Transcripts For CNBC Closing Bell 20240622

Getting too expensive. Well, weve got a money manager who thinks theres still room to run. Hell make his case, coming up. And disney still one of the big dow winners this year so far. We will be live at the companys socalled d23 expo to look at how the force behind the Star Wars Franchise could affect that stock. Jane wells, who else but jane wells, is on site for us. Our own princess lea. And its the company the New York Post said provided something close to legal Insider Trading. The ceo of media radar, and you may remember his name, will tell us how his ad tracking software is now helping hedge funds. Im very excited to talk to him. I may have interviewed him back in the day. Would that we had the footage. Its a story, those of you who have been watching the market for a number of years will remember it. Its a great story. First, lets start with Jackie Deangelis at the nymex with these gasoline prices spiking in parse of the midwest despite this slide in crude oil. Weve been talking about this. A 20 slide in crude oil prices. Were looking for that three handle, yet people are outraged because their gas prices are going up. According to aaa, the national average, 2. 65, its up seven in two days alone. We had a bp refinery problem in indiana, and that is whats sending prices in the midwest up. Bill, if you think youre in trouble in new jersey, if you were in chicago, up 21 cents overnight, 3. 22. Michigan, up 38 cents in two days. Ohio, up 36 cents in two days. The issue here is a refinery problem. You certainly cant predict these. When they happen, they happen. And it could take a month or so, the company says, to be able to work through this. There is a Silver Lining at the end of the tunnel, however. If crude continues to go down, well see demand slowly come off as the summer driving season ends. And also, we make that switch from the summer driving blend, which is more expensive, to the winter blend. So were still looking at 2. 50 as the national average, some time during the fall, maybe 2 by the end of the year, but we could experience some pain as we get there. I will also say this. Products and crude oil have been trading together for the last few months. So it could be a chicken and egg problem right now. Some of the reason that we saw a little support for crude today could be because of what we see happening with our gasoline, guys. Jackie, thank you very much. Joining us for more on this refinery outage thats actually in whiting, indiana, and the impact its having on gasoline prices, patrick dahon from gasbuddy. Com. I know ill get a lot of good enough from industry watchers, but it always seems like this happens when gasoline prices are going lower. Suddenly, a refinery has a problem, they have to shut it down and fix it for a month here. Am i being too cynical, patrick . I think so, but i think theres probably 99. 7 of motorists really enjoy your take there. And thats what theyve been feeling as well. Obviously, youre looking at a period where demand is very high. Inventories in the midwest now at their lowest of the year. And out of nowhere, whiting goes down. I think youre seeing, certainly, a response in regards to supply and demand, but just a scare out of nowhere that this would happen. And of course, to make it worse, i dont think a whole lot of media is recovering that marathons refinery in robinson, illinois, had planned refinery maintenance, now it is down. I think thats probably some of the response in price that were seeing accounts for that. Patrick, help me skeptical as well here. You know, were talking about oil prices at their lowest since the financial crisis. Gasoline prices in this country arent down anywhere near as much as they otherwise should be. Those margins that these refiners and a lot of these bigger conglomerates are making off this are huge. And one of the only levers that they have to pull in this backdrop. I mean, explain to us, very carefully, why it actually is that the gas prices still are so much higher relative to the oil price at this moment. Well, you can have all the oil in the world, but if theres nobody able to refine it or if theres some scarcity at the refining level, thats the huge bottleneck here. Its the spigot is closed. You put in oil, well, in this case, theres nothing coming out of bp, well, very little. And i think the market is very scared by the possibility of demand exceeding supply and thats the kind of panic trading that the market is engaged in. Now, the good news is that for chicago c bob, we are starting to see some relief. C bobs spot in chicago is down 20 cents today, but nothing for our bob in chicago. So those in chicago proper, where they use reformulated, probably not much relief. But weve seen these types of maneuvers before, when theres a huge unexpected problem. I think a lot of it is just the psyche of this refinery being the seventh largest in the country going down. And now what youre seeing is folks are backing off their positions. You had a lot of buying interests. Now things are finally cooling down. Before we let you go, so, yes, were seeing this spike in the midwest. Are we going to see a Ripple Effect . Will that translate into higher prices, where they otherwise might have been going lower in other parts of the country as well . Not to any significant degree. I think youll see gulf coast refineries sent material north that will take a few weeks, but i dont expect to see that pull gulf coast prices up to a significant degree at all. Its interesting, real quick, patrick, we have the news today about this u. S. mexico oil swap that would bring more heavy crude into this country to refine. How is that going to, if it does, exacerbate the situation . Well, it may not make it worse. Youre just talking about a play on heavier lower quality crude oils. And right now, i think the interesting part is, with Canadian Crude Oil obviously depressed, just because of whiting, you know, the refining sector looks very strong right now. How many refineries is a part of this whole whiting thing are going to look at modernizing or upgrading even further, even Goldman Sachs upgrading the refining sector or many refineries looking very healthy now. So maybe this is something that well look at in the future, more upgrades coming. We hope thats where the dollars are going to, investment. Thank you so much, patrick, appreciate you explaining this one to us. He really does know what were talking about there. Lets get to our Closing Bell Exchange this friday. Tom lie dan is with us. So is peter costa from empire institutions. And rick santelli. Peter costa, youre the lucky one that gets to explain to us. Make sense of this volatile week. Kind of quiet today, was a little bit yesterday, but very volatile early in the week. Whats going on . It was obviously all about china. And i think we had mentioned that when everyone was worried about greece, and i might have been one of the few guys on the air who had said a bigger issue is china, its not greece, its china. And i think it came through this week. You know, youll see the yuan raised a up a little bit this morning, which you will expect. And markets always going to equilibrium. And i think that part of the equation will slowly be mitigated and i think thats what happened yesterday and today. Tom, war you watching in this market . How much of an impact is china relative to oil and where equities go from here . It absolutely is. And i think what peter is saying is that im 100 right. Weve been looking at flows in the etf marketplace and a lot of smart money has been coming into chinarelated etfs off this recent collection. Most recently, the deutsche trackers, hrsr has seen a lot of money. But the key is, and i think the magic bullet is, theres a company, csop, thats going to partner with msci, to come up th an ashares currency hedge etf. So this type of etf will make money when ashare market goes up. And the u. N. Goes down. I think thats perfect, as we saw bob pisani in the last segment talking about the money going into currenciy hedge etfs, very popular, as currencies really are becoming an asset class for investors. Hey, rick, of the markets you follow, after this kind of week, whats your take away . Whats the message to you right now . Well, i think the takeaway is stick with Foreign Exchange. I find it so fascinating the dollar index got walloped this week, down over a penny, because the euro is up large. But the yen has closed to change against the dollar and the dollar is king at least for the week against the yuan. So there are a lot of cross flows here, and trying to get a handle on this recalibration going on is difficult when you look at the primary sources, just the Foreign Exchange markets, trying to handicap this as it filters through on the price of various goods being traded around the globe is something that will be with us for a while. And i still contend that, you know, as peter was talking about, the markets will get back to normal, theyll digest this, i dont disagree. But we still dont acknowledge that the room is filled with natural gas and weve gotten used to it. So hes saying the markets will get used to the manipulation by the chinese under the head that its normalization and liberalization, but we all know that the timing saek e ining sp of why they did it. And rise to the macro issue, they need to do it. They immediate to continue to put that extra chicken o the table, to keep those in the middle class working and happy in a society that isnt going to have social backlash. And i think these issues with china are going to be around for a while. The Second Market i want to reference is, of course, the long end of the curve, tenyear and 30year yields are up slightly on the week. And the 30year did hold its settlement for 2014. So even though, i acknowledge weakness brings rates down, we might have hit a point where that dynamic, until the september meeting, is sort of glide path about where it is now. And meanwhile, peter, the data wasnt that bad. Industrial production in the u. S. This morning, the ppi was somewhat firm. Is that why the market here, the Interest Rates are holding up a little bit . I think so. You know, i dont think it was unexpected. And you know, but this has been weve been in a period probably for the last five or six months, where weve had, you know, youll have one day of some positive economic news, and come monday, there might be something thats on the negative side. So its that, you know, that backward, back and forth, of whats good, whats bad. You know, the fed is still looking at all of this and they still are not getting i dont think theyre getting a true reading on the economy yet. And i think well probably be in this phase of good news bad news for several more months going forward. So to me, you know, we had talked about when we think the fed is going to raise rates. I think its going to be next year. I dont think theres anything in there. I think they get the good news, which makes them want to do something, and theres bad news right behind it. And then they say, you know what, lets back away from that idea a little bit and see what