"working lunch." andy jassey will tell us something few others know about his early relationship with jeff bezos. hi, everybody. let's get you a quick midday market check the dow is down 218 points, the s&p down 15, the nasdaq dropping only 18 points at the moment let's take a quick look at bitcoin. back above about the 46,000 mark 46,748 back in the world of stocks, moderna is seeing a 3% jump today. it's up 315% this year also we'll check on shares of apple as this event continues. they have been bouncing around session lows as you can see there. again, session lows, let's keep this in context, down about two-thirds of 1% we're about an hour into the launch of what has been the iphone 13, some watch updates,

ipad mini among other things >> let's get to the new iphone the iphone 13 under the hood a new chip, the a-15 bionic. so this phone should feel faster, apple says, more advanced display, about 30% brighter, more power efficient, longer battery life, upgraded camera and video system. the best 5g experience for users, apple says. they'll expand 5g support to 60 countries. the iphone 13 mini still starts at $699. the regular iphone 13 at $799. devices now start with 128 gigabytes of storage space meanwhile let's get to the ipad. that has been a winner for apple as so many of us are working, learning, playing from home so apple wants to keep that going they announced a new entry level ipad simply called ipad. faster processor, upgraded camera system, all day battery life

$329 is the starting price, $299 for schools. that can be ordered today, available next week. apple promises a big jump in performance for the mini new increased screen size. 5g enabled that starts at $499 order today, available next week finally apple watch. the watch series 7 is announced. that is the largest display yet for their watch. 20% more screen area, thinner borders, the most durable watch yet. charges 33% faster $390 and available later this fall back to you all. >> josh, thank you very much very full and complete coverage there. let's get to our panel for more reaction on what we've heard so far and the impact on apple's stock which is lower right now ed lee is a corporate media reporter for "the new york times" as well as a cnbc contributor and tom forte is managing director and senior research analyst at d.a.

davidson ed, nobody does it better than apple in terms of product announcement, creating anticipation, creating excitement does this one live up to the hype >> you know what, i think this was one of the more subdued apple events that i've seen in a while actually look, it's very well presented, very well marketed they're still the masters at it. but i think it's a lot of geeking out frankly. the new phone, yes, it looks kind of the same but it's faster, brighter, they really geeked out on all the stats there. so for the hard core users, absolutely they'll eat this up for everyday people like you and me, it looks the same, right so in that sense i'm still trying to pay attention to see exactly where the big differences are. better camera, yes, all that good stuff but it feels more subdued than i've seen in the past. >> it does sort of feel that

way, tom forte, a little bit in other words the camera is better the camera was pretty damn good to begin with. 5g, yeah, that's better than 4g if you can get 5g service wherever you happen to be. our producer sent along a chart that showed how apple stock performs immediately after iphone announcements i was surprised that over the years it hasn't performed really, really spectacularly well in the short term or the medium term of three months or so what should we expect this time? >> sure. i think, tyler, the reason that happens is the stock tends to run into the announcement and then they have the new product and the stock doesn't do very well then they report the first quarter with the sales appeared it gets a bump once again. so it's similar to last year

the real star of the show is the 5g network i don't think they need to have anything spectacular in the iphone 13. it's giving consumers a 5g device as they build out the network. i think it will be strong sales for apple. >> the 5g network. let's talk about that because i have a phone that operates on 5g but very rarely am i able too connect with 5g so i could not tell you at all what 5g means to me right now it's pretty much nothing, tom. >> what it means to you now, tyler, is a faster processor probably when you're on your home wi-fi open fully you appreciate that element. what it also means is this is a multi-year event you're looking on excellent points where it's going to take a while for the 5g network to build out, especially on a global scale and especially in the u.s. so that means many years of

