e love is coming from your heart. the new york stock exchange is the symbol of what america is all about. the potential of capitalism, the potential of the american dream. the only way you can move a society forward is a true expression of freedom. ( ♪♪ ) ( sfx: stock exchange bell ringing ) ♪ welcome to "power lunch," everybody. i'm tyler mathis kelly is out with me for the hour is courtney reagan good to have you coming up, a fitch in time fitch putting banks on notice that even the likes of jp morgan may get a downgrade. moody's downgrading multiple names in the space but is fitch too late to the party here plus, shop till they drop? the newest data showing the consumer is holding strong, but for how much longer. we'll discuss that ahead.

first a check in on the market the dow lower by nearly 300 points moved low er perhaps by the fitc rating plus, some street talk around discover financial the company ceo resigning. that stock down more than 10%. also, good news, bad news. the good, warren buffett adding a stake in the stock bad, home builder sentiment dropping sharply with rates over 7%. we begin with the warning from fitch the firm saying it may be forced to downgrade dozens of banks, big ones, including jp morgan chase, coming after recently downgrading the united states credit rating. for market reaction, let's bring in doug butler, director of research at rockland trust what has got fitchy feeling

so -- well, i could rhyme but i won't. >> i'll also not go there. but again, fitch downgrading the banks, very core lair to what they just did. it's their really negative on the government and they're taking this as a broad swath they're saying the banking industry as a whole and greater problems which is why they would hit jp morgan kchase and every bank dow the line every bank from large regionals all the way up to jp morgan would get hit. and that's one of the reasons why it's spooked the markets a bit, feeling like this is a problem. but again, if the issues facing the bank, real estate problem, deposits, those are things that -- concerns have been baked in i do feel fitch is late to the party. but, you know, the market sentiment today, well, if there's any additional challenges, then it will be a

problem. >> i suppose you could say, you could argue if you're going to downgrade the u.s. government debt, therefore you need to downgrade everything else that is lower on the credit scale just by almost definitionally. but i guess the key question for investors is do you feel, do you personally feel that the banks that we're talking about here, some of the big ones, are in any sense on sand as opposed to concrete and cement? should we be worried about them? >> i don't think you should be worried at all i think almost there's very few banks out there that are on shaky ground the banks that went under were on pretty shaky ground there are probably -- there's probably a another couple banks out there that will get hit, that will run into some problems forced into a merger or

something like that over the next year, especially if they take a dramatic downturn yeah, do i feel like bank of america, wells fargo, jp morgan the biggest banks are at great peril, no. they're downgrading everything because they're making a case that financials are as a whole greater risk i think it's tied into that u.s. government call. >> if that's true, doug, the banks are selling off, you're not worried about them, you don't think they're standing on sand, is there opportunity to pick up shares of jp morgan on sale >> well, we were slightly aware -- already we're owners of jp morgan. slightly overweight where our targets are to begin with, but we're not adding to it today so we're not diving in with both feet but if we think there will be opportunities that you'll see in

the bank sector over the coming -- we ere on the side of being cautious about entering the bank space until you have greater clarity on how hard the possession will be we have seen a lot of recovery >> so you get -- you're talking about how the economy is going to land. it would seem that banking problems aren't going to be the precipitating event that either causes a recession or hardens up what otherwise might be a soft-ish kind of recession but the real concern here would be consumers and consumer habits. >> i think that's our big concern. it's why we sort of feel that today's market drop is a bit of a blip in the marketplace. versus a long-term trend you're seeing a strong consumer. i think most rallies continue

until the consumer feels uncomfortable. >> i think back to the last -- the great recession in 2007/'08. that was driven by a banking crisis >> right. >> if there's a recession this time around, my sense is it's not going be driven by a banking crisis >> no. they're never like the last one. but i think -- the economy still seems like it's going along pretty well. now who knows what will happen when student loans start getting repaid and all of that starts happening again. credit cards ticked up but again, you know -- there's ample opportunities out there in the market, especially if you're really focussed on staying ahead of the game. >> doug, we thank you for your

