it's time to take profits on roku i don't want to freak people out. it's just been good. let it come down and buy it again. >> flo >> pgr, progressive corp >> okay. good stuff "the exchange" begins right now. thank you, scott here is what's ahead of us laying down their terms. the chinese are heading into this weekend's meeting with president trump with a set of terms for a trade deal what are they demanding? will the u.s. give in, and what demands might we have? we'll get into that. also, boeing's fresh woes. new uncertainty about the 737 max return hitting shares today as the faa finds yet more issues now at least one major airline is pushing back its timeline for that plane getting back in the skies. we'll have the very latest plus, amazon has a surprising new partner for deliveries a fizzy drinkmaker falls flat and is your cable company watching you that's ahead in rapid fire we begin with the markets and

dom chu has the numbers. >> i'm not sure if cable companies are watching me but green across the screen. we're off the best levels of the day in anticipation of what's going to happen at the g20 in osaka, japan the dow industrials still up 0.1% half a percent gain for the s&p 500 and two-thirds for the nasdaq tech showing some signs of life in this trade. one particular industry group we've been paying close attention to is the transportation stocks. this particular etf, the ishares dow jones transport. on pace for its best day since june 4th airlines, american, the best performing stock there you can see here, though, we're still about 11% below where we were at the highs over the course of the past 52 weeks. and the stock of the day, not necessarily green. the worst performer in the s&p 500, shares of conagra brands down, near the worst levels of the day after they missed

revenue estimates, missed profit estimates because of weakness in their chef boyardee. >> dom, thanks very much president trump has arrived in japan for the g20 summit where one meeting is dominating the headlines. that's the meeting between president trump and chinese president xi kayla tausche is live at the early morning in osaka, japan, with the very latest for us. in china it looks like is coming with a set of asks >> yeah, the u.s. and china are both trying to shape the narrative going into this meeting that's less than two days away. china, shall we say, retelegraphing some of its earlier asks via "the wall street journal" today. right as president trump was descending from air force one arriving here in osaka, amid those terms china laid out that the u.s. roll back its huawei ban and all the tariffs currently in place and accept lower purchases of u.s. goods.

despite most of those being nonstarters, i'm told a truce is still possible because these are china's terms for an eventual deal not for talks this week. the open question, if a truce is within reach, though, is how long that would last i'm told by two sources familiar with his position that the top u.s. trade official, ambassador lighthizer does not like the pressure created by deadlines though as we know, president trump does every single white house official i speak to and even larry kudlow on the record in the white house driveway today acknowledged no matter how much you try to predict about this meeting it's all up to president trump behind closed doors. >> it will be a long couple of days from now until then, kayla. thanks very much will the president give in on any of these chinese demands? let's bring in fred kemp from the atlantic council also with us cnbc contributor michelle caruso-cabrera. it's striking to me how this language is now changing it's no longer about the deal. it's about a truce or talks this

week what do you think we should be expecting at this point? >> so -- apologies for the nuanced response but i think maybe we get something the market likes some truce as kayla referred to, some agreement to keep talking, but a real deal? i think it's very unlikely and going to be very difficult to come by because the politics in both countries kind of work against it what has president trump lost by being tough on china he sees the economy looking good unemployment is low. and then xi jinping, when you see the reporting that's come out of china in the last few months since the reneging we were told about, it's clear that it looked like xi jinping wanted to outflank the nationalists in his communist party and wanted to look stronger his economy seems to have stabilized i don't see these two having an incentive to come to something right now. >> markets want quote/unquote progress but they're not dumb. if they get that, okay, this is just a truce these are just talks but the real deal is not coming

