we invent them, we design them, we build them. and one day, we have to let them soar. ♪ i'm always coming home ♪ ♪ welcome to "power lunch," everybody. alongside kelly evans, i'm tyler mathisen glad you could join us on this tuesday. the dow just turning negative, but we did set some new records

for the dow earlier and the s&p 500 as well. >> and the dow is getting a boost today from caterpillar, in particular one of several stocks benefitting as china tries to boost its struggling economy, they had a raft of stimulus measures announced last night. i was not overly impressed by the 4% market move they enjoyed. but the case was made that it is the start of something significant on the monetary policy side. >> their economy has been struggling a little bit, certainly, by many standards people would be envious of the growth they've had, but not for china. they have a lot of people they need to employ and this cut of a big rate over there could be one of the moves in the direction to stimulate. we'll see and see what american companies might benefit from that. on the downside for the dow, you have visa reports that the doj is set to sue the company and call it a monopoly, particularly with respect to its debit card business. >> yes we'll hear a lot more. there's so many different attempts right now to regulate or deregulate a lot of what's going on in the debit card

industry, but this is -- we're seeing a lot of these pieces of action right before the election it's not that it's political per se, but it's just -- there's an agenda and if the clock is ticking, you're going down the agenda this was first brought three years ago, culmination of that agenda we got official notification this afternoon, stocks have been down 4% right now. that said, let's start today with taxes because it's the number one issue for a lot of people in this election. specifically talking about what the candidates proposals might look like in terms of raising revenue to be able to fund some of these widening deficits and to help kind of put the economy on surer footing. >> absolutely. a lot of proposals out there some endorsed by both parties and others very much not endorsed by both parties let's continue the conversation on taxes, as former president donald trump is making comments on the economy right now in savannah, georgia. he's been talking for roughly an hour there eamon javers joins us from

washington with more on what mr. trump is saying. eamon? >> reporter: tyler, that's right. a live picture of former president trump speaking this hour in savannah, georgia. laying out his vision for the american economy and going on to a number of other topics as he usually does trump is making the case for too long americans have seen too many companies be sold off to foreign competitors and that instead of foreign company -- instead, foreign companies should move their manufacturing to the united states senior trump advisers say if elected trump will personally recruit foreign companies to come to the united states, making a sales pitch directly to them about business conditions here and also asking what they need in order to make a switch happen the former president has made a number of promises about what he'll accomplish in his second term, including a 15% corporate tax rate for companies who make their products in the united states, lower regulations, efforts to cut energy costs, steep tariffs on foreign imports, tax exemptions for wages earned in over time and through tips and in savannah, trump told the audience he's going to reverse

decades of job offshoring in america. here is what he just said. >> under my plan, american workers will no longer be worried about losing their jobs to foreign nations instead, foreign nations will be worried about losing their jobs to america >> and the former president is in savannah, because he views it as a great american port with infrastructure, feeder companies in the nearby area all needed to be one of the premier export hubs as he sees it for american made vehicles going overseas one other point i should said as the former president was speaking, he said he will stop the u.s. steel nippon steel merger pending now there's question whether the biden administration will take steps to stop that deal. that decision time frame seems to now be slipping past the election in november, but now you have the former president saying if he wins in november, he's going to stop that deal

when he comes in so seems both potential future administrations are extremely hostile to that potential deal to see whether anything -- >> what has the administration said about that point? i thought they said they were inclined to stop that deal >> we had a lot of reporting that said that president biden would stop the deal. and then he didn't do it under grounds and whether the report will come after the election that would give the president the ability to stop it of course, if you put it past the election, then maybe the current president could allow the deal to go through though, a lot of supporters will say, that's a deal you shouldn't block because nippon steel is japanese and japan is a staunch american ally. doesn't make sense to block that deal both the current administration and now the potential future administration are expressing real hostility to that deal and to the idea of an iconic american company becoming subsidiary of a japanese firm.