time today as always, good to see you, sir. doug butler. >> thank you >> you bet. well, on the consumer front, some mixed signals coming this morning. retail sales coming in stronger than expected. significantly seeing near 2% boost in online shopping home depot beating estimate. but the home improvement retailer reported a pullback on big ticket spending. with us to discuss the state of the consumer, former macy ceo and also with us, senior u.s. economist with bank of america thank you both for being here. i was really interested and intrigued to see the retail sales numbers today. got me wondering what the fed is thinking is it possible we could see a re-acceleration of inflation >> this was a remarkable report. we were above consensus based on what we were seeing in our internal data. the retail sales report came in even stronger than we were

expecting. you have to put that in the context of what was essentially zero inflation in july in the corresponding categories so we're looking at growth in consumer spending, around 1% in those categories in july which sets up a very, very well for third quarter gdp. yes, from the fed's perspective, certainly want to be vigilant. they want to keep an eye on where inflation is going on a forward-looking basis and that probably means they continue to push back against the timing and pace of rate cuts that the markets are pricing right now. >> help us sort of square what we heard from the government retail sales and what we heard from home depot today. certainly better than expected results nearly across the board. we talked how there is caution with consumer spending when it coming to more discretionary categories, big-ticket items what's going on with the consumer is the consumer strong or not or just depend on the category?

>> well, courtney, over the last year or two, we have been talking about how the consumer's savings account has been draining from the stimulus packages presented to them over the last couple of years that in itself would have been a big issue. however, we have now gotten to a different place where we have wage growth and people feeling secure about their jobs. and that is what's encouraging them to spend. so, i think we're in a much better place today than i thought we would be several months ago particularly with that wage growth number. and i think that's what we're seeing as far as home depot's comments, you said it. i mean, they beat expectations i think you're going to see a lot of retailers meet or exceed expectations but in many cases the expectations have been moderate. many cases the top line sales are forecast to be negative to last year. and their inventory is in better shape, so they'll be able to manage their earnings around expectations. >> terry, you'll be delighted to hear that myson who is applyin

to colleges just applied to the university of arizona where it's the lundgren secenter for retai. >> tyler, i'll give him a personal escort. >> that's what i'm looking for. >> no question i'm a personal recruiter to this campus >> all right >> i'll take care of that. >> let me ask you and terry the same question, aditya. a lot of people these look at the consumer behavior are concerned about the resumption of student loan payments how concerned are you, aditya? how concerned are you, terry aditya you go first. >> sure. we see that as a modest head wind spending no more than that. a lot of folks that have large amounts of student loans have also graduate degrees. they're a little older they probably have a significant savings. some people have already started to prepare for the resumption of repayment based on the fact that it's been so much in the news

over the last few month. so from a forward-looking bases, the 12-month onramp as well, we think it's a modest head wind that plays out over several quarters, but we don't think it is a factor that could potentially break this very constructive dynamic we're seeing. >> constructive dynamic. do you see it that same way? how big a concern is it? >> i think aditya said it right. he has great insights, by the way, on this subject so i agree and i also believe that in general, you know, while consumer debt is high, what i look at is dlingtsy rates. they're actually at a 20-year low. people are paying off their debts. they are winding down those high interest, high credit card debts. i think this is going to not be a major problem for us as we look forward >> terterry, we'll hear from so of the big retailer, target and walmart.

shares have gone opposite directions target is down 20% walmart is up 5% based on what we heard today from retail sales and some of the commentary from home depot what do you expect that we'll hear from these two big heavy weights? >> well, i think you'll hear that -- first of all, target pointed out their challenges in their last quarter my guess is that they're carving through those and setting themselves up for future improved performance down the road i would be surprised come this quickly in this quarter. on the other hand, walmart has been performing. keep in mind, you know this, tyler and courtney, but a substantial amount of their business i think is over 50% now is food and grocery related. and there still is inflation in those categories so you don't need unit growth to grow you need maintaining unit growth or maintaining units volume from the prior year and getting your growth quiet with inflationary pricing. not true on the other side of the business, but the fact is

that they have less dependence on that than target. that's why you'll see two different stories there. >> all right folks, thank you very much terry, aditya, thank you for your time. appreciate it. >> thanks. coming up, those retail sales depend on consumer's desire and ability to spend. which more and more relies on credit in part buy now, pay later with consumers already holding a record amount of debt and student loan payments as we just mentioned set to resume, will shoppers keep spending on those buy now, pay later plans plus, the global chips rate, the u.s. facing more and more competition for ai chips i almost said ai chips there, courtney, like the sauce but not just china saudi arabia, buying more than 3,000 nvidia semis more on that when we come back

