Explain that. Also, one of the most hotly contested stocks out there due with earnings in about one hour from now. There it is right there. Herbalife, the stock is having a nice day oh, its having a nice year. Up more than 80 this year. Noted herbalife cynic, our own herb greenberg, is going to be here when the news hits the tape. Its the story that has many asking what in the world is steve cohen thinking . On the weekend after seeing his firm indicted, he throws a flashy party at his hamptons home. Its definitely legal, but is it smart . Well discuss that ahead. And the markets right now, lets look at where we stand on this monday on the street. Its been somewhat of a quiet day. Not a quiet week ahead of us, though. Theres the dow at this hour. It is down 23 points. Take a look at the nasdaq and the s p, as well. Were negative across the board. Modest losses as we await a whole bunch of news coming down the pike this week. Joining us to break down all of it in our closing bell exchanges is danny hughes from divine capital, mark from Janney Montgomery scott, stan from s p capital iq, and our own rick santelli. You know what, rick, im going to start with you. Because there is so much happening this week, youve got the dollar to watch, youve got rates to watch, the fed, the ecb, the boe, gdp take it away. Well, i think the gdp is fascinating, because when i was talking to one of my favorite economists, jim bianco, this morning, the past two recessions might disappear with the new methodology. Id like to ponder that. I think viewers and listeners should ponder that. When were looking at Interest Rates, hovering south of 2. 60. We briefly traded north of 2. 60. Havent closed above that level in close to three weeks. And youre right, judge the dollar, if you look at a chart over the last couple of months, its been weak. If you look at the dollaryen in particular, you can see one of the antagonists to that relationship. If you look at the nikkei, you really scratch your head a bit. A big reversal the way the japanese markets and the stimulus motor rehaving several months ago. But i think top of the heap is to continue to monitor the aspects of the differences between corporate profits, stock market indices, and growth as measured by gdp, even if its reformulated state. Of course, monitoring the fact that you could walk it back all day, but were still about 35 to 40 basis points more rich on a 10year than we were before some of the taper walkback started to go full force. Yeah, rick, i know thats a number that a lot of people are watching. And among the things that scott mentioned, there is one thing he didnt mention and thats gold. Danny, when you look at gold, do you see it sort of decoupling from the s p, sort of hovering the a the 1,320 level. How should we be looking at gold this week, and where are you seeing that going . Still sideways . A sideways trade, especially this week. This is a busy week. Its a rambunctious week, if you will. I think one of the things three things were really watching, although theres a lot on the dashboard, a lot of noise out there. Correlations is a big one. You know, everything is kind of decoupled since april. You know, we saw all of the tradeable Asset Classes go exactly in the same direction for so long, back then in april, everything started to unwind. You saw currencies and then commodities, bonds, stocks. So now, everythings up for grabs. And i think that that is because weve set the table for tapering. So were definitely going to eat. We dont know when thats going to happen. Next is profits. You know, were seeing big profits, but where is that Global Growth going to come from . Thats a big question that we have. And buybacks, too. Buybacks have been tremendous since ending in the First Quarter of this year, yearoveryear growth of 17 , 400 billion of buybacks hit the tape according to them, so thats a big number. Many a, put it all together. What does it mean . Its a huge week. A makeitorbreakit week for this rally given everything in front of us. I think the market is trying to find a new catalyst. Right now going through a bit of a consolidation. I dont think it will be enough to call it a pullback, meaning a decline of 5 . And then, i actually believe were going to go and retest the 1,700 level. We see typically that century marks are important levels, takes a couple of attempts like a rusty door to break it open before it swings open. The belief is we head up to about 1,740, 1,750 area and reevaluate. And didnt mention the fact that you have 135 Companies Reporting earnings this week. So lost in the shuffle of this tremendously busy news week, youre going to have a lot of important reports out. Companies that youll be glad you forget about them this week, lets be honest. Happy about it, im sure. Earnings have been pretty good. And so, i think that the feeling of that has kind of kept this market where it s i think were only down, you know, 25, 30 points or Something Like that today. And its pretty quiet. So its a good thing. But, mark, i know this is set to be the best month since october 