goes down next month. By the way, very quickly, tom, before we go, we got word late today that mostly outflows out of equity funds in this country, and most of that was out of actively managed funds, while money was going into piffly managed index funds. So what do you make of what the average u. S. Investor is doing with the stock market right now . Yeah, bill, youre playing my tune. I tell you, its more of the same, its transparency, its low cost, its tax efficiency. And its not paying a manager whos not performing. And unfortunately, there are a lot of big Mutual Fund Companies who have made billions of dollars on wall street, that now the gig is up. Money is shifting over to index investing, because investors have more trust in their type of management. Now, again, active management, in a few cases, there are some good managers out there. And we want to make sure we recommend that. But, for the most part, if youre not performing along with your benchmarks, you cant command the high fees that some of them are getting today. Well ask john calamos next hour, got him joining the program, hedge fund manager. Thanks, guys. Have a good weekend. About 45 minutes to go into the close. The dow is up about 66 points. Keeping an eye on some breakeven levels for the week, were safely above that for the dow. Anyway, gains up about a third of a percent. The s p up 7 and the nasdaq, 14. Up next, the ishares is nasdaq biotech etf falling for the third week in the last four, but weve got a biotech bull who says that there are still some good opportunities to buy in biotech right now. Well talk about that, coming up. Also ahead, were taking you to disneys biggest fan event ever, where star wars followers eagerly release the force awakens in december. Jane wells will be getting the latest on disneys hottest new property, thats coming up. At ally bank no branches equals great rates. Its a fact. Kind of like shopping hungry equals overshopping. So youre a Small Business expert from at t . Yeah, give me a problem and ive got the solution. Well, we have 30 years of customer records. Our cloud can keep them safe and accessible anywhere. My drivers dont have time to fill out forms. Tablets. 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Find new ways to save energy and money with pg es Business Energy checkup. Welcome back. The major averages are trading higher, but Micron Technology is lower after a Conference Call with analysts where the chipmaker forecast higher Capital Expenditures for 2016, higher than analysts had been expecting. Microns outlook topping out at 5. 8 billion. That stock today, as you can see, down 3. 75 . Turning to biotech now, its been red hot this year, up almost 20 . This is after last year, we had those concerns about a bubble. Anyway, eli lillys ceo was on squawk box earlier this morning, giving his valuation on the space. Were hot on the trail of pursuing a biotech acquisition, and i think a lot of these properties are too expensive for my taste. So, is biotech too expensive right now . Lets bring in our own meg terrell, who follows that industry, and Jason Kolbert from maxen group who disagrees with eli lillys ceo. You i guess its all relative terms, but a ceo, he wants to buy at a good price that he can make money down the road. What about for an investor wanting to buy stocks right now, jason . Its a great question. Listen, i had the same thinking when i looked at alexion in 2007. I saw a 4 billion market cap and meager sales and thought it was overvalued. But if you look at the market cap of alexion today, its 42 billion. So you can make the assessment that you want to be involved in some of the core t companies and the cancer amino therapy companies, and they look expensive, but when you compare the size of the market, you have to understand theyre cheap. I think gilead learned this lesson when they made the acquisition of pharmasat for 11 billion, it looked very expensive, but it looks like theyll completely pay that off in the first year. I think its all relative to your position. Thats an interesting point, meg, and i guess thats what some of these companies would say in their defense, or maybe they are sounding like eli lilly and scratching their heads at all of these valuations. Weve heard ceos say that for a couple of years now. Of course, they would like biotechs to be cheaper so they can buy them at lower prices. But biotech have outperformed the market for several years, and people would like that to continue. But there are a couple things that are making people a little bit worried. Of course its scary to bet against biotech when you have a run like we had for the last five years, but people say if fed Interest Rates start to go up later this year, if they raise the cost of capital, that could start to weigh on biotech valuations. Thats something people are watching very closely. Credit suisse came out with a very interesting note, and weve mapped the fed funds target rate back to 2005. Credit suisse says they are inversely proportionate, and you can kind of see that. The biotech started to come up as Interest Rates came down. Folks are a little worry if Interest Rates start to come up, they could weigh on biotech. Theres another thing here, theres just not so many catalysts in terms of medical meetings over the summer, so things could be slowing down a little bit there. As we look towards 2016, going into the president ial election, there could be increasing focuses, as there already have been, on those high prices of drugs. This could be something that weighs on the sector as well. Jason, we had the head of glx Goldman Sachs here yesterday, if the company feels like the company theyre buying can help transform a technology, within a industry, you know, day do it for reasons other than just price right now. Theyre looking strategically at what it can do. What about in biotech. Is that what youre seeing as well . Thats exactly what were seeing. We see Companies Like celgene making fantastic optional agreements, recently with the cell therapy company, mesoblast that gives them the option of first refusal. And we continue to see those deals. Just yesterday, we saw a deal with anovio and astrazeneca taking the options towards their cancer amino therapy programs. So what i see is data. I see the ability to treat disease at the Cellular Level and weve never seen anything like that before. And i think the lesson from the core t therapies is that were sometimes seeing these companies producing result with an n of one, just one patient demonstrating proof on concept and proof of principle. And thats the blue bird story when we look at sickle cell anemia. So i think youve got to look at, does the drug work, how much data do i have, and whats the potential market . And i think that Biotech Companies see that. I think a more Traditional Company like lily is having a little bit of nausea when they look at the price, but theyve got to look at reward, too. Meg, finally, it sounds like in a way, it took a while for the Bigger Companies with limited pipelines to finally hold their nose and start buying a lot of these biotech names. Are we at the end of that wave or is there still a lot left to cover if this is going to be the story that continues to drive the space for the next couple of years . Its hard to say, i mean, its been going on for a while now and the frenzy seems to continue. People are saying that amgen may be a target. Its scary to say were at the end of an m a wave. Big Companies Look at these and see great pipelines and data coming out and they want to buy them. Sometimes you say if something looks expensive, like, you were saying that gileads purchase of pharmasat looks expensive, but if it pays off, its not expensive. Great point. Thank you both for joining us. 40 minutes to go until the close here. The dow is moving higher. Its up 82 points right now, about 160 points above the breakeven level for the week and what a week its been. The intraday moves huge, as weve finished, the action has been more muted. When we come back, history is made and businesses are lining up. Well go live to cuba. Yes, were going to live to cuba where the American Flag is now flying there for the First Time Since 1961. Later, wall street veteran john calamos gives us his take on what the feds going to do in september now that Chinas Central Bank has thrown a Monkey Wrench into the mix. Dont miss it. Welcome back. Markets here actually at the highs of the session with the dow up about 80 points. Thats nearly half of 1 percent. Different story for el pollo lo loco. Revenue coming in below restaurants. Shares of the mexicanstyle chicken chain now leaving more than half of their value. I love el pollo loco. Ever had it . I havent. Oh, man, is it good. Not an endorsement, just like the chicken. The American Flag, believe it or not, waving over havana, cuba, today, for the First Time Since 1961. Our chief international correspondent, Michelle Carusocabrera is there live. Of course she is. What an exciting day, michelle. It certainly has been momentous and historic, bill, for sure. And john kerry is about halfway through his about tenhour visit here to the island. As you mentioned, the first secretary of state to come to this country since 1945. He started out the day with a speech to an audience of a few hundred folks, where he said cuba and the United States are not enemies or rivals, they are neighbors. Of course, he didnt call them friends, because theres still a tremendous amount of tension between the two countries. This is not a democracy, not since 1959 when fidel castro took over and it is still raul castro who took over here. But john kerry made it very clear that they want to look forward. That he welcomed u. S. Businesses trying to do business here. He tried to push economic integration beyond political integration, even though the u. S. Embargo is still in place and endorsed president obamas desire for the embargo to end. The entire highlight of the morning was the day when the three marines who lowered the flag back in 1961 reraised the flag again today. They said, they always thought they would come back to do, just didnt realize it would take this long. Theres still a long road ahead for true normalization in the two duns. We are a marketdriven economy in the United States and cuba is still very much a governmentdriven economy. They control nearly every aspect of it. By the way, the building that you see behind me is the u. S. Embassy. It was purpose built back in 1953 as the u. S. Embassy in havana. It was considered architecturally significant when it went up. It was only in use for a few years, of course, and then we ended diplomatic relations with cuba in 1961. The swiss government, they were caretakers of the building until 1977, then it became a u. S. Intrasection, housed american employees, a limited number that could work on visas, et cetera, and now, officially, once again becomes an embassy. They put up the fresh sign at 4 00 a. M. This morning. Guys, back to you. Very burning question that everybody is wondering. So how many cigars can you bring out of cuba now . Reporter you can bring back a total of 100 worth