tv Maria Bartiromos Wall Street FOX Business August 31, 2019 5:00am-5:30am EDT
political history" now available for preorder on-line. hope you will buy it and more importantly hope you will read it. thanks for joining us. good night from new york. bartiromo's "wall street" begins now. ♪ >> from the fox studios in new york city, this is maria bartiromo's "wall street." maria: happy weekend, everyone. welcome to the program that analyzes the week that was and helps position you for the week ahead. i'm maria bartiromo. coming up in just a few moments, khan academy founder and ceo is here with me to talk about the challenges of making quality education more accessible right in the middle of back to school season. later on, ben shaw will talk to me about the booming business of animal care. but first, joining me right now to discuss this wild august for the markets, what's ahead for the rest of the year, strategic securities head of policy research, dan clef kin. it's great to have you. >> thanks for having me. maria: i love your work, because
you really look at policy and try to understand what policy tells us about the broader story, economy and investing today. let's talk about one of the more important policies, and that is china. >> yes. maria: we are waiting to see what happens with the two countries. we know that the u.s. has these seven sins that they say china does, and i don't know if the president can do a deal if the chinese do not agree to stop stealing intellectual property, force transfer of technology, what do you see happening? >> i think something happened in the month of april, and i think they started to believe that trump was vulnerable in his re-election. and the china interference in this election is going to be far greater than anything russia did in 206. so what they do is they don't want to see the president get reelected. they think they can wait him out, and that's creating escalating trade tensions. the u.s. has proposed tariffs going into effect on september 1st, now we're seeing the chinese start to retaliate and
create pressure on the economy. maria: so here we are, this is the weekend those tariffs are going to go in mace, 10%, so china comes back. they're going to tariff $75 billion of u.s. goods between 5-10%. here's what we were told, the trade director at the white house. watch. >> i think the risk here for china when it does things hike this -- like this is galvanizes more support for the president. look, we're going to have negotiations. $75 billion worth of tariffs in terms of, what, the combined $30 trillion economy is not something for the stock market to worry about, and we're cool here. maria: and yet the markets do react. so it is a drop in the bucket when you look at the size of the economy, but it is still significant, isn't it? >> yeah. so, first, let me say that we did a wonderful tax cut in 208 and 2019. we're now at a point where the
combined amount of tariffs for the u.s. and china are offsetting almost the entire tax cut for 2019. maria: wow. >> the market's ooh getting worried about the qume cumulatie impact of that, and it's taking the u.s. from a 3% growth rate to a 2% growth rate. markets are starting to worry if there's escalation, it could lead to larger economic problems down the road. it's why the president's really pressing on the federal reserve to act as sort of a cushion during this. but i would not start to say this is no big deal. it's impacting not only that first derivative, but the second derivative, and that's business confidence. and we need business to be confident to make investments. i believe that peter navarro's right, the american public support the president for what he's doing on china. it's bipartisan in nature. but that only works until job losses start happening. and if job losses start happening, you'll begin to lose political support. maria: i understand the national security risks around china. these are real, and the whole huawei situation where there are back doors in huawei telecom
equipment going back to beijing, all your data goes back to beijing. so what if there's no deal between the u.s. and china? >> yeah. and there's a real possibility we're not going to do a deal before the 2020 election. for the market, you're going to be worried about can we deescalate. we don't want to sees calculation. can we do an ag purchase allowing u.s. tech companies to sell to huawei, not the telecommunications which are spying on us, but providing the technology they need for their cell phones. that's something the president talked about possibly doing. maybe markets would feel better. but if there's no deal, the white house has to be focused on what else they can do if there's no china trade deal. do you get nafta passed in september? we're starting to think that there's some building momentum for nafta that's not priced into the market. maria: usmca. >> yeah. and number two, can the president act on tax cuts? he's got two avenues for that. can he do indexing capital gains unilaterally, or does he try and do a deal with democrats on the
payroll tax? maria: you want to see him do the indexing. >> i do. investors don't want to unrealize their gains. if we index that capital gains basis to inflation, you are providing a tax cut that is twice the size of the 1997 or 2003 capital gains tax cut. it will unlock trillions of dollars of capital and get investment and really help with this situation. of course, the media will say, oh, this is a tax cut for the rich, but it's really about unlocking that capital, getting confidence back, making those investments which have been on the sidelines because of trade. maria: so when the congress comes back in the next couple of days, we're basically going to be all in on 2020, and you've got the president's policies which are stimulating economic growth, then you've got the democratic candidates coming out with some other things that sure look like socialism. is this election being set up capitalism versus socialism? >> absolutely. and you see it with bernie sanders' recent green new deal proposal that was just released. i mean, it's $16 trillion, right?
