buy peloton, you'll get there. lulu has been trashed. all i can think is there is a seller out there liquidating it. their stores are open. buy it today >> you tell him 15, he takes 30. pete, you have less than 10. >> the reality is they're buying calls. i think you have to buy calls in here i already own stock. i'm buying calls right now >> have a good week, everybody "the exchange" starts right now. thank you, scott welcome, everybody here's what's ahead this hour. investors are battling it out for control of this market, and despite warnings from some high-profile investors this week, bank of america is saying, don't worry, the bull market is still alive and well are they right as the market weakens a little this afternoon, we'll definitely ask. americans could be saving as much as $500 a month on their mortgages, but many aren't yet we'll tell you if you're in that camp peloton does ride higher,

grocery stores could be a thing of the past and doubling down on tesla. let's begin with today's market to close out the week, dom chu, with the numbers. >> that's a lot of stuff you're covering in "rapid fire" today my head is spinning with all the things we have to cover. the market sits at a fairly volatile week. generally speaking, it's still been a pullback to the relative highs. the dow sitting back about 80 points, well off its high so far. the nasdaq again, pacing the declid declines of 1%, a pace we keep watching above that 11,000 mark. if you a a lolook at this week,e best-performing sector, believe it or not, is materials. up about 1% so far from a sector basis and the worst performing is energy. those two sectors typically get

lumped together in terms of performance, but in this case scenario, very different an interesting move here with the sectors so far this week and to top it all off, we've been talking so much about these technology and cloud names that benefit from work from home and stay at home let's talk about some other names that have flown under the radar. the best performers on a one-week basis, among them uber. we haven't talked about that in a while. up 11% under armour, athletic apparel up 6%, and sam adams, up 8%. so many have gone up in a down week, kelly. back over to you >> thank you, sir. what he's talked about in the last two weeks have put the s&p down about 6% of their highs

bank of america says they're experiencing a normal correction and the bull market is alive and well are you still optimistic about this market, randall >> i'm not a technician so i'll not even project what the market is going to do over the next month, et cetera but given the low level of interest rates we have, this market can do much better than you would normally assume for some time to come. >> so you are in the camp, randall, that means low interest rates means higher tostock valuations, but is that a one h one-time reset or do we keep resetting? does it have to keep going down for the market to climb or not >> it can't keep going down. i would go so far as to say that

eventually interest rates must go up. and that's the reason we are so focused on buying value stocks that we think we'll be able to stand up well in a really tough market environment >> you have to be a brave man to do that right now, because it has not been the best time for value stocks, but that's what would make value investors more interested >> either brave or a glutton for punishme punishment >> maybe both. >> mike, let me turn to you and see if you echo those thoughts of the kind of stocks to pick up in this market and if you agree with bank of america that the bull market is still intact. >> i do, and i think this is healthy, this is normal in a bull market, and we could even go down a little bit more from here, say another 10%. but i think as long as the economy recovers, whether it's gradual or gains momentum, i think as long as people get back to work, consumers spend, and obviously this is not happening at the moment, but we are

gaining some momentum with economic growth. hopefully that continues as we come out of covid. then i think that provides some economic support the cost to capital is cheap, as was mentioned, so that bodes well for equities going forward, and you could get back some of that multiple expansion you've lost recently here the rally broadens out it does get more into a cyclical growth not the high-tech names, though those would still perform, but economic cyclical names. materials, i found that interesting that materials was a top performer this week, and that's where i would be putting money going forward. >> when i see you, michael, i know you're big on gold and the precious metals and that sort of thi thing, and i wonder what your thoughts were on the cpi report. there is a fed meeting next week in which they kind of seem to be laying out this template toward more accomodative stocks

should that lend credence to metals >> gold broke out this year, although it had a couple good years before that. money supply, we've grown liquidity fantastically over the last few months. even though demand is down at the moment, you have a lot of money chasing fewer and fewer goods. you have supply disruptions in a lot of places so some goods will be very expensive. so even though the broad number might be a little slower growing, there is going to be bigger inflation in certain consumer goods and if you get economic growth, gradually rising interest rates are a by-product of economic growth, so that makes sense also, given the low cost of capital. gold would be a good anchor to hedge against inflation and rising prices with all this liquidity. the other thing to keep in mind is we didn't see inflation ten

