cheyenne, taco johns >> other than that >> twitter >> consellation ands >> atvi. >> good stuff. thanks for watching, "the exchange" with joe kernen begins right now. >> thank you, scott. welcome to "the exchange." i'm joe kernen in for kelly evans. here is what is ahead, fear itself as in nothing to fear but. that is what one market strategist says is the biggest risk to the markets. he'll make his case. secretary of state mike pompeo says we need to regulate currencies just like we do all other financial transactions i heard it right from secretary pompeo's mouth could that be a positive for the crypto world an exclusive with the ceo of domino's pizza how he plans to get sales and the stock back on track.

but we begin with the day's markets. my friend dom chu has the numbers. >> no fear or greed happening in the stock market as you can see, it looks red, but not red by that much the dow industrials only off by 28 points. this is like the middle point of this middling range that we've seen all day today as the recovery from the low stalls out. down 0.2% in the s&p and the nasdaq off by 0.1%, as well. a key part to watch here, as well the home and housing construction stocks surging today to a new 52-week high. this etf that tracks them, up 58%. some great results out of home depot. mixed results, but a great reaction for the stock driving a lot of that home construction surge over the past year to date period. and if you are looking for the stock of the day, balance some of that optimism with pessimism.

since the highs we saw last november, this stock is now down around 41% although when we look at everything overall, it's still been a nice rise for some parts today and yesterday and it fell off again today. so, joe, pessimism, optimism, a little bit of everything for everybody in the market. back over to you >> we'll talk retail in not too long of time, dom, thank you. we heard from many market participants of what could be next we recovered all the losses from last wednesday's low and what is driving the optimism let's get to bob pisani. i've seen a lot of your reports. give me something new, dude, customize it to me now >> we have lower yields and lower stocks it's been that way the whole month, joe it's a broken record and happening again today. the cyclicals are weaker the banks, transport, retail you see tech up don't kid yourself, tech is up because

apple is up. that's how much it moves the market we are only 3% from historic highs. a remarkable amount of bullishness around the short case is very simple. european pmi out on thursday softer than expected that will prompt rate cuts and more quantitative easing. jay powell will speak at jackson hole and even though the markets are expecting two more quarter point cuts this year, a vocal minority is pushing for 50 basis point cuts and it's unlikely powell will deliver anything close to that. given the thin markets, even a small group of disgruntled investors could knock a couple percentage points off the markets. the risk is really to the down side one thing i think you're not going to hear on friday from powell is the phrase mid-cycle adjustment they're open to further rate cuts, but that phrase will be

out the window >> thanks. with such a wild ride in the markets, jim cramer says everything seems like a trap now and investors should be careful not to buy or sell stocks based on the popular recession signal, ie the inverted yield curve. the next guest agrees. he does more than just agree and he answers a lot of questions for me you spoke to me and sent me some questions yesterday. i read it. chief investment and, jim, one of the biggest things and one of the biggest fears of almost all market participants is pushing on a string. that is this time around we don't have either the number of quarter point cuts we need or the fire power that used to work your view is it still works, just give it a second. have i got that right? >> i think so. i think it's two-fold. i agree, joe, that we way overused policy in this recovery, you know with quantitative easing and massive

fiscal spending and now negative yields and i understand why people think it's spent out but what i find is that although it's diminished, the impact of policy isn't as powerful as it used to be it's still working and i sent you a couple charts if you just look, i think the primary place people worry about is the euro zone and we have negative yields and nothing is happening. but if i look at the euro zone ten-year sovereign bond yield and i push it ahead by one year leading their annual real gdp growth, there's still a remarkably close relationship with movements and yields in the euro zone and what happens to growth in the euro zone in terms of deceleration or acceleration. what we forget, i think, is there was a lot of tightening that went on from the middle of '16 to '18

and it peaked out in january of '18 at plus 80 there was a full one percentage point increase in the bund yield. it was still plus 60 last october and now, of course, it collapsed. that tightening led to the slow-down with the one-year lag. the good news is, though, now the bund yield is at minus 70 basis points down from plus 80 in early '18 not only that, but money supply growths have accelerated and what i think we will find with a one-year lag which we're coming up on here as we enter the fourth quarter we'll see better data not only in the euro zone but the lag time for the policies start to push it back up. >> jim, if it wasn't for the yield curve and purely consumer confidence or retail sales or any of the normal things that we look at, we may not have gotten any signal that there was an imminent recession here.

