i think it will make another run at 100. no position currently. >> okay. thank you for that. sarat setting sethi? >> adding to shannon's utility trade constellation energy pulling back today and an opportunity to get in. >> good stuff. i will see you in a couple of hours. "the exchange" is now. thank you very much, scott. welcome to "the exchange." i'm kelly, vans and here's what's ahead. we are in the final election countdown. we'll roll up the latest polling data and look at the key initial trades to consider under each outcome. we'll also look at what the market seems to be telling us it thinks what the odds are of who will be the victor and research is calling this a harris win and a split congress. it's down about 26% this year and the name in wyatt would rally ahead and tweet me if you can guess it. plus we're checking in on the

consumer with the economy still issue number one. from housing to groceries we'll bring you the trends and trades you need to know and latest berkshire moves and what was sold and what all of it, including the company's growing cash pile may be telling uses about this market. before that, though, let's get dom chu with the numbers. >> modest pullback right now, kelly in the markets overall and there's a lot of focus on what the dow is buying and selling these days. more on that in just one moment, but as things currently stand right now. we're treading around this wait and see area especially for the s&p 500. the s&p 00 currently at 5723, which is down about five points so relatively flat on the session. at the highs we were up roughly 13 points and down 32 points at the low so well off the lows of the session and still marginally downand the level that some traders are watching is 5703 in the broader s&p 500 and that represents the 50-day moving average and we're near to medium-term trend line and keep an eye on that and the nasdaq

composite 18,235 and the dow industrials, 41,880 and down 173 points or one-half of 1% decline. and let's talk about the dow. we saw on friday, learned of the addition and subtraction for two key names here. on the semiconductor side, intel, longtime dow component is moving out of the index effective friday. it's down 3.5%. meanwhile, the stock that's taking it over, maybe no surprise is nvidia which is up about 1.5% right now and that's the chip exchange of the dow in and out and then there's another one in materials and that's taking place in effect, as well and if you take a look at intel versus nvidia and sherwin-williams up about 3.5% and that chemicals trade going in and out of the dow, as well and if you take a look at these you'll see why the trajectories have been in opposite directions for intel and nvidia over the last five years, down 61% for intel and nvidia up 2500% and

the specialty materials trade and that one interesting, as well. the dow is down about 12% during that time span. sherwin-williams up 91% and it gives you an idea of where the dow is headed. kelly, back to you. >> thank you very much, dom chu. we are 11 hours away from the start of election day and the race is as tight as it could be. the latest polling shows vice president harris taking a lead over president trump 47-44%. the state has voted red in the past two elections and had trump surpassing harris by six points just a month ago. meanwhile in kansas, recent polling shows harris trailing trump by only five percentage points while the difference has always been double digits going back to 1980. those are just two polling slices. for more on where things stand let's bring in larry sabato, director for the center for politics at the university of virginia. larry, it's good to have you. we wanted to highlight iowa and kansas in particular. your protege, p.k. carnick was

explaining this to me a little bit, but there's a hurting behavior with a lot of these polls that have them showing the races nearly tied. iowa and kansas may be somewhat of an exception to that. can you dive into this a little bit and explain what you think these latest data are telling us? >> sure. of course, we have 11 hours which means we could have 20 more polls between now and then. i'm a little suspicious, not about the kansas and iowa poll. i'm suspicious that by our count over the last nearly six weeks there have been 67 tied polls both in the national numbers and in the seven swing states. what? there's a herding instinct here, and i don't blame the pollsters. they really got it in 2016 as did many of us forecasters in 2020 they also got it wrong. it was much closer than they projected in the swing states, so i get it. they're preparing the way, but i just don't believe that it's

absolutely dead tied the way they're presenting it. now you have to go state by state. we don't have time to do that, but i'll tell you this much, i think in the end the split in the electoral college is going to be relatively narrow. it does not have to be 270 to 268 although a lot of people are betting on that. some bet on trump getting 270 and others bet on harris being 270. this is one of the closest elections that we have seen certainly since 2000 and what a lot of people have forgotten and didn't live through in the bush/gore race. the polls weren't that tight during the election campaign and bush had a steady lead not in every poll, and a pretty steady lead of three percentage points which in this race would be a landslide. so this is special. this race is special. >> so let me just go back to the point you made about the herding behavior and a lot of people

