and clash between no not in my backyard when it comes to more housing development and those on the younger said saying i can't afford to live anywhere. we have to change this or every one will be spries priced out that's a big problem for city leaders as well. >> sorry to cut you off but we have to leave it there that does it for the exchange. power lunch starts now we'll see you in a moment. we are just 24 hours away from the fed decision tomorrow with stocks at record highs jerome powell doomed to disappoint the market. mullenburg, the boeing ceo

testifying about the safety of the 737 max. we have the details. grub hub's failure to deliver. shares are cratered down 40% wall street abandoning this stock. a top analyst explains why they are waving the white flag. "power lunch" starts right now let's take a look at where we stand with the markets. the s&p 500 off a record high earlier. the dow is higher but still about a percent away from its all time highs now up just about .03 of a percent another rate cut is expected steve is looking at that and a key issue troubling the fed in the cnbc fed survey. >> let's take a look at what the implications are and then we'll

sge get into that issue. 79%. a bit on the low side for some but it's a clear and strong majority expecting that rate cut. they is sort of kind of one more cut after october of some kind part of the issue right now, the odds of recession picking up to an 11-year high at 34% part of the issue right there, it's only one issue. trade is a big deal according to the 42 he respondents to the survey 76 believe they have raised consumer prices. opt mitimism about a deal

nobody thinking a comprehensive deal is coming 17% don't believe there's going to be any deal at all. that number 80% is what they thought about a comprehensive deal twice before. we'll see and there were some headlines today. twice burned is where we're headed now if there's no deal when xi and trump meet >> officials say just because there may not be a deal signed in chile doesn't mean there will be a deal. all these show there's a bit of picking the can down the road. >> it depends on where you sit kind of in terms of where you

stand on this. what i think they will say is we have done what we kind of set out to do which is provide to the market they did that buy. to the fed view there's a lot of stimulus or easing then they want to wait to see how that effects the economy i think the message will be meeting by meeting you may think of that as hawkish. the fed will strive for a neutral zone here. i think that's where he is >> with the fed decision looming, the s&p 500 hitting an all time high. even higher by earnings. the picture isn't entirely rosy >> it's really two stories one u.s. consumer doing great. global cyclicals in not so

great. take a look on the consumer side look at mastercard their guidance the about 15% revenue growth. about 10% of the rev gnf revenum china. gm on the strike issue, also a little bit on the sign in but that's the week for the year it's not the case on consumer staples. it's very well we're not seeing reduction where are we what's going on. that's the answer to global growth the bad news is estimates for is cyclicals and industrials and

stocks have been coming down energy has been a complete disaster dramatically coming down where else do we get complaints from we're at new highs and it's shockingly light volume. for connect, for options, everything there seems to be lack of conviction here. we're not getting enthusiastic buying it's a lack of selling that's driving the prices up. remember, right now the market is expensive if you look at the 2020 number. five today was 70 million shares today. look at the volume here. 28 million shares in the middle of the day that's what i'm talking about. not a lot of conviction. back to you. >> weird thank you very much. with earnings on shaky ground and the fed decision looming, maybe the market is also waiting. can this rallykeep going

is there anything you can glean from this strong period of time. >> thanks for having me back i think it's fact we're out of the worst six months of the year and entering the best six months of the year. november through april, that's 7% on average. the calendar really is what people favor it's a good chance we'll get 20% for the year at the end of october a couple of days ago here. >> every stock that might be named, you have to take it with grain of salt. we hit the market bottom a couple of days before the calendar happen to turn. you look at the 52-week highs,

it's a totally different story for companies. what do you think is really going on >> i really think if we do hit new high and we will, it will be driven by a different cast of characters all the talk about market highs have been drif p by the defensive. if you look at about october of last year, which is important because that's when jerome powell made people worry he would put the economy in recession, all the market highs have been defensive. staples, minimum volatility stocks if we're right and the fed have pivot pivoted, and the trade war comes off, i think the formula going forward is much different. it's more cyclical and more value and more global stocks new highs but different players. >> we were having the discussion saying there was lag in monetary policy and all that easing that

the fetd has been workid has be come out that's where you stand so you're shifting more towards a cyclical at this point. >> yeah, i mean we're going with the caveat of political uncertainty. if those things kopt to turn, which we think they will then the narrative going forward is cyclical >> you like small cap values, value stock, international and also commodities at this point >> yeah. commodities are more for wish. if you look at the component while bond yields have gone down by 150 points, it hasn't moved a year ago today, it was 1.86.

