chinese labor continued to increase and so they're not as reliant on china as they were a few years ago. >> all right, see what happens at midnight, anthony thanks very much for joining me. >> thanks for having me. >> anthony from loop capital that does it for "the exchange." thank you for joining me today i'll join melissa and tyler from "power lunch" which begins right now. >> thank you, kelly. see you in just a moment i'm melissa lee with tyler mathisen who's in chicago today. new at 2:00, president trump says he has an excellent alternative to a china deal. both sides set to meet in just a few hours from now will we get a deal it may not be the bobbi kristina time to go public but uber looks to be going ahead anyway ipo priced after the bell today. what is that stake amid this market volatility? facebook firing back after cofounder calls for breaking up the social media giant we'll debate that. "power lunch" starts right now

let's get a check right now. comments from president trump on trade, it was down on session lows but major averages on track for the biggest weekly declines of the year. now ty in chicago. >> reporter: i'm at the morning star annual investment conference here. in a couple of minutes, we'll reveal the winners of the morning star investment excellence awards for 2019 and the winner for exemplary stewardship straight from the vanguard group we'll hear from tim buckley of vanguard, one of his first interviews on cnbc since taking the reins there a couple of years ago. tim buckley and then for excellency in portfolio management, dan fuss of loomis sayles, 2:40 on the east coast we'll talk about turbulence in the marks, opportunities it

presents and much more from here in chicago at the morning star investment conference. melissa, back to you. >> we look forward to it, ty see you later. a big comeback in the meantime for stocks. dow was down 450 points. president trump tried to calm fears about trade tensions with china. looks like he did. kayla tausche has the very latest kayla? >> reporter: melissa, president trump is leaving his options open with china. he both praised liu he and praised china's president who sent what he called a beautiful letter but hammering china for breaking the deal and not only hiking tariffs this week but targeting the rest of china's imports too. >> it will be $325 billion at 25% and we're starting that paperwork today. so we'll see but you know what? as president of our country, i've got to do something about it and as president of our great country, we're going to be taking in more money than we've

ever taken in. >> reporter: administration officials tell me that president trump thinks the federal reserve is hurting the u.s. economy more than tariffs ever will but a steel stomach for tariffs and repeatedly told ambassador lighthizer, if there's not a good deal, he wouldwalk away perhaps now that this has spilled out into the public, the administration has been on the record about exactly what china did. they can hold them to account and potentially work towards a deal still. >> or maybe seen the reaction too, kayla do you think that's been a factor in anything this week >> i asked secretary mnuchin that earlier this week he said they are not taking it into account so whether that is in fact the case, we'll see certainly other administration officials have said that the fact that the market has been at record highs should give them cushion to do what they need to do on trade, so they're holding a few opposing views there. >> kayla, thank you. kayla tausche. bob pisani at the new york stock exchange

>> reporter: new lights, new cameras, everything. we've been saying all week that a complete breakdown in trade talks with new tariffs in place for months would cause three big problems for the markets the most important thing right now is higher tariffs for longer resulting in lower global earnings, lower market multiples overall and general problems for the markets. that could easily drop the s&p 500 into the 2600 range and by the way, ubs agrees with us on this in a report that was out yesterday, ubs said a complete breakdown in trade talks could cause u.s. stocks to drop 10% to 15%. that is the 2600 area with china stocks dropping even more, 15% to 20% ubs also expects and appreciates risks off currencies the classic one here the japanese yen with the euro and emerging market currencies, the chinese to be negatively impacted come over here to the telestrator. look at what the likely outcome of the trade talk deals are.