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welcome back data out today shows retail spending is bert than expected as credit debt balloons and these loan payments come due, some are forecasting an impact that could impact the buy now pay later but our latest guest doesn't agree. i was pulling through some old notes from other firms, trying to average out what the loan payments might be when they resume on the low end something like 210 from wells fargo per month

on the high end, maybe 460 bucks. why don't you think that would affect spending? >> agree with those numbers. those are the same numbers we got. we don't say it won't impact what we say today in our survey about 300 users of buy now pay later is that the impact will be lower than what people think obviously there will be an impact but it will be much more muted than a lot of people are thinking if you just look at our survey, about 50% of buy now pay later users, firm, square, afterpay, et, have student loans the other 50 don't on average, the impact to the industry is just short of 2% so it's actually not that much if you take -- >> people who have the student loans, healthier financially otherwise? >> that's a great question i think that's the answer. there's a clear link between having student loan and household income so what we found out is that student loan, people who have student loans have higher incomes. about 10,000 --

>> college educated. >> you know it intuitively, but seeing in a survey makes sense 80,000 on average people with student loans versus 69s or 70 very interesting link between more buy now and pay later apps and higher income. >> i was going to ask you, i don't understand that then why are you needing to use buy now pay later if you have a higher income? >> it's relatively higher. thinking about the average household income, buy now pay later user in our survey is 80,000 with student loans 69 without student loans. it's still kind of not sort of the -- if you're making 150 or $200,000 a year you're not going to use buy now, pay later. on average, on an average basis, they're little better off with noneducated student loans. >> you think that fact will blunt the impact of the resumption of payments on the economy?

>> partially >> well, it has to there has to be some impact. but i think the fear factor is much bigger than what we'll see. people were worried -- i was talking to the management of a firm they know that this is coming. there's -- investors and management are concerned about it down the road in the fall >> so i'm fascinated in general by these companies and these products, buy now, pay later, because many of them if you sort of follow the rules, you are more or less getting free money, paying them off and there is no interest and so are people using these instead of credit cards, in addition to credit cards what has consumers learned what the product works and what it enables them to buy? >> in terms of is it a replacement for credit cards >> yes >> there's two cohorts people that use it at the very low end, right, they don't have access to credit but there's also we have done surveys and research in the past that there's also kind of steady pays the bill users.

at the end of the month, we get someone else is paying your bill for you. it's all over the place. a lot of people shop online using affirm a lot of people use afterpay when they shop in stores by the way, what firm has done and other guys have done, they tightened the credit because of what happened. you have less of the lower cohorts and more of the -- it's a mixed bag. >> i know retailers like it because it often increases the transaction value. >> correct. >> at really not much cost to the retailer. >> and that's the biggest opportunity here that people are missing. this is my personal view this is a huge conversion mechanism, right >> sure. >> so retailers love it. >> what do you mean by that? >> converting means the retailer has the choice making a sale or not making a sale turns out having buy more pay later button increases the odds of selling the product so i'm willing as a retailer to take a 5% merchant discount rate

in order to sell the product that's a great trade by the way, credit cards interchange is not that much lower. we're talking the difference is maybe 1 to 2 points between buy now pay later and credit cards acceptance, but it's free advertise -- not free advertising but sort of like a conversion mechanism to lure people to buy more online. it increases demand. >> which of these buy now pay later companies do you think is best positioned? >> affirm is the rolls-royce they figured out how to get big breadth of the products, services paying four higher ticket items. peloton a lot of us were buying during covid that's how they started. afterpay is doing a good job, too. it's part of square or block part of the bigger comprehensive offering affirm is the pure play, rolls-royce of buy now pay later and they would be the front-runner here for the next three to five years. >> interesting companies thank you very much for joining us today on "power lunch."