>> although, this one in particular give mes some pause because the ceo said the better outcome for workers will be this ownership change correct me if i'm wrong, this is an industry that saw the innovation from the japanese 15, 20 years, struggled to keep up and at some point the new technology is superior, i guess what would the argument be, they the turn to the u.s., then you fund our investment into this n newer, cheaper -- what other options do they have >> the argument politically, what you heard donald trump say in savannah, georgia, i'm going to stop this deal. i'm going to keep u.s. steel in american hands and keep the japanese from buying it. that got a huge round of applause from the saudaudience savannah, georgia. if you're u.s. steel, you're trying to navigateall this the timing is exquisitely bad coming in the last two months of an election cycle. and you figure, your best bet is

probably to punt and get this decision point after the election with an outgoing president who won't pay any political capital for letting the deal go through before kamala harris would come in or donald trump would come in in january. their best bet is probably to get it done in november or december under president biden before the end of his term. >> i'm looking at air bus to see where the plants they have are you can pick an example in the foreign automakers significant employers in the southeast. so i take his point. i understand what you're saying about people's reaction to it, but these are also core areas of employment and opportunity as well big part of the debate we're about to have as well. thank you, eamonafters reporting. president trump laid out plans as well to exempt certain sources of income from taxes how do you make up for that lost revenue? robert frank is looking at that issue for us today hi, robert >> reporter: good to see you, kelly. former president trump started his campaign with a plan to

extend the 2017 tax cuts cost the government $4.6 trillion over ten years then he started adding even more called for adding -- ending taxes on tips i should say that could cost up to $200 billion in lost revenue. he then promised to end taxes on social security. that could cost another 1.6 trillion he then said he would end taxes on overtime. that's another 1.8 trillion. he wants to, as eamon mentioned, lower the corporate tax rate for domestic manufacturers to 50%. that would add another $700 billion and, of course, last week remember in new york, he called for, quote, getting salt back, reveal that $10,000 cap on state and local deductions add another $1.2 trillion to the deficit. add it all together, trump has now proposed tax give aways totaling nearly $10 trillion over ten years how to pay for that? well, he said tariffs would help offset the cost. analysts estimate tariffs would

raise at the most about 2.8 trillion, which means trump's current tax plans would cost about $7 trillion added to the deficit over the next decade now, we should add that vice president harris also has proposed extensive tax cuts. they total about 3 to $4 trillion, but she has also called for increasing taxes on the wealthy and companies. that would increase about 3 to $4 trillion in taxes, so that would offset most of her tax breaks >> so, let's talk -- drill down a little bit on the totals here. so, overtime tips, social security taxes, the restoration of no limit, i guess, on salt, state and local tax deductions adds up to $10 trillion for ten years. minus some tariffs that might or might not offset some of that 10 trillion >> reporter: that's right. tyler. we look at the $10 trillion in

taxes which sort of keeps going up every week it seems like depending on who he is talking to he adds another tax break. kamala harris doing much of the same but aside from the tax increases that she has already announced, we haven't heard any offsets for either these candidates. so, as you say, trump let's say will give him $3 trillion on tariffs, very generous most people put at 1 to 2. total deficit add 7 trillion harris, you add in her 4 trillion in tax breaks, but 3 to 4 trillion in tax increases, there's perhaps mild increase in the deficit if not deficit nuch. >> neutral >> all right, robert frank, thank you. so would it shift the usa to a more consumption-based tax system or at least a way from a system that is built mostly on taxing income? and what could the impact be on americans and the economy. joining us now to discuss is

brendan duke, the senior director of economic policy at the center for american progress action fund and casey mulligan, professor of economics at the university of chicago. casey mulligan, let me begin with you let's talk about tariffs and their power to generate income or revenue for the federal coffers here how much could those tariffs add? and who pays tariffs do foreign countries, foreign companies and foreign individuals pay the tariffs? or do americans pay the tariffs? casey? >> on the revenue question, we have a lot of what we buy in america is from america, regardless of whether we have tariffs. so there's a limited amount of our spending out there that can be tariffed. and some of the rates that i've heard people talk about, i'm not sure where that's coming from. in the republican platform that president trump presented in milwaukee, was adopted by the rnc, refers to baseline tariffs.

