >> the dow up triple digits. s&p and nasdaq cloz up for a second straight day. s&p higher by 15 points at this moment energy stocks leading the way as crude oil rallies with the hurricane bearing down apple, the biggest gainer in the dow right now. its product event kicking off in just 24 hours from now >> let's get straight to the trading action bob pa st ani joins us from the floor of the new york stock exchange the dow moving decidedly higher at this point. bob. >> yes, courts any we have been emphasizing that as trade and tariffs have been the nominal mover of the markets for the last several weeks, this is

a great example of pay look at the s&p 500. we start early on. concerns about china tariff worries out there beijing apparently asking the world trade organization for permission to impose sanctions on washington. we open to the down side then late in the morning we hear comments out of canadian foreign ministers saying trade talks were going well. nothing very specific, but the market just lifts. you see, we're right near the highest of the day take a look at sectors we've got energy up. up partly. this is because oil moved up here of course, we have a hurricane coming on to the carolinas tech has been great. the fang stocks are all up about 1% that's a big helper. retail has been the big mover. that's strong again today. banks are up, but this is a strange little biforcation moving on. rates are up today regional banks like comerica has been doing well. some of the big money center groups gold has now been down ten days in a row that's the worst run ever as far as we can see here look here. this stock, goldman, had a huge run-up in the last several

weeks. bigger than some of the competitors like morgan stanley, jp morgan. that's goldman at the top. it's been coming down a little faster here. a little of outperformance a few weeks ago. now it's coming back down. that's the -- to be expected remember what is moving the markets. bear in mind, the four things we keep emphasizing, number one is china and the trade wars, and that's heating up. that's what's moving the markets. the dollar a month ago been quieter recently tech leadership, i say it's down, but the not out. you saw that today tech doing well. how about the fed rate hikes that's the fourth issue. well, it's not too disruptive at least not yet. zbhiez, back to you. >> the man who overseas the world's biggest hedge fund firing off a warning shot. bridgewater's ray dalio speaking on "squawk box" earlier today about where he sees us in the economy.

we're where interest rates are being staged maybe we have two more years, i would say, into the cycle. something like that. it won't be the same in terms of the big bang debt crisis it will be a slower growing more constricting sort of debt crisis that i think will have bigger social implications and a bigger international implication. >> well, dalios says president trump's tear ufives are not that big of a deal and that china is probably more concerned about its relationship that he goes on to say that he will keep the economy and stocks moving forward the fed should not raise interest rates faster than the market expects what should investors do for now? >> right now whatever is more defensive i would then be in a more defensive posture whatever your strategic asset aallocation issue is you know what your strategic mix

is i would be less aggressive rather than more aggressive. >> as d >> is dalio right? chief market strategist. jeff, chief investment strategist with raymond james. gentlemen, welcome to you both as much as you like the red sox, i know you don't like this analogy. where are we in this cycle how would you characterize the risk to the up side versus the down side? >> that's a great way to put it. it's too easy to use any sports analogy in an economic cycle because there are so many things that can cause a rain delay or get a game postponed, and i think that could be policy, right? policy mistakes. man ta monetary policy or trade policy. the only thing i would disagree with ray here and everything that he said today was that china is a big deal. i think it gets larger, and i think it's a longer game the problem was i thought for a period of time that good news around trade would be

choreographed around the election cycle, and it feels like escalation will be choreographed around the election cycle, and i think it's going to be a drad on the global economy. >> jeff, where do you think we are? i mean, if you think we're in the seventh inning -- i don't know if you do, but will china be the factor that sort of speeds the game along to its conclusion >> that's probably a fair point, but secular bear markets tend to last 16, 17, 18 years. the 1949 to 1966, yes, there were pullbacks, but it didn't stop the secular bull. 82 to 2,000. yes, we had the crash in 1987. didn't stop the secular bull market if you want to start your count from march of 2009 we're going to be ten years into this thing. we ought to have floer seven or eight years left >> well, even dalio said elsewhere that we've been in the seventy inning a long time ballgames to tour the met for even more. why not? can go into the extra innings. i want to ask you about something he said there, and i

didn't hear whether he answered and followed through or not this morning. he said it won't -- with when things go blue, it won't be line the same in terms of the big bang debt crisis it will be a slower growing more constricting debt crisis, but it will have, i think, bigger social implications, and bigger international implications that sounds pretty ominous to me what is he driving at there, art, if you can surmise this snoo. >> the three things that he is bringing to bear in that statement really have to do with the disparity of wealth that we have we've never seen a larger disparity of wealth from top to bottom i think that's a large and growing issue. i this i that that'ssomething that needs to be looked at very directly by policy makers. i think the second thing really speaks more to how much global debt there is. i think he is less concerned about the debt to gdp ratio in the united states, but a lot of the emerging markets debt that's denominated in an environment where we're probably continuing to see strengthening dollar. that becomes -- that gets even larger, and the third thing i

think is, you know, what to do with you were yoo even debt. especially with a lot of the hot spots going on whether it's italy or turkey or any of the things that some of the european banks are exposed to my guess is, you know, it's a combination of wealth disparity that is clear and present in temz of danger, and a lot of global debt and a lot of that is dollar denominated, which continues to get worse before it gets better in terms of strength of the dollar. >> when it comes to the global debt and dollar denominated debt, jeff, one factor, obviously, will be the fed raising interest rates, and right now we have a ten-year yield at 2.977% or so. we're creeping higher. do you think that the fed's graduate pace could actually turn the screws on emerging narkts when it comes to their debt issues? >> it's certainly a headwind, but you're going to get faster growth out of emerging and frontier markets than out of the u.s. certainly, as i said, it is a head wind, but i don't think it derails the secular bull market that exists in the u.s as far as the wealth disparity, i don't know how you regulate

that i thought a lot about it, and i just don't think that the policy could be put in place to regulate how you pull people up from low earners into middle class earners. >> gentlemen, good discussion. we'll have to leave it there art hogan and jeff, appreciate it well, you have a news alert at the bond market right now $35 billion in a three-year bond up for auction rick santelli tracking the action at the cme. okay what's the demand like this on one, rick? >> well, i wish it was better. i gave it a charlie minus. a c minus. just a smidge below average. first leg of refunding that would be $73 billion in total. the auction sequence today threes, tomorrow tens, followed up by 30s. 2.821 was right around the middle of a wide one issued bid offer spread 2.68 bid to cover. that's a bit light

46.3 on indirects. also a bit under the 49% ten auction average. the only thing that overperformed just a little or directs a 10.7 dealers take a rather large 43% of this auction so c-minus today. next on tap, drars 23 billion. ten of this year note is tomorrow melissa lee, back to you ten years after the fall of lehman brothers. how the financial crisis spread from wall street to main street. a look at whether we are any safer right now. as a category four hurricane bears down on the carolinas, our own jackie deangeles is in the path of the storm with a look at how residents are preparing for land diagnosis fall. jackie >> hey, melissa. well, those evacuations are underway as this storm strengthens and it's approaching the bull's-eye right here in wilmington, north carolina right now gasoline demand exceeding supply no surprise there. i'm going to tell you after the

break if residents are going to have what they need to get out of here in time. it's all coming up o"per nch.n ow

>> storm isaac are churning. florence bearing down on the u.s. east coast. jackie deangeles is at the new

york stock exchange. >> east coast and down here especially in north carolina has seen in over 60 years. right now states of emergency have been declared in north carolina and south carolina. emergency evacuations are underway mandatory evacuations of the coastal areas are going to probably go into effect later tonight. a couple of things to think about as the residents, the people that work here, people that are visiting and were on vacation have to think about when they leave is if they're going to have enough gas to be able to make it inland right now we're hearing from the executive director of north carolina petroleum and convenience marketers association. he is saying there are spot outages. that's not surprising when so many people are trying to leave that you would have demand exceeding supply he also said there haven't been any problems refilling stations. as long as people are patient, as long as they try to exit in

an orderly fashion, they will be able to do so. that's why local authorities and state authorities have been saying let's get the show on the road sooner rather than later. the president tweeted a little bit earlier as well that he had spoken to the governors of virginia, north carolina, south carolina as well, that the federal government stands behind these states as they prepare for this storm too, but remember, there has to be some cooperation. deposit can only do so much if the residents don't help out and try to seek safety most of the folks that we spoke to said they were going to do that i think there's a plan they are concerned that this could be a monster category for stornlz.