2011, even with the trade today. We have two days left after today. Do you think that were due for a correction with window dressing, with the fed . I mean, you name it, theres a lot that could bring this market a leg down in the coming days. Well, whats been mentioned before, you can see that this week alone is going to give the market plenty to chew on and could alter the direction that weve had in the equity market really for the first 6 1 2 months of this year. I do think the markets probably ripe for a pause. Mostly whats been driving stock Prices Higher has been multiple expansion. And i think, obviously, with the earnings, while beating about 70 of those consensus estimates so far, still only growing about 2 or less on a yearoveryear basis is not going to be enough to inspire Market Participants to drive equity Prices Higher, at least at the moment. And so, what i think were going to need to see is economic validation, which we do think is a secondhalf story, that will then be that which pulls forward Profit Growth once again, and thatll be the cause for the next leg up in equity prices, which very similar to sam, we do believe that ultimately theres still higher highs to come in the equity markets than even where were at today. I mean, the last time we had this we had a 6 or so pullback, everybody thought that was the start or at least in the midst of what was going to be a much deeper correction than it turned out to be. Why, mark, are we to believe this is anything more than a slight pullback . Youll get highly accommodative language out of the fed on wednesday or thursday, whatever the day they come out with the statement and you know what the Market Reaction is likely to be. Well, i agree with you, scott. I dont think it is likely we see that precipitous decline again, simply because, one, the fed policymakers are exceedingly careful this time through recognizing the shock that they applied to the market on june 19th when just talk about tapering was enough to move both the equity and fixed income markets. So theyll be very careful with their language, and i think leaning more dovish than hawkish at this juncture. And in addition to that, theres still so much skepticism out there relative to equity prices and sideline cash as a result thereof that i still think whatever pullback we might see is going to be short and shallow, because i think investors still believe they have to remain committed to risk assets or equity prices given the fact that i think the climate will ultimately prove fertile for corporate profits, even if you have to wait a couple of months to get validation on that front. In the meantime, the pain of the alternative lowyielding bonds or cash have high costs for opportunity. All right. Guys, thank you so much. Josh lipton, market flash. Whats going on . Scott, a quick review of some big movers in todays trade. We want to start with interpublic in the green, off session highs saying it does not see a need for a major merger or acquisition following that merger announcement we heard from omnicom and publicis. And announcing they would have a share repurchase. Another i want to mention, caterpillar, repurchasing 1 billion in shares from sog gen. And well end on herbalife, scheduled to report after the bell. The street wants to see eps of 1. 18 on revenue of 1. 2 billion which would represent yearoveryear growth of 8 and 12 respectively. Carl icahn saying its undervalued, said he has made 250 million and has not sold a share. You heard about the billionaire brawl here, icahn is long, ackman is short. Back to you. All eyes on herbalife after the bell. Well keep you around to watch that with us. Right now, about 50 minutes before the closing bell on this day at the end of july. We have the dow thats down just about 29 points. The s p is down just about 5. Talk about a bearish call. Our next guest says the dow is going to reverse course and reverse course in a dramatic fashion and hit 5,000 before we ever see 20,000. Hes going to make his case next. Yeah, were interested to see how he makes that case, especially given the bull market. We also have starbucks reporting better than expected earnings last week. The stock is up 50 over the past year, and now the store is rolling out a new initiative to get you and your smartphone inside. Stay with us. Well have that story. Well be right back after this break. Clients are always learning more to make their money do more. ann to help me plan my next move, i take scottrades free, inbranch seminars. Plus, their live webinars. I use daily market commentary to improve my strategy. And my local scottrade Office Guides my learning every step of the way. Because they know i dont trade like everybody. I trade like me. Im with scottrade. announcer scottrade. Ranked highest in Customer Loyalty for brokerage and investment companies. All right. Welcome back. We want to recap a story i brought you at the end of street signs. We want to look at shares of cf industries. Third points dan loeb revealing a position in that stock today in a quarterly letter to his investors, a letter