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welcome back, everybody. on this volatile day for stocks. let's check in on the bond market rick santelli tracking the action hey, rick. >> hi, tyler what a fascinating day short maturity yields are lower. long maturity yields are toying with history 8:30 eastern, retail sales, up .7 of 1%. as you look at that chart, something should jump out at you. it's that even though this was the best in six months outside of january, where it was much stronger 2.8, it kind of fits with pre-covid maybe a little bit stronger. it certainly doesn't feel like the markets and interest rates should have rocketed the way they did maybe it's the following charts. now here is import and export prices they had precipitous drops six consecutive months lower for both that doesn't add up. why did interest rates pop on that maybe that explains why we have

come back down the short maturities, yields are lower. now look at how 10z and 30s move on the number the way they spiked you have as high as 426 on a 10-year, 435 on a 30-year. why are these significant? they are super significant let's open the charts up towards the third week in october of last year. and the answer should jump out at you 4.25 is the current high-year close for ten. intraday we took it out. it's all about the close 30-year bonds didn't quite get up to their's. 438 is their number. both on the 24th of october. two-year note yields did the same thing in march and they failed to close above that level, even though they took it out intraday these are hugely important technical aspects of the marketplace to pay very close attention to courtney, back to you. >> thank you very much, rick santelli oil falling 2% today pippa stevens has the numbers.

energy in focus here today as the sector. >> yeah. so oil is under pressure thanks to the data out f o china. a sluggish economic china and fears around whether or not the central banks surprise rate cut will actually do enough to boost their economy. and of course china is the world's largest crude importer certainly something to watch there. but today did want to look at the refiners because bank of america downgraded the group to neutral, saying they think the risk/reward is skewed towards the risk side looking forward. they have been very bullish on the industry back in march of 2022 they said it was the golden age for the refiners and since then, they have outperformed both the energy sector and s&p 500 as well so they do think the firm does think that the urgent earnings picture has been structurally reset and is now higher going forward. but given the outperformance over the last year, now is the time to lighten your exposure. >> more of an evaluation call? >> yeah, exactly they basically left for dead because the long-term case for the refiners has always been

under question given that there have been calls for forever about peak oil coming. i think in the last year, particularly with the invasion use case around oil longer term has been reset so that has drawn interest in refiners we have seen a lot of capacity come offline, covid, fire out of philadelphia refinery that was never replaced bank of america is saying time to pback. >> thank you appreciate it. now to bertha coombs for a cnbc update. >> hey, tyler. there's concern across maui about the chemical contamination from the fires the state health department cautioning people that the ash and dust from burned buildings might carry toxic chemicals such as asbestos and lead many of the buildings in lahaina were built in the 1970s before those chemicals were phased out of construction. meantime, speaking at an event in milwaukee, president biden said moments ago that he

will travel to hawaii as soon as he can the white house says it's an active discussions about a trip. he faced criticism from some republicans about not speaking much publicly in the initial aftermath of the fires. and another soccer superstar heads to saudi arabia. they have acquired neymar from paris. transfer fee, $98 million. might as well just round it up to 100 million. >> that's not even his salary. >> that's incredible those numbers are -- i don't understand that. >> that's the transfer fee. >> they can write those really big checks oil prices are what they are. >> one report is he makes 200 million a year from playing for this saudi team. >> wow. >> thank you >> thank you ahead on "power lunch,"

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welcome back to "power lunch. the nvidia invasion spreading around the globe >> well, once again nvidia is among the top winners on the nasdaq 100, up about 8.5% on the week on the notion that everyone wants to get their hands on its chips. china isn't the only country front running nvidia chip orders no, the financial times reports that saudi arabia alone purchased more than 3,000 nvidia h 100 chips as the nation develops own generative ai models china, ua and microsoft, google, all wanted nvidia gpu chips. imagine how hard for the smaller firms to scale up the ai models.