>>. what kind of damage are we looking for in the mid-atlantic. joiks now is dan leonard, senior energy meteorologist at the weather company, and, dan, hopefully you are able to hear some of jackie's report talking about the shortages at the gas stations and so often with hurricanes we're talking about refineries, but that's not the case this time because this is not a gulf hurricane this is on the atlantic crops. it's really something more of a concern when we're talking about commodities. is that right? >> yeah. when we typically deal with a gulf hurricane, then we talk about when we're talking about futures market we're talking about commodities like energy, oil, gas. now we're looking at crops in the carolinas.

there are a big crash crop there with cotton, and it's a critical time for cotton right now. we did have a great season out in west texas. that's from really heavy flooding rains that looks like the system will stall somewhere over in the vicinity of north carolina for several days. probably going to be a lot of damage to the cotton crop there in eastern north carolina. >> we are seeing this, of course, is a category four a potential to be a monster is the term that's being used, an potentially the biggest storm that we've seen in this area in 60 years or so do you have any precedent for us to understand what could happen to the price of cotton if this inland flooding does get as bad as some fear >> yeah. this is not really a precedent for this one let's face it, north carolina is no stranger to big hurricanes. we have so many hit this region

over the years the big difference in florence with these other ones is, number one, the trajectory coming in. it's coming in at a southeasterly course remember, north carolina sort of sticks out and most storms come up from the south, so you get sort of a glancing blow. the storm keeps moving you get a little bit of damage, but it moves on. this storm comes in from the southeast. it's going to be stronger damage, stronger storm surge on the coast than you would normally see from a southerly moving hurricane also, inland when the storm stalls this does not have a lot of precedent. you have a lot of storms thrown out the past, like hugo and storms like that this one is going to be very unique, and it's stalling feature, and i think ju assist important as the severe damage, they're going to take on the coast is the inland flooding that's going to be a major, major issue in this upcoming weekend, i think >> how much of the crops are still in the ground, and can farmers go and at a real fast pace get a lot of the stuff out that they need to?

if it gets wet and doesn't dry out, it that can ruin the crop that's a real possibility. you can have three, four, five days of heavy, hefd rain, standing water that's going to be a real issue, i this i thsh. that's really the problem. >> as the strong ssz are said, when the cotton balls get roton, you can't pick any more cotton >> is that really a song >> that's really a song. >> how appropriate >> with potentially feet of rain that is going to be coming, dan, beyond the crops, what about infrastructure

we are talking about wilmington, which is your biggest city, which will be very close to landfalling point. i think the number one issue we have on the coastline, if you notice the curve of the carolina coast, north carolina coast, it's interesting because with a southeasterly -- or a storm coming in from the sooets, you are actually going to push a lot of that storm surge right into that curve between cape fear and cape lookout that's a problem number one. a lot of storm surge you don't normally see that on the carolina coast for the big hurricane. going to be a lot of coastal damage then, number two, ip land, when the storm stalls out somewhere in north carolina, southern virginia, inland cities i think big problems raleigh, maybe charlotte, maybe richmond those cities are going to have a lot of issues with flash flooding over the next few days. this is going to be all inclusiv inclusive. nobody is going to escape this it's going to be major issues all around >> just hope that folks are heeding the warnings and getting out trying to get themselves to safety ahead of that storm thank you so much, dan, with the weather company. appreciate it. >> any time.

>> all right a new report out on how america's small businesses are feeling about the economy. the numbers are startling. we'll bring them to you on the other side of this break and tell you what it is all signaling. if you're waiting patiently for a liver transplant, it could cost you your life. it's time to get out of line with upmc. at upmc, living-donor transplants put you first. so you don't die waiting.

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>> this is a nearly 1 point increase this also breaks the previous record of 108 set back in 1983 now, this chart is a look at optimism for the full year holding well above the index's historical average of 98 the biggest gains this month contributing to the jump pranz to increase inventories and make capital outlays and increase employment. to the down side, the biggest drops were in those who expect higher real sales, expected credit conditions, and those who expect the economy to improve. labor quality, though, remains a stubborn issue for small business in the number one spot yet again this month as respondents single biggest issue followed by taxes and government red tape and regulations what's interesting is obviously they can't find skilled workers or even unskilled workers to fill positions, but when will this actually impact optimism? he doesn't think it will hit them any time soon because profits are so high. they're doing so well they want to create more output, and they don't have the people to fill those positions to make that happen >> you said that they're

increasing inventories is that because of trade we have a lot of small businesses here. is "power lunch" concerned about the tariffs? >> i don't think there's a trade tie-in that's the and pgs that sales will continue to increase. one thing about trade is we asked, you know, bill if trade and tariff concerns will weigh on small business optimism they have a less trade incensive minimumship, and they haven't seen it in the survey yet. know is in wait and see mode right now. the companies looking for workers, 89% thought they could not find skilled workers, right, to fill the jobs are they willing to raise wages? do they think that's an issue at all? >> that's a great question wages have continued to increase over the time because they're trying to hang on to the people that they actually have. zo ten years ago lehman brothers collapsed. it was the largest bankruptcy and pulled the world deeper into a massive financial meltdown a look behind the scenes of the

crisis through the eyes of the people who lived it. plus, are we any safer now power lunch is back in two

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>> here's your cnbc news update at this hour president trump traveling to the flight 93 national memorial in shanksville, pennsylvania, to honor the 9/11 victims he and the first lady touring that memorial overlooking the field where the plane crashed. >> a piece of america's heart is buried on these grounds, but its place has grown a new resolve to live our lives with the same grace and courage as the heroes of flight 93 >> evacuations are underway in the carolinas as residents and tourists flee hurricane florence the category four storm is expected to make landfall friday morning. almost one people will be evacuating the carolina coast in the coming days.

and the northern lights dancing in the skies over the arctic circle for several hours last night in northern finland the lights are the result of electrically charged particles from the sun entering the earth's atmosphere they are so beautiful. that is the news update this mauer. courtney, i'll send it back to you. >> so cool i'm hoping to see that one day the major sbeks actually staging a rally here led by 2% surge in apple shares. the dow up triple digits higher by just about a half a percent or month the s&p and the nasdaq both up for a second straight day. telecom and energy are leading the s&p sectors at this hour energy leading as crude oil soars 3% ahead of hurricane florence making landfall utilities and consumer staples, those are your biggest laggard s s. >> all this week cnbc stays a look at what has and hachbts changed since the lehman brothers crisis. toll we'll premier andrew ross

sorkin's look and jaime dimon talks about where he was when he heard. >> i called up my whole operating committee. i told them we were about to have a catastrophe take place. all hands on deck the next day i think saturday everyone is at work we had work forces and teams going through every single part of our exposure to every single part of which we've been through before i think i called my board that saturday and said we have a national emergency, and i told them what it was, and i tried explain it to them and how bad it could get >> when you told them how bad it could get, what did you tell them >> i said you're going to see the worst week ever in american financial history since the great depression, and my opinion leman was going to go bankrupt and that iag is a possible, and it might be the domino effect after that, and that we jest don't know how bad it's going to get. someone asked me, well, what does it mean for -- well, each one of them is an exposure, but none will cost more than $is

billion. we were actually fine. >> do you remember hank paulson saying why he was not at that meeting? >> the industry, which would have been a great outcome if we could have done that, and had we -- another week, it's possible we could have done it in the end there's a reason why. >> tune in for andrew ross sorkin's documentary "crisis on wall street, the week that shook the world. it premiers tomorrow 10:00 p.m. eastern time only on cnbc. what have we learned over the past decade, and are we any safer now? joining us are two people to talk about that. hal scott, director of the program on international financial systems at harvard law school he will talk about what might trigger the next financial crisis and sebastian, the paul a. volcker, senior fellow for economics at the council on foreign relations.

