does that mean for chinese investment? it could be significant. maria: could be significant, especially since they're not giving up. they want china to make sure they promised that autonomy stays. we'll see. great show. great to have you. thanks so much. have a great day. "varney & company" begins right now. stu, take it away. stuart: good morning, maria. good morning, everyone. consumers to the rescue. full employment, rising wages, yes, we have money to spend and we are spending it. you are a real source of strength. the immediate beneficiaries are the big name retailers. even supposedly out of favor department stores like nordstrom are reporting much better results. look at dick's sporting goods, still racking up sales gains even though they no longer sell some types of gun. look at the stock go up. the strength of consumer spending has been clearly demonstrated this month. home depot, lowe's, walmart, target, big names, all, all doing well and all suggesting that tariffs can be managed.

yes, it is now a consumer-driven economy. we do want to alert you to new protests in hong kong. nothing major so far but it's just 9:00 at night over there and protests generally pick up steam in the hours before midnight. we cover this because these protests are a wild card in the china trade talks. they could affect our market and because we respect the courage of those youngsters demanding freedom. now this. there you go. which is the real elizabeth warren? take a long, hard look. i couldn't tell but we will let you know who is who on the show a little later today. and watch this. this is another internet optical illusion. take a long hard look at this one. is that a bird or a bunny? be quiet, ash. to me, it's clear. but our production crew was split. how unusual. we have a big show and it's on

its way for you. "varney & company" is about to begin. i am the chosen one. somebody had to do it so i'm taking on china. i'm taking on china on trade and you know what? we're winning. because we're the piggybank. we're the one that all these countries including the european union wants to rob and takes advantage of. stuart: all right. that was president trump talking china, the chosen one. more on that in a moment. but listen to what the president said about the federal reserve. roll that tape. >> i don't demand it but if he used his head, he would lower them. he raised interest rates too fast, too furious. now we have to go the other direction. we'll see if he does it. if he does it, you'll see a rocket ship. the federal reserve has let us

down. they missed the call. they raised them too fast. they raised it too high. and they did quantitative tightening. they shouldn't have done the tightening and they shouldn't have raised them to the extent. stuart: moments ago, president trump added to that with a tweet. here it is. germany sells 30-year bonds offering negative yields. germany competes with the usa. our federal reserve does not allow us to do what we must do. they put us at a disadvantage against our competition. strong dollar, no inflation, they move like quicksand. fight or go home. okay. spell it out, mr. president. herman cain is with us, former chair of the kansas city fed. what do you think, herman? with all this pressure, will powell bow to that pressure and cave? what do you think? >> no. i don't believe he will. the fed has demonstrated its independence and they also demonstrated that they are slow to act. people forget that the u.s. economy and the world economy,

they are both very complex. so when you move one metric, it doesn't necessarily signal one thing or the other. now, that being said, if powell and the fed were to lower rates, it would benefit the rest of the world, because u.s. dollars would be cheaper. that should be their focus, not necessarily the focus on how do we boost this economy from 3.5% to 4%. stuart: i asked you if jay powell would cave and bend to the president's pressure. by that, i meant is he going to cut rates dramatically like 50 basis points. you said no, he's not, he won't cave to the president. he will remain independent. but would he cut like 25 basis points, a quarter point here, and another quarter point later? and another quarter point at the end of the year? that's not exactly caving but it's certainly lowering rates dramatically. >> that is a much more likely scenario in my opinion, what you laid out. if you look historically, it was

rare that the fed would either lower rates by more than 50 basis points or raise it. they would do it in .25 increments. so your scenario i believe, stu, is much more likely. stuart: okay. that will be good for our economy, will it juice it just a little? >> it would be great for our economy. stu, it's amazing what cfos can do with a 25 basis point cut in the cost of money. remember, we have a lot of companies already where their market currency is way higher than it's ever been. so they get a 25 basis point cut, they can do a lot of things. remember, if you look at business investment, that is the one metric that has sort of flatlined even though we have all of this other good news. stuart: okay. herman, stay there, please. more for you in a moment. look at the big board, check futures. the dow is going to be up a little more at the opening bell, maybe 60 points.

it's up, what, 1% this week as of yesterday's close. up again this morning just a little. a second item for your attention. that recession signal, the inverted yield curve. what we've got now is a no inversion. the ten-year yield's above the two-year and that's the way it's supposed to be. that's probably helping the market, too. okay. retailer dick's sporting goods, that stock's going to be up big. it reported better sales and raised its outlook for the rest of the year. it is still evaluating whether to get rid of guns entirely. the stock's going to be up 6.5%. now look at this one. nordstrom and victoria's secret parent l brands, they are also up today on strong numbers. look at nordstrom, that's a department store, up 8% premarket. ashley: remember those? stuart: l brands was up earlier. something must have happened. now it's down 4%. we will deal with it. joining us, market watcher scott martin. these numbers from the retailers

generally suggest that the consumer is back and back strong. is the consumer leading this economy? what do you think? >> yes. thankfully, they are, because the consumer's about 70%, 7-0%, sports fans, of the u.s. economy. to say they are important would be an understatement, right? it's great news to see this, stuart, as we saw with some of the walmart numbers recently. we've got costco numbers coming out in a matter of weeks. those should be very good. it's really interesting, though, to see how the consumer's feeling based on some of the metrics in their lives. give you a couple examples. housing market, housing prices, average home prices have been relatively strong in most areas. that's making consumers feel good. 401(k), ii.r.a. balances with the stock market at or near all-time highs is helping the spending mechanism get going for the consumer so when they feel good about their home which for most of us is our biggest as set on our balance sheet and your 401(k) is up year over year,

that's when you go to the store and spend money in your wallet. stuart: thank you very much. ashley, you have some news? ashley: wells fargo downgraded l brands but l brands says look, we are focusing on victoria's secret and getting that product line up and running a little stronger than it has been. stuart: earlier this morning, l brands premarket was up. then we got this thing from wells fargo. ashley: down. stuart: there's a problem here with victoria's secret, their sales are down 7% year on year. that's not good. ashley: correct. stuart: now are now down 4.5% premarket. let me get back to herman cain. cory booker took a shot at joe biden. roll tape. >> the next leader of our party can't be someone that is a safe bet, oh, let's just find the person that can triangulate and get this done so we can beat donald trump. i'm running in this election because i know we can do more than that. stuart: herman, biden has been criticized for his energy or lack of it.

in your opinion, can he stay the course? >> no. he can't stay the course. if you look at history, safe bets have never won the presidency. secondly, a safe bet is not a leader. this is why they hate donald trump so much. he is not a safe bet, he is a leader and he is showing it in some of the policies that he's put in place so i don't believe joe can stay the course. even if you were to ignore all of the gaffes, and you know a lot of people are not going to ignore all of the gaffes, i don't think he has the energy or the intellect to beat donald trump. stuart: ouch. herman cain, thank you for joining us. see you again soon. thank you very much. >> you want me to tell it like it is. that's what i do. stuart: you always do. that's why you're on the show. thanks, herman. >> thank you, stuart. stuart: the united states and venezuela reportedly holding secret talks but ash, are these talks all about maduro and whether he stays or leaves?

ashley: yes. they are trying to do this in a way by negotiating essentially to push maduro out, then that would clear the way for free and democratic elections. that's the whole point. apparently we are talking to high level officials in venezuela including one of maduro's powerful lieutenants saying look, we need to handle this, you move on, democracy comes in. apparently according to some reports, venezuelan leaders right now want to make sure there is no quote, retaliation, persecution or violence and they also, we are told, want to stay in venezuela and participate in those democratic elections. they're not just going, i'm not so sure the u.s. wants to do that. by the way, maduro went on tv the other day and acknowledged these talks and said we have had secret meetings in secret places with secret people that nobody knows. stuart: give him $100 million and a jet full of people and he's gone. get him out. we'll see. check futures. we will be up, not much, 55 points for the dow industrials,

about 10 for the nasdaq. the 2020 democratic field got smaller. jay inslee dropped out. a sign that his climate change agenda, he was a one-issue guy, had very little impact on the race. he is out. president trump's re-election campaign launching a new effort today to attract suburban women. recent polls show that is going to be an uphill battle. we have the trump 2020 campaign on the show in our next hour. the president says he is the chosen one on china trade. i want to know what the chances are for a modest intermediate deal with beijing. that would be stimulus. that story's next. brokerage accounts. and zero minimums to open an account. at fidelity those zeros really add up. ♪ maybe i'll win ♪ saved by zero why accept it frompt an incompyour allergy pills?e else. flonase sensimist.

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stuart: amazon is expanding its amazon fresh service to houston, minneapolis and phoenix. this is more action in the delivery wars. amazon stock premarket up five bucks. washington's governor jay inslee has dropped out of the

presidential race. he was all about climate change. ashley: that was his main issue, to be honest with you. he also butted heads with the democratic national committee, demanding the debate be held just on climate change. they pushed back even though now, cnn will be holding a debate on climate change. bottom line, he resigned but he wouldn't have qualified for the next round of debates anyway. you have to have a minimum of 2% in four recognized polls and i don't think he was going to make that anyway. stuart: got it. he's out. ashley: out. stuart: to the trade war. president trump calls himself the chosen one. says he's the guy who can take on china. all right. robert davis with us. he's with the kissinger interstate on china and united states. welcome to the program. the president says i'm the chosen one. by that i guess he means i am the only president who can do anything with china. what do you say to that? >> i don't think he's the only president who can do it but he has done it and it is true that u.s./china trade, financial

investment relations were overdue for a major rethink and overhaul which was destined to be confrontational in some form. and he has certainly been confrontational. if that's what he means by being the chosen one, it's happening on his watch, then that's true. stuart: okay. now, what are the chances of what i'm going to call a low level intermediate trade deal in the fairly near future? by that i mean china buys a ton of our stuff and we either reduce or cut tariffs completely? that's a minor league deal but what are the chances of that happening? >> i think the chances are still fairly low. that's the kind of deal that previous presidents have arranged with china time and again. i think that china would insist on fully equal treatment with the united states and probably they would want all sanctions taken away. we are simply not prepared to do that. we have asked for major changes, structural changes to the chinese economy that really amount to a change in the mode of governance in china. this, the chinese communist party is not ready to do.

if the president took your intermediate deal, furthermore, he would be under tremendous pressure, bipartisan pressure including from leading senators in his own party, who would see this as backing down to china and as a return to the way we have done business the past several decades. stuart: you sound like there's not going to be a deal in the foreseeable future, a real deal. that your position? >> it is. i think the only thing that could change that is the president's domestic u.s. political calculations. if the stock market had a serious and sustained downturn, if the signs of an imminent recession became far stronger or if some of his supporters, especially the agricultural sector, started to turn against him because of the tariffs, then he might recalculate because of 2020. but for now, i see him staying the course and china is not feeling as much pain as the president says and is in no mood to back down. stuart: your position is odds are really against any kind of

deal, real deal in the immediate future. you're nodding vigorously. okay. got it. thanks for being with us, sir. appreciate it. back to futures. we are still going to be up about 50 points for the dow industrials and about six for the nasdaq. slightly higher at the opening bell. now this. i keep looking at this. you got to look real carefully. elizabeth warren, seeing double on the campaign trail. face-to-face with a look-alike. can you spot the real elizabeth warren? i had a real hard time with this one. we will reveal the answer for you next. there's a company that's talked to even more real people

