tv Making Money With Charles Payne FOX Business February 7, 2019 2:00pm-3:00pm EST
impact. neil: on the site right now? >> foxbusiness.com. neil: wow, i think it is charles payne's lead item. did you know about this, charles? totally out to lunch on this whole thing. charles: gasparino breaking news every day, this might be his top 10. neil: i don't know. maybe best we don't know. >> charles, venmo is part of paypal. maybe there is a stock story. charles: i'm in paypal. they have been going down recently. tell me more. neil: all right, my friend. take it away. neil, fantastic seeing you and ben stein together. it has been a long time. neil: is he really a great guy? charles: he is amazing. neil: be well. charles: good afternoon, everyone. a pretty amazing day so far. i'm charles payne. this is "making money." stocks are falling amid new worries about the global economy. we will go deep into the moods of these markets. mood swings over last month 1/2 have been amazing. big bank finance, bb and,
suntrust announcing a meg ba merger. is this the first of many bank deals to come? ivanka trump unveiling a new effort moments ago aimed at helping50 million around the world get ahead. we have that, a whole lot more on "making money." ♪ charles: in the last month 1/2 the market moved from panic, to manic and recently indifference. not just the federal reserve, we've seen sharp move from neutral, sentiment ratings for investors. this is the highest level since late jewel 2018. it asks how they feel in the market six months out. it is pretty clear individual investors think we've come too far, too fast this year. not too ironic the sentiment of many professional investors.
they missed this move higher and woulding loathe to turn around and voice optimism. seen up tick in bullishness just weeks before the december low. in this market rally continues we can expect individual to take their mind, which is lot more than we can probably say for the experts. stocks are falling. tech weighing things big time. twitter the big culprit here. more in the communications services but we consider them tech. monthly user count slipped. changes in the way they will approach the earnings calls from now on. joining me to discuss all this, the ceo of blau asset management. michael block, scott martin, cio kingsview asset management. phil, a whole lot of things going on. we were under pressure all morning. not a lot. european growth, that knocked
oust down. stuart varney, two leaders, president of china, united states, maybe not able to get together. i'm thinking down 296 ain't that bad? >> ended up being in same scenario, do headlines matter more than fundamentals? to me fundamentals weigh out. i have got to focus on facts. facts tell me, sentiment is not bad. some cases all-time highs. sentiments still strong. look at earnings season. earnings season continues to be better than expected. look at phenomenal unemployment data. you have to factor in headlines, maybe first time in my investing career. do i care so much about china, what might happen, three, four quarters out. do. charles: phil admits it is much that the headlines are so power
if you recall with these short-term moves being so dramatic that you can't really dismiss them out of hand. so we've got a lot of difficult things going on. even before today's news. it felt like the market hit resistance point. there was some anxiety out there. individuals betting anxious. professionals getting anxious. feels like we're in a different period. >> point out a few things. we gone back to manic from opening lines there. we'll find out. one day is not going to do it. what i see, beginning of the year, expectations were low. banks are out on earnings. nothing spectacular or dessays truss. cleared that bar. transports, tech names, intel no, facebook yes. there is lot of things going on. i point out aai data, new data came out last night, percentage of bulls rosepoints and percentage of bears fell nine points. these are not extreme levels. those are pretty big jumps week to week. charles: right.
