programs is a work in progress >> devil in the details. that does it for us on the exchange i'll join tyler on power lunch right now. >> we start with breaking news, as we're just seconds away now from the federal reserve releasing the minutes from its last meeting. >> officials will believe the policy will be well calibrated the monetary policy was seen as likely to remain appropriate after that cut as well as the economy and economic data came in line with that forecast >> there were some divisions inside the fed on this issue a couple of the feds wanted to

state no cut was coming afterwards a couple called the rate cut a close call and two, who we know, they didn't want to cut at all. the fed said the cut was due to trade war and to take out insurance against potential downside risks there were concerns. there was concern with brexit and trade at the time. there was concern that exports would spill into the labor markets and consumer spending. they're okay with it -- not okay with it, but they're not all that concerned with weakness and manufacturing. they thought that would threaten the economic expansion several said the rate cut was better aligned by the way with the yield curve.

there was some financial stability concerns in the meeting. highly levels of corporate debt. no additional detail on what it might be they discussed options what they might do in the next crisis. and potentially interest rate caps nothing was decided in any of those regards. of course, the staff also presented plans on how to solve the repoe market problem, including a discussion no decision made on a standing repoe facility the big takeaway here is that the fed wanted to send a signal. >> that goes to my question, steve. on hold for some period of time. based on history, when the fed releases minutes like this, what does on hold mean in practical

terms. >> there were a couple other institutions where they did these rate cuts. >> powell, i know it was a couple years, two or three years until the fed got back in the rate cutting game. '95 they were neutral. neutral for fed policy is a year i think they like to be there for as long as they can. i think the bar is high in both directions at this point and the way the fed puts it is the economic data has to be out of line -- significantly out of line with what they're looking for. >> thank you very much. >> let's get to bob pisani for a

look at how the stocks are reacting >> not a lot of movement. >> i think the key is here we heard what the stock traders want >> the fed has been expanding its balance sheet as well. ing into i hear here dissuades anyone that the rates are not still high the greater revenue was passed around this morning. we'll have to wait and see before moving rates up again you have the consumer doing well, and the feds not going to be moving any time soon. the few red flags people bring up, 10 year yield, down 20 basis points we were close to 2% now 1/7, 1.75 or so

the gdp estimates for the fourth quarter it's 0.4%. it was 2% just two months ago. a few red flags floating around on the global economy. the big thing everyone watched friday is the manufacturing numbers. these are estimates coming to, and people use that sport or argue that the global economy is weakening. melissa, back to you >> let's go after the bond market and find out what's there with rick santelli hi, rick >> the minutes didn't really do much to change the market but in not changing it, there's quite a bit of info. look at the two year note you see it bouncing along the lows >> these are the minutes to the 29th and 30th. >> let's look at the end of september for 10

that low is 169 on the closing basis. if you look at the 30 year bonds, it's the same formation we're getting close to that area on 30 year bonds rates in the dollar look at the dollar same thing. those moves are dead, now we're coming back down and testing them there is not a lot of bounce in interest rates and the dollar is barely treading water. >> thank you very much let's get more from the fed minutes. welcome to both of you tom, i note in my notes that you say the bar is high for further rate cuts from the fed. >> well, the headlines earlier,

the phase one trade deal may not happen if it happens until 2020 does that change the outlook for interest rate cuts at all in your view? >> i think it would. >> if the trade deal goes away, we think that puts the fed back in play. they will know that i don't necessarily think that is the right approach for the fed, that's the approach the fed would take >> the information that came out. it doesn't mean it's necessarily going away in fact i would argue it's going too smoothly thus far. >> do you see any plausible connection between a trade deal, a phase one trade deal and what's going on in hong kong

right now? would that make the hurdle of getting a trade deal that much higher >> it was interesting when this new information came out that the trade deal may get kicked out into next year the sources weren't china, i would think if anything, it would be the reverse if anyone was upset about what happened, i would think it would be china and some rhetoric from them it didn't happen that way. >> how would your view of the market change going into 2020 if it went into place and phase one was not signed >> i think it's important to look not just at the timing, but what happens with the tash is. if it's postponed for a couple months, that's fine. as long as those tariffs don't go into effect if the president were to increase the tariffs