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passing legislation this year guaranteeing working people like every other industrialized country in the world, two weeks paid vacation every year. ashley: alvin the chipmonk. stuart: a tad awkward there. an audio glitch changed his voice, obviously. he was doing a livestreamed appe appearance. his plane was delayed, he couldn't get there and he turned to skype. that's pretty bad in a presidential candidate, if you ask me. this is serious stuff, elizabeth warren photographed with someone who could be her

twin. okay. look at that. look at that. can you tell? this photograph was taken in minnesota. let's study it long and hard. ashley: i couldn't tell. i had to look it up. i cheated. stuart: it is? ashley: the imposter is on the left in the blue blazer. she had the blond hair, glasses, the blue blazer, everything. it's remarkable. it's funny because stephanie said it got weird very fast when she showed up to this event. she said i talk with my hands and shake my head just like elizabeth warren which only made me look more like her. i was saying i'm not her. but i could have been saying medicare for all. stuart: isn't it nice to have a little humor in the campaign. ashley: that's remarkable. stuart: we've got another one for you. this has got the internet puzzled all over again. look. is that a bird or a bunny? i know exactly what i think. what's the real answer?

ashley: i can see both. but the answer is a bird. stuart: it's a bird. ashley: an african white-necked raven. stuart: how can anybody see a rabbit? ashley: you can see ears. now it's like he's rubbing the nose of the rabbit. stuart: i've got it now. okay. now it looks more like a rabbit to me. ashley: optical illusion. stuart: it is. it's not a beak. it is a beak. ashley: it is. stuart: it looks like ears. ashley: correct. the more you look at it, the more it becomes a bunny. stuart: right. ashley: but it's not. stuart: the show has a friday feel to it even though it's thursday. light relief from the subject of money. on that subject, show me this. the big board is going to be up. by the way, there's some talk about the inverted yield curve again. that's a little different from the bird versus bunny suggestion. look, we are up 40 points for the dow industrials because we

are no longer inverted. that's a big factor. ashley: inverted bunny. stuart: long-term yields higher than short-term yields. that's the way it's supposed to be. the market likes it. we will go up. all right. enough of this. back in a moment with wall street. hey, who are you? oh, hey jeff, i'm a car thief... what?! i'm here to steal your car because, well, that's my job. what? what?? what?! (laughing) what?? what?! what?! [crash] what?! haha, it happens. and if you've got cut-rate car insurance, paying for this could feel like getting robbed twice. so get allstate... and be better protected from mayhem... like me. ♪

i'm not looking at a tax cut now. we don't need it. we have a strong economy. certainly a payroll tax cut, president obama did that in order to artificially jack up the economy. president obama had zero interest rates. i don't have zero interest. i have real interest rates. and despite that, i have a strong economy. stuart: ashley, wait a second, that is a reversal. ashley: it is. stuart: he says one thing on day one and kind of just throwing it out, then day two, reverses it. ashley: basically, the line now is that the economy is strong, we don't need these tax cuts. but the white house is saying that look, the president just threw it out, he was just throwing things out as a potential possibility. none of this was meant as definitive. it's like why don't we do this, why don't we do that, we don't need it. stuart: like what if we buy greenland. ashley: why not. stuart: everybody laughs and

moves on. we're moving on. the opening bell -- thank you, ashley. the opening bell rings in ten seconds. it's ringing now but we start trading in about seven seconds. we are going to go up for the dow, s&p and nasdaq, but not that much. here we go. it is thursday morning, 9:30. we're off and running and how do we open? not bad. up 64 points. i wasn't expecting that but we'll take it. yeah, 60 odd points for the dow industrials. let's summarize like this. it's up about a quarter to .33%, stronger gain than we were expecting. the s&p, where is that in the first few seconds? up a quarter percentage point. the nasdaq composite, pretty sure that's on the upside. yes, it is. a quarter point higher. here's the important one. the ten-year and two-year, what are they yielding? this is the yield curve. right now, no inversion. the two-year yields 1.59%, the ten-year yields 1.60%. that's the way it ought to be. any impact on the price of gold?

yes, down six bucks at $1509. michelle mckinnon is here, joel shulman is here and so, too, ashley webster. let's talk big name retailers. they are putting up some good numbers. the latest, dick's sporting goods and nordstrom. both of them out this morning. both of them, i'm pretty sure, going straight up this morning. michelle, my point is, it's the consumer who is rescuing retail and not exactly bailing out but definitely supporting department stores. they are supporting the economy. >> absolutely. stuart, this is so important. the u.s. economy, two-thirds of the u.s. economy is the consumer. as long as we can continue to see a very strong consumer, i'm very positive and optimistic of the future. if we see a break in consumer confidence, i might be a little bit worried. stuart: nordstrom up 7%. dick's sporting goods up 9%. but i see l brands down nearly 9%. joel, weigh in, please. what's wrong? >> victoria's secret is down about 62% in earnings from last

year. they have had a decline for a couple years now. the stock is still negative despite the fact the s&p and other large companies are up. we are looking at other retailers like target yesterday -- >> nordstrom. >> walmart. we are seeing lots of strength among retailers in general. this is about a 40, 45-year-old company. we often find consumer companies, particularly strong growth entrepreneurial companies after 40, 50, 60 years, they start to decline. this is one of those things they need to rebrand, reboot. of course, the ceo has other bigger problems with some of the controversy. stuart: leslie wexner had a financial relationship with jeffrey epstein. is that a problem for the stock? >> it's certainly a problem for him. he's the largest owner of the stock. certainly that's going to weigh in. to the extent there's going to be impropriety traced to him and his company that will leak out bad news daily for this company. stuart: let me alert you, because the dow is up triple digits. wasn't expecting this. maybe it's the non-inverted

yield curve that's helping. we are up 110 points. now, two items of news on apple. number one, they are getting ready to release camera-focused pro iphones. new ipads, and a larger mac book pro. why is that important? is that a big deal, ash? ashley: i kind of think it is. look, it's always the same question. are the changes being made to the iphones which a lot of people focus on, are they enough to make you want to ditch what you have and upgrade. that's always the big question. the iphones, they are going to have these extra cameras on the back that will allow you to pull further back and get a wider perspective. there are people who love that. it could be enough to push some people into it. we are going to get, this basically will replace the xs and xr will also be replaced. there is this constant upgrade. it's always a question of whether the upgrades are enough to get people excited. stuart: president trump seems to have a pretty strong, i say a good relationship with apple's chief tim cook.

is that helping the stock? >> i'm not sure that necessarily is going to drive the stock. we have seen other situations where he's really hurt the stock. to ash's comment, regarding this phone, it's really becoming more of a kacamera than a phone. i think the big breakthrough which has not come out yet is the 5g. that will be a monster increase. to the extent they keep tweaking improvements on the camera and they say the next version will have almost professional quality pictures, that's going to be a big deal for the consumers. stuart: quick word? >> i think it's a bigger story of you are finally starting to see ceos really start to talk to trump about trade. because they are continuing to see this as an issue and will trump bend to maybe some of these ceos? he might. stuart: he might. we've got that intermediate deal i have been talking about. >> that would rally the market. you might see that. stuart: we shall see. might, might, might. >> one other comment. if you look at apple sales they

don't break it out by product but if you look by region, china was actually bigger a few years ago. they dipped down and have come back modestly. this could be a big deal for apple with respect to china. they were higher three, four years ago. stuart: now, there's another story here, not about apple, about car makers. president trump has taken a shot at them after they have ignored his emissions proposals. they have made -- the car makers have made a deal with california for stricter emissions standards. let's take the big picture for a second. michelle, would you recommend that any investor buy the shares of a single stand-alone car company? gm, ford, chrysler? >> a couple things. you've got the car companies trading at much lower discounts to the s&p. they are yielding a better dividend. i like those things. would i recommend my clients, no. how we own it, we own it via an etf. i think it's important to have those car companies in your portfolio. i will say this. i think the car companies are smart here because what happens

in two years, four years, we have another president and emissions standards are a lot harder, they are doing what's in the best interests of their clients and stockholders, they are trying to get ahead of the curve because they have been absolutely behind the curve and that's why tesla and other companies are coming up very quickly behind them. stuart: right now, the auto makers, all of them except toyota are on the upside. you better check that big board. look at this. up, down, over, 130 points. that puts us at 26,340. whatever losses there were last week, they are all behind us now. we are at 26,300. tesla, the stock is up three or four bucks this morning. volkswagen denies a report that its ceo is interested in a stake in tesla. okay. tesla is up three bucks. game stop, video game retailer. laid off more than 120 corporate staffers. that's about 14% of their corporate jobs. the stock is up 18% on that. higher profit at bj's wholesale. market loves it. 13% higher.

and the spam maker hormel, they make more than just spam, okay, reformed their nice outlook for the future. the stock up 1.6%. we should stop laughing. i was born and raised on spam. ashley: i was, too. stuart: you were, too. the americans shipped the stuff over to england. spam, spam, spam. i'm a spam man. at this point, $10,000 per coin for bitcoin. price of oil, i like to look at this. we are at $56 a barrel and the regular price of gas, national average, $2.60. that's all you got. down for 20 straight days. atom wilson says in a "new york times" op-ed that you can save capitalism by paying people more. i happen to wildly disagree with that but what's your opinion? >> well, a couple things related to this. there are two pieces to this. one is paying people more and

two is hiring more people, not firing them. so to the second point, i think that's the big issue for the 2020 election. who is going to help us grow our economy and create jobs. our entrepreneurial companies that we track are growing at 14%, the non-entrepreneurial companies grew 3%, 4%. we have 1.4 trillion pending of new m & a deals and 5800 deals. many of these companies are firing. so when you look at the big companies who are coming in and trying to improve corporate profits, so the flipside is many big companies now because of low interest rates, whether the two year, ten year, they are still going forward with m & a. so when we look at this, we are seeing a lot of layoffs and i think that's the bigger issue. you can always say pay more but the companies are driven to create value for the shareholders. shareholders are going to say pay the people market prices and you can cosmetically -- ashley: the business roundtable says no, pay everyone more. it's the socially responsible thing to do. >> wall street changes and they are actually fine with seeing

higher expenses because of higher earnings, sure. is that going to happen? i don't think so. stuart: can i just throw this out? may i just say this? ashley: spam man. stuart: you're killing me. you're killing me. if you let me keep more of my money instead of paying more than 50% in income taxes to government, you let me keep more, i will create far more jobs than the government will by giving it to them. don't contradict me. >> i want to be invited back. >> i'm agreeing, i think creating jobs is the thing. now, what's interesting is many of these executives at the roundtable was talking about paying people more. the ceos are paying themselves more. we talked about this. the ceos have access to the boards, are saying pay me more so we are seeing many executives in our country making north of $100 million, in some cases $700 to $800 million over three years. some are making $800 million in three years. stuart: i'm not jealous. that's america. it's a wonderful thing.

aim high. >> yeah. stuart: i know you're not with me. >> the reason being because the person who gave himself or herself $800 million over the last three years also sold 80% of the stock. hold on to the stock. it's worth about $1.3 billion. don't sell the stock. pay whatever, hold the stock. stuart: i think we agree to differ. we will see you next week. 9:40. sorry, guys. michelle, joel, thank you very much indeed for joining us. let me quickly go to the big board. you will like what you see. we are up 156 points, almost .66%. that is a rally. we were not expecting it. maybe this inversion thing because the yield curve is not at this moment inverted. one billionaire going under cover, trying to prove that he can build a million dollar business from scratch in 90 days. he started with just a hundred bucks. that was seed money. he's on the show at 11:00 this morning. on the show.

san francisco rolling out new softer language for referring to criminals. words like offender and addict. they use words more like just e justice. a behind the scenes look at dysfunction in d.c. washington has descended into tribalism and identity politics. i want to know, will having more business people in office help us out? that's next. we trust usaa more than any other company out there. they give us excellent customer service, every time. our 18 year old was in an accident. usaa took care of her car rental, and getting her car towed.