i don't expect those to be all that large, although it's a whole republican operation so republican congress and house would have to decide what they mean by baseline tariffs and how much >> brendan, let's talk about the idea that part of what may be afoot here, president trump moved away in his proposals to exempt overtime tips and social security income from taxes is he moving away from a reliance on the income tax as the principle way the federal government is funded and in any sense toward a consumption tax? >> yeah, sure. so, as you guys said, he's proposed about $10 trillion of tax cuts basically all on the income tax side reducing our base on income taxes which the wealthy disproportionally pay. he pitched 10 to 20% tariffs on

every imported good entering the united states, which is a consu consumption, tax, works in effect like a national sales tax. so that's raising reliance on consumption taxes which low and middle income families will pay more of than they do income taxes. it's a shift of our revenue mix from income tax to consumption taxes. in that way, in a weird way, actually a way that could actually really harm economic growth. >> you're shaking your head there. do you not see it that way >> no. tariffs are not a consumption tax. it's also an investment tax. we import -- aside from residential investment, pretty much all other kinds of investment, we are importing a lot of -- fair chunk of that as i said before, most things we buy as american, whether it be consumption or investment, but the mix of imports between consumption and investment is like the rest of the economy so, i would view it more as more

like some kind of expenditure tax or even somewhat like an income tax, although not the progressive element of it. >> somewhat like an income tax so, where casey, in other words, is all the revenue going to come from are tariffs of 10% or whatever number put out there enough to supplement the changes or income lost on a traditional income tax? >> well, i don't think there's a plan that to have huge cuts in the income tax the salt part, i don't know how that got out there there are people in trump's orbit from california who want salt back. of course. but president trump had dealt with that debate many times in his administration he's always siding on the side of keeping the salt out. and, you know, it's a give away to blue states i don't see how we could possibly expect president trump and republican house and republican senate to bring the

salt back. >> he said it last week in a rally in union dale on long island he basically said he was in favor or would fight to get that salt deduction back into the tax code. >> i don't expect that to happen for the reasons i mentioned. >> yeah. well, there's a lot that probably isn't going to happen, like -- there's probably a lot that isn't going to happen because people are throwing around lots of promises. brendan, let's talk about the idea of pivoting toward a consumption-based tax. i've always thought that one of the flaws in our tax system is that different kinds of income are taxed different ways and at different rates and that is a distortion it causes people to seek out income to get paid in ways that produced the lowest tax rate if you went to a consumption tax, is that a more efficient, not necessarily progressive, but a more efficient way to bring in

revenue? >> look, i think the key thing is that a consumption tax given the u.s. congress, given president trump, is likely to have just as many holes in it as the income tax i mean, you can't take the politics out of politics. >> it would have loopholes certain kinds of expenditures that wouldn't -- or a vat which most countries have. most countries have a vat. >> sure. but different rates on different types of goods, right? so again, you know, you can't take the politics out of politics there certainly would be loopholes. >> what i'm driving at is a vat a more efficient way to raise and collect revenue for the federal government than an income tax is? >> again, i just -- like a vat you made up without congress putting in exemptions is one category that i think is not realistic. but on another level, i think the key thing is when you look at the studies behind what moving to a consumption tax, replacing with income tax would do, you get some increase in

gdp, but most families are worse off because their paying more on taxes. so i think that's the key thing to me, in my opinion, middle income families would be worse off paying more in taxes the wage increase isn't good enough to offset that increase in taxes. >> casey, do you agree with that >> there's no doubt that the -- what ty is saying is correct the europeans have politics, at least as much politics as we have, but they have these vats and loopholes. the payroll tax, revenue machine and much higher rates than we have here. our 12 plus% seems like a lot, but they have a lot more than that in europe the revenue machines brendan is correct, too, it's regressive europeans have quite a regressive tax system. really the most progressive tax system in the industrial world is the united states because we emphasize the income tax comparatively speaking that has these higher rates for the higher income folks. >> is there enough revenue left to be raised, though n this era

of deficit spending and high debt from the income tax side especially if you go down to chain of families making under 400 or 200,000. >> it's hard to imagine getting -- >> look, in my -- >> sorry, casey go ahead. >> it's hard to imagine that from income increases. look at europe, been there, done that the way they have the large welfare states is payroll and vat tax. >> payroll and vat would have to support kind of the situation we're sleepwalking into, that's casey's argument, brendan. do you agree >> at the most basic level, before we did the trump tax cuts we were raising more money from the income tax so at the very at least, you could go there, right? so i think just the basic sense that we've continued to cut taxes over the last couple decades, we could certainly just kind of go back to the tax system that we did have before that was raising enough revenue to meet national needs, like we did, for example, in the late