together, are they really going to buy that? >> well, i think you have to start pricing in, if there's any way to do that, a generational struggle so this isn't about tariffs. this is about two competing systems. these are about two men who are trying to outfox each other, see who is going to blink first. the g20, so friday and saturday, i think is going to be the biggest collective challenge for these leaders since they started these meetings in 2008 in the jaws of the financial crisis and there are three reasons that's the case. one is the u.s./china relationship hasn't been this bad in 30 years. the second is the cohesiveness of the western leaders isn't that great and the third is, if we hit another shock because of the low interest rates and because of high debt levels, central banks and others don't have the wherewithal to stimulate to address it so i think it may be even more perilous in geopolitical terms than what 2008 >> we also -- we've heard from

larry kudlow this morning. and he said no preconditions are set for this meeting he also said the u.s. may move ahead on additional tariffs. so there seems to be some question about what might be coming next for tariffs. for the additional $300 billion worth of goods and would it be 25% or 10% or what have you? should a market be rallying on the idea that those tariffs may not be coming? all of a sudden, you have larry kudlow saying they may still be on the way >> it's impossible to predict at this point this is going to be about the personality of donald trump in the room with the personality of xi jinping to see what comes out and whether or not we get this truce that's been possibly telegraphed, right if we get that truce, i think the market is happy with that. yes, they would like something much bigger. but to fred's point, he's right. this is a generational shift we want the chinese to be different than they are. >> right >> which seems unrealistic

>> yes >> and, fred, i also wonder if -- and this is where they had an interesting point in the column maybe our approach to huawei has not been the right one the better way should be to entice them into our markets and use that as leverage as opposed to banning them. regardless, that chip is on the table and the chinese want that situation fixed. should the u.s. allow for them to be operating like normal here >> hank paulson, former treasury secretary, wrote about this in the financial times. he says the u.s. has the wherewithal to put huawei out of business if they are totally cut off. and that may be true but he adds to it that at the same time, we are risking trying to decouple our world, the chinese and the u.s., and many countries in the world just won't come with us we may find ourselves maybe not standing alone but not standing with a lot of others there's a real danger if we go in this direction that china would be hurt badly over the short term but we might be hurt very badly over the long term

one deal that one's heard about is a huawei deal where huawei could have access to u.s. markets. but it would be severely restricted and you could have all sorts of security checks and balances within that but i just don't think that's where the president's counselors are ready to go at the moment. >> go ahead. >> to your point, jenkins has written, about what would you do better to bring them under the tent okay, you'll have to develop and test here in domestic labs you'll have to list on a u.s. stock exchange and, therefore, you are going to be subject to u.s. rules or better to use that and then it would be a cost to them if they violate it. switch the psychology. so there's been a lot of discussion you can't make huawei a part of the negotiation if you think they are a national security threat is there a way to thread that needle and counter the concerns about the security threat using our regulatory framework >> it's interesting the three major demands are lifting the ban on huawei, rolling back the

tariffs, which again seems unlikely and also the chinese saying we want to agree to less purchases of u.s. goods. i feel like those big, big demands are kind of learned trump's style of negotiation we're going to go big and bold with something seemingly insurmountable and that way the ultimate compromise we move it more -- that that center of compromise is moved more towards us and what would have been otherwise. >> and finally, fred, it's interesting that on here they're not necessarily saying their terms are -- we're not going to change our rules on intellectual property that may be more subtly part of this we spoke with derek scissors about this if you can't get past the verifiability of a deal you're not 90% of the way there, not even 50% of the way there. >> there are two questions, actually three questions one of them is the tariffs and one could reach some sort of deal there and a truce is not a deal. it's a truce to negotiate.

the technology thing is harder that would almost have to be a separate set of negotiations where you really talk about, how are we going to deal with each other in the world together, alongside our allies and then finally we needed to think strategically, how we are going to go through the next 30, 40 years with this transition of power. there's no doubt china will be stronger no doubt china will be a bigger player in the world. they want more say we want to continue to have our leverage but we're not talking seriously with each other at any of the top levels about how we actually manage this fraught period of transition >> we'll see if that comes up in tonight's debate perhaps thank you both fred kempe and michelle ka br e caruso-cabrera let me bring in paul christopher from wells fargo investment institute and kim forest at bokeh capital partners paul, if there's no deal if this thing just falls apart, the

