good afternoon, everyone welcome to "power lunch. along with kelley evans, i'm tyler mathisen it is stimulus whiplash. first, stocks are mixed as we await the release of the federal reserve's aptly named beige book for a closer look at the economic recovery, steve liesman will stand by to dig through the big headlines and bring us up to

date on where the various districts of the federal reserve think the economy stands right now. plus, jpmorgan taking on square and paypal with a big move into the small business space could the banks up-end the market and these high-flying stocks later, gm doubling down on its autonomous ride-sharing business the ceo of cruise will be here to explain why he thinks ride-sharing will thrive again after the pandemic "power lunch" starts right now hi, everybody. let's go to dominic chu with big movers. >> i have taken over tyler's spot at the telustrator. i will show you because tyler told us about the whiplash we've seen on the headlines. the markets are largely pricing in a lot of nothing right now. we were marginally lower,

marginally higher at one point, and now we're mixed across the board. dow industrials off 30 points. the s&p 500 up 0.1 of 1% or four handles and nasdaq composite outperforming, up 13 basis points to be specific there. 3446 the last level for the s&p 500. if you take a look at some of the big story lines we are following so for today, check out what's happening now with netflix shares one of the biggest losses we've seen that stock in a while. down about 7%. netflix coming off an earnings report that was disappointing for many investors out there, some of the subscriber growth numbers perhaps lagging expectations those shares, we've seen a nice rollover here. we'll see if that can find some kind of abatement with the netflix down moves on the flip side, a social media name not nearly as big as netflix but a eye-catching move, snap, the parent company of snapchat, up near the highs of the day, 31% to the upside

much better than expected earnings report from snapchat showing better user growth trends, better advertising trends all those things taking snap to the upside all of a sudden you have many internet names, tyler, a lot in focus, the big cap names and snap and netflix back over to you >> thank you very much, dom. let's get to steve liesman for the details from the fed's beige book out at the top of the hour. hi, steve. >> economic activity, the beige book says to increase across all districts. that's good. it says the pace was characterized as slight to modest in most districts there was a lot of variability out there across industries. manufacturing generally increased at a modest pace residential housing had steady demand commercial real estate conditions continue to deteriorate in many districts. auto sales were good there was a leveling off this is fairly good news in context, i suppose leveling off retail sales of a slight uptick in tourism

activity on the employment front, employment it said increased in almost all districts growth remains slow. it did say that firms continue to report new furloughs and layoffs. and this is something we talked about last month labor markets are tight and it's partially attributed to quoshgers' health and child care concerns that's been a big issue. we talked about the decline of prime age working women. on prices, they rose modestly. some sectors it, like construction, manufacturing, retail, wholesale, they passed along higher costs to consumers. this is finally an interesting comment. multiple districts reported continue additional cost because of covid-19, ppp, sanitation, testing and technology lead for remote working those are the highlights i'll dig back in and see if there's anything else worth talking about. >> thank you basically a middling report from

the federal reserve. as we react to that with lindsey, chief economist with stiefel and steve hartman with wells fargo asset management it sounds like things are moving forward, at least not backward, in most segments -- sections of the country, but at a more modest pace. >> exactly it seems like we're walking this fine line, which is what we've heard from fed officials, acknowledging the improvement we've seen from those low, low levels in the second quarter, much of which can be attributed to fed policy and still highlighting the lingering weakness we're seeing across a number of sectors, highlighting the uncertainty and risk we will face going into the end of the year and longer term into the outlook and beyond it's a very muted, modest ballot there's still a lot of ground to regain >> kirk, do you see any possibility that the economy could flatten out and turn

negative over the next few months we had an event yesterday with mario gabelli, who's a brilliant investor he thinks 2021 is going to be a very good year economically. do you >> i think 2021, and the markets are discountth counting is going to be a very good year what could trip up the market near term is a lack of clarity on the election. so, a lot of variables hanging out there and the election clearly is a wild card, but, at the market levels we're at, clearly 2021 looks to be a pretty good year. >> the market seems to be presuming, kirk, there will be a vaccine that will be effective, that will be widely distributed within the next few months or by middle 2021. that seems to be, to me, underpinning an awful lot of the market optimism to the extent we have it. >> oh, very much so. if you look at all the previous