again, we've had several possible outcomes. one is a trade deal gets done. that seems increasingly unlikely in a short time. a third is that everybody goes home unhappy and the markets certainly will drop and we talked about dropping potentially 10% to 15% but the hope right now is that we get no trade deal, no tariff hike and the negotiations will continue that's at least the hope for most of the people down here guys, back to you. >> bob, thank you. bob pisani at the new york stock exchange just a few hours until the new round of tariffs kick in on chinese goods. let's take a closer look at what's at stake for both sides and the global markets if a trade deal does not get done joining us, david readel and michael hurson at the eurasia group and served as u.s. treasury's chief representative in beijing great to have you with us. michael, i'll start off with you. you put out a note yesterday saying a 65% probability that president trump follows through on the threat and increases tariffs. given the developments that

happened just this afternoon in terms of the commentary from president trump, does that 65% probability change >> i mean, i would say no but with the caveat that things are extremely fluid right now. it's positive that president trump mentioned the letter from xi and xi sent the letter. it's not so poisonous and positive goodwill into vice premier liu he's meeting this evening. you can look at president trump's other comments as your reporters pointed out and they point to a president who is quite steadfast in his determination that to some extent, no deal is better than a weak deal at this point. so i would say very modestly positive, but i don't think this is a game changer. we will just have to see i still think there's ample reason to be cautious right now. >> david, what are your thoughts

at this point given all the developments and are the markets right to have gone from a down 400 point session on the dow to almost flat at this point? >> well, i think the market's overreacting on the downside and the recovery right now but i think what happens today is the talks progress. there is a statement late in the day that says we're going to hold off on the tariffs for now. we're still going to have that dangling sword over people's heads but we're going to hold off for now. i don't think trump has the kind of appetite for market volatility that he's seen in the last week or so. the market has showed him loud and clear what they think about additional tariffs and i think he's going to be reminded that consumers and companies pay tariffs, countries don't, and so this pain is hurting u.s. companies as well as u.s. consumers. >> michael, there is some significance in the fact the president will have a phone call with president xi. do you think that's a sign the two leaders themselves will be involved in hammering out or

maybe even sealing some kind of trade deal >> well, i think this has to be handled to some extent at the level of the leaders the chinese vice premier is unable to break the impasse on his own, and it looks like really the nub of the issue right now is this u.s. insistence that china may change to its part of the trade deal which gets to china's own view of sovereignty and resistance to being bullied by the u.s. or other foreign powers these are the issues that the trump/xi channel is critical xi is not going to be in dc today, which means that trump will not have to face him and may decide to go ahead even if there's a positive meeting today, but i think one thing we should look for is if there is escalation, how wellis that channel working? is there, for example, the opportunity for trump and xi to meet at the g-20 meeting at the end of june? which will be, i think, a really important opportunity for the two sides to deescalate the

trade dispute if it escalates from here. >> president trump said a deal by friday is possible. at the same time, you know, "the wall street journal" points out that vice premier liu has been, i don't want to say demoted but special envoy to president xi has been taken back. should we read anything into that in terms of his actual ability to make progress in these talks? >> well, what we're hearing is that so many of the concessions that were made at the negotiabilitying table went back and got reviewed by beijing and they felt like they were going too far. we have to remember that this month is a centenniary of the movement in 1919 and i don't think xi can be seen as conceding the sovereignty of china at this point. they can't have the u.s. dictating what gets written into their laws and i think that was the wake-up call that took place when these negotiations got back

to beijing and the powers that be in beijing said, whoa, wait a minute, that's going too far. >> thanks for your analysis, guys we appreciate it david riedel and michael hirson. more on this turnaround. dow down around 140 right now. we go to tyler at the morning star awards in chicago what's coming up >> reporter: and we will talk with tim buckley, the chairman and ceo of the vann guaguard. the trade tussle between us and china and the legacy of jack glvo all that and more when we return here to chicago on "power lunch. here's one you guys will like.