>> tells me more people are getting off the mat, more involved. short term is dangerous. you have new money chasing moves. today they get gobsmacked they don't know what to do. in terms of fundamentals and growth story, europe is slowing down. we had the new forecast. that is not new news. that has been going on for a year. charles: do you think there is something political about it? i think bank of england are trying to browbeat the folks in the uk, can change their mind on brexit, and that they were browbeating italy to this. to your point it wasn't new news? >> if italian growth at .2% for 2019, where it is now, italy is still out there, economic minister, mr. tria, was out, no, no it will be above 1%. who is right? who needs to get a dose of reality here? i fear it is italy. charles: scott, i have to tell you, if wall street sincerely believed new tariffs would come
on-line next month, they would sincerely believed we would have another shutdown. i think we could add zero where we are. that may be a hyperbolic, but we wont be down 287 points. >> to your lead-in, charles, you're right this is different market than november, december. get the same headlines, 30, 60 days, ago, we're down 500, in the dow, maybe more. market psychology changed. what is interesting, the key is earnings. phil touched on it. company fundamentals are hanging in there. high single digit maybe growth this quarter, once earnings said and done. that is what i think we saw consensus towards the end of last year. look at the year. our research says we'll be 170 in earnings, say on the s&p. you put a 15, 16 multiple i think is fair. we're trading about where we should be. new data, better via trade deal with china, you have a reason for upside. charles: to that point, phil,
wall street coming in, some of these targets were not that optimistic, so, we really approach ad lot of them already. i'm wondering where wall street goes from here. do they sharpen pencils. we were wrong this year. go sideways rest of the year, we made high single digit move a majority were looking for? >> underpromise, overdeliver, right? that is every analyst theme. i would be rather more right than less wrong. this is the opportunity to consider i have to be data dependent, i have to be tactical now. euphoric wave of 2009 to 2017 is over. pick the right stocks, based on valuations, wait for the opportunity to buy things cheap. we're off the bottom. dead-cat bounce is over. the china situation might get rectified, earnings better than expected, but here is the critical point, at this point if we're at inflection point, how do you change the portfolio based where we are? active management matters.
more important, be selective and data dependent like the fed, you shouldn't get hurt. not overreflected but -- charles: michael, if we're in equities, you can't throw a dart. yesterday capri had a great report it went up. tapestry the rival, getting crushed today. half the banks stocks went up. half of them are still under a lot of pressure. people have to be a lot more selective and that is a lot more difficult? >> about fundamentals and economic taxes. i can run through examples, one company did well, others didn't. intel versus names in the sox. intel had poor earnings couple weeks ago. comes down to this, fundamentals and expectations. here is the thing i'm worried about here, plays to phil's point, stock active management is important. year ago we had big selloff at end of january but for the most
part rest of year was euphoric. they were riding tailwind of the knew tax bill. everyone was excited. raising numbers. raising guidance. expectations for q2 was great. we're running into two the quarters as compares. we can talk about where earnings going to be, are companies getting more optimistic, stock pick something is important. bar in general is pretty high. key to me, where is the bar, where is the upside surprise potential. what phil said about stock picking. my mantra, follow the growth. who can beat expectations. who can thrive in this environment. charles: weakness in this earnings season is revenues for back-to-back quarters. for the third and fourth quarters, revenue came in less than anticipated. is that making it easier or harder for to you find opportunities? >> one factor. it is more about earnings more about cash flow, dare i say qualitative factor, quality. what is management doing, where is the company going? where can we look out to see the
quarters going out? is their guidance credible. charles: sure. >> think about debt, corporate debt ramped up in the last two years. focus on the debt number. if company is not overleverred they will not take a big earnings hit f they're under levered, in some cases -- charles: determining factor for overlevered? >> earnings come down. >> that is a great point, phil. look at rates on debt, guys. everybody was screaming corporate debt picture q3, q4 last year. what happened? 10-year is went from 3.20. charles: goes to 2.70, "r" word comes out. if you get above three the fed has to get in and. >> it's a difficult chance, charles. to something phil mentioned earlier, virginia, hey, like how about bonds for once, how about gold, those will still be safety in the storm because of facts