global race to accelerate ai capables put a major strain on the gpu chip supply chain and could limit the near-term upside for nvidia can't get the parts, can't sell the chips. supply will be the primary determinant for its data center revenue at least through 2024. but, wall street, of course, continues to pump up its name. today wells fargo, ubs all raised their price target. you can see on your screen, well above 500 bucks ahead of nvidia earnings out next wednesday. keep in mind, there has been recent stock fluctuations with nvidia down 5% on nont, so it shows investors are nervous this ai phenomenon will cool. it's still too early to get off the train. consider it nvidia has that first mover advantage, for now at least. >> they are the name in the category so far as i can tell. christina, stick around far couple minutes as we are joined by our next guest, runs a

company caught the middle of the race to secure ai chip may be a bit of an under the radar name shares up around 4% right now today. and more than 150% this year a lot of ceos would like that kind of performance. the company still reporting a loss for the quarter costs remain high and margins a little lower than expectation or hopes. the ceo and co-founder of navitas semiconductor. welcome. good to have you with us the report is very, very favorable on the top line. your revenues, i think more than doubled compared with a comparable quarter a year ago. anyone would love to see that. but, obviously what people would love to see even more is profitability. when do you expect to see that >> yeah. well, thank you for having me, tyler. and it's great to be on this show we're on a great track towards profitability. we're in a steep growth curve right now having completed a few quarters, each quarter doubling from the prior year.

35% up from the prior quarter. we predict profitability in the next 18 months or so we're in a great position to deliver exactly that these chips are powering virtually all modern electronics with clean energy, energy saving technology >> what is the impediment from where you are today and reaching profitability in se 18 months. what's holding you back? is it because your costs are high or that the margins aren't where they need to be? what is it as you sit there as the ceo and you go, how am i going to get there, what's holding me back? >> it's really early days, early innings on capitalizing on this huge opportunity to displace silicon, $22 billion market today, towering all modern electronics, evs, data centers, powering home appliances, powering virtually all forms of electronics. they're being displaced by next generation technology we make.

as we ramp our revenues, our costs are right in line, our expenses are right where we want them to be to not only deliver profitability but deliver leadership and bring that back to a u.s.-based semiconductor. we feel good about your position in the high growth, high investment period to deliver on. >> i'm curious about your business in china. it says your mobile growth has continued there, but so many other companies both in your sector as well as others are struggling with china's recovery that's been a little more choppy than hoped, i should say what are you seeing in china and how you making sure that market continues to work for you? >> yeah. our technology i prefer to it, it has the benefit of both worlds it's both an enabling new technology and new markets, electric vehicle, energy storage, solar inverters but displacement technology. we're going into existing

markets like charging your phone and laptop, instead of using silicon, we're tags charging the laptop or phone up to three times faster with half the size and weight as we do that, the market could be flat or declining and we can still deliver significant growth as we're converting those existing silicon designs over to this new generation technology. >> people will love that faster-charging evs and phones and so forth christina, you're still here, aren't you >> yeah. i want to piggy back just off of what courtney asked in regards to china your front end manufacturing is 100% outsourced to taiwan semiconduct ertz they have ten in taiwan, two in china. are you concerned at all about how much or how reliant you and other companies nvidia are reliant on one name? >> it is true they are the larger supplier to the whole semiconductor industry but our chips are 100% manufactured in the u.s.

we have multiple options coming to us. factories originally built to make silicon now want to upgrade factories. so we have many options and plan to diversify into all of these different regions to serve the u.s. global needs outside of taiwan, outside of china we have a very nice diversification strategy coming. >> but that diversification strategy is a ways out you said you're still at the early stages of building the plant here in the u.s. it's obviously not cheap we know what's going on with on semi i feel like is this something that maybe is really not in the near term or at least not in the next few years for you >> it's actually surprisingly quick. that's the benefit of this technology we can retro fit older existing fab in our case, we can actually retro fit older silicon factories, in about 12 to 18 months some of those efforts are already under way.