beige books, what they hinted at is employment, and recovery in employment is very much a function of vaccine. to your point, the markets are very dependent on a vaccine. and what i'm concerned about is i think the vaccine will take a bit longer to roll out than we expect also my expectation is for a difficult winter, especially in the colder climate a lot of wild cards out there. at the end of the day, i think 2021 will be pretty good. >> i heard last night, to your point, the largest rate of case increase is in the state of north dakota, where cold weather has obviously probably already arrived. lindsey, let's talk a little bit about small businesses and how they are doing and how they may likely do as we move into 2021 my concern is an awful lot of

large stores were kind of reguarded as essential businesses and allowed to stay open and they have the capital behind them to be able to survive tough times. but that smaller retail businesses, the boutiques, the nail shops, the tattoo, all of those places are going to have a heck much a lot harder time and we may see a lot of business failure, a lot of unemployment that traces back there and then a lot of pain in the real estate world where buildings are going to go empty for a long period of time and landlords are going to have to find a way to work with their lenders. >> i think you're right. small businesses have been hit particularly hard during this pandemic if we look at u.s. chamber data, about a quarter of small businesses have already closed their doors, at least temporarily, since the onset of the pandemic and nearly two-thirds are worried they will be forced to close their doors permanently by

the end of the year. so, we're talking thousands of restaurants, thousands of boutiques and shops, nightclubs, bars, that are already closed and that more face permanent closure and are no longer going to be employing american -- when we look at how businesses have been able to bridge that gap, at least temporarily at the onset of the pandemic, many are now saying, well, because the timeline has been extended so precipitously, they do face permanent closures, additional barriers, additional restrictions and additional costs to keeping that business going. >> kirk hartman, lindsey, thank you very much. we appreciate it. we're going to turn back now to steve liesman, who has a little more from the beige book. some more nuggets, mr. leaseman. >> yeah, just a little bit about restaurants which was apropos about what you were talking about, saying restaurants have trouble staying open they're having problems sourcing winterized tents and propane

heating, which there's a premium on and some restaurants are closing early because of the cold, places like north dakota and, perhaps, new england, already settling in. just very quickly, tyler and kelley, the fed governor this morning saying she was increasingly concerned about possible recessionary trends becoming entrenched in the economy for a lack of stimulus she made a very strong case today, at least in her opinion, as to why this economy for a lot of the reasons you were just talking about, why they need stimulus kelly? >> yeah, we were just talking about the shortage of propane heaters as well. my family up in new hampshire lost power because the snow was so bad no wonder there's a mad dash steve liesman with more beige book highlights for us let's get to the bond market where the yield is hanging above 6.8% rick santelli here to talk about the moves. >> the beige book did not move rates much, as you look at those

charts 14 basis points for twos 160 for 30s. they haven't moved at all. dollar index really under the pressure here, trading just above 92.50. that's really questionable considering how much rates have moved higher consider as a percentage they were at 50 basis points in 10s that not many weeks ago. to your question specifically, i hear all of this talk about when we get a vaccine, maybe middle of 2021. call me crazy, but i'm an optimist and i think the federal reserve ought to move more into the optimistic camp as well. because when there is a vaccine and we have all these refrigerated factories, they're really going to push this vaccine out when they get it my guess is the economy is going to have so much extra horsepower built in, that once we start firing, the demand is going to exceed supply and things are going to get a bit wild. if you're looking to see if we ever get back to 1% on a ten-year, my guess is it will happen five minutes after that

vaccine is approved. back to you. >> very, very interesting. of course, that is what we're talking about, what 2021 is going to look like when a vaccine comes and some of the pent-up demand there probably is in the economy as people get back to normal and start to feel safer. coming up, a wave of consolidation hitting asset management market as more and more money shifts away from mutual funds and etfs and where the bigger get bigger and the smaller fight to survive the ceo of temple ton will join us to talk about how that company is fighting to keet their edge. plus, gm announcing its self-driving ride-sharing business is expanding, testing on the roads the ceo of cruise will join us to discuss why he thinks autonomous vehicle will dominate the fast lane in the next two years. more "power lunch" is next