so, that's what got us thinking about it now, the other thing, jim, you remember last december people blame it on tariffs, but other people say that powell got too tight. why did a change in stance for powell bring us back to the highs in the markets if these things don't work any more if monetary policy doesn't work any more, why does a simple move in their perspective bring us back to highs? the tariffs didn't go away, we just got more tariffs. here we are at high. >> that's right. >> that still works. >> i think we're overblowing the fundamental negative that is trade war. and we're probably overblowing the fundamental negative that is an inverted curve in a world that hasn't used a ton of debt, particularly the consumer sector in this recovery cycle both of those, joe, to your point, does create fear. if it gets bad enough, we can freeze up the financial markets and that would cause businesses and consumers to shut down for a period so, fear is our biggest risk

and i think that it would behoove the federal reserve to take that curve inversion out by a healthy rate cut coming up but outside of that, i think it's a big bet for investors to make that maybe for the first time since maybe the great depression that all this policy stimulus hasn't entirely stopped working. i just think that is a big bet and the thing is, if it hasn't stopped and we pick up the economy just a little bit, joe it doesn't take much it will be better than feared when recession forecasts are so strong that maybe earnings estimates will have to be lifted and we'll have to lift the market from average multiples with a 1.55% ten-year yield. >> jim, thank you. we'll see you in a year. the retail etf seems to be telling a tale of two industries it is. nearly half the stocks in the red and the other half solidly positive with many up 20%.

why such a divergence. let's bring in jan ceo of worldwide enterprises and also a cnbc contributor and courtney reagan joins us, as well we can almost go down the list of individual names that some are like, wow, that's great. other are like, whoa, that's horrible a real bifurcation in the field that we talk about a lot >> the economy is pretty straight if you're off mall, off price you win. if you're off you win. if you're online only you win because your cost of capital is zero but other than that, there's freight compa great companies and some not so great companies. great numbers. walmart is a best company, costco is a best in class company and always is going to be there is also that dichotomy of the great companies versus everybody else >> what about kohl's that's off mall. >> off mall, full-price

department store the customer thinks they're a full-price store like they think macy's is a full-price store you and i know neither one is. they think ulta is off price and they're not and they think children's place is and they're not because they're over on that side of the mall the strip center as opposed to the enclosed mall. just the perception of the customer and some of it is about the age of the store, of course. how new are you to the customer. >> i thought home improvement was not in the sweet spot right now. >> it's not. >> but home depot had great numbers. >> home depot succeeded because the professional person that goes to buy that kind of stuff always goes to home depot. that is what drove their numbers this time. they had a tough time in lumber. lumber prices are down >> mortgage rates are down >> we aren't building houses at the rate we needed to because there is nobody to swing hammers. home depot turned a great number anyway

>> you have to look at every single retailer. how about tj i don't know about them, tjx reported, too. >> they actually had softer sales than we expected they were still up not everyone reported stronger, comparable sales the home goods division sells home feurnishings and decor was flat i understand execution issues there and some supply chain problems what is interesting with the tjx is two-fold. one when it comes to tariffs they're a little less directly impacted because they're buying often from someone else who already bought it first. they're at least one step removed from a higher cost of tariffs. number two, this treasure hunt has continued to be very beneficial for tjx they don't have a commerce strategy people are still going to the stores 20th quarter in a row of traffic increase >> well, i'm totally outspoken

that the tariffs are going to get absorbed in the price of money. they're going to get absorbed at the plant and they're going to get absorbed in the supply chain and at the retailer. >> but they mention it in light of the consumer being adversely affected with sentiment and not by prices itself >> i talked to carol just an hour ago and she said we have a way, the apps on our phones and we track different metrics every day. so far we have not seen a top-line impact from consumers what happened with list four which is why we decided to lower our sales guidance that is more of a response to what could happen to the consumer spending overall, not just at the home depot, in fact. less discretionary spending and you may spend less everywhere. >> you heard what jeff said, we can't mass it through, the customer won't take it yes, it is a problem but it's not showing up in my opinion so

far in consumer spending very much at all. the consumer is very healthy they're spending and it depends on what they spend it on they're still spending the money and the last six weeks quite strong in retail >> what time do we sail today anyway >> as soon as we can get you off the set. >> okay. very good. >> i want to come. >> yeah. >> i'm sorry, you're invited thank you. here's what else is coming up coming up, with the new show trailer that is grabbing attention, apple tv plus is around the corner with a big budget behind it will 2020 see an acceleration of cable cutting or with the streaming industry suffer the pain? the ceo of domino's pizza joins us exclusively why they're going at it alone when it comes to delivery and how they plan to get the stock back on track. and on the agenda at this month's g-7 crypto currencies.