rates are not going anywhere. gold is holding up even in january as equity markets rose after having great december in q4. i'm long bold, charles. we're still hanging on. charles: guys, fantastic conversation. phil, michael, scott, thank you very much. we'll follow the market selloff thought the hour. right now the dow is off 307 points. not even bb&t, that suntrust megamerger creating the 6th largest bank helping the markets. the question is this, what will be the next one in the pipeline? my panel has a few ideas after this. the latest innovation from xfinity
charles: shares of both suntrust and bb&t higher on news these two regional banks will merge creating the sixth largest commercial bank in the united states. now of course the floodgates have opened. everyone wondering who will be the next buyers, who will be the next tar gets and here to discuss all of this, keith fitz-gerald and danielle dimartino booth. keith, let me start with you, a lot of stocks trading pretty good today. a whole list of potential names could be acquired or names that could merge with each other. certainly the race has begun for the megabanks, now. >> it has. once again the law of unintended consequences. they raise the threshold for too big to fail. you have two things going on. big banks, looking for smaller banks. boost assets, or under disposal
so they become too big to fail and shift to technology under mobile is underway. bb&t is logical target. institutions increasing holdings and i think someone will make a run at them. charles: danielle, last month the fed said, you know what? we'll tough end up the stress test. we'll forget about the low level. extremely severe outcomes. i have always thought they were a joke to be quite frank with you. like yelling fire in a crowded theater. you can't, no way to model that, when people panic it is hard to understand what is going happen but what role does that have to play what role does changing winds of the fed around by the way to keith's point, the fact too big to fail, these banks got bigger and other smaller banks know they have to get larger to compete now? >> they do. and you know, it is interesting. mary at jpmorgan chase brought up an interesting point recently, if you're going to have to comply with the new world out there, even though the trump administration has done a good job bringing down a lot of
regulatory regime, you need to have scale in order to have the technology that you need to compete. so i think that, there is very low-hanging fruit in the rural banks. that is going to be the case. there are 6,000 banks out there. it is time for them to consolidate. but i think today's deal shows us that some of these mid-sized banks, look at, for example, comerica bank today or huntington, they're up, three, four%. i think look at some banks, they might be ripe for being targets despite the fact they're as big as they are. i think scale matters going forward, charles. charles: people will be concerned, danielle, if the services will be the same. you know, anytime there is a serious of mergers in any industry, you wonder will the consumer demand the same type of service they have come to expect it, particularly this merger. we'll see a lot of banks close. there will be less people to help handle these accounts. is this unintended consequences
of saving these banks? now, banks out there know you have got to get bigger, you are insulated from the next serious economic crisis in this country? >> you know, that is, i have seen some comments today on my twitter feed, and there is some moaning going on. there will be a smaller footprint, fewer branches. you're going to hear that, but to your point, you have to have significant size in order to compete and, if, that is going to mean, coming in and creating a megabank in charlotte, now charlotte is once again the second largest banking hub. it has taken the place of san francisco, after this merger goes through. if that is what the cost is going to be in order to survive and compete, i remind you, charles, it is not just competing here within the united states. it is also competing in a global landscape with international players as china's biggest banks get bigger. that is what it is going to take, that is what it is going to tank. charles: keith, in general the
banks last year were a bust. supposed to be a easiest trade last january. every maven on wall street said buy bank stocks. they didn't live up to expectations. so far early in the year there has been an okay bounce. as an investor does this help investors or will we see these banks relying on more gimmicks, rather than good old-fashioned lending? >> i think it is the latter. they will rely on more financial engineering. respectfully to the fed's point, the stress tests are a joke. it provides answers in advance. it teaches them how to get farther away not closer. this is like dog eating my homework. people should red flagging what is going on. this is not a good development when it comes to concentration of risk. to me avoid the financial sector with very, very few exceptions. >> danielle, keith, thank you both, very, very much. really appreciate it. >> thank you. charles: short time ago ivanka
trump launching the white house global women's empowerment initiative. we have details and challenges ahead. howard schultz is on college campus warning students about the dangers of socialism. what can go wrong? we'll be right back. ♪ each day our planet awakens with signs of opportunity. but with opportunity comes risk. and to manage this risk, the world turns to cme group. we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances.