years ago, but the stimulus and monetary issues that were done this particular go-around versus '08 have been very different they're getting to main street, consumers are spending, businesses are spending, ppp loans and the like, and that will increase monetary velocity chasing fewer and fewer goods. >> randall, when i get to you, i think of at&t. i wonder if people can count on that 7% digital yield, maybe too good to be true. also what happens if rates do start to move higher, what happens to a lot of your kind of favorite dividend stocks do they become less attractive >> i think some of them may, but i think at&t is safe for the foreseeable future but even if it's dividends cut, there is still a great yield let me just refer to inflation for a moment i'm a real believer that the moment an ideal is expected

almost universally, it's probably over. and with inflation, i'm not going to predict exactly when it's going to start, but gold, for example, just adding to the discussion here, is up about 30% so far this year but also for the last five years, gold has been moving up it's been running almost 12th of the year we've seen early signs of inflation, and i think sooner or later, that will drive interest rates up, too, however slowly. >> interesting so you're not counting that idea out. in other words, once everybody sees it coming for you, then it's already here, but for right now it remains a compelling argument >> that's right. and i'm not saying gold can't go up more, it may very well, but it already is up, and i would not be surprised to see official inflation statistics over the next two or three years beginning to move in the same direction. >> that's going to make it an interesting time for this fed, that's for sure. gentlemen, thank you for joining

us talking about some of your stock picks today. really appreciate it randall eley and michael cuggino. the largest supermarket chain in the country had earnings this morning. they blew past analysts' expectations for a closer look at the numbers and what it may be telling us about where consumer prices are going from here, susan eisen is here susan, welcome >> thank you consumers are still eating from home six months into this pandemic thanks in large part to 127% growth online as customers order digitally and pick up their groceries. the outlook for the second half also exceeded expectations com store sales for kroger expected to rise 13% they're also expecting higher profits. as ceo rodney mcmullen says, they expect the eating at home trend to be with us for a while. inflation, as you guys were

discussing, is also certainly helping their profits. and to that point, in today's overall cpi report, we did see consumer prices rise more than expected for the third month in a row, thanks in large part to used car prices spiking on high demand as far as food prices in particular, they are still elevated if you look at a historical basis, but if you look at the monthly changes, they are starting to come down for food at home or grocery store prices, and that's in part because of meat and poultry shortages that happened during the pandemic, remember, they started to ease, and those prices are coming down also people are starting slowly to eat more outside at restaurants than they were at the height of the pandemic the biggest takeaway on inflation is it is showing up in spots where the demand is, kelly, and that is in autos, in shelter we saw this month, in apparel a little bit even higher in the last few months but the fed says it's not worried about it, and what it is reflecting is this strong bounce

that we're seeing in the third quarter in terms of spending and areas of spending like groceries. i think the big question is what happens next in the fourth quarter and beyond after this initial surge of spending and consumer activity fades along with government stimulus >> absolutely. it's really going to be fascinating to watch this dynamic between the fed on the one hand and the cpi on the other. i'm curious on the food price front in particular and what the grocery stores are saying, because lately i've had some positive sticker shock at whole foods when i check out i think, geez, these produce prices are much better than i ever remember them being you know, it's obviously not true for everybody yet, but is there a sense in terms of the supply chain, at least, the shortages are being worked out and those prices should come down >> yes so, really, the only acute area in terms of groceries in categories in supply chain was in meat and pole tultry, and the

were widely known that workers had to call out, there were major covid outbreaks in a lot of the plants, they had to shut them down. that is working itself out right now, and mcmullen said they expect those prices to continue to even out. we saw that in the data. yes, higher prices for fruit and vegetables, for dairy, we've even seen it lately for baked goods and cereals, and it's largely a reflection, kelly, of what people are buying in that demand that's why economists aren't super worried about it because they see it as a result of some of the consumer behavior changes around the pandemic. also an interesting tidbit from "the call" this morning on kroger, people are buying a lot of beer and wine, so maybe we'll see elevated prices there. they're also buying more packages >> we're doing 20-pound bags of rice these days and cereals. thank you, susan she will be talking with rodney

