see you at the top of the hour. >> all right, we'll get there soon now let's get to the cme for rick santelli's santelli exchange rick >> thanks, jon the one piece of the puzzle that seems to not quite fit right in an illogical counterintuitive pattern is the foreign exchange market, specifically the dollar. let's think about this a bit we have central banks literally leapfrogging each other to make sure they have enough stimulus to keep their currencies from getting too strong they don't want to fall behind the new leader, which in their mind may be the u.s., because it did a quarter point in july. but really, the leader is the ecb, eseptember 12th, we're expecting that there's going to be a stimulus package and there are hints that it may be more than many anticipate we'll have to wait and see but in the end, a weaker dollar does one thing and it's the one thing that the fed wants to want most it's the one thing that all central banks say they want most and that is, more inflation. they want more inflation but in the end, the problem is, is that a weaker dollar is very difficult for the fed t

let's get to rick santelli with the santelli exchange this morning. hey, rick? >> hi, carl. jackson hole has to be 110% totally preoccupied with all the strange things going on in the world and the yield curve inversion. this has just gotten to monumental proportions and i understand and i also understand that should it invert more and the rest of the curve invert more, more of the flatness it already has, indeed there could be a recession. but that isn't the danger. the danger is making this a poster child for, you must have a recession. i'll tell you why. the inverted yield curve is easy as pie, right? and i'm not saying pie like you eat, i'm saying pyrite, fool's gold context matters. because in jackson hole, hopefully they're discussing all the issues, and believe me, there are a lot of global problems that are getting exported here and it is affecting us but trade is affecting us and it's affecting us because it's the policy of the current administration to go after it, so it's a variable that the fed really shouldn't neutralize. if this isn't a good thing for the count

rick santelli, plenty to watch today. >> no matter what direction you look at, and the irony is justncredible university of michigan inflation numbers firm up. solid retail sales we're going to talk about how our economy differs from the picture beinpatebylog ind gbal drops in interest rates, after the break. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity. i felt completely helpless. trashed online. my entire career and business were in jeopardy. i called reputation defender. they were able to restore my good name. if you are under attack, i recommend calling reputation defender. vo: there's more negativity online than ever. reputation defender ensures that when people check you out, they'll find more of the truth, not trash. if you have search results that are wrong or unfair, visit reputationdefender.com or call 1-877-866-8555. >>> rick santelli. >> thanks, john. everybody loves a friday edition of anything. and this exchange is definitely one of my favorites. just because

by almost a percent at this point and the nasdaq is also down by about 1.5% let's check in with rick santellior the santelli exchange rick >> good morning and thank you. as i walk around the trading floors, even walking to the train, even last night in bowling, what do i get asked we're supporting treasuries. everybody's watching interest rates. more so than normal. because of the feedback loop that's been exaggerated of late into the equity markets. remember, historically, equity markets quake, flight to safety pushes, buyers and treasuries for safe harbor, yields go down. but if yields go down dramatically first, the stock market scratches its head, and that costs everybody who's holding long positions money and that dynamic is an important one. so where will the best support be in treasuries well, unfortunately, that's not an east as an fy an for a big r. if we look at ten-year notes, 207 was a huge retracement level, a 62% center. we are below that. so ask, there's going to be a lot of little support levels but truly, there isn't a really big support level until you test that double botto

rick santelli has the huge moves in the bond market bertha coombs is at the nasdaq seema mody has the latest on the protests in hong kong. bob, let's start with you. >> stock market is moving in lockstep with the ten-year yield. we had a big move in the yields. the s&p against the ten year, this is as close a correlation as you're going to get so the big banks all weak. we're also seeing the regionals weak as well dow movers, in addition to the banks and the industrials, you would think, would be weak we're also seeing some of the big consumer names a little bit on the weak side, so mcdonald's, walmart, and disney, great performer this year. keep an eye on that. that hasn't happened often at the same time. sectors are all trade-related. transports, retails, energy, and industrial wiffle mentioned some of the big strategists commenting citing a bigger hit from the trade war. morgan stanley says the bear is alive and kicking. ubs says new tariffs will slow growth bank of america says the trade war is hurting capital expenditures and margins they see a 1 in 3 chance of a recession in 202

or unfair, visit reputationdefender.com or call 1-877-866-8555. >>> dow's up 403 let's get to rick santelli and get the "santelli exchange". hi, rick >> hi, carl. i understand since history, i've been watching the markets since '79, that there are big issues and political issues and global issues that divert the market's attention. but what we've seen these days is much more than that it's almost as if the markets are pawns or held hostage. they've lost their signal in their gps with regard to many of the large central banking policies and they're very susceptible to moves for a variety of reasons just take today. so, we get our july read on consumer price index, up 0.3 on headline last month was up 0.3 on headline i personally don't think inflation or lack of it should be the major underpinning of policy in the world as it's currently put together but, having said that, when do you think the last time we had back-to-back up 0.3 in consumer price index was? i'll tell you, january and february 2001! we haven't had a back-to-back 0.3 since january and february, 2001 and if you look at year ov