i have obtained. Theres a look at what the stock is doing as a result. Also, mr. Loeb is stepping up his criticism of sony entertainment. Remember, hes taking a near 7 position in sony as he urges that company to spin off its entertainment unit. He does say in the letter hes surprised that sonys ceo doesnt worry that the entertainment unit continues to generate profitability levels far below its competitors. He sent a couple of letters now to the ceo of sony, and, kayla, were waiting for sonys official next move. The ceo has saidwouldnt be opposed of course, given the time difference between the u. S. And japan, we could get something overnight. Thats when we tend to get news out of sony. So it certainly will be interesting to see how he responds to this. The cf strad, i think, is interesting. You saw the stock jump to 8 . These are very, very highyielding, Free Cash Flow companies. Very competitive space. A lot of m a. There are a lot of strategic movements in this space, and so, its no surprise that something that generates as much cash as one of these Fertilizer Companies does, that you wouldnt see someone go after to start returning some of that to shareholders. Which is what he wants to do. He says in the letter we believe its structural cash flow generation strength, misunderstood, that management should deliver a much larger dividend to its shareholders. To your point. Again, thats the latest news from dan loeb of third point. Well see what sony has to say. Again, this is not a letter directly to sony, as the other two letters have been. This just a regular quarterly letter to third points investors. But in it, after the first couple of letters to sony seemed to take a bit of a cordial type of approach to this whole thing, this is more pointed criticism of sony entertainment, at least third points own investors. An interesting story. Yeah. Were watching the markets, and in just a moment, one expert says the dow is heading for a course reversal that could send it down to 5,000. Bob pisani, the dow is down about 31 points right now, so were not going all the way there. What are you hearing from traders on the floor . Reporter did i hear this right . 5,000 . Is that right . Thats correct. Reporter theres no sign its happening today, good news. Thats a 70 drop. Im sorry to laugh. But theres no way its this looks like friday, we had the de 5,000, im trying to get my head around this. Put up the full screen. The last time we were at 5,000, it was 1995. Guys, that was the real estate reporter back then. I had brown hair in 1995 i dont know where the s p was. Probably 500 and we probably had 35 or so, we printed that year in earnings. This year, well do 103 in the s p. So were talking about, you know, a third of what we are of where were at right now. I dont think well be there for a while. Today, you know what . Look at the dividend stocks. Telecom, utilities after a horrible six weeks, making a little bit of a comeback today. Elsewhere, i would note the problems in japan, four down days, 8 declines, yen stronger. A little bit of a hiccup in abe land over there, the japanese stocks that trade here at the new york stock exchange, weak again today. Id like to hear the reasons why were going to go to 5,000. I have a hard time with that one. Yeah, bob, we do, as well. Im sure all of our viewers do, too. Well get some answers right now, in fact. The dow and the s p, bob sang, arent fall from the alltime high, but our next guest, as bob said, is calling for dow 5,000 before we see 20,000. Whats behind that cause . Terry burnham joins us now, from acadia asset management. And also michael with the inflation rotation fund. Terry, we have to start with you. Thats a 75 drop from where we are right now. What do you think will contribute to that . Right, well, thanks for having me on. I really wanted to go on the record with this crazy call, as bob said, it seems extremely unlikely. And yet i believe weve already begun what will be a wall of pain for most investors. In i can just take a moment to say, even though i believe theres a tremendous amount of economic pain coming, ive got three little girls, im an optimist overall, they love cnbc, were optimistic things will go well, but we have a lot of pain coming along, and if youll give me a moment, ill lay out the economics and psychological reasons for that. Go ahead and give us a quick rundown give us the main reason. Give us the main reason, terry. I mean, what in the world is going to take the dow from 15,500 to 5,000 . Yes. The main reason is that were broke and were following the wrong policies. So the average american saves almost nothing and has 100,000 saved. So that means that 2 , 3 , 4 Interest Rates, wherever we go, they live on a few thousand dollars a year. What has to happen . They have to save more. We have to take that pain, and what weve done on a policy front is exactly the opposite. Weve tried to encourage people to continue to overconsume, and all thats done is made the problem bigger, and it shifted the problem from the people who ought to be bearing the pain to the people