mcmullen later today. let's bring in josh lipton what's going on, josh? >> apple is releasing guidelines as they do every year in anticipation of a new operating system, but what's an interesting section is what apple is saying about streaming games. they say streaming games services are permitted, but each game in that service must be submitted to the app store as an individual app so apple says that policy is in place to protect the customer, but that is a potential problem for some big tech powerhouses like microsoft, for example, that are releasing these new cloud gamestreaming services, and these are services where you would sign up and then access a bunch of games from the cloud. of course, in that model, apple doesn't know what you're playing. it has not approved each game in that service, and companies like microsoft have said that's an issue because those policies

that are put in place here would prevent them from launching these kind of new services on apple devices. a real basic tension between app store rules and how these new game services are structured, potentially, of course, setting up some new tension between apple and heavyweights like microsoft, kelly >> josh, stay there as apple and alphabet shares hit 100% let's get to kiff westwing kiff, i just downloaded stadia on my phone to try to understand what's going on here, and there is a long, long list of all of these games that you can play because it's aggregating this content. are you telling me you'll no longer be able to use the app that way >> yeah, that's exactly right. what apple wants is apple wants every game on stadia to have its own listing on the app store

that means if you had a public game, you would be able to download it from the app store and not just access it through the stadia app >> how infuriated are microsoft and google likely to be by this move, kif, and why do you think apple would make such a provocative gesture? >> well, apple really values control of the app store it says it's for safety and security so the users know they're going to have a great experience, but you know a lot of people think that these streaming game services are going to be the future of gaming and so microsoft is going to be upset. i haven't heard from them today, but a couple weeks ago, they put out this really -- this statement that said, you know, apple stands alone it's the only general purpose platform to deny consumers >> josh, what would that mean for apple and why would they make a move like this at a time like this when they're already

under a lot of antitrust scrutiny over the apple practices? >> so apple is going to say -- kif is right apple is going to say, listen, we have policies in place and these policies were put in place to protect the customers we want to review every app. if the app is going to use a payment processing system, it should be our system the safety and security, they'll argue, is one reason the store has been so successful in the first place. that's why there are too many apps available to consumers. to your point, kelly, it is certainly coming at an interesting time for apple we know the app store is under intensive scrutiny by regulators they have that nasty ongoing fight from the creator of epic i have not heard apple, though, budge on some of these issues. they have remained very firm, saying most of the apps are free when they do charge a commission, it's largely in line with other digital marketplaces and they'll argue that competition is alive and well. to kif's point, they must have

known this would certainly frustrate some big tech heavyweights like microsoft, like google, but this is the policy they have in place. >> game makers like ea, if i can go from having hundreds of games in one access rather than downloading them individually, wouldn't that hurt the game makers as well >> yeah, it's really about controlling the customer this goes to epic, too they want their own app store and that's why they're battling apple. they want to be able to access the games quickly, and the big guys want to bundle them up. >> their session low is down 1.8% a fascinating move by apple and nobody is trading higher on it so far as i can tell josh, thank you so much for bringing us the news josh lipton and kif leswing, thank you so much as well. we'll continue to keep an eye on that story. the dow is holding on to a

10-point gain. football kicks off with mostly empty stadiums and an uncertain future we'll talk about how much investment money is riding on this succeeding. the refi boom. why and who is eligible. and a big battery that could be more electric more details after this.

welcome back to "the exchange." just under 16,000 fans attended last night's nfl season opener after the chiefs instituted a 22% capacity cap, and only one other nfl stadium will be partially filled for games but there won't be any fans in attendance when the los angeles rams host their first game in their $5 billion sofi stadium. what impact will the nfl have on teams look to go pay off this stadium debt a municipal strategy for wells fargo, he worked on yankee stadium and sit citifield, amon others welcome, randy gev gerardes >> thank you, kelly. >> so who bears the brunt of

this loss? >> clearly if you don't have any fans in the stadium, there is clearly a revenue impact for the public side where you had states and localities who have financed these stadiums, the revenues will continue to flow it really depends on a political sort of understanding with all the pressures at the local level to be able to pay for a stadium that's empty is a pretty difficult pill to swallow for politicians. revenues will flow on the republican side on the public side on the private side, you have to look at the structure of the transaction to really get your comfort level on what the risks are. >> let's start with the bondholders. this is an investing show, after all. who for the most part is exposed in terms of stadium finance debt, and who stands to lose the most if these deals have to be restructured >> sure. so, i mean, we actually think that bondholders are typically institutional investors, though

