and morningstar knows they rely heavily on it. in fact in our piece, an executive that focuses on behavioral finance at morningstar stated that they know that investors misuse it and even questioned whether they need to do something about that. >> it was really an amazing piece of work, sarah. whether you agree with it or not, it was hard, hard work. i recommend your article to everybody. >> thank you. >> thanks for being with us. instanci thanks for having me. >>> coming up, the first glimpse of what a towering border wall might look l >>> president trump's border wall may be taking another step forward. today was the deadline for six companies to finish building prototypes. aditi roy reports from the border in otay mesa, california. >> reporter: for the last 30 days, construction trucks have been humming. the cranes have soared. and workers have been buzzing around this otherwise desolate, dusty part of otay mesa, california. it's two miles from the border crossing with mexico. and the project they've been working on, building e

the morningstar star system, the fact that it is largely defunct is not new news. the sad thing that came out in the "wall street journal" front is that people had been relying on this, not only individual investors but financial advisers. the good news is morningstar itself can be used as an effective tool especially by individual investors. you just start by largely ignoring the star system. >> the stars, though, were a very convenient hook, not only for individual investors to look up and glom onto, but as you point out, for financial advisers to sell. here's a five-star fund, i wouldn't put you in a one-star fund. i know you well enough to know, tim, you lean toward index funds, and you believe they are an advantageous bet, not so much because of performance, but because of the connection between performance and low cost and low turnover. >> there's no question, tyler. inside o report by "the wall street journal," there was a subplot that may not have come through. it was really proving that indeed active investment managers really ultimately end up struggling

morningstar defending itself you will hear from their head of research about it. i'm brian sullivan power lunch begins now >> welcome to power lunch. i'm melissa lee. stocks are trying to hold on after yesterday's pull back. in the red here as we await earnings from technology earnings stories of the day here, nbc parent company comcast reporting an eps beat but missing on revenues. the stock down a percent at this hour southwest mising on revenues the stock was higher but went lower in the last few minutes. celgene down bigelowering the long-term targets for next year. the index is on pace for a seventh straight day of losses dunkin brands just shy of estimates but comp sales did rise anheiser-busch profits down 2% >> thank you very much, melissa. stocks holding onto gains in midday training. a host of large companies pulling away we begin with the opioid crisis. president trump will speak about the crisis in a few minutes from now. let's go to eamon at the white house. >> he'll speak in the next hour here at the white house on the opioid crisis. the president sa

working people in the in the military industrial complex let's go to the morningstar to a happier story everything's making you grumpy today this will make even more angry morningstar reports ministers accused of breaking promise to foreign fund fire safety now this goes to the granville tower story it's kind of interesting that not in the burning tower in the richest bar or one of the richest places a place of the norm is divisions some of those you love the women here and some of the poorest people in britain there as well now not in the city council's labor council that's a city in the midlands j.n.r. cart response for housing in the borough said the government blocked funds for works planned on high rises but they were considered additional rather than essential so in other words after all the talk about making these buildings safe the beginning to say well it's not absolutely essential being. nice to have and this is causing a bit when they're essential for the houses of parliament not essential viro sprinklers to be precise are being regarded as absolutely vital in the refurbishme

morningstar defending itself you will hear from their head of research about it. i'm brian sullivan power lunc

let's bring in barbara, she's analyst at morningstar good to have you here. >> hi, thanks for having me. >> i think a key question about the future of the stock and its price has to do with whether or not the dif devidend is going to hold do you see any way possible they keep the dividend in tact? >> after this surprisingly ugly quarter i think the risk of a dividend cut has increased you know, the reason for that is, you know, when you look at what management had laid out originally, we thought even if we came in at the low end of the previous expectations or missed it a little bit, they had options in place to sort of bridge that gap for the next couple years until underlying earnings improved but, i mean, it was a big miss this quarter you know, industrial free cash flow is going to be very weak this year. and not only that, but the ge capital dividends to the parent now seem to be off the table so if it that is, indeed, the case, you know, we think that ge would probably do itself a favor for reviewing that dividend policy and potentially making a dividend cut. >> run viewers thr

have a lot of women in top positions they are the funding you know their own fund level you know i morningstar research paper from last year notes that in the u.s. women only make up ten percent of fund managers. where make up thirty six percent of lawyers and thirty three percent of doctors so you're seeing this now it's gone creep in the wall street why is it a boys' club you're going to see those doors that glass ceiling whatever metaphor you want to use that school start getting torn down i think of ways that as a great. great way to put it and we. heard that from actresses tyra who worked in that same end as the boys i know exist in all day every industry politics that exists in wall street and that does have to stop it has to come out and the thing about that boy's club mentality is that what it really is is your straight caucasian rich well connected male what i want to ask you before we go out like a little bit at thirty seconds how do we stop this how do we truly stop this kind of harassment how do we bring this to. europe. honestly call the pigs out there go call them out there every