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eliquis is proven to treat and help prevent another dvt or pe blood clot... almost 98 percent of patients on eliquis didn't experience another. ...and eliquis has significantly less major bleeding than the standard treatment. eliquis is fda approved and has both. don't stop eliquis unless your doctor tells you to. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. if you had a spinal injection while on eliquis call your doctor right away if you have tingling, numbness, or muscle weakness. while taking eliquis, you may bruise more easily... and it may take longer than usual for bleeding to stop. seek immediate medical care for sudden signs of bleeding, like unusual bruising. eliquis may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or dental procedures. what's around the corner could be surprising. ask your doctor about eliquis. stuart: not quite the high of the day but we weren't expecting a rally like this.

up .66%, 168 points. maybe it's that yield curve thing again. look at l brands, really falling now, 11% down. that's a loss of two bucks. it's at $17 a share. sales slump at victoria's secret, wells fargo doesn't like the stock. down it goes 11%. switching gears entirely, now book about washington to tell you about. joining us is the author of the book "the gop's lost decade, an inside view of why washington doesn't work." former republican congressman, jim renacci of ohio, wrote the book. he's with us now. all right, jim. we can go on ad nauseam about the problems in d.c., tribalism, et cetera, et cetera. wouldn't it help if we had more business people in office? >> well, absolutely, and we did. in 2010, a number of business people came in, most of them left and that was the problem because there's dysfunction causes people to get frustrated and leave. that's what i found after even eight years in washington.

we had a good class of business people coming in but again, washington is dysfunctional because it doesn't operate like a business. stuart: you were a business guy. >> absolutely. for 30 years. stuart: you made your fortune in business for 30 years, then you went to congress. why isn't it, why couldn't your talents be employed? >> well, because in leadership, many times in leadership, if you look, there are not business people who are running congress. the issue is, i said this all along, if you ran congress, if you ran a business like you ran congress you would be fired. if you were the ceo or cfo of a business and it continued to fail and fail and fail, you would be fired and you would inject people in who could change things. the problem is, we don't do that. stuart: but if you ran congress like a business, you would be out of office, wouldn't you? it's hard to take, isn't it? >> if you ran congress like a business you would be balancing budgets, it's a lot of what i talk about in the book. we have to get back to basics. stuart: hold on a second. if you ran congress like a business, people like you would be saying do this and do that and get it done. >> right.

stuart: but you can't do that in politics. you have to take care -- don't defend anybody, say the right thing, be nice. >> that's one thing good, that's why donald trump was elected president because he was going to change things. he has found that washington, he has to work with congress, but in the end, congress should be working for the american people. we should be making those changes and too often, we talk about the people on the left and the right, there are so many good people in the center that aren't getting the attention needed. but in the end, there are so many good policies that don't even make it to the table. i talk about those in the book. too often, leadership is so worried about keeping their power, they forget about getting the job done for the american people. stuart: not so much ideology, just retaining power. >> retaining power. stuart: isn't that what politicians are all about? >> well, i learned that in the eight users i was there. too often they are worried about maintaining power. i don't know how many times i heard from both speakers, we can't do this because we will lose the majority. stuart: of course. yes. that has to be their first concern, doesn't it? it has to be. >> look at nancy pelosi.

i disagree with many of the things she passed but she passed a couple things, she set some example, she lost the house, she was not worried about keeping the majority, she got principals taken care of and eight years later she's back in power. i say that in the book as well. here's a leader who wasn't afraid to lose the majority, put some bold ideas out there, got things passed, lost the majority over it and now she's back in power. stuart: do you miss it? >> i don't miss -- look, i miss my friends in washington. i miss trying to get some things accomplished. but as you see in the book, i think i get more done from the outside. stuart: we shall see. jim renacci, good to see you, sir. thank you very much. we will see you again. >> you will. stuart: check the dow 30. we are still up triple digits. we have come back a little bit on the market. we have 27 of the dow 30 in the green. they're up. the dow is up half a percentage point. next case. plant-based foods all the rage these days. next, we have the ceo of a

company that's really cashing in on the trend. they set a target of more than quadrupling their value in the next three years. they want to get $2 billion worth of sales. they've got about $250 million at the moment. ashley: that's a lot of plant food. stuart: the new york city air show happening this weekend. the navy's blue angels, the air force thunderbirds and the royal air force, that's the brits, their red arrows are helping kick off the festivities. just flew in formation over the statue of liberty, trailing red, white and blue smoke. this is just moments ago, new york city. i'm in a studio. i missed it. we'll be right back. from the couldn't be prouders

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stuart: holding on to a gain of half a percentage point. the dow is up 135. okay, look, we talk a lot about the plant protein craze and healthy eating. talk a lot about it on this show. joining us now is the ceo of a nutrition company that wants to quadruple its value in the next three years. james mcmaster is the ceo. they make plant-based nutrition shakes and energy bars. sir, welcome to the show. james, your value at the moment, we understand is about $250 million.

private company, $250 million. you want to go to $1.25 billion in three years. that is a very ambitious target. how you going to do it? >> hi, stuart. thanks for having me on the show. so we started four years ago in the uk and branched out very quickly since then. we are an e-commerce business and we now sell to over 80 countries around the world, the u.s. and the uk in particular are two of the larger countries. we just hit a really big milestone of 50 million meals which is phenomenal, so we are doing a lot of things right and growing very quickly. stuart: so you think this move to plant-based food is strong enough for you to quadruple your -- the value of your company? quadruple in three years? strong enough? >> if you look at what's going on in the world, there's a lot of knowledge now in plant-based eating. you guys have covered beyond meat quite a bit. i think two key drivers what's happening. firstly, there is a greater awareness of the environmental

impact of eating meat. if you move to a plant-based lifestyle, you reduce your carbon footprint by 75%. the second thing that's happening is there's a great awareness of what happens to your body from high meat and dairy consumption with meat in particular. every day, there's very strong links towards cancer and cardiovascular disease as well. the move towards plant-based lifestyle is goonly going to gr. stuart: here's the question a lot of people ask me when we do this kind of interview with plant-based food. what plants do you use for your food? just tell me. >> so we, huel is made up of oats, peas, rice, flaxseed, sunflower and coconut. that's the core of our recipes. stuart: that's it? that's it? >> we add in some supplementary vitamins and minerals. effectively you could live off huel. it's got all the protein, fiber, fatty acid, carbohydrates and

all 27 vitamins and minerals your body needs to live off. stuart: before we close, i have 20 seconds, why is it that so many brits are vegetarians or oriented towards plant-based food? why you? >> i think it's a global thing, actually. in markets like india, 25% of the country is vegetarian. we are seeing a definite global trend on the move towards vegetarianism and vegan and people having one or being plant-based to reduce their impact on the world. stuart: congratulations on your current growth rate. we wish you well in the future. come see us again. james mcmaster from huel. thank you, sir. appreciate it. president trump signs an executive order canceling student loan debt for disabled veterans. all right. how many disabled veterans does that apply to? ashley: it's permanently disabled veterans, individuals who have received permanent disability. there's about 50,000, stu, that have student debt and with this signing of the executive order,

the president has wiped out all of their student loan. there is a program already in place called the pt or tpd, total and permanent disability discharge, but apparently the program is so complicated and so difficult to navigate, half the people that are eligible for this just can't figure it out. this in one fell swoop wipes out the debt. it's a good thing. stuart: do it. thanks, ash. in our second hour which is coming up, the challenger to congresswoman ilhan omar, republican lacy lee johnson will join us. here's the question. how can he win when the voter base in that district is very sympathetic to representative omar? 10:40, the challenger is on the show. democratic 2020 candidate jay inslee dropped out of the race for the white house. maybe the economic fantasy known as the green new deal put voters off. that's what i think. that's my take coming up at the top of the hour.

check that big board. seconds away from finding out the latest read on mortgage rates. could they be getting lower than last week? i think they are. we will tell you the numbers after the break. ♪♪ ♪♪ ♪♪ . . but perhaps this year, a more exhilarating endeavor awaits. defy the laws of human nature,at the summer of audi sales event.

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stuart: 10:00 here in new york. it is a thursday. at this time, it's mortgage rate thursday. so ash, the number? ashley: edge of the seat stuff. 3.55%. stuart: oh. ashley: just down a hair. it was 3.6%, threw his pen down in disgust. we thought it would go down lower than that what we see with the treasury yields. 3.55%. i will say home purchase demand is up 5% year-over-year. refinancing hit a 3 1/2-year high. so a lot of people taking advantage of these low rates, saving average of second quarter of 1700 a year or 40 bucks a month t adds up. stuart: if i was thinking of refi-ing i would wait a wail.

i'm convinced mortgage rates will come down some more. i've been wrong in the past. i'm wrong now. ask the question. >> how low do you think mortgage rates are going to go? 3.3 is the all-time low. stuart: i don't know but i stayed in a holiday inn express. let's get to the story because i can't answer the question. interesting side-effects of lower mortgage rates, that the risky mortgage is making a comeback. tell me more. lauren: not called subprime. it is called non-qualified loans. there are only some prime borrowers. $45 billion were originated to this group of borrowers, don't have the best credit score or self-employed, can't show bank statements and pay stubs. they can buy a house, participate in the housing market. it is on riskier side but not like the financial crisis. stuart: not that you have liar

loans, you didn't have to declare income payment and give you a check. we're not back to this, are we? >> we're not back to that. the rates in a class of borrowers are little higher. they're not getting 3.55% rate but maybe 5%. stuart: lauren, we had the news two minutes ago, no, three -- ashley: 3.55. stuart: 3.55%. getting a little old here. 3.55% on 30-year fixed-rate loan. you're looking at the response of the stock market which is zero. we're still up 128 points. and, now this. jay inslee has dropped out of the presidential race. he had run entirely on climate change but had very little impact. this tells us a lot about the climate issue in politics. number one, it is not resonating with voters. despite all of the reporting on extreme weather, climate is way down any list of voter concerns. now i'm surprised at this.