covid-19 has crushed the ride-sharing industry as people don't want to get into a connected space with strangers but gm's autonomous ride-sharing unit, cruise, is pushing ahead let's go to phil lebeau for the details. >> a little bit of news from cruise today, and it basically comes down to this they have applied to the

national highway traffic administration they're basically modifying their previous application and it has to do with the origin vehicle. that vehicle is one that they debuted earlier this year. they unveiled and they'll be testing out in the san francisco area this is it you're basically looking at what is essentially a small shuttle they applied for approval for wide-scale development -- deployment, i should say, of the cruise the whole idea is it provides autonomous ride-sharing and at the same time, look at this, this is when they unveiled it back in february now we're going to show you some shots of the modifications they're making due to covid-19 they are going to be implementing pandemic protections. well, maybe a little hard to see there but we're talking about a shield going between the passengers there they'll be spacing out passengers, hand sanitizer, ensuring each of the vehicles is cleaned between rides. it's all their part of saying, it's safe to do ride-sharing let's bring in the ceo of

cruise the application you're putting into ntsa as well as the origin, it has some people saying, okay, this is a start, but i'm not sure ride-sharing is going to come back the way it was before. what's your outlook? >> well, i think the reality, phil, is during covid, all the trouble that we have had for years in transportation of, you know, too many accidents, too much pollution, too much congestion, you know, while -- while during covid, a lot of things are as bad or worse the fatality rates have gone up to a 15-year high over the last few months the big problem with transportation is real and we need to solve that and our solution is all electric it's shared and self-driven. those are the ways we think we can solve these problems most directly. >> how do you ensure to passengers that it will be safe? i will be honest with you, when i have talked with relatives or friends and said, hey, let's take a particular ride-share, i get this, i'm not really sure i want to get in that car or that

vehicle. how do you ensure that the origin will be safe? >> well, you've seen the things that we've put into the vehicle, the partitions, passengers are completely separated from each other, upgraded ventilation so that the air is turned over in the space more rapidly people will be required to wear masks, hand sanitizer, as you mentioned. so we've been working with a harvard epidemiologist to give us really, you know, robust advice on the best way to make the origin as safe as possible these are the measures we think should not only, you know, substantively improve safety, but also give passengers peace of mind that this is really a safe environment for them to share a ride >> dan, it's kelly here. and the aspect of this to me that's not as interesting as ride-share, it's more, correct me if i'm wrong, that this vehicle would have no steering wheel and no pedal i mean, i would imagine this is the first such vehicle that would be approved to be on the

roadways assure us it's all ready for prime time. >> as you might have seen last week, we received a permit from the california dmv to begin fully driverless testing in san francisco. and we'll be doing that in the coming months here you know, we've been working for years on improving our technology and getting to the point where it's safe enough to begin to remove the human backup driver from our avs. and as i said, we'll begin that testing here in the coming months after years of hard work, things are starting to get pretty exciting in the self-driving space. and you're seeing a number of these recent developments. we point to the fact that this really is going to be the future of trngs of transportation. >> dan, have you been in contact with executives or ceos, the airlines or hotels, other industries, that are really trying to face the same problem you'll face with the origin, which is convincing people, yeah, you're going to be interacting in an environment with other people, but it is

safe to do so? >> yeah, we've looked at a lot of different use cases and examples, phil the thing that's great about the other begin is it's a vehicle that's purpose built for this kind of use case and, you know, we're still obviously in the advanced stages of development with it it's the perfect time for us to demonstrate the flexibility of that platform to show that we can provide shared rides in a very, very safe way. that perhaps more conventional forms of transportation don't have the flexibility to do at this point in time >> dan, when do we see it out on the roads? >> we're moving as fast as we can, phil. the other begrigin is in very a stages of development. you'll see prototypes soon. >> this is a driverless vehicle with no steering wheel and no pedals, brakes or things like that how confident are you that it's actually going to work, in be one? number two, do you have any read

on whether -- on how frequently you have computer or other kinds of hiccups that would cause the car basically just to stop in other words, if i'm in a ride-sharing vehicle and something goes wrong and the system goes down, i'm ticked off. >> yeah, you most certainly are. that's something we're obviously keenly aware of. we have over 2 million miles of testing. mostly on the streets of san francisco. so, in a very complex urban environment. we're focused on all the aspects of the self-driving vehicle performance. obviously, how safely it drives is most critical how smoothly it drives how reliable and stable the system is. and when we're talking about system stability, which is what you're referring to, we are autos more stable than things like your laptop or phone. we have to clearly be able to deliver. >> how did you know i was having trouble with my laptop and computer today