let's get to rick santelli with the santelli exchange. >> equities are soft and so are interest rates today i see a 216 for 30-year bond yields on the 7th, we had an intraday low of 2.11. 210 from july of 2016 is the definitive area to pay attention to, the all-time low closing yield. listen, there's a variety of cute names we have for spreads on this trading floor. the first one, and i wanted to show you a chart, is the fight that's 5s versus 10s so ten-year maturity minus the yields minus the five-year maturity this chart is a one-year chart and as you can see, flat this thing is going flat now, as you can go to the next interesting name, knob, note over bond. it's 30-year bonds over ten-year yields that's hovering over 50. knows this chart this is a three-year chart notice it's one of the few, if not only subsegment yield curves you know, because you can combine them in a variety of ways, that is still really a steepening trade think about it the long end, which very few domestic investors have that much interest in, who wants to take the risk of surfing down the risk of the time o

let's get it rick santelli at the cme in chicago good morning, rick. >> good morning, carl. know, traders like this number university of michigan this is a preliminary read and it's a disappointment. 92.1 we were expecting 97, maybe a bit higher sequentially, our last final read for july was 98.4 92.1 is the second lightest number of the year the first being january, that was 91.2 so it isn't horrible but if you go back a couple of months, especially towards may, they were with the 100 anything triple digits is quite imf. a bit of a lslip there i like to look at the one year inflation outlook. 2.7. one-tenth hotter that's interesting if you look at the five to ten-year, also one-tenth hotter from 2.5 to 2.6. obviously, the people didn't listen to the last fed meeting back to you. >> but you did, rick santelli. thank you. our roadmap starts with the volatile week coming to an end what a week it's been. today as optimism here to stay or is a recession actually in sight? >> g.e. rebounding a bit we are going to talk about that with "new york times" pulitzer prize-winning jim st

rick santelli is at the cme. help us wrap our heads around all of this. >> it really is very confusing when the fed starts easing they view it as a cycle based on some history as you look at an intraday ten, we're down a half a dozen basis points sitting right at 195. that was the low the cycle low on july 3rd as you see on that chart. if you zoom back to the november of 2016, you can see that's the last time. here's the interesting fact. if you looked at the big move which happens so fast from 3 25 down to that 195 zone and you try to do some technical analysis in various fashions, 207 keeps coming up. even though we violated it since july 3rd that's been the average yield. so today's valuation again could have big significance, kelly >> in a nutshell is it fair to say that markets are going back to their -- and bob mentioned this the ism data lends credibility to this idea that the economy might need more support. are they just saying, hey, we're back to where we started the fed cut once but it will cut again a

economist and rick santelli. are the yields and the inversion of the-year-old curve, two month to ten year or the flattening of it, with respect to the two-year to ten year, is it telling you we're on the brink of a recession. >> it sends a worrying signal. it has for a while it's been sending a signal we're late cycle at the least. i would seemphasize a lot of the move, lately, even if you have a relatively sa relatively s relatively, global developments have been weaker and the decline in global rates is dragging down u.s. interest rates and it's also putting outward pressure on the dollar which may force the fed to respond i don't see signs that the u.s. is slipping into a recession right now. i do agree with what the market is saying, not only is growth prospects here diminishing by around the world falling faster. >> peter you cite a bond bubble that's scary to watch. we haven't seen this kind f of slide -- kind of slide in ten-year yields since the peak of the debt crisis in the united states, the idea that

speaking of rick, let's get the santelli exchange. rick >> good morning, carl.rview with dr. judy shelton, i received lots of feedback and much of the feedback was somewhat as follows. don't necessarily agree with dr. judy shelton certainly knows her subject matter and defends her stance and what most of these were referring to is the notion that what jay powell and company was trying to tell us in a press conference doesn't seem to jive with what many investors think the fed's actual mission was, will be in the future. and i'll explain if you look at the globe right now, dollar is the reserve currency but it's the reserve currency at a time where after the crisis, it's still in high demand and the high demand usage is mainly to fund various financial issues and structures, okay let's make it simple there's a lot of loans out there denominated in dollars dr. judy shelton brought that up to procure dollars and swaps, meaning if you want to convert your euro to a dollar, your pound to a dollar, your yen to the dollar in the forward markets, it's pricey and it's be

to the bond pits now, check in on all things fixed income with rick santelli. > good morning, david even though the ppi was a little light, on the year over year numbers, and on the core, what we do see is it didn't move the markets in an upward yielding direction or downward. basically unchanged from prenumber levels but what a day and what a week look at a two day of 10s, down one today, down 14 on the week two years are down one on the day, down 10 on the week pretty much have double digit drop in yields across the curve. we know the vix for equities, cboe has a ten year vix as well. it is an elevated levels that we haven't seen since february of 2018 even though it has come off a bit, especially come off some of its intraday levels from earlier in the week. but unlike stocks, you get a vix ty vix move option vol in treasuries, normally for downside in price, upside in yields that's where you used to get horsepower not anymore. it is in both directions and with all the buying driving rates down, being a nervous feedback loop, it is especially exaggerated the

let's get to rick santelli already a busy day at bond pits in chicago another busy day tomorrow. k. >> absolutely. you know, i just want to throw this out there i personally don't follow the market pmis as well as the more well-known pmis, but it did dip below 50, 49.9 is the read i thought i would point that out for manufacturing. now, let's get to the charts two day of two-year notes then a two-day of ten-year notes. what you should notice is beth of them are elevated whether it was the minutes that triggered part of it yesterday or esther george today, although much of that was already under way, and i think she just put a better footing under the notion that there is a whole world of people out there, some of them on the fed, who think that the july rate cut was a mistake. i think that maybe that audience is growing a bit look at the ten year bund today. this chart starts on august 13th the reason i picked august 13th is because there's actually some divergence going on today. we're close to unchanged ten year bund yields are a bit elevated from intraday trading at the highest