welcome to both of you you wrote a piece in the washington post, skps one of the lines caught my eye as people tried to attribute blame or responsibility for what took place ten years ago this week. you say countless diagnosis of the crash have presented faith in efficient markets as a chief culprit observing that markets aren't rationale because people aren't either. i thought to myself, but i felt like people were highly rationale in the lead-up to that crisis because what they did was they took advantage of what the rules allowed them to do >> you are right, but at the same time they -- it was not perfectly rationale even though the rules. a lot of people who held equity in their own companies took risks that cost them personally. rationality was not perfect. i think a lot of people jumped on that and said, gee, we cannot

believe in the efficiency of markets because people aren't efficient. that was held up as a revelation my point in many washington post column was simply that we had known because of behavioral economics, behavioral finance right back to the 1980s that people could be irrationale, take too much risk and so fot. that's not the new thing one should fasten on, and, in fact, the more important insights about the political constraints to regulation, and that's really what i think caused the problem. >> right the irrationality that blew them up is something they didn't anticipate before i turn to hall. one more question. as i think back on this, i -- i think specifically about the mortgage crisis. i think the fact that the baipgs are allowed to sell those mortgages so quickly and get them off their balance sheets was a main contributor to this

whole thing. they didn't own the mortgage they didn't have the risk anymore. they just got the origination fees and whatever fees they got. that was one of the prime contributors do you agree am i on to something, or not >> i totally agree with that, and i would just add that the organization of the american regulatory system made it possible for risk and mortgage origination to switch around so that it was in whichever part of the system was going to be most lightly overseas for example, you could regulate banks, and the fed sort of tried to do that and say you should have capital and so forth. then mortgage origination would move to nonbanks these mortgages would be packaged and sold to other folks who were not under the regulatory net, and so i think one lesson that was failed to be picked up would have more consolidation of regulation, and although we do have the financial stability oversight committee, i haven't met anyone

inside the system who believes that is totally effective, and i fear that this system of multiple alphabet soup agencies allows financial actors to continue to game it. the balganization of the regulatory bodies and the balkanization of the financial system in and of itself. you have multiple agencies regulating the financial system, different parts of the financial system, and maybe they don't overlap. if you regulate, let's say, estonia very rigorously, does that protect the rest of the balgans from infection, and i'm thinking the banks are in better shape than they have been in ten years, maybe ever, and yet, have we really -- have we really solved the problem here? >> wlapz if we have a crisis

we have taken many measures to make it less likely, as you pointed to banks have higher capital. we have more liquidity, et cetera the real problem is we're still going to have them despite what we try to do to resist them, and there we fall short. it's been very contracted. the fdic's power to expand the deposit insurance in a crisis has been taken away. the treasury power to guarantee money market funds in a kries have been taken away tarp has expired if we go back into a crisis, i hope we don't, but, you know, history says we will the real problem is we have lost

important weapons to fight the crisis if and when it occurs >> what was the legislation that took all of those powers that -- those tools out of the tool kit? what was it? >> would you say the people that want to roll back some of the regulatory efforts that were embedded in dodd frank are misguided or doing the right thing? >> no. you know, i think what dodd frank did arguably well was strengthen our ability to not have a crisis. sort of prevent a crisis again, i would say, look, you know, we've made the buildings more fire resistant, but that doesn't mean you abolish the fire department. we took important steps to abolish the fire department. dodd frank is really a mixed bag. at santee, it did some good things ex-post it did some bad things >> last word to you.

reacting either to what hal said or what you think the whether you believe the balganization of regulatory agency and regulatory capture of agencies in congress by lobbyists is the biggest threat that might lead to another crisis >> i agree with what hal is saying if you think about the contrast that the european union and the crisis and, therefore, the recovery, and then the fed which did top and so forth, and it was a faster recovery in the u.s a lot of that had to do with the fact that in the u.s. it was possible to improvise new tools and new ways of sticking band-aids on the system -- it wasn't clear that it had authority to do something like aig, but there was room in the law to go do it. in europe because there were more constraints, that was not the case i think it shows you the discretion is the key thing when you have a crisis. >> gentlemen, thank you very much great discussion really enjoyed it.

>> thank you >> thank you >> you bet, guys thanks in the aftermath over the financial crisis, the single family rental trade was supposed to be a short-term play, but the sector is thriving, and that could have major implications for the rental market in the years ahead. diana olich is in washington with a look ahead at what's next hi, dooirna. >> hi. that's right in the first part of this play, the thought was that once home values recovered, which they have, investors would sell their homes at a nice profit and call it a day well, that was not the case. now there has been a considerable amount of consolidation in the sector, and two big reets remain wrrks american homes for rent and invitation homes invitation is the largest with just over 80,000 rental homes. it not only continues to buy homes, and also sells its homes out of its portfolio this is how the company expects to remain profitable going forward as housing market dynamics change.

>> that's a very easy thing for us >> they want to keep renters engalked with the product. that could mean upgrades for smart homes. new technology to help with management and special apps so that renters know exactly where to go when there's a problem back to you, guys. zroo very interesting stuff. the stocks of these two reets really did underperform early on what's going on now? >> thrower doing much better in just the last twloe years, and that's because we've seen investors results of the company. they're seeing good profits and good operations. they have streamlined all of their practices.

thank you very much. diana. really appreciate it >>. >> cantor fitzgerald, the firm that lost hundreds of employees commemorate this is day by turning it into a tradition of giving and hope. they're raising money for charities around the world with the help of a few famous friends. that said, jenny mccarthy on the phone there working on the phones we'll take you there live, and you can tune in thursday for cnbc exclusive billionaire investor david at 100.meaersar of appealoo th's2: p. stn time thursday

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employees on the attacks of the world trade center every year on this day they donate 100% of their global revenues to charities around the world. raising roughly $147 million to date leslie picker is in new york at the cantor fitzgerald global charity day. >> hey, melissa. september 11th is always a painful reminder for cantor fitzgerald and the tragedy that befell the firm on that day. each year for the last 17 years it doesn't get any easier, but for the last 16 years the focus has been on charity and with this charity day where as you mentioned all of the revenue from their trading division goes to charities it's incorporated actedors, athletes, world leaders all coming on to the floor to make trades that then go to the charity of their choice as well.