have made the point that if you flipped the coin a number of times you should get outcomes that are deviant from the central range. instead, all of the polls you're referencing seem to come out with an outcome of essentially of a tie and the pollsters don't want to be seen as getting it wrong. there's no way to know if harris 53 or trump 50 whatever. so where do you turn to glean what might really be going on when we can't necessarily tell how the results may be smoothed or adjusted? >> i use the word tweaked. >> tweaked. >> they tweaked the results close to where all of the other pollsters are, a point or two difference. look, where you have to look is to the professionals in each state who know the state's politics backwards and to are wards. you mentioned the iowa poll. ann selzer is a pollster for the des moines register. she's had a great record over the years. that doesn't mean she hasn't been wrong, she has, or her

polls have. mainly they've been right. you can argue the details getting into the internals that mainly it was because of statistical reasons. you will have an outlier occasionally even in a very good poll and that should tell us something because you put your finger on it. we haven't had many those outliers. there ought to be more of them. having said that, when you put the kansas poll together with the iowa poll and a couple of others i've seep. one in ohio and another one in wisconsin, you can see where older women, for example, 65+, and to me that's young, older women seem to have tuned into the abortion issue, to reproductive rights and they're unhappy with the republicans and that may be one reason why the polls show harris doing better than she has in the entire campaign at least in those

states. >> last week the market was pricing in what looked like a trump victory, if not a gop sweep. we had certain assets that the djt was up, the dollar was strengthening and bond yields were selling off and as these online -- that's much switched and today has a very different feel to it and it seems like they're bracing for a harris victory. to borrow a phrase, if i put a gun to your head, larry, instead of who you think will win the election, who do you think will win right now? >> who would i guess? we'll release our final prediction later this afternoon and my team has pledged not to release them in advance, but i will say your observations are very much on point. a week and a half ago just about everybody except for hard core democrats were picking trump to win. now a lot them have backed off those predictions and it is

tough to call, and it is extremely close, the tough to call more are leaning to harris. can you take to the bank what most are saying today when they say we were wrong a week and a half ago. my suggestion is people keep their money in their pockets. i hope i didn't hurt your network and the stock market by saying that. >> i doubt it. let me just quickly almost make an observation that you can comment on before you go. there are some who said even if trump won they would expect him to be shellacked in the midterms and narrowing the number of months he might have to implement an agenda even with congress. i don't know if you think that's jumping ahead too far or if there's some merit to that as kind of a second termer and what not. so if they're in this for the long run maybe the gop if they don't pull it off tomorrow can look to the midterms or maybe i'm getting ahead of myself. >> history says you're right in the sense that midterm election normally goes against the party in power especially if it's a

two-term incumbent and it's called the six-year itch. we only have one example of this in all of american history, grover cleveland and when i asked him about this at the time. i'm kidding, i didn't personally ask him, but it does make sense when you think about it. people will hold the conditions of the country against you if you have had two terms and normally it's consecutive terms, but i think they might do that in the case of trump and certainly for harris, too, but trump in particular because we all know how many outrageous things he says in the course of a day much less a year and after two years of him, he could be as unpopular as he was in the first term. >> stocks always have to discount six or 12 months out and looking at those midterms is hardly a stretch for people who are putting, to your point, their money on it. >> larry, thank for your time. we appreciate it. >> i enjoy talking to you as always. >> larry sabato.