who ought not be bearing the pain. There seems to be a little bit of a behavioral shift in washington. Im not going to give them too much credit. Michael, we are getting headlines this afternoon that treasury is reducing its borrowing needs, 209 billion is what theyre going to start borrowing Going Forward. We heard from tim geithner that there was a way that treasury could respond to some of the structural budget issues in washington, and were starting to see some of the first glimpses of that. Why do you think maybe we are going to stay where we are, or what sort of issues do you see with terrys argument here . I think the mayans had a crazy call, too, and we found out they were wrong, and you have to be aware of the apocalyptic scenarios. You can have deflationary shock, and central bank paranoia is a good ammunition to prevent that from happening and you talk about the behavior. The instinct of every federal reservist is to keep chairman and an institution as a job. If you go down to 5,000, i find it hard to believe any central bank will be in existence. And also in the midst of an equity bubble. If you have every single Retail Investor in the market, and clearly were nowhere near that. So as much as it may sound like extreme, i think you have to really be careful about assuming that you will see such a setup, and if you are going to see dow 5,000, i hope im told when so i can leave the country. Yeah, terry, do you want to respond to that . It seems like such an outlier call to the point where i wonder even about the credibility of it, just when you make such a huge call saying that the markets going to go from 15,500 down to 5,000, people sort of roll their eyes thinking that its crazy. Yes. So it sounds crazy, and everyone always wants an economist who will stick their neck out. So im doing that. And i want people to remember it sounds crazy now, because it wont sound crazy in the future, i i this. So thats why i really appreciate the opportunity to come here. Now, whats interesting about markets is that people believe crazy things at tops. Remember when we believed housing prices couldnt go down, when we believed gold was the safest investment, 2011, 2012, gold was the safest investment. And here, what we believe thats absolutely crazy is the central bank can make us richer. If loose money could make us rich, zimbabwe would be an economic powerhouse. So we all know that thats not true, and yet, at market extremes we believe things that are absolutely false. And so, i embrace the, you know, the idea that this is crazy, and in the nottoodistant future, i believe that we will change our minds. Terry thats what go ahead, kayla. Well, im just wondering, it is a bold call. Im glad that you are talking about whats behind it. Are you putting money behind this call . Are you actually investing in line with this thesis . Or is this just a recommendation that youre putting out to the market . Yes, so in the leadin, it said i am acadia im no longer at acadia. Im a College Professor at chapman university. With my personal money, im invested along with these beliefs. And i think things get worse than that, which is to quote argo, no Good Alternatives. The least Good Alternative is cash, and even that will be risky in the future if Financial Institutions fail. Michael, the last word. A quick point, talking about dow 5,000, a highly funded, youre talking about the end of the capitalism system. If you are going to bet on that, we have more important things to worry about, as you might want to live abroad. Everything youre betting becomes worthless under the end of the world scenario. Yes, i dont agree. The dow went down 90 in the depression and we didnt have the end of capitalism. We didnt have much leverage anywhere near that kind of leverage in the 30s. Yes, so you terry, when you were at goldman sachs, were you a contrarian trader there or what . I was only there i was only there for a short time. I was in the bond area. So, yeah, ive been a contrarian, i think. All right. Terry burnham, michael. Thanks. Thank you. All right. 35 minutes to go before the bell rings. The dow is hanging on to a loss of almost 38 points. The s p, nasdaq negative, as well. Up next, we were talking starbucks. Will it perk up your portfolio or get you in hot water . And herbalife reporting earnings after the bell. Its a true battleground stock, and well have the instant analysis and reaction, including from resident herbalife skeptic herb greenberg. I feel like he just comes out of the woodwork when they report earnings. And then, some people wont let the federal government breathing down your neck ruin a good party. Embattled hedge fund giant steve cohen had a bash this weekend raising ire and eyebrows. More on that ahead. [ male announcer ] its time. Time to have new experiences with a familiar keyboard. To update our status without opening an app. To have all our messages in one place. To browse. And share. Faster than ever. Its time to do everything better than before. The new blackberry q10. Its time. Welcome back. Shares of starbucks trading at alltime