of rum and or cigars. Bill, you know how much a cuban cigar costs. A good cuban cigar one or two, maybe four, depending on the size. I think you can get four, as a matter of fact,. Four cigars for a hundred bucks . Yes, maam. Geez. Theyre cuban cigars. Thank you, michelle. Thank you. Michelle carusocabrera in havana. People are also asking, when are we going to start to see flights to cuba, all sorts of questions, its going to be a rush and frenzy of quiactivity. Now, cnbc update. Heres whats happening at this hour. Jeb bush touring the iowa state fair, campaigning for votes. He flipped burgers alongside iowas governor, while at the same time punching on fair favorite, pork on a stick. He also voted for himself by dropping a corn kernel in the bush jar at an impromptu voting station. General electric is expected to secure trust approval for al stoms power unit. The Company Offering more concessions this to head off the eus concern. And a pilot wuas pulled fro his plane by rescue crews this morning after crashing in allentown, pennsylvania. He was reportedly conscious and alert. The cause of the crash, though, still under investigation. And jenna bush, the daughter of former president george w. Bush, announcing the birth of her second daughter via social media. Poppy louise hager was born yesterday. She was named after they are great grandfather. President george h. W. Bushs nickname as a child apparently was poppy. I did not know that. Thats a cnbc news update at this hour. For now, back to you. And that is not a nickname that his grandchild gave him, that was the nickname he had had since he was a child. Kind of the thing you expect out of a much older person. 30 minutes later. The last half hour of the trading day for the week and the dow is up 81 points. Were going to right now we would have a gain of about 150 points on the industrial average. What a week it has been up next, well talk to a top trader about what hes watching in the final half hour of trade. And ahead, twisted technology, tracking software used for advertising is now being utilized to predict corporate earnings before they are officially released. The tactic is raising eyebrows, some red flags. Well talk to the man behind it, coming up. This is cnbc, first in business worldwide. Stickers. Whats up with these things, victor . We decided to give ourselves stickers for each feature we release. We read about 10,000 suggestions a week to create features that as traders wed want to use, like social signals, a tool that uses social media to help with research. 10,000 suggestions. Who reads all those . He does. For all the confidence you need. Td ameritrade. You got this. Dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is, can your business deliver . We are into the last half hour of trading, that critical time in the trading day, and for the week as well, where we start to close things out. Weve got sarge with us today, steven gillfol. Wra do you make of the volatility this week . If we finished right now, the dow would be about 120 weeks. It wasnt a crazy week. It was ant crazy . Hindsight, no. The guys who went long iron condors, they did fine this week, because the market really wasnt that volatile in the end. In the interim, sure, china ran us around a little bit, but here we are five days later and its been calm for two days. Earnings. We cant forget there are still earnings and more to come next week. Sure, going into the weekend, it doesnt look like monday might be too crazy. Got to play it a little bit ahead. Im looking at home depot the and laos. They both report next week. Both ramping up really nice into this earnings release. And myself, i took a shot at home depot. Long the equity and long the calls. Oil, doing anything with that, either with Brent Futures or the stocks themselves . I made money on the stocks this week. Im hanging on to one, hanging on to british petroleum. It pays more than a 6 dividend and i like their management. Ill take a shot there, but thats it. We hear the place to go right now are the dividend pairs. Thats a pretty defensive play, though, right now, right . A lot of people are sensing that this market is kind of topping out a little bit, huh . Theres a chance. And when you make your money in a chancy environment, you have to be partially defensive. Theres no way around it. All right, sarge, thanks, have a good weekend. Thank you. Kelly . Thank you, bill. If you want to know if panera, michael kors, or chipotle will miss next quarter, tracking their advertising might help. Its now being done, it tracks brands and sells that information to hedge funds. This new ad tracking software is like legal Insider Trading. Thats raising some eyebrows across wall street. Now joining us is todd krizelman. Are you enabling Insider Trading . Absolutely not. But i do think the things were showing do allow you to really see how a company is performing. Right. What youre doing, as novel as i understand it, is being able to track more than 3 millionrands as what you initially began as a realtime advertising tracking platform that a friend of yours who worked at a hedge fund said, hey, wed love to have access to this company, we could find out if companies have to do more advertising to meet their numbers. Media radar was worked to help media companies. But just as you said, we had some people who approached us who said, you know what, you can start using that information to predict if a company, are they going to meet their numbers . And if they start spending a lot at the end of a quarter, theyre either trying to have a huge quarter or maybe theyre about to miss it. And youve used examples in the past, panera bread was an example. You saw a big buildup in their advertising near the end of the quarter and then they missed. And on the day they announced earnings, the stock was down 1. 7 . So theres an example of what youre talking about. Youre able to but theres no guarantee that the company is going to miss their earnings estimates, but this is a pretty good indicator that they might, right . Well, its more than that. We find, actually, we can go back and we can say, all right, if we look at 12 quarters and they create the same behavioral pattern, paneras probably watching this and saying, were going to stop that but wouldnt all companies do that. Wait a minute, now everybodys watching it becomes a selffulfilling prophesy, right . Not always. In the case of panera, were talking about it, but with most companies and hedge funds we work, its very quiet. Its basically private information were selling and sharing with someone so they can trade on it. But really the reason you started the company was to help companies determine the best way to approach advertising, right . Thats exactly right. Because its become so complicated. Its not as simple as buying ads on television or in newspapers. Social media, the internet, its all very, very complicated. Thats right. This morning, they were talking about the ceo of nissan and talking about the massive complexity of deploying marketing capital and how it has to be done different in every country across Something Like ten different media formats. So media radar tracks all of those formats. Whether its online video to mobile, and then those are tells. Its like a game of poker. Were able to really see whats happening. Let me pick up on something that you just said, you said its private information were sharing and selling. You may recall there was a big brouhaha over the last several years about expert networks, which allow people to get access from recently departed employees or current ones about private information about companies and trade accordingly. Does this come down to whether youre give an advantage to people by giving them private information as opposed to public information. Were aggregating already public information, so theres never a time where were talking to someone to have that kind of information. Its just that were aggregating so much of it, were able to see that insight. Big data. By the way, before you go, anybody who has been watching the data long enough, you will recognize the name todd krizelman, and i was covering the dotcom boom of the 90s. I thought i interviewed you maybe the day your company ipod. This is a 1998 interview you did with cnbc back at the time when the globe. Com was coming public, boy, what an experience that must have been. Absolutely, absolutely. You guys were poster children for the dotcom boom of the time. Weve kept the company private, a lot of success pb. At least for the time being. The globe. Com, remember the day you went public, correct me if im wrong, you went from 9 to 97 that day . Worst mispricing ever. You left a lot of money on the table. Thats right. I cant believe you dont look a day older than you did in that video. Do you want to share any antiaging tips while youre here as well. The team upstairs who did the facial stuff, its amazing. You dont have to mel me. Good to see you. Todd krizelman, ceo of media radar. Thats him on the right and on the left. We have a news alert right now on the greek bailout. Courtney reagan back with details on that. It feels like its neverending, but we do have some new news on whats going on with the greek bailout. Theres a new agreement saying that greece will be lent up to 96 billion over the course of three years for the bailout. We did see our stocks here in the u. S. Gain on this news. Again, 96 billion in loans for dprooes over the next three years and this follows three hours of talks in brussels. It is a story that just doesnt go away. We are 19 minutes to the close here with the dow coming off a high just a little bit, up 71 points right now. The s p is up 8 and the nasdaq up 16. Were still four months away from the open, but the next star wars film, the force awakens, is already the talk of the disney expo. Its all this weekend and jane wells reports the latest news on the galaxy far, far away, next. Right now the Anaheim Convention center is filled with marvels avengers, popular pixar cartoon characters and of course mickey mouse. Theyre all there for the disney expo, but the buzz is what the latest in the star wars universe is these days. Our jane wells joins us from the gathering and i lost a bet. I was certain you were going to be dressed as princess leia. No, im governor tarkin. I smell your foul stench. Folks, if you know what im talking about, you are laughing right now. First, the buzz is about buzz lightyear. We broke news when John Lassiter revealed that toy story 4 will involve a love story between woody and bo peep. But the bigger buzz this week is this. Were home. Reporter star wars, to infinity and beyond, to mix my mouse house metaphors. A lot riding on this movie and were hoping to hear more about it and maybe well get some word about a star wars land based on the new trilogy of films inside disney, maybe a marvel land. Just a short time ago, george lucas was honored here and he revealed a longkept secret about the leastliked character in his universe. Not very many people realize that goofy was the inspiration for jar jar binks. I know youll look at him differently now, because its pretty