dan, thank you very much we appreciate it phil lebeau, you, too. thanks, guys, to all we appreciate it all right. let's roll on, shall we? here we go still ahead, bitcoin hitting its highest level since june of 2019 after paypal says it's going to start supporting cryptocurrency payments how much will it move the needle for the stock? there you see paypal up almost 5% we'll have a top analyst weigh in. plus, shares of chipotle heating up, jumping 60% in 2020 as it gears up for earnings after the bell the traders will tell you what to expect. salsa? salsa. more "power lunch" is next this is decision tech.

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welcome back to "power lunch. chipotle shares not far off the record high as they gear up for earnings after the bell today. for what to watch in this report are, the trading nation team joining us todd gordon, michael from rockefeller capital management great to have you on chipotle had the foresight to invest in digital before the

pandemic i'm curious with all that good news is already priced into the stock. now up 54% year-to-date. >> yeah, look, the big question is, can they sustain this massive growth they were able to pivot really rapidly when this e-commerce pandemic hit and so they were able to scale their delivery business. they were able to nationally scale fresh, quality and consistent we asked ourselves,how did the do that? their employee loyalty program tripled over the last year to 15 million, which rivals massive companies like starbucks, et cetera they were also able to create a real loyal culture within their employee base. and employees are happy there. they've created a culture there where you can grow as an employee finally, they're able to sustain earnings growth. i think it may be reasonably valued at this point right here in the short term, but long term, there's a lot of room for them to grow, especially to where they're scaling, their

e-commerce and e-delivery business is rapidly growing. people know their product as quality and fresh. as we move into a world that's much more health conscious and much more fresh food conscious, they fit into that picture as i said, it's maybe reasonably valued now long term we're looking for this company to continue to rise and to continue to have tremendous earnings growth over the next 24 months >> and, todd, you've been dissecting the chart what do you see? >> yeah, i mean, this is -- this is a hedge fund favorite it's kind of reinvented itself after that 2016 eli scandal -- e. coli scandal, i should say. the chart is a powerful uptrend but if you use long scale, it's not yet overbought and wouldn't be considered so until it has a dose handle, a two handle. they brought in a new ceo in 2018 to recover from that scandal. under his efforts, they refocused their marketing to figure how to win that customer

loyalty back they've been focusing on the digital growth, creating the sticky customers plus they have a nice partnership with grubhub a couple of upgrades margins for tonight, they may be questionable given the impact of covid but they are transitory. how do you not like them they brought back carne asada so we're bullish. >> a lot of people like that menu change. thank you. cmg report after the bell. for more trading nation, head to our website or follow us on twitter. kelly, back to you >> thank you so much. still ahead on "power lunch," looking for the edge how firms are competing against etfs in this market. plus, billionaires against higher taxes a group of billionaires in illinois building support against a potential new tax hike and a battle brewing over main street how jpmorgan is looking to cash in on small business and the payment space. it's all coming up after this. and now the latest from

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. welcome back, everybody. i'm sue herera here's your cnbc news update new jersey's governor, phil murphy, interrupting a news conference to say he must leave to self-isolate after just hearing a member of his senior staff had just tested positive actually, that was the wrong video. we apologize for that. let's move on to western europe where spain has become the first western european country to report more than 1 million coronavirus cases. and officials report 17,000 new infections in the last 24 hours. some hospitals are reporting a chronic shortage of nurses and on a lighter note, one of the biggest dog shows in the entire country is moving

outdoors why don't you just come back to me on camera because that is not the westminster dog show, which is what i'm talking about. that would be a roomba anyway, the westminster dog show is moving from madison square garden to the lawns of the country estate just north of the city the date of the show also being moved because of the weather from february to june. all of those parading pooches and humans can stay warm. i think that was the news update for this hour i'm going to send it back to you, kelly >> oh, my goodness >> we have a lot - >> you can get the roomba with the dogs and - >> we could. we're cleaning up after the dogs >> you know, if you're in a dog show and all you've got is a roomba, it ain't going to do the trick, man. >> that is so true. >> you need something a little more - >> i think it's something to do with westminster footage anyway because the last time i did the westminster dog show, they showed westminster abbey