1990s. >> if you were to cut the payroll tax, which supports social security and medicare, how would you sure up the finances of social security, brendan? i mean, i don't know how you would do that? it seems to me you have to go the other direction. you either got on social security, either got to raise the payroll tax to fortify it, make it more formidable, or you have to raise the amount of income that is subject to the payroll tax from whatever the level is today >> i couldn't agree more trump proposed no longer benefitting social security benefits those erode the social security income base, basically, because the tax social security benefits go to the social security trust fund i actually calculated that it would bring up the date that social security runs out of money by three years from those two policies alone so again, we need to be addressing this problem and social security is like the most

popular program in the country >> brendan duke, thank you very much casey mulligan, thank you for a very stimulating conversation. we appreciate it. >> my take away is payroll taxes are going up that's so interesting. >> i don't know how you solidify social security unless you reduce benefits some way or expected benefits without either making the amount of money that is subject to the social security tax or the payroll tax higher >> absolutely. >> that seems like the way to go, but i don't know. >> glimpse into the future perhaps. ahead on "power lunch," starbucks receiving downgrade. the new ceo brian nichol might not eugbenoh to freshen the pot. we'll speak to the analyst

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major ceo shakeup, jeffries is downgrading starbucks to underperform, siting a long turn around for the company despite the stock being up 20% since brian nichol was announced as the next ceo we could be due for downside the rally may be overdone. joining us is the analyst behind the call why are you going in the direction? >> good afternoon. thank you for having me. the reaction has been so positive that it's now taking into account the full turn around already having taken place when brian is just really getting settled in we like brian a lot. we just think there's a lot of work to be done here to get this business stabilized and then moving in the right direction again. >> do they have to break things to put it back together so to seek >> a little bit. i think there is some cultural and people issues that have kind

of crept in over the last 18 months under the prior prior leadership that has created some challenges and a little bit of operational issues that are the first thing i think brian needs to address obviously he's not the only one that will do that. he'll be adding to the management team and making changes as we've already seen a little bit in terms of some of the announcements of departures, of existing starbucks executives. >> when i patronized starbucks, several things that stand out to me one is it appears to me that they have too many combinations and choices on their menu. that's number one. number two, their staff seem overworked they've got digital orders coming in, they've got drive-thru orders coming in, walk-in customers coming in and third the overall customer experience isn't as pleasant as it used to be and the prices are higher where does he start?

>> yeah. those are all very key points. i think simplification will be the name of the game again, under the prior ceo, there was a lot of innovation that really seemed to be spinning its wheels and not generating incremental customer visits as you mentioned, tyler, adding a lot of complexity and frustration to the partner baristas trying to exec cute this experience for the guests and if they do a better job and they're happier, more guests will likely come in. it's really the first step is a few steps back and simplifying and trying to get that partner experience improving again and having them buy off on the vision to deliver a better customer experience and then we'll see where it goes from there. >> at what point do you kind of wait for a reset or some would say, okay, fine, more downside ahead. is this still a good entry point? how quickly can he start to pivot the ship because this is

afterall a marketing-driven business maybe it would be easier to fix than say boeing. >> there's some aspects of truth to that, but it's obviously a lot larger, more complex, more global than chipotle, where brian executed a fantastic turn around and growth over the last five plus years. so i think it's going to take a longer period of time. he's got to build his team he's got to get through expectations for fiscal '25 they need to lay out in late october when they report the fourth quarter. and all of these things are going to point to sort of uncertainty and again complexity that leads to, i think, some uncertainty in the stock and having it drift back in to where it may wind up being, you know, a little bit more attractive again from a valuation

perspective because i think the valuation has kind of gotten ahead of reality here. >> all right people are excited they want their starbucks to get better we'll see if he can do it. andy, thank you so much for joining us. >> thanks. have a good afternoon. >> you, too. further ahead, meta went all in on the meta verse from rnd to changing its name. so it's called meta. but the meta verse kind of didn't really get a lot of traction now the company may be using a similar strategy in ai we'll talk about that when we return in just a couple minutes.