i think as long as we don't see an up tick in those rates, the market continuings to be fine going-forward. as far as those fed minutes that came out it's exactly what has been telegraphed by the fed over the last week or so. they feel we're in a good place when it comes to monetary policy, i think the bar is very high for them to raise rates >> i hate the expression is that a goldilocks environment for stocks especially as we're seeing the yield come down? and really stay within a manageable range here? >> i think as long as the u.s. economy does not go into a recession, we continue to be in a good environment for the equity markets the fact that we're going into an election year next year as long as you don't have a recession. the market historically has been up about 90% of the time in an election year. you have a favorable market

environment for equities going-forward. >> the president met earlier this week with chairman powell afterwards he said, i pointed out in his screw, interest rates are too high they're keeping the dollar too high that is hurting manufacturer's and growth a strong dollar does make u.s. exports more expensive and less affordable in foreign countries. there's his tweet, you can read along if you like to he does have a point about the dollar >> i think in theory, that's right, but i think if you ask any manufacturing company, what has hurt them this year, i don't think that the words foreign exchange are going to -- you're going to hear that other than from their lips. it's entirely about trade. i think that makes for a really nice cover to say that you think about the original

pmi's. manufacturing sentiment broadly has formed so poorly it's entirely a function of a trade narrative that no one in the united states seems to really appreciate. and so i think again we talk about foreign exchange but i think that's missing the point completely it's entirely about trade and here we are with trade coming into the crosshairs again. >> we appreciate your time today. >> the big headline rattling the markets is as tom pointed out. a phase one deal with china could be delayed until next year >> all this comes as tenses escalate over hong kong. officially backing protesters. last hour on the exchange, this could provide further leverage over china in trade negotiation

s. >> i think the president has been right to stand up to china. we need to multiply the leverage points with beijing not reduce them i hope the act will also be a new leverage point that makes it clear to beijing, we're not backing down and we're not going away >> the state papers tonight are mocking the bill calling it the support violence in hong kong act. china has been accusing the u.s. of fomenting unrest. the foreign ministry strongly condemns what it describes as america's cheap tricks it also said the u.s. should stay out of china's internal affair affairs and has threatened to take counter measures. they have gone so far as to

summon u.s. officials to lodge a formal complaint the bill requires the secretary of state to review the status of hong kong and see every year it meets certain requirements to remain autonomous from beijing and enjoy special privileges with the united states if that special status is revoked, it would very much change the dynamic of hong kong as a financial hub out here in the region foul, there is a fear that this move could further compliment the already fragile trade talks. officially, this is a major sign of support for hong kong protesters who beijing has been labelling as terrorists. however, i was talking to chinese academics, many of whom advise the policy makers here, and they said they still believe that the chinese and the u.s.

both want to make sure these issues are not linked. and then they also said they believe that the prevailing feeling here is that president trump himself does not actually prioritize hong kong in this relationship in the past, all the comments have been about how beijing should be handling this hong kong issue their hope is that he himself will continue to see the two as separate and want to keep his eye on the trade talks instead >> there's a very interesting point. there's a distinction between what the senate does and the administration does or says. the president has been relatively quiet i think is a fair characterization on this. without putting you in a difficult corner or position, what your reaction is to the

senate who said in the segment leading up to your report from where he sits, he sees this senate resolution as giving the united states an additional point of leverage in the trade talks. your reaction? >> yeah. well, so, actually, i didn't hear everything that he said because we were being blacked out about that segment the chinese are sensitive about it it is possible that it could be used as a point of leverage. i was talking to academics all day. for the most part, they think at the end of the day, hong kong won't be used as a point of leverage because they think president trump is going to continue to want to prioritize the trade talks. they believe he sees the trade talks as important for his political campaign

>> thank you for your insights and an insight that was a little inadvertent. coming up, president trump set to arrive in austin texas in a few minutes from now he will tour a company that makes apple computers. >> the big stock story of the day, target. what is target doing right that other retailers are doing wrong? each day our planet awakens with signs of opportunity. but with opportunity comes risk. and to manage this risk, the world turns to cme group. we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances.