charles: fair amount of pressure this morning, dow jones industrial average near the lows of the day. to recap for you, we came in under a fair amount of pressure. uncertainty of yesterday. it wasn't anything dramatic. we got report out of europe, first from the european commission, lowering their estimate, their growth estimates for the year. later on the bank of england doing same thing for the uk and sort of warning that brexit could actually be really, really harmful, not just to the uk, to entire global economy. that set the stage, further pressured by larry kudlow's comments with stuart varney, how close we may or may not be with a deal with china. finally reports out, maybe president trump and president xi
will not have the opportunity to meet before his deadline. so will tariffs go higher. meanwhile president trump speaking moments ago. let's take a listen. [shouting questions] >> there could be. i hear they're working on something. we'll see what happens. but i certainly hear they're working on something, and, both side are moving along. we'll see what happens. we need border security. we have to have it. it is not an option. we'll see what happens. >> [inaudible] >> he is an outstanding person. i would say if he did testify he would do very well. he is an outstanding person. a very, very fine man. thank you all very much. >> make your way out. let's go. press, let's go. >> that i don't know. [inaudible] >> press, let's go. charles: president trump,
responding to some questions of course with respect to the shutdown, saying that both sides are working on something, and of course, remains to be seen. earlier today we heard from senator shelby who met with president trump, he was more optimistic, a deal could be crafted. meanwhile president trump comments coming as ivanka unveiling a important new white house initiative. aimed at helping women in developing countries worldwide get ahead financially. the project is called the women's global development prosperity initiative. will provide services like job training, financial report, legal reforms to as many as 50 million women over the next six years. in an op-ed in yesterday's "wall street journal," ivanka wrote, when women are free to thrive they bring national stability as well as more job's, economic growth, economic participation as potential to boost global economic output by additional $12 trillion, by 2025. we have beverly hal berg.
i didn't know president trump had 2017 national security strategy to recognize women and their critical role achieving global peace and prosperity. obviously the administration has been working on things like that already behind the scenes? >> when you look at his initiative here, part of it is a national security initiative. wanting to focus on improving the relations of people in countries that are very violent of the we should fight for women to have the same opportunities i have in this country to start a business. that is important. unfortunately, while i think the heart behind this initiative is correct, i don't think it is the place for government to do this here is the reason why. when you do have foreign aid, traditionally it gets into the hands of the wrong people or it doesn't know how to meet needs on the ground that very drastically, not just country to country, city to city, town to town. while i like what they are trying to achieve with this initiative, sadly i think it could do more harm than good.
charles: what about something like the marshall plan? that seemed to work pretty well. how do we help, help people in these other countries? by the way, economically, obviously we want to see these nations prosper. as the world's middle class was building out over the last 20 years, we saw incidents of war and human poverty, misery actually decline precipitously? >> yeah a lot of times because these countries are doing it on their own. also because they're looking to other countries to lead by example. so one of the best things the united states can do is lead by example. show that we should treat all people here with dignity and respect so they can improve out comes of their lives. when it comes to opportunities to start businesses or make more money in their jobs. there is another part of this. that is the importance of non-profit organizations which do far more good, when it comes to international crises or just on the ground when it comes to the needs that are there in so many of these countries. it is non-profit agencies tend
to do so much more. i will say when it comes to the initiative i am encouraged by the fact there is a public/private partnership. pepsico getting involved. ups is getting involved. it does seem to have a clear strategy how this money will be used which is often missing from past types of foreign aid being funded. charles: right. >> the heart is there, but i think there are other ways to achieve this without government funds. charles: without a doubt we don't want to see u.s. taxpayer dollars end up in some dictator's swiss bank account. >> exactly. charles: alexandria ocasio-cortez adding some meat to the bone if you will with this new green deal. it has got some people, you know, some people are pretty upset. some are worried. some think it is too farfetched. banning fossil fuels has been progressive idea for a long time. eliminating all cars. rebuilding every building in the country. eliminating air travel. replaces with high-speed rail.