let's bring in rick santelli, do some myth busters on this tweet, rick. >> listen, i can tackle this in the most simple way. germany's highest court has had a number of challenges to the ecb policy and eu central banks' policies in general. two newer ones, one coming out in september of this year rulings. i will go over them quickly. giddy ness usually doesn't go along with court cases basically the eu's central bank policies were coordinated into what they call the eu banking union. it was created in 2012, to deal with the crisis. but the german courts want some kind of throttle or governor on that the second case is huge. is qe even legal under german law? and there has been many of these cases. the issue is they're not giddy, germans are actually paying for this countries have prolific spending italy, they're ten years lower than ours. who is subsidizing that? germany. they get full value on the face value securities that they purchased with funds injected in large parts by germany yet, if there were some in the local marketplace, they're not anywhere near that the long and short

. >> steve, thanks very much let's get over to the bond market now where rick santelli can weigh in with action at the cme. rick >> i tell you what august has a big history attached to it because the first three charts are historic. look at the shots europe, month to date chart. it's through minus 90 approaching 95 never been there before. italian ten year just think about the italian economy. it's under 1%. look at 30 year bonds. they started out the month above 253. they're now under 2% intraday of the doll alreaar inx it is surging. best level since may of 2017 which means the next chart euro versus dollar, it's a month to date, but it's also at the lowest level since 2017. and all of this brought about because we're the bas yan of proseccotive rates and tsunami of foreign investors bill back to you. >> how much longer we had a full mince minus 11%. >> i think it's coming quick should be there in a couple of sessions >> incredible. just incredible. thank you, rick santelli and coming up, lions gate shares hitting their lowest level since nuy jaar2012 we'll explain why next at fidelity

the culprit in all of this action today rick santelli tracking the action at the cme. rick >> it's not the culprit. it's the aftermath the culprits are central banks every maturity but two years looks to potentially close at a new cycle low. and in the case of 30-year bonds, all-time low. let's go through it. here's the two-year note at current mid-august low-yield close is 1.47 going back, as the chart goes to october 2017 you can see the little tang on the right-hand side, that represents the low of the cycle. look at five years going back to november 2016, 1.41 was its own cycle low. right now we're at 1.38. july 2016, for tens, 1.53 currently we're well below that, and finally, 30-year bond, there's a 20-year chart, 1.97 is the current yield close. we're going to beat that no matter who you slice it, for whom the bells toll, we can definitely argue about all of the issues of trade, but at the end of the day, $16 trillion of negative rates, if there's a recession to come, i would think that that would be the antagonist melissa lee, back to you >> rick santelli, quick

. >> let's get over to rick santelli >> short ends down a few on the day. the long ends up a few look at the year to date, 10s minus 2s it's positive now. 5, 6 we closed basically at zero. never went negative. 30 year bonds are down 26 on the week but they are up a few on the day. this is a mid july chart it has been a swoon and finally dollar index normally goes down when you have swoons but look at this chart from may 2017 we're not far from fresh 27 month highs. back to you. >> thank you very much >>> we've also seen big trade head lines moving the market and kayla has the latest on them >> trade headlines could continue to move the market in coming weeks prlt saying he has a call scheduled with china president. the president got an earful on wednesday about this from ceos of three of the country's biggest banks. steve mnuchin put them on the line and they proceeded to have an impromptu 20 minute dus cushion about the economy where ceos said trade uncertainly is hurting business investment. a source says the president was receptive to that argument but h

i want to check that move from the mexican bank central bank >> thank you very much robert and rick santelli is tracking action at the cme some and has been some action lately, rick >> oh, there's action every day and today's action's particularly interesting as you look at an intraday chart of boons, we've seen they plumeted before their close. what was going on there? i'll tell you what my version of story is finnish governor, bank of finland, also a rate set iting b member, did a "wall street journal" interview several hours ago and basically i'll paraphrase what he said. he said many may be surprised at the stimulus that's coming in the september 12th ecb meeting this follows a pattern lately of the ecb getting in frontof everybody. whether it was putting pressure on power before our meeting and these issues are really at the epicenter of what's going on with interest rates in foreign change and all of the connectivity there so if ecb is going to give more stimulus at the basic end of mario draghi's tenure before we get new leadership of course, then that is going to put even more pressu

jon fortt, back to you >> rick santelli, thanks and the "halftime report" is just moments away. wapner, what have you got? >> we'll pick up on the conversation that rick was just having the fed and the trade war. what should the fed do, if anything the former new york fed president, bill uply with an op-ed today. we'll talk to bill fisher on whether he agrees with what mr. dudley is writing. stocks up for the second straight day, twists and turns, wall street divided on what investors should do. and them our call of the day is on a reit that some of our it got a big upgra tdeoday we'll discuss whether it is right for your portfolio, "squawk alley" back after this break. >>> welcome back could a recession mean a revolution that is the new op-ed who writes that ceos should fear a recession. joins us now from mountain view, california good to see you. you are unimpressed with this business roundtable statement that the ceo said that they care more about the stock price you think they were really to get people to think they care? >> yeah. i mean, i'm not impressed because it doesn't

