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tv   The Exchange  CNBC  August 17, 2020 1:00pm-2:00pm EDT

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trade? >> i'm going to give you electric vehicles. i'm going to give you nio. i like it and i bought in. >> joey, what do you got >> ollie's bargain, i think it goes to 110 which was the previous high. >> jim, quick, a name? >> cleveland-cliffs rallying with industrial metals >> thanks, everybody, for watching "the exchange" is right now. >> yes, it is. hi, everybody. thank you, scott strategists are scurrying to keep up with its pace. we're looking at projections on whether stocks are becoming unglued from reality plus, up in smoke. why one analyst is warning vaccine stocks could become the next hot stocks. we'll dive into it as robinhood's value explodes, we'll speak to one company who calls it unethical and wants changes now. we do begin with the markets
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dom chu, the markets in particular >> you can see here 3385 is where we're at on the s&p. we're a stone's throw, kind of spitting distance from there 3393 is the intraday record high, so those two levels to watch. the dow underperforming with the nasdaq returning to that leadership position almost a full percent today record levels of home builder sentiment to the upside. a far cry from where we were four months ago with regard to homebuilder sentiment. if you're looking for a marketplace for better days ahead, check out what's happening over the near term with etfs. they both track home construction and stocks. look at the massive surge we've seen from those particular etfs just since the covid lows in
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march. remember, a big deal responsible for a lot of jobs in the economy as well. we'll watch that trade the stock of the day so far is nvidia they are up about 7% today driven in part by analysts in succesquehanna who have put it high, already up again 210% in just the last year nvidia raising that tide for all the semiconductors watching that trade as well. >> that has been an incredible run. dom, thank you very much as markets continue their climb, wall street strategists are working to catch up. the s&p target 3600. does it mean the rally is for real or does it mean the ride is mostly over now? joining me is simian hyman and
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phil at jp morgan investments. phil, explain. >> it's exciting, kelly, but it's really exciting right now not only do we get the resiliency in the efficacy market that we've had in the portfolio, but for the first time since 2017, we're joining that in the u.s. with overrates to europe aoverweights in equit. from early march to early june, it was all driven by fiscal monetary policy. what's really exciting right now is we're being validated with this information with economic data >> if you're overweight, the u.s. overall markets and europe, how can you be overweight in everything >> because interest rates are so
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low, kelly, we're funding that position from fixed income fixed income, especially core fixed income is very tough we'd rather be in credit than really safe fixed income, and it's a new global cycle, kelly if a new global cycle is happening, that's not a u.s. exceptional story. that's europe in emerging markets and watching the dollar weaken the past couple months is rallying that position if you're an investor in the u.s. and you're investing abroad, you want that dollar to weaken it's fascinating >> weakening dollars help multiple markets, obviously helps europe phi we're in a new global market, simian that suggests it could go on for some time. would you share that optimism even after what we've seen in the market this year >> the economic news has been a little bit better than expected
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and earnings season was a lot better than expected typically in the u.s., i don't think you can take it so far across the board, and obviously i'm talking about the evaluation of tech stocks we're at nine times the price of the book due to the s&p 500 value index. we're about as high as we were at the bubble. yes, they make money this time around on the flip side, value is a little junkier, but if you're looking for rotation, i still think that the quality story makes sense. think about this the value index has had about 20% of its names cut its dividend so far this year. the s&p has had about 15% of its dividend cutters if you look at the s&p dividend aristocra aristocrats, one in five have cut their dividends. the quality in the middle of the style box is a place that's had a little bit of a discount and a little bit more robust for what
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will probably be a choppy recovery >> one more thing on that, simeon, what happens if the pandemic is just an acceleration where the companies that are going to be winners in the next five to ten years in the dij ties - digitized economy are just in favor and maybe you wouldn't want to own some of those cheaper names, so to speak >> i'm on the same page. i don't think you want to go deep value right now, and i don't think you need to completely abandon technology where there is a longer term story. as an example, tomorrow we get the e-commerce report following um on retail sales from last week i think we're going to see an even bigger surprise to the percentage of retail that's moved online we know that that's partly a lockdown story, but that's got legs that were starting long before the pandemic and likely