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show me the best of amy poehler, again. this time around... now that's simple, easy, awesome. experience the entertainment you love on x1. access netflix, prime video, youtube and more, all with the sound of your voice. click, call or visit a store today. welcome back to chicago in the morning star excellence award 2019 edition and joined by the winner in the exemplary stewardship category and that's tim buckley of the vanguard group and tim, you represent the vanguard group as the ceo. congratulations on the award. >> tyler, thank you. >> i know jack bogle for a long time and would be proud to get

this award what did bogle's legacy mean to this company >> so many people think of his legacy as the pioneer of indexing, he's really so much more he's really what this award is about. putting the client first. >> he always talked about giving the investor a fair shake and that is what you all have strove to do through low fees >> we're driving them lower and lower. index funds, people have matched us on fees but fees can come down more on active management in places like advice and morning star did a study and they looked at across complexes and twice the feed level. >> some of your big competitors have come in with zero fee entries in the past year that must have shaken you up a little bit. >> for us, putting the client

first in everything you do and make sure it's easy for us our structure -- >> it's different. >> very different. we're owned by our clients funds own vanguard which means we don't serve anyone from the outside. public shareholders, private families we only serve our clients. they're our shareholders they're the owners of vanguard so when we have a good year, what we do is we share that with them in two ways one -- >> keep the costs down. >> give back profit in the form of lower expense ratio and reinvest in the business better services for that. >> news of the day a big trade deal either going to happen or not or whatever. we don't know. >> i feel like i've heard that before

what's your best advice today in light of the turmoil and turbulence, not just with the trade deal but north korea, with iran and other things? >> i'm around the markets all around the time. met brilliant people and yet to meet the person who can see the future and from that aspect, stick with it. you have your bonds and portfolios for ball stering a storm. >> the president said moments ago in terms of economic risk to the united states, the u.s. federal reserve is a greater risk than the tariff tussle between us and china how do you react to that >> the federal reserve has done a wonderful job. what they've done with the financial crisis to today, and focus on what's best for the economy. they have the singular focus on what's better for the economy of the u.s. and for the job market long-term. they've done a nice job of --

>> so you think with doing that, you do not see them then i'm putting words if your mouth and free to distance yourself from them but do not see the federal reserve as a primary risk to the u.s. economy even greater than china >> i think they do their best to figure out what is the information out there? look at that information how do we actually keep prices stable and growing just a little bit and maximize employment? and if you look towards that, they've done a nice job on the employment side and sure, people might want more inflation but man, it beats the deflationary risk we've had a few years back. tune out the noise, keep thinking long-term. >> does it trouble you at all that the administration is critical of the fed trying to maneuver it in a direction or does this just come with the territory? >> i'll leave that between the white house and the fed. that debate between them. >> how do you guys, as you look at vanguard versus the other competition, you're the ones

bringing in the most assets. why? >> the value proposition you look at over ten years outperformed the competition and offer our funds andexpense ratio and if you look at our loyalty scores, twice the nearest competitor that's a pretty powerful value proposition. how many companies out there give you the highest performing product at the lowest cost you'll have a tough time naming more than 2 or 3. >> tim, thanks very much for being with us. i appreciate it. the winner of the exemplary stewardship, vanguard group, and good stewardship. >> thank you >> melissa, there you are. back to you. >> there i am. ty, see you later. stocks bouncing way back at this hour but dow down 140 points 3m and caterpillar affected by trade tensions but biggest percent loser is intel and what's sinking that stock and ask the "trading nation" if now is the time to buy

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welcome back to "power lunch. i'm at the new york stock

exchange upgraded from bmo today. matt with mark your "trading nation" team guys, this is from bad to worse for and most on the way down how does it look to you in terms of where the stock might find support? but down to the trend line from the middle of 2017 and it will bounce off by the near term basis. but the next line from 2016 is another 10% lower. if you highlight the potential with the smh, it's rolling over

and started before this news came out about china and earnings seasons, guided lower and now 50 day moving average. i think still got some more downside as we move through the rest of the second quarter, even if we get a short amount >> relatively cheaper quality steadier you might say and how would you treat this right now >> i think specifically, when it comes to intel, not much to like here strike one, they gave us weak guidance during their earnings release. strike two, they underwhelmed us on investor day. their pc business is flat to declinin declining.