government guaranteed jobs. healthy diet. no more meat. make sure everyone has a home and economic prosperity. grandiose utopian type dream. a lot of people are clinging to it, gloming on to it, beverly. >> many democrat candidates saying this is what they want. you have seen nancy pelosi pull herself away from this. i think for two reasons. one, i don't think she likes the star of aoc is rising, wants to take some of that glory back to herself, she knows legislatively to come out with major, major packet, by the way i can't wait for the cbo to score it. let's see how much it will cost. she knows legislatively this isn't feasible at all. some areas you mentioned. talked about giving free money to people unwilling or unable to work. really runs the gamut. people need to know the car you're driving now, air travel you currently enjoy, she wants that to go away. charles: ed markey cosponsoring it with her. he has been and a long time.
beverly, thank you very much. >> thank you. charles: we lost a member of our fox family. fox news legal analyst and nevada real estate attorney bob massi has died of an extended battle with cancer. he was 67. his show "the property man" was a staple on fox business network. he excelled in a lot of things, a stand-up guy, a wonderful person. our thoughts and prayers go out to his wife lynn, three children and six grandchildren. cause thee customize my insurance, and as a fitness junkie, i customize everything. like my bike and my calves. liberty mutual customizes your car insurance so you only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ because when you want to create an entirely new feeling, the difference between excellence and mastery, is all the difference in the world.
talk about what really is implied there. also, today, the battle between socialism and capitalism, it keeps ratcheting up. it has taken center stage. one of most well-known socialist models collapsed. socialism meets capitalism. panera bread tried the experiment. closed last one, pay as you go restaurant? remember that, the conceptual loud customers who could afford to pay, whatever suggested donation would be, they would pay, you know, ideally some would pay more. that would make up for people who couldn't pay any at all. now, quote, no longer viable. so where do we draw the line? this is not going to go away. "wall street journal" editorial writer jillian melchior with us, and "daily caller" editor-in-chief, chris bedford. the panera bread, i thought the panera bread ceo came out with this. he was taking victory laps.
this would revolutionize everything. capitalism in itself was not right. there was something else there that corporations could make money, everyone could get fed and we would be a better society. it doesn't work out that way. >> i think one of the really interesting things to point out here is people didn't want to do this particular model. but i do think there is somewhat of a appetite for -- charles: is that pun intended? >> i do. giving usa, one of the really interesting things, 2017, most recent year they looked at, charitable contributions are up 400 million. it's a record-breaker. 70% coming from individuals. the reason is the economy is better. people are getting lifted up this pulling others up with them. i don't think they want to do redistribution of wealth at the salad bowl. charles: right. >> that is not really appropriate way to do it. panera bread is trying to capitalize on social justice mission. it is in it for its own brand. people are not buying it. they're donating elsewhere. charles: in every, by the way in
that report, wealthy were up, the endowments, donated more, corporations donated more. everyone dug deep near their pockets, in part, because jillian is right, chris, we had more to do. but the idea a lot of businesses are tinkering around with the idea that you can change the business model itself to have more socialist component to it, thereby making better for all of society? >> that is hard to do just like socialism. it deals with human nature. charity, incites goodness in people. what can you give. it doesn't incite badness, which is how cheap can you be which is what is going on here. beyond that there is dirty little secret to charity, a lot of people give a lot of money, like to be around a lot of people give a lot of money. like to go to galas, part of the club, like to do this or that. to spend your lunch hour in boston or wherever you were, eating in homeless shelter for extra den dollars on your sandwich, that model woo not