iphone unit growth. >> ed, back to you that is a great phrase that it seems like apple is geeking out on technical specifications. we've got these products now and they do pretty much everything i want them to do, and we're sort of in that world of where differences are not necessarily noticeable to the basic end user or consumer. the camera may be better, yes, the processor may be better, but i'm going at increments of change that i don't even notice sometimes. >> and you talked about 5g and how it's something that you have and you can't really apply it. >> i can't experience it. >> so we're in this situation now where apple is doing a good job of trying to stay at the cutting edge or at least keeping up with samsung in terms of the technical specifications but what they're doing is 5g is

a technology still in search of an app, a killer application we're talking about automated cars or whatever it might be faster when i'm out on the run, yes, it's better but i don't notice it that much. it was already fast as you pointed out. so the full capabilities haven't been tapped into it comes down to developers and applications and we don't know what that looks like so until that happens, until that killer app really exists, 5g is just another marketing slogan for most users it's sort of like, okay, it's better, i guess. so that's the missing piece in all of this. >> i get -- you know, i don't mean to rain on apple's parade, truly i don't because i admire their products and admire their prowess and hutzpah. let's turn to the ipad and to the watch. i was struck here, tom, at the growth in ipad sales, up 40% over the past year i suppose that is in part

pandemic related >> it's hugely in part because of the pandemic. so when you think about remote work and you think about remote learning, what better device to do it on than an apple tablet. that's why i think it's very good they decided to launch a new ipad mini to complement their new ipad so that 40% sales growth give or take in tablets is because we're all working remotely and learning remotely and having not just a new ipad but a new ipad mini to continue that momentum i think that's great news for apple. >> tom, just backing up for a second so they launched the iphone 13, the iphone 13 mini and now the iphone 13 pro, correct >> yes. >> so what do you make of the a-15 chip? >> yes >> what do you make of the powerhouse that they claim isn't probably one of the most important aspects their continued innovation in chip

technology, whether it was the m-1 chip or what they're doing on this front? >> the big news for the last 12 to 18 months has been integrating their own chip rather than relying on intel and others to do so. it is faster and more powerful so to the extent that you have consumers who maybe are less interested in the new network and things of that nature, they will appreciate the faster speed of the apple devices powered by apple's own chips. >> let's turn back to this iphone pro, which was the third in line here i assume it is, ed, the highest end, or tom, for you we have some video of it i don't know that it will look -- well, look at that super retina xmr look at all of that. >> tyler, i think this is apple's metaverse. the way they have announced these products itself might be one of the most striking and memorable things of this particular event. >> starts at 799, which is

apparently what one of the other iphones has been announced, 13, also at 799 but i assume that's base levels of storage the more storage you get if you get 512 storage it goes up in price from there iphone pro, ed, bigger watch space. that sounds good, on iwatch. >> bigger, better. yeah i actually think for the iphones was well, the base storage is an improvement. >> up to 128 gigabytes. >> exactly that's the new -- exactly. that's an improvement from the previous base models they have that's good for the consumer looks like there's carrier discounts as well. that's also great for the consumer for the consumer it's going to come down to is it cheaper

how much more is it going to cost me? are they in the upgrade cycle right now and if their carrier is giving incentives, all the better so at the end of the day it's not so much about the better rhett in screen that's going to convince the consumer, it's apple, can i get it for the right price and that's the big driver coming to the next quarter if the iphone sales pick up the way they want to. >> and all of this said, apple shares are moving to session lows tom, is this a buy the dip opportunity? >> yes, i do think that's the case the good news for apple is the iphone is the most important product from a revenue and profitability standpoint and i think they'll leverage this 5g buildout which is good news for the stock. >> the stock is down about 1%, about $148 a share tom forte, ed lee, thank you both. >> thank you. coming up, the reddit crowd is moving stocks we'll dive into the names involved and who might be moving

next. plus is now the time to trim your exposure to the market? there's a whole lot more "power luh"henc aad