>> september 12th i went down to my old firehouse engine 55 and then i went to the site with them and was down there for about a week >> i was prime minister of the u. k. the time 9/11 happened, which, by the way, was also the worst terror incidents in terms of british casualties that we've ever seen. >> is it does something good for other people giving back, making sure that out of something that was a very evil act comes actions that are good and positive and helpful for others. >> now, i spoke with the ceo howard lutnick about what has changed in 17 years, and he said

that the firm has quadrupled in size there are business that is they weren't in in 2001, and for him that is really the epitome of rebuilding guys >> it's really hard to believe that it has been 17 years to me. i mean, we've remembered it here because we live in this area, and everybody around the country does, but particularly those who witnessed it, it was so vivid. 17 years where do the $140 million raised over the years of this charity -- where do the proceeds go do they go to the families who were victims, and is the company still involved or in touch with the victims' families, or do you know >> absolutely. >> 658 employees that were lost and their families over the years it's evolved quite dramatically it's gone to relief funds for terrorist attacks, families of terrorist victims. it's gone to relief for

hurricanes last year puerto rico, they were talking about how they are going down there to do some charity work down there after today's event. it's really expanded to be just for victims of all sorts of relief, give them relief for all sorts of disasters, both natural and manmade. >> leslie, any indication of how it's going so far? they give you any update on how the trading revenues are flowing in so we know how much those charities are going to get >> it's certainly been a busy day. that's for sure. each year they seem to raise about $12 million, so i have no indication so far that this year is any different as you guys know, we still have a couple of hours to go. hopefully we'll be able to share with you the final tally as the end of the trading day nears, guys >> awesome thank you very much, leslie. appreciate it. >> all righty, coming up, the president tweeting that ford should make the ford active here in the u.s.? the automaker saying that doesn't make sense we will tell you why

and all this as ford shares hover near a nine-year low power lunch is back in two minutes.

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near now a nine-year low a lot of uncertainty surrounding the company's turnaround plan. and on top of it, the president has urged the automaker to make more cars in the u.s there's a lot to talk about. and who better to discuss it than phil lebeau, from chicago hi, phil >> and tyler, we'll talk about that tweet in just a little bit. by the way, 923. once it drops below that or closes below that, then we will see shares at a nine-year low. but the question is, what's in ford's future? because everybody on wall street is wondering when they'll finally hear about the turnaround plan for the company. really, a number of expectations have come up and the expectations among analysts, and these are just expectations, because they're not getting a lot of information from ford that they exit major markets, south america and america are being mentioned most prominently, that they cut 10 to 14% of their workforce, and what's the strategy when it comes to autonomous vehicles they're testing them in a number of markets, most notably down in the miami area but we're waiting to hear from jim hackett. he has said that he's working on

a earestructuring plan to dramatically remake the automaker. but what that plan is, the details of that plan, are unclear. he keeps say we want the company to be financially fit. everybody likes fitness, but they want to know how you're going to get to that fitness there was an analyst's day scheduled for this september they have delayed it they will reschedule it at some point, potentially before the end of the year. and as you take a look at shares of ford, again, 9.23 is the level. if they have a close below that, you're looking at levels last seen back in 2009. >> let's talk about the presidential tweet to bring that, what is it, the active, a version of the focus >> the focus active. that's the next version of the focus, the focus active. the plan from ford was to build it in china, where it is sold, in larger numbers, because it makes sense to manufacture it there. and then import a small number here, like 50,000. relatively low volume and sell it in the u.s. well, with the tariffs, ford has said, that doesn't make sense anymore. the president's tweet alluded to that, also cited cnbc.

but then he suggested, well, now they can build it in the united states and not pay a tariff at all. that's not happening ford is not bringing manufacturing of a low-volume car back to the united states. so once again, ford is the subject of a tweet from the president. this has been going on, guys, for, you know, before he even was elected president, he was saying, look, we're going to change the way ford manufactures vehicles overseas. >> would the focus be subject to a chinese retaliatory tariff in china? or do you know >> no. not -- not if it's manufactured there and sold the there >> right >> it's subject to a tariff by us of 27.5% if it's imported into this country. and that would just make it cost prohibitive. it would not be able to compete. >> the demand isn't there to begin, and that would make it even less in demand. >> yeah. >> all right, phil, thanks very much appreciate it. >> you bet well, counting down teo apple's big event. just less than 24 hours until the tech giant introduces a host of new products, expecting a

bunch of new iphones and watches. what the analysts want to see and what it could mean for the months ahead the second hour of "power lunch" begins after thibrk. mail and packages.ais is at and it's also a story about people and while we make more e-commerce deliveries to homes than anyone else in the country, we never forget... that your business is our business the united states postal service. priority: you

i'm melissa lee. here's what's on the menu for the second hour of "power lunch. the countdown is on. apple's big product event less than 24 hours away what to expect, how to play it, and what impact will potential china tariffs have on the tech giant? preparing for florence we are live inside lowe's command center in north carolina with a look at how the company is getting ready for the current hurricane. and no such thing as sundays. that's how one analyst describes covering the banks during the depth of the financial crisis. he'll join us for a look at the sector then and now. "power lunch" starts right now looky here we've got some green to talk about today. welcome to "power lunch. i'm tyler mathisen glad you could join us on this tuesday. markets reversing course midday, and they are now across the board higher, having their best day in nearly two weeks. nasdaq is leaning the gains as you see there, up about a half a percent. apple, microsoft, home depot, they are your dow leaders.

energy stocks in the green also, as oil rallies nearly 2% concho, less, pioneer natural resources and devon are the leaders there. after a big rally yesterday, tesla giving back some of those gains. one of the biggest bulls on the street throwing in the towel today, saying the stock is uninvestable and take a look at treasuries, the two-year yield hitting the highest level since way back in 2008 remember 2008? >> we do it remember it. we've been remembering it all day, in fact we begin with the big story of the day. hurricane florence the category 4 storm is expected to strengthen later today and make landfall early friday longer florence is expected to produce life-threatening storm surge and winds of up to 130 miles per hour nbc meteorologist michelle grossman joins us now with more. michelle, what's the latest forecast what can we expect at this point? >> hi, there yeah, still a very serious situation. we're going to be watching this hour by hour over the next few

days and this is what it looks like on satellite so just a huge textbook hurricane. we have the center right there, lots of thunderstorm activity. so really, a very powerful storm right now. a major category so we have a category 4, 130-mile-per-hour winds. it weakened a bit. that's because we have an eye wall replacement that went on, and that tends to happen it's going to strengthen though over the next several hours. it's still moving to the west-northwest at 16 miles per hour so we're moving fairly quickly in terms of where it was moving yesterday. still on target to hit somewhere around wilmington and morehead, as a major category 3 storm. right there, a category 4 storm. but as it gets a little bit closer, we do expect it to weaken just a bit. the numbers don't really matter, though it's still going to be a very strong storm, very high winds, very high storm surge, life-threatening storm surge so really something to watch out and protect yourself now if you haven't already. and then as we go throughout the weekend, we're going to see it kind of sit and spin this is going to be very dangerous. we're going to see upwards of 20 inches of rain in some spots

even isolated amounts of 30 inches it's not going end to friday we're going to see problems well beyond this into the weekend, into next week and the weeks after. so we do have a hurricane watch in place you can see where the pink is along the coast, anywhere from the north carolina/virginia border down to south carolina. so we do have a cone of about 320 miles, where we do expect this landfall to occur florence impacts we have a lot of impacts and we are looking at wind first. we're looking at tropical storm winds, pretty early on the highest risk, again, would be near cape hatteras and also wilmington and outside of that, norfolk, charleston, charlottesville, and jacksonville storm surge, i can't stress this enough we are looking -- this is the deadliest form of weather, and we are looking at very strong wave heights here, up to 6 to 12 near wilmington. when that makes landfall, most of the dangerous activity is east of the storm. so that's what we're going to be watching as we head throughout the weekend here, at least friday into the weekend.