today it's 1.77. we believe you have to have something with the federal reserve desiring to end the sickle right now we have a bit of inflation, not much. no central bank that wants to end it right now >> all right appreciate it. thanks very much mullenburg testifying in front of the senate. phil has all the fireworks phil >> we're not going to show you all of what the senators had to say but it's safe to say that dennis mullenburg was blasted by a number of senators they don't believe boeing has been totally on the up and up not only the regulators but with

the public >> you told this committee and me half truths over and over, including in that meeting. you have not told us the whole truth and these families are suffering. >> when boeing came to us and said it's the pilot inexperienced pilots, you were lying to us as well. >> senator, if i try to respond to your question, first of all the premise that we would lie or conceal is just not consistent with our values. >> dennis was drilled for about two and a half hours before the senate commerce committee and he's not done on capitol hill. he will be back tomorrow testifying in front of a house committee. tlp will be some tough questions as well. the victims' families were asked to stand up and hold up pictures of their relatives who died in those two plane crashes. krou can you can't really see it here but

i was watching from the gallery, dennis turned around he saw the pictures. he did not duck and say i'm not going to look at the family members. that was one of the most stirring members that he did turn and and look at pictures. then he came back and answered more questions it was a rough day for boeing and ceo. >> he was asked whether or not he would step down he sort of dodged that question. >> before he went into the hearing. we asked him point-blank if he thinks he should remain the coe. he said i'm not thinking about i'm thinking about getting the 737 max certified and back in the air. >> thanks. we've got a news alert on the streaming service right now. this internet tv bundle that starts at $50 a month has been

tied into game consoles and it's the smallest of all services the expensive content and network deals have been slower to change than we expected sony saying it's focusing on its core daily business. back over to you >> thanks very much. coming up, promise -- it's taking the stock down 40% today. we talk with analysts who stju double down the stock. we're delivering more power lunch after this

grub hub blamie ining promiscuo diners >> that's exactly what door dash

is, what mopost mates is. i feel bad for them. do you really care who delivers your food. there's no loyalty in that business that's why the diners are promiscuous. why did he have to use that word that word is saying don't touch our stock. >> it's becoming too congested for grub hub jag going into the quarter what do you think is the biggest thing you missed >> it's really that frequency, the amount of time existing designers were ordering from grub hub we already knew they were losing

market shares to door dash, uber and others i think investigators are okay on the customer they just weren't going to see as many it's going to cost more. it was that all of the innovation that the competitors done wp their product and we can talk about that is fiej lfinall hitting grub hub sgr did you think it wouldn't hit them things like loyalty and membership >> they have their version of a loyalty program. i don't think it's what uber could offer. again, up to this point you've seen a high amount of loyalty in the big cities remember, where grub hub does different is they have these in the restaurants. restaurants historically haven't had their own delivery

it costs the restaurants more to do third party deliveries. grub hub, whielg le we are seeig competitors, if you track that, we haven't crossed over. the bottom line is when you look at the company and say what is a diner worth, they are worth way less to the companies than we all saw. they said the industry growth is slo slower do you see a way out for grub hub or what you thought the business model was maybe 24 hours ago, does it no longer exist. >> there's definitely a business model if you can make money at it

it's 2% per transaction. makes a ton of money the idea is if you're seeing who you're effectively come down, how do you make money. you have to do a whole lot more order. they are competing with companies who have much weaker pockets and i think when you back them up against other internet marketplaces that we look at, the company has the lowest net cash balance as any other or there's one other similar, but they are just not prepared to take on these other companies and looked like they were doing okay and they're not anymore. most likely they are probably going to have to sell or merge with another company to try to get better share scales. we'll see what happens right now uber is offer rides and food loyalty

it can use the customer base this grub hub has. we do think there's value but not at this stock price. >> thanks for your time. in less than 24 hours we'll hear the fed's decision on interest rates another cut is expected. we'll look at how rates are using the housing market and how long it will last. major shake up in college sports those details that we just learned in the past hour when power lunch returns. and you should be mad at people who take unnecessary risks. how dare you, he's my emotional support snake. but you're not mad, because you have e*trade, whose tech helps you understand the risk and reward potential on an options trade it's a paste. it's not liquid or a gel. and even explore what-if scenarios. where's gate 87? don't get mad. get e*trade and start trading today.

welcome back as the fed gets ready theo make its big decision, one of our next guest sees a warning sign it's lifted nicely off the august lows. been hovering around 1.8 where do you see it headed next? >> the key levels that we're

looking at are at a very critical juncture here just below that level right now. the reason why that is important is that that 1.9 prts where t% trend line is a high it will give it both take it above that line and give it its first higher low sequence in over a dwreer. it holds there and has implications for the bond market but also for the stock market as well let's face it, banks are cheap and looking for higher rates to help them move higher and utility stocks are expensive it could cause a rotation in that market. it's an important juncture for a couple of different markets. >> it was late july when that yields cracked 2% in a pretty dramatic way they recovered since then.