highs a of the giant Coffee Company raised its earnings. Its adding charges stations to a number of locations in the Silicon Valley area. Is now the time to buy . On the technicals, richard ross, and on the fundamentals, we have brian bentner of oppenheimer. Brian, starbucks beat earnings, raised fullyear guidance and introduced some new concepts, and is that enough to make you a buyer . Weve been recommending starbucks for quite a long time. Its had a terrific run representing the awesome business fundamentals. But we do still like it here. Its really threefold. Number one, we think the street really underestimates the improving sales trend. I think when you look at the food thats going to be coming into starbucks stores, its not fully representative in estimates out there. Number two, look at coffee. I would say, you know, to the viewers, look at the coffee chart over the last 18 months. Its really divebombed. Thats going to drive margin expansion, and i think it will drive visibility in some of the best eps growth in restaurants. Number three, i think theres a Balance Sheet catalyst coming. I think this is an underutilized Balance Sheet. I think they can lever up, potentially buy back a lot of stock, or really up the dividend ratio payout ratio. So while its had a great run, i still think theres room to grow. All right. Balance sheet aside, youre looking at a stock in 2009 was below 10 a share. And now at 72. At what point, does the chart get out of hand and what are you reading out of it now in. The technicals buttress brians bullish belief here on starbucks. Theres significant upside from current levels. When you bring up the shortterm, oneyear chart, you dont have to be a Technical Strategist to see why you like this stock. Youre up 63 just in this welldefined trend channel asloan. We get a fresh gap off to an alltime high. But what i really love about this stock is the longerterm weekly. That suggests theres much more upside. You see on this threeyear weekly, last year a 30 bear market decline within the context of the secular bull trend. Beautiful textbook doublebottom, break out above 60. We see measured upside to 80 a share. Wed still be a buyer right here. All right. Beautiful textbook bottom. I think we will leave it right there, gentlemen. Richard, brian, thank you for being with us. You guys both agree its a buy. Scott . All right. Stocks are lower 30 minutes or so before the bell rings. Certainly an interesting deal in the market. A lot of them today, including huge merger in the advertising industry, plus hudson bays 2. 9 billion purchase of saks. Whats behind the activity, and you may be surprised and whether a lot more could be coming soon. And snapchat. Mostly teenagers use the self use the selfdestructing messaging app. But it could be catching on with traders. 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A busy day, and Julia Boorstin has been tracking the deals. She joins us now. Reporter thats right, kayla. And this merger monday, three mega deals were announced. The second and Third Largest ad agencies merging to combine a new ad behemoth, thats pub lickis and omnicom to combine their revenue, nearly a third of all of the major ad agencies revenue. If it gains regulatory approval, the company is expected to use its scale and data to negotiate better terms and better compete for digital ads which are expected to go to 27 of all ad spending by 2017. Theres also a big deal in the Luxury Retail space. Canadas Biggest Department store chain, Hudsons Bay Company is buying Luxury Retailer saks for about 2. 4 billion. The deal will create a Department Store giant with three chains, saks, lord taylor and hudsons bay, and 320 stores in some of the biggest cities in the u. S. And canada. Now, the retailer plans to expand saks footprint, especially up north. And, also, a mega pharmaceutical merger today. U. S. Based perrigo, which makes overthecounter medicines, is paying 8. 6 billion for irish drug company elan. It will allow a much lower tax rate as well as a platform for international expansion. Now, kayla, well have to see what kind of fallout we get from the mega deals. We could see players in each of the three categories advertising retail and pharmaceuticals start to snap up some of the Smaller Companies so they can compete with these new mega merger companies. Back over to you. All right, julia, thanks. Out in l. A. Whats next on the m a horizon . With us now to discuss that is roger altman, the chairman of ever core partners. Roger, thank you for being with us. Welcome to closing bell. Nice to see you. What do you think were going to see in the back half of the year in terms of m a . I spoke with a Bank Executive last week who said the animal spirits are still there, they just need to be unleashed. It seems that at least today is a sign that were moving in that direction. Well, if you look at the data for the first six months, merger Market Conditions are right in the middle. Theyre not hot and theyre not cold. You had announced mergers globally in dollars, slightly down for the first six months, 2013 