and that's causing intel to reduce prices to compete and not something i want to be a part of we prefer to invest on innovation not price so we're staying away. >> very old company through a lot of cycles. kelly, back to you >> thanks. >> ahead on "power lunch," facebook's co-founder said it's time to break up the social media giant. we'll debate it. plus, uber pricing its long awaited ipo after the bell the key details prospective investors need to know. we're all over this market volatility the dow coming back from the lows of 450 points after trade comments from the president were down 114 we'll have more when "power lunch" returns. >> and now, the latest from tradingnation.cnbc.com and a word from our sponsor. >> during bull markets, traders

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hello, i'm sue herera. here's your cnbc news update at this hour. president trump calling on congress to pass legislation to protect patients from surprise medical bills from out of network doctors. they can cost patients tens of thousands of dollars made the announcement at the white house event on hospital billing. >> we're determined to end surprise medical billing for american patients and that's happening right now. no american mom or dad should lay awake at night worrying about the hidden fees or shocking unexpected medical bills to come. >> the air force test launching an intercontinental ballistic missile off the southern california coast tun armed minuteman three lighting up over theair force base and bug alert. during a campaign event on wednesday, philippine president

r rodrigo was interrupted by a cockroa cockroach. you saw what he did. helped brush off the creepy crawler. that's the news update at this hour ew melissa, back to you >> that sucker must have been about 2 inches big i mean, really >> wow >> sue, thank you. about 90 minutes until the closing bell rings the markets right now, what a comeback we have seen off the back of president trump's comments on the latest in the trade negotiations he's gotten a beautiful letter from president xi from china and a deal might be possible by the end of the week the dow down by more than 450 points half a percent and the nasdaq is off by a third of a percent and the s&p 500 managing to hold above the 50 day moving average, right now, the level is 28.71 down a quarter of a percent. oil, in the meantime, lower on

this down day for the markets. dom chu at the commodity desk. >> let's talk about the 50 day average price for crude oil. west texas intermediate around $61.10 per barrel and wti when it comes to the 200 day moving average and most of the levels $61.69 off two-thirds of one percent and brent crude, $70.37. now that trade discussion certainly playing front and center for the oil markets as well it's been a fairly tight range for both today and still a down day, not as much as it has been. we'll see if that trade optimism turns around the oil markets as well yesterday, we said that we saw a surprise drop in some oil inventories, boosting prices see if that holds this time around guys, back to you, kel. >> i'm still scarred by that cockroach. >> it was like this big if it was on me. >> oh my gosh. >> think if you crush that thing. >> no. >> what it would look like then.

i mean >> anyhow, dom, thanks rick santelli is tracking the action for us. rick >> reporter: you know, we had an auction. i gave it a c- c in cockroach minus a 2 day chart of 30 year bonds it's been pretty much sideways the yield, 2.892 at the auction. it was the last of $84 billion in supply. this auction was $19 billion a very average auction the "c-"but it wasn't bad but let's get to the charts. two day of 30. let's go to where the big action is today foreign exchange let's look at an april 1st start to the dollar versus the yen the dollar at the worst level. contrast that in an april 1st chart with the chinese yuan

moving through all of that and above 112. so the dollar languishing a bit but a lot of action of foreign exchange melissa lee, back to you. >> rick, thanks. rick santelli. facebook co-founder chris hughes believes the company he helped create needs to be broken up the biggest problem is zuckerberg's unilateral control over speech. he goes on to say the company's structure is at fault raising questions about its dual class structure. suggests spinning off what's app and instagram to top saying zuckerberg will meet government leaders this week here to break it down, professor at school of business along with julia boras t jul jul jul julia boorstin. >> i certainly agree with the call for creating a new tech