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today we have many targets i'll start with smile direct club shares climbed 16% yesterday down, granted, 2.68% right now and that's a lot of it has to do with profit taking but they make clear teeth aligners and has been around since the early 2000s. 33% of its float is shorted so that's over 34 million shares. that's a substantial amounting and the reddit crowd has noticed. it doesn't make the top 1,000 most shorted stocks according to s-3 partners but it's getting some love online daily mentions climbed over 1500%. it's the number three trending name today and that's attributed to the surge in trading volume for smile direct club. it was three times higher than the prior 30-day average but this is a company that is still unprofitable, struggled through disappointing earnings and currently trades near the lows on a positive note, the cash

burn is decreasing and revenue is growing for example, i know all of us, me especially, zoom calls make us notice our faces, our smiles. during lockdown smile direct club said demand for its teeth whitening products jumped 76%. sdc has sued universal media about reporting by nbc aside from the shorts there are no new catalysts but a mobilized body of retail investors can put these short sellers on the hot seat >> did i hear you, kristina, say this is a company still losing money? >> they have been around since 2004. >> have they -- >> the latest earnings report was in august and i don't know the exact numbers for you. >> has it ever made money? >> i would have to get back to you. >> we don't want another lawsuit against us. >> yeah, we don't want to speak out of turn. >> let's just stick to the teeth.

>> sdcr is down 2.5%. sticking with the meme theme, amc apes and gamestop traders are joining forces and moving the stock frank holland as the details frank. >> amc shares down today as well but closed 9% higher yesterday as the meme stock got a boost with the news more movies will go to theaters as well as a big uptick in movie attendance during covid many, many theaters were closed but still eye-popping numbers and a solid reason to invest in the stock. how do you explain the recent rise in gamestop both stocks are outperforming the market since add an aron ano announced a potential partnership between the two meme stocks this meme depicting the climax of fight club with amc and gamestop fanatics. plenty more tweets and reddit

posts. #apes together strong popping up quite a bit. trey trades, an online investor with more than 200,000 followers believes there's a brand new movement that is starting up. >> i don't think it's a coincidence that volume is going up, the stock price is going up while you have this convergence between gamestop and amc's community and cultures. >> the elevated interest of both stocks is a motivator for all these apes they have double-digit short interests but still well below their historical highs back over to you. >> and is it hold forever, frank? i'm curious as you probe the story line a little bit as this goes around to the end of the year -- >> it's hold on for dear life. there's going to be some ups and downs because they're retail

traders, not people that are the savviest investors a lot is enthusiasm over the stocks themselves. and some of them are just really getting a kick out of sticking it to hedge funds. >> fair enough frank, thank you. coming up, a solar flare rising material costs are hitting the solar industry hard. plus a working lunch jon fortt sits down with amazon's ceo and he will join us live to share what they discussed. we'll be right back.

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welcome back i'm rahel solomon and here's your cnbc news update. funeral services were held today in indiana for corporal um better owe sanchez he was one of the 13 u.s. service members that died during the u.s. withdrawal from afghanistan. haitian prosecutors are asking the judge to detail the nation's prime minister over

possible ties to the july assassination of the president the prime minister received two suspicious phone calls from a key suspect in the case just hours after the killing. the justice department limiting the use of choke holds and no-knock warrants by federal officers the new policy comes just a little over a year after the deaths of george floyd and breonna taylor. crews are working around the clock to determine why a stretch of road buckled. no injuries have been reported but residents say they have been smelling natural gas fumes in the air there for weeks. tyler, i'll send it back to you. >> that is a stunning photograph thank you, rahel. let's take a market check and the dow as you can see is sliding, down 0.8 of a percent 286 points the s&p down in percentage terms a little less and nasdaq even less than that but all red arrows right now as we are in the middle of september. this has been the worst month so far on track since i believe it was october of last year

let's look at oil. there's crude down about a quarter percent at $70.28. the apple event just wrapped up. the stock is now near session lows, off about 1.5% or 2 points at 147.25. apple announced the pricing and launches of the iphone max, the iphone 13 pro at $999, the iphone pro max at $1099 and all of these mallodels are availabl for preorder starting on friday. now time for power movers. we'll start with the parent of cnbc comcast among the worst performers in the s&p 500. this as the company says it's seeing a bit of a slowdown in cable net ads at the end of august vizio is higher after stevens initiated the stock with overweight saying it is bullish on the company's advertising revenue opportunities. there you see it, up almost 5%