i'm just not -- i'm not doing this story anymore here we go here we go >> that's a nice little whatever it is. >> parading pooch. >> there we go followed by a roomabout. a. >> yes closely followed by a roomba >> we're told we must leave. kelly, get us out of this. >> sue herera with the cnbc news update. here's a look at markets right now. dow is up 40 points. s&p up 12. nasdaq up 40 that makes it the outperformer today. the small caps are lagging. market moves we've seen all day driven by. the stimulus talks some optimistic, some not so much senate vote just went down, literally. here's the latest. >> the treasury secretary and house speaker nancy pelosi are scheduled to start speaking over the phone right now. earlier today she had said there is the prospect of an agreement, but they're still working through a number of issues, including state and local

funding, liability protections, and other appropriations as for the potential for a prospect of an agreement that could actually pass the senate, that's a little more murky republicans just failed to advance their own $500 billion targeted package of coronavirus relief now, as to whether republicans might support whatever the white house negotiates instead, chief of staff mark meadows dodged the question while on capitol hill this afternoon >> i'm more working with speaker pelosi right now, trying to get her to be reasonable once we get a deal there, hopefully we'll be able to discuss the merits with our senate colleagues. >> kelly, we will see how long this conversation between mnuchin and pelosi last and how much progress they can actually make back to you guys >> all right, ylan, we appreciate it. let's turn to the oil market closing up the day, energy one of the worst sectors again

dom chu has the latest. >> the equity markets may be more mixed but it's significant, down for the oil markets wti and west texas intermediate crude futures, 4% downside world benchmark, brent crude, 3% downside those stimulus stalemates are considering some of those concerns traders have given the rise of covid cases, given the fact we don't have a stimulus plan, but the supply issue may be the bigger story. the u.s. energy department said earlier today that weekly oil inventories it fell by 1 million barrels but gasoline stockpiles rose, which feeds the oversupply fear those oil markets reacting in kind they're down >> thank you very much. we're seeing a wave of deals on wall street in particular, in the asset management business as more money flows into low fee etfs and, indeed, mutual funds but etfs have been in the vanguard, so to speak. franklin templeton acquired

legge mason, and morgan stanley talks to buy eaton and jan anderson jenny johnson, ceo of franklin templeton, a new face to "power lunch. you and i had a wonderful conversation a couple weeks ago on a cnbc event panel. we talked largely about ders withty and workforce changes maybe we'll touch on those, but let's talk about consolidation you added legge m mason to finih your portfolio it wasn't the first acquisition franklin templeton has done. they came out of the merger of franklin and templeton do you think small shops are going to be able to compete in this era of lower fees and greater economies of scale >> yeah, what i'd say is we're

seeing much more of the long awaited, long predicted consolidation in the industry with big deals i can tell you, i am squarely focused on making sure that the integration of legg mason and franklin templeton works various people have different reasons for their deals. ours is our growth story it's about having an all-weather product lineup, it's about diversifying our client base, and frankly, at one point, $4 trillion, it gives us more to invest in technology, technology tools for our clients as well as data science and data analytics for our investment teams. >> i guess every -- it's the problem or the dilemma of every company in this space. i would guess that if you rn a smaller firm, you really have to stand for something to break through and be able to do it i'm thinking of a shop lika lik ariel or calvert what do you stand for at

franklin templeton >> i think you have to stand for excellence, in our case it's active management. we doubled down in active management we're big believers that the next decade isn't going to look like the past and that active management is going to thrive. and in -- you know, we have a number of different investment teams. they're very much independent. we can build that on a base of investment in technology, in risk management tools. so i think it's standing by excellence >> so, make the case for active management because an awful lot of people, and some of the results, many of the results over time, indicate that passive management over a long period of time outperforms the active managers why do you it think -- why are you doubling down on active managers and why do you think now is a time where active may be able to show greater value? >> yeah, look, we're coming off a decade of unprecedented government liquidity pumping into the economy globally.