this is "the exchange" on cnbc come on. this summer, add a new member to the family. hurry in and lease the glc 300 suv for just $419 a month with credit toward your first month's payment at the mercedes-benz summer event. going on now.

>> that's a clip from the morning show coming this fall to apple tv plus, source s say they dedicatd hundreds of millions of dollars from the first two seasons topping the $18 billion hbo spent during the final record-breaking season of "game of thrones." the latest sign of the off the charts amount of money flowing into the streaming and tv space as the battle for content heats up for more on how apple can compete in the streaming arena, i'm joined by james stewart columnist at "new york times" and cnbc contributor, must be expensive, jennifer anster, reese witherspoon, steve carrel. that is a lot of money to spend on one sit com, not sitcom but a docu drama almost. supposed to be "today" show, no?

>> that is a lot of star power and a lot of money and i think it really symbolizes the incredible shift from the old, you know, feature film broadcast tv model to the new streaming model where the top writers, the top directors, the top talent, they're all moving into the streaming space and original programmer direct to consumer. that is a big change >> jim, the first thing i thought when i heard $6 billion. if you made 5, $200 million, that is 30 -- that is a lot of money. is it really $6 billion? >> i assume so by the way, we're kind of tossing around these billions. where is netflix $8 billion or $9 billion to be a player here, you have to be in the billion dollar space i mean, this is a nuclear arms race in spending out there

i mean, everybody i know in hollywood is just thrilled it's like golden edge. if you're a director, writer, star, frankly, even a journalist, me, the bottom of the food chain, the money is suddenly showing up out there like it hasn't in a long time. but, let's face it, these costs are driving up only so much talent and only so much intellectual property available. the bidding is going up. the prices are getting higher. this has got to come out of somewhere and i think it's going to be the margins for these companies. >> i'm ecstatic about the possibilities for great content. "game of thrones" or "breaking bad. i remember the three networks and a couple i don't remember, and we were mired in last place. we'd throw up stuff against the wall and nothing stuck, james. someone is going to find out how hard it is to do this. and i'm just wondering who it is

going to be at this point. someone is not going to be good at this, aren't they >> that's a really interesting question because, i mean, frankly, i've been amazed that netflix and amazon basically moved into this entertainment space and they did it from scratch. they didn't go out and buy a big studio they put together a team and, you know, they've been remarkably successful at coming up both with things that people want to watch that is critically acclaimed and a wide variety and they have the budgets, frankly, that they can throw a lot of stuff up there and the stuff that doesn't stick, they just get rid of it. they move on remember, the old network model there was only room for a finite number of shows on that network. you had to pick the shows very, very carefully if there was a high failure rate, that was extremely costly. with these giant budgets and the unlimited space available in streaming, you can just throw up any number of shows and see what happens. you can take a shot at something

that seems very and who knows, might catch on and be the next "game of thrones." >> what about something no brainer like sports or business tv >> i think sports is a special category which is dominated by espn and i would put news -- >> i was being generous to the industry trying to make people actually think -- we are. we are essential >> i always felt that business had a very, would do very well in a deed bundled cable world because it has a very affluent audience >> you love it i know you're out there. you mentioned things don't act like you're not glued to that. >> i watch it. more the point, my father before he died, he was glued to it. >> excellent. >> he would have paid a lot of money just to get cnbc. >> i wasn't fishing, but thank

you. thank you, i appreciate that we'll see you, i say this, i'll see you in another time, another space at some point not too long a time, i'm sure. still ahead, what are we going to talk about? shares of domino's sinking 18% over the last three months rich allison will join us to discuss the latest innovations and effort to stabilize sales. shares of u.s. steel lower today and the company plans to layoff temporarily 200 workers in michigan that is micong up in "rapid fire." stay with us

