final trade? >> bristol-myers. >> blackstone. >> xny. >> cisco of it's down, going to go higher >> you made it happen. thank you very much. by the way, i'll see you back here tomorrow, i hope. that does it for the halftime report "the exchange" with chkelly begs right now. >> thank you, brian. hi, everybody. a major turning point. the battle between the nba and china be the event that make companies say enough and what happens if u.s. businesses stop backing down to china? we'll discuss. and battle on both sides of the atlantic for boeing. european regulators say they're ready to sign off on the 737 max. at home, the pilots are saying pay up we've got both sides of the news coverage for you it's good to be number one except when you're number one on the brands no longer worn list before all that, we begin with today's markets. we have a state of play. >> yeah.

just two days until the trade talks kick off in d.c. the uncertainty on whether a trade deal will be made is rising that is weighing on stocks we recovered a bit for the dow down 181 point we were down 338 points at the lows 1% decline for the nasdaq. number of those semiconductor stocks are trading lower industrials and companies affected by the outcome of the trade talks are notably lower. united rentals, ubs downgrading the stock today citing weak demand the stock is down by 4%. honeywell and 3 bsm lower as we. take a look at alibaba, baidu, losses 1% to 3%. alibaba now down about 7% in the last one month >> thank you very much

welcome to "the exchange," everyone let's get to the topic dominating the markets china. the country's delegation is in washington trying to hammer out a trade deal, a different narrative is taking hold outside the beltwaand cost of doing business in china. the nba scrambling to diffuse a backlash at home before it apologize forded for a pro hong kong tweet will the outrage turn the tide away from companies backing down for more, i'm joined about it free main chair and china studies at the center for strategic and international studies. and jefr moon, former assistant trade rep to china great to have you here jeff, i'll start with you. is this a turning point given the backlash that we've seen by the public here to what the nba has done this week >> i think this may be a turning point in our trade discussions with china for the first time politics raer rather than economics are front

and center in the trade discussion it's in the nba discussion and sanctions chinese companies doing business and previously and in previous administrations, we separated mill issues out frpolitical isss it gets much more difficult to get to a red lugs. this is something different and going to complicate the trade discussions. >> jude, i certainly don't blame any businesses, the nba, you know, the litany of u.s. companies with big presence in china. it hooked very hopeful there even just five, ten, 15 years ago. but it's taken an authoritarian turn under president xi. so what should businesses do now when confronted with existing spending and programs and now, of course, with the hong kong protests which are really what ignited all of this, ai very difficult position to try to take or not take >> yeah. i mean this is something companies have been dealing with for decades when operating in china. you try to find a way to operate in the country where these

extraordinary political sensitivities. and when you inevitably trip over them, you very quietly try to walk it back. but obviously this is a new paradigm we're talking about a company which is at the very center of american culture and so is having the growing pains very publicly, i think as jeff was just saying, i do think this is a paradigm shift here. it's going to be very difficult for major u.s. brands now which are operating in this context of deteriorating u.s.-china relations to be handling these things quietly with the role of social media and public scrutiny here i think what this means is the political risk model of how you handle the price is is going to have to undergo a fundamental change and one that is aware of all the multiplying trip wires here which are increasing at a rate that even those of us who operate in china for a long time can't keep track of. >> right again, it's one thing for people to understand that china, is you know, has the issues like many

countries, obviously, where people do business there is similar problems. but with the hong kong protests, now you have a clear cut issue, a pro-democracy one. these were freedoms we were promised and not given it's hard notto support them, frankly. they're appealing to the u.s when you look at the companies that backed down for intentionally or unintentionally slighting china which grows by the day. we havstocks in many cases they're not even meaning to offend the china and the moment that they're told, look, we don't like this, they back down. do you think those companies will stop doing that or is that never going to be the ka icase >> no. i think as you think about it, even from the nba's perspective, the price you pay in the united states for backing down to china is simply a week of twitter and the price you pay in china is the fund al loss of market access so i think the calculation and in many ways won't shift