maria: it's going to pay for itself. hello? i'm skeptical. [laughter] >> so, you know, i don't want to be, i don't want to be, you know, they're not going to be able to pass all that, right? but you're really starting to see the president set up a contrast. he's for the economy, they're going to hurt the economy. now, for the democrats, they're moving in a different direction, they're going to try and pip the president about -- pin the president as a racist. you're setting up a campaign of capitalism, socialism versus racism. but at the end of the day, voters vote on the economy, and the president is going to be laser focused on the economy. maria: so looking at the rest of the year, fourth quarter, what kind of fourth quarter should investors expect? what do you want to do as an investor having all of that policy advicesome. >> yeah. i think it really comes down to the leadership of the federal reserve. we know they mathematically have to cut interest rates by 50 basis points. that's what the yield curve is telling you right now. if the fed actually comes in and provides that demand for liquidity in the system, we can
walk through a lot of this political uncertainty that we've been talking about. and then as we go into the late fourth quarter, you're going to start seeing the democratic field begin to win know down, you're going to see is it going to be biden, warren or sanders? those are really going to start impacting markets. maria, i've never seen a presidential election impact certain sectors so early like i've seen. managed care stocks falling 25% just on the prospect of bernie sanders being the nominee. now as we get closer to that iowa caucus, it's going to be a headwind in the fourth quarter which is why the fed reaction is so important. maria: i love the-and-a-half gating. it's great to have you. dan clifton there. don't go anywhere, sal khan of the khan academy will join me. stay with us. ♪ ♪ you wouldn't accept an incomplete job
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♪ ♪ >> pga tour star gary woodland stunned the golf world with his victory at this year's open. recently, maria went one-on-one with him on his amazing win. maria: how do you prepare? is it physical or mental? >> more mental. the physical part i hit a million golf balls, and i've done that my whole life. maria: and you work out. >> correct. you try to take care of your body, but the mental stuff's what you got to prepare for. there's a lot bigger atmosphere, so you've got to control your me motions and stay within yourself -- with your emotions and stay within yourself. maria: tell me about that. how do you get into the mindset to win? >> a lot of it's the preparation. you surround yourself with great people who help you get in a position where you confident in everything you do. i put a lot of work in, trust the people around me, and i was really prepared. there wasn't a shot that i had not practiced prior, so i felt comfortable in the arena, and they
then you've got to have a positive attitude. maria: you are where you're supposed to be. that's it s. and what happens after you win? after the u.s. open, how did your life change? >> it was nice to celebrate, get home and see my friends and family. unfortunately, my wife wasn't there, she was, you know, pregnant with twins at the time, so it was nice to get home and see her and see my son and have some family time. maria: what an incredible gift to win and then your wife gives birth to twins. [laughter] >> it's been a surreal month, but it's been good. the twins were nice. i was fortunate e was home, i wasn't overseas or plague, so it's nice to be home and see the birth of my girls. maria: best wishes, good to talk with you. >> you're awesome. maria: really nice to meet you. welcome back. the importance of skills and tools that come with a world class education have become paramount as the job market has become more global in nature. some people say technology is eliminating jobs. for over a decade sal khan has been a leader in the field as
founder of thecap academy. sal's -- the khan academy. sal's mission has been to make education more accessible. it is now estimated at 100 million students across the world use the khan academy. i spoke with him as the back to school season is back in swing. >> it started as a family project almost 15 years ago when i was tutoring my cousin. word got around, and i found myself working with 10, 15 cousins. i started writing software for them, and that was the first khan academy so they could get practice. and then a friend suggested i make videos to supplement that. the videos, i just happened to put them on youtube, made them public for my family. my family told me they liked me better on youtube than in person -- [laughter] and more importantly, folks who weren't my cousins started to watch. fast forward by 2009, 2010, my