appeal. if panera said we hold a gala, help pay for the food kitchens that are good. that is old-fashioned charity model. that might have worked. this one not how people wanted to spend their money or their lunch. charles: howard schultz is pushing back against some of the far-right ideas. he talked about the social responsibility. he is part of the conscience capitalist movement. he would like to rebrand capitalism as well. >> i think a lot of these companies are afraid what happens if they don't rebrand capitalism. i think a lot of americans are bitter at one percenters don't realize these things are endowing hospitals, endowing higher education, doing a lot more efficiently. i see where you're coming from. i'm actually thrilled he is part of the political debate right now. you see the left is going so far left, they're veering so far into socialism, it is really helpful to have somebody come in say you know what -- charles: six months ago you thought would be the guy, oh,
boy, here comes socialist howard schultz. you know what i mean. >> sign of the times that he is the voice moved race right now. charles: i guess so. >> i like him for saying entrepreneurs isn't a dirty word. he is about the american dream. people would rather have an opportunity than a handout. >> look at entrepreneurship from howard schultz, look at dunkin' donuts model that is franchise. you can own your own dunkin' donuts model. create middle class around the country and coffee is half the price. one of howard schultz's core tenants, starbucks owns every starbucks. they have double the price for their coffee. i granted drink it from time to time. i like it. that is different model. he is saying pro-entrepreneurship type of guy but at same time he is corporate person. charles: jillian likes that. >> i don't think entrepreneurship is dirty word. i agree that. charles: what about billionaire?
is there something inherently something wrong with billionaires? >> they are creating jobs. they are creating opportunities. it is politics much envy. charles: it really is, on steroids. jillian, chris,. >> thank you. charles: talk to you again soon. we're looking at markets right now, the dow off 269 points. it was, it was drifting before larry kudlow's comments about the china trade deal to fbn. that sent the market lower. of course it was already down because of forecast of european growth out of, european commission and bank of england. finally, some scuttlebutt maybe president trump and president xi will not meet after that deadline. does that mean the new tariffs will go into place? aa lot to ponder. we'll be right back. ♪
comcast business built the nation's largest gig-speed network. then went beyond. beyond chasing down network problems. to knowing when and where there's an issue. beyond network complexity. to a zero-touch, one-box world. optimizing performance and budget. beyond having questions. to getting answers.
"activecore, how's my network?" "all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast. in honor of my dad, who was alzheimer's. i decided to make shirts for the walk with custom ink, and they just came out perfect. - [announcer] check out our huge selection of custom apparel for every occasion. you'll even get free shipping. get started today at customink.com.
what is happening across the pond but what does guidance mean for us in america? will banks be more accommodative, central banks around the world? here now back to discuss, phil blancatto and michael block. phil, what we heard was not necessarily news from the bank of england or european commission. that was warning, shots across the bow of the euro centric, euro skeptics or others, you know, this whole movement. i think, for the particularly for the bank of england, it backfired miserably head of original brexit vote. >> you have a lot of things going on very concerning. talk the biggest one for me. mario draghi, will do anything it takes to support europe -- charles: head of ecb, the money printing organization in europe. >> stepping down. they never recapitalized banks. never went through the stress test process we did. they have years of negative interest rates, i.e., japan, britain can't make up its mine.