president or xi jinping walks away, the market sells off, how much do you think? >> the market goes back into that mode where they were. we give back at least a lot of june's gains and try to come closer to where we were perhaps at the end of may. what we really need, what the market wants is for them to start talking again. >> again, we could get reports of talks and a truce and this and that do you think there's up side if that happens this weekend or is that the asumpion that already baked? >> they'll start talking again and that doesn't help a lot. might not hurt but it might not help what would help would be if they made some sort of deal that, in order for the talks to continue, the u.s. would postpone the threat in tariffs that were on the table, that are on the table right now and perhaps the chinese might make some concession on their side that would be helpful for markets next week. >> when we have fred kempe talking about a 30 or 40-year realignment, what does one do?

this is a giant question mark. >> sure. and you know i'm a longtime horizon sort of investor but 30 years is way too long for me i think you have to bring -- you really have to bring it back and i think one of the most interesting things stlat co s t come out is what a hot potato huawei is. and how much china is seeing that as their way to get out into the world with a real product set. and make a difference. and i love all the earlier discussion on trying to put regulations around them by bringing them in to the fold, but i think it's even better than that. let's just let them find out what the market is for their products hair and all on it >> why is that >> i'm a markets person. let's do that. but your original question is how is -- what's an investor to do look, three to five years out there, i like technology it's a global supply chain right now. it can't be shut down just

because of the physical aspects of the supply chain. and you just roll with it. that's what you do >> the question would be, look, the -- you know, does the government need to act as the police force here? there's clearly a market for huawei's equipment it's lower cost. this is a huge problem for a lot of rural telecom carriers. could be layoffs while they try to find better equipment to compete. the market wants this equipment but it's not their role to necessarily in the short term police if there are vulnerabilities that are a national security problem down the road so in that sense, does the u.s. government have to come in and kind of look over the shoulder here to make sure that somebody at least is minding what's really going on? >> i think that's huge and again, my prior experience as a software engineer really lends me to look at this with a close eye. and i agree. but here's what you do the u.s. government can't buy it unless they know it's, you know, a clean system a system that isn't transmitting data back to somewhere else.

that's our biggest fear. and the -- telecoms, i understand that, but how much real data goes through there maybe you just cordon them off and let the market decide. if you're a small rural telecom and you are connected to the world, you can be kind of cordoned off a certain point so that's kind of an answer. bad answer, but it's an answer >> it's a fascinating one. so you're sticking with intel? >> i am. i am because they are way closer to their 52-week low than 52-week high they have some internal problems, but a lot of their supply chain is global it's used throughout the world and there really are few substitutes. there's amd, but they have the same problems. everybody is in the same boat. >> yes and often trading the same way guys, thank you. appreciate it. kim forest, paul christopher

from the investment point of view about all of this here's what's still ahead on "the exchange" -- >> coming up, health care front and center at last night's democratic debate. what was proposed? and what will it mean for the sector if these proposals move forward? plus, boeing's problems continue to pile up as the faa discovers a new safety concern we have the details. and fannie mae releasing its projections for home sales in 2019 and it's not as pretty as investors might hope this i"t ehae"n bcs hexcng ocn

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welcome back the unemployment rate is low interest rates are low the economy is more or less humming along. but democrats in the first night of the presidential debates say this economy is not working for most americans how feasible are their plans for the economy, and what are the key takeaways from night one of the democratic debates joining me are nbc news and msnbc political analyst mike murphy and editor at large john harwood. welcome to you both. john, what do you think was the standout from last night was it a who was it a what? was it the economy health care? what jumps out to you? >> i thought it was a who and a what

the who was elizabeth warren and the what was her joining bill de blasio, the mayor of new york in standing up and saying i would be for abolishing private health insurance. that's part of the medicare for all bill bernie sanders has talked about but she's ducked that issue before. lively debate among political strategists today. i'd be curious to hear mike's take as to whether that would be a crippling position to take in the general election even in the abstract people don't like insurance companies, they want a new health care system medicare for all polls well. the idea of that kind of radical change in a major american industry might be problematic when you get to outside the democratic primary into the general. >> especially because this is perceived as the achilles heel for president trump and for the republican party right now they turned that strength into more of a weakness based on how quickly this conversation has gone to abolishing private health insurance