i guess with the fed coming perhaps one more time and going on hold, does that mean the bonds could be stable for a while? >> i think it's changed. a lot of it you have brexit. you have tariffs current agreement. you have an extension of the tariffs. all of those things believed is more complicit we have whether or not powell's signals this is the end of the mid cycle correction if so, i think you'll have a lot more upward pressure

>> in a negative way >> potentially yes >> certainly when you put upward pressure on their yields we'll see how et goes. right now the market seems steady heading into that rate decision which we'll get in about 24 hours for for more trading nation head to our website or follow us on trading nation back over the you. low rates boosting home sales but is the high end for home builders. we'll ask one analyst whether the stocks will hit a wall cannabis pot industry expected to be worth $4 billion next year. why products could be what fires up growth. the ncaa board of governors will allow college athletes to receive compensation for use of their likeness those details when power lunch returns. woman: my reputation was trashed online.

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welcome back here is your cnbc news update. vice president pence viewing training exercises at ft. hood we watched a live fire demonstration at the texas army base involving n1a2 tanks. he was scheduled to spoke to soldier and civilian personnel a judge blocking alabama's effort to ban all abortion ruling the state law critic criminalizing all abortions as illegal. a powerful earthquake shook the philippines killing one person, injuring dozens and sending people out of their homes and buildings. the 6.6 quake was caused by movement in a local fault.

prince harry preventing the invictus games they will compete in the netherlands next may it's an international pair olympic style multisport event for injured war veterans you are up to date that's the news update this hour back to you. we are off the high by 30, 40 the dow is up by two points. the nasdaq is down by .4 now for today's power movers how about shares of beyond meat. they are tanking today about 65% lower. they are down 20% on the session. the company posted a bigger than expected profit and raised guidance and investors and insiders are bailing as the ipo lock up period is expiring

general motors warned it will take a $3 billion hit because of the uaw strike we end with two big drug makers, p pfizer and merck : we ha we have a news alert on fiat chrysler >> they are in discussions about a possible combination with psapeugpsa peugeot. it's mainly in europe. they also have large exposure in china and parts of asia. they have big exposure in north america with jeep and exposure in asia.

it would create a $50 billion auto maker and give both companies the kind of size and scale they would be looking for. we have reached out for a comment from fiat chrysler we have not heard anything don't be surprised that this talk will start to heat up because many people believe the auto industry is right for consolidation. we know that fiat chrysler was looking a t a possib ining at a combinati combination. that fell apart. >> chrysler has been in talks so many times i'm sure you can't keep track anymore. do you think this could run into resistance by anti-trust officials in europe? >> not at first. people said what about peugeot that's starting to be a possibility. thank you. now to major shift in college

sports the ncaa will allow athletes to be compensated for their images and likenesses here so explain, eric and jabari young join us. this news just broke >> the ncaa board of governors were meeting they said they will start the process to enhance name image and likeness opportunities it's not about getting paid from the school but you want to get some sponsorship deals, sign some autographs and nowhere did it say we will definitely allow this to happen we're going to start working on this we're going to start looking at rules and gather feedback. we have all these rules to make sure they stay within the college motto and not within the professional model we're going to start the process but we're not guaranteeing anything just yet. >> you're thinking through this. first of all, it's a very quick response to what california had

done to try to move forward and say we want our athletes to be compensated for this and saying to the nca it's your move. what would be the significance if this ultimately does come to pass >> it has to come to pass because the ncaa cannot abide by all the rules that the states wanted he wanted 15% of all college sports revenue to be given to the student athlete. florida has another set of law california has their law the ncaa cannot abide by there law. they have to do something and credit to gavin newsome. he put many in place once government interferes, there is no turning back >> how much money could be at stake for these students >> depends what they allow they could benefit but only up to five grand. you could benefit but only up to ten grand. the first bullet point is sure student athletes are treated

similarly to not athlete students so that's the first caveat that says we're going to start working on this. there's already been tweets saying don't get ahead of yourself jay has been noticed for his i'm not going to get sucked into the ncaa saying we're going to try to work on this but if it doesn't really fit our needs we might not do it. >> they might be trying to have it both ways >> there's still a law in place. he says if you got three years, we're coming to get it if you don't have it together in three years. new york is the same way >> there's always a local representative who has got an affinity they have a bigger lobbying power than professional teams. a lot of these colleges are public run institutions. they would say we're going to work on this