obvious, actually. Reporter surprises included johnny depp, i guess jack sparrspar roe will be back, along with new movies, and fans representing all the different franchises. We also hope to get some word this weekend about shanghai disney, given the chinese economy, whats happening over there. But bob iger has said, he remains bullish on china. Thats amazing. There will be a pirates of the caribbean 23. Thats unbelievable. Thats good. Thank you, jane. See you later. Jane wells. I was kidding. Doing it like only jane wells can. 15 minutes to go into a close. For a second i thought johnny depp was going to be in star wars, so im still all confused. The dow is up 73, the s p is up 8, and the nasdaq 16. Its time for david, hell share his thoughts when we come back after this. Its a fact. Kind of like shopping hungry equals overshopping. Start this school year off right with a little extra credit from at t. Right now, switch to at t and get 300 credit when you trade in a smartphone and buy any smartphone for 0 down. With 300 credit per line, getting ahead this school year is easier with at t. Whehe trusts onlyon duracell quantum because it lasts longer in 99 of devices. At ally bank no branches equalsits a fact. Kind of like mute buttons equal danger. That sound good . Not being on this phone call sounds good. Its not muted. Was that you jason . It was geoffrey it was jason. It couldve been brenda. All right, this is our favorite indicator times ten, or five, i guess, was this is the weekly david darts is with us. Watch this, david. These are the ten sectors of the s p 500en dex and how they perform this week. And look at that. Unbelievable. Energy is number one. Energy is the best performing sector this week. If they can zoom in a little bit, because i cant read the green on the white is difficult to read there. Up 3. 2 for the week, believe it or not. So consumer staples, the worst performance, health care is down there, but energy and the utilities, best performers. What do you make of that . Well, im amazed. If you had told me a week ago that china was going to devalue by two or three times, you know, let the currency sink my about 5 at the worst of it all, i think china did it for a part of these three reasons. One is to let Market Forces determine the value of the currency. Thats a good thing. Secondly, their currency has secretly been linked to the dollar. The dollarss up 32 against brazil this year, for example. That means chinas up 32 against brazil. So theyre trying to maybe, its not so much to devalue, but to stop appreciating with the dollar. Thats aed goo thing. Fair enough the third one im sorry, go ahead. The third one, which is the more pernicious one, pernicious from the latin words, for extra deadly, the pernicious one would be that theyre starting a currency war and youll get others following that. So the market has behaved beautifully this week, given that. I do note that western canadian oil is 23 a barrel. And if you had told me oil was going to touch 41 this week, and the market do this, that is an indication of buying power coming in. Well, weve seen evidence that even as oil continued lower, hit a 6 1 2year high low today, people are starting to nibble on the Energy Stocks themselves. And i think thats what were seeing here, dont you . Oh, yeah. And the question for a lot of people doing this, what happens if china stays this week . Theres a lot baked in already with a strengthening u. S. Economy. What happens if were still trying to work through a sluggish Global Economy . Well, youve got europes First Quarter gdp number, Second Quarter gdp number was announced, lower than the First Quarter. Japans is estimated to be minus 1. 5 . Their Second Quarter hasnt been released yet. You have this gdp now, which weve talked about, the atlanta fed number, but the u. S. For the third quarter, right now, bill and kelly, is 1 . Wall streets at 2. 5 . If those things are true, then that reason number one to have a bear market, which is a recession, is looming on the horizon. That, having been said, the fed will delay. And people so youve got monetary stimulus now in china, japan, europe, and the u. S. If the fed delays long enough, though, the train is already leaving station. If theyre looking for a time when they can raise rates as the growth curve is going higher, its going the other direction right now. And they want to build up i believe they will raise this year, maybe september, in order to be able to cut, if the economy does not do what Morgan Stanley thinks its going to do, which is to rise in the second half. Youve got the jobs numbers, youve got the housing numbers. Well learn more about the housing this coming week. Nahb, the Home Builders sentiment index, youve got the existing home sales. So youll learn more about that. And the philly fed and the empire state are this coming week. So well get a look at the underlying part of the economy. This past four or five weeks have been all about profits. And the fact that the you strip out energy, and the profits are up 7 to 8 for the Second Quarter, is not a bad showing. But, this is an amazing, amazing accounting of itself. This is like the in school, youve got a 27 on your physics test and it turned out to be the highest grade in the room. As long as youre grading on the curve, professor, im doing fine. Im doing just fine. Correct. Thank you, david. Nice to see you. Always great to see you. Thank you so much. We are coming back with the close and countdown. Well review how we did for the week with bob pisani. After the break, its attack of the drones. Some elected officials arent standing for it. Well talk to a california representative about how hes fighting back. Youre watching cnbc, first in business worldwide. [ radio chatter ] [ male announcer ] andrew. Rita. Sandy. Meet chris jackie joe. Minor damage, or major disaster, when you need us most, were there. State farm. Were a force of nature, too. Were a force of nature, too. No students ever been the king of the campus on day one. 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My drivers dont have time to fill out forms. Tablets. Keep them all digital. Were looking to double our deliveries. Our fleet apps will find the fastest route. Oh, and your boysenberyy apple scones smell about done. Ahh, youre good. I like to bake. With at t get up to 400 dollars in total savings on tools to manage your business. All right. Coming up on the twominute mark here to close out what has been a volatile week. This is a weekly chart itemizing the dow, the s p, and the nasdaq, tracking each other for the week, though, the s p is the winner, a gain of twothirds of a percent right now. The nasdaq virtually unchanged for the week. Other volatile markets this week, the treasuries and crude oil, especially. So the treasuries, the yield on the tenyear note finishing the week, where was it, at 218, thereabouts, and for crude oil, down 4 , bob pisani, for a crazy wea week. And i think the important thing is we have Energy Stocks up this week, but crude Oil Essentially sitting at new lows. Its what we talked about earlier in the week, there were people who were sensing value in those Energy Stocks. We had that one fellow on who said you look to the pipeline managers, the Master Limited partnerships. Thats an area that you want to look at, because if nothing else, they pay a much higher dividend. Somebody once said, a second marriage is the triumph of hope over experience. Buying Energy Stocks is the triumph of hope over experience at this point. Sorry to be metaphorical. Wow. I wondered where you were going with that. Yeah, three times since december weve tried to buy Energy Stocks and three times its failed. Now this is the fourth time. The problem i have with this approach is, its not Energy Stocks lead oil, its oil always leads Energy Stocks. And we know this. Right. It makes sense. And they have tried to play around that game. And thats why nobodys very happy, because we have a move up and were not oil is not showing any signs of coming back and supporting it. Thats why everybodys miserable. Thats why everybody doesnt believe in the rally. Its nice to see them at least come off of the bottom. You wanted to take a look at xle. Theres a good example of your energy group. This is the main etf for the Energy Sector. And we saw it move up throughout the week. We havent had any kind of rally in Energy Stocks since april in the xle, and there you are for the week. Thats what everybody was buying into. And yesterday it all got bashed here, and today its relatively stable. But this is the kind of pattern that we had, and this was repeated dramatically in december and the end of january and again in april, and it all fell apart on everybody. Next, the fmoc minutes, the economic data, retail sales, Industrial Production, half of the people ive talked to still think the fed can raise in september. I know nobody wants it, but thats what theyre talking about. Thank you, bob. So were closing out the week on a positive note. Very volatile week. Well try to help you make sense of it and look ahead to what could be another critical week for the markets and the economy, coming up on the second hour of the closing bell with kelly evans. Have a good weekend. Thank you, bill. Welcome to the closing bell. Im kelly evans. Before the jazz concert begins on the floor, lets get a recap. The dow going out with a gain of 71 points. Thats about a 150point gain for the week, believe it or not. And as we saw last hour, let me mention the s p is up 8 points. Among s p sectors, the strongest one this week, up 3 , is energy. Well get more on that in just a second. The nasdaq, for its part, a little bit weaker today, and closer, actually. Its only up about 5 points on the week, if we look at it up 14 points here on the session today. Joining todays panel, we have cnbc contributor evan newmark back in the house along with Kayla Tausche and guy adami from San Francisco. Welcome to everybody, here. Evan, since its been a while, what do you make of this market . Weve had china dropping its currency peg. What does that do, if anything, to change your outlook . Not much. Im still 40 in cash. I havent done really anything over the last few weeks, as guy, you, and i talked about. Ive been buying some energy names. Not in big dipping a little bit. We talked about it. Although i have to, you know, last time i was on with guy or maybe a couple of months ago, i felt like i could do a little victory lap. Not anymore. You know, the tenyear has come in quite a bit. Yields are dropping, and maybe the world is turning japanese. Before we let guy respond, kayla, what jumps out to you about this week . Putting it all in context and looking at what we know. I think that the disparity between what oil has done, being at a multiyear low, as opposed to the Energy Sector, as bob and bill were just talking about before the close, i think its really stunning to see that traders are actually willing to be buying energy names, even as youre seeing more crude or more rigs coming online, youre seeing the weakness out of china. All of the signs seem to point to a longer weak period for oil. Just so Everybody