>> i think they could have elizabeth warren has a strong message for the democratic primary but you don't get elected president by winning the votes you'll get for free in the general election health care is a big complicated system what they don't like the most is enormous, scary change so if you go into a general election saying, step one to my plan, throw away your insurance card, that is gold for the republicans who would much rather be on offense against a warren or bernie on that than defending the fact that president trump hasn't been able to make any meaningful changes in the way people receive health care to improve the happiness of the system so it's one of these deals, short term, might have been a win. long term, vulnerability >> short term it's also an opportunity for joe biden tonight because his strategists are telling me they thought that would be disastrous in a general election so you can bet joe biden tonight who is running as the more moderate candidate, the front-runner in this field, he is going to draw that

distinction with elizabeth warren and try to reassure people, no, i'm the guy who can bring things back to normal. not the guy who is going to turn your world upside down >> broadly speaking on the economy, did they strike the right tone last night? because again, i am listening to a lot of it. and i thought the way the question was framed was interesting by savannah guthrie. 70% of people approve of the economy, including two-thirds of democrats. what do you say to this? they say that economy is working for less and less americans. does that message need to be massaged or does inequality get hammered more as a theme, or what do you think about that messaging? >> well, i think it's the only place they can go. it has a certain grip in the democratic primary, though it's also true while the macro numbers are good, real wages which drive voter opinion have only started creeping p. so a lot of people don't perceive they are feeling this good economy so they have got to have an economic argument.

that's the best one they have. we're in pollster economics. green, high-paying jobs, all that it's not real economic policy yet, and it's all expensive. >> real quickly, john? >> worth pointing out that there's overlap between what she's saying about people left behind and what donald trump said in 2016 he talks about the forgotten people there is a wide agreement that there's a large swath of americans who are not prospering in this economy. the question is, how much change makes sense to try to help them without hurting what is being successful in the american economy. >> and one of the biggest applause lines for the washington governor is when he said, i stand for unions, and i want to help you and i want to be with you and make that change for you. so maybe it was naked pandering or maybe it just reflects some of the populism these days mike murphy and john harwood we'll look forward to part two tonight. here's what happened when asked about their willingness to abolish private health insurance. >> who here would abolish their

private health insurance in favor of a government-run plan just a show of hands to start out with >> that was bill de blasio and elizabeth warren raising their hand the only two if they are the only ones in favor of doing that, does the industry have anything to worry about? for more, i'm joined by les, a health care portfolio manager at esquared capital management and professor at columbia. so what do you make of the direction this is going? >> i think to the last analysis, i think it's health care via slogan, and we've got a long way to go. i think that managed care has underperformed because even if we don't get medicare for all, assuming a democrat wins, and that's a big assumption, there will be additional pressure on the group. >> but i thought the maryland guy made the most interesting point last night when in the middle of this debate he said

you go around and ask hospitals what would happen if they received the medicare reimbursement rate and they'd all go out of business overnight. where does that leave the economics for the health care industry for hospitals, for especially if we're even transitioning slightly in that direction. >> i completely agree. especially in the rural areas where we're running out of hospitals now. there is a bill right now to reduce surprise medicare -- sorry, surprise emergency room bills and even that's getting pushback from hospitals because they are relatively slim margins. probably hospitals need to be dealt with in a separate sort of process. >> would you invest in any of them right now >> no, i absolutely would not. too much uncertainty they are running thin margins. down the road, perhaps, as we see consolidation. but not at the moment. >> so where would you invest in the health care sector >> if i wanted to avoid all of this, and there's a lot of here in this, i would say medical devices, life science tools,