intuit in the green after announcing a $12 billion deal to buy the marketer mail chimp. >> big one we're familiar with it from those email news letters. solar stocks are pulling back after prices rose in the second quarter supply chain bottlenecks and higher material costs are here pippa stevens is here on what it means for the growth of solar installations. pippa. >> falling costs have been instrumental to solar's growth in recent years and that trend may be coming to a halt. last quarter solar prices were up on a quarterly and annual basis across all solar segments. according to a report out today. it's the first time prices for residential, commercial and utility have all jumped since they began tracking the data in 2014 solar systems are complex and depend on many components,

including aluminum, which is currently trading at its highest level in more than a decade. copper also found in solar systems and also seeing a spike this year. and then there's polysilicon which has gone from $9 per kilogram last year to $18 per kilogram this year solar panel costs are up 16% last year total installations jumped 45% compared to 2020's levels but if high costs persist, that growth could certainly slow. >> that's what's so interesting, pippa, you have huge installations that helps to drive costs lower over time but obviously not this time around now we have on top of that whatever these targets for clean energy out of the biden spending bill might be. >> yeah, exactly the department of energy released this big outline last week that called for solar to grow from 3% of president generation today to 45% by 2050.

and that is wholly dependent on supportive policies and falling costs. the environmental aspect of solar is great but economics are the value here if prices are higher, people will look elsewhere, so definitely a headwind to watch. >> pippa, thank you very much. pippa stevens. ahead on "power lunch" are market risks getting too big blackrock's fund manager will explain why they are trimming exposure to equities these days. plus apple wrapping up its big event but behind the scenes they have been dealing with a massive security headache. we'll talk about that and the group that hacked apple when "power lunch" returns. i wonder how the firm's doing without its fearless leader. you sure you want to leave that all behind? yeah. stay restless with the rx. crafted by lexus. experience amazing at your lexus dealer.

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welcome back, everybody. a cooler than expected reading in the cpi rick santelli is dickgging throg the action at the cme today. >> good afternoon, kelly indeed if you look at the last several times we've been in the mid-1.30s in the 10-year, it backs away every time. we have the two longest maturities of 10-year and 2-year bonds and the action was swift

once that cooler than expected cpi hit. if you look at the year-over-year even though the numbers were less than expected and off the extremes that we've seen, they're still at lofty levels at 5.3 and 4%, whether you're looking at ex-food and energy or headline year over year. bund yields moved about five basis points however, however, the big moves continue to be in the u.s. the close here could be a two-week low close for 10s right at the end of august but what's fascinating is 30-year bond yields should they close here and they're down 5 basis points would be the lowest yield close since the beginning of august, we'll call that six weeks. when you see the spread, 10s and 30s move to that extreme, most likely you'll see more follow-through so look for yields to continue to get pressure, perhaps toward 1.25%

cooler cpi is viewed as temporary i think why the equity markets also gave up some hard-fought ground kelly, back to you. >> rick, kind of a big deal this one because cmi is the biggest inflation event. you can say the pce is important but the cpi really sets the tone and none of them just really matter quite as much so you have a fed that is basically hinting it wants to go ahead and do, i think, the november taper i forget what month we're in here but to taper before the end of the year in the past few days or maybe over the weekend with "wall street journal." do you think that time frame can stand up after today >> well, let's put it this way i'm not sure i believed the time frame even before these data points however, having said that, i think whatever the fed timeline is or was in reality, i don't think it should change if i'm going to use the word transient in anything, it's most likely going to be the variant effects on cooler prices being