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target surging today the stock ontrack for its best year since gerald ford roamed the white house. the ceo's of target and walmart talked about how they're preparing for a shorter holiday shopping season. >> it's going to be a very intense shopping season, every day counts we really made sure we're investing in our team. so $50 million of additional wages during the holiday season. >> you watch the calendar and we have six fewer days between thanksgiving and christmas which to a retailer is a big deal we're going to do a lot more volume per day now the clock is ticking just 34 days until christmas how much of an impact will that

ha have it's funny, people talk about the calendar, because we all know it's going to be short, but it feels like retailers start earlier and earlier in the game. >> nobody wants to be the one stuck with inving tory at the end of the season, it does feel like it's been pulled up a little bit there's been a move by e commerce a little earlier than they would have. >> what is target doing so well. >> they're going to stand for a really great design. that's apparel that was going to be in home, and understand that amazon's the most disruptive force in retail, they weren't going to out amazon amazon i think finding their lane and sticking with it, is going to be very powerful for them >> that was walmart's weak spot. they talk about having a better mix. selling more general

merchandise. is target better positioned for the holiday season i would say fundamentally different. the holidays are about key electronics, key toys, but i would say the target looks positioned with great apparel and great kind of design in case this may be a little different than what walmart has. >> where is target on groceries? has that been a success for them or are they a weak -- a realer weak >> the focus is fundamentally different right now. walmart is a place where you can shop for your family all week. target has a much more limited assortment if you want yogurt and ice cream, and maybe some snacks, but -- >> that sounds good to me. >> my shopping list. >> but yeah, i think that's right, i mean, at walmart you can go in and get your bib lettuce and brake fluid. i'm sure you can do that at

target as well but it is a different mix of general merchandise versus grocery. >> target's strength is? apparel. places like home decor it's where design is really important. they're competitive in food, but they're probably not your weekly grocery shopping that walmart might be >> how should we be thinking about valuation for target december 2018, the multiple on target was 10 and change today it's 20. it's doubled at what point does target actually warrant a rerating, or is it just expensive to itself >> i would tell you that i think we're seeing rereading across the states you're seeing retailers effectively. you see the likes of walmart and target that candidly are winners in this retail environment deserve more. >> thank you forcoming by.

>> thanks again. coming up, wasn't netflix supposed to be hurt by the wave of streaming rivals coming on the market netflix is still up 10% in the last month will the rally continue? tim cook has been criticized for being an operator and not so much an innovator. is that what apple needs right now, as it tries to navigate the china trade tensions is he a good innovatoroo t screening at her house. hi. this is the man that's going to check your eyes grandma. cognizant ai solutions are helping healthcare companies advance diagnostics and prevent blindness in patients with diabetes. everything looks good. you have beautiful eyes. ♪

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welcome back to power lunch, i'm mike santolli at the stock exchange netflix making a big comeback. stock up 7% in the past week disney has fallen more than 1% after the summer slump, is it safe to get back into netflix? investments, hello to you both if it is a com back for netflix it's a long way ahead. where does that leave you right now. do you think this rebounds has

some legs? >>. >> the stock is down about 26% it has been a pretty substantial lager. you've seen some real signs of this starting to bottom out and turn higher. you take a look at daily charts and you have broken a minor down trend we formed over the last few months netflix has started to bottom out and turn higher. it's a longer term picture when you look at a weekly chart that's more convincing you form a triangle pattern. really bottomed to where it needed to. we bottomed and now we appear to be moving back higher in this. so i think netflix is a much better risk reward over disney if anything, it's important to be selective in this kind of environment. i like this risk reward. and this goes probably to 3:35

and then right up near 3.60. >> nancy, for so long. next flex it's a huge market they're going to get payoff in all their content steppeding >> on our work what am i paying for unit of sales compared to what i paid in the past you got 60 times multiple versus disney's 30 times. and negative free cashflow of almost $3 billion. i don't know what to do with that for the long term. i don't disagree with mark that it certainly outperforms disney in the near term i'm more concerned about the long term. for me, disney is a better bet with the 1.2 potential yield