diagnostics, maybe some international companies like twist who makes dna or boston scientific and then the aforementioned health equity. >> which just bought wage works this morning >> people -- companies who are not involved with politics and where you're just dealing with the fundamentals of the business which are quantifiable politics are not quantifiable. >> what would you do with the insurers steer clear? >> how many people do you estimate work at our nation's health insurers? >> there have to be millions who are either at insurers or if you include the blue plans and things like that, a lot. >> millions of people who, you know, we're talking about completely eliminating their industry >> right and you're also disrupting hospitals, too, which tend to be the biggest employers in most congressional districts. so there's a lot of disruption that could come from a radical change and i think cooler heads will

prevail, i hope. and to be fair, the current system is not really sustainable. so we have to do something >> like what >> my guess, my suggestion, not that anybody is asking, but i would say allow the states things like medicaid buy-in and experiment at the state level before we rolled something out on a national level. >> which means those programs will expand no matter what which has implications for the health care system because it sounds like it's not great for profits and for taxpayers because they're costly >> for sure taxes are going to go up. if you pay -- if you insure more people, taxes are going up and costs will go up it's just the math but you could argue that if people have a health care cushion, maybe there would be more entrepreneurial you've seen those economic arguments. >> it's going to be fascinating. we'll be watching. >> it will be a lot of fun >> we'll be watching tonight and in the months to come. in the meantime, you're steering clear of the entire insurer

sector while this plays out. >> right >> les, thanks for joining me. coming up -- another problem with boeing 737 max. could it push the plane's return to service into next year? we'll have those details and the potential impact on the company. the shares are down more than 2% right now. as we watch them in the session. plus, it's not just facebook collecting data on what you doa. there's something else most of us use every day that's doing the same thing we'll tell you what it is and whether you should be worried, next so ...how are you feeling?

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welcome back to "the exchange." here are some of the movers this hour shares of howard hughes are soaring 37% after the company confirmed david faber's report this morning that it is considering strategic alternatives, including a potential sale, joint venture or spinoffs of some of its assets a huge move for hhi today. bitcoin is plunging. it's lower by 18% after crypto currency exchange coin base crashed. this after bitcoin investor mike novograt told squawk box he soiled a little bitcoin yesterday but wish he had sold more and walgreens boots alliance up after beating on the top and bottom line. walgreens rebounded from a difficult prior quarter. now to courtney reagan for a cnbc news update >> good afternoon. house speaker nancy pelosi says the children coming across the southern border are the most

important part of discussing a border bill. this as senate majority leader mitch mcconnell demanded that house democrats drop their insistence for changes in a $4.6 billion border aid package the senate passed. >> so, if this is how he sees things for the future, cooperation is a two-way street. when you're talking about the children, this is a very big priority for us. so we'll continue our conversation they're not threats. fisher-price recalled 71,000 inclined sleeper accessories because infants can roll from their backs on to their stomachs risking injury or death. infant deaths have been reported using other inclined sleep products and a special memorial was held today for the victims of the virginia beach shooter tomorrow marks one month since a man opened fire inside the city's municipal building killing 12 city employees and injuring four others staff members gathered to honor their co-workers that's the cnbc news update at this hour back to you. >> thanks very much, courtney

reagan here's what's coming up on "the exchange. >> ahead -- amazon heads to the pharmacy national beverage falls flat a look at who else could be wauc watching your online habits. and consumers still have a sweet tooth. a cinupn ap"rid fire."

my degree from snhu has helped me tremendously. the flexible class schedules allowed me to go to work full time, run my catering business and be a mom and parent. when i reached this accomplishment, it was like, it's here, it's happening, it's now. we at southern new hampshire university are the ones who succeed. we are the ones who break through.