and then the rainfall i mentioned, isolated amounts up to 30 inches of rain where you see the pink, that would be the most, so roanoke, raleigh, kingston. but we can't rule out any places just to the left and east of that and i wanted to mention, this is not set in stone we still have some tweaks that will be made over the next several days it has been pretty consistent, which is rare for such a powerful storm but we're looking at the european model, which seems to agree, right near wilmington but i wanted to show you the gfs model, that's the u.s. model and it's usually not quite as, uh, scientific as the european in terms of hurricanes, but we see that it is a little bit further to the north and this is just an indication, really, you need to be on guard if you're anywhere along the southeastern coast we have very active tropics right now, it's just ripe for development. we have warm waters, almost like bath waters, and also very low wind shear wind shear tends to break apart storms and we don't have that in the atlantic so anywhere from the atlantic and pacific and central pacific, we are looking at some very

strong storms and again something we're really going to be watching. the rainfall, that's going to be a biggy. >> two quick questions one, you seem to be saying that this is much more a water and rain event than a wind event tell me if i'm right on that and once this thing comes inland, where does it go next? >> okay, great question. so it will be a wind event in terms of when you have a landfall, you're going to get the wind, you're going to get the storm surge, but we are looking at storm surge heights up to 12 feet. and that is deadly so you really need to take care of your property, your life, when it comes to storm surge it just happens so, so quickly then it's going to move inland we have two highs. we have a big area of high pressure that steering this right to the southeastern coast. and then we have a double barrel high pressure, if you will so a high pressure to the north. and that's going to act like a road block when you're driving down the street, you have a guy stopping you, that's going to be that high keeping that in place so that's where we're going to see that sit and spin, a lot like harvey, where we saw those

flooding conditions. it's not going to race through and then be out of here. it will sit and spin, and then we'll see the remnants move to the north. we had the remnants of gordon we dealt with last week in the mid-atlantic and northeast, just dropped days and days of rain, and we're going to see that once again. so we are so saturated on the east coast that it's going to cause a lot of problems in terms of downed trees and power outages, we could have days of power outages. >> okay, thank you so much >> you're welcome. >> i would say, we're looking forward to it, but we're not >> i know, i know. stay safe. >> thank you very much >> you're welcome. >> well, as florence steams towards landfall, millions of residents up and down the east coast have been ordered to evacuate our own jackie deangelis is in north carolina with more on how the residents are preparing for impact jack jackie >> reporter: hey, melissa, i just heard the reporter before me talking about the deadly storm surge. she said 12 feet i've heard estimations even higher than that while i was inside just before, one woman telling me she was going to ride out the storm. that she had an elderly parent staying with her, that she had multiple pets that couldn't travel in the same car together,

that she's been through storms before and she's just going to stock up and sit through it. i asked her what would happen if her home was flooded or potentially washed away? she said, we'll cross that bridge when we get to it of course, the local and state authorities have been urging people to evacuate and many people have been following that order. at a presser, north carolina governor roy cooper, he had this to say to those folks, like this woman, who are planning to hunker down: >> the waves and the wind, this storm may bring is nothing like you've ever seen even if you've ridden out storms before, this one is different. don't bet your life on riding out a monster. if you wait until conditions get bad, it may be too late. >> and a monster is what most people are very concerned about here they are saying that they're prepared for this to be the worst hurricane that north carolina has seen in more than

60 years let me just tell you a little bit about what's happening outside of the coastal areas, as people are trying to move inland there are some gasoline issues right now. supply is not enough to meet the demand at this point but it doesn't mean that there are shortages. we should be able to see more gasoline come in, in an orderly fashion. remember, we are two days ahead of this storm still. so as long as people are patient, if they want to leave, they'll be able to in terms of food supplies, last time i was at the store, the shelves still had food on them you could find things. the water was cleaned out, new shipments of that were supposed to come in, as well. so people are taking it seriously. they have been making the preparations that they need to hopefully the coastal folks will move inland as they've been instructed and the damage won't be as severe, remember, as everybody has been saying, lives matter more than things or infrastructure and that certainly is what the residents here are talking about. guys >> all right, jackie, thanks very much. jackie deangelis at carolina

beach, north carolina. meantime, we are less than 24 hours away from apple's big product event. it happens tomorrow, where the $1 the trillion tech giant is expected to roll out a brand-new batch of iphones and maybe some other products, as well. josh lipton is in san francisco with that story. hi, josh >> tyler, let's start with those expected new iphones a new high-end model with a 6.5 inch oled display, an upgrade to the current iphone x, and a lower priced iphone with a 6.8 lcd screen, goldman's rod hall says to expect price points for these new phones of $1099, $899, and $949 for that lcd model. also expected, a new apple watch, perhaps with a larger display. idc says apple is the wearable's market leader with 17% share and possibly new ear pods, too apple just told us that proposed u.s. tariffs on $200 billion of

chinese goods would impact its products and specifically did call out the watch and air pods. if and when these tariffs are implemented, he would expect apple to rise prices on these products and protect their margins. the question then, he said, would be what kind of impact that would have on demand. on the company's last conference, tim cook said wearable's revenue exceeded $10 billion across the last four quarters, an impressive number, though, still, of course, a fraction of what the iphone brings in, nearly $30 billion in its most recent quarter alone. melissa, back to you >> josh, why don't you stick around we want to bring in rob sierra from guggenheim partners to discuss the launch rob, great to have you join us here are you expecting all of those variations of iphones that josh had outlined to be released? i mean, is that your expectation? and what does that do in your view to asps and margins >> yeah, so i think -- i mean, from a product standpoint, i think we're all pretty confident. we know what we're looking for, from what products are going to look like. and really, larger screens are

kind of going to be the headline but i think price point is what's going to matter the most. firstly, because it's the one thing we don't really know and more importantly, if you look, for example, at this current year, i mean, iphones are going to show their best revenue growth in the last three years, but it's almost exclusively coming from higher prices so, you know, pricing is really what's driving iphone revenue growth at this point, more so than units so what the prices are for those three new products tomorrow, that's going to be the key, i think. >> the estimates, josh, as you know, goldman sachs had a note out, i believe, yesterday saying that the newest end new iphone could be $699, and if that were the case, that could not be good for earnings what if people actually opted for the 699 -- that could depress selling prices as well as margins >> you're exactly right. the consensus expectations right now for next year are so muted if you look at what the street's looking for, they think 319

million iphone units in fiscal 2019 and if that's right, that's flat over '18 and the street right now, they think that ticks up five bucks from 752 to 757. i think it will be interesting tomorrow when weapon finally get the products and we actually do figure out what the price point is, some real debate on the street of what that is you know, rbc says they think it's $999 for that new high-end phone. and i was talking to gene munster and he thinks it's more like $1,000, $1050 so we get the you couldn't frpr. >> rob, i want to get a sense from you as to how great an impact do you think china tariffs could be if the chinese choose to retaliate, they could potentially stall the sale of new iphones in mainland china. we saw that actually back in 2014 with the iphone 6 the chinese government didn't grant the permits to sell the

iphone at the same time as on the u.s., on the u.s. launch date, and that stalled the sale of the iphone 6s on the mainland if that happens, what is the worst-case scenario? what have your back of the envelope calculations yielded? >> well, that was a different situation -- >> sure, sure. >> simply to illustrate the fact that the chinese government could not give a permit to a u.s. company to sell a product >> yeah, i mean, i think the biggest issue now -- so i'm relatively optimistic that we will get through all of this and it probably won't, you know, mess up one of the world's largest supply chains. but i think the, you know, the worst-case scenario or the negative scenario is that parts cost more and products cost more i would say, at least with apple, that they -- because they sell -- you know, because they have their own operating system and their own platform, they have more latitude to raise prices, to pass along those

higher costs, than let's say, a lot of their competitors who sell more of a commodity product. so i'm not saying it would be positive they had to raise prices to pass along those higher costs, but apple, i think, does have more flexibility than most companies to do that >> all right we're going to leave it there. josh, thanks rob sierra from guggenheim, thanks as well >> all right, here's what's coming up on "power lunch," preparing for landfall we'll take you inside lowe's hurricane command center on how they get ready for the surge they see from big storms like this one plus, back from the brink. ten years after the financial crisis, some say the banks have changed for the better and are safer than ever. are they right all that and much more coming up on "power lunch. (indistinguishable muttering) that was awful. why are you so good at this? had a coach in high school. really helped me up my game. i had a coach. math. ooh. so, why don't traders have coaches?