it has been 13 years since al gore released his climate movie, "an inconvenient truth," which brought maximum publicity. we've seen intense reporting of climate extremes for a generation but little voter response. why? perhaps the economic fantasyland known as the green new deal put people off. the greens went over the top. when aoc and senator markey released the plan it was widely ridiculed. get rid of air travel. no fossil fuels. government inspectors for every building in the land. no wonder it was laughed at. rational, sane, american voters were not on board. jay inslee could not change that he is out of 2020 race. climate action has a poor record with voters. they're not buying it. not signing on. even in super green washington state where jay inslee is the governor, voters rejected by a wide margin, a ballot measure to tackle fossil fuels.

it would have taken a billion dollars a year out voters pockets. the point is, voters will not sacrifice now for climate virtue in the future. they are very reluctant to change their lives dramatically, to save the planet. maybe should pay more attention to america's success. it hardly get as mention in the media but america has cut carbon emissions more than any other industrial society. we did it largely by using natural bass to generate electricity. here's a suggestion for the greens. accept nat-gas. we have a ton of it. it is cheap, it produce as lot less carbon. ah, but it's a fossil fuel, that is just plain wicked, isn't it? bottom line, if you want to fight climate change, you better come up with a policy that works rather than scares. come on in matt makoviak. matt, inslee is out.

i say voters are not just buying climate change solutions. what say you? >> yeah. i think on the far left their voters are very mobilized and motivated about the issue of climate change. and look, inslee's presidential campaign may have come to an end, but his ideas, energy behind that on the far left will remain. if you look at proposals that elizabeth warren embrace, sanders, others put out in climate change, even beto o'rourke, they're not that different from what inslee proposed. look when you are a -- stuart: here is my premise, matt. here is my premise. that voters will not will not pay more for energy, will not sacrifice now for some perceived climate gain in the future. that's reality. not just climate change message, what they're proposing. very rarely to people actually folk on what they're propose.

you talked about the green new deal will not sell in the rust belt. this presidential election will be determined by wisconsin, michigan, pennsylvania. you have, you have coal in those states. those states are very energy reisland. agriculture, i mean you go down the list, you will not want to move in the direction of the "green new deal." these are ideas very popular on the coasts in wealthy areas like washington state, oregon, california, new york. they are not popular in the middle of the country. you pointed out, we are using innovation to reduce our emissions. we're down to something like 2002 levels of carbon in the united states. we've done that not with mandates, not with taxes. not with new schemes but with innovation. stuart: i have to repeat again, there was a proposal for a carbon tax put on the ballot last year, 2018, november. in washington state, which i think of as an uber-green, kind of place, it is inslee's own state. it loss by 13 point margin. writing is on the wall.

they won't go for it. last word to you? >> that's right. if you know, if you're being serious about climate change, you want to reduce carbon you have to talk about increasing natural gas which you pointed out, utilizing nuclear which france uses, other countries use safely. the idea that people are going to pay higher electricity rates, higher gasoline rates, for some you know, imperceptive advantage or benefit to the climate when this is a global problem, i think it is not a political winner. if democrats want to make this nair number one issue in the 2020 election, republicans will welcome it. stuart: i don't think they will make it the number one issue. that is the story. matt, thanks for joining us. see you soon. >> thank you. stuart: let's get straight to the money. we lost the triple-digit gain. we're still up 95 points, that is 1/3 of 1% as we speak. michael o'keefe is with us. michael, welcome to the show. >> oh, thanks. stuart: i don't know whether this is coming at but here is my point.

i say the best stimulus for the market and the economy would be a short-term trade deal with china. by that i mean, they buy a lot of our stuff, we reduce tariffs or cut tariffs out completely. not saying we're going to get that i say that is the best stimulus. what say you? >> that would be wonderful. yesterday, china was signaling hey, let's come to the table, kind of get back to it. i think unfortunately we have two things going on. as i see it, presidential election and then the, the anniversary of peoples republic. both of those require our president and president xi to look strong. so, you know -- stuart: october the 1st is the anniversary, 1949 takeover by the communists in china. >> yes. stuart: that is an important anniversary. >> absolutely is. stuart: you're saying that xi xinping has to look strong? >> that's right. comes down to looking strong, be strong. we could see an interim deal. it really comes down how it will appear to each party.

stuart: my premise was, not that we're going to get that kind of deal, my question is the stimulus. >> that's right. stuart: other side of the coin 24 hours from now, jay powell fed chair will speak in wyoming. he will lay the law down we think on future rate cuts. >> yeah. stuart: is that what you guys in the market? you're all over this one, aren't you? >> we're all over it. the symposium at jackson hole, we have to remind ourselves is a working meeting. mostly a closed working meeting. it is around the challenges of monetary policy, really around the world. what tools do people have, what tools do people not have? with powell's speech, it will be a introductory speech, here is what we do at our symposium. what we hope for, some kind of a tightening up of their message relative to his job at the press conference after the last meeting, right? stuart: we'll see if he bows to the pressure from the president.

>> that's right. stuart: yeah. the president is really laying it on thick. >> that's right. one of the things i draw out from the minutes of the last meeting was, discussion at that meeting about generally together, favoring an approach that doesn't provide any appearance of a following a preset course. so they are very intentional not wanting to signal, hey, we're starting a series of rate cuts, we're one and done. as we discussed before. because they want that flexibility. they want to watch the data, make judgments about the future. then ability accordingly then. stuart: i'm not sure how the market responds to that. >> that's right. stuart: only time will tell. >> that's right. stuart: michael, thanks for joining us. appreciate it. >> okay. stuart: a retired, the retired four-star general jack keane says we can make a deal with the taliban as soon as next week that would end america's longest war. the one in afghanistan? he is on the show in a moment. ilhan omar, republican challenger, she has one, the

congresswoman made herself israel's enemy by backing boycotts. he is on the show later this hour. we'll ask him how he plans to unseat omar in minnesota. mayor of san jose, california, wants to require gun owners to buy liability insurance. how does he plan to identify everybody with a gun to begin with? that is an important question. we'll ask him. we'll be back. ♪ hmm. exactly. liberty mutual customizes your car insurance, so you only pay for what you need. nice. but, uh... what's up with your... partner? not again. limu that's your reflection. only pay for what you need. ♪ liberty, liberty, liberty, liberty ♪ experience the luxury desire of a full line utility vehicles. at the lexus golden opportunity sales event. lease the 2019 rx 350 for $389 a month for 36 months and we'll make your first month payment. experience amazing.

stuart: 100 point gain for the dow. we will take it. now this. senator lindsey graham has just said that he will introduce legislation to create a backstop measure in afghanistan which would certify that lowering our troop strength below 8600 soldiers, would not endanger national security. so he has put a check and a

balance in there. general jack keane is with us, fox news strategic, senior strategic analyst. now we're going to have maybe a deal with the taliban next week. does senator graham's statement complicate that? >> no, not at all. here is what we think the deal is going to say. the centerpiece of the deal is, is that the united states has agreed with the taliban, to get out of afghanistan by the end of 20 to, which is 14, 15 months from now. and in return for that, we get a couple of conditions. one, the taliban and afghan government will talk. that is a good thing. two, we'll immediately reduce our forces about 140 days to 8600 and hold there, to see if there is an agreement between taliban and afghan government before we go any further. the third thing is, the one we have the problem with, and that is, that the taliban guarantees to the united states, that the al qaeda will not establish a safe haven in afghanistan, and

number two, that they will help defeat isis. we don't believe the taliban can be trusted. there is plenty of evidence to that effect. so senator graham, what he is proposing is legislation and, senator mcconnell has agreed to put this legislation forward, that would require the secretaries of defense and state, to come before the congress, and to certify that there is no threat from afghanistan to the homeland of the united states any longer. before, we reduce those forces. that is what this is about. stuart: that is the final point in the deal that you were talking about. we leave it to the taliban to get rid of isis and get rid of al qaeda. >> yes. stuart: you don't trust them to do that? >> no. we're making assurance this is will work. here is what is likely happening right now. the taliban, al qaeda are brothers. the taliban invited al qaeda into a afghanistan in the mid 90s, ubl, gave them a base to set up operations.

when the attack came on 9/11, followed after two embassy attacks in africa, and uss cole, president bush said to the taliban, give up al qaeda and we'll not deal with you. they refused. putting their regime at risk, and their lives at risk which they lost by the thousands. now after the taliban was willing to protect the al qaeda, to the expense of their lives and their regime we'll trust them now to give them up? i don't think so. stuart: okay. >> that is the issue. i believe right now, the taliban is telling the al qaeda, lay low, don't increase your activity, don't increase your numbers. wait until the americans leave. you well have your base back generics they're playing game. stuart: >> absolutely. stuart: you doesn't believe we should leave under those conditions? >> we should hold 8600 until such time the united states is comfortable there is no threat to the homeland from afghanistan. stuart: those 8600 troops are potent, presumably? they have -- >> some of them are advisors.

there is counterterrorism force there that pulls triggers against these guys. that is very important. they also have intelligence capability. remember from afghanistan, we have covert operation bases we conduct operations against al qaeda in pakistan. from one of those bases we killed osama bin laden. we killed most of their lieutenants. right now we have our foot on their throat. they are in hiding. if we leave afghanistan, they come out of hiding, re-establish a base. they have never given up the aspiration and strategic objective to kill americans. stuart: what you're talking about though, what you're talking about about is staying there for a very long time. >> i'm talking about staying there until those conditions change. listen, we're going after the al qaeda in yemen for years. in libya, off the coast of africa, in somalia, because all these of those organizations threaten the united states. we've been at it for years. we'll continue to be at it for years. we should be at it in

afghanistan. we're not dealing with a war that has a beginning and a start. we're beginning with an ideology that is generational. we've got to our head around that. stuart: political will to stay there for a long time? >> that is, you put your finger on what the issue really is. stuart: that is what it is all about, isn't it. as we head up to the 2020 election. general keane, thank for talking with us. total change of subject. san francisco no longer using words like offender, addict or convicted felon describing people who commit crimes. we'll tell you what is behind the push to sanitize the language. we have a story for you. a recent "qunnipiac poll" shows only 34% of women approve job president trump is doing. big problem for his re-election, right? what will he do about it? we'll ask that question to someone who knows the answer. ♪ (woman) somebody would ask her something and she would just walk right