welcome back to "the exchange." here's some of the movers this hour shares of teva the availability of an fda approved generic version of the epi pen jr. the stocks had a rough ride this year, though down 53% mccormack also in the red today. jpmorgan downgrading to underperform from neutral and the potential for a disappointment in the future acquisitions and shares of sarepta shrinking after the fda failed to approve its new treatment for the form of musculardystrophy pointing to safety concerns. they were predicting sales for the treatment of the nearly $400 now, they said will you do "the

exchange"? and i said, why? because you can toss to sue herera >> good to see you >> everybody is getting older except us. what is our secret sph. >> i don't know. >> just joy. joy being around here, right >> that's right. absolutely joe, great to see you. >> good to see you, sue. >> here is what else is happening. new recommendations are out on which women should undergo testing for the breast cancer gene the u.s. preventative services task force says all women with a history of breast or ovarian cancer should be assessed for the increased risk the judge will rule to throw out the suit in october. the hearing was the first since the civil case was moved to federal court from state court speaking today from a conference in aspen to cnbc's brian sullivan, the country's

top anti-trust official says the justice department will work together with state attorney's general to investigate the big tech companies >> i anticipate it would be in a cooperative manner that, i think, benefits everybody involved states and their enforcement objectives, as well as the parties making sure that we are engaged in an investigation without creating undo burdens. >> you are up to date, that is the news update this hour. joe, i'll send it back to you. >> this is "the exchange." what was our show, sue "the edge. >> let's bring back "the edge. >> we were here for 12-hour days back then. that was something anyway, thanks, sue. >> you got it, joe >> the countdown is on to the jackson hole fed summit. cnbc is going to have first on interviews with the fed heads from philly, dallas, st. louis and cleveland as well as the ims

chief economist all kicks off this thursday and you don't want to miss it and here's what's ahead on "the exchange. ahead, jpmorgan bets big on beyond meat after a very rough month. the supposed tesla killers in the electric world are doing so well. and air bnb for the extra atuff in your life th's ahead in "rapid fire. phara you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life. - stand up if you are first stand up if you're a mother. if you are actively deployed, a veteran, or you're in a military family, please stand. i will tell you this, southern new hampshire university can change the whole trajectory of your life.

let's catch you up let's catch you up i guess that's okay. a few stories on your radar. time for rapid fire. it's a big job for you guys here with our take on a couple stories. seema mody and dom chu shares of beyond meat after jpmorgan upgraded from overweight to neutral acquire new customers, continued strength in measured data and its attractive valuation the stock is down about 31% since hitting an all-time high back on july 26th. still up more than 500% since its ipo.

i told you about my pet peeve about this the analyst making the upgrade raised the price target from 188 to 189 i mean, come on. are you that good? you did some numbers and no longer 188 you can't get six-minute abs you need seven minutes to get a burn >> and at least ten push-ups so, in defense of the analyst community -- >> why do you need to defend -- >> i know that you were v opposed -- >> if they were allowed to actually put their money where their mouth. i would say this, the input for the model changed a bit but probably raise the price target out there. >> correct that's how it works. but still. jpi jp morgan was the first one to come out and say totally adjustable market and that's why

they came out with this extremely high valuation off the bat and pulled back quite a bit. this is a trading vehicle, no doubt. >> this is a summer story because we're eating burgers and at barbecues and the minute snow is falling are you talking about beyond meat? >> do you eat it >> it's not for me >> as far as market share for burgers, they got a big amount of market share to take because i have not moved that way. >> you tried it, though. >> i tried it, but i'm not ready to buy it and eat it >> i had an impossible whopper my dad is a burger king franchisee i would order one. >> you would order one >> yes i was into it. and it's worth noting the fact that you do see these products being sold in the super, mmarket next to the meat and the secondary offering news. >> but you don't need to make huge end roads to get the value. >> you know what's good if you make like a marinara and you

chop it up like taco meat. >> i did try the sausage and it was good. tesla is still untouchable when it comes to electric vehicles audi and jaguar launched some to take over. let's take a look at 2019 sales through july the model x far outpacing the audi and ron barren was on "squawk box" this morning and said the legacy car companies have built factories for years that make engines. they make internal combustion engines. suddenly they're supposed to move into battery and they say, oh, yeah, we're going to do it we're jaguar, we're audi, but they can be ten years behind >> they kind of are. tesla had the first mover investor so much activity and noise surrounding the tesla story and