day job, i was an analyst at a hedge fund, but i had trouble focusing because there was many tens of thousands of folks at the time who were using the resource. so i quit my day job, set it up as a not for profit, and in 2010 we got some of our first significant funding from the gates foundation, from google to become a real organization. fast forward to today, khan ahmad key's over 200 full-time employees, still not for profit, and that's actually been one of the keys. when the college world wanted a partner to figure out who could be the official practice for the s.a.t., they wanted to work with someone who was motivated to really help students get ready for college versus trying to make a buck off them. that helped us with the s.a.t., the lsat. there's a lot of efficacy studies show that kids learn 20, 30% faster than expected, and i think that's helped a lot of people. maria: wow. congratulations, it's terrific. and i know you're still
teaching, but can you characterize for us, assess the education system in america. when you look at the global standards, where does america fit in in terms of the rankings? >> well, america's kind of in the middle of the ranking, and it doesn't look so good when you look at some of the folks above us or right below us -- maria: you're talking talking, , number 31 in math, you know, we're way down in science. 31 in the world or 35 in the world, whatever it is, is a pretty poor performance for the united states, isn't it? >> absolutely. but there's really two sides to that. one is it's not acceptable, we want our country to be at the very top. the other thing i do make one qualifier which is when you look at those rankings, some of the countries are like the united states or brazil, and some of the countries are, like, they're not countries or they're city-states. it's shanghai or it's -- so i think to be fair you've got to compare against large, diverse
countries like the united states. i think in the united states there's pockets of excellence, and pockets where it's not working out for kids. 70% of american kids who have to go to community college, they have to take remedial math which is sixth or seventh grade math. which shows for large chunks of our students, especially the ones most marginalized, they're spending many years in the system not getting a lot of out it. maria: so what can be done about that? give us your secrets to success in terms of training, preparing for these important tests like the s.a.t. and how students can be the most successful as here we are on the doorstep of back to school season or some kids are actually already back at school. >> you know, there's a lot of dimensions to it, but the one dimension we feel we can tackle is a lot of students, they might get into an algebra class, but they still have gaps from seventh grade, sixth grade, and a traditional teacher can't do much about that. but that's where tools like khan academy come into the picture. one, we want every student in america and really the world to
know, hey, we're that free tutor that your family could otherwise not afford, and it's at a world class level. bill gates famously uses it with his own children, and it's available for free. we're a nonprofit, it's not a commercial. another thing we're trying to do is work with districts, large school districts like las vegas where dr. jesus j ah, the superintendent there, has been doing exceptional work. what that allows for is students in their district to get that practice for 45 minutes, an hour a week so they can fill in those gaps, and we think that's one of the main reasons why kids fall behind. those gaps accumulate, they hit a wall, they get to a community college or a four-year college, and they have to take remedial math. maria: you're the free tutoring you're operating a nonprofit. explain the metrics there. [laughter] >> good question. so one i think about all the time. as you can imagine with 200 full-time employees, we have a
real budget, and we're primarily philanthropically supported. we do get some support for our s.a.t. work, we get 2-300,000 people around the world donating on the order of $20. our budget is around $50 million a year, but we reach over 100 million folks. a lot of what i do is make the case to philanthropists of all size that this is a really high social return on investment. maria: it's a great point that you make. let me ask you about some of the things that are going on in asian societies versus america. for example, i know that, you know, kids have off the entire summer in the u.s., and in china kids are working through the summer, and they have longer school day, and they have less vacation. is this an issue, and do you think that's one of the reasons that some of those asian countries are ahead of america when it comes to education? >> yeah. i actually think that's one of the simplest fixes.
the very clear non-technology changes we could do is have closer to full-day schooling and closer to full-year schooling. if you look at the difference between the united states and some of the chinese test scores on some of these international ranking, most of it can be accounted for by school days, just for school days you get that difference s. and, obviously, summer vacation, it came out of the 19th century when a lot of kids had to work on a farm. we're now a much more urban society, and there's famously the summer learning loss. kids are not learning and forgetting over that three months. maria: my thanks to sal khan. don't go anywhere, more "wall street" right after this. ben shaw is up next. ♪ we trust usaa more than any other company out there. they give us excellent customer service, every time. our 18 year old was in an accident.