all at noon on the half cou court, we'll see you in about 15 >> let's get over to the cme and rick santellielli exchange >> hi and good morning is it our problem the world just loves our securities, like cake, they just love it! and the long-dated ones, not only on foreign buyers in love with it, institutions around the globe that need to match their future outflows, their payouts, insurance companies, annuities think about all of the payouts down the road that need to be accompanied with cash flows. and you look at the short end. the short end has the fed, t-bill issuance everywhere in sight, especially right before and right after the budget deal. that's why treasury secretary mnuchin thinking about an ultralong bond is a wonderful idea if they want to eat cake, let's give them some cake to eat because all of these issues i've described have huge lly distortd the yield curve? how do we get our gps back how do we know when the global feeding frenzy that keeps the dollar firm and keeps treasuries well bid and keeps treasury lows making it very hard to handicap how our economy will have to b

now to rick santelli in chicago for a look at how bonds are reacting you know, it's basically no reaction to speak of it's some intraday charts, two-year at 154, basically at the top of the range, tens around 156 they've lost ground, excuse me, which leads me to the next chart. tens minus twos, i don't think the inversions mean what they used to. i urge people to look at kelly's interview with dick boy va, it was like out of the ballpark it was flattened, now it's kind of two, three. i even saw a trade briefly under two, and finally, the dollar index, you talk about a steady eddie intraday chart there's a lot more going on than just treasuries. fed funds are selling off a bit, so are short-term rates like your dollars, why, taking out a little of the easing and the market's taking all of this quite calmly melissa lee, back to you. >> we gear up for jackson hole starting tomorrow. tom por chel lee is chief u.s. economist with rb capital markets. tom, i'll start with you the fed officials seem like they didn't want to make it seem like there were more rate cuts coming how do you interpret a

let's get out to rick santelli in chicago. >> thanks, jon, you know, yesterday i didn't get to weighvily on ex-new york fed president's dudley's comments cnbc did a wonderful job in that regard and pretty much everybody i deal with on trading floors was pretty much dismayed that a fed member of that high order and being a head of a new york fed is a key post within the organization would have and harbor such political issues, i'm sure they didn't just crop out of left field after he left, but does it really matter? the president does things that are a bit unusual with regard to how he communicates his thoughts to the fed i'm more interested in the fed's response the response was the right response basically, forget all that stuff. maximum deployment and price stability. the problem is that's a bit of a stretch too. if you look back at central banks and particularly our centralback, they really went way over their skis if their two pillars is the only thing that's supposed to give them life with regard to how they interact in the marketplace. indeed, they and all central banks have ro

david, back to you >> still trying to figure it all out, too thank you, rick santelli now let's send it over to jon fortt with a look at what's coming up on "squawk alley". >> tech got hit hard yet so we have some tech experts and china experts today to determine what comes next, how to position that's coming up next on "squawk alley. here, it all starts with a simple... hello! -hi! how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! [ camera clicking ] wifi up there? -ahhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your xfinity store today. >>> later today, former cantor fitzgerald ceo sean mathews will join us to talk about this wild market action. and after the bell, we'll get earnings results from disney and wynn, both important both have some china angles there. it all starts at 3:00 p.m. eastern. though for disney, i guess, david, as you mentioned, the big question will be, is all the optimism about d

good stuff rick santelli.tc speaking out about facebook saying the company's plan to merge whatsapp, messenger and instagram could hamper plans to break up the social media giant. he said if they maintain separate business infrastructure, it is easier to have divestiture in that circumstance this comes as the journal is reporting a group of states are preparing to move forward with a joint antitrust investigation of big tech, this ftc shares making some comments with increasing frequency. >> yeah. i think that when i read the state's attorney general, they're tag alongs, but the ftc is so aggressive hard to believe that that agency has come to the fore they're just everywhere. they're tough. >> yeah, long-term nature of these investigations can't be emphasized enough. so you wonder what the discount will be on the share prices, short-term, if any. >> yeah. >> outcome that is uncertain and a long way away. >> right. >> but could result if it were fines, split up the company. some argue that would be -- >> ftc,

. >> let's get more on the sell-off bob pisani has mork on the -- bertha comment, and rick santelli is watching the yield curve inversion. wilfred is monitoring how that will impact financials bob, let's start with you. >> of course we're concerned about the yield curve inversion. it's an effect, not a cause. the immediate cause of all this weakness is global economic data that's been weakening. more of that day today german gdp actually down 1.0% after being up slightly in the prior quarter. the market trend leer, there's a bit more than that there's a couple other issues weighing on the markets. there's some though -- nobody doubts that it won't help, but will it help dramatically? and the bigger questioner for the markets to handle. >> thank you very much let's get to bertha coombs , on pace for the worst day since august 5th, though still above the lows of that monday. today we're seeing a broad decline with biotech down just a bit less than tech among the biggest loser, amd, tesla, apple, all of which have potential. you'll he -- biggest customers holding back meantime, 280 near l