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not promise... prove. and now, all beds are on sale! save 50% on the sleep number 360 limited edition smart bed. plus 0% interest for 24 months and free home delivery. ends saturday stuart: we lost about 100 points on this rally at this point, but we're still up 65 points, i guess we'll take it. now some of the retailers, you have got to look at this, not only all over the place, most are going straight up. target, huge gain yesterday, another nice move up today. $104 a share on target. very different story at l brands, which as you may know, the parent company of victoria secret. that stock is all the way down to $18 a share. that is a 9% loss. for some reason, wells fargo cut its price target from 35 to 32! i don't get it. does that mean that they expected to go up from 18 to 32

now, instead of 18 to 35? i don't get that one at all. the stock is down 9%. nordstrom, strong report this morning, very strong result. it's a department store, for he have heaven's sake. it is up 13%. president trump just tweeting on the economy, here it is. the economy is doing really well. the federal reserve can easily make it record-setting. the question is being asked, why are we paying much more in interest than germany and certain other countries. be early for a change, not late. let america win big, rather than just win. this is more part of the president's pressure on the treasury. i'm sorry, on the federal reserve. now i have got to bring this to your attention. this is why the market has come back a bit. the two year, and the 10-year, are now inverted again. that means, that the two year yield is above the 10-year yield

ashley: yeah. stuart: that is the inversion. some people say down the road that means we get a recession. that hits the stock market when you get the yield inversion. it does hit the market. we're down 20 points now for the nasdaq. down a fraction on the s&p. dow industrials have come all the way back from a gain of 150 to a gain of 65. ashley: how quickly that changed. stuart: this is about the yield curve. ashley: yes it. stuart: i will repeat it because it has been all over the place. earlier today there was no inversion. the 10-year was above the two year. that's changed. the two year is now above the 10-year. that is an inversion. you got this? that is inversion. that is bad are to the market as you can see. do you have anything to add to this? ashley: i couldn't have done any better, did you. you got it right on the money. it dips into the inversion, dips out again. then we'll stay away for it from a while and then come back in. is this really recession sign or

just an unprecedented low interest rate situation around the world? stuart: here is one thing i will absolutely guarranty, competing networks, specifically, msnbc and cnn say it's a recession. here is comes. i told you so. trump's in trouble. president trump says he is the chosen won to win a trade war with china. we're still far from making any kind of deal. is the president willing to put his re-election on the line over this? we'll ask that, ask the question. in the 11:00 hour we have a billionaire businessman. he went undercover with nothing but 100 bucks in his wallet, 90 days to start a million dollar company. he is on the show. we will be back. ♪ this is the couple who wanted to get away

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♪ ashley: yes. stuart: you really know the microphone is open? ashley: it is beatles. you just can't help it. stuart: not my birthday. you know it is your birthday, that is the title of the song. all right, move on. dow industrials are up 43 points. the yield curve sin verted. keeps backing in and out of inversion. 1.598 the two year, 1.593 the 10-year. therefore it is slightly invert that is what is hurting the market. next case, poll from quinnipiac, president trump's approval rating among women, 34%. disapprove, a whopping 61%. president trump's re-election campaign will dispatch a team of

women to help more women to think favorably about the president in the 2020 election. tim murtagh, trump 2020 director of communications is with us right now. tim, what is the team of women, what's their approach, what are they going to say? >> these are strong women, strong leaders in the trump campaign and, tonight, they will be at 14 different events in 13 states. they will be talking to volunteers, people who are going to be on the ground, other women on the ground helping the trump campaign and the president's re-election, training them how to be volunteers. how to engage their friends and neighbors, how to be leaders in their community and the campaign will deploy them. we're talking about several thousand women we expect to be at these meetings across the country talking about how great the trump economy is for women. how the president is the first president in the history of this country to put paid family leave in his budget. that is something very important to a lot of women. how 600,000 women have been lifted out of poverty since the

president took office. so this will be an army of women volunteers being trained. this is not the last time that we'll be doing this. they will be going around the country spreading a good message what president trump has done for women in this country. stuart: i don't think women's objection, i don't want to speak for women, i don't think their objections with the president has anything to do with jobs, wages, state of the economy. i think it is the president's history with women, and the use of language by the women, by the president. you know, it takes a lot of getting used to the way he comes across. that's your problem, isn't it? >> well, there is going to be a clear choice next november. it doesn't matter to us who the democrat is that they put up. women, any other voter will have a choice between the positive policies of president trump, the policies that are fueling this growing economy, versus a democrat who would reverse all those things, have a government takeover of health care, women have private health care plans.

they have blue cross, blue shield plans just like everybody else. if a democrat gets elected, their health care plan would take those private health insurance plans away. those are very important messages. there will be an absolute clear choice. you will have policies of president trump which have created this strong economy versus the democrats who would absolutely crush it. stuart: let me move on to china trade. the overwhelming question for the election 2020 is this one. is president trump willing to put his re-election on the line to get a deal with china? what do you say? >> the president's policies on china are clearly working. china came to the negotiating table, no one ever thought that would happen. every candidate who runs for president in history has always promised to get tough on china, no one ever did. until president trump came along. he said he would do it, he did it. china came to the negotiating table. people said it wouldn't happen. look what happened. the chinese economy is failing. it is auto industry is in trouble. banks are failing. they admitted they're up against

the wall by very obvious currency manipulation they engaged with a couple weeks ago. it is working. meantime the trump economy here in the united states is still growing, consumer confidence is high. the small, small businesses are showing great confidence about 70% of small businesses like the direction that the economy is headed. the american economy is strong. more than 6 million jobs created under this president, half a million in the manufacturing sector, the energy sector still growing, also the construction sector. so the american economy is strong, continues to grow. confidence is high for the future. meanwhile china is in trouble. we have seen that the president's policies are working and they will continue to work. it was the right thing to do. no one disagrees with that. stuart: that is true. tim, thank you for joining us, sir. we appreciate it. >> thank you, sir. stuart: let me go quickly to the market. we turned south for the dow industrials. we're off 18 points. the s&p is down. the nasdaq is down. all of this happening because

we're back to the inverted yield curve. ashley: it is still inverted. stuart: the market pays very close attention to it but i can't help but think though if short-term rates are above long-term rates, not the way it ought to be, does it put pressure on federal reserve to do something fast, stop the inversion. the market doesn't like it. we're down 17. apple, let's go back to that. apple is set to revamp some of the products. i'm told it is very important. ashley: upgrades to ipads. rumors of the biggest first change to the macbook pro in three years. the biggest change, lawn of three new iphones. a iphone pro model is getting a the love talk. apparently the big feature will be a camera system on the back a third sensor for capturing ultrawide angles, both for photos and videos t will also allow the camera to let users

zoom out to capture a larger field of view. these apparently will be on sale starting next month. so is it enough to get people to ditch the phones they have now? we had a guest on earlier, joel, gentleman, said maybe people will wait until 5g is roundly used to upgrade to a new phone. but interesting stuff. stuart: i use this thing as a camera, just as much as i use it for -- ashley: as do most people, i think so. ashley: yes. stuart: that's what it is for, partly. have you ever heard of the julie company alex and ani? i did not. did you know they were suing bank of america for a billion dollars? no, i didn't know. we have some movement on this lawsuit and the reason for it in the first place. ashley: alex and ani, a rhode island-based jewelry-maker. they filed a $1.2 billion lawsuit of bank of america, that they were wrongly put into default and led the bank freezing a 50 million-dollar credit line.

all this has been resolved. the lawsuit was withdrawn. we have a statement from bank of america saying we are pleased that alex and ani voluntarily withdrawn the lawsuit. bank of america strongly disagrees the allegations made in the lawsuit. we look forward to continue to work with alex, and ani, six other banks involved in the lending group. b-of-a, there was no payment made in conjunction with the withdrawal of that lawsuit. stuart: that is interesting development. lawsuit off, done, say good-bye. ashley: yeah. stuart: doesn't happen very often. ashley: no. stuart: coming up shortly on this program, a couple minutes time, the republican who is challenging congresswoman ilhan omar. how does he plan to win in her district which is very sympathetic to her? we'll ask. we'll tell you the new terms that san francisco, the new language they will use to describe convicted criminals. the city will no longer use words like offender and addict, convicted felon. what will they replace it with? we'll tell you after this.

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stuart: okay, we've lost all of the gains that we had in the opening hour of the markets. we're down 36 points. here is why. we've gone inverted again. look at it on your screens. we now have the two year yielding just a fraction more than the 10-year. that is an inversion. the market doesn't like that. so down goes the stock market. okay? it's a tiny inversion. there you have it on your screen. our next guest is a republican. he is challenging minnesota congresswoman democrat ilhan omar. lacy johnson is the congressional candidate. he is a republican.

he joins us now on the show. >> thank you, sir. stuart: we're looking 2017 numbers, report from the census department, in that district, the district that you're going to contest, omar's district, there are 58,000 people voters, who come from sub-saharan africa, mostly from somalia. >> yes, sir. stuart: they will vote for ilhan omar. how do you overcome that? >> well a couple things. i don't concede them to ilhan omar. i ran for state office last year, and i had quite a few somalians support. in fact, somalians was people who took my voters to the polls on election day. stuart: okay. >> it will still be hard to overcome. the second thing is, they are not a big percentage of the voters. i think there are 500,000. they are 58,000, 10%. i have african-american voters, jewish voters, 30% republicans in there. if you start doing the math,

even though i have not done all the data analysis. i think we have a good chance. miss omar has a record of being anti-israel, being anti-jewish, she has a record being a socialist. she has record of supporting nonprofit government solutions in our district that hasn't worked for decades. she keep pushing them. if you really pay attention to those solutions, really what it is saying we don't think you can do what we did. we don't have any confidence in the people that is in your district that they can educate themselves, go to college, do what i did, so we're going to feed you. we'll give you fish, instead of teaching you how to fish. stuart: are you a trump guy? >> yes. stuart: strongly so? >> yes. i support his policy. everything he has done at the economically, as far as foreign policy, things like that. and i'm a results oriented person. my background is engineering. i look at data. i don't look at personalities. i don't look at emotions. i don't look at opinion, overall. i am taking into consideration

whenever you're in politics, what i'm trying to decide how well someone's performance, start with data. when i start looking at data as far as unemployment, data for the stock market, status of the what is happening as a result of him renegotiating some of the trade agreements what he is doing with china, those type of things. the data says the guy has done a great job. he has been good for our community. stuart: omar is particularly critical of the america's relationship with israel. you think ira firm supporter what president trump is doing for israel. >> yes. couple of things, jared kushner, working to get a peace treaty done. i expect to see something done in that area. he stood up what every president promised to do, did not do it, moved the capital. he is against bds. if you think about bds, that is declaring economic warfare on israel. what company, what country is going to accept that? and i look at it like this. if she can call for the boycott

of race ail, why can't israel call for boycott of her? so those are the type of things that i look at. that makes me support what they're doing. stuart: are you anointed republican challenger to ilhan omar? >> you know -- stuart: are you home free yet or not? >> here is the thing. i hate to go with the anointed part. i'm a southern baptist. that word is reserved for certain people we don't want to deal with. stuart: you object to president saying i'm the chosen one? >> no, because i think he has a sense of humor. sometimes he says stuff to get on people's nerves. so people will at cnn will go crazy. stuart: i got to end it. lacy lee johnson, don't be a stranger. >> i won't. stuart: thank you, sir. let me deal with this, san francisco. ashley: oh, boy, kanging words it uses to describe criminals. tell me more. ashley: the language no longer will be used. we have a graphic for that the felon, offender, convict,

addict, juvenile delinquent. can't use them anymore. stuart: can't use them. ashley: what is the new version of these particular words? formerly incarcerated. person justice involved person. returning resident. person unsupervision. and jewel fly delinquent is no -- juvenile dell linkent, person with just sis involvement or person under supervision. stuart: returning resident. put it up on the screen. >> if your car was broken into, the police could file this report, coming in with justice system, currently under history of substance abuse. stuart: okay. oh, man. ashley: the reason they do it, they don't want people, they don't want people forever labeled. stuart: lacy lee johnson is still on the set. you can't believe it either. [laughter].