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will continue long after so there's certainly pockets with a long-term story to it, and deep value, i agree, i'm not sure i want to be there because it needs such a v-shaped recovery >> before we go, phil, quickly respond to what simeon said. would you be telling people even though you're overweight, the u.s. in general, avoid big cap names? >> we are still leaning slightly toward growth, kelly, but we'r not adding to that this is all the same trade if the fed is successful at promoting s&p expectations, and rates have trickled higher if they're right about inflating things in the next couple years, that value story will play in a pretty big way we don't want to overrate t-- overweight the value because it should be higher >> thank you both. let's talk about the dollar, the index sliding down to new
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two-year lows continuing to weaken and now hedge funds to short it for the first time in the next couple years. rick santelli is here. rick >> it makes a lot of sense because things change right around june. one of the things that may have changed the most were all those dollar funding issues. let's look at an emerging market etf starting in june you can clearly see it really has done quite well. from 38 to 44, that's about 15% up in that time period and we know that emerging markets have done well, but so has europe, especially considering sharing debt so put in an eu chart, a currency on top of that, and you see they move together but one thing that doesn't move with the euro or the merging markets, and that's the dollar index. let's look at year to date etf with the dollar index and there is your big story. we continue to see the dollar moving down, we see the merging
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markets doing better, and in the final analysis, maybe higher rates on the back side as our last guest was talking about could reverse it, but for the moment seems to be flashing yellow for the dollar and flashing green for the euro and the emerging markets kelly, back to you >> rick, we often talk about when hedge funds pile on a trend one way or another, sometimes it's contrarian. what is their record of making bets in general? does this tell you maybe people are too consensus on its weakening? >> what i would say is they overcompensate on the notion it's a reserve currency. i think piling in isn't a bad idea they might be a bit late, but ultimately, remember, foreign exchange tends to trend for long periods of time. i think they're going to be okay for a while. it's going to be the good news of the future that hurts that position as less stimulus is needed in the long end and the curves steepen, that will be the
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undoing of that hedgey trade >> you wonder just how close we are to that junction rick, thank you, sir rick santelli, we appreciate it. let's switch to nancy pelosi calling lawmakers back to capitol hill this week to vote on a bill that would bar changes to the u.s. post office over fear of mail-in ballots. eamon javers >> reporter: as you say, speaker of the house nancy pelosi is calling congress back from their summer vacation. they're off campaigning and going to the democratic convention this week on saturday, though, they will come back and vote on a bill that would give $25 billion to the u.s. postal service which is really struggling. it's also going to roll back some of the changes that have been put in place by the postmaster general democrats worry those changes are sabotaging the postal service's ability to conduct mail-in voting in the election this fall. the president for his part continues to tweet and spoke to reporters today as he departed
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the white house, venting some of his criticisms of the postal service, saying it's been mismanaged for years and also saying that mail-in voting is a, quote, very dangerous thing. so just how bad is the financial picture at the post office the q3 report is out $17.6 billion in revenue for the postal service, over $19.8 billion in expenses. do the math, that gives you a $2.2 billion net loss for the postal service just in the third quarter. so they are losing a significant amount of money there. and you look at the way the pandemic has really changed the postal service in terms of its operations all of the stuff that you get in the mail is down for the most part, except for shipping and packages so marketing mail down 37.2%, first class mail down 6.4%, but shipping and packages, as we've all shifted to this sort of work from home amazon package dropoff at your house, all of that is up
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53.6%. so some big changes for the postal service during the course of this pandemic, and they do need some money. democrats say that funding is on the way. we'll see if the president is inclined to sign a bill in the senate, kelly. >> there are so many issues with the post office. the question whether they can get ballots to people is a pending question of whether mail-in ballots are a good idea? >> sure. there is one thing which is the practicality of doing it the second thing is should it be done in the first place. the president says mail-in voting is ripe for fraud he says foreign governments could meddle in the election using mail-in ballots. democrats say, no, that's not the case, and because of the pandemic, more americans are going to vote by mail this year. it's expected in any year previous to this it's going to be a test of that system and the integrity of the election themselves. democrats say they worry that the president, through the
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postmaster general, is meddling in the post office's ability to have a fair election they said it could be months or years before we know the result of this election if the bulk is done by mail the president says that's not a good result. the democrats say they can tally pretty quick and they should have an election >> eamon javers, thank you we're going to speak with one analyst who says the vaccine stock could be part of the euphoria we saw in the pot stocks we all know how that ended baba, bullion and big apple bookings all of that ahead, too stay with us you say the customers make their own rules.