that's the latest on the polling front. chris cynic has broken down his expectations for stocks and bonds in the four most likely lex outcomes. one of them is a harris win and a split congress and that would be good for this name elf, our mystery chart which would see a relief rally and shout out to txc for winning that one. let's turn to chris. i'm hearing a lot of optimism for retail stocks this would be one of them. >> hi, kelly. thanks for having me on. there's been an overhang recently since midsummer with respect with the retail stocks and elf produces a lot of their goods in china and along with other retail names, the dollar stores and dick's sporting goods and you can go down the list there. a harris win would certainly remove that overhang that's been persistent really since the summer and be a catalyst for

these consumer names and discretionary more broadly. >> any others that places you would be looking to which is a harris win and a split congress. >> the democrats should be harder, but who knows at this point. >> yeah. the other area is utilities and when you think you see a fall in driven bay the so-called term premium and rising trump odds. yields fall and that would benefit utilities and the train within the utilities and the names like nextera and the solar names are the places to be along with the tariff exposed names. solar green, china-exposed tariff names are the first initial trades that you want to think about that not only are a trade, but i think have a longer duration theme to them in a

harris win whether it's split congress or whether it's a so-called blue wave. >> if they end up having a sweep, you would still want exposure to the green energy names although again, these things don't always turn out the way that you think, you would also be selling financials and i wonder a harris win with either a democratic congress would mean. we are talking about an increase in corporate taxes that would be a 4% or 5% win for eps and it doesn't feel that consequential, but it's there. >> what's interesting is financials and utility sectors are up the same percentage year to date, and if we think about election outcomes the two are at the epicenter of kind of the torque trades in opposite directions meaning a trump win regardless of whether congress' gop control is divided i think is very bullish for financials because of deregulation and that could be done without any type of things passed through congress, as you know, and it's very negative for utilities and

yet the two sectors are essentially up the same amount year to date. so something's got to give there with respect to that and financials are by far the clearest winner because of the deregulatory aspect and more m and a and more capital markets and the ten-year treasury and a trump win regardless of what the congress is probably arises 25 to 50 basis points and the higher market level and i think it's absent some unanticipated event, i think the election itself once we know the final results is a clear event and stocks pushed higher regardless of who wins. >> you have trump when you like cyclicals and harris when you like tech and the secular growers. what do you think of the trump win and starting to price it in. ye, i think whether you believe it or not, it's tied into where

it'ser inially a tie by some measures and it's the harris trade. solar n solar names and yields are up and crypto is down and it's gotten a lot tighter than it was perhaps a week or two ago with that and that's the message we're seeing today in the markets and expect more volatility, right? tomorrow could be the exact opposite based on how the wind's blowing. >> absolutely. just quickly and finally, as we see a sell-off as these results start to come in either way, with either outcome you'd be a buyer? >> i'm a buyer on the dip. yeah. >> chris, thanks. appreciate your time. chris senek with world research. cnbc will be covering that live all night tomorrow night all throughout the night and results when they come in and reaction beginning at 7:00 p.m. eastern from the new york stock exchange continuing through the wee hours and "squawk box" will begin an hour earlier at 5:00 a.m. eastern. still to come, the market widely

expecting rates to come in. oh, yes, there is a fed meeting as well and we'll get the results a day later than usual. they spark debate about whether they should be cutting or not and we'll dig into that nut. decking company trex is after recent quarter shows a divide in decking that could give investors a clue about the consumer and we'll tell you what it is and what the ceo is seeing in the home improvement market. "the exchange" is back after is. this is "the exchange" on cnbc. no one puts more love into logistics than these three. you need them. they need a retirement plan. work with principal so we can help you with a plan that's right for your team. let our expertise round out yours.

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it's a big week for the markets, not just the election. th there's a fed meeting i a rate decision on thursday and it has sparked some debate by whether and how much the fed should cut. when we last saw each other i think it was a 100% chance of a 25-basis-point cut. >> yeah. i'll try to explain this weird trade out there in the futures market. some look at the recent rise in bond yields, kelly and concluded the fed should not cut rates this week and that might miss the real debate in the markets. the debate is not about this meeting or even the next one. it's over the terminal rate several meetings down the road, where does the fed stop in the next year or so? take a look. since the fed cut 50 in september an unusual move by the ten-year soaring over 80 basis points and an unusual move with more cuts on the way, but while