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♪ welcome back shares of visa, the best performer along with mastercard really of the stock market in the 2010s are now the biggest drag on the dow today. eamon javers is standing by with breaking news. eamon? >> that's right, kelly attorney general merrick garland is set to announce the justice department filed for monopolization and unlawful conduct in debit market. the complaint alleges that visa

maintains its monopoly position by blocking growth of other competitors. the government says here that more than 60% of debit transactions in the u.s. run on visa's network, which allows the company to charge more than $7 billion in processing fees every year and the government says that visa's agreements with merchants and banks punish its customers who route transactions to other networks or systems. we'll reach out to visa to get their reaction the biden administration beliefs that actions like will help bring down prices overtime and help to show that biden and harris are doing something about number one economic concern which is inflation trump were to win in november. it's not clear that large corporations would be out from under the anti-trust microscope here the trump economic team is taking aggressive line on anti-trust one of the current anti-trust cases against google began under the first trump administration and continued under biden. real dove tailing of trump and biden and potentially harris

we'll have to see in the future in terms of anti-trust, guys back over to you. >> eamon, thank you very much. quick check on where stocks stand right now. earlier today we got a reading on consumer confidence showing it slipped to its lowest level in three years there you see the industrials have gone negative i think they set a record earlier today. s&p 500 flat, nasdaq up a little let's get to rick santelli in chicago with a look at how the consumer confidence news is coming out in the bond market. rick >> yeah, you nailed it, tyler. watching at 8:30 eastern when i brought out these numbers. the weak confidence numbers definitely had an immediate effect on interest rates bad news is bad news for long-dated treasury yields because as you look at a chart, since the wednesday the fed lowered rates by 50 bases points, we have seen 10-year note yields rise every session 2-year note yields are in a path moving lower auction today of 69 billion

2-years slightly above average grade. tomorrow is 75 billion on the 5-year front a lot of people should be watching this chinese currency look at the chinese yuan, the dollar is at the lowest since may of last year keep the same date and british pound, a currency on fire, pound is at one-month low. we know what the yen carry trade is yen strengthens, parts in the u.s. and global some of the trades start to break apart. and what we're going to see is what the carry trade with the chinese currency you want to pay very close attention to those derivatives as well and finally, the dollar index being a technician, look at the right side of that year to date chart. 100.5. we touched it, touched it and touched it

technicals are like packman. you take so many bites you end up going through violation of that would be technically significant and in my opinion is a matter of when i couldn't think of the word derivative >> come on i notice rick, real quickly, not to overly belabor, the dollar index pointed 100.7. do we consider that a break or no >> it has to be on a closing basis. closes under 100.5, a lot of these models will move on that >> all right thank you very much, rick. appreciate it. rick santelli. to seema mody for a cnbc news update. the suspect facing gun charges discovered outside former president golf club will be held without bail pending trial. that's according to a judge's order released today which weighed several factors, including the defendant's prior conviction and recent travel to foreign countries. prosecutors said yet they plan to be also charge ryan routh

with attempted assassination israeli air strike in beirut killing hezbollah commander. the israeli military says the hezbollah commander led its missiles and rocket force. and caroline ellison facing sentencing today for her role in the fraud that led to the collapse of crypto exchange ftx. she could face years in prison but prosecutors said she deserves leniency because she served as a star witness in their investigation. kelly, back to you. >> i read she wrote a romance novel as well, edward yan, while this was all taking place. seema, thank you very much seema mody. heading to break, let's get a quick power check on the positive side. free port mcmoran, up 8% on the negative side, huntington ingals down. under pressure to the downside under pressure to the downside we'll be right back after this

