todd cogle and, david glass and , now doug mcmillon. he is fabulous. people, always people.avid: when you look at a deal, how do you assess the character of leadership, a good one from a not so good one? ken: i met jeff bezos last year. i told him i would love to come out and spend time with him. he said he would like to meet frank, who ran home depot. he is retired. frank and i agreed to fly to seattle. we had lunch in his boathouse. let me tell you why this guy is a huge winner. two fabulous, incredible ingredients, smart and humble. now we went out to learn from him. when i left, i felt my brain had been sucked out of my head. there is a leader. it is no accident that amazon is the success that it is. the same with gates. the same with the guys at google. look at the size of these companies, trillion dollar companies today. look at the size of them. you say, what happened to general motors and ibm? they had so much of a headstart, it is unbelievable. so i can't emphasize enough it is the people. david: you talked about humble. you talked about smart. what about integrity?

david glass, and now more recently doug mcmillon. the guy who runs it. people.t is always the people. david: when you look at a deal, how do you assess the character of leadership. what defines a good one from a not so good one? ken: let me give you a specific example. i met jeff bezos last year. i told him i would love to come out and spend some time with him. he in turn said he would like to meet frank, who ran home depot. he is retired now. frank and i agreed to fly to seattle and have lunch with jeff. we had lunch in his boathouse. let me tell you why this guy is a huge winner. two fabulous, incredible ingredients like ham and cheese, smart and humble. now we went out to learn from him. when i left, i felt my brain had been sucked out of my head. there is a leader. it is no accident that amazon is the success that it is. the same with gates. the same with the guys at google. look at the size of these companies. they are trillion dollar companies today. look at the size of them. you say, what happened to general motors and what happened ibm? what happened? ho

david: in fairness, doug mcmillon is investing in the business. he is trying to upgrade and get that traffic and sales. alix: rachel, we will stop ignoring you. gina, i'm interested in the stock reaction. a huge job remarket, rolled over quickly. what does it take for beats? >> margins are a big sticking point in this earnings season. the stocks that have beaten on sales and earnings expectations, they have done well. if they guide lower, they have done poorly. it is about guidance. what is walmart saying about guidance? it sounded decent. what about the cost? this is characterizing the broad s&p 500, margins mean everything at this point in the cycle. we did see operating margin estimates peak and turned lower. that has the investment universe nervous about where margins are headed. we need to see margins expand to continue the cycle. it is at this point, short-term and long-term issue. doug mcmillon said we will invest for the longer term. he is trying to catch up or beat amazon. thinkinginvestors are about the longer term. if you look at what t

ceo doug mcmillon said they are aggressively pursuing that strategy. collect at walmart stores. amazon only recently announced they would be offering that service in some of their whole foods stores. selina: right, walmart has clearly been very aggressive. they have click and collect, they have curbside pickup. but how does this compare to amazon offerings? emma: we're still waiting to hear more about what amazon is going to be doing with whole foods. when amazon reported earnings earlier, whole foods was not really mentioned at all. when it comes to walmart and e-commerce, which is another area you can see a direct comparison between the two, you mentioned that they saw e-commerce growth of 40% last quarter. and that was compared to second quarter of last year, walmart saw e-commerce growth of more than 60%. but the fact they have returned to 40% on a bigger basis, suggests a more impressive result for walmart. one other winner here is the walton family. they are the biggest shareholders and walmart, the wealthiest family in america. and they just bec

what doug mcmillon did in transforming walmart is a terrific example of what companies need to be thinkingzon where you can return amazon merchandise to kohl's. steve: that is a great example of how you have to change. kohl's is a terrific retailer. they have partnered with amazon, you can buy the echo, return amazon products. they are only doing it in a few stores, 7% overall comp increases partnering with amazon. what could it be? every retailer has to look at what is right for them to innovate in the new environment. julie: i want to bring back lisa shalett. talk to us about the investing thesis on retail and consumer discretionary. maybe that is different from looking at the health of businesses overall? lisa: steve brought up a great point. where we are in morgan stanley, we have recently moved to underweight on consumer discretionary broadly as a sector. consumer discretionary, like technology, has been a sector leading for the cycle, for the past decade. we believe expectations and valuations is a sector, quite rich, and the time is for stock selection and active management. the poi

more recently, doug mcmillon. it is always the people. depot underat home bernie was thriving?n frank blake and it is roaring? what is it? it is back to the people. whenever i have made a mistake about people, i have paid dearly. , home that is ken langone depot cofounder. that is the premiere episode of big decisions, tonight at 90 5 p.m. eastern. i sat with him for a good half hour. alix: i love ken langone. he says what he thinks, let's it all out there -- puts it all out there. david: he swore less. alix: that would be weird. staying in retail, u.s. retail sales will be released in an hour. , -- still withes us is emily roland of john hancock investments and erik davidson of wells fargo. i have been talking about the fourth quarter gdp. the consumer represents two thirds of the economy in the u.s. and what is interesting to watch is this interplay between wage growth and inflation. at 2.7% lastame in month and that is a good thing in terms of the length of the cycle. it should stop the fed from moving too fast down the path of rate normalization. core cpi came in at 2.4% la

i got to hand it to doug mcmillon last month there's fremplnch's mustard for $1.49.hat's like a $4 product they always had these products that they sold for less than they paid for them they're underneath their own price and it puts you into the stores that's the walmart i love. they pay people warn elizabeth warren, segue. you don't have the same turnover you used to. it is remarkable when you speak to store managers, they understand exactly what is happening, whether louisiana, pennsylvania, new york, california this company is rejuvenated. congratulations to them. >>> "journal" today looks at manufacturing and retail growth this summer. this week home depot, macy's stock action notwithstanding walmart today. restaurant spending, at least as records go back. >> i want to emphasize again, people aren't spending on their homes. there's not a lot of turnover. cfo of home depot talked about homes aren't trading people are fixing up their house not just on groceries but on experience this walmart number solidifies everything that larry kudlow was talking about. the cons