Knows this is terrific we know that. Now everybody does. She was doing it like michael aranellla and representatives of his orchestra just rang the closing bell here and are going to regale people. What do you think about these Super Low Energy rates . I think the reason why people are playing around in energy is because the s p continues to show resilience. We talked about it. It bounced off that 2054 level that we flagged. People figure, wheres their value . At some point, commodities will bottom out. Im not sure thats the case. They lackook at names like exxonmobil and conoco and how much lower can they go . Probably a little bit lower. We talked about the reversal and refiners. To go back to everyones comments about rates, i think you know pretty much where i stand in terms of why rates are going lower. I know a lot of people want to try to fade this move higher and lower in yields, but i think its a fools errand. I think were still seeing continued slowdowns in economies across the world, which should lead to bond yields globally continuing to go down. And do you think, guy, that means that the activity, this snapback in energy this week is just short covering, or does it reflect the massive capital coming into the space . The snapback in Energy Stocks is what youre i mean, the commodity did not snap back at all. Crude is not trading there is zero bounce in the commodity. And i know people want to try to play the equities, for obvious reasons. A lot of these names are dirt cheap, but only dirt cheap in comparison to where theyve been historically. Look at the move weve seen in the underlying commodity and look at the problems a lot of these names face. I still think theres pain in the sector. Yes, they can bounce. We saw it this week. But i think the trajectory for the stocks is still to go down. If we look at rates, guy, and im in the middle of the trumpet right now. The trumpet player is really over me right now. But, guy, when can we actually see some Global Growth out of the global economies, other than the u. S. . Is that just nevermore . Are we kind of, oh, weve got to wait a quarter kind of thinking right now . I say it all the time, evan, and ill say it to you, im not smart enough or humorless enough to be an economist. Thats just not my gig. But if you see some of the data, look at the data that came out of georgia. We are seeing slowdowns, and to me, across the world. I think the data in the u. S. , at best, is mixed. I know a lot of people wanted to make a big deal, having Industrial Production numbers that came out, but everything can be explained, depending on what your dogma is. I radio i to take dogma out of the equation and just look at it. And i look at it through the prism of global commodities. And there is something going on that is far more reaching than just a supply issue. I think demand has something to do with it, and i think at a certain point, you have to acknowledge that maybe things are slowing down. Will growth come back . Absolutely. But right now, i still think were going the wrong way. Kayla . Well, guy, we did see a lot of really positive u. S. Data today. We also got some surprisingly good growth data out of europe. But im wondering how much you see that being affected by the weakness in china, exports becoming more expensive, at a time when, yes, we got a greek bailout deal. Everything seems to be moving in the right direction in europe, but then theres a big unknown, which is, how much will their exports actually be affected . Yeah, and you know, these its funny, ive got trumpets in my ear. Its like im at macarena night. Whats going on over there . I think to answer your question, i think were seeing relief rallies this a lot of these things. Greece for now has been taken off the table. I think people are taking a collective sigh of relief. But i think that sigh of relief is premature, at best. I think the fact that were in august has a lot to do with it. I think people are taking their eye off the ball. And we come back in earnest in the fall, and i think people will reestablish their views, and maybe things are not as rosy as the stock markets have suggested. Thats just my view. And thats what makes markets. I try to take dogma out of it, but i just look at it through the prism of, maybe things arent as good as the markets make them appear to be. Things are settling down on the floor here. Lets kick it out to bob pisani for a recap of this wild week. Bob . I think thats a very good point. People ive seen nice moves off the bottom, but theyre not very happy, because they dont believe its a real bottom, because they been burned too many times. Energy had really nice week. I know oils at a new bottom, and thats part of the problem. But eog resources, a lot of the drillers and the exploration companies, eog is up about 8 . Marathon oil is up almost 9 on the week. Thats a huge move for them. These are daily changes, you see, but trust me, theyre up. And we also had some nice moves on some beaten up industrials. The industrials have gotten hit badly on global slowdown concerns. Not this week. Caterpillar was up more than 2 . Ge was up more than 1 . On a week where the s p was not even up 1 , those are nice moves on big names. And that helped the Dow Jones Industrial overall. Heres something thats interesting. We have had nice moves up in defensive names in the last few weeks, on those Global Growth concerns, well, not this week. Walt disney was down this week. Budweiser was down this week. Most of the other big defensive names in the consumer space were down as well. And weve also seen, remember, financial stocks were market leaders . Well, once we saw Interest Rates start coming down as well, theyve been faltering. So most of the big names are citigroup, your Morgan Stanleys, your jpmorgan, your Goldman Sachs, all of them were down on the week. So, it was a little bit of a turnaround from whats been happening in the prior weeks. And as i said, kelly, the biggest problem is, weve been burned before, particularly on buying the energy names. Less so on buying the industrial names. Now what weve got to clearly see, oil has got to stabilize and move up for energy to work. It is not buy oil stocks and oil then moves. Its the other way around. Oil moves up and then Energy Stocks move up. Thats the historic pattern. This is not going to last, this rally in energy, unless we see oil move up a bit. Kelly, have a good weekend. Bob, you too. Listen, before we started, what about the fact that a lot of these ipos, lately, theyre struggling. I mean, lately this month, theyre up maybe 8 . Weve had smaller names but higher profile misses. Are we going to see a turnaround in that when we start to head into september . Theyre struggling because the market overall is struggling. And when the ipo when the market struggles, the ipo market struggles. If we stay in august and september, in a pattern where the market is still unsteady and on a slight downward trend, which is what weve been in the last several weeks, were in no ipo land right now. Nobodys doing the ipos over the next several week weeks, but thk past labor day is when the ipo market picks up. If were still weak then, youll see cancellations. Youll need a few weeks before you determine the overall market trend. Ipos follow the market. Very simple. Thank you, bob. Good to see you. So we have ipos doing a little bit. Theyre doing a little shaky. People just rethinking the names they bought on china exposure, do they still want that. Give us some ideas going into next week. My idea to investors is, dont try to make too much of what goes on in august. Try to take a view, you know, six months from now, what will the Global Economy look like . If youre in the guy adami camp, in which theres deflationary pressure worldwide, the Global Economy is going to be very slow, then you want to sit in bonds and not do anything. If, on the other hand, you kind of take a slightly more optimistic view of the world. I was in europe this past week and still optimistic . Its just, you know, your not going to have, you know, european economies growing at 3. 5, 4 . Its just not going to happen. But if you can get a european economy growing at 1. 5 to 2 , thats a big step up in Global Growth. Right now, its not even close that. Guy, do you want to respond before we go . I think when you travel as well as evan probably does, everything looks rosy. He travels in first class, im in the back of the plane. I think thats one aspect. The other aspect is, bob talked about industrials. Ill give you one more. Look at defense stocks, and thats something we have been positive on for quite some time. Lockheed martin today, alltime high. I think the valuations are still reasonable. So although, yeah, i dont think the world is that great, there are pockets that look interesting. And quickly, the ibb has exactly a 10 correction since the july alltime high. Traded down towards, i think, 360 off that 400 high we recently made. Maybe thats due for a bounce as well. Im not all doom and gloom. Im happy look at the backdrop i got here. How bad can things be . It is lovely, guy. And before we go, theres much more coming up with guy adami on fast money. A very special edition, 5 00. Live from beautiful San Francisco. Theyre going to reveal what guy adami does when hes not trading and heres a sneak peek. Lets wait for some passengers. Wow looks like i got my first pickup. Its lanea and shes not that far away. Here i go here she is. Im going to get out and get her in the car. Are you guy . I am. Are you lanea . Yes. Pleasure. Oh, pleasure to meet you. Likewise. Enter the vehicle, young lady. So how long have you been driving . About 35 minutes. Yeah . Ride is nice. Youre my first passenger ever. You have a nice day. Likewise. Whats with the fist pumps . Youre a lift driver, guy . Whatd you learn . Listen, things are tough, you know, you got to make a living. I had a great day, though. I love to get evan one day, take him to the airport. It would be fantastic. We just hope hed give you a good tip. I know. Im a big tipper. Im a big tipper. I cant wait to watch the rest of this. Guy, thank you so much for joining us. Much more coming up, as mentioned, on fast money at 5 00 p. M. Oil plunging 20 in the past month. Up next, well break down the data to show you why Big Oil Companies may be about to rally. And what stocks warren buffett, carl icahn, and bill ackman buying and selling . Their quarterly filings are coming up today. Youre watching cnbc, first in business, worldwide. It took Joel Silverman years to become a master dog trainer. But only a few commands to master depositing checks at chase atms. Technology designed for you. So you can easily master the way you bank. Welcome back. Oil has been crushed over the past month, down 20 . But why now seems to be the time to buy oil stocks. Hi, deidra. Hey, kelly. Certain oil stocks, that is, it pays to be picky here, because some stocks outperform, while others, far less so, outperform consistently, that is. So we used data to look at what happens to oil stocks a week after crude plunges 20 plus in one week. There have been eight instances since 2005. A week after