short term and ultimately i think the equity markets are looking at the number that way >> okay, rick, thank you rick santelli in chicago today. stocks have been giving up gains today. right now in fact the dow is at session lows even though today's inflation report was not as bad as expected. blackrock trimming equity exposure citing fiscal uncertainty, delta variant risks and any near-term inflation surprises, yet it would be a buyer of stocks should we see a market correction. to talk more about it let's talk with blackrock's global allegation fund portfolio manager. always good to have you with us. when you say fiscal -- well, let me start with the top line here and that is that september is turning into as historically has been true a somewhat negative month. any surprise for you that stocks are struggling as they are >> not particularly. you know, tyler, as you said september is one of the months

where seasonality does matter. it tends to be true in the u.s. and most markets outside of japan which is having an exceptionally good month i think we had a lot of crowding coming into the month. we've had two softer economic prints in a row, the cpi, the non-farm payrolls and people are taking a little risk off the table. if you back away from the day-to-day numbers, i think the reality is it's still a very strong market, very accommodative monetary policy and stellar earnings we would still be a buyer on weakness our expectation is by the end of the year stocks are 4, 5, 6% higher than they are today. >> let's talk about those three items that you cite for trimming your equity exposure, which we should put in context. you've trimmed your equity exposure but you're still overweight equities. is what you're driving at there the possibility of major tax

hikes? >> i think there are a couple of things first of all, there is the likelihood we'll see higher taxes both on the corporate side, individual tax rates and capital gains rates. combination, the timing still very uncertain how much more stimulus, net stimulus we're going to see when you control for the tax hikes also and finally there is this i think it's headline drama but it still may disrupt the market for a couple of days around the debt ceiling and the continuing resolution to deal with it so all of this is probably not going to make an enormous difference you're probably going to see that the fiscal package is close to expectations. but it doesn't mean there won't be some headline risk out of washington over the next two to four weeks. >> and we remember how the debt ceiling became basically a partisan war and one of the casualties was the market back in i believe it was 2011 you say you see opportunity in consumer discretionary, especially retail and durables but you are underweight

defensive sectors like staples i always have to be remiended what's a consumer discretionary stock and a consumer staple stock so i don't get them mixed up. >> the line is blurred there are a lot of companies that are in both parts of that sector distinction what i would say, i think the main message is the household sectors, despite undergoing one of the largest shocks in history, is in remarkably good shape. household wealth to income is at a record high. debt servicing costs are at a multi-generation low savings rate is very elevated. households have the wherewithal to spending. we believe as the economy continues to reopen, they'll do just that. where do we see the best opportunities? media, specialty retail, some of the durables connected to the housing market here's where in our opinion you have some of the best

fundamentals of any of the sectors today. >> durables like a whirlpool, is that what we're talking about? >> exactly companies that are basically geared to consumer spending and also to the housing market we're seeing a little bit of softness in housing recently there's been a little bit of sticker shock. but the reality is affordability is still very good rates are still very low and we also have these longer term trends that have been kicked off by covid that are probably going to go for some time, which means a greater propensity to buy homes, probably a bit more migration to the suburbs. all of this supports the housing sector and companies that are related to housing activity. >> and to be clear, i mentioned whirlpool, you didn't. i just mentioned it as an example, not as a holding of yours necessarily. all right, russ, always great to see you. after the break, a new series here on "power lunch. we're scheduling a working lunch with jon fortt he's had a busy day today.

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the labor market is tight, workers are showing they're willing to leave their job for a job that better suits their lifestyle or goals and at the same time amazon is hiring and says its goal is to become the best and safest employer in the world. jon fortt sits down with amazon's new ceo. >> yeah, kelly, when there are more jobs than qualified workers, sometimes employers get rejected and amazon's andy jassey has some experience with that as he told me back in 2017. when jeff bezos first asked him to be his technical assistant, he said no. >> it's funny. in retrospect it was complete score. it was unlike any opportunity i've had before or sense there is no question it was a huge part of my professional