rick santelli, thank you >> got higher treasury yields, higher stocks with all the major averages up 1% or greater. lots of green across that board as you can see right there s&p, every sector is higher. sh've got veteran trader art ca joining us on this morning's rally next stay with us snhu lets you transfer up to 90 credits toward you bachelor's degree. - [woman] it doesn't matter how old you are, you can do it, you can finish. - [spokesman] finish your degree at snhu.edu i felt completely helpless. trashed online. my entire career and business were in jeopardy. i called reputation defender. they were able to restore my good name. if you are under attack, i recommend calling reputation defender. vo: there's more negativity online than ever. reputation defender ensures that when people check you out, they'll find more of the truth, not trash. if you have search results that are wrong or unfair, visit reputationdefender.com or call 1-877-866-8555. how you watch it does too. tv just keeps getting better. this is xfinity x1. featuring the emmy award-winning voice remote. streaming ser

rick santelli is tracking the plunge in bond yeels bob pisani is here at the exchange but steve, let's begin with you. >> thanks, wilf. a signal heard around the world as they cut interest rates, that was part of what send bond yields careening downward, eventually taking stocks with them possibly a race to the bottom on rates leer in fact, president trump encouraged the fed to match rate cuts today they've been cutting rates and doing so since at least april and some even earlier than that. the fed knows it can't maintain a rate so far apart, but the problem is if it cuts other central banks could cut even more >> steve liesman, thank you. >>> ten-year bond yields falling to the lowest levels since 2016. 30-year yields closing in on record lows. rick santelli has more. >> if there's any sector or specific part of the markets that should get a fist bump today is this next chart ready to challenge the 210 all time, low close that was established in july of 2016, same month the ten-year notes had the double bottom at 136, but it was avoided we're close to 220 now, really took the pressur

and a major drop since last week's fed meeting we're going to go out to rick santelli in the bond pits when "power lunch" returns. >> and now, the latest from tradingnation.com cnbc.com and a word from our sponsor. >> there's a classic investment thesis called the dow theory it says that transportation stocks can either confirm or deny a broader market trend. but it's important to remember that transports can be sensitive to changes in oil prices and other market influences. so don't rely exclusively on this theory when making an investment decision. i'm randy fredicerk, and schwab is the better place for traders. (vo) that's why verizon lets everyone mix and match different unlimited plans. sebastian's the gamer. sebastian. this is my office. (vo) and now with more plans, everyone gets what they need without paying for things they don't. new plans start at just $35. the plan is so reasonable, they could stay on for the rest of their lives. aww, did you get that on camera? thanks, dad! (vo) the network more people rely on gives you more. >>> so far, it's been an ugly start to august fo

rick santelli tracking all the action at the cme. ick. >> hi, melissa lee boy, what a difference a day makes. let's look at ten-year notes from thursday. why thursday thursday's intraday low is 147, but the close was 1.53 the lowest close going back three years as you see on this chart. let's overlay s&ps on it, and bob pisani always brings this up boy, are they correlating, and certainly it looks as though today, treasury rates and global rates led the way. if we look at what's going on overseas, the two-year shots, the two year note in europe, for the second time thursday and today had an intrady low of minus 91 basis points. finally, two-day of the dollar index, it's been going up almost every day. today, it came very close. 98.40 to the 98.52 closing high. it backed away a bit tyler, back to you >> thank you very much rick santelli in chicago >> coming up on the tasting menu, a tesla tout a town's ransom, and hitting the road we'll be right back. memory support brand. you can find it in the vitamin aisle in stores everywhere. prev

. >>> now let's get to the cme rick santelli has got the santelli exchange. rick >> thanks, jon i can understand where all the ire is coming from let's be honest here, if we look at three charts, we can understand why the globe would be nervous first chart is a month of ten-year note yields and how precipitous the drop has been. one of the main reasons is the precipitous drop in europe, whether you look at bound yields or guilt yields, wee see the same dynamics, the same basic patterns the only thing different is the scale. but let's take a step back now, i've discussed this with my guest today. we are a consumption-driven economy and most of the big economies in the globe are export economies we all know this intrinsically, but it makes a huge difference at the end of the day, many have said, we should look toward europe or allies with respect to trying to address the trade infractions that we have with regard to china. i wouldn't hold my breath, personally but what i would say is this that point of view really matters. you know, whether you're buying a house

. >> all right, to the bond pits rick santelli at the cme group in chicago good morning, rick. >> goodg, carl. everybody is talking about it. let's get it out of the way at the top. yes, we saw 30 year bond yields in europe issued basically discounted, meaning you're going to get less back i guess you would say premium. but whatever the case, it is traveling down the curve we had a ten year bund auction now we have a 30 year bund auction. and these aren't good developments i would actually rather hear this is the end of it, versus this is the beginning. but as we line up to see what size weaponry we fire that liquidity gun in europe at the ecb meeting on september 12th, markets are getting ready for it hopefully we'll hear something about it from the jackson hole get together look at a 24 hour chart of 10s one week of 10s. yes, we're up a bit on the day it is more of a consolidation move and it is global. look at 24 hour bunds, difference with tens, came off its higher yields quite quickly. if you look at a year to date of 10s minus bunds, it is narrowing. this isn't a good thing. we w