you will have some retail investment dollars after all, it was tax exempt in a high retail market but really the team owners are exposed to a certain extent, because just like a house is one of the biggest assets for a person's balance sheet, these stadiums are pretty important to the valuations of the teams. if you look at most recently they released the valuations for the top ten teams, and most of them had reconstructed or new stadiums so these revenues are pretty important to the valuations of the teams, and the owners, obviously, are pretty focused on that revenue stream. bondholders are definitely on the hook, but there are a lot of belts and suspenders to these transactions we have seen strikes, for example, which typically these transactions do have an ability p

to maintain cash flow for a strike up to a year, so there are some supports here but at the end of the day, this pandemic, we're not sure how long it goes and how it will play out >> i can see the best-case scenario is akin to a strike next year the stadiums are full and nothing changes, but what happens if people lose interest, don't show up the way they used to, team owners aren't getting the value they thought they would be getting what happens then? >> sure. so a lot of these stadiums were constructed with this concept of contractually obligated income, so you have naming rights, for example, that are long-term contracts. you've got suites and luxury suites as well, luxury seating generally overall, so that revenue is going to continue to flow the issue is stadiums in terms of concessions, some of the impacts with respect to workers that rely on stadiums for their employment, that's certainly something to be monitored. but generally, these deals do have some ability to withstand

it going forward we had already seen that the technology increases at home have moved people to the couch from the stadium already. so it's going to be something that bears watching for sure >> yeah, especially if it turns out we've been already at peak valuations for a lot of these teams, which would surprise people randy, thanks as always. appreciate it very much. >> absolutely. thank you. >> randy gerardes talking about stadium financing. coming up, jp morgan want a chance to get in with some of the busiest companies. remember, you can always listen to us live and on the go on our cnbc app. we're back in a couple [ thunder rumbles ]

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welcome back to "the exchange." quite a reversal to close out the week the nasdaq was up earlier about the same amount it is down right now. it's at a 115-point decline, a 1.3% drop. some big changes with apple as to how it's going to allow gaming through it's app store. that pushed shares of apple, microsoft, alphabet and other gaming companies to all-time lows let's get an update from sue herera sue? >> judge john gleason has urged a district court not to drop the case against trump's ex-adviser john flynn gleason originally argued against the dismissal back in june johns hopkins researchers has found that those who practice outdoor strict social distancing had one-tenth the likelihood of getting covid.

dr. anthony fauci warned about the rise in baseline infections going into the fall. >> when you have a baseline of infections that are 40,000 per day, what we don't want to see is going into the fall season when people will be spending more time indoors, and that's not good for a respiratory-borne virus. you don't want to start off already with a baseline that's so high. >> dr. fauci also mentioned the fact that it's complicated, kelly, because we're now going into flu season. back to you. >> i know. oh, goodie sue, thank you so much we've got a news alert on tiktok let's bring in dom chu with the details. dom? >> the headlines involving tiktok is coming from reuters. what they're saying by sources familiar is that china would rather see tiktok u.s. close its operations than see a forced sale to another tech company in the u.s. again, that's according to reuters citing sources familiar

within the chinese government. this is also an interesting situation as we take a look at the stocks of microsoft, oracle and walmart as well. what's curious is walmart seemed to react more to those particular headlines but again, according to their reporting. china believes a forced sale would make both bytedance and tiktok appear weak in washington, d.c. we'll see if it plays out more, but we'll keep an eye on all of those companies as the afternoon progresses, kelly. i will send it back over to you. >> companies like snap might be seen as a beneficiary, some of the smaller ones as well dom, appreciate it, sir. maybe working from home isn't the future for everyone. peloton impresses but was it enough

the nfl reality, more hot pizza, and more won't be returning to the grocery store stay with us ♪ come on in, we're open. ♪ all we do is hand you the bag. simple. done. we adapt and we change. you know, you just figure it out. we've just been finding a way to keep on pushing. ♪

welcome back let's catch you up on several other stories that should be on your radar today it is "rapid fire" and here to take on the headlines are michael santoli, kate rogers and eric chemi great to have you all here some employees were told they should return to the office. what do you think of this, michael? >> it's not a surprise they want to get the process moving.