elon musk but one cannot dismiss the dominance in the market. the big question is whether it can create the same level of success and the other parts of the business that it has been trying to grow into. whether it's batteries, storage or solar panels. >> mercedes has now come to the, mat first with the minivan electric minivan out there now when i was watching "avengers end game" audi electric vehicles were prominently placed in those things the established car companies have a bit more to kind of go into this because they actually have brand names established, you know, vehicles, that they can then sell via a mass marketing tool like movies >> i think branding is everything also the offer it plays in branding which is what tesla has. whoever cracks into china and really drive market share in china. >> they don't need me because i'm still driving a five guys.

u.s. steel says it's laying off hundreds of employees at one of its plants in michigan halting production due to lower steel prices and softening demand the layoffs are temporary but could last for more than six months shares of u.s. steel are down more than 70% since president trump announced the crackdown on foreign steel imports. i think this needs some perspective. easy to say, wow, you were just touting the steel industry, what is going on? adding some plants, this is temporary. it has a lot to do with a global slow down in the economy and hot ro prices falling than tariffs. you can say the tariffs didn't help rejuvenate. >> some say the global growth slow down is indirectly tied to tariffs. it goes both ways. >> chicken or egg. in this case here, cars and farm equipment, right >> maybe sentiment >> we were just talking about retail you haven't seen it in the price increase in retailers.

probably global sentiment but when the fed reversed in december, the stock market went back to new highs in the midst of the trade war >> sort of ironic, though, it was u.s. steel that tried to push president trump in the u.s. administration to unveil section 232 tariffs. >> the counterfactual, would it be 1,000 layoffs permanent instead of 200 temporary >> at the end of the day, steel is still a story the u.s. labeled china a manipulator and a lot of folks came out and said, oh, this doesn't even make sense. the steel industry came out and said this is welcome news. steel, like it or not, even though the u.s. prices have been more buoyed it is still a global, economic story as you point to finally, this is bizarre you probably heard of air bnb the company that lets you rent out space in your home for lodging. another company is taking that concept a step further and you'll be able to store your

crap somewhere like in someone's house. they have some extra storage space. >> is it secure? >> for more, let's just, i don't know not in my house. i don't want people's crap i have enough of my own. let's bring in diana olick is this a money maker? something to watch >> absolutely. yes. look, if you have extra space and you're extraordinarily hot attic like you do here you can put it online and have somebody come and rent your little space and they're going to rent it for a lot less than they would at a storage facility and it may be easier because they can come and go as they want and it's safer because it's in someone's house. the company is called neighbor and barely two years old and started by some very young guys who thought this up in their college dorm room and it's now expanding. 48 state going international $2.5 million in seed funding for it and people are actually using it the cohen family of atlanta rented this space to a college student nearby in atlanta and

she brought her stuff here and they're charging her and also going to rent out their next door parking space to an rv and it's very simple and they can charge what they want. six public storage reits to date and earnings up 21%. which is really good but the question is something like this going to take a bite out of something like this the same way air bnb and uber took a bite out of their industries >> first, security how do you make sure your stuff is safe? and access how do you get your stuff when you need it? >> you're in somebody's house. a lovely family with two kids. you have to believe it will be relatively safe. basically what they told me at neighbor is one in five storage units at a public storageplace are broken in to that is a pretty high lack of security a nice, suburbanneighborhood, at why not?

>> can you imagine if someone broke into your house trying to steal somebody else's stuff. >> there is insurance. the renter has insurance and the homeowner has insurance. and if any of the stuff they store, which they can reject, by the way. which they are allowed to inspect to make sure there is nothing unseenly in the stuff. they have insurance, also. >> what if you're fearful for the safety of the home. >> it covers the house up to $2 million on the house. >> absoluty. >> do i want to rent space to a person or the stuff? what would you do? i don't want to do either. >> i would say everybody has a price. so, if the economics of this thing work out pretty well, then maybe i would -- >> we're not arguing what we are, just how much we cost all right, thank you thank all of you thank all of you, diana, seema, dom and morgan all one namers we don't need more than that.