later in the day, brian sullivan for us in hong kong. >>> let's get to the cme group in chicago rick santellitelli exchange for us. hi, rick >> hi, wilf. thank you. it's been a very interesting morning. a litany of data in the form of industrial capacity utilization, everything was solid. maybe even a little better than solid. the retail sales numbers, the control number, these were all very good metrics. but yet, markets didn't seem to pay a whole lot of attention we had knee-jerk reactions in treasury rates that popped up a little bit, but basically, they can't escape, even into the bottom end of yesterday's range, which was an historic low point. but something did happen today look at some charts. look at the intraday bound chart. about a half hour ago, boom, really takes a nosedive. the euro versus the dollar, also a bit of a nosedive. and treasuries were affected, because, we all know, all stimulus is fungible what does that really mean i'll tell you what it means. ecb meets on the 12th of september. and ali ren, who is a member of the ecb rate-setting committee and a governor of the ban

and usmca has been on the dockets of congress for a while. >> let's get to rick santelli for a look at bond yields. key for where stocks are trading. >> yeah, definitely rhyming together it is hard to tell who is leading, but i can tell you who is leading the treasury, today it has been the short end. look at the two year note yields, notice it is the highest yield of the day if you look at the 10 or 30 year, they are starting to come back, but they have lagged but that 30 year bond right now is testing 210, a significant level. finally, the president mentioned the dollar being strong. he doesn't like it most americans like it, we get to buy things at a discounted price. dollar index very solid. back to you. >> yeah, rick, going to be interesting. jackson hole this week, i mean rick, i was asking earlier on halftime, what is more at risk, bonds or stocks. and i guess they both have a lot hanging in the balance of what could be said later this week. >> oh, absolutely. and i think that the center stage ought to be mario draghi passes the baton and anything that we learn about the next ad

let's get to rick santelli in chicago. morning, rick. >> good morning, carl. quarter point decrease in the fed funds rate from 2.25 to 2.5 now remains at 2 to 2.25. it might seem like a small amount, but it is one-ninth of our total amount regard to the amount of eases we have left, which is now eight and it's had a very strange effect on the marketplace. look at a three-day of two-year note yields. of course, most of their activity yesterday was to the upside all of a sudden, it is starting to break down. if you look at a three-day of tens t really jumps out at you we're now below all of the trading yesterday. we just broke under 2% if you recall, the low for this move on a closing basis was july 3rd, 1.95 yield close. so we were within a handful of basis points of challenging that but the big beneficiary also very counterintuitive to a central bank that's easing is the significant pop in the dollar index and not only does it have a pop, as you see on this three-day chart, it has been popping for a while. right now look at the next chart, if we were to close

. >> to the bond pits and rick santelli at the cme. good morning. >> good morning, carl.a difference a few days makes. bob was saying it is hard to tell if interest rates have bottomed don't think it is hard to tell they have bottomed the question is how long will this bottom be sustained and there is some things we can look at to give us the answer first of all, the curves resteepen and remember this double asterisk at the wall street journal and many seem to have forgotten the curve never closed inverted. it was an intraday inversion so articles are talking about inverted curve really isn't now, can it get again? yes. but right now it is trading just under 10 base points two day of 2s. they're up a bit look at formation left side to right side, it is up four basis points to the long end of the market, 30-year bonds, it is much different, yes, they're up six basis points, just like 10s are. the reason i picked 30s, this is one area where you can really handicap if this bottom is going to hold for a while. let's harken back to june of 2016 unlike ten year note yields, whi

morgan, back to you. >> rick santelli, thank you.only a few moments away a big market day scott, what's coming up? >> everybody is getting seated for the big show at the top of the hour we'll look at the stunning drop in yields today. the volatility in the market our investment committee giving their best ways to play this current environment. >>> plus central banks in a race to the bottom. how will the fed react to calls for even more cuts and the stocks and sectors to look at in the sell-off today. we'll do it at noon. a little more than five minutes away morgan, see you in just a little bit. >> sounds good, scott. thanks >>> watching the rush to safety with the two-year 10-year at the lowest level since 2007. this is flashing big warning si signs. this increases the possibility of recession to over the next 12 months to 50%. moody's chief economist mark zandy joins us along with former wells fargo chairman and ceo richard kovasovich mark, why? why do you think this increases the risk to 50% of a recession >> over 50%. i think the

let's get over to the cme now and rick santelli with the santelli exchange. >> we will start with tensthere was an inversion of close to two basis points. it's righted itself to some extent, but the psychology behind that and the history behind it is going to make it very difficult for investors to overlook as for 30-year bounds, also big things going on for you, options traders out there, just talk to the options pick the skew, the call skew, let's make this easy when you buy an option, you pay a premium, volatility goes up. those premiums get bigger. the premium to buy calls is now at cycle highs in 30-year bonds. why is that important? because it most likely means that the trdrop is going to be more substantial now, as you look at some charts, look at a year-to-date chart of what's going on with respect to the note over bond spread. now you see on year-to-date that it's mostly been climbing, but you'll also as of june 1st chart, that it's starting to dip. it's starting to shrink. look for that dynamic to mostly continue, maybe even feed on itself to some extent. then the dollar whic

things pretty busy there rick santelli join us from the cme group in chicago good morning, rick >> good, david hard to imagine that yesterday this was kind of like the crime scene, so to speak all the volatility in the interest rate, sovereign debt complex, spread movements, volatility, ty, vix, all really started to flash yellow. inzee indeed, they should. we have a lot of lingering issues but it certainly has settled down let's look at a one-week chart of twos. you can see how we had the big drift. now we're stabilizing. you could see it in ten years. what's really fascinating is you look at that ten-year chart, we had a 1.59 intraday low yesterday. here we sit right now at, what, 1.76 so how do you make 1.76 look like a high yield? you start at 1.59 because on the 31st of july, we're still above 2% let's not say it all just disappeared. if you look at a 30-year, same scenario intraday, 2.11 currently at 2.28. on july 31st, it was above 2.5%. so you get the idea. we certainly did have a big move, but i think the 30-year bond continues to be at least, for many, including me, the canary