over 2012. You have the u. S. Piece of that, just u. S. Deals, up rather nicely for that same period. So the rest of the world was especially weak. But my point is that merger Market Conditions are fine. Are they are they white hot . No. But are they poor . No, theyre not poor either. Its good to see these three deals, because they indicate strength in the market. But were really in the middle, and thats not a bad place to be, because from our point of view at evercore, business is really quite healthy. You know, roger, i wonder, though, as you see so many stocks near their 52week highs or either setting new 52week highs, plus an economy thats still fragile, whether theres little upside for a ceo to do a deal. Maybe hes worried he or she is worried about what will happen with the economy, and whats the upside for a stock thats already near a new or alltime high . Well, scott, i think it works the opposite. Not that way, but the opposite. In the following sense. While you might think that buyers should wait for prices to be low and pass up opportunities when prices are high, its usually the reverse of that. When stock prices are high, confidence follows it, confidence is high, Decision Makers think externally rather than focusing inwardly, and deals historically rise. The volume of deals rises. So you take that, and you take the likelihood that the u. S. Economy over the next three years 14 through 16 as ben bernanke said in his now somewhat famous press conference of three, four weeks ago, is going to be quite a bit stronger. He talked about 3. 5 real growth for next year, and Unemployment Rate coming down to the 6. 7 to 6. 5 range by the end of the year. That would be a strong year. If you believe that, which i do, and you think 2015 and 2016 will be like it, which i do, then you have a combination of good confidence arising from high stock prices, a sense that Business Conditions are about to improve quite a bit, and that makes for good merger activity, and i think the environment is rather improving for mergers, even though, as i said in the beginning, theyre really in the middle now. Right. Well, roger, you look at some of these stocks at their 52week highs, and you also would think, okay, if im a target company, im not going to feel comfortable selling at a point where my stock is below that 52week high. You want to do right by your shareholders. If im acquiring company and i have cash to burn and im seeing the economy get bheter and my Profit Margins are as good as theyve been, why would i not make the decision to increase my Capital Expenditures . Hire more people, when layoffs are finally stopping, but hiring hasnt necessarily picked up. Where is that full crumb between hiring and doing deals, and should companies not be hiring before theyre spending billions of dollars to buy out their competitor . Well, of course, its ultimately a mixture of both. Internal investment and hiring on the one hand, and inorganic moves like acquisitions on the other. Now, businesses are hiring, although not at a strong pace. I mean, the average monthly job increase figure has gone up this year. So hiring is improving, but not very fast. And capital spending, in my view, is healthy. But again, not white hot. But in terms of acquisitions, a couple of points. First, a lot of acquisitions, of course, are driven bin y synerg, and secondly, in this market, share prices are typically going up that is, buyer share prices upon announced acquisitions. So in this market, most announcements are accompanied by an increase in the buyers share price, meaning that investors in general are liking mergers these days. So thats an extra incentive to do them. But ultimately, its some of each. Well, roger, were certainly going to keep you on, keep you coming on, to keep discussing this trend as it goes forward. Hopefully, well see some whitehot hiring and whitehot deals, too. Roger altman from evercore, thank you for being with us. Thanks a lot. 20 minutes to go before this monday on the street wraps up. The dow is pretty much hanging out where its been, down 26 points. The nasdaq is off 9. The s p 500 down just about 5. Snapchat is a way to share a moment on the iphone without allowing the recipient to share it with anyone else. The message supposedly selfdestructs in seconds, but should it be used on trading floors, or will it be a tool for Insider Trading of information . And after the bell millions of americans are possibly just more than an hour away now from being a casualty of the war between cbs and time warner cable. Details of that squabble are coming up. announcer scottrade knows our clients trade and invest their own way. With scottrades smart text, i can quickly understand my charts, and spend more time trading. Their quick trade bar lets my account follow me online so i can react in realtime. Plus, my local scottrade office is there to help. Because they know i dont trade like everybody. I trade like me. Im with scottrade. announcer scottrade. Voted best Investment Services company. Otherworldly things. But there are some things ive never seen