regulatory agency. there is some damage to facebook from zuckerberg's voting control, but i think spinning off what's app and instagram is not really going to solve the core issue that facebook's business model optimizing advertising revenue is at odds with a lot of other societal objectives and simply splitting facebook up into what's app and instagram and facebook is not going to solve that problem. >> julia, a concern for me, i guess, is that facebook feels the need to say, hey, we are, we can match societal objectives and needs to crack down on things like speech in order to show that it's not an enemy of the public it's in a real pickle, frankly same question to you i mean, which elements of this critique do you think might move forward? >> well, look. i think it's really interesting we still haven't seen the final fine from the federal trade commission as well as any

changes they might force facebook to adopt in order to comply with the settlement but i also think it's worth noting that the fundamental thing that chris hewes is criticizing here, facebook dominates all the social media as well as communications platform, facebook messenger, instagram and what's app, it's exactly what mark zuckerberg is trying to do right now. he's trying to bring together these different sflervices, not just unify the back end but have these different services really be populated by social updates from each other. so he's trying to integrate them so tightly that it would be impossible to break them up and really making the integration of the services core to his vision for growing facebook in the future so zuckerberg's vision and chris hughes criticism are fundamentally at odds. >> critics of mark zuckerberg would say he's consolidating power by doing that. go ahead >> i think that the, you know,

breaking up facebook by itself isn't really going to solve some of the core issues that facebook has faced criticism for. i mean, yes, facebook has imitated some of snapchat's feature and this is a bit of a damper on competition with social media space but the core issue is dealing with social media platforms led to political polarization the fact that users have very limited if not any privacy rights none of these things are going to be addressed by the breaking up of facebook it's a good sound bite i hear a lot of people say it. elizabeth warren, and chris hughes and my colleague, scott galloway, but it's sort of rooted in 20th century economics where breaking up the company was good for consumers but breaking up the company isn't going to -- >> what is the solution then to all the major problems you outlined, what would you propose? >> i'd certainly first encourage

the government to strengthen the property rights that individuals have over their data i think this is at the core of the problem. if you break up facebook into facebook and instagram, both facebook and instagram will compete intensely for ad dollars. they're actually going to hurt privacy more because they are both offering more and more to advertisers. instead, put in place laws that give users rights over what is and isn't done with their data put in place a new tech regulatory body that is charged with sort of constantly updating these rules to respond to new tech nological developments and really sort of approach this the way you'd approach negotiating with another country because facebook has government-like power. we can't sort of just give them a set of rules and say follow them that's not going to work we have to co-design the rules with them and figure out a way for them also. >> but professor, i'm wondering though, if you force these

properties, force these platforms to compete against each other for users, would that also make them strive for better privacy measures right now, because you're owned by one person basically, there is none of that competitive force to make one be more of an advocate for privacy than the other. >> see, the thing is, we've got a search engine called duckduckgo that you may not have heard of the whole thing is haven't been able to protect your privacy this has caused them to go deeper into sort of limiting consumer privacy rights rather than enhancing them. history teaches us when two companies compete for ad dollars, they'll put the

advertisers ahead of consumers you need the government to correct the market failure and set a playing field where -- >> duckduckgo now and i'm not going to because -- i'm going to google it. the better consumer product julia, there's not a lot of consumer pushback. >> i think the theory that chris is putting out here, if facebook's monopolistic power, a power which said zuckerberg has individual power un-american and unprecedented, if you were to break up the company, that would not only enable those services to compete with each other, maybe different business models like a subscription but enable more competition from start-ups which hughes said, at this point, really impossible per your reference with duckduckgo doesn't have a chance in the marketplace. >> thank you

the market trying to stage a comeback the dow had been down 449 points on the 50 day moving average fast trader of institutional sales at the telestrator at the nyse you're looking at 2860, is it? >> yes, it's the 50 day moving average and over here, the 50, the 100 day and the 200 day moving averages. the 50 is the one in the area of concern right there. we breached it for a couple of minutes or a couple of hours this morning but what you really want to look at is, do you recover from there? so now, if you have a recovery, this becomes your bull/bear barometer for the marketplace right now. so obviously, if you're bearish, you want to see that pressed below there but the problem is, you wind up getting a tweet from president trump or slightly positive news, and you see what happens today.