development. at the time when it was offered to me i said no. it was a very undefined role when i talked to jeff about it, i said, well, what's the goal of the role he said, well, the role is for me to get to know you better and you to get to know me better and to build some trust. i said well, that's interesting but doesn't sound like a mission. he said, well, what would you like the role to be? and he was incredibly gracious about letting me craft and shape the role with him in a way that worked for him and added value. >> now he's got a clear role and he's the one thinking about all of amazon's hiring, kicking off a career day tomorrow where he hopes to hire thousands of workers. i pressed him on amazon's safety record and asked him how amazon has managed to hire when others can't. >> i think if you strive to be earth's best employer, and we have 1.2 million employees in lots of different roles and a

number of people in our fulfillment centers, there are a number of things that you've got to work on to live up to that goal one of them is a focus in an investment on safety but we've known for a long time that we have to be competitive on compensation and benefits it's why to your point we pioneered moving the minimum wage above $15 in our fulfillment centers. today the average hourly salary is $18.32, which is more than double the federal minimum wage. it's also more, jon, than 40 million american workers make. so we need to raise the federal minimum wage i hope the government works on that. >> so the big message for investors is brand, bucks and benefits that's how amazon is managing to hire tens of thousands of workers when other businesses are having some trouble. so not everybody has amazon resources, but if you think about what those mean to workers, maybe you can figure it out. >> they have come in in recent

days, haven't they, and said we will pay for higher education. >> yes benefits. >> but am i incorrect in feeling that amazon in recent years has had some bad press let me put it that way. >> oh, sure. >> about its role as the world's greatest employer. they say they want to be that, but there's a lot of stories out there that say they are anything but. >> that's why it was so interesting to me that in the latest shareholder letter, jeff bezos set that target. and, you know, this one i'm working on, i'm puzzled over it. i looked at the indeed rankings for warehouse work at walgreens, at walmart, at costco, at amazon they actually weren't that different. costco was a little ahead of the others, but after thousands of reviews, they all got sort of middling -- it's tough work, right? so maybe it makes a difference to add the benefits. and if they can improve, that is the question. >> i wonders also if the bigger

issue for amazon is the third-party selling issue. there's more and more scrutiny on whether people are selling stuff in flagrant violation of product safety laws. the journal had that big piece on a $35 billion crime ring people were trying to crack down on involving amazon's platform can it really continue to perform at this scale? >> amazon is like a microcosm of commerce not only do they have the issue of what's being sold on the platform, is that legitimate, is that safe. but there's also the question from regulators' point of view and lawmakers' point of view, are they treating the third-party sellers fairly who are trying to do the right thing on the platform. if you're allbirds or trying to sell a shoe, i imagine people are watching the television market it's good for consumers because they look like they have some really nice sets and good prices coming out in time for the holiday season are we going to move more toward the european style of antitrust and worry about how the other tv

makers do or more about the consumers getting a great deal. >> amazon has done what everyone thought apple would do, come out with its own brand and said. but they have entered into very expensively the media business what, if anything, did he say about that and where media fits in their portfolio in the future >> i tried to pin him down on that i asked him about mgm. the nfl they're already involved with, thursday night football. that starts up i think next year and roger goodell was just on cnbc a few days ago saying that they were looking for a technology partner not just to distribute their stuff but to help them build new product. i asked jassy are you interested in that. he didn't say he wasn't interested but these new tvs, eventually shopping and commerce will happen on them amazon has this big and growing advertising business you can see a lot of these technologies coming together because alexa will work on these

tvs too. >> this will be a tough act to follow. >> yeah. >> can you give us a preview of anyone else? >> i've got some great folks you know, we'll see who shows up in our little calendar here and what's on the menu. >> can we have food? isn't that part of the deal? >> thank you, jon. we've got another new iphone on the way and apple has secured its place as a staple product here in the u.s. so should investors trade it as a defensive name rather than a growth tech stock? our "trading nation" team will debate it next