before. This ge jet engine can understand 5,000 data samples per second. Which is good for business. Because planes use less fuel, spend less time on the ground and more time in the air. Suddenly, faraway places dont seem so. Far away. Welcome back. Snapchat, if youre not aware, is a mobile messaging app thats gaining popularity, sweeping college campuses, and it allows people to send messages, pictures, video, and only allow them to be viewed by a few people for a few seconds before the message is hidden forever and erased from the snapchat server. Apparently. But who else is using the app . Wall street. Thats making some worried when asked about regulating the selfdestructing app. Wall streets top cop had this reaction. Can the bad guy snapchat buy wireless at 3 45 and get away with it because you dont have the technology to stop it . I dont know what youre talking about. So is it possible that wall street is trading insider secrets with that app . We take it down to the traders to find out. Cnbc market analyst kenny is here now. And snapchat expert. You know what snapchat is . You do i do know what it is. I had to call my two kids and have this conversation about im not a snapchat user, because as i understand, nothing really good happens on snapchat, because its a picture you dont want anyone to see, you want to disappear after five seconds. Maybe you do want some people to see it for such a short period of time and thats what could you possibly want someone to see for three seconds and then hope it disappears forever . So thats question number one. So when you talk about wall street i think probably the stuff that they would like to be posting on their facebook or instagram pages but they know those get searched and those are more readily publicly available. So its a picture you dont want anyone to see, right . If it was something you wanted someone to see, what difference does it make . Which is probably okay. People want to send something they dont want people to see, but therefore, it lends itself to exactly what were talking about. Do they have this ability to take a snapchat of some Research Report or some recommendation thats not yet public that might be going out and send out, thats the question. Why wouldnt they . I mean, they apparently would have that ability right. It would disappear maybe 10 seconds after you or or joe public opened it. Right. Thats an issue, right . Thats absolutely an issue, and they shouldnt do it, because clearly its illegal. Its Insider Trading. Clearly, the regulations say its illegal. But yet, how do they regulate snapchat when Preet Bharara didnt know what it was. He wassi maybe being tongue cheek. We should maybe give him a little more there was more after that one sound bite. He said Law Enforcement has evolved. We dont look at emails you know, in the s. A. C. Case, its front and center. The other interesting thing, kenny, jim asked about, do you send someone snapchat at 3 45, s it doesnt seem to work that way. Its a little more fuzzy. Theres a lot that can happen. Right. Theres a lot that can happen. Until theyre able to regulate it, maybe youll see Compliance Department say, listen, no more personal cell phones on the trading desk or in this area lets put it this way, as far as you guys know, correct me if im wrong, you guys arent allowed to have cell phones Walking Around the floor. You cant have a cell phone Walking Around the floor. No one is supposed to be on a cell phone, that is, other than issued, Walking Around the floor on a cell phone, guests or otherwise. You walk around with electronic tablets. The tablets are new york stock exchange, those are execution devices. Those dont communicate anything but orders. And we have no proof its going on, but its been opened up to discussion. Yeah, and theres probably a lot more to talk about. Right. Kenny, thank you. There are how much time do we have left . 10 minutes to go before the bell rings. The dow is still down 28. Down day, modestly so, on this monday. A big show for you next. Dont sign up for another free trial until you hear this report from sharon epperson. Why millions of those free trials are anything but free. Billions of hidden charges. Its a fascinating story. Yes, were keeping an eye out for herbalife. The big Earnings Report is after the bell. Well have instant analysis. The analysis you need right here on that incredibly controversial stock. Golden opportunity sales event and choose from one of five lexus hybrids thats right for you, including the lexus es and ct hybrids. This is the pursuit of perfection. Oh, just diagramming this accident with my state farm pocket agent app. You can also get a quote and pay your premium with this thing. I thought state farm didnt have all those apps . Where did you hear that . The internet. And you believed it . Yeah. They cant put anything on the internet that isnt true. Where did you hear that . [ both ] the internet. Oh look. Here comes my date. I met him on the internet. Hes a french model. Uh, bonjour. [ male announcer ] state farm. More mobile than ever. Get to a better state. With