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♪ maria: welcome back. the booming business of animal care. as a pet owner myself, i know that pet owners spare no expense in making sure their four-legged loved ones are in the best of health. americans, in fact, spend north of $70 billion on animal care. ben shaw is the ceo of a company that specializes in providing support for vets in the animal care market. he tells me why it's good investment. >> we provide e the veterinarians a variety of technology-enabled services including the software that veterinarians use to run their practice, right? so this is their medical records, their inventory management. we're providing appointment and prescription management services. specifically, one of our capabilities is helping veterinarians identify who needs what and when and proactively engaging clients to drive them either back online to the veterinarian's pharmacy to purchase and repurchase medications or to come back in the office for services. maria: you know, this is so specific and so automatic that you won't forget to make sure
you're re-upping on your pet's, you know, medicines or whatever. even more so than you're seeing in doctors' office for humans. >> we like to say that we're proving what's possible in health care when humans don't get involved, right? that this is a great concierge level of service that we're coordinating care and making it easy for pet other thans to stay -- owners to stay on top of care. understanding where you are, where you've dropped off and when you need to be seen, communicating. part of our challenge is to make this a frictionless experience for pet owners and veterinarians. maria: and you know that pet owners will spend whatever it takes to get their pets healthy. i recently rescued a puppy. my baby, dusty, is everything to me now. and it doesn't matter what it costs, what i need to do at my vet, whether i need to spend more money on -- i'll do it. she's so wonderful.
>> we need you as a client then. [laughter] we'll work to make sure you're set up on a convenient auto-ship service, how about that? maria: that's terrific. i know that this dog has changed my life, and i rescued her, you know, because i did it through petco foundation. but the rescue business is also really important. people don't realize how important it is to adopt as opposed to shop. >> right. maria: and the first thing i did was i sent her to the vet to make sure she had all her shots and everything was, you know, in step. and these things can be real costly. >> well, they can, but also the veterinarian plays a really important role not only in providing medical care, but to be your partner in a professional resource for figuring out how to be a successful pet owner, what is the right level of care. in those early days of new pet parenthood or being a new pet parent is the veterinarian becomes your with most trusted partner in that process. so the more we can do to help them be successful in helping you through those first few months or year becomes
important. you know, then you have life stage management. as your dog becomes a young adult, adult and eventually senior, keeping up with you and helping to educate on change aing life stages and how does the veterinarian coordinate care , and that process becomes a really wonderful journey and an important partner for you going forward. maria: my thanks to ben shaw. don't go anywhere, more "wall street" right after this. ♪ -guys, i want you to meet someone. this is jamie. you're going to be seeing a lot more of him now. -i'm not calling him "dad." -oh, n-no. -look, [sighs] i get it. some new guy comes in helping your mom bundle and save with progressive, but hey, we're all in this together.
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stop taking jardiance and call your doctor right away if you have symptoms of this bacterial infection,... ...ketoacidosis, or an allergic reaction. do not take jardiance if you are on dialysis or have severe kidney problems. taking jardiance with a sulfonylurea or insulin may cause low blood sugar. lower a1c and lower risk of a fatal heart attack? on it with jardiance. ask your doctor about jardiance. the type 2 diabetes pill that's on it. learn more at jardiance.com doprevagen is the number oneild mempharmacist-recommendeding? memory support brand. you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life. maria: welcome back. happy hay -- labor day, everybody. catch the show every friday night 9 p.m., fox business, and i'll see you on sunday morning for sunday morning futures, 0 a.m. on fox news.
plus, start smart every weekday, tune in on fox business from 6-9 for mornings -- eastern, for mornings with maria. i'll see you next week. thanks for watching. ♪ ♪ gerry: hello and welcome to "wall street journal at large." labor day weekend, of course, traditionally marks the end of summer. you probably didn't need to be reminded of that. but it's fair to say it's been quite a summer this year in financial markets. the dow jones central average hit a new high in late july after the federal reserve cut interest rates for the first time in more than a decade. but since then it's been pretty rough going. stocks have fallen almost 5% from that peak, and interest rates in the market, the market interest rates that we have have dropped dramatically. that's bad news for
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