they'll get smarter about that but until that changes, you want to quietly apologize and do your best to mend the rift. >> jeff, where does -- so not only by the way are there plenty of people here at home who would take issue with that and say wait a minute, we shouldn't put up with this any longer. take a stronger stand. or maybe google's approach looks wise when they left altogether that all being said, and as the business world contemplates what to do going forward, what does it mean for the these high level trade talks between the u.s. and china which are coming from annedan an administration that is hands off in trying to spread freedoms throughout the world >> it does complicate things there is a window of opportunity really between now and i would say when the iowa caucuses start on february 3rd and reach an agreement. the chinese are signalling that they're not prepared to address the core industrial issues which means any deal with need to be some kind of a small deal. president trump says that he

doesn't want that deal they're making purchases, the u.s. could grant some nonnational security licenses to other companies. there is progress. >> and looking further, all right, appreciate it >> jeff moon joining me on that today. we want you to weigh in from the nba to tiffany and gap u.s. companies bowed down to political pressure from china in exchange for doing business there. is that right move yes, can you say the cost of doing business there or, no they shouldn't compromise the values. head over to the exchange on twitter to vote. stocks are sliding as optimism sours about the trade talks which are set for thursday the president saying yesterday a big trade deal with china is now unlikely as the delegation from day jing looks beijing looks to limit negotiations let's bring in michael

schumacher from wells fargo and marian fontaine. the so, michael, especially the way that bond yields have acted lately, we're still down in the 1.5% range in the u.s. a lot of jitters out there >> it is getting close you hit the nail on the head for jitters. whether it is china or iran or turkey, impeachment, brexit, you name it. this is a laundry list of stuff, frankly that, for investors is very difficult to assess and listening to the prior guests, prb probbly not a big deal yet it doesn't bode well volatility seems like it's here. >> what happens if the big trade deal never comes people are saying in this even is a tweet coming from the chinese side from the global times saying it's going to be these on going trade talks but no real trade deal and what if that's the status quo for years to come?

>> well, i guess we just probably continue as we are today. i mean, we're pricing in no trade deal, you know, when they said that they're going to go from possibilities and these next trade talks to quick exit the market today is pricing in in no no trade deal and not any time soon we continue operating in the same way that we're doing today. >> do you change any of your specific investments knowing that deal may be less likely now? >> no. i think we've got, you know, our focus on going into the fourth quarter some retailers that, you know, would get help if there was trade agreement. but we're not factoring that into our earnings estimates at this point and we're really focused on the u.s. consumer particularly the low end of the, you know, income period it's a very large low end of the income period pyramid that is

getting the majority of the wage gains and they have higher propensity to consume. so will is going to be greater purchases at that low end. that's why we like dollar general and five below here. >> we're going to hear from jay powell in an hour and a half what is your expectation for more rate cuts and does the -- if we're less likely to get big trade deal zshgs that mean we're more likely to get lower interest rates >> yeah, we've got one more rate cut this year, kelly, and also one next year. but for the fed, it's really new territory. and you go back to powell's comments at jackson hole he said there is really no precedent for the current situation. think about that comment this is the chairman of the federal reserve, no precedent. >> is he referring directly to the trade issues >> he was, that's right. so i suspect the situation in his eyes probably got a bit worse, a bit more challenging. so we look at that and say, gee, it's awfully tough for investors. it's tough for traders and also tough for policymakers >> let me ask you something. does it make sense if this is a longer term conflict between

u.s. and china where they're to stay in place for some time, does it make sense for them to be cutting rates in response to that when it slowed the economy a little bit the consumer is still very strong housing has been a little on the uptick lately. is this the right policy response to what may be a long term breakup here? >> it's a great question the fed has been talking about taking out insurance cuts so the fed consistently is saying whether it is powell or the other leaders the base case for the economy is good. and it's worried about the cross currents so trade is probably cross current number one it is in our eyes anyway so the fed in our belief gets probably a little bit more motivated to cut, frankly. but is that enough to push it towards two cuts this year frankly, we doubt it >> right granted there were some soft inflation data this morning. do you think rate cuts make sense here >> you know, i think we have two choices. we could just get this october 1 and be done or we could fall into, you know, a widening

decline in growth overseas and be in for a number of rate cuts next year. i don't think question tell at this point and i'm going to favor the one and done rate in here. >> all right thank you both appreciate it today. michael shoemaker and marianne fontaine boeing's woes also continue here and abroad. there is friction between surprise pe european and u.s. regulators weech we'll bring you details. and boeing facing the wrath of the southwest pilots suing them. we'll speak about that next. the stock is among the top losers in the dow. it's make a little bit of a comeback still down .3% j.p. morgan and cisco are down 2% the exchange is back after this.