>> obviously it doesn't have to be a zero sum game thanks very much mark and nancy, more trading nation, head to our website or follow us on twitter at trading nation >> thank you ahead on power lunch, new trade headlines, rattling the market shares of apple in particular. taking a big hit as tim cook and president trump are set to meet in austin texas. rev your engines, we're heading live to the l.a. auto show how they're looking to drive into the u.s. luxury car market. and grave scale investments having bitcoin trucks initialized. if approved this could -- could this make the rocky road much smoother we have all of this when power lunch returns. and now, the latest from trading nation.cnbc.com. and a word from our sponsor. generally speaking, a strong dollar is good for business.

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welcome back, everyone, i'm sue herera, here's your cnbc news update at this hour prince andrew says he's stepping back from public duties with the queen's permission it's become clear to him that his association with the late jeffrey epstein has been a distraction to the family's work nancy pelosi pushing for gun background checks. mitch mcconnell has not brought the legislation up in the senate >> this is a solution that will save lives while many of the other bills are important. this one every day it is not signed and passed by the president, lives are lost. >> katherine few has been indicted by a federal grand jury

the three-year investigation centered on lucrative book deals for herself. she resigned in may amid fbi and irs probes >> you are up to date. >> markets right now off the lows of the session. >> those lees created when the headlines crossed when phase one of the trade deal could be delayed until next year. we have the s&p 500 down by half a percent. and the nasdaq is off by about 6/10 of a% the oil market is closing today. >> what we have are u.s. based intermediate prices. world benchmark prices, earlier today, the u.s. energy department reported that crude inventories increased by 4 million barrels this last week

you couple that with comments from russia, saying it's going to continue its cooperation with opec to balance markets globally and you get the pop you're seeing here. that's outweighing headlines you were referring to. keep in mind, even with those oil price moves today, they've been locked in a tight range over the last couple months. and today's gains get you right back so where you were. >> we are awaiting president trump's arrival in austin texas where he's expected to land shortly. eamon javers is live with more on the president's visit eamon. >> melissa, you were talking about the phase news on reports. that's the backdrop to this

entire meeting we're going to see today between president trump and tim cook of apple here in austin texas. as the president left the white house a short time ago, he said this to him is all about bringing jobs back to the united states particularly with apple >> we're spending a tremendous amount of money. and i've been asking tim cook from the day i got elected from the campaign, i've been asking tim cook to, if they would, we want to see apple build here, that way you have no tariffs it's no tariffs. >> so apple was able to get some tariff exclusions back in september, that's why they're able now to build some of these components, some of these computers in austin texas. most of apple's production is in china, but they are building some mac pro computers here, those are the high end $6,000 computers being built here

for tim cook, this is all about that december 15th round of tariffs that's expected if the phase one deal doesn't go as the president suggested it would new reporting suggests that may not be the case. what does that mean for apple, which is importing a lot of goods for china. is this going to hit iphone sales? that's the biggest piece of sales in any given year. there's some diplomacy here going on by tim cook, trying to provide the president anything he feels is favorable. back over to you >> thank you very much as tim cook and president trump convened down in texas, shares of apple are slipping around 2%, now it is a down day for the market as you see there. amid those reports over a delayed possible trade deal, the stocks still hovering near record highs despite all the turmoil over the past year can deaf lon tim keep navigating the ship through these trade waters and more.