we almost erased all of our losses so far on the s&p cash but what i think is interesting is if you look back to this sell-off that we had back in december, that left 23.46 and now if you drive that up to the all-time high now, 29.54 if you do the math there, you know, i always quote fibinacci replacement levels, everyone likes a round number if you came down 10%, you wind up getting the 50% retracement over there and that level is going to be 26.50 or so. so if you're in the camp that you're going to see a sell-off, this is what you're hoping for if you're a bear obviously, more people are bullish than bearish so they want to see us rebound the same way that we did today so when you start to look at these level and have the 200 day that's basically 27.45 or the

100 day that's 27, reverse it, 27.45 and 27.75, these two levels, it depends on where you want to pick your poison let's not put the cart before the horse. let's watch on a daily basis and tomorrow especially, 28.60 in the s&p. that's your 50 day that's your barometer, whether you want to be bullish or bearish this marketplace. >> thank you for walking through us steve at the nyse. uber pricing and officially opening for trade tomorrow will it fare better than lyft? that's coming up but first, back to tyler in chicago. ty >> reporter: in chicago, here at the morning star investment conference, they are talking about uber and twade and tweets and all of that but we'll hear from the outstanding portfolio and dan fuss, fixed income investing and we'll find where he sees the dislocations to take advantage of right now

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the morning star investing excellence awards. dan fuss is the winner of the outstanding manager award for 2019 welcome. terrific, congratulations to you. >> thank you. >> you have made a lifetime living and a reputation on taking advantage of dislocations in the bond market, in fixed income where is the dislocation that you're taking advantage of now is it trade or something else? >> well, there's no major specific market dislocation. the dislocations are coming in the geopolitical scene, particularly, trade at the moment that's causing shifts in the market and small and feelings are cumulative but the daily bumps, tyler, are small. there's not a shortage of liquidity but the different part of liquidity in the market to deal with something like this, it's not 20 mega banks anymore. >> so you've got your eye on

this trade situation with china. >> very much so. >> very much so. when you hear, as the president said an hour ago that the bigger risk to the american economy is the federal reserve in the united states, rather than the trade tussle with china, how do you react to that? >> i respectfully disagree the fed is actually trapped by the circumstance that's pretty strong statement because fully cognizant of it. the rest of the world. the thesis behind what's happening here is best expressed in the trap that started merging, market with the dominant part, the emerging part that plays out in the markets. it's the tricky situation but also, as you look around the wor

world, and others have been very supportive european central bank being the extreme example, japan >> you're known for being a contrarian and unafraid to be a contrarian where is the contrarian play right now? >> it's in holding reserves. >> cash? >> well, cash equivalent 2.5% to $3.25. cash equivalent. into the treasury. >> that's the contrarian play right now.

major market dislocations occur? sure, they will. that's the nature of markets it's an unusual time but not at all unique. >> quick thought a lot of people are worried about levered loans and the banks that hold them are you? >> to a degree, yes. you have to be careful is when you're pooled. you can't have pools but you have to look back. the pooling is not a real safety mechanism for you. if you start to get rotten apples with the apples, you're going to have a contagion and that's not fully appreciated at all. >> all right dan, thank you so much you and i have been doing this for 30 plus years. congratulations on your award. >> and congratulations to you. >> thank you dan fuss

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uber set to begin trading tomorrow the ride sharing company reportedly aiming at the mid-point of the targeted rainball of 44 to 50 bucks a share. will it be weighed down by all the market volatility? with us now to discuss are leslie picker and kathy smith principal at renaissance capital. leslie we start off with you what are you hearing about demand >> mid-point of the range or below is where they're guiding investors at this point. so we could see anywhere from $47 a share to 44 per share. i don't know if they will go below the range they have been marketing. i haven't heard anything to that effect but i've been hearing that the syndicate desks among the banks have been guiding investors, that it's about four to five times oversubscribed now, just to put that into context, what oversubscription means is that's the amount of investor demand for stock relative to the amount of stock available. so if you're selling a $9 billion deal for example you're looking at demand for about five times that