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♪ welcome back to "power lunch. i'm seema mody apple shares are trading lower, after unveiling the iphone 13. shares of apple have outperformed the tech sector over the last six months, gaining about 22%, but a different story last week. so let's ask our traders what to do here. we're bringing in quinn tato, and delano -- i believe, delano, you're adding shares today

tell us why. >> it's most -- we have epic ruling this week we saw a bit of a dropback in the share price. i think share prices should be adding on the near-term weakness a couple things you're looking at, the big upswing we've had, i think the stock has been rather sleepy for the better part of a year, and i think one of the reasons why, if you look at it on a trailing 12-month basis, price-to-earns about 29 times, i think there's room for multipl expansion. how analysts are projecting iphone sales at about $240 million. and they're -- and also looking at the 5g roll-out which they're pointing to an area, this launch is important, this week is important, and i think you add the. >> quinn, i know you see this stock as more of a defensive

pick for your portfolio. is that right? >> it's had that characteristic of late. when the market is weak, i think people flock to apple. it has a consistent cash flow, a steady name, but i have to take the other side of the trade here i'm not a fan of apple at these levels, at delano said, in current multiple terms, it looks okay, but forward multiple of 35 is tough to justify when, if they hit their numbers, the numbers are growing at 10% meanwhile, the company -- it's a proxy for the market so as people are continues to be bullish on the market and add passive index funds, it will continue to participate. i think there's too many other opportunities out there. i'm not interested in buying apple here. >> we'll see where the stock goals from here. quinn and delano, great to see you both kelly and tyler?

>> seema, thank you very much. after the break, we'll give you an inside like at the mercenary company that hacked apple. we're back in a moment

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crepe corrector lotion... only from gold bond. apple is battling a big security headache. eamon javers has a look at how the flaw was discovered and the controversial company behind it. >> tyler, that flaw they discovered and rolled out the patch for yesterday is called a zero day/zero lick hack. that means apple had almost no time to respond to it. the hackers can get into the iphone without clicking on one of those any it's a very dangerous -- the grew called the nso group has put out spyware that it's selling around the world to clients that can get

into your iphone what do we know about the sno group is it it's an israeli software company that makes the so-called pegasus spyware software they say they only sell it to government, law enforcement agencies for fighting crime, but the group citizen lab says that nso group engages in despotism as a service they're selling it to dictatorial or despottic regimes using it against human rights advocating, journalists and the like, any dissident around the world. meanwhile, all of this has implications for apple i asked one expert, what can apple doing here he says they need to do a lot more. >> apple is essentially ignoring the facts their phones are compromised. it's not perfect they need to provide end users

with the ability to determine if their phone is compromised or not. today that doesn't exist >> apple gave us a statement here explaining their take, saying attacks like the ones described are highly sophisticated, cost millions to develop, often have a short shelf like and are used to target specific individuals, the implication being they're probably not coming after you, the regular joe citizen. nso said yesterday will continue to provide intelligence and law enforcement agencies around the world with life-saving technologies to fight terror and crime. so, tyler, this dispute is going to continue, but in the meantime apple has a problem. they put out a patch, and we'll see if any orel vulnerabilities are discovered. >> two questions is nso going to face any backlash, any charges for this numb gere two, is this group one of groups that was involved in cracking the iphone in one of

the terror attacks i'm thinking of the riverside attack some years ago, where the fbi needed help breaking into the iphone >> it's clear, tyler that nso could face some bash -- backlash from this. apple having to react here they've been getting a lot of bad publicity for months now a lot of folks in the cybersecurity world have focused on this. i spoke to dimitri, who was quoted in that piece, he says the israeli government has changed to a new political party, could have some bearing on whether nso group is allowed to continue to operate there, that the netanyahu government tolerated and encouraged this, and now the political winds may be changing, and they may face higher regulatory scrutiny >> thank you, eamon. we want to show you the

latest minimum wage here we were chatting with jon fortt about the hiring challenges that many companies are facing, in an effort to compete, walmart now has a higher starting salary all right, folks, thank you very much for joining us good to be with you. "closing bell" starts right now. >> thank you, kelly and tyler. welcome to "closing bell." i'm sara eisen a new apple lineup hasn't been enough to boost the market today. major averages are deep in the redheading south, as we head into the final hour of trade a look at what is driving the action today bank stocks are under pressure