let's catch you up on a couple stories that should be on your radar it's time for "rapid fire. here to break down the headlines are dom chu, leslie picker and robert frank you can get your amazon packages delivered to your home, garage, car, you name it but amazon is now launching a new in-store pickup initiative called counter and pharmacy rite aid is its first partner this will begin in 100 rite aid stores riteaid could use the help its shares have been shellacked. surprising partner for amazon, unless they are aiming specifically at the urban market perhaps? >> that's a good question, whether they're aiming for the urban market you'd think people wouldn't have as many issues in terms of package deliveries which is one of the key obstacles for -- >> they're cracking down

not tenantses and landlords. >> exactly so that would make sense what's interesting to me is how much time people are still spending in physical stores, whether rural or urban or more suburban environments. people are still spending drastically more time and money in physical stores >> it's pick-up locations. it's a network of places people can actually go. it's not that they want to spend time in stores it's just these physical places exist. you can walk to it, get to it. fedex trying to expand its rural reach by going to dollar general or whatever stores to get their things put forward amazon seems to partner with some of these retailers that have been talked about as being in distress. we talk about sears and the tire center buy your tires on amazon go to sears to get them installed. get this at rite aid >> you think they're trying to exploit the weakness >> i don't know if that's the case they're not going toward like the cvs for this very competitive head-on for some of this

>> and also the terms of the deal were better for rite aid. they want a place with ubiquity in terms of number of outlets where people can go. you walk into the store. order something on amazon. you have a bar code you show to the person behind the counter and pay for it with the bar code and get the item how is that better than going to the store and buying something >> the rite aid probably doesn't carry your -- >> that's what i wonder. are they products that are shipped from an amazon warehouse that have nothing to do with rite aid or products you could also buy at rite aid >> from the shipping point of view, it would seem like it would neither work for rite aid to accept big bulky packages are they going to restrict this to the type of things they'd carry so it doesn't disrupt -- >> it's also economics rite aid has to be getting something out of this. >> foot traffic. >> could be foot traffic or something else or it could be like a swipe fee. something where every package that goes through they collect a cut on or something along those lines. >> i hate going to drug stores,

and the whole idea, the reason i go to amazon is so i don't have to go to the store this doesn't work for me >> but i was thinking where we lived in the city there was a rite aid right there on the corner our building was fine accepting packing ans but a lot of them aren't and it's going to drive people to other locations. >> i also have to wonder what it means for price discovery. if you are at rite aid and you've been able to sell toothpaste for 50 cents more than someone would be able to buy on amazon, people are going to be like -- they'll see it and order their cheaper toothpaste go into rite aid and say i just bought that for 50 cents cheaper. >> and pick it up. the ultimate disgrace. lacroix maker national beverage is reporting a quarterly sales drop the sparkling watermaker is facing multiple lawsuits including a class action suit claiming its ingredients aren't all natural which is an allegation the company has denied remember, ceo nick caparella made headlines when he announced earnings with an open letter claiming the poor results were not due to dismanagement nor woeful acts of god he said much of this was the

result of injustice. so another tough quarter for them >> it's a great consumer story because it tells you about the power of branding and reputation, right? lacroix was the only game in town for the longest time. it was ubiquitous. if you wanted seltzer water flavored, that's the can you saw. now within my circle of friends or socially or businesswise, i see a lot more spend drift and bubbli which is a pepsi co product. folks out there know i'm cheap enough where i've had a soda stream for years because i like to make the cartridge and make my own seltzer at home and put the flavor in it if i want to. in a commoditized consumer product, not much you can get away with without consequence if there's not bad pr >> lacroix was such a big trend. this flavored sparkling water. then people looked more closely and weren't quite thrilled with what they saw. i wonder for some of the other new products out there if people

are excited by the concept and maybe try it but as they get a better sense of what those products are, are maybe a little less impressed >> a lot of people are moving to that because it's just natural juice from a fruit that is clearly put into the seltzer water. >> i think i've had one of those. >> there's a lot of questions, whether justified or not, over whether it's truly natural those essence flavors are truly natural or not a lot of people are moving toward what they know is natural which is just juice. >> or water. >> or water. >> so the end result is we're going back to juice? >> sparkling juice like spenddrift like these other brands >> we're going back to juice boxes. >> topic three, facebook and google have a lot of information on where we go and what we look at online. they are getting a lot of heat for it there are other companies that have all of that information your internet service providers. so as washington starts taking a closer look at social media and search engines, we wonder if at&t and comcast will be next. comcast and charter have