joining us to discuss. professor at nyu stern school of business >> to the extent tim cook is viewed in the public sphere. i think it's a back handed compliment about him he is a brilliant operator everybody says he's a great executor the implication is that he's not a fantastic innovator. a couple of his innovations are now really by any measure a blockbuster? >> i would agree with that >> the gap i think to answer your question on the innovation piece, he has been stoking a lot of great products and advancing them those two combined are 8% of the revenue, those are businesses that didn't exist when steve jobs was running apple

the other piece around innovation that i think gets lost, this is a secretive company. i think there's some pieces around that that still are not affected in the apple share price and not affected in tim cook's record for ceo. >> it would navigate the political shoals as with president trump. >> yeah, one of the biggest skills that a tech ceo needs to have these days is smart government relationships and of all the tech ceo's in the united states top of the pile. you push back a bit on immigration early on apple is a different company from facebook to google. apple depends on the u.s. china

trade relationship he has forged this quiet relationship with trump. he's a good listener, trump's a good talker. there's some synergy there i'm impressed by the way he has kept apple out of trouble and kept this relationship -- it's a marriage of convenience. it's not an ideological relationship it's certainly one that's boding well for apple shareholders. >> how much does tim cook have at stake. >> if they go into effect what's your estimate on how that could impact apple's earnings? >> i don't think that they will go into effect but if you do fast forward and say it's going to go into effect i wish i could give you a simple answer we're talking about dozens of potential poen ends within this. and to figure out what each tariff is, it's probably not a great exercise, it would stoke more fear with investors than is necessary.

the most important takeaway, the meeting that's happening today would not happen if there wasn't some progress toward that december target. i think there would be distancing between the two parties, so we're not seeing that but that is -- what i think is the groundwork that's really being laid with this, is a small amount of apple's business apple's made a bigger commitment to the u.s., but i think this is good for longer term apple political relations. >> one final thought to button it off here, not only has mr. cook apparently navigated the interrupt administration quite deftly, he's also avoided stepping in it with respect to china. he's done very well with those relationships too. >> absolutely, i think that again, if you think about apple's dependence on china, you

realize that maintaining a good relationship with china, you look at what's going on in austin here, it's smoke and mirrors, right this is a plan that's been around since 2013. the $350 billion number that trump keeps throwing around doesn't have anything to do with apple's investments of the united states. it's the economic activity associated with apple. i think he's navigating these waters remarkably well many other ceo's can learn from him. >> thank you very much up next, we're going to go live to the l.a. auto show where it seems everyone is going electric phil lebeau is there.

>> i was told by your producer that she likes blue. how is she going to like this color of blue. check this out this is a new porsche all electric, it's getting a lot of attention today. we'll talk with the ceo of porsche about their electric dreams when power lunch returns. [grunting]

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welcome back to power lunch, the l.a. auto show kicks off this week as foreign luxury brands are pushed to grow u.s. sales amid u.s. tariffs on auto imports. phil lebeau is live on the ground with porsche's ceo. oliver bluma >> oliver,ed ceo of porsche, joining us you open this up for orders earlier this year what do you see in terms of reservations >> first of all. we got a very good pick since our pry mere in september. we had a lot of reservations, and we are looking forward to what's coming up now >> were you a little bit surprised by the reaction?

>> it's much bigger than before. it's a big step. it's an electric car we have a big response and we're very happy about it. >> you're planning on siling 20,000 of these worldwide. could you give us feedback >> i think we will increase and we will be up 20,000 early next year you. >> build this over in europe, and you're importing it here to the united states. potentially there could be tariffs brought down by the trump administration on all the vehicles imported from europe. does that matter much to the porsche compaustomer? will a tariff prevent them from buying a porsche >> first of all, we as a business company support free trade. and i think all increase of tariffs is against customers, is against companies who are

investing in the u.s. and against all the people who cover our companies in the u.s >> or is it more likely to hurt profits? >> no, it -- it could be sales, and profit also. we have different scenarios. we are watching very deeply what happens. but at the end, i hope that we will have a solution that goes into the direction of the free world rate >> so many other automakers introducing automakers do you feel it's a tipping point where we really see electric vehicles take off? >> for sure, it will be in the next decade. if it's 22 or 25 i don't know, it depends not only on the product, it depends on the infrastructure. but we are very confident, when people have driven the car, and they are so fascinated, so i think it will be earlier than

later. >> ceo of porsche. they're getting a lot of attention here >> 103,000 just for you, tyler >> that is a beautiful car i tell you, i want one right now. that is lovely >> thanks, phil. >> when can you drive it >> thank you >> one of the hopes supporting the price of bitcoin there will be an etf. >> are we getting closer to that day? ♪ ♪ not much, how about you?