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welcome back as a lot of companies receive trials for their covid-19 vaccines. their stocks have been on a tear take a look at novavax, biotech and moderna. my next guest says vaccine stocks could be the next pot
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stocks tell us about the similarity you see here, jared holz >> thank you for having me, i really appreciate it these vaccines seem to be their own separate universe with respect to performance, with respect to different trial managements and the result it just makes me think back to the marijuana stocks of 2017 and 2018 where we saw a very similar setup. these were all sort of penny stocks or the equivalent to that, and then they exploded when the investor base thought this was going to be the next, you know, leg of growth. look at them now, they're all trading much closer to multi-year lows than multi-year highs as the crowded nature of the space and reality has set in i'm not suggesting that the data sets we're going to get here are going to be unequivocally negative, i just feel like we're in the same sort of psychological zone we were in back then. >> yeah, and you've compared the
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market caps whereas cannabis stock started out worth 2 billion, then they circled to 41 billion. there was scott's miracle gro and you take that out and it was even less. vaccine surges started at 32 billion and now they're at 165 billion. i know the government is not seeing this to be a major profit engine >> that's totally right. when we look at the number of players here and what the government has already done in terms of funding, we've gotten almost $10 million worth of funding and that's a combination of development effort but also procurement. so buying the vaccines, buying the injections before we even know what the phase 3 data is. i think just based on the comments out of the large pharma group, johnson & johnson, merck
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and others, it seems like the other companies will be more aggressive on price or at least cognizant of the fact we're dealing with a pandemic, so how much they're willing to charge, i think there will be at least some sort of sentiment around as far as what they're willing to take >> yeah, and moderna as well you could argue, well, they have more at stake. they have more expense and more kind of on the line for this, so that's why there may be less negotiating on price but i think the bigger issue as well from all of us who are curious about when this vaccine will be developed and how quickly -- i don't want to put it quite this way, but do you think none of these, quote, unquote, vaccine names are going to come through and have a vaccine in the end or are you saying even if they do, you got to be careful because of the way they've been trading. >> yeah, the latter point, kelly, for sure. i was with you a couple months ago in terms of, you know, trying to get ahead of what we thought was going to be a very
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accelerated approval timeline prior to the election, and i think you see a lot of politicians, including the president, sort of echo that view over the past couple of weeks. but to your question, even if we get several of these vaccine players that could have good data, it's going to be, you know, several companies, if not more, that are buying for this market share in what i believe is going to be a very, very price sensitive market furthermore, we don't know how long covid-19 is going to last so many of the experts have been wrong with respect to the duration of this virus, anyway so what if coronavirus goes away in 2021 or, you know, better off, sometime this year? what happens to the valuations of these companies if we get through a period of time where the virus is less severe there are so many things to consider here, and i think the number of players, the level of competition is also one of my concerns here. >> i just want to ask you before you go to make sure people are aware, you're approaching this as a health care expert
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strategist so these valuations are in front of you every day. what would you recommend to someone who wants exposure to a vaccine maker, if not someone we already mentioned? >> i think the less risky is to own the large pharma cap companies that have some basis or stability under the vaccine themselves that would be astrazeneca, merck and sanofi if you're not paying for any of those programs, i think in addition i would be recommending the manufacturers, the research organizations that are involved in all of these companies. it's sort of like the levi strauss of the gold rush when you see the levels >> jared, it's good to have you. thank you, sir jared holz of jeffries amazon and facebook may be the most high-profile names that
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investors are buying these days, but believe it or not, they are not the highest bought plus, unethical. that's how one of our guests talks outhabt e change-up robinhood. we're back in two. [ chuckles ] whoo. i'm gonna grow big and strong. yes, you are. i'm gonna get this place all clean. i'll give you a hand. and i'm gonna put lisa on crutches! wait, what? said she's gonna need crutches. she fell pretty hard. you might want to clean that up, girl. excuse us. when owning a small business gets real, progressive helps protect what you built with customizable coverage. -and i'm gonna -- -eh, eh, eh. -donny, no. -oh.