those indications and interest aren't biengd. so theoretically -- >> less than 9 x it's a cold deal >> if it's less than 9x -- investors like to see something be at least nine times oversubscribed to feel like you've got momentum going into this, it should get a nice pop on day one if it's more than nine times oversubscribed now, people will look at this and say it's a really large deal, it's hard to cover a $9 billion deal multiple times over but just for comparison purposes alibaba was twice the size of this and was 14 times oversubscribed at this point going into their deal pricing >> kathy, we're reading every single tea leaf out there trying to figure out how it's going to trade, if it's going to be sort of an early bust like lyft seems to be. is there any correlation between now the issue is received in the early days, either before it actually ipos to the first days of ipo to how it performs

overall. >> as leslie mentioned, a very large ipos can be somewhat problematic entering the market smoothly you can look at facebook and how it went and google in addition, we've done a study of the most money-losing ipos ever at the very top of that list is uber second on the list is lyft snap is on that list -- >> is that on an annual basis or total losses or -- >> it's losses for the full year going into the ipo and those companies tend to not perform very well because it's very hard to figure out from here to there what the company's going to do. they really have to manage the process if you're a large money losing ipo >> for the open. but do they not perform well over time? >> they don't perform well >> okay. >> what's interesting, though, is the perception of lyft prior to it going public was that it is a unicorn, it's a hot ipo

so is uber and it was losing money then it's not like the losses are any sort of surprise and yet all of a sudden there really seems to be a change in sentiment toward companies losing money >> we're talking about the difference between the public market and the private market. in the private market you can lose as much money as you want for as long as you want. but when you come to the public market, you have to have some path to profitability. and also i think you have to really deliver on what investors are expecting. you have to really manage investor expectations. and we know that that's been challenging for lyft lyft is connected at the hip with the valuation for uber. so there's no getting around the fact that lyft's trading, which is why leslie's talking about demand and the price range it's no surprise to see they're conservative about how they're going to price this because it has to be connected with lyft's multiple >> we'll be watching very carefully. thank you very much. kathleen smith of rensance and

our own leslie picker. >> up next we're going to look at the trade war from a company caught ride in the middle. ylan mui is at a bicycle manufacturer in south carolina >> this is one of the biggest bike factories in the country. they build about 1,000 bikes a day. but almost all of their parts come from china. llell you why this company is getting crushed by the trade war, next.

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in nine hours $200 billion of chinese goods, if no deal is reached between now and then ylan mui is at one manufacturer that's been hit hard by the cost of importing parts from china. ylan >> kelly, i'm at the bicycle corporation of america it's one of the biggest bike factories in the country this is the assembly line where they put together the wheels, they tighten them up and send them down to the machine to make sure that they're perfectly round. but take a look at the parts that go into this tire you've got the rubber, the spokes, the reflector. all of those parts come from china and all of them would face an addition aal 25% tariff if president trump makes good on his threat to impose them tomorrow the ceo, who heads the parent company kent international, says that would be a direct blow to his business >> we're an american company we don't know how we perceive that china's paying for this we're paying for it. and it's being passed on to our customers and then potentially

to the american consumer >> now, already the company faced 10% tariffs that have raised their costs by $16 million. they passed that on to their retail customers like walmart. guys, that means a bike that would normally sell for 150 now sells for 170. and those prices could go even higher if the tariffs go even more back to you. >> did he tell you, ylan, about whether or not consumers were balking -- or actually, it's time for "the closing bell." >> you never do that >> i never do that >> that's how much she was into the bicycle story. >> i know. anyway thanks, ylan >> "closing bell" starts right now. it is the final hour of trade. i'm sara eyisen and i'm welcome. >> i have to say we've probably taken ten seconds from her quite easily in the past a day for stocks seemingly being whipsawed by president trump's every word when it comes to trade. we'll bring you the latest >>