theresa may, be honest, brussels doesn't agree. they will not give them a easy path. european block, wealthiest continent, with european horsepower breaking down. eventually some of that washing up on our shores and it's a concern. charles: michael? >> the thing with europe this, is not a new story. the deterioration has been going on. now the problem we're seeing germany with manufacturing pmi, made four-year low, it is in contraction. frankly europe has been a dumpster fire. it has been horrible. charles: blame it on trade concerns. >> blame it on whatever you want, the fact of the matter that is just one factor. there is inability to reform. german press a week ago, charles was all aflutter, the german deficit would grow to 23 billion euros. i'm not saying germans start spending irresponsely, it will not happen, but needs to be use
of fiscal policy it is not happening anywhere in europe to satisfactory matter to promote wage growth and everything else. there is real issue here. it is a structural. the whole eu is in question here. charles: hit our shores, phil? what does it hit our shores? what does start to hurt our economy? >> i argue it already has. export market is frankly a basket case. see if they get any upside. a lot is priced into, it is priced into a lot of u.s. stocks. could it get worse? absolutely. we could see germany in recession. we could see italy and france in recession. never mind peripheral countries we could have banking crisis. i'm waiting -- charles: in retrospect, guys, maybe the federal reserve, maybe jay powell wasn't blinking, maybe he wasn't caving to president trump. maybe he was being very astute and maybe to a degree that is good, because it didn't trigger panic. maybe the narrative that hey, president trump made jay powell cave, instead of jay powell sees
the u.s. economy potentially falling off a cliff? >> i think it is unfair. i think powell is spot on. he took advantage. they took advantage of opportunity to raise rates when they had them. there is moderating in u.s. growth. certainly issue overseas. now you have a situation where why continue to put gas on the fire when you may not need to now. charles: do we go into recession? recession not on the table? >> you can't be recessionary when you have the greatest levels of unemployment you've had in decades. got wages increasing. more importantly recession requires catalyst. no catalyst. no bubble in the market. no overleveraged financial situation. that is important. charles: if you look historically, michael at a chart when these low unemployment levels is typically, that is usually on the eve of something. i mean most of it is fed-induced but slow economies on eve of potential recession in the past. >> fine, a lagging indicator. we can say that a month ago everyone was saying it is recession. i remember being on with david
asman 5:00, he said something to the effect, survey, half the ceos thought recession was coming. half didn't. of course we didn't cover from that angle. market was down in the dumps. we have to talk negatively. everyone saying business cycle is over, business cycle is over, run for your lives. i've been hearing that for five years. my read on the business cycle, yes we're very late in business cycle that may never end. there is a lot of convoluted factors. we have the central bank manipulating things. i'm not saying manipulating bad, evil way. there is a lot going on. a lot depends on the market. charles: a lot of these economic purists, are they wrong then? using the playbook that we used in the '70s, even early 80s, i don't know that we have to go back to the playbook, particularly because of inflation. >> two reasons why. bulk of country's wealth people 65 and older. they don't spend the way they used to. second one, amazon effect, technology effect. we still can't calculate what that has done to real production and real costs and earnings.
in that environment you have to think the model we used to have is different. i argue we're in the goldilocks environment, not run away inflation, run away lending but mild -- >> guys agree. stay the course. thank you, phil, michael, thank you very much. >> thank you. charles: the pessimism about the global economy is sending market lower. larry kudlow comments on this network, china that to the the ball rolling to the downside. we're here making money. final hour of trading. we'll live up to our name. see maybe where some opportunities could be. we'll be right back. comcast business built the nation's largest gig-speed network. then went beyond. beyond chasing down network problems. to knowing when and where there's an issue. beyond network complexity. to a zero-touch, one-box world.
do i use a toothpaste that whitens my teeth, or one that's good for my teeth? now i don't have to choose. from crest 3d white, the whitening therapy collection with new spearmint and peppermint oil. it gently whitens, plus it has a fortifying formula to protect your enamel. crest. healthy, beautiful smiles for life.
occurred after a fire happened at one of the bank's data centers. apple releasing an iphone update to fix a facetime flaw allowing people to eavesdrop on group video chats. the repair is part of apple's ios 12 system available today. the feature was turned off days after a 14-year-old boy in arizona discovered the flaw. ford planning to invest $1 billion and add 500 jobs at its plant in chicago, as the automaker launches three new suvs, a new ford explorer, new police interceptor utility and a new lincoln aviator. stocks continue to be under pressure here. we hit new lows right after president trump's top economic adviser told stuart varney there's still a great distance to go between the united states and china on trade talks. keith fitzgerald is back with me. keith, again, this last hour of trading i think will be absolutely phenomenal, because if this was december, november or october, we could lurch into a massive sell-off aided by perhaps programmed trading, algorithms and such.