maybe get some kids 10 or 15 gs. >> it keeps getter than that states can't allow these nice recruits to go off to all the other states that will be paying them morning right now california has the advantage. if i'm an athlete, california or pennsylvania i'm going to say california. >> new jersey did it and then pennsylvania and new york said we need to do it too because new jersey will do it. >> money need to be earned >> if this is train is headed down the track, what does it mean for the amateur status of olympic athletes does it raise though questions as well. >> if you're in an olympic sport at a college, if you're on the rowing team or the tennis team but if you're random guy doing archery at home, nobody cares about you. >> if somebody says i'll give you 500 bucks, i'm taking it that means i won't have to eat ramen noodsles.

>> a lot of switchers have to decide if i'm going to go pro or stay in college. you're doing your best swimming in college >> it's not about those kids it's about the inner city kids those kids who are going to represent these kids who don't have anything. they don't come from anything. i come from north philly i know what it's like to not have these kids that come from the inner city neighborhoods will benefit because now they can help their parents they can help their mom or dad pay present livie rent living m projects that's why i think this bill is great. >> even sure i'm say they will say that's more than we were working with >> better than nothing >> thanks. marijuana stocks low r across the board after disappointing results.

>> a 10% decline in revenue. that decline put lot of pressure on the sector just as a new revenue stream opens up with the legalization of edible and drinkable cannibas this month. today the company offering a tasting of those products without thc at its headquarters up in canada he expects consumer roles to be a driver for attracting new customers. canopy selling several brands of edibles and eatables also tokyo smoke a chocolate, both of them with cannibas >> we can produce a product that is pro siecisely dosed.

that is major step to overcoming one of the ob ta. >> caller:s th-- obstacles that consumers face >> it's expected to grow to $3.7 billion. consumerables are expected to be about 10% of that. next, if you think markets are scared of elizabeth warren, what wouldapn hpeif bernie sanders got elected? we'll hear from senator sanders on what his democratic socialism would mean for business. stay with us robinhood believes now is the time to do money.

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♪ welcome back it's the day before the next fed decision let's get to the bond market where rick is tracking the action rick >> if we take some charts back to the last fed meeting, the last decision the lower court appoint, september 18th. you should note a couple of

things maturity yields are lore thwer n they were but long maturities are higher as a matter of fact, all maturities are the highest levels in october and they go back to various points of september. since last fed meeting it's really got the hit it was acting really solid most of 2019. the question is why are traders behaving this way. is it a fed issue. there's a lot of growing criticism about over seeing central banks. it's probably both tomorrow we get fist look at third quarter gdp. a biggie for traders and we'll get a glimpse of what may occur on the jobs number kelly, back to you >> that's right. thank you very much. the mortgage rates pending home sales rose to a 21-month

high in september. nearly 4% from a year earlier. we got a read on august prices they rose just over 3% nationally the home builders were at 52-week highs. the fed is expected to deliver another round of rate cuts ken, it's been great year for these stocks the game has made it this point. >> that's the debate for investors because the stocks, the home builder index is up 60%. last year it was down 35%. the year before 75%. this is a hyper cyclical group you got to get it right. >> is it more dependent on race, the macro environment. what's the key fundamental factor to watch? >> i think it's transitioning to

be macro we're going into the slower winter months. we're seeing the slow down in order and backlog value compared to unit volume part of that is moving to entry level homes. the other part is maybe the housing market is pulling down a bit. >> is there a seasonal trade involved, ken? we had tom lee on earlier this week he had done a study and found that we're in a golden period of six months from october 20th through april 20th home builders out perform the s&p 500 and it's happened nine of the past ten years especially when rates are rising. i'm wonder if you see seasonality as a factor at all >> it's a great question what i'm seeing is anticipation of that kind of rotation and performance happens a bit before you anticipate the period. home builder stocks have done

terrific since mid-august. >> i see you have a buy on taylor morrison and the rest on toll brothers. why taylor morrison? >> they report tomorrow to get stronger performance as a home builder you need the aggressi aggressively increase community count and migration to entry level and first move up. they are doing a terrific job. it's easier on year over year whether it's taylor morrison, kb homes to get that kind of comparison if you're a larger builder in the near luxury market and geography, some of the more difficult areas, the year over year comps are much more difficult. on a relative basis that will lag. >> appreciate it today thank you. more and more fund managers are warning about market sell off if elizabeth warren is atected president. wh about self-proclaimed

socialist bernie sanders what if he wins? what happens to markets then that's next. staffing a small business is challenging.