specifically denied they are doing any of this kind of tracking, but as this article points out, these companies could do even more in the sense of knowing how exactly you're spending your time online, inferring what devices you use as a result of that. >> so interestingly, exactly a year ago, the fcc proposed these rules and the house voted them down they said they couldn't go forward. and these rules would have prevented the tracking of geographic location, children's information, health information, financial information. social security numbers, web browsing history, app use history, so this was something that was on the radar in washington and they decided to say, you know, we're okay with this because there are such strong lobbying practices for the isps down in washington. >> is it a little bit too early? because a lot of this hasn't been rolled out yet. was there a sense of we don't want to make this an unlevel playing field before we give you a chance to use some of these

tools or am i looking at this way too half glass full? >> this is what the isps pushed back on. you aren't regulating the googles and netflixs of the world in the same way you're looking to regulate us it's not a level playing field with the other internet companies out there. therefore, you shouldn't be uniquely targeting us with these rules even though isps have a much broader access to data. >> comcast is, of course, the parent company of this network >> indeed. >> just want to say that i always have that in the back of my mind >> they are. i know >> but they're the best, so it's fine candy crush still has major addicts. the senior executive for parent company king testifying that he doesn't believe there's an addiction problem among candy crash players, even as he gave evidence that over 9 million customers still play candy crush for 3 to 6 hours a day. >> i see them on the subway. the guy behind me, 45 minutes

between my train from new york city to connecticut. playing something where something was bouncing around on the smartphone he didn't look up except to give his ticket to the conductor for the entire span. >> which is a nice way of passing time on a crappy infrastructure it's a blessing. i wonder about more vulnerable parts of the population. if you have people spending two grand in a single day, here's my only point once we regulated gambling so much in gaming now that it can come to you on your phone, is there, should there be a way of regulating that content to protect the user >> now we know why productivity in america is not -- >> yes, it is. fighting that narrative. >> you bring up a good point and the parent company of candy crush, king, has made $1.5 billion on this game so they are in the business of addiction. so i think they're trying to distinguish between addiction and problems. >> buthere's good addiction. i passed the time on my subway

or plane in a way that was less frustrating because this game is so addictive in a good way, but then -- >> walking or exercising >> when the bad addiction. i'm just saying i wonder if they'll try to make sure people aren't getting themselves into trouble as a result. >> you aren't a libertarian, are you? >> no, no, i am not. nor will i ever be thank you all. dom chu, leslie picker and robert frank shares of boeing are lower today as troubles persist for the boeing 737 max an gund,igtors are keeping the plesrode rht after this (henry) i thought it was unfair. when-- when you hear those words that you get diagnosed with cancer. (osamah) successfully treating it still remains one of the most enormous challenges facing us today. we realized that, if we developed the technology that could take 2-dimensional patient imaging

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earlier this month we spoke with boeing's ceo dennis mullen berg on the xarch"the exchange. i asked him if he thought the 737 max would be back up in the skies before the end of the year >> i do. i can't give you the specific timeline on it we're working closely with the

regulators these are day-to-day activities. we're working with the right pace, but all of this will be gamged by the investment we're making in safety >> and the company now faces new issues that could delay the return to the skies. the faa has identified a new risk phil lebeau has that >> this happens to be with a piece of software or micro processor in the 737 max, separate from the mcas flight control system a failure detected by faa flight test pilots in a simulator so, as a result, they've flagged this to boeing boeing is working on that issue. also today, southwest airlines has said it is pulling the max from its schedule now through october 1st. that means that you are likely not seeing the max, although united and american both have it on schedule after september 3rd. it wouldn't be surprising to me if you see united and american follow southwest's lead and push back any plans for having the maxfli again