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welcome back boeing's woes continue today "the wall street journal" reporting there is friction between u.s. and european regulators that could delay the 737 max's return to service. it appears european regulators are pushing for more tests joining me now is andrew tangle, co-author of the piece in "the journal" today what can you tell us what is the hang-up here >> the european regulators want

more and more testing of part of the fix that boeing is working on the faa it's not directly related to the flight control system that's been implicated in the two 737 max crashes. but it has to do with how the max's two flight control computers work together in tandem to add redundancy if there is a malfunction and as we reported, they would like some additional risks scenarios to be tested and it's causing frustration because it's no the clear what exactly are the measures that would allay their concerns >> right or how long would this take.

most importantly, andrew, how big of a delay are we talking? >> that remains to be seen boeing and the faa have said, you know, there is no clear time line and boeing has said it's really in the hands of regulators now we know that the faa and boeing have informally sort of been targeting early november, early fourth quarter which we're now in for the ungrounding order to the issue but the faa is concerned about geopolitics and working with other regulators and the max in unison. so passengers and airlines can have confidence in the would, that boeing and faa have been working on to fix the system the faa and the like the

european regulators to come along about them and it remains to be seen when the faa's european counterparts are going to agree the viewpoint and the technical aspects and training and other matters that come along with it it could be a matter of weeks or months, but really it has yet to be seen if if they're going to change the position and come onboard with the faa. >> yeah, no the to mention like you said it could set an industry wide precedent for foreign authorities second guessing determinations by the faa. so much more ramifications to come andrew tangle from the without journal with the late oevent that skirmish. grounding of the boeing 737 max has turned into a legal issue here with the southwest airlines pilots association suing boeing over misrepresentations and lost wages. for more on the move, i'm joined

by john weeks. what specifically do you fault boeing with here >> hi, good afternoon. and we were in talks with boeing and because of the magnitude of the losses keep piling up. aand as we know now, that's probably even further delayed. and i understand that is the core issue that hangs over the entire delay >> kelly, we relied on boeing to produce product tests all the way back from when we were negotiating.

and there's been surprises along the way, we were never informed and what existed much less, you can't train what is not in the book and when we send our representatives into boeing for the training, there was no mention of that. so as we know it, it doesn't exist. it's being designed out of the airplane now the fact is boeing was responsible for producing an airworthy airplane that we could make income off of and that hasn't happened and i'll be glad to shed light, too, on the time line as we go further in the interview. >> that is interesting people should be aware if they're not already that south west uses i believe almost exclusively boeing 737 aircraft. so this plane is extremely important to the ambitious including adding that hawaii route in particular. can you tell us what the impact has been on individual pilots from this grounding in terms of hours lost, wages lost >> you bet

the figures are $115 million starting on may 1st through the end of this year, december 31st, 2019 and when the max was grounded, the max was about 4% of the southwest fleet. 34 aircraft. by the end of the year, that was scheduled to be 58 aircraft or roughly 8% of the fleet. you mentioned hawaii we have been delayed from our san diego-los angeles service because we haven't been able to have the max in airworthy condition, have it be flying so the inventory that the max was scheduled to fly between may and december, that's how we got to that number and that inventory is just been removed from our ability to make income. >> right when we had the ceo of boeing on, we did ask him if he thought that plane would be back in the air by the end of this year. he said yes with the caveat about safety and so forth. it's obvious that's unrealistic now. what happens if this drags out beyond, say, the first quarter

of next year and we start getting into march and april what then? >> well, i think you'll have outliars in in factors coming to everybody. the airlines, passengers, obviously our pilots. we treat it as a passenger -- we give a lot more reference to the term passenger what they need to know is they have our word on this and we have their back. so when we say it's ready to go, it will be ready to go and we will be on the forefront of actually the flight simulator testing. you know, that is what has to happen first to get what andrew is speaking of earlier in this segment. and so we were told that the simulator testing would probably start end of october we've gotten no word on that