if we close down less than 300 points, to me it would suggest that investors just don't believe that there won't be a trade deal, that investors just don't believe there will be another shutdown. >> you know, i won't go with the belief part but i will go with the fact that we certainly have stability. i just have a little different take, respectfully. i don't think we've walked away from the bid because traders know they can't afford to. on days like today, the secret is going after companies that have margin protection power and companies that have been undervalued because that's where the institutions are going to rotate on a day like today. charles: so we see utilities up, we see earlier in the session, real estate up and even with individual sectors, you can't just throw a dart. semiconductors, some of the old names are higher but intel was down. so what do you make of that, even within the individual sectors themselves, to your point, there are buyers but overall, there's not a lot of
sellers. why are the sellers so reluctant after such a big move? why aren't they taking profits? >> well, again, this is something you and i talk about all the time. the risk of being out of the market is greater than the risk of absorbing a bad headline. that means they've got to keep their foot on the gas. to me again, they are looking for these companies that they know are not going to go out of business, they are looking for the things that institutional and individual investors know they cannot afford to be without. that's why you are still seeing buying. charles: where do we go from here? are we just sort of marking time? we've got some pretty hard deadlines out there, we have a hard deadline for potential shutdown, we have a hard deadline for the next round of tariffs to be increased, we have a hard deadline on the brexit situation. we've got some pretty hard deadlines. are we just marking time as we march toward those deadlines? >> i think that's a very astute observation, charles. i wish i could tell you which way to go and i will break out my magic eight ball or tea leaves. i don't know, but what i do know
is here's the moment. this is the moment where you want to make your decision about which companies you do own and which companies you don't want to own. i think there's companies like twitter, for example, full disclosure, don't have anything to do with it, that are ripe for a fall. on the other hand, you have hated companies like apple which has widely got problems of its own but that's making a fundamental pivot into medicine that will be used by millions of people. to me it's a very obvious equation even though the calculus changes. charles: essentially what you are telling investors is overlook all of this stuff, whether it's resolved in the next two or three weeks or the next two or three months and look much further down the road right now. >> well, the way i look at it is this. growth may slow but in the history of the world, charles, it has never stopped. the only question is, what does it look like and where do you find it. charles: we find it right now in america. first and foremost. >> yes. yes, we do. american companies are resilient, filled with bright intelligent people.
i would not bet against this country. charles: what's your biggest worry, keith? obviously your main job is to manage risk. what are the top risk issues at least for you? >> well, the top risks to me are front and center by the fed which is at the head of the class. people look at it as a savior but it's the single biggest risk because it created an environment that is literally awash in money. there's a reason why ford can produce all these new vehicles and it's not because consumers can pay cash for them. it's because they can finance them. that's a very different problem set than we had 100 years ago in this country. so the fed is number one. i think a crazy exit in europe and not from england but from italy, spain or portugal is something that's not in the cards and finally, china and russia team up. those are the kind of things that keep me awake at night because they are not being factored into current pricing or even our legislative body. charles: great stuff. we really appreciate it, as usual. very, very good. we learned a lot.
see you again real soon. dow jones industrial average off 282 points. i think we were down like 380, 389 at the worst point of the session. obviously a lot of pressure. you can bet the last hour of trading is going to be another wild one. liz claman, over to you. liz: we are already getting these headlines, some from the president, but it all started with kudlow on "varney & company" saying there was still a sizeable difference, sizeable distance between the u.s. and china on trade. what's sizeable? can you quantify that? charles: a little bit bigger than little. it's just like miles apart. i think they need to stop -- we want them on our show but maybe they need to be cool with the answers. liz: exactly. we are trying to figure out sizeable. we will take your ideas any time. markets are taking a tumble, though, on those comments on the trade war this morning that came out right here on fox business. white house economic adviser larry kudl st