that's been going on, the probability of a 25-basis-point cut this week has remained as kelly said not just at 90%, but it's at 98% now. the chance of a follow-up cut in december stayed high north of 80% and it's january and beyond where they start to enter the market psyche here. if you take the october 25 contract for the terminal rate it has surged by what was that number for the ten year? same one for this one. 80 base points from 282 to 267 now and it's still a hundred basis points lower and the current rate has the price cut built in from one to 30 years trades below the funds rate. another sign that rate cuts remain built in just not as much, kelly, down the road. it's the terminal rate debate that we've had. >> we've also talked about what's driving bond yields higher and the market is helping us by changing it day to day as we saw last week there was a big

political factor because when trump was leading in the polls bond yields picked up, and of course, you layer in the weaker jobs report. how seriously do you think the market is taking that? >> i didn't have time to put up the chart, and i doubt they have it now, but we have a chart showing it's a regression done by wells fargo among other people showing the ten-year and the trump chances of victory side by side. >> there was a big move that seemed to be linked to it, but i hate the notion of saying that the market is doing this because of a candidate because it gives the market an extra vote that i don't think it deserves. there it is. look at that. >> on the marks. they bet on -- >> i know, but those predicted numbers bug me. >> the real rub is whether it's right and nobody knows until these candidates get in office and it's the opposite outcome of what everybody thinks. >> that's true. it's very hard to game. it's part of the reason and i'm glad you brought it up. it's hard to do monetary policy if you don't know what fiscal

policy is. if they give us spending and deficit spending, guess what? the fed will give you higher rates and if they give you less, trump has been scored, i guess, his plans to be more deficit spending than harris, but both are going to give you, i think, very high deficits. >> but the fed is likely to cut by a quarter even if we don't know the outcome of the election on wednesday and thursday. >> i think so. i think december is locked in. january is when we'll talk then. >> sounds good. thanks. steve liesman. our next guest says the best thing to do now is to chill because high yields are into perfection and going from 17 times trailing earnings two years ago to 26 times today. joining me now is emily rowland, co chief strategist at hancock investment management. is that a reference to t-bill and chill. are we brickinnging that back?

>> no, it's a reference leading up to the election. it's about managing risk on ea either side. you look at large-cap equity market and the valuations are extremely extended and the s&p 500 growth index is trading at a 50% premium or 54% premium to its long-term anke andverage an earnings are just not there. they have not been robust and maybe we can go there. nope, those are low-quality stocks. 40% of the russell 2000 index is comprised of companies that don't make money. so we're going to the middle here. mid-cap equities are trading at the steepest discount to the large-cap counterparts since the late 1990s and we like the valuation protection there and they're also benefiting from fiscal spending and from onshoring activity that's prompting manufacturing renaissance of the united

states. >> we need to get neal hennessy back on and talk about the often overlooked middle child. to back up for a second, what would you do with bonds and fixed income? >> bonds are tricky as well. you talked about the map and interest rate that we've seen. bonds aren't acting like themselves. friday was a remarkable day. we saw this bad jobs report. i know there was a lot of noise, but 12,000 jobs is significant downward revision to the tune of 112,000. the ism manufacturing index which is a key gauge we watch of economic activity coming in at 46. that suggests contraction and then meanwhile we see bond yields backing up ten basis points and oil prices really didn't move much. pretty interesting moves here that are all based on political sentiment and we also want to think about going to the middle in bonds. the challenge going into credit. yeah, the economy is doing okay, but credit spreads are remarkably tight.

275 basis points and that's well below the 20-year average of 500. so i would say that high-yield bonds are likely priced for perfection here and could see some spread widening and then you think about adding to duration and there's a risk there as they just talked about if there is pickal spending and more supply coming online which would push up bond yields and we're looking at the intermediate part of the skufsh and down the fairway at core plus bonds. >> meet me in the middle and that's the chorus as we discuss this. i know you're talking kind of long term and oriented. >> yeah. >> but we are probably going to get big moves one way or another whether it's tomorrow night or as result comes in, it could be a stock sell-off, could be bonds -- are you guys ready to jump on opportunities like that? >> yeah. we don't look at these shorter tier moves in the market. one of the things that is interesting we looked at the performance under the last two