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welcome back to "the exchange." let's get a check on markets the dow is kind of the kid left sitting out of class today he's down 53 points, but everybody else is positive and that's where the major headlines of the session come in the s&p 500 is up a third of 1%, 3385 we're just a point below its all-time closing high, 1886. the nasdaq has already achieved that, but in the last couple minutes it hit a new record intraday high. now a new intraday high in the s&p.
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here's some of the individual movers we're also on apple 2 trillion watch this afternoon apple would need to hit 4457 we're at 458 per stock today overstock is an unploobelievaby volatile name, it's up 22% today. virgin galactic is coming back to earth watch delays are highlighting an uncertainty. it's under 18. finally take a look at bitcoin it's trading back at $12,000 that's the highest level in more than a year, flip side as we've been talking about in the past hour let's get to sue herera for our cnbc update. sue? >> hello, kelly, hello, everybody. some disturbing new numbers on covid and kids
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according to the cdc, the number of children infected with covid-19 is increasing a little over 7% of all reported cases were among children as of august 3rd children make up about 22% of the u.s. population. cook county state's attorney general kim fox is found to have abused discretion in the case of actor jessie smullet they found abuses of discretion and failures a heat wave continues to scorch the southwest united states 130 degrees was recorded in the death valley of california it is said to be the highest temperature ever recorded on the planet death valley also holds the record for the highest temperature ever, 134 degrees
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set back in 1913, but that number is disputed due to the lack of modern technology at that point suffice it to say, kell, it is really, really hot out there >> yeah, and we experienced that the last couple weeks on a more modest way over this part. sue, thank you very much when we think about stocks that investors seem to be piling into this days, we often think of apple, amazon and facebook. but you might be surprised it's not the famed heavyweights that are overbought dom chu is here with more. >> as we talk about the moves that we've seen, kelly, the idea is we have measures of momentum that a lot of traders look towards to see if a stock is something they call overbought or really moved to the upside in a short amount of time or oversold moving to the downside in a short amount of time. so take a look at these two measures of momentum just two, there are many of them out there. moving averages is one of them just take a look at how many or how a stock is performing given
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its relative performance to its average price over, say, the last 10, 20, 50 or 200 days. the other one is a relative strength index or rsi. you'll hear that one referred to quite a bit as well. this one takes a look at how a stock is trading right now given how it's traded against its gains and losses over a short period of time those particular ones in context. we know it's been a juggernaut so far it's worth $1.5 trillion this purplish line represents the 50th average price for the stock, but look where amazon is. that gap right there is about 8% higher than where it's traded on average the last 55 days that's a pretty good trend for amazon take a look at this particular stock, best buy it's getting a hit from the covid trade. that hit has put it roughly 22%
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above its average price for the last 50 days so by some measures, kelly, amazon, yes, very much a positive momentum story, but some other stocks out there have had a lot more positive momentum relative to their average prices it's something a lot of traders look at, but we'll continue to watch some of these names, best buy being one of them. >> it's fascinating, i wouldn't have thought best buy. we know it's a good performer, but still. best buy is the crowned king today. year to date the stock is one of the better performers in the retail landscape 20% gains year to date are not too shabby given everything that's happened. it's up 124% when back in march it was trading at just $48, and it pays a dividend of 2% that's a higher payout right now than apple, microsoft and amazon a steady stream of
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welcome back let's catch you up on a few stories that should be on your radar today. it is time for "rapid fire." here to break down it is headlines are robert frank, dom chu and don fort it's great to have everybody here alibaba is the latest caught up in a sprint transport. the president said he's giving up on alibaba unanimous executive order, giving them 45