it will be a lot faster than you might expect. >> gene, thank you we appreciate your time today. >> thank you so much, tyler. >> and christina, thank you as well. courtney still ahead, deal or no deal hollywood studios offering the writers guild a new deal in a push to end their strike, reportedly planning to meet at the negotiating table to discuss terms. we'll get all the details when "power lunch" returns. we've got your back, road warriors. because we know you're picking up the pace, steering life at 10 and 2. you're hitting the road... and we're helping you get there with confidence. so skip the counter without missing a beat. choose any car in the aisle. and be the boss of you. go national. go like a pro. pano ai chooses t-mobile for business for 5g solutions... ...because t-mobile helps pano ai innovate,

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welcome back hollywood's studio set to meet with the wga to discuss the most cent deal offer. some industry leaders are pushing hard for a settlement. this is a script writing itself, julia. what's going on? >> i'm hearing optimism. i have been talking to a number senior media industry executives they're telling me they are optimistic about progress after what they see as a productive meeting that happened between the amtp and the wga on friday sources telling me that the east coast leadership of the wga has flown out to los angeles for meetings this week, meetings in which they'll respond to the

amptp pay increases and around overall pay and particularly streaming compensation the studios reportedly reassured screen writers they will not replace them with ai tools and offered minimum staffing requirements for the first time. and they even reportedly broke sharing specific streaming data. there is talk that the increases in streaming royalties that were won by the directors guild could be used as a template for these talks. and then eventually whatever eventually writers deal does come could be used as a template for the screen actors guild which is also out on strike. all of this comes as the screen actor's guild strike tops one month and that guild announces lit no longer allow actors to work on indy, nonamptp contracts in the u.s the strikes have already cost the u.s. economy an estimated $4 billion costs will grow to $5

billion in the next month and rise faster if workers are laid off and entertainment-related businesses really start to shutter here now sources tell me if things aren't resolved, specifically with actors or close to it resolved with actors guild by labor day, will we start to see many more movies pushed from the fall release skchedule to sprin or later in the year i'm hearing there could be massive damage to the movie industry if films are moved out of the schedule. that could train people once again they don't have to go out to movies to see -- to be watching content and feels like we have seen that surge in movie going this summer they don't want to unlearn those patterns. >> as you schooled me, julia, most of the movies that would be set for release this fall or winter have really post production and are all but done. so why would they hold them -- >> that's right. >> why would they hold them back sit because they can't -- the

actors can't go on promotional tours to promote the movies or what >> exactly exactly. so if you think about the role that margot robbie played in promoting "barbie" she was out there, doing interviews, she was a huge part of the awareness of the movie. and studios really rely on actors to promote their films. so if you have a film, say, like the "dune" sequel, go ahead and release that film without timothy out there to promote it or decide to hold back to the fall these are the types of conversations the studios are really going to be having intensely about which films they want to release without the promotion stars, which ones they can get away with not having an extra promotion and which ones they're better off waiting and having that promotional engine for movie stars and maybe holding off and releasing films later. these are tough conversations. when you think of a big star, a big brand, when is it worth it, when it is not >> what are people doing who work on production sets? what are people doing to make

ends meet? taking jobs as waiters or construction or what >> well, the one thing i would say is that the picketing is going on so writers and actors, they are picketing. people who are working on production sets are trying to find jobs in reality tv, in documentaries, in those areas where there is still shoots. reality tv is the key thing there. anything related to sports or news or the like obviously those businesses are still on going and i talked to a number of people who are either starting to take jobs driving for uber or to pick up odd jobs here and there. so definitely hearing about a lot of people here in l.a. who are looking for temporary work, hoping that this is resolved fairly soon. >> yeah. that was what i was starting to wonder, julia. obviously they held out for so long, but at some point some members of these associations, these unions, probably can't just continue forever and ever

without any income do they pressure the leaders, hey, you have to come to a resolution yes, we want things better bewe also need some work. >> yeah. absolutely they want to make sure they're getting the gains that will really influence not just how they get paid but also how the generation of writers after them get paid or generation of actors after them but especially the writers it's been over 100 day we hit the 100 day mark last week okay, we want to get back to work obviously the studios, they have been saving on costs they want to make sure they don't have an empty broadcast tv schedule and have to push their films out even longer. so i think there's a sense especially for the writers guild strike going on for so long now that they're really ready to get back to work the screen actors guild they have been on strike 31, 32 days now. so that's obviously not as long. and the question is if we can get a resolution, writers and studios, how does that push the screen actors guild to come to a similar compromise.