just last week domino's announced it is launching an e-bike delivery program later this year. kate rogers is in ann arbor, michigan at the innovation garage which, unfortunately, is not new food it's technology. what are they working on, kate >> hi, joe that's right their new innovation garage. t 'll chat with ritch allison abouall things innovation including this driver robot that they're testing for delivery stay tuned . ...change of plans! (vo) defy the laws of human nature... ...at the summer of audi sales event get exceptional offers now!

shares of domino's falling more than 16% over the past six months with the likes of uber eats and grub hub giving customers more delivery options and pressuring domino's u.s. sales but companies working on new delivery technologies to take on the third-party options. kate rogers is in ann arbor, michigan with ritch allison for

a cnbc exclusive interview hey, kate. >> joe, thank you so much. ritch, thank you so much for having us here >> pleasure to have you. >> let's talk about technology increasingly competitive in the restaurant space how is domino's thinking of tech investments and innovations for the future >> absolutely. you're sitting right here in our new innovation garage. we put this in place to accelerate innovation in all things delivery. we're able to stand up or break down a store in a matter of hours. we can look at how we innerface with this neuro robot that is right behind you and how team members utilize the technology in the stores to make sure we're as efficient and cost effective as we can be >> the driverless robotic delivery, you're testing that r this year. talk to us about when consumers can expect to see one of these robots delivering their pizza and what customers can look forward to from domino's

>> the neuro robot we'll test in houston and expand to one store and a store after that it will be a while before you broadly see that across our system but we'll be testing and learning with the key being, how does the consumer want to inner face with the robot at the curb. we'll learn a lot. i think what you'll continue to see from us is just lots of innovation around how we get food to our customers as efficiently and effectively as possible behind me are some of our e-bikes we have been rolling out. great way to go out and recruit team members that don't have cars but want to be involved in delivering pizza and part of this growth story that is domino's >> part of your expansion plan is getting those stores closer to one another and shorten delivery times and adamant working with the third-party delivery platforms is not the

domino's way the store has seen pressure because of that. tell us why you've chosen to go this route and why you think it's best for domino's long term >> the first reason is we're not going to outsource the customer experience to someone else if we want our customers interfacing with us through any one of a number of 20 odd ways that they can order pizza from us but when that delivery happens the only human interaction is with that delivery expert and we want that to be a domino's trained delivery expert so we own that process from start to finish we also believe that that is the most cost effective way for our franchisees to deliver to their customers. and every decision we make is mindful about the profitability of our franchisees we feel very strongly that ownership of the customer experience and advantaged economics are going to be the recipe for us to win in the future >> we've also seen a lot of swings in the stock market a lot of talk about a potential recession down the line. what is your read on the

consumer from where you sit right now and are you concerned about that snp. >> the consumer is really strong here in the u.s. and the most important thing when it comes to driving demand for pizza is having employed customers who have disposable income to be able to afford to feed their families we see a very strong consumer today. >> fantastic, ritch allison, thank you for having us here joe, back to you. >> did you come in that little thing? >> i drove here from new jersey in this thing. >> did you really? >> no, there's no seats. that's the point >> oh, i got it. all right. thank you. >> you put in a code and it opens up >> i knew that all right. thank you. kate rogers. and mr. allison, by the way, featured speaker at cnbc's evolve summit in chicago next month. the event features ceo leading legacy companies in rapidly changing industries like you just heard about visit cnbcevents.com/evolve to

learn more and to register will the apple card get it back on track? >>thpes at> e rkwh goldman sachs ceo had to say about it. that's next.

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welcome back to "the exchange." apple moving higher today and has now recovered nearly all of it august losses the stock getting a bump after launching its apple card to all u.s. customers the company announcing it's extending its 3% daily cash back policy to merchants and apps including uber and uber eats goldman sachs says its move into the credit card business is a milestone, with ceo david solomon saying it's just the beginning for them >> the g-7 meeting kicking off next week. actually, i think the 24th with the price of bitcoin nearly tripling in 2019, and facebook recently announcing a digital currency, cryptoes are on the docket is that good or is a cckwnrado coming the exchange is back in just two minutes.