bob pisani is covering all the action, rick santelli and steve losman bob, let's start with you. >> wilf, quite a rally the s&p 2932 where we closed on friday we've come all the way back, 2932 we're essentially flat since the friday close that's about a 5% swing. that is an impressive rally. the movers today, it's all the cyclicals. chevron, exxon they were down 8% the last few weeks. modest bounce in the banks jpmorgan was down 8% in the last week or so it's bouncing a little bit, not a lot. nike was also down 8% in the last two weeks that's come back a little more in the last several days of the caterpillar, some of the industrials barely bouncing. caterpillar down 10% the last week and a half, a little bit on the upside today finally everybody loves utilities and rates. i'm tired of hearing about it. the problem is, they're small, 3% of the s&p on utilities, 3% on reets, can't move the index with those back to you. >>> let's bring rick santelli at the cme group with a look at what's moving in bond world today. bonds ticking higher today what do you make of it >> they held all their ga

rick santelli with the santelli exchange and the storm that is brewing in the bond market rick >> yes, definitely overcast down here today, sarah, to be sure. what a time for a first appearance by my next guest. mizzouho steve economist, stevesteve , i'll summarize we have ten-month after a 25-basis points cut by the fed we have very little curve influences today two-years are down 11. 10s are down 10. steve, what do you see out there and underscore that with all the trade issues that seem not to be able to be resolved anytime soon >> well, i think the clear message that we're getting is we're going to go back and re-test the 150 level on the ten-year note. we've repeatedly tried to break through that in the post-crisis environment. and i think we're going to go back to test that level. i think we're probably going to fail at that level unless things get enormously worse from where we are right now and i don't envision that happening. i don't believe what's happening in terms of the trade situation is going to be enough to bring the u.s. economy into a slower growth trajectory. i thin

the cme group in chicago, rick santelli with the santelli exchange. >> thanks, mike.eacon for the fixed income sector, this is the man. jim grant of grants interest rate observer, let's get right into it. i don't know listen, i don't mind the president yakking about the fed as long as he doesn't make policies or do anything crazy directly to the fed. the latest tweet, he is envious of the ecb and european central banks. that is way out there in the fat tail range of logic. your comment >> well, i think he is talking his book as a former leverage real estate speculator indeed, if that were the case, you would want the ecb on your side >> well, the problem with the ecb on the side of somebody who wants to borrow money cheap is that in the end really many borrowers don't get fantastic rates. what they get is nasty returns on large quantities of paper that they are looking too keep quote/unquote safe >> oh, yes, indeed this word safe is kind of a puzzle you see it a lot modifying the word "government" and then "bonds" as if there is something intrinsically safe about a bo

. >>> to the bond market now, rick santelli tracking the action at the cme. y, rick. >> hey, an intraday chart gives you a lot of information we had a strong lei, but weak market pmi matter of fact, it was below 50 so at 9:45 eastern, that's the break you see. on august 1st, the other pmi, the ism and management, that was a 51.2 it was close to a three-year low, but still well above the minus 50 level under 50 that today showed up 12 points from 147 you see on the let. hey, only up what, six from 153. that's the low close one week of boons, up nine pr the intraday lows at minus 72. up eight finally, to lly dollar versus t. once again, a fresh dollar high going back to march of 2008. back to you. >> rick, thank you very much >>> volkswagen denies reports it's interested in a stake in tesla, but could the company be the target of a bigger automaker at some point? plus on our tasting menu, bleeding hedge funds, the bright sidey >>> welcome back volkswagen denying reporting, but it raises questions about what could happen in the future. phil >> kelly, it's no surp

>> thank you >> rick santelli, thank you! to a story we've been following here on "squawk alley. the government's jedi cloud contract, the pentagon and newly installed defense secretary mark esper re-examining the process of rewarding and the guidelines of the controversial up to $10 billion winner-takes-all cloud contract that following concerns from the president over mazon' bid. this is leaving a major military priority now in loimbo, a contract that was expected to be awarded in the coming weeks after oracle lost its protests the dod saying, quote, secretary esper is committed to ensuring our war fighters have the best capabilities, including artificial intelligence, to remain the most lethal force in the world, while safeguarding taxpayer dollars also adding that no decision will be made on the program until he has completed his examination. simo amazon, microsoft, the two companies that have been chosen toed by in this and oracle have not responded to cnbc's request for comments, bun it really does get back to the heart