ashley: that is san francisco. stuart: next one. thank you. mayor of san jose, california, calling for mandatory liability insurance for gun owners. okay. here's the question, how do you identify all the gun owners to begin with? that ain't easy. ashley: good question. stuart: check out the big board. we are moving a little bit further south. we're down 63 points now because we're back to the inverted yield curve. we will explain all of that this. ♪ there's a company that's talked to even more real people

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stuart: all right. we're still on the downside. 47 points lower for the dow industrials. that is complete reverse al what we saw at opening bell when the dow went up over 100 points. we have roughly 200 point reversal. here is why. that inversion again, the yield curve inversion. it is still inverted. the yield on the two-year treasury is higher than the yield on the 10-year treasury. that is inversion. supposedly a sign of a recession. 18 months, two years, down the road. market doesn't like it. market has sold off a bit. stuart: san jose, california, considering a proposal that

would require gun owners to carry liability insurance. the man spearheading that proposal joins us now. sam locato, mayor of san jose, california. your honor, welcome to the program. good to see you. >> good to be with you, stuart. stuart: my first question is this, if you're going to require liability insurance on the part of all gun owners, you have got to identify all of the gun owners in your area, and you can't. i don't think you know, do you? >> no. we don't seek to identify all the gun owners. we would enforce this requirement in the same way that every state enforces auto insurance requirements. if someone is pulled over, the first question the officer asks, do you have insurance, you have to provide proof of that insurance. so similarly if there is a valid fourth amendment compliant search consent search, a search pursuant to a search warrant, plain view, of a gun by an officer, then the officer has the ability to ask the

individual do you have insurance for that gun. stuart: this is a proposal at the moment. have you any idea what liability insurance would cost for a gun owner? >> we know many homeowners policies include insurance against accidental firing of guns within the home. many of, many include that as part of their standard insurance. renters policies often require riders for a few dollars more. this is already being offered out there in the market for simple accidental use. more controversial question would be whether or not the city would require insurance for the intentional use by their parties, for example, if firearms are stolen? we know that between two and 300,000 guns are tollen every year. they usually land in hands of people using them for crimes. that is more controversial question. right now there is not clear a market for that, whether or not a regulation might force the

industry or encourage the industry to better word to get into that market. stuart: is your objective to lower the number of guns in san jose and to try to do something about mass shootings? is that the intent here? >> my purpose, my intent is really twofold. first harm reduction. we see in the context, for example, with auto insurance how insurance can provide a motivator for safe conduct. we get good driver discounts on your premiums. we get discounts on premium, for example, for have being airbags. on other hand we know as every parent knows, that if you get a 19-year-old on your policy your premium goes up. that is the way in which insurance through the market moderates risk. so similarly we could do the same with gun ownership. how you might reduce your premium, for example, by taking a gun safety course. or by having a gun safe, or by

insuring you only have guns with have save locks. we know that through the market. there are means which we can encourage safer behavior. there is another purpose here. that is to address the subsidy right now that the tax paying public pays for gun violence. and, in california, that is a subsidy to the tune of $1.4 billion. a public cost for everything from emergency response to emergency room treatment. all of the costs that result from the human harm of gun violence. it seems to me that those costs should be properly distributed and allocated. insurance is one way of doing that. stuart: can i just ask, it's a proposal at the moment. i take it that there will be a vote on it. when is the vote? >> well, we just had yesterday council committee agree to move forward with the study that would be required. it is called nexus study because we know there needs to be a fee

if someone cannot get insurance, they need to be able to have some other means of satisfying the requirement or else you have a second amendment problem. so we're doing what we call a nexus study to establish that fee. that will take several months. it will come back to council. i would expect this is a few months off. the good news we had a unanimous vote yesterday. stuart: thank you. the mayor of san jose, california, we appreciate it. >> it was a pleasure. thanks, stuart. stuart: yes, sir. the economy, our economy, it is slowing just a little. the world economy is slowing a lot. in my opinion, which i'm about to offer up, the best stimulus for us is a short-term trade deal with china. my take on that, top of the hour coming up. the ceo of allstate says we need to save capitalism by paying people more. i going to see what a billionaire businessman makes of that. bernie sanders, tweaking his "medicare for all" proposal to please the unions. any money an employer saves

through his health plan will go straight to the unions. vote for me. more "varney" after this. ♪ fees for brokerage accounts. at fidelity those zeros really add up. ♪ maybe i'll win ♪ saved by zero

stuart: our economy is slowing a little. the world economy is slowing a lot. so what's the best way to get things moving again? answer, my opinion, a deal with china that increases trade. let's be clear. we're not likely to get an agreement that deals with china's theft of intellectual property, or the forced transfer of technology. that kind of comprehensive agreement looks to be far off in the future. a more immediate possibility if both sides would bend just a little is the removal or reduction of tariffs and china's purchase of a large amount of american stuff. that i would call a deal. president trump is negotiator in chief and i have no idea if this kind of small-scale deal is in his playbook.

china's leader xi jinping seems preoccupied with events in hong kong and i have no idea if he would be prepared to bend at all. but if you ask what is the best way to stimulate any kind of agreement with china, it's a clear-cut winner. it would end at least some of the uncertainty which is definitely held back business spending. it would help consumers. they wouldn't face price hikes on chinese products. and it would pump a lot of money into our economy if the chinese bought a couple hundred billion dollars worth of american products. and for china, don't tell me they wouldn't benefit enormously if their trading relationship with america was restored to something near normal and the rest of the world, don't tell me they wouldn't benefit from a u.s./china get-together. more trade is good for everyone. china trade is the only option. it's the main reason why things slowed in the first place, and like it or not, likely or not, a modest deal on tariffs is the best answer on the slowdown.

that's my opinion. the third hour of "varney & company" is about to begin. stuart: this is what's affecting your money primarily at this moment. the so-called yield curve. the difference in yield between the two-year and the ten-year. at the moment there's no difference. neither inversion nor the other way around. they are dead even. that's not a great sign. it's not an inversion quite, but you're close. the market does not like it. look at this. we are down 70 points now because formerly, a few minutes ago, we were inverted. now we are down 60 odd points for the dow. we are down 74, nearly 1% on the nasdaq, and the s&p is down a half percentage point. the selloff because of the yield curve inversion. jeffrey cleveland is with us now. jeffrey, you are an economist. what do you make of this?

it's barely inverted yet the market's selling off. what's going on? >> it could be the computer, the algorithms running amok here. i don't think for real investors at home or the office that the two/ten yield curve tells them very much. it doesn't tell you when the economic cycle is about to end. the curve inverted in december '05. i'm sure you remember the recession did not begin until '07 so a full two years of time elapsed and equity markets did well. stuart: i wanted to mention to you the last -- when we first got this inversion ten days ago, the dow dropped 800 points in one day. now we have an inversion and are down about 70. can i conclude this inversion problem is not the big problem we thought it was? >> i think you can conclude that. it's not the big problem. it's not the single omen

everyone is looking for to guide their portfolio. the novelty of it first happening, i think that has an impact on markets in the short run but longer term, i think investors would do well to look at the curve but also look at other indicators. the u.s. economy in the first half of the year grew at an above-trend rate, 2.6% on average over the first half of the year. the data we have seen thus far in q3 tells us the economy is still growing at or above 2% which is a great rate of growth, and not a recession. i think that's the better message than just obsessing about the yield curve. stuart: it's killing my ratings, i'll tell you that. you start talking about the inverted yield curve, people turn off like you wouldn't believe. sometimes i have to do it. let's talk, i want to know, editorialized at the top of the hour, in my opinion, the best way to stimulate america's economy and the global economy is for a short-term modest trade deal with china. a stimulus package with china. what do you say?

>> well, i heard can i call it a rant? i heard the op-ed. i could not agree more. i say bravo, kudos to you. what is weighing on the global economy in 2019? it is trade, it is tariffs, it is the uncertainty, the fact they could change at a tweet's moment notice, if you will. so that is weighing on the economy. that has weighed down industrial activity in europe and in the united states. that in turn has held bond yields lower than they would otherwise be. that created this chaos with the yield curve. so end the uncertainty on the trade front. that's the most immediate stimulus you could do for the u.s. and global economy. i think you are spot-on. stuart: thank you for your support there. you are all right. you are a fine economist. that's obvious fact. i want to talk about the consumer. it seems to me this economy right now, the consumer is leading it. consumers are very, very strong. on your screen, nordstrom which

reported pretty strong results, the stock is up 15%. l brands is a separate story entirely. can i conclude realistically that the consumer is in great shape and is leading this economy? >> i would say the consumer is in great shape. when you look at the consumer now relative to say pre-2007, that downturn, we are in much better shape. we can look at debt to gdp, it's lower now. we can look at debt of households to disposable income, it's lower now. we can look at the fact that consumers have savings near 8%, much higher than they did before the onset of the last recession. they are in much better shape. then sprinkle in the fact the unemployment rate is at 3.7%, multi-decade low there. we see more employment as the year progresses and i think wages will creep up higher. so you have fully employed consumer, income coming in and you don't have the debt concerns, the debt instability

that you did last decade. to me, right there is a recipe for continued consumer resiliency and that will power the u.s. economy in the near term. stuart: you certainly have a lot of energy. for an economist that's pretty good. jeffrey cleveland, thank you very much, sir. always obliged to you. let's get to mortgage rates. the 30-year fixed rate loan, the yield -- not the yield, the rate on it, 30-year fixed, slipped a little this week. 3.55% is the rate as of now. it was 3.60% last week. i don't call that much of a -- ashley: no, we were expecting more. stuart: i was expecting a whole lot more. no effect on the home builders. it's a mixed bag there. mortgage rates i thought would come down more. if you are waiting to refi, wait a bit longer. a billionaire went undercover.