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how they feel about brrnernie sande sanders, who calls himself a socialist. john harwood sat down with senator sanders and asked him how thought he could pull the u.s. towards democratic socialism. >> well, depends, you know, what we mean by democratic socialism. what i'm trying to do in this campaign is pick up where roosevelt left off and say that economic rights must be considered human rights. i uniquely, in all due respect to my colleagues, i am taking on the insurance companies, the drug companies, the fossil fuel industry, the military industrial complex, the prison industrial complex, wall street, the democratic establishment there's a guy ahead of the corporate wing of the democratic party. and he said, bernie sanders is an existential threat to the democratic party

i agree with him, i am i want to convert the democratic party to break its dependency on big money and corporate interests. >> would it be your intention to appoint democratic socialists to big -- >> well, you're making -- you're going a little bit too crazy on the word here. i will appoint people who believe in the working class and the working families of this country, who are prepared to stand up to the incredibly powerful corporate interests that today dominate our economic and political life so, when i talk about democratic socialism, you want to talk about, what does it mean let's be clear, what does it mean let's not get people overly nervous about it what it means is that health care is a human right. not a very radical idea. >> john harwood joins us now from washington. and john, it is elizabeth warren who has surged in the polls lately and thus the reaction when asked what that would mean

for things like the stock market have bernie sanders, in a way, and elizabeth warren might actually go on to win. who knows? has bernie sanders in a way already won? because the party now reflects so many of the priorities that he's said he's been pushing for three decades. he said he wanted to -- i forget his language there, make it over or, you know, he was an existential threat now they've kind of come around to his point of view >> well, kelly, it's a good point. he claims credit, partial credit, since 2016 in his campaign then against hillary clinton for having moved the party on things like medicare for all, on things like free college at public universities however, he's still in this thing. and he -- there's a new poll out today in new hampshire that shows him in first place in new hampshire. he does trail both joe biden and elizabeth warren in the national polls. but he's got more money in the bank right now than any other candidate in the race, so he's

got a little bit of room to run here and it's interesting, in our nbc "wall street journal" poll, we've shown the two characteristics that voters consider least attractive in a democratic presidential candidate are, one, being a socialist, and two, being over 75 years old bernie sanders is 78 he just had a heart attack, he's a democratic socialist he's still in this game. >> you know, john, in our introto your piece with bernie sanders, we mentioned paul tooututo jones and his comments about a stock market decline he was guessing that an elizabeth warren victory would send the stock market down 25% a sanders victory would send the markets down by 20%. i'm wondering if bernie sanders himself even cares if the stock market could or could not do in response to his victory. >> well, i think, at the moment, getting criticized by people on wall street or having predictions of that kind for both warren and sanders are positives within the democratic party. a different story if you actually get elected and then you have to superintend

the economy. then you're a little bit more concerned about the consequences he does say that he wants to fundamentally change the way corporations are governed, but he does not want to get rid of private corporations and if bernie sanders manages to get elected, which i think is a less than 50/50 chance, but it's not impossible, you would likely have a democratic senate and then you would test how far you could go with his agenda he says by putting public pressure, he could get even conservative democrats like joe manchin to come around to his program. we will see if that's the case, should he break through. >> all right john, thank! >> you bet >> john harwood with the latest speak easy and chk,lee!s xtec pas ine when i lost my sight, my biggest fear was losing my independence.

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check, please. >> obviously, fed is front and center for tomorrow, but we're also going to be reporting apples in today's session, interesting price action for apple hits a new 52-week high, all-time high, and now it's back down by 2.6% it's interesting positioning going ahead. we're seeing for a lot of these tech names, a run-up to earnings and a sell-off out of them so you wonder if this sort of lowers the bar >> the hot now trade lately has been apple and jpmorgan. interested if earnings is a headwind for that. and i want to mention kellogg, which is higher for today. they said demand in pringles and chee cheese-its is offsetting the

drop in sugary cereals >> i'm going to make muddy buddies. have you ever had muddy buddies? >> no. >> the chex and the peanut butter and chocolate >> like a sweet and salty thing. i like them segregated thanks for watching "power lunch" >> those pilots never had a chance these loved ones never had a chance they were in flying coffins. >> you have told this committee and you have told me half-truths over and over again, including in that meeting. this is why i'm so upset i would walk before i was to get on a 737 max i would walk >> you're the ceo, the buck stops with you did you read this document and how did your team not put it in front of you, run in with their hair on fire, saying, we got real problem here? >> that was the u.s. senate putting boeing ceo dennis muilenrg