meanwhile, the planes continue to pile up it may take 30 to 45 days for some of these parked planes to be spooled up again and ready to fly when the grounding is lifted nobody is sure when the grounding will be lifted southwest as you look at shares, since march 13th that's when the max was grounded look at the stock really hasn't done anything since then they have eliminated, essentially, 15,000 flights. 15,000 737 max flights that should have taken place. take a look at shares of boeing. the company says it's working on a potential software fix for the issue that's been flagged by the faa. nothing concrete yet, kelly, in terms of how long it will take them to fix this issue >> and it is just stretching out. phil, thanks very much existing and pending home sales rose in may. mortgage rates continue to fall, but with trade tensions and global growth concerns weighing, will housing be a cushion for the economy or not we'll talk about that next my experience with usaa

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new home sales took a hit this week as mortgage rates continue to fall and are hitting their lowest levels since november of 2016 i'm joined now by doug duncan. the overarching question is how much momentum do you think the housing market has right now >> the theme here was that the economy is slowing, the fed slowed, and housing plateaued. our thought is this looks a lot like the 2013 and 2014 time frame with the taper tantrum that rose rates in the second half of 2013 and then rates came back down and housing picked up in the second half. so if you look at rates rising, the one thing that is different is that house price appreciation is much better so you have a higher level and a

lack of supply at the low end that will constrain sales at that end >> yeah, how out of whack have things gotten? we talked a lot this week about how much investors are still active in the housing market it would be crowding out first time home buyers because they're turning around to be in that market where there would be a typical first time market. maybe it is time for a 50 year mortgage that could push prices up even more and be more distorted >> that is one of the things that we're watching. we're a demand size phenomenon if you ease credit terms it increases the level of demand. they are just accelerating the price increase you have seen a flattening in credit criteria as opposed to

continued easing in that space the problem is on the supply side of the equation the boomers are ageing in place and builders build to the first time move up buyer and that opens the door for entry level buyers it is also the case that the gen x has a role in this lots of them were damaged in the financial crisis and if they're saying we have it, let's tear the roof off and add another floor, that could slow the growth of new home construction. >> let me put a pin on this, if you say that if duo any more to stimulate demand, it will be a problem because supply can't match that, supply can't increase >> that's right the question is how fast can they increase supply they have been doing so steadily and that is really today being

driven by younger households >> it is always fascinating to talk with you, doug, thank you very much. doug duncan is fannie mae's chief economist. who forget they're in public. and you should be mad at simple things that are unnecessarily complicated. but you're not mad, because you're trading with e*trade, which isn't complicated. their app makes trading quick and simple so you can strike when the time is right. don't get mad, get e*trade and start trading today.

welcome back, shares of nike have been lagging behind competitor underarmour this year nike will report their fourth quarter earnings after the bell today. cou courtney reagan is joining me now. >> china is a really big growth market for nike. it is important for production and for sales and what is going on there with the product moving through this chinese consumer that is obviously something we pay very close attention to, starting to spend more and pay attention to these american products however last quarter north american sales were disappointing. that is not a trend that anyone wants to see continue. >> is there a sense of losing

market share to any competitors. >> when we're talking about china in particular, they indicated a couple quarters of weakening sales. we are not really sure if that is what is happening here in the u.s. we had that bring strength out of adidas for some time. nike has regained some of their ground we know the teens nike is still number one for apparel and shoes. >> it seems like under armor lost a little bit recently >> yeah, look a lot of these, we talked about the strength of vans i think that eating into the sales a little bit

i think that can be a difference, but it is another player >> we will be watching i will go downpower lunch and tyler mathisen >> new at 2:00 for a thursday, china holding their ground between talks with president trump and xi we will go to the state of play at this early hour over there in japan. boeing shares getting slammed after a new flaw was found and coffee stocks are hot right now. we will tell you why and if it is worth getting in on this trade for a cup. power lunch starts right now let's give you a check on the markets at thi