>> i had sounds like the sluping ti slipping time line is the root of this grievance. >> we know it's an exciting time for you and your family. all the best. >> thank you, sir. i won't be getting on the plane for the next few weeks i appreciate it very much. >> you're welcome. take care. >> thank you you too. >> john weeks is president of the southwest airlines pilots association. and for all the headaches and drama that plagued boeing over the 737 max, investors are not concerned. the stock is up 15% year to date that is on power with the major averages and up 44% in the past two years. >> coming up, the teens have spoken piper jaffray's latest teen survey is out. it's not good news for several retailers. we'll tell you where gen z is no longer spending. plus, the surprising weapon being deployed to save america's shorelines billions of dollars worth of coastal real estate. "the exchange" back in two

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ncht welcome back. the dow is down 330. we're down 140 now that is a .5% drop the dow is outperforming the nasdaq down .9% or 72 points take a look at the sectors all 11 in the red today.

a pretty widespread selloff. health care, financials, materials, some of the worst performers there health care down 1.4%. of take a look at the semiconductor etfs which are having a rough day as well there were since late august the worst performers today and now to sue herrera for a news update. >> hello, kelly. here's what's happening at this hour senator lindsey graham has invited president trump's personal lawyer rudy giuliani to testify before his committee about ukraine. giuliani responded he would consider that request. >> swiss astronomer says that he was meeting with other academics interested in finding new planets when a press officer interrupted to tell him he had won the nobel prize in psychics. >> i was not expecting at all this is more than the others i want in the mood for

this i was in the mood of a meeting and then i get the call from the university of cambridge. i recognize the number >> he is probably in a better mood now >> and the monya lisa is back in the original room at the louvre museum after two months of renovations put the masterpiece in a temporary location. they're preparing to celebrate the 500th anniversary of da vinci's death. the must see that is the news update this hour back to you. >> you have seen it? have you been? >> i have. it is stunning >> it is worth fighting the crowds >> you know, you have to go off hours. if you go off hours, it's always crowded. but it's a little less crowded if you go off hours. and recently they were like handing out tickets like it's a timed visit. >> like seeing the crowned jewels >> basically, yes. it's not as big as everybody thinks it is when you get there. >> but now that i know, i've heard that it's small. now i think if i ever saw it, it would seem bigger than i

expected the. >> maybe so. you have to go at some point it's beautiful. >> we'll try appreciate it. sue herrera it's good to be at the top of the list except when it's the list of brands no longer worn. we'll tell you which retailer has taken that home. and dominos stocks seeing a big turn around on the ceo's positive commentary. about a 12% point swing. and counting we'll break down what he said and if the market is right to pivot so quickly coming up servicenow put our workflows in the cloud. this changes everything. you're right sir... everything. no not everything, i mean you're still blatantly sucking up to me gary. brilliantly observed, sir. always three steps ahead. six steps ahead. sixteen. so many steps. you done? a million steps ahead. servicenow. works for you. woi felt completely helpless.hed online.

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welcome back let's get you up on a few stories that should be on your radar. time for rapid fire. here to break down the headlines are my guests. welcome, everyone. and first up is the piper jaffray teen survey. we can figure out what gen z wants. no one cares about the millennials anymore. i love it. >> or the boomers. >> or the boomers. >> but the boomers -- anyway >> you haven't cared about us for a long time. >> you're hugely important >> actually, i love this survey. i look forward to it every year. it's really interesting stuff. >> a couple things to pull out for you. shoes and apparel. check out under armor. they cracked the top ten in footwear among teens but here's the bad news.

when asked what brands they no longer wear, under armor came in number one by the highest proportion yet not a great sign for the company. i believe 21% of teens say they're no longer wearing it as of this fall survey. now another brand cracking the top ten in footwear is crocs which jumped up to number seven. i asked the group why. here's what they tell me gak in popularity because of celebrity collaborations like this one a set of crocs designed by a wrapper postma lone. the share price performance tells you the story here crocs up is 50% over the past year way outdistancing the likes of under armor and nike >> footwear spending, despite broader teen spending on the decline because they're xer concerned about the economy. footwear spendings on average, $300 a year for teens. fwz $60 higher for males over women. i think as you point out, a lot of the brands are able to reinvent what they're trying