and at zero or negative interest rates. where do you put your money? you put it in the equity markets. you saw very little differentiation in performance and active managers thrive on volatility we thrive on dislocation you saw active management outperform in march when the market tanked with the lockdowns and covid. you think about the next decade. there's no way that you're going to be able to continue that same kind of stimulus frankly, it's going to be a decade of digesting what has happened in this past decade we think that's going to be where active management is going to really be able to perform. >> do you think those -- the knock on active management, and i don't mean to sound like a hair shirt here, but the knock on it has been that while they can outperform over certain periods of time, the ability of an individual manager or team to do that over and over and over again long term is really minimized. >> yeah. again, i think that you have periods like this past decade

that people become complacent and understanding where active management is so important you know, you look -- i describe the analogy of saying, if you're driving a car down a straight and well-paved road, you don't need a lot of the safety features but if you're going to head to the mountains and have a snowstorm, you're going to wish you had those safety features. that's what active management is it's risk-adjusted returns it's setting yourself up for the unexpected and making sure you have that diverse porfolio again, taking advantage of those opportunities when they exist. people are talking about a "k" recovery right now that means that some sectors are very much going to outperform and some are going to underperform it's the active manager that can select which one is going to be the outperformer >> jenny, it's great to see you. we'll continue this conversation soon again in the future i have to point out that you have one of my son's 529 plans i've got my eyes on you guys >> all right

>> thanks a lot. jenny johnson of franklin templeton. >> don't mess it up. coming up on power movers, two at-home stocks moving in different directions plus a congressman playing video games on twitch. and a lot of people tcd.wahe it's all coming up on "power lunch. or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity. iphone 12 and iphone 12 pro are here on verizon 5g. whoo! this new iphone, plus verizon 5g... game changer. (announcer) with the coverage of 5g nationwide, and, in more and more cities, the performance of 5g ultra wideband, the fastest 5g in the world. whoa. i downloaded a whole movie in under 30 seconds. how is that possible? (announcer) pre-order today, and when you switch, get iphone 12 on us. i want this phone. (announcer) this is the 5g phone everyone wants on the 5g america's been waiting for. only on verizon.

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to him for today's power movers starting with wd-40 who dent love a little wd-40 in their lives? the stock rising after beating on earnings and demand isolation renovation there you go. up next, irobot on pace for its biggest drop in a year despite beating on earnings and saying its forward guidance would exceed original targets. even with today's big drop, the stock is still up more than 150% from its march low and the company's ceo is coming up soon on "the closing bell," you'll see the head of irobot. we end with a check of the marijuana stocks today building on recent gains as the biden/harris ticket is seen as more friendly to cannabis. >> irobot, maybe that's why they

are the roomba footage handy. from twitch last night, more than 400,000 people watched aoc, alexandria ocasio-cortez live stream playing video games it was the third most watched live stream in history number one is when drake played fortnite among us is played by a group, they try to kill crew members on a ship it's very popular right now. by the way, lots of people pointsing out, you know, you get 400,000 people watching even regular tv these days, that's a pretty big deal. it shows the power these new platforms have. >> whoa. my son has not found that one yet, but maybe he will find that game i don't know he's more right now into w2k -- the nba, the basketball game, whatever it is we shall see billionaires, they've become something of a punching bag in

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billionaires in illinois are teaming up to try to stop increased state taxes on the wealthy. that's not surprising. what is surprising is that it seems to be working. robert frank has more. robert? has more robert >> hey, tyler. illinois voters head to the polls in november to vote on a ballot measure that would allow for higher taxes on the wealthy, but it faces long odds right now, in part because of a campaign from the billionaires who are opposing it. the measure would replace the state's flat tax with a graduated tax, allowing higher taxes on the higher earners. billionaire governor jp pritzker is spending $56 million of his own money to support this change on the other side kevin g richlt ffen is spending $20 million of his own money to oppose the

measure. so far their efforts appear to be working recent poll shows this is falling well below the 60% of votes cast it will need to pass and go through opponents argue this tax hike will hurt jobs without facing the state's runaway spending pritzker's group saying, quote, opponents are receiving millions of dollars from billionaires who don't want to pay their fair share in taxes, and that's allowed them to get their measure out. kelly, back to you. >> robert, speaking of tax rates, we want to talk about this story that's gone viral combined federal and local tax rate rates could be under a biden administration 60% or more in places like new york city, fi'ty cent said he's voting for trump because of it on the new york post saying i don't want to be 20 cent. >> it's interesting. i got an email saying 50 cent is