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now bitcoin investment trust has filed form 10. if approved this would allow grayscale to tap into investors but could pave the way for bitcoin etf. joining me now, michael, great to have you with us. >> thanks for having me. >> why do this now >> the demand for access products for digital currencies like bitcoin have been tremendous it's been traded now since may of 2015. even in the last year we look at the trailing three-month trading volume it's tripled year over year, and that's despite any kind of performance of what bitcoin has been doing or what we've seen in

the broader market investors are coming to grayscale and asking for these access products. >> are you getting it from institutional investors who say we would like to invest in a product like yours, but we can't because it's not s.e.c. registered and wiekt they just invest in bitcoin themselves >> there are issues around custody and a lot of companies want to have exposure to the space, but then you start to figure out who at the company should have the keys, who at the company is going to do the due diligence and ongoing compliance, and the fact that we offer a family of products that are audited, that produce tax statements it looks and feels like many other instruments these institutions use as in q3, 84% were from noncrypto hedge funds that want exposure. >> what do you think this will do to the price of bitcoin you open the gates to institutional investors, the theory has always been, and the

price goes up. >> if form 10 is deemed to be effective, first time there is an s.e.c. company that's a digital product, greater access for institutions who need an s.e.c. reporting company to be able to invest in it and we'll also see a quicker liquidity option so investors can divulge of their holdings after six months as opposed to 12. >> you mentioned hedge funds as ones who are inclined to invest in this product. >> sure. >> what about others, endowments, public pension funds, mutual funds? what is the receptivitity there? >> the only institution we don't represent or have as a client would be a sovereign wealth fund a whole broad swatch of institutions and broad swatch of investment strategies. it's been validating to see that much inflow.

q3 we raised over a quarter billion dollars, predominantly for institutions. >> you side stepped the question about impact on the price of bitcoin. it used to be that was the theory, that institutional investors, once they're let in, will raise the price of bitcoin and eventually that didn't happen and people started giving up on that narrative, saying bitcoin could rise for a whole host of other reasons. which is it? what's your belief now >> i think one of the things we're talking about with investors is maybe not digested quite well enough yet, and maybe this is a question for brian and the "fast money" team. as we look next year into may and the bitcoin supply will drop in half, we look in context of when that's happened before and it's usually having a material impact on the price. our team wrote a good paper about it check it out but a bit too early to say what the impact is. it's an important milestone. form 10 is an important

milestone for the team, this product and to have in the bitcoin protocol. >> thank you, michael, for joining us. >> thank you, michael. crypto craze has kept pearlman ahead but he has fallen to nick lowery, who is leading, and mets pitcher noah syn syndergaard. >> oz was winning on the bitcoin. there is the door of air force one. the president has landed in austin, texas, where he is going to meet shortly at a factory that produces mac book pros. he will meet with tim cook and other corporate dignitaries there. the factory is not actually owned by apple it's own by flex. >> flextronices, uh-huh.

>> and the president has not deplaned as of yet but will shortly. >> important to get the ear of the president. apple doesn't want these december 15th tariffs to go into effect this could be a very important meeting. >> closing bell starts right now. >> i had a very good meeting with tim cook. i have a lot of respect for tim cook and tim was talking to me about tariffs. >> he has really put a big investment in our country. we really appreciate it very much, tim apple. >> the only one who calls me is tim cook he calls me. whenever there's a problem, he'll call. >> we're very proud to be part of it. >> thank you, tim. great job. >> thank you very much. >> they've got a history together, commander in chief and america's largest company's ceo. today, president trump and apple's tim cook will meet again to tour factory in texas this hour