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days to find a buyer how important is putting alibaba in the conversation right now? >> i don't get it. the trump administration undermining its own claim not wanting china to have access to u.s. data. that's not the business that alibaba is in. this is not a consumer app everyone has on their phone, this is about a business accessing chinese manufacturer capacity when you throw them in, is it really about protecting u.s. data or is it really about some political fight? >> robert, what do you think >> i think you couple that with tiktok the administration on friday put out an announcement saying this has to be done by november they already said a deal has to be done by september 20, or no u.s. companies could do business with tiktok. what will be interesting after that deal iswhether the chines allowed the u.s. government to look at all the financials, to
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interview employees of tiktok and its parent company, and to look through all the financials and all the technologies so these requirements, to jon's point, go beyond the scope of are you protecting data to really are we sort of encroaching on their rights and their companies with the u.s. government >> i wonder, dom, if it's kind of testing the water somewhat to say is there an appetite among the u.s. public to further splinternet the business relationships between u.s. and chinese companies whether or not accessing data on my phone has anything to do with it >> it's testing the waters and it's also kind of changing the temperature, right it wasn't that long ago you saw president trump, then-candidate trump, standing next to the founder of alibaba talking about the success story john mau was president trump has talked about the last eight months being a lot different. look at the last four years. it wasn't too long ago these two
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were on good terms now it looks like that relationship has thawed out a bit and frozen up again. >> jon, i'm not saying it's a slip of the tongue, but what other buckets could alibaba fall into and more cracking down on huawei, is it possible this isn't about data surveillance, it just goes back to this whole of tit-for-tat >> i think that's the political direction, but watching this from a financial perspective and from a kind of technological perspective, i think it's important to keep eyes on data and principles whatever governments are doing, whatever companies are doing strategically, it's important, i think, to know what are the base considerations about data, about security, and about strategy that are important here, because politicians, they have their own priority >> yes, and we know we'll be hearing a lot of them in the next couple months, but your points are well taken, guys, i appreciate it. let's talk about berkshire
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hathaway's bet on gold and to warn buffett's criticism of the natural metal, this is only $600 million, only about a quarter of the portfolio. the shares are up over 11% today. dom, let's talk about what's really going on. there's no way this was warren buffett himself buying, right? there's no way >> people who are more familiar with warren buffett and berkshire hathaway than i am all say this was not warren buffett putting it into action himself it could be the two guys taking over the warren buffett portfolio. we know he takes part in multi, multi-billion dollar transactions barrick gold, this is interesting only because we've seen the fruits of their labor the stocks have surged because the pandemic has put a tailwind
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to that. it's just interesting that this barrick gold trade has taken every gold miner up with it. >> anything you would add to that, robert >> i would just say let's not confuse the community with the commodities. he's buying a lot of gold and it fits his criteria. it generates a huge amount of income, $400 billion last year it's 11 times earning and it's fairly cheap and pays a good dividend as a company, it fits the buffett standards and let's not confuse it with actual physical gold which he has rightly said it doesn't make sense for berkshire to own >> it's just that these companies have been around forever. does he think now the value -- whatever i'll take it with a grain of salt, it just is a very head-scratching move today next, a group of california state legislators are proposing a statewide wealth tax this is the first of its kind in the u.s.
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the proposed rate 0.4% of net worth over $30 million this comes as the golden state obviously faces a huge debt over the pandemic how much chance do you think this actually has of becoming law in california? >> totally unclear the government has weighed in in new york they had a similar rate tax on gains. the states are in dire financial situations right now, california looking at a $54 billion deficit, new york 13 billion, and the money has got to come from somewhere in both those states it has to come from the wealthy. that's the only taxpayer where you can generate enough income the wealth tax, 4.4% on assets over 30 million. if you're worth 50 million, you pay maybe $200,000 a year extra in california.