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stuart: did you see this? that is senator elizabeth warren with someone who could be her twin. she met the look-alike in minnesota. the look-alike's name is, what is it -- ashley: stephanie owen. stuart: deirdre, joining us now, you have not seen this? deirdre: i have seen the picture. i'm looking now -- stuart: who's the real one? deirdre: elizabeth warren is in the light blue. stuart: very good. but they could be twins. deirdre: i had to do a double-take for sure. stuart: the lady on the right is the real elizabeth warren. the lady on the left, the look-alike. deirdre: she has a good halloween costume, she wants to do it. stuart: have we got time for your story? ashley: she said i talk with my hands and shake my head, i look

even more like elizabeth warren. i kept saying i'm not her but i kept saying medicare for all. stuart: on that note, now this. yesterday, senator bernie sanders announced changes for his medicare for all plan. he's trying to appease the unions. any money an employer saves through their health care plan goes straight to the unions. congressman sean duffy, wisconsin republican, is with us. he's smiling already. what do you make of this medicare for all, bernie sanders goes to the unions? >> first of all, i think bernie sanders understands that people like the freedom to choose plans that work well for them and union members have gold-plated plans. so when bernie sanders comes out with medicare for all and says everyone in america who has a private plan including unions loses their plan, they don't like it. now trying to, you know, win favor with the unions, bernie sanders has walked that back and said no, no, we will let you keep some form of your private

plan. but what bernie sanders should recognize is all americans want their freedom to have their own plan, not be forced into a government-run single payer system which is his medicare for all plan. stuart: and changing like this to just grab union votes really looks -- it's so transparently obvious and weak. that's my opinion. okay. i don't put words in your mouth but that is weak to me. maybe i better move on. washington governor jay inslee is out of the presidential race. his big platform was climate change. here's another of my opinions. i don't think voters will buy the solutions to climate change that are being offered. what say you? >> breaking news, i didn't know inslee was in the race. low blow, but listen, americans and even liberals don't really care as a top priority about climate change. the first priority of democrats

is to beat donald trump. they care about the economy, they do care about health care, those are all top priority issues. climate change is further down the list and that's why inslee wasn't resonating with voters. even when you look at how democrats are going to do in the rust belt here and how they are trying to perform well with union voters, president trump, who has grown the manufacturing base by almost a million jobs in manufacturing, someone wraps the american flag around him, says i'm the american president, not a global president, and i have a little different opinion than you, i think his fight with china, who lie and cheat and steal, trying to make sure we have better deals for our companies and our workers, that kind of stuff resonates with those voters that bernie's trying to win because they are sick of deals that take advantage of them and their jobs and families and they finally have a president who is not just talking garbage to them like bernie sanders but actually delivering for them. on average, over president trump's tenure, wages are up for the bottom quadrant of american workers on the income scale by 10%. it's going great.

so i think the president is a far better position than some throw-off language by bernie sanders. by the way, socialism never grows jobs and never grows wages and that's what bernie is trying to feed unions and the american people. stuart: i know all about that. i'm a refugee from it. remember that, sean. look, back to this china trade deal, i editorialized earlier and said look, the best way to stimulate our economy and the world economy would be for a short-term small scale deal with china. they buy a lot of our stuff, we either drop or reduce tariffs. i'm not suggesting that that is likely. i'm not suggesting president trump go for it. i am suggesting that if you want to stimulate the economy, get some more growth here before the election, that's how you do it. you don't approve of that. >> no, i don't dispute that that would happen. i agree with you on your assessment. i think president trump, this is one of the problems in america, we look short term all the time. what can we do right now to make us feel good and goose our

economy. president trump is looking in the long run, how do i make sure america wins not just next quarter but next year and five years and 15 years from now in making sure we remedy the imbalance we now have with china is his focus, and yes, it's a little painful for the u.s. but we are crushing the chinese not only on tariffs but the supply chain is re-aligning. everyone who can get out of china is getting out. we don't see new capital flowing to china like we used to. so if the president keeps the pressure on, i think he's not going to get a reprieve, he's actually going to get a better deal. by the way, if we could get bernie sanders and the other democrat candidates to say i hate donald trump and he's an idiot and a pig, say what they want, but say he's right on china, if they did that with president trump, i think you would see a deal in the next week or month as opposed to china waiting to see if donald trump loses and they will have a softer negotiating partner with bernie or kamala or somebody else. stuart: sean duffy, congressman from wisconsin.

almost got it wrong. almost got it wrong. sorry about that, sean. republican, wisconsin. i will never forget. okay. thank you, sean. see you soon. quick check, where are we going? look at boeing. nice gain, 2.5%. moody's says their max jet will indeed be back in service by the fourth quarter of this calendar year, 2019. good news for boeing. it's at $348. now, check the markets overall. the dow, we are only down four points. remember, we lost 150 point gain because the yield curve became inverted. economist jeff cleveland moments ago said the market sold off because the algorithms kicked in. they saw an inverted yield curve, the computer said all right, sell, sell, sell, and they did. but the inverted yield curve is not the recession threat that we all thought it was. now we are only down 12 points. that's where we are. then we have forbes releasing the list of the highest paid actors of 2019.

that man is chris hemsworth. he played thor, remember that. he's number two on the best paid actors list. of course, we are going to tell you who is number one after the break. first, james bond fans, this is for you. the name of the latest movie has finally been released. you know how it goes. we will tell you the name of the new movie after this. why don't you take a guess? short commercial break to take a guess. that is denver. mile high city. ♪ patients that i see that complain about dry mouth, they feel like they have to drink a lot of water. medications seem to be the number one cause for dry mouth. dry mouth can cause increased cavities,

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stuart: the name is varney. stuart varney. i'm not going to joke here. when i first came to america and still to this day, americans would meet me and say say it, say it, say it. they want me to say my name is bond, james bond. it's lost its luster. we are trying to introduce the name of the new bond flick. deirdre knows the name. deirdre: i do. "no time to die." talk about a modern kind of interpretation. take a look.

take a look. here we go. ♪ deirdre: all right. daniel craig in there for apparently his last run. 25th installment. that's why people are -- listen, it's a classic series. people sit around, they talk about which bond they liked best, which movie they liked best, and i should say this trailer was released because they did have a little bit of bad news during the filming with daniel craig. he hurt his ankle, there was a controlled explosion, et cetera. stuart: but it's coming out in april? remember, we told you the name of the number two highest paid actor of 2019. ash will reveal number one. ashley: survey says, duane johnson, the rock.

$89.4 million followed by chris hemsworth, robert downey jr., and a bollywood star, jackie chan at number five and quickly, bradley cooper came in at number six with a mere $57 million but he's tied with someone i can't believe, adam sandler. $57 million. either way you look at it, they are making a ton of money. stuart: $89 million. change jobs. deirdre: everybody start memorizing lines. stuart: my name is bond. deirdre: there you go. stuart: interest rates, inverted yield curve hurt the market earlier but we have come almost all the way back. only a nine point, ten point loss for the dow industrials. our next guest says don't worry about this inverted yield curve. we are not headed to recession. that's what she says. she joins us shortly. we just received bernie sanders' new climate plan. we are going through it, looking for highlights and the cost, of course. we will bring you the highlights and the cost after this. ♪

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stuart: we do have the bernie

sanders climate plan. we have gone through it as far as we can. we've got some bullet points. first of all, how much does it cost? ashley: a mere $16.3 trillion blueprint to fight climate change, says mr. sanders. stuart: $16.3 trillion. what does the plan do with fossil fuels? ashley: well, it plans to eliminate fossil fuels by 2050. stuart: 2050. no more fossil fuels. okay. who's going to pay for it? ashley: in part, it's going to be paid for by taxes and new fees on that talked-about fossil fuel industry. in other words, they are taking real aim at the fossil fuel industry. deirdre: i can't hear the oil executives. stuart: your energy bill, whether it's gasoline, home heating oil or whatever, whatever it is, straight off. last one, do we pay poor nations? ashley: it does. this plan also commits $200

billion to help quote, poor nations cope with climate change. stuart: that's our money -- ashley: our money going to -- stuart: poorer nations. ashley: correct. stuart: wonder if china is included in poorer nations. ashley: one of the biggest polluters. stuart: india is second. so we are going to pay them under this plan. deirdre, this seems to be wildly expensive. deirdre: it's the most expensive, the most expensive proposed by any candidate in the equi democratic field and senator sanders talks about this as putting meat on the bones of the green new deal resolution which was just a blueprint and outline. this is actually official. it envisions building upon solar, wind, geothermal power sources, all of those companies could get a good boondoggle although i'm sure some of them are working hard. stuart: i'm sorry. i have to make the conclusion this is economic fantasyland. ashley: yes. stuart: you do that to our economy, you kill it. flat out, you kill it. we are going to give $200 billion, we are saving the

planet. shall i move on before i explode? ashley: please. stuart: we have a small loss for the dow industrials, 18, 20 points down as we speak. the majority of the dow 30 are in the red. it's flat to lower so far. now, here's the big impact. this is the big factor on the market today. that yield curve has been resurrected. it's no longer inverted. the two-year yields 1.58%. the ten-year, 1.59%. again, that is the way it should be. when it was the other way round earlier this morning, that's what sent the market down. heather zumarraga is with us, market watcher supremo. welcome back to the program. it seems to me that this inversion story no longer has the big negative effect that it did, what, ten days ago. >> no, it sure doesn't. i mean, the president is critiquing the fed and even commenting on this crazy inverted yield curve almost every day now. when you think about it, yes,

historically when you have short-term rates higher than long-term rates and that so-called yield curve inverts, that is a bad signal the economy could go into recession but that is not the case this time. it might actually be different. that is because we have never had a situation where so many countries around the world have negative interest rates at the same time as our yields have so-called inverted. that's why this time is different. stuart: i would have thought that the federal reserve would act quickly. if the yield on the two-year is above the yield on the ten-year, the inversion, wouldn't the fed move quickly to counteract that and get the yield on the two-year down? where am i going wrong with this? >> well, you're not. look, they cut rates a quarter basis point last month. we just got the results of the fed minutes saying that, that was a midcycle adjustment and that may be one and done. that is because the economy is so strong.

again, regarding the inverted yield curve, the banks are the main problem. it's that banks stopped lending. we aren't seeing any sign of that right now according to the fdic. bank profits are near record highs. they are making a lot of money and they are lending. so if you start seeing the banks roll over, then we have a problem. but with the economy so strong, look at retail sales. nordstrom, target, lowe's are all doing extremely well. the economy hinges on the labor market and a strong consumer which we have right now. stuart: surely it's got to be all eyes on jerome powell, who speaks tomorrow, he's in wyoming, he speaks at 10:00 eastern time real sharp. it will be during our program so obviously, we are going to be dealing with that. but that's what the market's all concerned about, isn't it? will the fed lower rates dramatically and soon? what's your opinion? >> well, i think that historically, the jackson hole

symposium has federal reserve members or fed chair before have made statements about what they're going to do regarding rates. i mean, in 2007, ben bernanke signaled he was going to cut rates and he cut 50 basis points the following month. on your show tomorrow, 10:00 a.m., i'm sure retail investors and institutional investors, all eyes will be on jackson hole and the symposium for any statements coming out of the fed. i think they're just going to stay on hold, on pause, where they are right now, as evident by the minutes yesterday that this is a midcycle adjustment. stuart: let's see how the market reacts to that, if you are correct. because we will be watching. heather zumarraga, as always, thank you very much for being with us. by the way, where are you right now? i can see a gorgeous beach and ocean in the background. >> it's a great place to be, down in miami to escape the swamp every once in awhile. i would probably rather be in jackson hole but miami's not too bad in the summer either. 80 and sunny. stuart: you would rather be in

jackson hole, wyoming? please. heather, stay where you are. see you again soon. heather zumarraga, everyone. by the beach. thank you. president trump saying that he has a good relationship with apple's chief tim cook. okay. you think maybe google's chief should take a leaf out of that book? ashley: it's interesting. this is what the president said. he had dinner with tim cook the other day and said quote, others go out and hire very expensive consultants. tim cook calls donald trump directly. the president has said he's heard the concerns from tim cook about the tariffs and how it's very hard for apple to compete against samsung when apple is paying tariffs and samsung isn't. so the president went on to say look, he's explained the problem to me, it's a great american company, samsung is in south korea, he noted. he said i've got to help them out short-term with that problem. what he does, whether they take action, we don't know. but i think tim cook's being smart. stuart: i think so. ashley: that's the way to do it. go straight to the oval office.