it's not like they'll pack the trading floors these are two senior executives in those areas, sales and trading in particular being areas where there does seem to be a lot of advantage of being up close you're constantly messing with clients, you have all this data rich technology there. so it makes sense. i don't know if this necessarily, though, creates this kind of automatic me, too move with other offices. it's right now pretty well restricted to the big banks and trading. >> others like abvi said they wanted to bring people back who are a little more hesitant, so we're starting to see this standoff, but maybe for the first time, it's after labor day, and companies and workers are now figuring out, do i really want to go back, do i have to go back, and what's that going to look like >> i know somebody who works for jp morgan who said, yeah, i'm affected by this, i don't want to go back in, i have kids so for jp morgan is more like,

if you have kids, you don't have to come back single employees, do you have to go back? if you live in the suburbs with a wife and kids, does that affect it? we all have been working from home for the last few months at these companies, but we knew everybody from being in the office you can't hire new people who have never met anybody, put them at home and expect them to figure out what goes on at these companies. >> i agree, it's so tricky traffic is picking up. that's my indicator. people are definitely being pulled back in whether they like it or not. let's talk about peloton, those shares turning lower today, lower despite crushing earnings the store saw 172% over last year in sales as more people worked out at home and ordered their bikes. for the first time ever, the shares have tripled in the past six months maybe no surprise. this was a high bar to meet and peloton is down almost 3% now.

>> yeah, definitely, kelly, and they also gave guidance, chaiyasombat real rarity these days and just seem really positive about the future. i noted how often their users were working out i think they said just under 25 times a month. >> that's crazy. >> exercising and quarantine, i can speak for myself they also mentioned, too, the success of their clothing and that kind of flying off the shelves which is interesting because so many retailers are struggling i think some of the lower price point items they have coming out like the bike and the treadmill will probably be popular because, again, this is an expensive product. it's not necessarily for everyone but i think it will be a long time before people truly feel comfortable going back to the gym and being crowded around other people, and working out at home is likely a trend to stay for a little while >> michael santoli, what do you tell the peloton owners who are really pumped up right now >> just be careful

right now they've clearly had an accelerated path toward acquiring all these customers. also built into the stock is that effectively it's a quasi-addictive service. once you own it the frequency of use would indicate that. but what does that tell you about the total size of the market for likely customers who are going to be candidates to get into that mode you have to be careful in both directions >> 25 times a month, i think that's crazy, but that's just me speaking of exercise, the 2020 nfl season kicked off last night with defending champs cans city chiefs beating the houston texans 34-20 while the broadcast appeared fairly normal, quote, unquote, eric, this is not going to be anything like the normal nfl season what are your takeaways from last night's action so far >> they are one of five out of ten stadiums opening to a

limited number of fans having no fans is weird, the normalcy makes it weird. you'll see fans getting in there digitally like we see with the nba right now. you'll see cardboard cutouts like we do with baseball the crowds in the stadium, the players will hear that on the field, so the broadcasters may add their own noise we may only hear on tv, but this will be a week-by-week experiment to see what works with audio, they had been recording audio on nfl films that had been for different projects over the years, so they have it for the stadium. >> i love how each stadium has to have their own authentic sound, and we're all getting used to this there is a lot of money riding on this, eric, but it's just too soon to know it's been one game this season the whole thing will depend on

how many people come back to watch. maybe it's more, maybe it's less and what football looks like beyond this. >> think about it, you don't have the nba and the nhl playing this late in the year. you do have that with the nfl. people maybe have to go back to work, watching their kids. it's not clear how many people will be watching the nfl that's the big question. i wouldn't count on weekly ratings. let's see where we are two, three months into the season >> if you're watching at home, you have to order pizza. domino's cited its long-term playbook getting through the pandemic, saying it could help the company to continue to execute the shares, kate already 30% up on the year, they are lagging behind papa john's and chipotle obviously, this is the most successful part of the

restaurants right now. >> you had them set up to be successful during covid. particularly domino's. they were working on contactless delivery before it was even a thing. they just added -- these are controversial, i know -- chicken taco pizza, cheeseburger pizza, but papa john's is doing a lot of innovation, too they're focusing on value and innovation and just easier access domino's has about 23 million loyalty members. that's the highest membership rate i know of among these big restaurant players, and 75% coming in digitally. >> 75% is an unbelievable number i used to chuckle when domino's said they were a technology company, but they got the last laugh more than anybody else this year. finally, the ceo of whole foods making a bold prediction on shopping.