administrations and it is almost exactly what you would have thought. under trump chinese equities were the best performing assets you could have owned. technology stocks were way at the top of the list even though there were regulatory measures to potentially break up tech. technology stocks did great. you look under the biden administration, best performing class, energy stocks, oil prices. exactly the opposite of what you might have thought given the green energy policies. so we tend to place more weight on the macro economic backdrop and the earnings backdrop. remember, over time, stock prices follow profit. we will try to fade the noise around the election and to your point earlier, some of this could just be promises and we still don't know exactly how these policies might be implemented. >> you're making that point very well, actually that it's fun to put together these baskets of who might win and how that would likely favor and not favor, but the results have often been contrary, so maybe a buying opportunity and maybe the smarter thing to do is wait.

i don't know. >> what do you make of what warren buffett is up to or what berkshire seems to be up to? they're selling out of big positions and they have a lot of cash on hand. what does all of that tell you? >> to us it probably makes sense to have some discipline particularly as a value investor. we look at the valuations on the s&p 500. over the past two years earnings have actually gone nowhere, but we've seen one of the most robust bull markets in history. the s&p 500 up 50%. all of this is based on multiple expansion. we've gone from 17 times trailing earnings to 26. we've only been this expensive on the s&p 500 two other times in history, 1999 and 2021. so to take some chips off the table here, to be limiting buybacks and potentially selling into some strength as a value investor it likely makes a lot of sense. >> yeah, and they can't go mid. >> right. >> 300 billion is what the average mid-cap stock is probably what?

a market cap of 60 or something like that. >> yeah. >> yeah, anyway, emily, appreciate your time. >> thanks, kelly. >> john hancock investment management. we don't compare notes ahead of time. it just keeps happening. government officials keep warning on relying on chat bots for election information. we look at how start-ups like open ai and perplexity, and what does it anorme f the future of generative ai? we're back after this. &t, it's ! you locked us out?! and when thrown a curveball... arrggghh! ahhhh! [crashing sounds] we had everything we needed. is the internet out? don't worry, we have at&t internet back-up. the next level network for small business. ♪♪ i sold a pillow!

♪♪ data science can help address some of the biggest challenges in financial markets. if we focus on the mortgage market and follow the life of a loan from origination right through its pricing in the capital markets, our data science capabilities can provide a deep level of insight. at ice we have extensive data sets, especially around three pillars. the property, the mortgage and mortgage performance. this trifecta of data and its history is a bit of a data scientist's holy grail. ♪♪ so, you know, han is 22 years old, and we've been together most of my life. not often do you have a childhood dog that, that lives this long so i think it's really unique and special that we've experienced so many, so many things in life together. knowing that he's getting good nutrition and that he has energy is a huge relief for me and my dad.

“such a good little bean.” we're so grateful to have had this time with him, so let's keep it going and make every day special. welcome back to "the exchange," everybody. i'm tyler mathisen with your cnbc update. israel has officially notifying the united nations today that it's ending relations with the u.n. relation for palestinian refugees. the israeli government passed legislation to ban the agency from operating within the country. critics have warned that the move could stop the flow of humanitarian aid into gaza. meantime an ohio jury found a former columbus police officer guilty of murder and other charges in the 2020 shooting of andre hill. the officer adam coy testified that he thought hill was holding a gun when he shot him. prosecutors say hill was holding a cell phone and keys, and was

complying with the officers' commands. coy now faces at least 15 years in prison. and in spain, anger and frustration boiling over as crowds threw mud, objects and insults at king felipe vi as he and the queen toured the town in the valencia region hit with historic flash flooding that killed more than 200. spain is bracing for more heavy rain today. kelly, it's not just in spain. it's all across much of europe. back to you. >> because of the mediterranean. it's crazy. tyler mathisen. the ai perplexity has a dedicated election hub promising answers from polling looks to election results and it's a high-stakes tech at a time when other big tech names are steering clear. deirdre bosa has more on today's tech check. >> an election cycle and that isn't new. what is new in the age of generative ai is inaccurate information in the authoritative