. >>> meantime, let's get over to the cme in chicago for the santelli exchange. rickgood morning. thanks, wilf you know, we have a lot of wild months i've been doing this a while, traded a while but boy, this august really, in many ways, takes the cake. first of all, for all you kind of interesting technicians out there that look at strange things, and i've always thought, technicians, you could overlay astrology, there's a lot of wild areas of technical analysis. and many people will roll their eyes but i will tell you this that anniversary dates are considered very important for those who follow the teachings of wdgan inadvertence dates we had an anniversary date in august the first treasury future was born in august of 1977 and august sometimes get wild. anniversary dates get wild and this one is no exception if you look at the following chart, i hope we're showing, it's the month-to-date of 30-year bond yields. we settled the last day of july at 252 the low close was 195. we had intraday levels down as low as 191 if you really want to get pick, about 56, 57 basis

we're going to send it over to rick santelli for the bond report rick >> we had really good data points today outside of the industrial data. retail sales, philly fed and empire but treasuries doesn't pay attention. a two-day of 30 year bonds still down six basis points and drifting back toward the low and one week of tens and down half a dozen basis points and boon year-to-date is stimulus at the next meeting and the dollar index and nasdaq trying to stay in the green >> looks like it is trying to firm into the close. cisco has been the big drag on the pace for the worst day in six years but seeing a lot of other companies that are also suffering today on concerns about slowing. j.b. hunt, eight months of shipping freight down. eight straight months. also american airlines, concerns there about slowing as well. potentially when it comes to flights hitting a new low. 337 new lows today a lot of them did turn around this morning particularly small caps like children's place and we did see a turn around in the big caps today on netta yesterday's biggest decline or one of the biggest decli

let's get out to chicago with rick santelli. >> thank you, mike looking at a one week of two-year notelds, it is friday the 16th all the way on the left of the chart a low close. why is that important? only maturity not making a new cycle low. look at bonds from july 2020 we had a bottom in 12. bottom in 16 right now it's hovering at 1.47. getting very close to all-time territory. everybody's nervous about the negative yield yourve. since june they're positive 22. we are negative. they'd rather have our economy frank, the nasdaq seems to be dipping into the close. >> rick, that's right. we have on the bright side costco with the best day on the ndx. best day since march following the smash opening of the first store in china the stock also on pace for its best way since 1998. tech having a mixed day today. the chip etf flat down fractionally right now amazon with one of the worst days on the ndx. now over to bob pisani at the new york stock exchange. >> another day with lower bond yields bringing stocks down. banks down oil stocks still down even with oil up this is a theme for the pas

with rick santelli tracking the action at the cme. at did wlern, rick >> really amazing when you look at what's going on around the globe, the 30-year bond, anniversary dates between something for all you began and elliot waivers out there today happens to be b the birthday of bonds. on august 16th, 1977 that the bond futures were born it's different because tens minus twos never close before zero wednesday, which seems like a lifetime ago, they close d like .005. i know it's smant tick, but as a technician, closes are prioritized. a major difference that is they always u take away the punch bowl when you get curve inversions when the fed starts to act right? for inversions but the problem is is this time, they just brought us a bigger punch bowl it truly is different this time with rates dropping, long ends dropping faster. normally, curve inversions are because rates are going up in the short end leads. listen, we can all talk about it until we're blue in the face, but we can postpone the discussion because it never closed inverted.

. >>> to the bond market now where rick santelli is tracking the action after the awful seven year auction earlier rick >> yes, we often don't show a seven year but as you can see at 1:00 earn, it spiked up a bit as all maturities did we saw tens to twos flirting with zero. if you blinked, you misseded it. but the real issue is we have a rebalancing going on there's an impetus to get in front of what's going on or we're going to selling in treasuries and buy in stocks and getting in front of it is another game in and of itself. look at intraday of the dollar the high is 98.55. the current high back to may of 2017's 98.50 now even though we backed away from that level as you see on this may 2017 chart, it's a big day. the euro's at fresh 27.5 month lows and it just underscores that when you have a good econo economy, 2% might not look great, but it is, it's doing well and showing up in the strength of the dollar kelly, back to you >> thank you we've got a news alert on story we've been following with amazon on monday's "power lunch." "wall street journal" laid out his investigation into thi

let's get over to the cme now and rick santelli for the santelli exchange. rick. >> hey, morgan, thank you. you know, there's so much interesting aspects to technical analysis, i've always been quite enamored with it and of course, the real trick is to try to blend the fundamental threads of what's going on, whether it's domestic or global economy, whatever sector you're paying attention to and see if you can get clues that cross-fertilize each other and i think my mission is to try to arm you, the viewers with a better strategy, to trade against the markets, better preserve your capital better and yesterday was one of these days that gives us so many learning experiences if you look at what happened yesterday, intraday. we had a low in tens a yield of 159, in 30s, 211 but you know what i always say the most efficient price of the day is the close and higher priority closes are even more efficient. so your daily and your weekly, your monthly and your quarterly. but intraday can be important, but you really have to do your homework and remember. okay, here's

let's get to rick santelli for that >> yes, a final read on august for university of michigan sentiment in definitely not as strong. 89.8 our mid-month read was 92.1. that now disappears. sequentially, that follows 98.4. so this is a large drop at 89.8. as a matter of fact, i will have to go into the way back machine. that is the weakest level since, oh boy, looks like about october of 2016. october of 2016. so not a pretty number with regard to michigan let's go through the inflation aspect, shall we one-year inflation outlook constant from last monday and mid month read at 2.7. five to ten-year constant with the mid-month read at 2.6. sara, back to you. >> thank you a little light there on consumer sentiment. >> our roadmap this morning starts with wall street's trad booth. cooling rhetoric as we close out a wild august. what should investors expect ahead. >>> plus, shares of ulta beauty plunging we will go through the quarter next. >> and the tariffs, a new round set to pikick in sunday we will take you live to to america's busiest port and one ceo who calls the threat to his busines