he says he doesn't think people will shop in person anymore after the covid ends huge difficult cal sales at kroger of 120% mike, do you think that's true obviously grocery delivery is easier than ever, but do you really think grocery stores are going away somebody has to be in these strip malls. >> i think most will not exclusively shop in these stores are a stretch. obviously many people who got in the habit of having standing orders and they know what they want and it gets delivered, truly that's a growth area for a long time to come. but there is an impulse buy aspect to it, there is a serendipity to it, there is a let me get out and figure out what i need to do element to it. i think you'll have those people who say, let my app do it for me and i just want to get out in the world. >> kate, where do you fall >> i was saying before this segment i love going grocery

shopping i find it to be really relaxing. i'm not really a good cook so i need to figure it out when i'm in the store, but i'm one of those people who will definitely be going i've never placed a digital grocery order, but i will say when you're in whole foods you see a ton of amazon prime delivery workers that are filling orders for other people. that has gone through the roof the past few months just with covid. i mask up, i'm safe, wipe everything down, but i still go to the grocery store >> i don't enjoy it, but eric, i find that delivery is not a panacea, either. if they don't have the ground turkey you wanted, then you don't need the other eight items predicated on that, and there's delays i don't know if that can really be the future. >> if you need milk or butter or eggs right now, you're not putting in an online order and waiting for hours or days, you're just going to go pick it up it also depends on the size of the order, what's needed, what's urgent i think these online orders are more for, okay, this is my regular set of things, my staples i get week in, week out.

guys, thank you all today, appreciate it. mike santoli, eric chemi and kate rogers for "rapid fire. john mackey will be on "power lunch" next week so we'll get a chance to ask him about all of this. kate, what's going on? >> president trump made a surprising announcement from the oval office of a peace agreement between bahrain and israel following the agreement between israel and the arab emirates trump said all three of those countries will be on hand at the white house to us to sign these peace accords and he expects peace to spread across the middle east and says he sees very positive things potentially happening with iran and the palestinians, so trying to point to some positive geopolitical developments after a difficult week at home >> that has to be one of the few bright spots this whole year

kayla, thank you very much jp morgan making a move that betting on companies before they asr.ublic will be even eie we have the exclusive cnbc details on this next stay with us how we come up with new ways to serve our customers... and deliver our products. but no matter how things change, one thing never will... you can rely on the people and the network of at&t... to help keep your business connected.

welcome back jp morgan is making a move for demand for private companies they're creating a new team to trade shares for pre-ipo giants including spacex, robin hood and airbnb >> the story for the past 10 to 15 years is companies have been enabled to stay private for longer and longer. what happens is they get really big, they get huge, spacex is worth more than 30 billion what happens is the concern is when somebody goes public, all the juice has already been

squeezed for private d.c. investors. in this case hedge funds owners have approached jp morgan saying, can we get this hedge stock before they go ipo we want some action as well. >> this sounds like an almost new asset class in the sense that -- especially as you mentioned, if you've got pension funds and hedge funds and those kinds of vin toinvestors that ti they can get in sooner, that's one way of generating those returns. i guess j.p. morgp morgan, it's to them to prove that will be true in the long run >> right this is anybody's guess as to how true that is i would agree with you, kelly, this is maybe not new but a best of your knowledge -- burgeoning asset class in that there is not as much liquidity with this. they take weeks to set off, and

they are very boisterous trading things this is finally the time when a big wall street firm like jp morgan has decided to file into this and perhaps make more liquidity and make it a more mainstream thing >> right, which would likely make more potential returns. the more price discovery there is and the more participants to make a market, you would think the more rational that pricing would be and maybe not catching as many gains in this part of the market where that transition to going public, people have seen their 40 to 50% value go up in smoke >> that's possible, right? this is a game of constantly pushing out the horizon and others rushing in to try to get in earlier as you say, the games could go viral, right but this could be something that has a competitive advantage.