tone of chat bots which can leave users, and despite the risks, users are searching for election information in new ways through chat bots and start-ups like perplexity and open ai they're looking for a bigger piece of the traffic. it has 200 million weekly average users. in september and october it surpassed traffic in all of 2023. over the weekend, perplexity debuted an ai-powered election hub and it offers a streamlined user ente user interface with the associated press. reliability? it's not quite there. users have found information that is not up-to-date and memes and candidate profiles you can create ai-generated images and it's reminiscent of the social media election hub his of 2016. this is a screenshot of

facebook's hub, offering discussion, candidate discussion and similarities from what we've seen from perplexity over the weekend. this time big tech learned their lesson and they're adopting a more cautious approach after criticism of the platforms warned of disseminating information eight years ago. this time around they're largely deflecting voter questions to other websites. so you are seeing that those more nimble, perhaps more to gain generative ai start-ups, kelly, leaning more into the election this time around and we will not know the implication quite yet, but it is interesting. >> this would be a test of whether they can stay super current and to have either licensed or crawling the internet or the partnership with a.p. that you mentioned to keep it up-to-date is a whole other story, and people will probably want to ask it questions more like, you know, take the iowa or kansas poll or whatever. tell me the track record. what's the history, those kinds of investigate of and chatty

projects. if you're trying to google where a poll is, you should just google it. >> more diving into it more than anything else we've seen and even open ai isn't doing as much as perplexity and they have actual maps that they claim will show real time results through the relationship with a.p. is it going to work the way they intend and what kind of follow-up questions is it going to suggest and this is new ground and we'll have to see how it works come tomorrow night and they're risking it in a way that big tech just really isn't willing to in this election cycle. >> and may give us a glimpse of what real time information on those platforms will look like going forward. deirdre for now, thanks. deirdre bosa. coming up, the decking company trex had its best month since july for earnings and the ceo will join us next to break down the consumer and the health of housing. don't go anywhere.

welcome back. shares of the decking company trex is up about 10% since its earnings beat last week.

the anticipated slowdown in the lower end did materialize and that spending decline was offset by sustained demand for premium products. joining me now on a first on cnbc is bryan fairbanks, the president and ceo of trex. good to have you. >> thanks, kelly. >> how long have you been at the helm? >> i started right as the pandemic was starting in april of 2020, but i've had over 20 years' experience with the company? wow. you started in april of 2020. so business went from terrible to fabulous to now how would we describe it? >> it absolutely took off during that time period and there have been ups and downs as we work through inventory and the channel in a variety of times. today i would say it is kind of moderating and i thinkwe're coming out of a period where the consumer has been a little bit unsure about spending. repair and remodel spending has been negative over the last couple of years, but i do see that on the horizon we'll start to see some growth there again with consumers. >> do you watch interest rate as obsessively as i do because

every time i see it going back up. there goes the housing rebound. i guess the activity for homebuilders has still been strong and the stocks have been strong, but you need the broad housing market to have turnover, right? >> yeah. it's more important that we see existing home sales increase. with interest rates coming back down we should start to see more homes coming to the marketplace. everybody who moves out of a home will have a repair and remodel of that home and they should repair and remodel, so i do see tailwinds moving into 2025 and that should help drive that number. some of the traders and analysts are looking at the increase in pending home sales and that leads existing in the last couple of months and you can start to get a better cycle in 2025. when do you think that will materialize? >> any little bit of good news always helps, but i do expect that we'll start to see some of that benefit in '25. we're not just relying upon repair and remodel coming back. we'll go after the growth on our own and make sure we have the right deck boards in the

marketplace. we just launched two new colors and some that have been through the home sellers and more importantly, we've really leveraged our growth on railing as we move forward. we want to make sure that if a consumer is putting a deck that we have the railing to go lalon with that deck. >> really? >> we can double that market share over the next five years. >> that's so funny. what a tactical play. previously people would have put you on the decking itself, but not the railing project. >> railing is much like decking was 20 years ago. we see the same opportunity to bring the trex brand to the larger part of the railing marketplace and be a significant player. today we are the largest player in alternative non-wood railings. we see the opportunity to grow that immensely. >> does the outcome of the election tomorrow matter? i don't know if this product is fundamentally sourced from overseas or how it's made or whether it's a tariff risk or not a tariff risk. just talk about that a little bit.