to -- how they're trying to resonate with a younger audience whether it's crocs or beshgen stock which is coming back >> i tried some birkenstocks, i still don't like them. $300 on footwear, also from the piper teen survey, spending on handbags and beauty products and that has plummeted the so according to the survey, teens are spending $90 a year an on average on handbags. the and cosmetic spending, it is a 19-year low. we know what happened to ulta stock there lately huge around around there capri which owns the brands. but really interesting change in the -- especially shelling out the guys are for the footwear. >> that is especially interesting. this generation cares so much about instagram and the generation of selfies, all of the influencers, so many of them tied to beauty in particular

kylie jenner i couldn't really quite, you know, understand why the beauty spending was down. i think it is interesting that sephora has fallen off ulta is still number one but they're notes have as good a experience at sophor i spend a lot of money there it is a little less organized. the you can kind of understand why. the. >> fort knight is starting to fade as a favored video game free collaborative games like fortnight is but video game as a category is still very solid so they moved on to something else they didn't say what it was. but i found that interesting >> yeah. any other gleanings here >> casual fashions are growing we've seen that even in our own -- >> you mean like sweat pants you mean like dressing casual at work snr. >> yes >> jeans as well and nike ranking high among

teens. this is still a brand they favor. you look at the stock price, it's done incredibly well, up 25% this year compared to under armor which is up 5% then louisiauli lemon. >> and chickfil-a. food spending, number one category for the teens and fichick fil-a is always numr one. and olive garden made a reappearance that is interesting. they're kind of to blame the teens for the death of casual dining when i was in high school, chili's on a friday night. but olive garden did make a move into the circuit. >> bob's big boy. >> what is that? >> anyone? >> bill? tell us more sounds great >> never mind. >> sticking with the food theme -- >> all the people in california are nodding their head right now. yes. >> also loving it right now is domino's check out the stock today. a huge turn around

it was down more than 6% this morning after lowering the long term sales outlook but then the ceo came to the rescue on a conference call saying there is a significant shakeout coming to the industry that will allow dominos to grab market share from rivals he is talking about door dash. he thinks that business is unsustainable. stock is up 5%. >> that turned around on the conference call. rich very authoritative on the call he said this is a pro active decision to chaufrnge the guidae two to three years makes more sense for investors. they think it's a better measure than a 3 year to 5-year outlook. his message, my take away from it is we're not sure who is going to be here in three to five years in terms of all the aggregators. we're playing the long game at dominos. we're on the offensive, not the defensive here and we will be here. >> they lowered the domestic outlook. it's one of the brands that is in 85 countries. the they have over 10,000 stores

outside the u.s. do you have a sense given that you cover this company, kate, that dominos grew too fast internationally? >> so, it's no the just international. u.s. is growing quickly as well. that is part of the strategy we talk about it all the time. it is opening up more of the locations closer to one another to get you your pizza faster they do work with some of the aggregators with master franchisees outside of the u.s but in the u.s., they're not partnering with the door dashes, et cetera. and avenlts say this may pressure same-store sales in the short term in the long term, good for business >> what is the allure of dominos? >> it's cheap. >> do you have to ask? >> we were talking about it before the show. >> all right >> i cover all the companies >> is the pizza that good? >> in college -- >> is it just about cost the price spoint a lot lower than most pizza makers and the convenience, the fact that they were, you know, delivering anywhere and at any time. >> they have the hot spots

the can you track the piz yachlt people enjoy that feature. one more thing though that is interesting from the conference call, yes, bill, i do think the pizza is good. i think papa john's is good and pizza hood is good all pizza is good. >> that's your beat. >> good for me rich also spoke a lot about the opportunity that carryout presents there is so much focus on delivery they're reimanling the stores. they have the kiosks in stores they want to continue to expand on the carry out part of the business they think it presents a big opportunity. investors reacted well to. that it reminded them, delivery is not the only game in town >> i think it's fascinating if he's right we've seen other companies be subsidized by the private backers come to market and not be able to make a goff it. y go of it if the threat is there enough for long enough, it's a real head wind for them i'm glad he thinks they can wait it out and they're going to win and the aggregators are going to lose there are a lot of other people on the side of that bet which i find interesting papa john's also having a good