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that doesn't sound like a lot, but that's on top of a millionaire's tax that would push the top rate in california to 16.8%, so you're talking about a combined federal and state rate of 54% alone. add the wealth tax on top of that, that could drive more wealthy or even affluent californians out of the state. >> jon fortt, i read an article of texit peopchsit. will there be a wealth flight coming >> you buy stock in zoom, maybe a tier down from there because they can afford to pay whatever tax. the folks who have money but don't want to fork over that 200,000 that he was talking
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about. elon musk is talking about moving headheadquarters. >> i think it's interesting they're so seriously floating this proposal, maybe out of desperation, but it would seem like the worst climate in which to do it let's stay in california and stay with the theme here of what we're talking about. this also pertains to some major companies headquartered there. uber and lyft, uber may come tie halt this week uber eats will be able to carry on because the company is a delivery service, not a ride hailing service. uber ride hailing service may end if the insistence of becoming an employee stands. this was wasn't a long-term business plan. >> no, they were forced into it. uber and lyft operate in these particular jurisdictions right now under this kind of assumption that the drivers are
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independent contractors, you pay them for what they do and nothing more no benefits, anything like that. if you start to change that business model, things become a little bit more dynamic with regard to whether or not the company can be affected by the payroll cost and expenses but whether the drivers want to be part of that ecosystem i'm not sure if it's a longer secular trend, right the transmission of people was why this company existed i don't know if it stays long term >> and jon fortt, i'll go back with you what's the future of uber and lyft if they're not operating in california in the ridesharing business >> i think the future is they press the voters to change the law in this situation so it's no longer an issue. i think the politics here is another case where they're so exciting that people may lose track of the court issue the court issue is supposed to be benefits for these workers. do they have health benefits do they have unemployment and
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sick leave protection? there are other ways to do that other than classifying them as traditional employees. hopefully some more of those get explored >> maybe this forces the issue back to the ballot box, so to speak. and finally, guys, as new york city slowly reopens for business, hotels are reopening after more than five months in lockdown tourism and travelers are still pretty absent because local residents are on staycations and newlyweds are booking a record number of rooms. they're literally calling this tout as a portion of the business >> hotels say a lot of local new yorkers are coming to these hotel rooms. i think a room that's more cramped and overpriced than a manhattan apartment is a manhattan hotel room i'm dubious these guys will do well manhattan was already overhoteled in pre-covid you have 22,000 coming in the
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next 20 months, and they were already in default in january and february i think this whole industry in new york has to come down in price and investors will have to take a lower return, and ultimately there just has to be fewer hotel rooms. even pre-covid, there were way too many and prices and room rates were coming down >> dom >> this is a matter of survival, just like uberand lyft they're going to delivery because it's not their core business, but it could be. with hotels this is just to make sure you have enough money in the door to keep you afloat until things come back to normal i think it's great to think of entrepreneurial ways to stay afloat, because we will get back to normal. >> i'm stuck on eloping newlyweds. really mr. and mrs. smith for this hotel room >> they're going to have to show the marriage contract to be counted that way thank you all today. we appreciate it robert frank, dom chu and jon
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fortt joining us for "rapid fire." ethical? shame on you that's just some of the words robinhood has for its executives you can always watch us live and on the go on our cnbc app. we're back in a couple
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welcome back robinhood announcing today it's landed its third mega investment for the year, pushing its investment over $11 billion. as the valuation is growing, so is the scrutiny. robinhood is not doing enough to protect investors, according to shawn caston a trader died by suicide after seeing a $30,000 negative
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balance in his robinhood account. it's great to have you here, shawn. thank you for being here >> hi, kelly, how are you? >> we are concerned about this tragic event with a suicide. what changes do you think need to be made >> look, we need to confront the fact that robinhood is a business model i fault no one for trying to make money i spent 16 years as an entrepreneur myself as a ceo and thought i would never be in congress hopefully that experience counts for something. they have a business model that is fundamentally based on creating addictions that is being presented to people as a way to generate well we need to be honest about that. we have an obligation in our current job. i have an obligation to protect investors. they're not holding up their end of the bargain >> let's talk about what that would look like, because obviously robinhood isn't the
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only platform where people can trade in the market, and time immemorial, people are getting burned about what it means to make a good investment what changes do you think specifically need to be made o e a platform like robinhood's? >> i learned from my dad if you're sitting at a poker table and you can't tell who the fish is, then you're the fish this is a business that makes money off money flow they advertise free trades, and then they use behavioral techniques that are no different than anything that get my daughters addicted to their video games to get people to go further. they comply with the letter of the law, know your customer, but the fact that roger kearns was able to get a larger account, as he said, how did i as a 20-year-old have the ability to borrow $20 million when i have no income. >> let me ask it this way.