how does that work? >> we haven't seen the difference in the performance of the company depending upon the administrations that will be in office and that's less important for our growth and we always look at our job to grow the company. it's our job to drive those valuations and we'll do that regardless of which administration comes in. >> absolutely. >> say there was an across the board 20% and does this come from china and new mexico. you name it, where does it come from? >> the vast majority comes from the united states and we have a manufacturing plant in virginia and one in nevada and a site in arkansas that we're excited about. >> you could be one of the beneficiaries of a less globalized world if we get that one way or the other. i just wanted to make that point. so if we look at now the consumer and how they seem to be faring, high end to low, would you describe bifurcation or what's going on there, and apparently in the quarter there is concern about low and spend. >> there's bifurcation, the high

end consumer and the premium products and utilizing contractors and we're continuing to see growth at that level. some of those entry level products and the products we designed to specifically go after conversion of wood. wood's about 75% of the market today and we see the opportunity toconvert a lot of that market, but that consumer is clearly struggling at this point. we've seen a low, single-digit type decline and as we move into next year we start to see the tailwinds behind us. we expect that consumer to come back, as well. >> that's the typical price of a deck for a customer? can you tell how much they're buying. >> an entry level project is between $10,000 and $12,000 and premium you can be look at $25,000 up to hundreds of thousands of dollars and just amazing backyard transformations. >> appreciate your time. bryan fair banks with trex. speaking of home and turning to the financial side of things, homeowners are sitting on a

record amount of equity and they're finally starting to tap in more and it could help with things like decks and diana olick helps us with new numbers. >> u.s. homeowners collectively are sitting on their 17 trillion in home equity, about 11 trillion of that is tapable according to ice mortgage technology and that's what happened in q3 when interest rates eased a bit. during the quarter mortgage holders withdrew $48 million, the largest volume in the two year since the fed started hiking rates. home equity lines of credits are tied to the fed's rate which, of course, they cut in september. so homeowners are still being pretty cautious, even with the gain they tapped just 4.2%, less than half in the decade leading up to the fed hikes. why? the monthly payment needed to take out a $50,000 he locked more than doubled from the low of $167 in march 2022 to $413 in

january of this year. now given the latest rate cut and another 1.5 percentage points of cuts expected through next year, that would drop the monthly payment to below $300. ice's chief economist said the past ten quarters homeowners have extracted nearly half -- half under what we would expect to see under more normal circumstances and that equates to nearly half a trillion in untapped dollars that have not flowed back into the broader economy, kly? >> and not to pound the drum, but it feels like it might come back to rates and it is not chief to take out a home equity line of credit. >> right. if we see the fed lower interest rates more that would make it cheaper to take out the home equity and it's a question of how conservative are homeowners today given the great recession and the great financial cries when people were under water. we're not using our homes as atms anymore and people are surprisingly conservative today.

diana olick, we appreciate it. >> coming up, ubs crunched the numbers and found this grocer to be up 1% and we'll give you the name next up 57% year to date. before we head to break, let's check the trump trade which is making a bit of a comeback this afternoon. shares of trump media and technology are now up 11%. they were down as much as 4% earlier. bitcoin, meanwhile, not quite green, but down 1.5% and similar for tesla, keep an eye on that while the 10ear el-yyid looks like it could move higher. "the exchange" will be back right after this. at all the benefits they're offering. everybody wants to build the best team and offering aflac can help attract and retain that top talent. you know we like that top talent. and listen, i mean you gotta listen. aflac gives employees cash to help with unexpected medical bills. it's prime time to add aflac.