year, by the way, up 31% the. >> knew cnew ceo. >> the ceo will be with jim cramer tonight he can xpound even more ex-pount now topic four finally today, and one that might blow your mind if you haven't seen this yet. scotch maker is out with a new way to get your whiskey. take a look. >> they have released a whiskey drinking experience. a collection of edible cocktail sap tulles made from seaweed pop the capsule in your mouth and take a bite to release the delicious cocktail ingredients >> i really thought this was a joke when i first saw it the capsules are made of seaweed. they're drawing unflattering comparisons to tide pods but, bill -- >> the connoisseur of the group. >> i'm so, so, so disappointed

in them. they should know better. this commercial where it says you don't need the glass or the ice or the cocktail stirrer. there is a romance and a tradition and a ritual around enjoying a fine cocktail and it includes all of those things:wh things what they're talking about is how astronautsdrink. >> and then they have to say the word seaweed i mean, is that going to get me to try one of these things >> they have to make sure it is ecofriendly. it's made of seaweed and the seaweed capsules biodegrade in four to six weeks. i was silly enough to think that people were eating the pods. i'm confused by the whole thing. >> it's biodegradable, i believe. you pop it into your mouth and then you take the casing out >> no. i think it is supposed to melt in your mouth. >> so it's like the listerine strips >> yes >> which are also kind of gross. >> and by the way, this makes it

more attractive, i think, to younger drinkers the. >> absolutely. >> i'm talking about really younger drinkers >> like candy. >> the flavored vaping things. not a good thing >> you typically don't drink witness yik, it's tequila and beer and over time, as your palette -- >> these are flavored cocktails. and they look awfully attractive there in the different colors. >> like many other things when i first saw the amazon echo dot and thought what is this now i'm convinced these are ubiquitous the pods for all -- if they can figure out how to carbonate them, i'll buy them. >> i'll buying them. >> pizza and whiskey pods. >> come for the drinks, stay for the pods >> thank you all still ahead with water levels rising and shorelines eroding, could oysters be the answer to protect america's coastal real estate we'll explain next

welcome back to "the exchange. a surprising new weapon in the battle to protect our shores from rising sea levels and increasing severe storms diana olig has details in the continuing series on the rising risks to real estate >> at manhattan's tavern, the menu celebrates locally sourced sustainable food, something transformational is going on in the trash. the tavern is one of the 70 new york area restaurants donating their wholly eaten half shells to repopulate the oyster reefs in new york harbor >> the when i learned a little bit more about the technique, then they had me hooked. >> oyster reefs are natural barrier that's protect shorelines from erosion, rising tides and severe storm surge

they knock down the height and force of waves but they've been decimated by a century of overharvesting and worsening water quality. >> we've seen a loss of 80% of oysters in estuaries worldwide zbllt university of north carolina professor antonio rodriguez studies oyster reef growth best way to protect the billions of dollars of coastal real estate from the effects of climate change is to go back to nature >> the goal is to keep people safe, weep tkeep their propertyt and making your environment more natural and learning the way the environment was before we developed it those are the best techniques. >> oyster reefs are rehabbed from massachusetts to texas. in projects by universities, local municipalities, u.s. navy and air force. >> this is where a billion oyster project grows our oysters. >> the billion oyster project is

one of the most ambitious, a twist on farm to table, it's table to farm with a 3 1/2 million bunt funded in part by state and federal grants from superstorm sandy it collects 10,000 pounds of discarted restaurant shells per week, brings them to governor's island to cure for a year, and then puts them in a hatchery where they spawn out offer larvey >> can you see two baby oysters. the aftermath of that, we realized just how valuable oyster reefs in new york harbor could be new york harbor had 200,000 acres of oyster reefs protecting the shoreline. and that population is virtually gone >> so our natural barriers to storm surge are gone >> correct >> and you're telling me that big old pile of oyster shelves is going to save us? >> it should help. >> the goal is to place one billion live oysters across 100