>> julia, thanks great to see you as always julia boorstin. shares of discover financial sinking on news the ceo is stepping down immediately. now be a time to buy it on the dip? we will trade discover and other moves of the day and our famous three stock lunch. "power lunch" will be right back

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it's time for today's three-stock lunch. first up, dr horton shares higher today in addition to other home builders after warren buffett's berkshire hathaway revealed its position in the stock, betting on the u.s. housing market dr horton up 40% last year was a nasty year for the home builders. today with our trades is david trainer, new constructs ceo. what's your take on new constructs >> i like them, especially if the home builder is focused on the lower-priced half of the market in dr horton you're looking at a stock with great risk/reward it's one of the most profitable companies in the market.

it's priced as if profits will permanently decline by 20% we're seeing really good risk/reward in terms of strong macro tailwinds, strong profitability and growth >> the chart has been up and to the right for most of the year. next up, discover down 10% today. opposite direction after the company announced the ceo will step down effectively immediately with john owen taking over as interim ceo should we pick up this stock on sale >> we think this is on sale. we think the bad news is priced in here. this is probably going to be forming a relative bottom. another super strong profitability great track record company, 10% annual growth and profits over the last decade it's trading as if its profits will permanently decline by 50%.

the market is already pricing this business as if business will be cut in half. we think risk/reward is really good here. they're historically had high ratings in customer service. underwriting is strong we think the bad news is behind them and now is a good time to buy the dip. lastly we have the ev maker lucid group, shares down as tesla unveils cheaper versions of its model x and s cars at $10,000 less than the regular models they do have less range. can lucid stand up >> lucid isn't trying to stand up to tesla. they're at the super high end of the market at $139,000 average selling price. they're going after tesla's target market. where tesla has made its money is in the higher end of the market and struggled more in the

lower end because there's so much more competition. lucid has never made any money this is one of our original zombie stocks. it wasn't until lucid was able to raise $3 billion from saudi arabia that we took it off the list because the likelihood of running out of money like we think zombie stocks will is pretty low when you can raise money at $3 billion a clip it's a bad business, losing a lot of money >> let them spend the money on neymar instead of the cars >> that's right. >> thank you we appreciate it. we only have a few minutes left, but a bunch of stories we still want to talk about it's closing time when "power lunch" returns

we only have two minutes left in the show and a bunch of stories you need to know home builder sentiment dropping sharply. the latest nahb survey shows sentiment dropped 6 points in august, the first decline in seven months rates for a 30-year top 7.2% it's crazy to see that with a seven handle. >> it is the home builders have had a rough run in 2022, a great run over the past year here comes a wall of worry, i would say in the form of those interest rates amazon says its pharmacy is introducing automatic coupons on

insulin and other diabetes care products, making many insulin brands now available for as little as $35 a month. the key is technology developed by amazon that automatically applies manufactured sponsored . people did get the coupons but didn't know how to use them. this automates that process and does something policy makers have wanted for a long time. >> i think it's fabulous with so many americans needing this life saving drug. apparently gen z workers feel too committed to their jobs to take a vacation a survey found 58% of gen z workers planned to take time off in the next few months 35% say they feel guilty while they're aware from work. >> this has not been a guilt that i have suffered i've suffered from many forms of

guilt, but the guilt over taking the vacation i've earned has not been one. >> that's good that's healthy i'm not gen z, but i have suffered that guilt. i still take the vacation. >> thanks for watching "power lunch. don't you feel guilty either thank you so much. welcome to "closing bell." i'm live from the new york stock exchange this hour begins with this increasingly edgy market, rates edging higher, china weakness worries and an economy here at home that might be too hot for comfort. your score card looks red. the dow dragged all day. energy and materials weighing heavily on performance today nvidia about the only thing going for the nasdaq the bounceback