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♪ welcome back to "power lunch. worries about the economy have been hanging over the markets with this morning's weak read on consumer confidence, adding to that, plus don't look now, but earning season is just a couple of weeks away. chief investment officer with pence capital management welcome. >> happy to be here. >> how much more do you think the fed will or must cut interest rates to make sure we don't dip into a trough? >> it's turned into question about cuts to question about cadence, right we're moving from cuts to what is the cadence we had the 50 bases points we think probably two more this year and then they'll probably spread it out over 2025 as they begin to kind of see and get the data in. >> so you get rates ultimately that are two points lower than they are now, 3 in the quarter range and that is a equilibrium exists. >> equill librium is probably 3.

they will take their time. you don't want to blow the soft landing by reigniting something. so ithink that's kind of where -- it's like if playing gymnastics with data they stuck the soft landing. so let's give the score and go on. >> you're looking at some -- you almost got both in your portfolio of the either/or fight going on chips or go small cap and the bronding out you've got amd and the small caps and asml stake. why this approach? >> well, i think that the point is first of all, you're going to continue to have the maga caps do pretty darn well, but their earnings projections are a little less for next year. but when you look at the rest of the s&p 500, you're seeing a continued growth 13 or 14% on earnings growth, that's going to be a pretty good market for next year if you take a look at it so, i think this broadening out, i talked about being part of the 493. so trimmed down some of the

magnificent 7, begin to see small caps grow in this environment. lower interest rates for companies that borrow. so i think all of those things are coming together to have a broader diversified portfolio, broader diversified set of earnings growth going forward. so 2025 begins to shape up as a good year. >> get on the 493, sounds like driving directions in l.a. get on the 493 to the 405 and whatever so what about the seven? i take the seven or not? >> well, if you take the seven, you're still going to get there pretty good. right? it's -- the seven will be all right because you're going to probably have a 19% earnings growth going to come down from 30 or 40 it will come down to 19. but you take -- you take the seven, you're doing all right. >> new york subway line. >> that's it that's it. so it's all about transportation today. >> yes, it is. >> which route do you take >> but i guess, is there any which way you see this kind of ending not so well

we talked -- it's pretty much consensus now, soft landing. we spoke to retail analyst, said he is excited about the names in the sector after we get through the holiday period i guess this is the all clear? >> you know, you never want to say all clear. but i think the thing that you worry about is some large shock. you always have to -- there is tail risk out there. and that would derail it otherwise, i think more people are working than ever before more people are making more money than ever before. >> is that true? >> yeah. we have grown -- >> just because the unemployment rate is up a at the margin, there has to be some loosening. >> we added 6.1 million workers in the last couple years that's like the entire labor force of illinois. if you take it and multiply out by salaries, we added the entire economy of france in the last four years. >> wow >> so if you think about that much money, that many people, you know, stimulating this economy, it really gives us a good basis for looking at things

going okay now the softer part of the soft landing, right, the people making under $50,000 a year, those are the ones that were heavily affected by this consumer confidence number but i think that when you look at it in total, we're set up for a pretty good basis. again, off lot of people working. they're making money, they're spending it. that's what consumers do. >> i don't know why the fed cut rates. we'll go a quarter and -- >> i think they felt that they maybe should have moved in july. and so, we didn't move in july let's go ahead and get 50. and then we can be data dependence it's all about cadence going forward. the far is different now than they were a couple years ago they got bullets in the arsenal. they got bullets in the gun. they have the ability if they have to make moves to lower interest rates then they have the ability to do that and i think that's really important. >> nice to see you again. >> dryden pence. >> appreciate it tesla shares -- i'm sorry

meta shares near all-time highs ahead of its big developer conference kicking off tomorrow. we'll get a preview of what to expect there including clues into its ai strategy when we return the shares are up 59% year to date >> announcer: crypto watch is sponsored by grayscale ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪

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welcome back meta shares are fractionally lower today after hitting a new all-time high yesterday. up 300% in the past couple of years. the company made that much publicized pivot to the meta verse, but it's been a real ai winner, having quadrupled now since two years ago. the company's developers conference begins tomorrow and julia boorstin will be there she joins us now with a look at meta's ai strategy i keep hearing about the glasses, julia >> well, there's a lot to look out for tomorrow at meta connect. and meta is expected to unveil new ai tools tomorrow there. and that's all part of its plan to spread adoption of its open

source ai llama model to avoid the emergence of a clear ai gate keeper like apple is on mobile devices. now meta going all in on open source, has exponentially grown its ai reach and adoption while rivals are offering paid enterprise models. the meta's llama models downloaded over 350 million times since early last time, including 20 million times in august and llama usage across its major cloud service providers, including microsoft, amazon, nvidia doubled may through july. now all of those big numbers speak to the wide range of companies that are building applications with meta's open source software from goldman sachs using it to help extract data from documents. at&t is using for customer service tools. and accenture used it as well. plus, ai startups are now building with llama, rather than

having to raise millions of dollars to create their own foundational models. start up contextual ai tells us it is far more efficient to not train a model from scratch and llama is leveling the playing field for startups why is meta open sourcinglama? it does benefit from the feedback it gets on the a.i. model which then makes meta's own a.i. chatbots more effective. once companies build with meta's models, it's a lot easier to integrate their products and bots into whattsapp that will grow engagement on meta's various plat fornls. >> they think open source will be the pay - >> pay for more but not monetarily - >> you need the products, the ecosystem. the tools. julia, thanks. sorry. julia boorstin. moving ahead, chinese stocks surging after beijing unveiled stimulus measures to boost the nation's sluggish economy.

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(aaron) i own a lot of businesses... is advice worth talking about. so i wear a lot of hats. my restaurants, my tattoo shop... and i also have a non-profit. but no matter what business i'm in... my network and my tech need to keep up. thank you, verizon business. (kevin) now our businesses get fast and reliable internet from the same network that powers our phones. (woman) all with the security features we need. (aaron) because my businesses are my life. (kevin) man, the fish tacos are blowing up! (aaron) so whatever's next we're cooking with fire. let's make it happen! (vo) switch to the partner businesses rely on. welcome back big news today as china unveiling a massive stimulus plan to boost its struggling economy. we're seeing a pretty big stock market reaction as a result. you can see craneshares up 10% doesn't matter if it's the internet names such as ally bab by, baidu or jd, on are a

carmaker likely soaring if it's chinese. many companies with big business in china are also seeing a boost from this stimulus so for "three stock lunch" we're asking if they can stick or if it's not enough to save the chinese. here is jerry castle let's start with caterpillar helping to lift the dow on its rally today. would you be a buyer >> the three stocks we're talking about today, cat is the one that doesn't rely on the mass market in china to support its earnings and order book and cat has been doing quite well going into this. we worried on the commodity market side that china was going to erode the fact they offer stability should improve their earnings outlook and their order book i would be a buyer of cat here. >> let's move to las vegas sands on pace for one of its largest gains in recent memory what do you think about lvs? >> yeah, so lvs, las vegas

sands, is high ly dependent 75% of their cash flow is from chinese-based gamblers have you to ask yourself, where have they been the market has recovered in macau but only through a lot of prom promotions the profitability has been mediocre there relative to expectations we would still hold it, though, because it's not clear that chinese are done stimulating and that we could get to that mass market gambler soon. >> let's bring us then to estee lauder, one of the poster children of china's up and downs, getting a nearly 6% boost today. should you buy this one? >> no, i'd be a seller there's too many structural problems here. they've got to fix a lot of things in their core business. even though china is half of their market cap, i would not touch this i'd sell it on the bounce. >> how do you feel about the prospects overall, jerry, is this going to work for china or, no, not enough >> no, i think this is the right

step we've been waiting for them to respond the u.s.'s interest rate cut clearly shows stimulus is back on the table they better be ready to do two or three other rounds. >> two or three other rounds, wow. thanks for your time we appreciate it. >> they're playing our song. that means we have to get out of here that's it for "power lunch." >> "closing bell" starts right now. guys, thanks so much welcome to "closing bell." i'm scott wapner from the new york stock exchange. this make or break hour begins with the dow and s&p heading for more milestones in the closing stretch. 6 0 minutes to go in regulation. the dow is a touch negative but it's been up for most of the day. here's the s&p a new record high at close, too. nasdaq up half a percent industrials and tech are leading the way as china announces more stimulus measures. we're following that and that is gifting a lift to names like freeport, caterpillar. a whole host of china-based internet companies, too. they are hav