acres of reefs by 2035 bag by bag in order to receive federal funding, projects like billion oist her to prove that not only were they making the shorelines more resilient, but they were creating social resilience, that is bringing even the largest communities together to protect their own real estate. >> we want to engage communities everywhere because that's actually how you get long standing change, right if the community and the people that live there and work there are actively involved in stewarding your local environment. >> we're lucky to live and work in new york city where we have access to some of the freshest and the best and widest variety of species anywhere in the world. but with that comes a responsibility of the choice that's we make >> and diana joins me now. great news for the insurance companies. i guess. if this works. is there any push back or, you know, signs that it might be more difficult than it sounds? >> yeah, absolutely. there are roadblocks here. there are especially in the permitting and also with

poachers who go after some of the transformed reefs. but it's interesting you're looking at protecting some of the most expensive real estate on the coast. but part of the value of that real estate is the pristine beach. it's being able to walk out into that soft sand and soft water. so they can only put the oyster reefs in certain spots because people don't want to go out and cut their feet and that ind coo of thing you do get some push back on the permitting and zoning. >> can't keep them -- >> you keep them in estuaries, yes. you put them in certain spots. >> wow that is super interesting. i'll keep my eyes out the next time on one of the sandy places. dian diana olig for us. >> cannabis stocks down. is vaping to blame or something elimination going on here? we'll dig into that ahead. there is time to vote in our twitter poll today from the nba and tiffany and gap, companies have bowed down to political pressure from china. is that right move head ovetor cnbc on twitter

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welcome back to the exchange time to check out the results of our twitter poll u.s. companies will bow to

political pressure for china for doing business there, is that the right move 16% of you said yes it's the cost of doing business in the chinese market the majority, 84% said no. companies shouldn't compromise their values that speaks to what a sticky situation this will be for corporate america. is vaping the worst thing to happen to cannibas stock we'll take a closer look, next

last year pot stocks were the talk of wall street as more and more states got on board with recreational marijuana. since the launch of the cdc vaping investigation, cannibas stocks have been crushed tilray is down 40% michael, it's great to see you again. why is the crackdown on vaping hitting the hot stocks >> thank you it's hard to tell the exact correlation but there appears to be a minimum consumer, uncertainty. there's a bit of an opportunity

here if it is black market products that are clearly and definiti definitively causing illnesses then it should favor these regulated players and steer consumers in that direction. at the moment the authorities are investigating haven't been able to pinpoint it precisely enough to say it in way that gives consumers the comfort they need how the regulators might come down on it >> one of the reasons vapor is important to the cannibas industry is in states where it's been state legal for some time it adviser tends to be babout 2 of the caty. it's a piece of the puzzle that matters. that's where what the regulators decide really makes a difference keep in mind for the canadian operators they are still a

couple months away from having vape markets legalized in that country at all it isn't yet in the market there. that's something we'll be watching how consumers respond >> i understand that canopy and green thumb is something you'll favor. why is that? >> a focus from some of the more top line growth to terninhe ear and cash flow of the operations. while investors still care about the top line growth, the retail roll out in canada that been sloer th sloer than expected. we've highlighted them as two names that have strong balance streets. green thumb also has sustainable operations and wouldn't need a cash injectiono keep going a lot of other companies in the space aren't quite add

fortunate. >> what does it mean when you have these companies saying they will stop selling. i understand the overlap there they are trying to target a product that's hooked teens and prevent that from a larger blow back if this product gets pushed out of mainstream channels, where is it likely to go whether it's going to ultimately be cigarettes or if you're vaping cannibas products? >> for both sectors it's a question that matters because if the black market products are indeed truly the issue as seems most likely to be the case then in some respects the worst thing to do is give it consumers a greater incentive to seek those out and restrict the legal ones but retailers and authorities who are regulating the nicotine products don't want to be on the front lines of a new problem every one is trying to do

something they can to nip it in the bud. >> thank you for joining me. that does it for the exchange. i'll join tyler and melissa for "power lunch". thanks wall street feeling the heat as tensions between the u.s. and china reach a fever pitch. will either side back down with the markets on edge, we're 30 minutes away from jerome powell delivering a speech that could determine the fate of this market. we'll bring you the details. general motors strike revving up as it's in the fourth week we'll talk to the head of one county that's feeling the pinch. power hundrlunch starts right nw hi, everybody. stocks are falling they are el with off the lows of the day when the dow was down more than 300 points