go straight to the man with power. stuart: a little more on apple, because their new credit card is available to everyone in america who has an iphone. wait a second. what's this about a wallet warning? deirdre: so it can actually stain your clothes. apple actually warns against storing it against leather and denim lest they cause discoloration that will not wash off. it has a high metal content. if you drop it on the counter you get a nice ping but the truth is really, apple wants you to use apple pay. they are just trying to get a little more into payment and are hoping this card which they partner with goldman sachs with will get used to giving you the idea that okay, they have cards, they have payment processing. stuart: the dow just turned positive. maybe they were listening to heather zumarraga. ashley: the yield isn't inverted anymore. stuart: we'll take it. a bit more on apple. they are gearing up with a new line of products.

pick out the highlights. ashley: revamp of the ipad, first time they have done a refresh of the mac book laptop in three years. it's the launch of three new iphones being reported. the main feature, the so-called pro iphone, this is interesting, a new camera system on the back with a third sensor so in other words, you can get ultra-wide angle photos which is kind of cool, and basically allows users to zoom out and capture that larger field of view. you know, as you pointed out earlier, we all use these cameras, you know, these phones as cameras and use them almost daily. i'm amazed at the quality already but apparently this is going to be better. stuart: terrific pictures. ashley: incredible. stuart: maybe you should check, double-check your cable bill, if you haven't gotten -- if you have received a free upgrade. what's the problem? deirdre: yeah. there's a lot of problems here. comcast, charter, at & t, they

are leaning very heavily on broadband. they will give you better service, say it's part of a promotion and 10 to 12 months later, you get a higher bill. you didn't ask for the upgrade, they gave it to you for free, but then you will later be billed for it. a lot of times the speed you are getting for free is not even a speed that may work, for example, with your router at home. so listen, more and more people are cutting the cord. these companies are getting a little more creative as to how to keep people under their roof. stuart: okay. deirdre: check your bill. ashley: read the fine print, as they say. deirdre: very much so. a lot of times they are promotional, even if you figure it out and call they say it's a promotion, you are a good customer, we wanted to make you happy. 12 months later you still have to pay. stuart: move on. allstate's insurance, their chief tom wilson says you can save capitalism by paying people more. what would a successful billionaire think about that?

we are going to ask one in a moment. his name is glenn stern. he's going undercover to see if he can build a million dollar company in 90 days with only a hundred bucks in his pocket to start with. we'll be right back. ♪

♪ stuart: that's eminem's classic "lose yourself." we have word that spotify might lose themselves in a lawsuit from eminem's people. deirdre: eminem's publisher is suing spotify saying that spotify knowingly streamed these tracks without proper licenses, which flies in the face of the music modernization act passed in october which allows artists

to get paid in these online streaming businesses. it's a whole new thing for musicians, a whole new landscape to navigate. spotify will have to lawyer up. stuart: that's a big deal, actually. on a similar related note, taylor swift, did you know she no longer owns her mega-hits? she has come up with a solution. ashley: she has. she's going to re-record all her albums to get back ownership. she lost the first six albums because the music label she was with in nashville sold out to another group and she lost all of her life's work on that. she no longer has any rights to those. she does not own them. this is not the first time an artist has done this. she says absolutely i will re-record all of that and get ownership back. stuart: why not? that's the way to go. deirdre: control. ashley: control. stuart: have control of it. good stuff. at last, we do have the undercover billionaire on the program. he's with us. he is, i should tell you, a real billionaire who dropped into erie, pennsylvania, hundred bucks in his pocket, and his

challenge is he's got to start a million dollar company and conclude it in 90 days. i've got a clip for you. roll it. >> how do you feel about us selling your beer in our restaurant? >> i would love to. >> we love great partners. we appreciate that. >> i want to go out and support the guys that are supporting us. >> that's the idea. stuart: kind of looked like pulling teeth for a moment. there he is. that man is glenn sterns, the undercover billionaire. glenn, welcome to the show. great to have you on. i know you cannot tell us whether your challenge, hundred bucks in your pocket, 90 days to start a million dollar business, you cannot tell us whether you are successful or not. i understand that. because the show is in progress. but why you doing it in the first place? >> well, my wife said it's basically a midlife crisis.

you know, really, i grew up hard. i failed fourth grade, i was dyslexic, i had a child when i was 14 years old, eighth grade, so a lot of my friends, people said glenn, this couldn't be done again. you were very lucky. i think in this country, where we live, there's so much opportunity so i said you know, i bet i could do it again. start from nothing. stuart: it's a huge challenge. you start with a hundred bucks in your pocket in a strange place, i don't think you are a native offer efe erie, pennsyl. 90 days to create a million dollar business. i know you can't tell us how it ends up but how are you doing so far? >> again, i went there without any expectations, not understanding what was going on but i knew some basic things from 30 years of building businesses. surround yourself with great people, find people that embrace your competition, go for a thing that -- don't be fear-based

motivation. just go out and try to surround yourself with these people that can help move you along. i just started down that path meeting good people and having this kind of objective out there and seeing if i could do it. stuart: you look like you're having a good time. you really do. you've got a big smile there. we kind of like that. billionaires are always having a good time, in my personal opinion. all right, glenn, i want your opinion on this one. the ceo of allstate, the insurance guys, wants to save capitalism. roll tape, please. >> that's what i'm arguing is we need to get boards and companies to stand up and say part of our job is to make money, got that, need to do that each and every year. second part of our job is to create jobs. and we need to hold ourselves accountable for creating high value jobs for america. stuart: okay. he goes on from there to say yeah, you've got to pay people a lot more money. what's your opinion of his saving capitalism solution? >> well, i see this from what we

did right now, what i basically did was similar. wealth is frowned upon nowadays, right, so i wanted to prove to people that you could start with absolutely nothing and build yourself up, and you don't need the contests, you don't need daddy warbucks behind you. capitalism, this country, that's what it's about, that's what we're founded on. i agree the people that can find a way to, you know, to grow their businesses are creating jobs. they're the ones that are out there helping the country grow. i was hoping this would be able to be something that i think people could look at and go okay, he's not just some rich guy, he's a guy that actually started with nothing and maybe i could do it, you know? stuart: i think that's laudable. i congratulate you on even trying to do this. i don't know how on earth you can possibly succeed but good luck, glenn. i will watch the show. how about that. seriously, thanks very much for being with us. we appreciate it. >> thank you.

stuart: sure thing. check this out. happening right -- no, this weekend, the new york air show. the navy's blue angels, the air force thunderbirds will be there and so, too, the royal air force's red arrows. that's the british air force, the royal air force, raf. they flew over the statue of liberty, trailing red, white and blue smoke. there's a quick glimpse of them. they did that this morning. check this out, too. ford's new electric mustang suv. i want to know why would anybody buy that. ♪ there's a company that's talked to even more real people

than me: jd power. 448,134 to be exact. they answered 410 questions in 8 categories about vehicle quality. and when they were done, chevy earned more j.d. power quality awards across cars, trucks and suvs than any other brand over the last four years. so on behalf of chevrolet, i want to say "thank you, real people." you're welcome. we're gonna need a bigger room.

stuart: on your screens, that's the ford new electric mustang suv. you can't see much of it, obviously. it's covered up for secrecy. gary gastelu has a few things on this upcoming car. what's the selling point of this electric mustang? >> sexy and fast. ford says it will go like hell, like they said their old sports cars used to. stuart: acceleration. >> exactly. very quick, with a range of over

300 miles per charge. it will look really good. it will be one of these four-door suv coupe styles but it is going to look something like the mustang, it's going to be inspired by it. that's what they're saying. ford has four different electric vehicle programs going on right now for the united states. this is the one that has the biggest potential to have a tesla moment for ford, where everybody freaks out and just has to own this thing. that's what they are hoping for. we will find out in november. they will probably reveal it then. stuart: let me go through it. acceleration rapid, 0 to 60 in about three seconds? >> probably in that range. stuart: that's fast. that's for sure. that's fast. the range again? >> 300 miles or more, competitive with the best ones on the road today. stuart: how about recharging the thing? how long to recharge and where? >> they haven't announced that yet but if they are not able to do the 80% in under an hour at the fast charging stations like all the other top electric cars are now, they won't be competitive. i'm sure they will be able to do that. figure overnight at home, if you get one of the fancy 240 volt chargers. stuart: if i do it at home, i've got to have, as you say, a fancy

240 volt charger. that i can plug into my own garage electric outlet. i've got to buy that. how much is that? >> you can get it for under $1,000 now. usually the brands will have their own one, they can cost a little more than that. it's really not bad. some states even give you incentives to have one installed right now. that's really the biggest advantage of electric cars, the idea that you can fill it up at home, you never have to go to a charging station or gas station, but look, we have seen where the electric car market is right now. tesla is the only one that can really sell them in volume. if this thing shows up and has that sort of mustang moment like when the mustang came out back in the 1960s, it could leapfrog everybody. ford is nowhere in electric cars right now. big in hybrids. they have not really done anything with electrics. this is what they are hoping will take them to the next level. stuart: it will be a mustang moment if the damn -- excuse my language, if it took off. excuse me. don't turn off your tv sets. gary, thank you very much indeed. appreciate it.

now this happened last night. in kazakhstan, the unpiloted russian-made soyuz spacecraft launched with just one humanoid robot on board. it's named fedor. not fredo. fedor. it's headed for the international space station. it's going to learn to handle tools like screwdrivers. fedor should arrive at the space station on saturday. ashley: long as he doesn't go rogue. stuart: rogue robot. carli lloyd, soccer star. watch this. okay, watch it. ashley: we're watching. stuart: you watching? ashley: i'm watching. here we go. stuart: kick it. whoa! that was at the philadelphia eagles practice, nfl, of course. that's a 55-yard field goal and

a hall of fame general manager says it's only a matter of time before a woman is playing in the nfl. now you know. more "varney" after this. ♪ this was me before liberty mutucustomized my car insurance, so i only pay for what i need. and this is me now! any physical changes to this man's appearance are purely coincidental. only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ now you can, with shipsticks.com! no more lugging your clubs through the airport or risk . . golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. shipsticks.com saves you time and money. make it simple. make it ship sticks.

stuart: just because i'm talking about inverted yield curve doesn't mean tough turn your set off. please don't do that in fact it is not inverted we can talk about it. yield on two year, 1.587. yield on 10-year, 1.598. there is no inversion. the dow we got an inversion earlier this morning the dow came back 100 point. we're down only three points. my point is this, surely if the yield on the two year is a above the 10-year, won't the federal

reserve move to lower rates on this two year so we know longer have an inversion? is that what they're going too do? suite see tomorrow. stuart: 10 tomorrow morning powell speaks. you will see what he says. some of it here. connell mcshane in for neil. connell: some of it, as much as we can stand. exactly. welcome everybody to "cavuto: coast to coast". i'm connell mcshane filling in once again for neil. we have warnings there is a slowdown coming. new weakness reported in the manufacturing sector. okay, to stuart's point we had a brief return of the dreaded inverted yield curve. we're told president trump weighing options how to counter any downturn that might be coming. there is talk of apple betting big on big spending talking about from all of you. could bigger a