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in a two-hour window so you're up and running in no time. show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. an hour after starting out in the red here, the dow jones industrial average, higher by 130 points we had been down by more than a hundred. mike santoli and bob pisani are on the floor of the new york stock exchange mike, when i was down there at the stock exchange with you earlier today, we were red things have turned around! what happened? >> yeah, we got this pop starting right around 11:00 a.m. i'm not sure if we're isolating one particular factor that triggered that it does seem as if, you did have this "wall street journal" story about china talking nice with u.s. companies emerging market stocks definitely bounced around that

same time. and i do think in general, the s&p 500 has held the levels of the old highs for a few days of pressure and maybe that was enough to get a trade going. >> i think the key is, it's still china and tariffs that are the marginal mover of the markets. overnight, even at 4:30, the futures went down, that's because we heard reports, china was going to report the u.s. to the wto. the markets moved down, europe moved down on that there it is, the red, around 4:30 in the morning. then around 10:30, the canadian foreign minister came out and said, we've been making progress, it was all very vague, but it lifted. trade is the marginal mover of the markets, more so than the fed or the dollar, which is a little more marginal issue the tech leadership is okay, f.a.n.g. is okay overall but it's that china trade war that's an issue. and mike, i would note today, new lows, ford, gm now, these are not entirely tariff issues, obviously, but, you know, this has been an issue the car companies over in europe

are in terrible shape right now. >> it's been an unusual smattering of winners and losers first of all, more new lows than new highs today, both on the nasdaq, so it's a spotty take, even though you have this little lift so housing way off their highs, brokage stocks way off their highs. >> and a lot of new lows in financials and in europe as well especially some of the insurance companies. >> all right, gentlemen, thank you very much. mike, bob. stocks having their best performance day in about two weeks on the same day that bridgewater's ray dalio warns that the risk of returns have -- the risk of return ratio is more negative and that he would be less aggressive rather than more aggressive right now let's bring in steve misoka with wed bush securities. steve, let me begin with you one of the things in my note that you pointed out, and that kate rogers pointed out an hour ago, is that small businesses,

latest poll, have never been happier or more establish. but they say they can't find skilled workers to find jobs so they're having to pay more to keep the good workers they like. that is wage inflation and that is what tends to drive broader consumer inflation is that one of your concerns and then the response to that is usually higher interest rates. >> well, that's correct. and you know, it is one of my concerns although, where maybe i differ a little bit from mr. dalio is that i think that this time around, it might -- you know, the worst words on wall street, it's going to be different this time but i do think it will be a bit different in that there's a lot of secular forces that are keeping inflation in tow you know, yes, there's definitely labor shortages in some areas, but there's also a technological revolution going on that is going to help lower costs. and then partnered with that,

what i think are continued aggressive central park policies in europe and japan, which will ameliorate some of the fed's activities here. so i think the fed will be somewhat restrained by both of those, and i also think that our friends in japan and europe continue to be very aggressive >> and they will stay loser longer >> correct >> but let me come back at you, steve, with one counterpoint, and that would be that while there certainly are mitigating factors about wage inflation, there may be troubles on the trade front that could raise prices domestically, as well >> absolutely. and i think it's -- you could either win big or lose big on these trade wars if you can come to a quick deal, like you did with mexico, and improve america's position there, that's great news if you're going to run into problems with canada and china and this is going to become a prolonged trade war, that's going to be bad news >> right >> soy understand why he's doing what he's doing, but these deals

need to get done quickly if they're prolonged, it's going to have a negative impact on the economy. >> christian, we've had a little bit of, i think it's fair to say, weakness in some of the broader market indices is this seasonality of the month of september, which we know can historically be a difficult month for the markets, is it because we're worried about trade and going to see what's going to happen after the comment period ends? i mean, what's holding us back right now? what does it mean for the rest of the year? >> yeah, i think it's a little of both. there's uncertainty here, and that's on the federal reserve side, it's also on this tariff side we've had now 53 days straight, going back to june 25th without a 1% move in the markets kind of this subdued market, despite a lot of headlines and i think what we may be in for is potentially a rally here, should president trump be able to execute on these tariffs. and i kind of think it could be an october surprise. he's very concerned about midterm elections, getting a deal done with canada and china would be huge. and i think we could see a rally

in the smp of maybe 5 to 10% on that news alone. >> if it's a rally in the s&p, is there any one or a handful of sectors that would stick out to you? or do you think broad-based, a rising tide could lift all boats until the end of the year? >> well, certainly with a lot more international exposure, but i think technology could benefit. evening that battery metal materials companies could be poised toll rally. they've been a victim of a stronger u.s. dollar and that this trade tariff talk yet their underlying businesses are really strong, when you look at electric vehicle demand. there's a variety of segments that could outdo the s&p, but in general, this 50% or more of revenue coming from outside the u.s. is going to lift the s&p and really catch it up and surpass the russell 2000 >> okay, gentlemen, thank you so much steve and christian, we appreciate it. >> thanks. big box breakout costco, lowe's, home depot all at lifetime highs. will the rally continue? and if so, which name shlde ou b

on your shopping list? we've got some answers, next on "power."

the digital divide is splitting this country. we have parents who are trying to get their kids off of too much social media and computers, and then we have parents who would only hope their children have access. middle school is a really key transition point, right. the stakes start changing. students begin to really start thinking about their futures. what i like about verizon's approach is that

it's not limited to just giving kids new tools, it's really about empowering educators to teach in different ways, and exposing kids to more active forms of learning. giving technology is not a total solution. teaching technology, now that is. welcome to "power lunch. it's time for trading nation big box retail stocks breaking out. names like lowe's, home depot,

costco, and target, all surging the past month and trading at or near all-time highs. this amid a broader rally within the retail space gena sanchez and mark newton are here to join us. okay, gena, duong the hurricane is really at play here with folks stocking up for supplies in advance and that's what's moving the stocks? >> yeah, i do think the hurricane is at play, also because this hurricane and the two hurricanes that are following it are hurricanes that come off the host of west africa those hurricanes have proven to be incredibly destructive. i don't think it's just stocking up, i think people are preparing to have to do a lot of home reconstruction afterward so i do think that is a component. of these four stocks, these are all amazingly defensive names. they have great stories. of the four, i would say that lowe's is a dividend payer and also has a lower p\e. home depot is trading at 24 times, lowe's is trading at 17 times. so i think of those two, i would

go with that one >> that's right we've heard a lot of analysts say that home depot may be the better operator, but lowe's may have more room to run, still. so mark, you're taking a look at home depot from a technical standpoint, looking at the charts for us, is there more room to run in home depot or is it over there? >> you know, i think it's just begun, actually. you look at both charts of home depot and lowe's and both of these stocks have just broken out above the high scene in late january this year. so both are very attractive. i tend to favor home depot only because it's been a longtime leader and when you look on a relative basis, it's consistently outperformed lowe's over time. in the last few months, lowe's has actually done a little bit better, but near-term, home depot makes sense for me, and just as it's breaking out above former highs this week, showing excellent performance. so i expect that to continue as the hurricanes continue. i would much rather buy either one of these stocks versus reaching for stocks like target or costco, which have had huge runs, but are closer to resistance near-term and very overbought >> thank you very much, mark and gina, we'll be watching those stocks closely here as the

hurricane heads towards the coast. for more trading nation, head to our website or follow us on twitter @tradingnation from tools to water to wood, lowe's provides many essentialliessentiall for those getting ready for a major hurricane. so how are they preparing for florence we'll talk to the head of the company's north carolina command center lots more "power" ahead. >> announcer: and now the latest from tradingnation.cnbc.com and a word from our sponsor -- ♪