the managing director i spoke to said basically the higher the nasdaq goes, the more or less people want to get in it coming up, a record number of homeowners are leaving money on the table by not refinancing right now. we'll have the latest figures and what it says about housing and the consumer overall stay with us

welcome back with the 30 year mortgage rate dropping to 2.86%.

another record, 19.3 million borrowers qualify for a refinancing. some of them could save $500 a month. joining me are diana along with andy wallen. welcome to you both. andy, you've got figures how many people are eligible for what here? >> we're talking 1 million homeowners that could save three quarters of a percent to refinance. it becomes more interesting when you remove those high credit quality standards. you're talking 32 million homeowners that have a current interest rate 3 quarters of a percent. >> we're talking about savings in hundreds of dollars a month why are we talking about refi candidates instead of boom >> we're already in a refi boom. we have been in this over year now.

they are now up about 40% year over year because so many people have already refinanced and because rate vs been hovering near these record lows for so long we've had plenty of refinancing over last year ploo believe it or not, there are still people who can benefit >> this is a huge number same question to you what would it take for more people to enter the refinancing process now? is the idea rates might be going lower holding them back or is it something else it's already locked in rate to refinance. we stand here at tend of q3. it's still record levels of refinance incentury tifsecentive they are still showing potential to climb even higher >> andy, a momentum ago diana mentioned credit worthiness and that being a hurdle in some cases.

how much of a head wind is that for going through the process. is there anything on the bank side that would make this unappetizing to people or unavailable? >> those numbers are the head winds are baked into that 19 million number that we looked at we're looking at folks still remains current on their mortgage through the pandemic that still have 720 plus credit scores you're see record levels of refinance incentive. there's still a head wind. you're looking at 3.7 million homes that aren't able to refinance and take advantage of the rates that are in forbearance. >> a lot of people are afraid to make a move. they are worried about how would they close on the loan even though a lot of people are doing it in their backyards. i did it any my backyard some people are doing it on the hood of their car in the driveway they are concerned what it means if the process will take a long time if they will have to be

somewhere in person, sign documents with somebody el there. they also just incredibly conservative it's amazing we are seeing with home prices as high as they are, $6.5 trillion, that's a record amount of home equity that americans are sitting on that they have in their houses. we're seeing cash out refinancing very low people are not taking money out of their home. they are just sitting on the cash i'm not saying everybody should treat that i can home like an atm ten years ago. it's there you can add to the value of your home with it you can pay off other debt with it very few people are doing that >> i'll give you a quick last word on that and also kind of curious how these dynamics with super low interest rates are affecting the whole housing market now they were much higher than would have expected. are ke seeing a sharp move higher >> we really are it's been surprising to watch.

i think it's expected when interest rays fall and buying power is it a 3.5 year high now. when you look at the purchase lending numbers coming out of the market now, we saw about an 8% year over year dip in q2. the number could press 30 to 40% higher than q3 really all in for the pandemic we're net positive in terms of the total number of purchase loans originated somebody nobody expected to take place three or four months ago a lot quicker rebound in the purchase lending market and the housing market than a lot of folks expected >> up against low inventory. take a look at tesla shares which are selling off about 1% right now. they have been swerving in and out of negative territory all morning. ubs doubling its price target to $325 they expect tesla to quadruple

the number of cars sold by 2025. they say battery day could enable technology. they argue tesla needs more than that to energize shares. the stock is trading above ubs new price target apple will issue new rules for the app store that directly impacted game streaming services those shares did not react positively all three stocks falling on the news you saw apple down 2.5%. microsoft down 1.6%. the game makers also trading near session lows. that does it for us here on the exchange don't go anywhere.

the auto sector has been hit hard by the pandemic and the road to recovery will be long. we'll look at the risks ahead and whether the boom in electric at o can recharge things th'sn "power lunch "see you after this break. what if you could have the perspective to see more? at morgan stanley, a global collective of thought leaders

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good afternoon welcome to "power lunch. glad you could join us on a friday afternoon stocks giving up an early rally. all the major averages in the red even if just by a smidge for the dow industrials. nasdaq leading the declines down more than a percent. the dow and s&p now on track for their worst week since june. the nasdaq, its worst since march. retail wreckag