that terrible month for crude, chevron and exxonmobil, the two majors, they are the best performers erers o dow industrials, they return nearly 5 on average. A few smaller independent oil companies, they do even better. Occidental petroleum, apache, eog resources, they have traded higher 100 of the time. Thats eight out of those eight past instances. And they also see outsized gains, as you can see on your screen. Exxon and chevron are huge players and the three that i just mentioned have strong Balance Sheets and are conservatively managed. That may be why you do see them outperform, but msome of the other oil players are far less consistent. Its a coin toss for schlumberger and conocophillips. They trade higher half the time and lower half the time. As for oil itself, largely volatile after this happens, with a deeper downside overall. The s p 500, by the way, basically flat after a month where crude drops by 20 or more. So kelly, when it comes to the historical data, may not see stocks broadly rebound, but there are a few good bets, at least if you look at the historical data, and this is, of course, all based on history, kelly, so it doesnt ensure thats going to happen going forward, but stocks are really interesting to look at. Deidra, thank you, appreciate it. Joining us to discuss more on what could potentially stop oils decline is chief commodity strategist at rbc capital markets. Welcome back. Thank you. Everyones wondering, where does oil find a bottom . What do you think . Supply got us into this problem, supply will have to get us out. This is the problem. Opec came out, 100,000 barrels, up. Everyone was looking for north american production to roll. Opec production is not rolling at this point. And demand has been strong. What i find so frightening about this market, is demand may be up by 1. 5, 1. 6 Million Barrels year on year and we are in this price environment. They cannot soak up all these barrels that are floating around. Let me ask, kalima about specific companies. The saudis are kind of driving this, right . So ive been told. At what point do the saudis go, you know what we are out yeah. At what stage do day go, this is enough . What i find amazing is, they resorted to borrowing this week for the first time in like, you know, since 2008. I mean, theres been a view that the saudis didnt want to go back to the 90s, didnt want to borrow, didnt want to run down their reserves like this. It doesnt seem like right now the pain is deep enough for them. What could potentially make them call it quits, i think . Youve got to move a leg lower, stay lower. So brent crashes below 40. Maybe they reconsider. And maybe theyre waiting for another country to go off the cliff first. Venezuela venezuelas already off the cliff. Which brings me to russia. What role does putin play in this . The russian government cant be happy. This is a great question. Russia and saudi are linked. The saudis will tell you that they were prepared to cut going into the november opec meeting. They wanted the russians to cut with them. They say the principle they established after 86 is, we dont balance the market alone. Nonopec, particularly russia, who theyre fighting for market share into china, russia has to go with them. The russians said no, they keep asking the russians to cut. So i think thats the quickest path to an opec cut if russian puts up their hands and say theyre out. Also, russian exports are up. They did tax changes and russian exports are up. Back to north america, then. What is the net effect about the news that we got about mexico and potentially being able to export to mexico now . One of the things, a big question for producers is, when you see storage filling up, the thing theyre demanding is the lifting of the export ban. People are wondering, is this the first step in potentially getting that export ban lifted . Im not sure it is. Congress has to, i think, really have to get into this. They have to basically carry this issue. I dont think the white house is going to front the issue on lifting the crude export ban. But i think it could potentially give more momentum to congressional efforts. Do you think its unreasonable for people to Start Talking about oil down as far as in the 20s per barrel . We dont see the 20s yet, but the path of least resistance now is lower. Helima, thank you so much. Lets get out to a news alert on a pair of big hedge funds, kate kelly. The 13f filings on Money Managers flying in. Within the last couple of minutes, weve learned that David Einhorn has added dramatically to his position on gm. David tepper of appaloosa also adding to gm. Two bulls there. Just to take a quick look at the numbers. Einhorn adding 5. 1 million shares to his stake, bringing him close to 15 million shares. Surprisingly, stock not moving on that news, at least not in a green direction. In addition, einhorn takes a new stake in 21st century fox, close to 2 million shares. That adds to some of his media holdings, he also owns time warner and increases his stock in Micron Technology. He has a huge position and seems to be adding to it. Finally back to david tepper from appaloosa, taking new stakes in alibaba and apple. Apple, obviously, a popular name. Alibaba, interesting, though, because others are getting out of it at this time. So youre seeing a mixed bag there, kelly. Kate, thank. Obviously wanted to hear from all of those. Wehle keep an eye as we continue to get more filings coming through here. Now, are drones becoming a threat to our safety . Our next guest thinks they are and wants to make it a crime to fly drones near fires that put firefighters at risk. At ally bank no branches equals great rates. Its a fact. Kind of like shopping hungry equals overshopping. Aaflac . Aflac i thought you said this guy was the best . Oh, hes a horrible stylist. Gah . But hes the best at paying claims fast really. Mmhmm. Paid mine in just one day. One day . Yea. Aaaflaaaac in just one day, we approve and pay. One day pay, only from aflac. Dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is, can your business deliver . At ally bank no branches equalsits a fact. Kind of like mute buttons equal danger. That sound good . Not being on this phone call sounds good. Its not muted. Was that you jason . It was geoffrey it was jason. It couldve been brenda. Welcome back. The federal Aviation Administration reporting the number of piloted drone sightings have more than doubled this year. 650 so far of them compared to just 238 last year. Drones becoming a bigger problem across the country, from crossing commercial jets to wildfires in california and arizona, where Authorities Say theyre interviewing with firefighters efforts. California assemblyman mike gano is working to push through legislation to stop interference. It sounds like what you want to do is top existing protocols against drones, so it would be 25,000 or jail time. How much of an issue is this where you are . Were all familiar with the issue of captain Sully Sullenberger having to land his plane in the hudson river because of a bird strike. You just imagine when a drone, which is made of metal and plastic, if it were to come in contact with a firefighting aircraft that was fighting a fire over a mountain, the affect would be catastrophic. U. S. Forest service has said that there are 13 incidents of drones interfering with the fighting of wildfires in 2015 alone and just 11 since june. Its possible, assemblyman, some would argue, the drones could help fight wildfires, though. If at some point they had the technology to help dispel chemicals or waters or whatever it might be to help control these blazes, would that be a different story . Is it a way to stop from outlawing this altogether . Oh, absolutely, drones can be a force for good. But whenever a new technology emerges, you have to have some rules to make society comfortable with that technology. When cars were a new technology, concepts like having insurance to cover the cost of an accident and tickets for parking in front of a red zone, these things were new concepts, but the laws the needed to evolve to make sure that society would feel comfortable with that new technology. Mike, its evan newmark. I have a question. Should the regulation and the rules be happening at the federal level or at the state level or local level . Youre a california assemblyman. I dont know what the right way is to deal with this . Is this better from the ground up or does it need to be a National Policy . Well, with evan, you know, the last thing that i woke up saying what i want to do is make a law to affect drones fighting wildfires. The shame is that, as you guys know, getting the federal government to do anything lately is like pulling teeth. Theres so much gridlock in washington, d. C. That i think state officials across the United States are going to be forced to act to exercise their police power to protect their citizens. We had a fire in Southern California where drones interfered with the efforts. It didnt just puts the pilots at risk, it put everybody on the ground at risk, because the fire was allowed to spread. When a drone is sighted, they have to stop all firefighting efforts. This fire jumped the freeway and burned several cars and we have to say, enough is enough. And while thats a tragic situation, one thing, assemblyman, that the faa has resisted doing that they potentially could do is allocate air space and to say this air space is acceptable for drones and this air space is acceptable for planes and a drone cant fly where a plane can fly. Would that not fix this problem . Yeah, i think thats exactly whats needed. Weve heard signals like the faa, at some point, will say that states can regulate anything beneath 350 feet. The federal government will regulate anything above 350 feet and there will be a corridor for amazon to deliver packages between 350 and 400 feet. I think they need to step in and make rules and make them asap. I dont want there to be a tragedy before they step in and enact. Thank you so much, mike gatto of california. Lets get to Courtney Reagan with our cnbc news update. U. S. Marines raising the American Flag at the u. S. Assembly in cuba for the first time in 54 years. Marking the restoration of diplomatic relations between washington and havana. John kerry, who led the ceremony, is the first secretary of state to visit cuba in 70 years. Well, nba superstar lebron james is promising kids from his hometown of akron, ohio, free college educations. Thats if they graduate from high school as well as fulfill a Service Community obligation. His foundation is partnering with the community of akron. That comes to 48. 