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let's get a check on the markets right now. what a turnaround we've seen intraday the dow is now up by 138 points, was down by triple digits earlier in the session the nasdaq is higher by about 0.6% and the s&p 500 is up about a half a percent a couple stocks to watch

yum china is falling on reports that hillhouse capital is planning to drop its takeover pursuit. the stock hitting a 1 1/2-year low, down 1.6% to 32.20. and goldman sachs is on pace for its tenth consecutive day of declines, and that would be the longest losing streak since the company went public back in 1999 goldman is the now down by 0.7%. now let's get to sue herrera with your cnbc news update hi, sue. >> hello, melissa. hello, everyone. here's what's happening at this hour we begin with the pentagon marking the 17th anniversary of the september 11th attacks. the ceremony began with the unfurling of an american flag down the side of the pentagon. vice president pence laying a wreath to honor the 184 people who died in that attack. >> today we remember our beloved fallen, whose names are enshrined at this memorial and will forever be etched in hearts of the american people, for as long as this nation endures.

in india, a bus carrying pilgrims from a hindu temple plunged into a gorge this afternoon, killing at least 55 people 30 more were injured india's transportation minister telling local media the driver lost control as he hit a speed bump on the road and on a much lighter note, russian president putin and chinese president xi showing off their cooking skills after their talks in vladivostok the two donned aprons, they cooked up some traditional russian pancakes, and then, of course, you have to polish it off with some red and black caviar and a nice little shot of vodka. what a way to start the day! that's the news update this hour guys, back to you. >> all right, sue. thank you very much! meantime, as hurricane florence churns towards the east coast, residents are heading to hardware stores and big box retailers to stock up on supplies dominic chu here with the companies that could see a big effect >> markets have moved into positive territory, being helped

along by that energy sector, as oil and gas sectors move higher in expectation of what could be hurricane florence as that monster storms move towards the southeastern u.s. coast, we have a number of markets that have been continuing to move as certain sectors, industry groups, and companies showing more volatility storms often mean more preparation and possible rebuilding to that point, companies like home depot and lowe's rising in anticipation of that more retail demand for the rebuild along those same lines, companies like beacon roofing may be positioned to help with rebuilding efforts as well, trading, not moving to the upside after yesterday's gains here electrical power also a concern. generator companies also extending shorter term uptrends, as you can see here. that stock at a 4 1/2-year high. and we'll end with the insurers, which could take a big hit depending on the amount of severity of damage all-state, travelers are getting a little bit of a bounce today after some selling pressure over the last few days, courtney.

back over to you >> thank you very much, dom it takes a lot of planning and a sophisticated supply chain to get the right supplies into the right stores ahead of a storm. for a retailer like lowe's, the strategy begins months after a storm even forms disaster prep starts here at lowe's emergency command center in wilkesboro, north carolina, where weather is monitored year-round, but it runs around the clock, starting up to a week before a storm hits and up to three weeks after. inventory requests from stores are called in and the emergency command center plots the logistics to get the right merchandise to the affected areas. from regional distribution centers to venders shipping directly to stores, or in many cases, from one of three coastal holding facilities, like this one in palmetto, georgia where 250,000 square feet are dedicated to emergency response supplies at all times, including 15 pre-packaged truckloads >> we get emergency response from the command center, telling us exactly where does the load

needs to go. and at that point, we start moving the freight >> they send the list to me, i make the pallet. >> it took about 30 minutes to load this truck up with things like tarps, clorox, buckets, brooms, anything you might need to prepare for a storm now it's ready to go to the stores like the command center, the coastal holding facility is open around the clock in an emergency. >> it's tiring we're exhausted. the product keeps moving it's, it's hard to say, yes, you slept in your car, but i have a home when it's done. >> let's bring in lowe's vice president of store operations, jennifer thayer. she joins us from a lowe's store inland, but shoppers still stocking up before hunkering down jennifer's in charge of the area that will be impacted by hurricane florence thank you so much for being here, jennifer we understand you have experience with lowe's that includes responding to hurricanes like irma, matthew,

ike, and katrina, including time on the front lines as a new orleans store manager during the worst of katrina so you really have experience with storms. i guess, let's just start there. how does this storm compare so far for lowe's and the preparation? >> you know, the team has done an incredible job of getting us ready for this storm i'll tell you, all storms, you know, as they come into land, we prepare from a command center perspective, so we're very in line to what we've done in storms of the past this storm is much larger and is moving very quickly, but i have to tell you, the command center, we activated on saturday, has been on point for us and able to move product about 800 truckloads of product into the locally affected stores. we're thinking about 100 stores, as of now. so, they've done an amazing job. >> how does 800 truckloads compare for this storm to say, other big storms

harvey was a big one last year, different region of the country, for certain. but give us a perspective on that 800 truckloads. >> you know, i'll tell you, it's a mix of product from pre-storm. we're starting to see post-storm product roll into stores along with generators and water. i'll tell you, i just recently went through hurricane irma. very similar as to what we did during hurricane irma and hurricane harvey, as well. we have our local facilities and our holding facilities and our rdcs here close, closer to the exact of the storm i'll tell you, we've been able to turn around product very quickly to our stores and be there for the communities on this storm >> so, what do you sell the most of, jennifer, before a storm hits, and then what do you sell the most of afterwards >> you know, i'll tell you, we kind of look at storms from three phases, right? so the initial phase is pre-storm, so we immediately see generators, cords, tarp,

plywood, water really start to pick up. that's what we've seen over the past few days in stores. as we transition to immediate post-storm, it goes into cleanup for us so it goes into cleanup supplies and bleach and gloves and mops, and then we go into the third phase, which is a much longer term phase of recovery, depending on whether it's a wind event or a water event, we start to see sheet rock, we start to see flooring, roofing, fencing, really start to move for us, the next phase of this storm >> jennifer, what happens to the lowe's stores, the lowe's employees? are you able to continue to operate through the storm? at what point do you have to close down for the safety of the store and the employees' lives, themselves, of course? >> yeah, i'll tell you, our most important thing is to make sure our employees have the time to prep they spend so much time working within the community, helping our communities get on their feet and then at some point, we make

the decision that we need to close our stores and allow our employees time to either evacuate under mandatory evacuations. so a lot of times we follow the governance of what's happening within the community so, for instance, we'll go ahead and close our coastal stores today at 6:00 p.m. to allow our employees to evacuate and make sure we're staying within ordinances, as well. >> does that change as the forecast change? how quickly are you able to adjust we thought that the storm was going to hit thursday night. now it looks like friday morning. does that give you a couple of more hours to stay open for the community? >> it does and we've given the autonomy to our teams, honestly, where there's still demand and they still have product that's relevant to the customer pre-storm. we give them the autonomy to stay open and make sure they're serving the community. we can -- we can move that very quickly within our stores. and within each community, as we see the need >> got it.