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this morning on "squawk box," we talked to mike pompeo. one subject i pressed him on is bitcoin. here's what he said. >> we should use the same framework that we use to

regulate all other electronic financial transactions today that's essentially what these are. these are moneys moving through markets or in some case disintermediated transactions. the same set of requirements that apply to things flowing threw swift or our financial institutions ought to apply to those transactions as well it will be difficult to do, but the theory, the regulatory theory we ought to apply is that one. >> the past couple weeks, bitcoin is down close to 9%, but it went down from like 12,000 plus to about 9,000 or so and then that news came out last friday we'll talk about that in a second it's up a whopping 181% this year let's talk more crypto, and mostly bitcoin with anthony, cofounder and partner at morgan creek digital assets pompeo this morning, we were talking about this and once again, everybody usually talks libra when they talk regulation, and he said

well, it's got to be regulated like anything else bitcoin's been around, it's a $200 billion market cap already. it hasn't happened yet it's already out there and not regulated. i mean, it could be, but i think they're mostly talng aut libra, aren't they >> if you want to regulate the on and off ramps, the fiat world into the bitcoin world, that's where i think regulators will most likely go first when it comes to libra, it's easy they can look at the corporations they want to be good stewards of the jurisdictions in which they operate. if you want to, you know, manage facebook or other corporations, that's fine. but again, bitcoin and libra are very different >> very different. >> an important difference >> the eu is going to look at the anti-trust concerns, but once again, libra. the g-7 is coming up, there's a working group from japan, one from france. both seem more focused on libra, or am i wrong about that, or is there a risk to bitcoin, an

overhang to bitcoin based on what thaller say in the g-7. >> many in the market, whatever they say about libra and bitcoin, they'll lump it together, but the difference is important. one way to look at this is in less than a decade, there's a decentralized currency that went from the fringes of the internet that is now being discussed at the g-7. ten years. >> i asked pompeo, mnuchin, trump has tweeted about it >> its really important when it comes to libra, talk about anti-competitive behavior, 27-plus corporations today, they want to get to 100 it's going to be hard to label anti-competitive behavior when you have 100 institutions working to do something. it's interesting how it plays out, but a decentralized currency like bitcoin is going to be treated much differently >> let's talk about mass adoption that's the next step people are looking for. there's glimmers of things happening. friday, getting approval from regulators for futures on

bitcoin that aren't settled through cash they're settled through bitcoin delivery people say this will get the eye of institutions and bring more mass adoption. do you believe that? >> i definitely do every single week, we're seeing more and more infrastructure built around bitcoin and the crypto markets in general, whether it's infrastructure around the hash rate and the mining, support and security of the network, whether it's backed with the physically settled futures. the more infrastructure built around this, the more likely it is to never go away. we're at a tipping point with bitcoin is here to stay, and it's going to be in every portfolio in the future. >> the stock to flow models we have talked about, if you believed just in that it's 95% correlated so far and you look at where gold stock, the flow is 62, and the next having in may of next year would put bitcoin near there that's a staggering figure to say that it indicates a much higher price what could get in the way of that happening would it be regulators

otherwise, you have -- if it's so well known that that's where the price should be at the next halving, why isn't it close to that price we're talking about something like 55,000. is it real, something to really take seriously >> there's three components. one is regulation could hurt in the short term it scares people away. that's one thing to watch. two is there's still a lot of people who don't know what bitcoin is they don't understand why it's valuable the number of people who own bitcoin is a small percentage of the world population, and the third piece is it's still difficult. even if people say i want to buy bitcoin, they have to get a gemini account and get work to do there it's not like calling up your broker and buying a stock. that friction is still keeping people out of the market friction will go down, people will become aware of de, and more people will get exposure to this asset that will be a net benefit to bitcoin over a long period of time >> it trades a lot, that's for sure, and it's volatile. you know, i hear people saying it's -- what do they say, an exponential technology that's based upon exponential

technologies do you believe that? >> it has the potential to be market expanding technology, similar to uber in the early days >> you'll be back on somewhere, maybe squawk soon. great. thanks for coming in >> you got it. >> that does it for "the exchange." thanks for watching. melissa and tyler pick it up from here with "power lunch. >> great to see you. thank you very much. i'm tyler mathisen here's what's new at 2:00 on "power lunch." recession fears looming large over wall street, but from fed cuts to tax cuts, what can rescue this rally? and big tech under fire. reports that state attorneys general will join forces at the same time the department of justice is set to take on the group for anti-trust violations. big tech >> plus, home depot domination the stock having its best day of the year after a blowout earnings report, but one top analyst says there's a better buy in the space how can