a fan. i had no idea what they were talking about. our job is to tell people what this election means for their pocketbooks. in california and new york city, they would be around 62% we should add in this whole debate here that the effective rates, that's what people would actually pay in many cases, would be closer to 53%, but again that everyone's tax rate is going to be different all we have to work on is the concrete top marginal rates. the reason this got so much attention is that we've all heard about all these plans, but it doesn't mean anything until you boil it down to one number what would it mean for me if i live in any of these places? that 62% seemed to hit a nerve it's just math it's not politics. >> it's the highest marginal rate that applies to the last dollars earned or those above the lower bracket rate my son told me about this. >> correct. >> about 50 cent's tweet or instagram post i said we should repost it he said you might want to think

twice about that, because there were not just 50 cent words in there. there were some more expensive ones as well. >> yes yes. expensive for broadcasting. >> expensive for broadcasts. >> he did mention also that he goes, oh, i just remembered i'm bankrupt and this won't apply to me who wants to give me a loan? then said he was leaving new york because the knicks are terrible, too. he threw a lot in there. >> he's got that right. >> robert, thank you so much robert frank reporting for us. >> thanks, guys. bitcoin at its highest level. crypto curreies ncare getting more main street support ♪ ♪

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welcome back there is a battle brewing with jp morguen as square is dominating the payment space shares rup nearly 200% just this year how much business could the big bank take back an analyst with nizumo good to have you here. >> thank you. >> not much reaction by square today, but this would seem like a big, potential competitive threat. >> yeah. i think actually the opposite. i actually view this as more of a defensive thing by jp morgan versus offensive the reason for that is because square, if you remember, square is basically a story of two ecosystems

one is what jp morgan is going after but the other is cash app system, the ultimate neo bank. what's happening is square is seeing the average revenue per users for the banks being $300 to $500 versus its own average price per user of $35 and they're saying we have to be defensive and go after square's business because we think our core consumer banking will be threatened. >> i take your point, and square shares are down 3.5% today it's not just that their investors are totally shrugging this off can scaquare count on the cash f if small businesses are peeling away to use the chase technology instead? >> yeah, absolutely. i actually don't think a lot of the threat is to square specifically there's a lot of other players in the industry that have

inferior technology. threat is bigger to them than it is to square itself. i don't think that the overall -- people like to associate jp morgan or chase announcement with square but i think the point of sale system square is less threatened. from the cash-out perspective, the squie is the limit think about the average user going up and up and up over time that's sort of the engine of growth or revenue for square if there's a little bit of a threat from jp morgan side, it is not going to be felt very much overall in the bigger picture. >> you're saying that this chase move maybe threatens companies like verifone? what's wha about this announcement by paypal saying they'll accept crypto currency shares of the bitcoin are rallying in response but what could this do for them >> welcome to the club

square has been offering crypto currency trading for over two years now. it's been a big success. they're not using it to make money. they're not making any real profit off of it it's a very good positive for paypal it's a welcome to the club and they understanding that the 120 or so million users of venmo and paypal, you can do a lot more things with them. crypto is doing buy now, pay later. basically they're getting into banking as a service but after square square is sort of the thought leader there, and they're doing i want to be there as well this is great and could be very successful. >> sticking with paypal and square, thank you for your time today. we appreciate it. >> thank you. >> ty? >> kelly, how often do you use your phone at checkout, as a checkout device? >> all the time, if i can. i'm getting to the point that the only reason i take my wallet

with me is if i have to have my driver's license. >> enough of the vendors you go to have the terminal to do it? >> i'm not going any place these days, only the grocery store. >> kelly, thank you very much. see you tomorrow, folks. thanks for watching. don't take your eyes off that screen "closing bell" starts right now. >> ty and kelly, thank you very much i'm wilfred frost. investors await updates on that back and forth stimulus negotiation. major averages are picking up steam as we head into the final hour of trade. driving the action, higher start to the session turned south around midday. encouraging comments from house speaker pelosi about stim talks sent stocks back into the green. more in just a moment. divergence in snap exploding on the back of