thank you so much, jennifer thayer, appreciate you joining us and letting us take a look at lowe's supply chain ahead of a storm. thank you. >> thank you for having us >> the storm giving a boost to oil today, which closed higher by 2.61%. the etf that tracks the financial sector is up 32% in the ten years since layman collapsed. we will take a look at the banks before and after the crisis, straight ahead on "power lch un."

this week maurks trks the tr anniversary of the bankruptcy of lehman brothers leading the markets into the worst recession since the great depression jeff, great to have you with us. i know it's a tough day for your firm, as well, which lost 66 employees who worked in the world trade center take us back to that day, those weeks, those months in the beginning of the financial crisis i mean, it seemed like the unthinkable actually became

thinkable. >> yeah, i think back to the well-known literary times, right, it was the best of times, it was the worst of times. these were not the best of times. the thing that really -- one of the things that really sticks in my mind is what i used to call the weekend rollups. but back at the time, a lot of the matchmaking that would go on between banks with capital and banks that were failing would take place over the weekend, so you had kind of a constant stream of after-the-weekend deal announcements, and it actually got to the point where my wife, tricia, stopped making any family plans at all after lunchtime on sunday, because she would just assume i would have to work sunday night because some kind of a rollup deal would be announced >> you know, the course of history of the banks from that point on, largely shaped by the regulation that ensued from the financial crisis so, when you take a look at the banks and the field that we have today and in what businesses they are, what is a direct result in your view of the financial crisis >> well, i mean, there's been a lot of changes

and i think one of the biggest lessons we learned and unfortunately it's a lesson we keep forgetting and having to relearn is the importance of liquidity. it's not so much, does a bank have enough capital, are they overleveraged. so they have enough cash to get through the real crunchtime. i think that's been one very important change, both regulato regulatorily, but also with management teams they're paying a lot more attention to liquidity management, which i think is a very important key a lot of the other things like higher capital levels and some of the business exits, i think there's kind of some goods and bads there, but we definitely learned some things from the crisis and we're a bit better off now than we were going into the crisis there's a few things we can cite and discuss there, but one underlying point i want to make is, of any points i would make, the one i'm the most confident in is that there will be another financial crisis and we're not quite sure where it will come from, but it will happen again >> terms of the valuations of the banks today versus them, jeff, i used to talk to you ten years ago when i covered the banks and i covered those firms that don't exist today, as you

recall but, you know, we'd always talk about the price-to-book ratio. so when you fast forward to today, do the banks today deserve the same sorts of metrics, the same sorts of price-to-book valuations as they did back then? yes, they are safer, they are more cash on the balance sheet, and their ability to take on risk and make more money is limited, is constrained. >> yeah, it's funny, it seems like it was a lot longer than ten years ago we were talking about banks. but, when i look at valuing banks, and especially with any kind of capital markets exposures, where they're kind of more of a market-to-market balance sheet, i'm kind of used to regressing book value versus the roe they can earn. and we see much lower book values than we saw back then, but also much lower roe. when we come to banks in general, the price-to-book still holds. the place where it's broken off a bit is the really big banks. i think the price to books they're trading at, be it a b of a, a citi, a goldman sachs are

probably too low relative to the roes i think that's something the market's got to get comfortable will and they will get comfortable will over time but generally speak, that relationship still holds up very well >> what's wrong with goldman sachs? we were just talking about goldman having its longest losing streak since 1999, when the company went public. >> yeah, i mean, look, they had a tough year last year, especially in fixed income trading, which is a big business for them they had some problems in commodities. there's concerns that it was more than just problems at a business that maybe there was some business-related issues at goldman. i think we're seeing that that's not the case i mean, they've come roaring back again this year what's, i think, been preventing them from being a standout this year is there are a lot of concerns about trade, right? trade concerns and the impact on global kind of finance and business flows is what people are worried about. and goldman sits right in the middle of that but if we do see, which i think we will see, kind of trade fears subside, i don't think we're going to come into a trade war, the type of capital markets activity levels and backlogs

we're seeing should play right into goldman's strengths i think goldman is oneyou'll want to own into year end. >> jeff, thanks so much for joining us we do appreciate it. jeff harte, sandler o'neill. well, demand for boeing airplanes is soaring, but could supply chain woes give investors a bumpy ride we'll take a look at that, coming up next so, the whole world is talking about ai. big, bold promises like... it'll find life on mars! but here's the thing. you don't live on mars. (beep) you build wind turbines. supply car parts to thousands of cities. answer millions of customer calls a year. like this one: no, i didn't order this. it's terrifying. and that's why you work with watson. hello. it knows your industry, protects your insights, and works with tools you already use. that's why it's the best ai for the job. and works with tools you already use.

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it's ban good day for boeing phillip has the story, hey, phil >> we particularly saw it with the 737. we got to latest delivery numbers. these are for the month of august boeing is not where it expects to be in terms of monthly deliveries total deliveries was 64 planes last month in the 737 category it was up to 48. they would like it to be at least 50, 52, somewhere many that range

they have been seeing slower production due to mainly two issues when it comes to suppliers. slay now started -- and these are planes that are already built but need to be finished out in washington. they are hiring retirees not a huge number but a select number who have special skills to assist in getting rid of backlog. they are expected to be lower than last year they will make it up in the first quarter. with regard to hurricane florence which is bearing down on the south carolina and north carolina they are shutting that plant down today and any of the 787s

that are built, they will be flown out to washington so they will be out of the storm's path and will not be damaged. >> thank you very much let's dig deeper into the numbers. joining us now is carter copeland, founding partner welcome. good to have you with us >> thanks for having me. >> you heard phil lay out the predicament. it has planes that are fundamentally built but no engines to fly them. how quickly can this get turned around or is it getting turned around >> nobody knows for sure just yet. the deliveries we just got show that the problem is not getting any worse. it is a long way to go before it gets better. even though we are holding a production rate flat you know, embedded in that flat rate is a near doubling of the new 737 max variant. you know, those are the areas where some of the challenges

have been seen on the engine front with castings and so even holding flat has embedded within it some challenges ahead that they need to execute on. boeing was with investors, hosted a bunch of folks out in seattle. what we have to remember is those plans are predicated on thousands and thousands of jobs being done every day and on down through the supply chain >> at the risk of geeking out how does this happen how do you get four weeks behind on engine deliveries? >> these are amazingly finely tuned to do specific johnbs on n hour by hour basis you expect it to be at position one in the factory at the start of the workday that plane is going to make its way through on a moving line if that isn't there and there are lots of reasons it might not

be there but if it isn't there because that's quality problem or a part missing that line is going to move. there are thousands of people looking to crank these things off of the line. there were three lines producing 737s two will produce one per day and you have got a production rate that's very very high. it is not tolerant to have any slippage at the front end because it is so finely tuned. >> okay. so should i buy the stock? not buy the stock? >> at the end of the day it is most likely a temporary phenomenon the risk is a temporary stoppage of the line. i think a secondary risk is a delayed ramp up in the next step up mid-next year which is to 57 planes planes a month if you say how do i put this all in the context the demand for airplanes is very

very high. as boeing comes through this situation they will continue to ramp up production we have talked on this about the expectations they can go materially higher than where they are here. the shares are much cheaper on those numbers which you expect they will recover to i think it will be a temporary glitch that we'll say that because chance to buy this stock. >> appreciate it >> thanks, as always >> you bet

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80 truckloads of water at all times at the holding facilities. >> thanks for watching power >> closing bell right now. >> it's time, a former tesla says the stock is no longer investable he'll explain why >> shares of boeing easily outperforming th