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what is within congress' power to do? if i'm robinhood -- and i would hope they realized from this episode that maybe there should be a better way to display the information so he understands what is really a loss and what is at stake and so forth, but what changes can you make to tactically avoid that kind of misunderstanding without changing the experience others may have on the app? >> look, we created the sec years ago. it was created to protect investors. i think sometimes we lose sight of that when we say our financial regulars have an obligation to democratize acces to capital when we had him on a few months ago, he masaid it was an sec organization and if investors don't understand the disclosures they're given, we are not doing our job as regulators to protect investors. i introduced a bill hr-15 early
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in this congress specifically to do market testing of sec disclosures which would essentially say the same as any business marketing agency does if you ask people what is being disclosed and they can't answer that question accurately, then we have done our job we have passed on thho senate tt up the sec could do that by rule. >> let me ask you this given what you laid out, would you consider banning robinhood >> i think i'm going to punt on that question because when the question is, when the issue is a company has not violated the law but has behaved unethically. to some degree it's on us as regulators to make sure we tighten up the law on the other hand i think the question f pceo, you have to recognize that you have an obligation, if i was the ceo
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of a company, i would be doing a lot more reflection. >> it's good to have you keep us posted the company hasn't yet responded to request for comment about its business model we're going to talk to a couple selling literally cheap old houses on instagram right after this i felt completely helpless. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at find out your online reputation today
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and let the experts help you repair it. woman: they were able to restore my goome6-8555.
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welcome back record low mortgage rates have led to a multiyear high in housing affordability. low inventory have made
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homeownership tough if more cash strapped millennials my next guests launched an instagram account and it's become a tool for people to land their dream home cheaply it's great to have you both here welcome. >> thanks, kelly for having us on and talking b about millennials buying cheap old houses all across the country and saving house at a time >> i can't figure out what to make of this, elizabeth. i follow you on instagram and i think this is amazing. these $23,000 beautiful old houses and someone will come love them and restore them and this is the best thing that ever happened and the other part of me is i can't fin ish my venn table garden this summer are people getting way over their head >> these are houses that allow you to buy something from the
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get-go with closing costs you can aafford and chip at them over time. is it satisfying work? absolutely >> how many houses have you sold and what's the general demand in. >> we've had some crazy stories. we know about 40 people who have purchased these houses off the instagram. we'll post them and the realtor will get calls there were dozens of people looking at the houses. >> hundreds. >> one guy broke his car down coming across the country, got a rental and finally got there it's kiempnd of this wildfire. >> people are ending their lives and moving across the country to buy these. they are making huge life changes. >> realizing you can work from anywhere the timing from the pan dijhas made people realize you can work from anywhere.
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you guys aren't the realtors you're not realtors. you did your masters in historic preservation this is a special cause for you. >> it really depends on the house. don't expect your house to look like an instagram feed month one. get yourself connected with large community of people online that can help you and can support you. it's very supportive community >> you have to be in those facebook groups to stick it out. ethan, your business model is you have the subscription services people can sign up for it. are you able to make a living doing this >> yeah.
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honestly, the biggest passion we have is having these homes get in land and to people's houses i think we, as a couple, this was sort of happenstance i think it's been our greatest joy to support people getting into their homes through these news letters elizabeth has cheap old abroad houses you can do cheap farmhouses and cheap-ish houses >> cheap old farmhouses is my favorite the ones with acreage. >> mine too. thank you both best of luck and help everybody finish these projects too. they are taking on a lot thanks for joining me. >> thank you go buy a cheap old house >> cheap hold houses on instagr instagram. coming up next hour, september is a know fnotoriously slow monh
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we'll look at how the pandemic will make things worse ♪ come on in, we're open. ♪ all we do is hand you the bag. simple. done. we adapt and we change. you know, you just figure it out.
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it's full of everything that you need to know about getting started on your self-directed ira today. you'll be glad you did. good day, every one. welcome to "power lunch. stocks are higher right now with the s&p right below a record level. is there too much market euphoria right now woo we'll explain why we're asking that question. apple is within striking distance of a two trillion tlar market value shares are up 57% this year. we'll tell you why traders are


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