carol: you guys talked to other folks, and someone over at morningstar. what was his take on it?rst of all, think it is amazing. if you funding research, you have to be head of behavioral science. what i think a lot of people come to is not that you should be using this to diagnose the rest of the market, but you should be using it to look in the mirror. actually, the most powerful way to glean something useful from behavioral economics is to take it as a lesson to be humble about your own abilities. the first-person who should be diagnosed with irrationality is yourself. carol: staying focused on behavior, corporate behavior, is a story you will find on bloomberg.com and the mobile app. our economics reporter explains why demanding a axler's degree for a job may just be plain dumb. >> school is great. -- demanding a bachelors degree for some jobs is just plain dumb. >> full is great. he has been working on a new study called dismissed by degrees. he gets into a strange phenomenon which is that a lot of companies are insisting on a bachelors degree for positions that do not requi

joining us, senior analyst at morningstar. this would be an extraordinary deal, right? we're talking about a pharmacy company, pharmacy benefits manager going now into health insurance. that seems like a remake of this sector >> yeah, it is it basically what it is is a vertical integration in several key critical players in the whole system take a look at what united health has done, with its own operations, own strategy this falls pretty much in line of what they've done look at united health, has its own pbm, own insurance company what's going to be unique about this deal, though, you have a major pharmacy, cvs, integrating along every -- almost every single point of the health care space. health care insurance space. not only as the pbm but also as a manage the care firm >> i'm just looking here, aetna's market cap is hovering right around $60 billion what kind of a premium would you assign -- would you expect on this deal? i mean, this is going to be big here especially when you consider cvs' market cap is $76 billion. >> we should highlight, reporting, dow jones ha

the morningstar mirage, with a ba bombshell report, mutual funds by in large is not a good guide to futureresponded on cnbc yesterday. >> we're always looking at our ratings systems, one of the things you would notice is we made enhancements over time and furth furth furthermore introduced the analyst rating that can augment the star rating i should say when you take them together, they can be quite powerful in putting investors into funds that they're more likely to succeed with wooe we'll continue to evaluate it. if we think changes are warranted, we'll do that as we have in the past >> what do you guys think of all this >> i didn't even realize this was a news story only insofar as i've assumed the morningstar ratings meant almost nothing. i understand from -- >> people still invest because it's a aaa versus single "a. >> they shouldn't have and shouldn't. >> what would you recommend in place? you have active management for every person -- >> i think that's the problem. i did a piece when i was at the "wall street journal" with the guy who gave leg mason, gave bill miller's thing five s

. >> well, joining us now, brett horn, a senior equity analyst at morningstar.f information security officer at sixtera brett, you cover the company and the shares are up 2.5% today do you think that he has quelled some concerns around the stock >> yeah, i think it's really just a case of no news is good news i don't think there was really any material new information that came out of the hearings and the market viewed that positively >> what about tomorrow he may be going up against senator warren, yes, if he's headed over to the senate? >> yeahing a i think he's going to continue to face very strong criticism and i think essentially, you know, going to congress and taking his lumps is him, you know, per tforming his last acta ceo. it's appropriate since this happened under his watch. >> leo, what's your take on what we learned from the company in terms of what was breached in the first place, what has been done to fix that now, and the fact that lots of americans have signed up for their protection going forward? >> right, well, we're seeing the aim old securi

. >> good point, thank you, morg morgan let's bring in a couple analysts keith from morningstar is also with us as well. tom, i mean, are we surprised, given the ambitions that amazon has shown in so many other areas that they would be thinking about this as well, right? >> sure, to me, this is attacking what is essentially the achilles' heel of the amazon business model it's their overreliance on u.p.s. and fedex you had a segment earlier, you were talking about pricing power as it pertains to netflix. these two companies essentially run a duopoly and raised price, essentially continuously, even in the depths of the recession in 2008 and 2009 so to the ex-tempt thtent amazos building out its own first party logistic efforts it, it attacks that cost center and improves their ability to not only have third party unit sales on amazon, which is 51% today, more than 50% for the first time ever in the second quarter, and i think it hits 75% long term but increasingly using their own first-party delivery asset to get those product to the consumer basically attacking the akchil e achilles' hee