1 million. Well, after more than 60 years, the harlem globe trotters have parted away with their longtime on thes, the washington generals. The generals won one game back in 1971, while losing more than 16,000 times. No reason given for the parting. And a chilling moment caught on tape. A shark was spotted swimming very close to the shore in province town, massachusetts. Fortunately, no one was swimming nearby. Earlier this month, researchers say they spotted 17 sharks in just one day off the massachusetts coast. Thats a cnbc news update at this hour. Kelly, back to you with that scary video. Yeah, courtney, thank you so much. Not going swimming out there anytime soon. Maybe they should use the drones to watch the sharks. To try to control them. I bet they do use drones to do that. Im watching the alaska bear camera right now. How should you be making sense of the see saw market . Up next, john calamos tells us whether hes worried by china and the fed and how hes putting money to work right now. And well round up with the nations Largest Hedge Fund managers have been buying when we break down their latest s. E. C. Filings. Stay tuned. Plp p everything about that one breed. But in fact, there are over three hundred breeds of dogs. Because no one can be an expert in every one. An app powered by ibm watson will help vets tap Specialized Knowledge in the cloud for every breed. And whatever else walks, flies or slithers through the door. Ibm watson is working to make medicine smarter every day. Yup, were constantly making thinkorswim better. Here at td ameritrade, theyre always working. Like a custom screener on your desktop, that updates to all your devices. And you can share it with one click. Wow. How do you find the time to do all this . Easy. We combined every birthday and holiday into one celebration. different holidays being shouted back to work, guys i love this times of year. For all the confidence you need. Td ameritrade. You got this. Welcome back. Lets take a look at how we finished the day on wall street. The dow adding about 70 points and up about 150 on the week. Nasdaq barely managed to stay positive and one of the worst performers this year, thats the Energy Sector did lead the way this week, up 3 . The weakest was consumer discretionary. Utilities, by the way, out of favor in the first half of the year, but theyve been roaring back so far in the third quarter. Now lets get out to more details on what some of the nations Largest Hedge Funds are buying and selling these days. Kate kelly is here to round it up. This just out of major new stake in Starwood Hotels the from john paulison who would appear to be the number one holder with 12 million shares of the hotel company. Paulson also going big on broadcom, with a new 4. 2 million share stake. Earlier today, a surprise move by Tiger Management into lumber liquidators, its been up as high as 8 as a result of that news. Its really been a beaten down name this year. Elsewhere in todays filings, a number of Money Managers seem to be perceiving a bottom in energy or at least an awfully low entry point. Omega, viking, and janna piling into the sector and choosing some unfavored names, including pioneer natural resources, the driller referred to mockingly by David Einhorn earlier this year as the mother fracker, a company that relied on some questionable accounting metrics and perhaps had an overly bullish outlook, raising questions for him about whether it was a good buy. And finally i want to mention berkshire hathaway. First of all, they note in their filing that there is some confidential information in terms of what theyve been doing in the stock market recently that has been omitted. Always Something Interesting there. That will come out eventually. They also report a new 20 million stake in exalta coating. And finally they increased their Charter Communications stake by 42 to 8. 5 million shares, worth about 1. 5 billion. Wow. Charter. Thats interesting. All right, kate, thank you so much. A roundup of all the action for us. And with all the recent volatility in markets here at home and abroad, how can investors differentiate where the real opportunities are . In a cnbc exclusive, we are now joined by john calamos from calamos asset management, from overseas, over 20 billion in asset management. Welcome back, john. Glad to be with you, kelly. Weve had a lot to digest this week. We just got a bailout deal announced with greece and its creditors. Oil price plunging, but Energy Stocks rallying. Whats an investor to do . Well, i think were in one of those periods at this part of the cycle that there is a lot of volatility, theres no doubt about that. But i feel were still positive on the equity markets going forward. But we are going to have more volatility of the factors that you just indicated. Would you stick, john, with the winners so far in the second half of the year . And those would include the utilities, the financials, even. Are those sectors, broadly speaking, that you like, or do you think investors should gauge this market differently . Well, we would say the market is turning more towards the growth areas of the market. So the growth sectors rather than utilities. We think that at this phase of the market, growth will start to outperform the general market in here. So, we would not be favoring utilities in here. And when it comes to the Federal Reserve rate hikes, i mean, that was the argument against utilities, but as weve seen, the more we talk about them going in september, the more Interest Rates seem paradoxically to fall. How do you think things shake out here . How important is that first rate hike and what would you do with ratesensitive investments . Well, i think its very interesting. I think the Global Market currencies and all of that have already anticipated the rate hike. And quite frankly, i think a rate hike is positive, not negative. I think the faster we can get to normal Interest Rates, the better the economy will go going forward. So, i anticipate that, in the way the fed has really said in here, it will be a small, gradual hike. I think it will be this year. This year, all right. Evan . John, i have a question regarding your business, which is active fund management. How are you finding it in terms of competing for funds now ad s adays . This a Good Business to be in, or are you losing business to etfs and the other passive investment vehicles . I think the active versus passive, obviously, over the last couple of years, passive has gained a lot of the flows, was i think were getting into an environment now that active is going to be much more so. And this is not any change in past decades, the same has happened where, you know, the passive sort of outperforming you know, performs active. But i think were if a period now where active will really take hold again. All right. And weve seen a little bit of that emerging here. Just before we go, john, a record year for mergers and acquisitions. Yesterday we were talking about it. Its a low growth environment, Companies Looking to push down expenses and find some way to increase their sales. How do you read all of these plays . Is it a good sign, ultimately, do you want to get involved in these sectors that are in the most deal making, or is this something thats going to come back and haunt us . No, i dont think its a negative at all. The m a and all the activities going on there, i think its a positive. Its really part of a very vibrant economic environment in the sense of people looking for opportunities and mergers and acquisitions. And as you know, theres a lot of cash on the sidelines, you know, in capital. So, putting that to work, i think, is a positive rather than a negative. John, always good to get that chicago perspective here. Keep our heads about us. Appreciate it. Have a great weekend. Thank you, thank. Thats john calamos of calamos asset management. Republican president ial hopefuls descending on the iowa state fair today. Up next, well tell you what some of the leading candidates are saying in the hawkeye state, and you wont believe some of the crazy food for sale this year. Speaking of crazy, watch out, hollywood. New stars are making big bucks on youtube videos. Were going to speak to one. Captain sparkles, when we come back. The Gillette Mach 3 turbo still feels better after 10 shaves than a disposable on its first. Mach 3 blades have twice the coatings. For a closer shave with zero redness. Get an incredible experience shave after shave after shave. Gillette. The best a man can get. Iowa is a crucial stop for president ial candidates on the campaign trail. Its the first state to cast votes in next years primary elections. Thats why many white house hopefuls are visiting the iowa state fair to take the makeshift soapbox stage. Jeb bush was one of the republican kacandidates to take the stage earlier this morning. Im a republican and im a proud conservative and i have a record of reform that is unmatcheded of anybody running. But i believe in order to fix these things, we need to come together as a nation. Im tired of the divides. I respect people that dont agree with me. Its okay to disagree with me. Lets get more from our john harwood, who i thought was in iowa, but ive since been corrected, john, so i wont ask you to bring me that pb j on a stick. But what have you gleaned so far from what weve heard . Lets begin with the gop hopefuls here. Well, you know, this republican race is wide open right now. Jeb bush, who we just heard from, is the presumed frontrunner, in part because hes raised so much more money than anybody else, but he hasnt dominated in the polls by any stretch. Donald trump, of course, has shot to the top of the polls in iowa and New Hampshire as well as nationally. Marco rubio, scott walker, john kasich, all these people, ben carson, all these people are making an imprint on the race and its kind of a free for all right now with the situation seeming to be artificial, because most people assume donald trump is not going to stay at the head of the pack. And so all of the people like bush and walker and rubio and kasich are trying to position themselves to take advantage if he begins to crumble. Yeah, how about the crowds and the enthusiasm . Because we know one thing that Trumps Campaign hasnt really done is that iowa local level organization. Are the ones who are putting more funds into those traditional methods of raising awareness seeing better turnout here at all . Well, you cant really tell at this stage. You know, everybodys beginning to build an organization. Donald trump may even invest some money in a Ground Organization in iowa. What we can see, so far, is crowds at the various events theyve had. Donald trump had pretty good crowds at his. Bernie sanders, kelly, on the democratic side, is the one whos had very big crowds, stunning, really, and that just shows how, at this stage of the race, people want to hear something different, something fresh. Kayla . John, there was a piece in the Washington Post today that got a lot of buzz, and that was robert costas, who has that donald trump is surprisingly actually trying to win in iowa, and the evidence is that he has a pretty extensive staff there. Im wondering if theres any other evidence that youre seeing that his campaign is picking up across the country, other than just maybe the buzz in the crowds. Well, the question, kayla, for trudonald trump, and its t of all selffounding candidates, is that are you going to lay out your own dough, not money youve raised from somebody else, to try to win the election. And there tends to be a threshold point where the person says, am i on track to win this . Is it worth it to me . After all, these people dont get to be billionaires by being stupid with their money. Ross perot was leading in the polls in early 92, he got out of the race that summer. He was not willing to lay out the kind of money to build that kind of campaign. He later got back in. Donald trump will have to make that decision. Is this just fun . Is this entertainment for me . A Reality Tv Show in a different form . Or am i really going to invest in a campaign. If he makes that decision, then ads, organizations, hes going to have to write some big checks. We got to let you go, john, but i have to just ask, does it seem more likely that the vp, joe biden, will get into this race . I do not think that joe biden will end up getting into the race. I think hes exploring it. His aides are trying to preserve his options. I dont think thats where hes going to go. And theres been speculation lately about al gore. I definitely do not think hes going to get into this race. All right. Thank you. Our john harwood from washington. And by the way, i know, guys, i joked about this a second, but fried pb j on a stick is one of the new foods offered for the 2015 iowa state fair. I want to know where he stands on gluten free corn dogs. I like the 27inch super chili beer. What is that . 