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powering possibilities. comcast business. power's out. welcome back to "the exchange." consumers are still looking for the best bang for their buck when it comes to groceries. it's been a campaign issue. it's top of mind. and ubs knows just the place to find them. last month the firm analyzed prices of nearly three dozen food products across several grocery chains and found that

walmart's were anywhere from 10% to 23% lower than the likes of albertson's, kroger, target and amazon. our next guest says that price gap is pushing walmart's growth momentum forward. that stock outpacing competitors by as much as 28% this year. and it was our mystery chart. joining me is michael lassar, equity research analyst at ubs covering the food retail space. michael, how do they keep doing it and why can't other chains match prices or does it just not matter so much for them? >> well, kelly, 20% of all grocery sales in the united states go through walmart in one way, shape or form. so it has unmatched scale in this category that it uses to generate purchasing leverage in all of the areas that it buys. and then it hands over those savings to the consumer in the form of lower prices. so it's a phenomenal model that has been working well for a long time. and now it's turbocharging that by adding other elements to its

business model like advertising, third-party marketplace fees, membership fees. and this is providing further opportunity for walmart to invest in areas like price and further enhance the customer experience. >> based on your study you said a customer living in the denver area, that's where my sister is, we'll pretend it's her, spending $1,000 on groceries in walmart in october would have generated $100 of savings compared with target and $200 versus amazon. now, did you go to the likes of aldi and little? because that's where it also seems like there may -- maybe dollar general. some more peer to peer competition for walmart. >> well, in those cases, in the hard discount model, those are typically unbranded goods, more like private label products, and a much more narrow assortment versus walmart. so walmart's not on the providing a lot of the day-to-day products that consumers use regularly in their lives but also at very

compelling prices. if you want to get unbranded goods, private label products, as a consumer you can go and shop at one of those hard discount chains. but for dollar for dollar value right now walmart is amongst the leading players in retail. >> based on how well they're executing do you want to see them go further down the path of becoming an amazon competitor or would you prefer that they stick with what works? >> they are going to stick with what works. they're going to enhance the business model over time. and that's going to make walmart an even more formidable competitor to the likes of amazon and others in the marketplace. but its core business of selling inexpensive goods at a very good value to consumers is not going away. it's just going to enhance that with other revenue streams, expanding its assortment online, and it's going to make an already good value proposition to the consumer an even better value proposition. >> what do you think would have happened if kroger and

albertson's went through? >> well, in retail it is a game of scale. so having scale is important. but i would tell you that retail is a very competitive sector. day-to-day all of these players, whether it's walmart, amazon, target, costco and others, they're trying to take market share from other players in the market. so that's not going to change no matter if there's more consolidation or less consolidation in the market. >> all right. michael, as we leave it, how do you think this all kind of informs us about where the consumer is going into the holiday season and going into 2025? the labor market's held up a little better than expected. inflation is still top, top, top level concern. where do we stand? >> the consumer overall, kelly, is steady but choosy. and i think that what we're going to see over the next couple of months is that the consumer's going to focus his and her spend on value-oriented

items at a select number of retailers. anywhere between 40% and 60% of all incremental retail sales growth right now is being driven by combination of walmart, costco and amazon. and that is likely to continue for the foreseeable future. >> maybe your investing conclusions are obvious. do you just -- we talk about hyperscalers in tech. do you stick with the hyperscalers in food? >> i think you do stick with the leading players. they're going to gain a disproportionate amount of the profits in these industries. >> all right. michael, thanks for your time today. appreciate it. michael lassar with ubs. and that does it for "the exchange." in a rapidly changing dynamic today in the market between the betting odds for the outcome tomorrow, what the related stocks are doing. you can see the dow -- the nasdaq has now gone positive. the 10-year yield is almost higher on the day. tyler is getting rea fdyor "power lunch," and we'll pick things up on the other side of this break. has no idea she's sitting on a goldmine. well she doesn't

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welcome to "power lunch," everybody. alongside kelly evans i'm tyler mathisen. so glad you could join us. stocks are lower today to start off, well, let's call it a big week for the markets. big week for the country. maybe even the globe. but off the worst levels of the day. election tomorrow. fed meeting on thursday. so the agenda, kelly, is full. >> you know, i love watching this play out tick by tick. you can overlay the predicted odds or pick your favorite platform or whatever. the one you hate the l