27 degrees. They chill it below freezing. Oh, its chilled beer i cant read i thought it said chili beer. And weve ordered the deep fried nacho balls for kayla. They are coming with the apple pie on a stick. Im serious, i love this. Theres something about the economy of the world we learn from these. What did you learn . Im still figuring it out. Youtube has been drawing viewers and boosting googles bottom line. Captain sparkles will tell us how his videos have reached nearly 2 billion, with a b, views and how much hes actually making from all this content. And apple maybe delaying its highly anticipated live tv streaming service, but the tech giant reportedly speeding up progress on another big initiative. Thats coming up. Its a fact. Kind of like shopping hungry equals overshopping. Lily lily, may i call you lily . I dont really know what else youd ca lily, i want an iphone, with a great data plan to share pictures of this smile. Well, all of our mobile share value plans come with rollover data so the data you dont use this month rolls over to the next. Wow. Using unused data for all sorts of uploads. My constituents love. To. Watch. Me talk. Todays leftover data means a Brighter Future tomorrow america. Write that down. Right now, get 300 credit for every line you switch to at t when you buy any iphone for 0 down with an eligible smartphone trade in. At ally bank no branches equalsits a fact. Kind of like mute buttons equal danger. That sound good . Not being on this phone call sounds good. Its not muted. Was that you jason . It was geoffrey it was jason. It couldve been brenda. Youtube is one of the big moneymakers for google and youtube stars like captain sparkles are some of the big Drivers Behind that success. Hes been gaming his way to stardom online and now hes bringing his gaming expertise offline teaming up with activision cofounder howard marks to launch the new mobile game startup called xreel. Its had 2 million downloads for its newly launched game fortress fury. Hes the latest in a growing list of youtube stars and join us exclusively now. Jordan marin, the Youtube Gamer also known as captainsparklez. Where did you come up with the name . It was a dare from a friend. I had a channel with another name before it and i was talking with a friend about changing it and he said hey, you should try the name captain sparklez and i didnt think much of it at the time. So i went forward with it. And now thats what everybody calls me. Jordan, how old are you and how much money is captainsparklez made you . I am 23 years old. Im able to make a decent living off of it. So i do it fulltime. Six figures . Seven figures . Its a fun thing to do. Give us a ballpark. Enough to live comfortably. Okay. Where did you go to school, jordan . I went for a year at university of california at Santa Barbara and then after that i ended up pursuing the youtube thing fulltime. And its something, evan, youre familiar with your son. I want to know, jordan, what is your target demographic or who is it that really knows captain sparklez . Is it a teenage boy . Is it somebody like my son . I would say its probably the average range is about 13 years old. They play video games obviously. And i think for the most part people get started watching youtube because they want to get like tips relating to how to play games and then they can get drawn into the personalities there on youtube in the gaming space and sort of start following along certain channels. Im sorry. What was it about your channel that you think struck a chord with your audience, and were you ever surprised that there is a market for people to watch you playing minecraft . Yeah, you know, im still kind of trying to figure out what it is exactly about me that draws people in. I always saw myself as more of an introvert. And so i played a lot of video games and thats why i started getting into this. And maybe its that people can relate to that. I try putting effort into more higher production value projects as well. So maybe that helps. But still, i dont know. People i guess enjoy watching what i do when im playing video games. And so they follow along. Now, is qd pie, is he a competitor of yours . Are you guys in a sort of mano a mano death match for control of youtube over the gaming channels . Or are you guys more sort of side by side not competitors . You know, i guess obviously theres only a finite amount of time each day for people to watch videos. But i dont really see anyone else as competition. Id much rather work together. I like collaborating with other channels as part of thats one of the funnest parts of doing it is getting to meet other people and put our efforts together to make something that we couldnt do individually. So i definitely dont see anyone else as direct competition. Again, its become big business. We know twitch, which is now owned by amazon. Youtube. These are some of the biggest users of internet bandwidth on any given day. And the amount of time people are spending on these sites often to watch people like you, jordan. Just a final question. Tell us about this new gaming startup xreal. Is it a new chapter for you and for everybody here in the evolution of gaming . Yeah. So we hope so. I teamed up with howard marks, who is a cofounder of activision, and the goal is to bring mobile competitive gaming to a larger crowd. Fortress fury is our first title, and its a competitive game. You play against other players in real time. And our goal is to bring tournaments with real cash prizes, and so thats what were working toward right now. Weve always started doing some equity crowd funding for that attempting to get fans on board to participate in hopefully a future up side to the company. All right. Jordan, thanks for joining us. Or should i say captain sparklez. Were amazed at all your success and wish you the very best. Thats jordan mayron. Thank you so much for having me. I appreciate it. Thank you for joining us. When you think of selfdriving cars, you probably think of google. Now a major rival appears to be hitting the road and getting into the business and well tell you who in just a moment. It took Serena Williams years to master the two handed backhand. But only one shot to master the chase mobile app. Technology designed for you. So you can easily master the way you bank. Its a gold n opportunity to elevate each moment. Hit every mark. Thread every needle. Turn every ride into a thrill ride. Come in to the lexus golden opportunity sales event, where youll find some of the best offers of the year on our most exhilarating models. Lease the 2015 rc 350 for 449 a month for 36 months and well make your first months payment. See your lexus dealer. More and more, data is visual. In fact, the number of mris has increased by ten percent a year. And a radiologist might view a thousand images to find one tiny abnormality in shape, contrast or movement. Because its so challenging, a Research Project is teaching ibm watson to see. In the future, it could help clinicians spot key patterns quickly and precisely. Ibm watson is working to make healthcare smarter every day. Google may be getting some major competition in the selfdriving car business. Josh lipton with the details. Hi, josh. Well, kelly, the competition is apple, which is reportedly building a selfdriving car and scouting locations to test it. That is according to a new report from the guardian, which says it obtained an email from an apple engineer to go memtum station. Thats a 2100acre testing ground for Autonomous Vehicles in San Francisco. The email suggests apples interest in using the space but doesnt mention a driverless car. The company declining to comment. But remember apples Jeff Williams recently talked about the companys interest in cars at the code conference. The car is the ultimate mobile device, isnt it . Look, we explore all kinds of categories, and well certainly continue to look at those and figure out which ones are ones where we think we can make a huge difference. Even if theres truth to this report, a selfdriving car would still be at least five to seven years out. And skeptics counter that while ceo tim cook might want to control the User Experience in the car that doesnt mean he has to build one. Kelly, back to you. Thank you, josh. Guys, this is legit. Android is already signing people up. Theres going to be a battle already taking place to own the software thats in these cars. You cant blame apple if the technology is moving in that direction to at least explore it. But i think josh is right. We cant really know what their intentions are strictly based on a oneline email. I was staggered by the fact that uber was doing this. So if apple does it im not surprised. But uber was smart about it. They went to carnegie mellon, which is the premier place for 20, 25 more years has been doing a lot of this. Uber cant even get their cars to run in paris, and theyre already worried about selfdriving cars. I think thats pariss fault, not ubers fault. Zbliem not being critical of uber. Im simply pointing at youre a little too obsessed with this whole topic. And rightly so. So many dimensions to explore. Thank you guys for joining us today. Evan newmark, Kayla Tausche. You guys as well. Fast money begins live from San Francisco right this moment. Welcome to fast goes west. We are back for one more night in sunny San Francisco, keeping you up to the minute on all the biggest Investment Opportunities from real estate to tech in one of the hottest cities in the country right now. Im melissa lee. Dan nathan here. Guy adami with us once again. Hi, guys. Hey, mel. Survived another night here. Tonight on fast it is one of the worlds hottest luxury housing markets and we are right in the thick of it. Inside some of San Franciscos largest and most extravagant houses this citys got to offer. Plus were getting in on the Silicon Valley lingo and talking the latest tech