fidelitys options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens, and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. To experience the precision handling of the lexus performance vehicles, including the gs and allnew is. This is the pursuit of perfection. Go. Welcome back. Modest losses across the board to start what is a very busy week on wall street. With us now, Mark Spellman from value line funds, and Michael Crofton from philadelphia trust company. Michael, mark, welcome. Good to have you both be with us. Good to be here. I said its an incredibly busy week given on whats on tap between the fed, ecb, gdp, you name it, earnings. How do you size up the market here in. The market is priced where it should be. I think earnings are coming in mixed. You really cant measure earnings this time, because theres so many stocks bought back, reducing the share count. Revenues are okay. Some better, some worse. I think the market is in a real good spot. What i like about the market is Consumer Confidence is strong and remains strong, and i think Consumer Confidence can power this to the next level. Mark, where do you fall . Some say its overbought. Some like michael say its at a good point. Where are you . Im finding different pockets of value. I think because rates are higher, the sectors that are going to work Going Forward are going to change. So the sectors that rely on investment dollars that are competing with fixed income instruments are going to underperform, and namely the reits and utilities. And other areas, were seeing some really interesting growth i think the earnings so far have been pretty good, much better than expected in many groups. And youre going to see income stocks that not necessarily are the highestpaying income, but ones that are growing dividends. I think theyre going to be the ones outperforming Going Forward. Such as whom . What areas of the market do you like right now then . Sure. Specifically. Specifically . I think were underweighted in tech for quite a number of months. Were wanting to see some of the prints hit. I think some of the tech names are starting to get interesting. I see emc. Theyll buy back stock in the next few months. They initiated a dividend. Some of the tech names are getting interesting. I love the tech. I love emc. I love if f5. Youve been hearing that for a long time. People have been picking tech stocks for the last several months. Stay with them. They havent delivered. Look at microsoft. Microsoft has been terrible. Im with you on that one. Microsoft. I think a lot of people have been trumpeting tech, wrongly so. Some tech some tech you have to be selective is starting to deliver. I dont like Consumer Staples or discretionary. Theyve outrun their ability to generate the earnings necessary to justify the stock prices, and people are going to get burned in those stocks if they hold them much longer. All right. Gentlemen you have a last point . You look for the tech names going through the transitions. Product transitions, software transitions. Those are the ones. I would add s. A. P. To that. Its been a lousy stock, but however, a lot of products are coming out in the next couple of months where the earning also get going and i think the multiple will start expanding. You like s. A. P. , say over an oracle or yes. You do . Yes. Speaking of a stock thats disappointed. I like oracle. You do. They dont give you much to like . No, but i bought it on the cheap. I think well be well rewarded. Looks like mark will let you keep orange countying ale. All right. Up next, the closing countdown. After the bell, if youre a time washer subscriber, youre about an hour away now from losing access to cbs and showtime, unless a deal in the 11th hour can be made. Well have the latest on those excruciating negotiations when we come back. Hey linda what are you guys doing . Having some fiber with new phillips fiber good gummies. Theyre fruity delicious just two gummies have 4 grams of fiber to help support regularity i want some. [ woman ] hop on over [ marge ] fiber the fun way, from phillips. [ woman ] hop on over theyre the days to take care of business. When possibilities become reality. With centurylink as your trusted partner, our visionary Cloud Infrastructure and Global Broadband network free you to focus on what matters. With Custom Communications solutions and responsive, dedicated support, we constantly evolve to meet your needs. Every day of the week. Centurylink® your link to whats next. [ cows moo ] [ sizzling ] more rain. [ thunder rumbles ] [ male announcer ] when the world moves. Futures move first. Learn futures from experienced pros with dedicated chats and daily live webinars. And trade with papermoney to testdrive the market. All on thinkorswim. From td ameritrade. Welcome back to the floor of the new york stock exchange. Its time for nor the closing countdown. Im going to show you what is no doubt the stock of the day. That is cf industries. This stock just shot higher ever since we first revealed about an hour ago that dan loebs third point had taken a stake in this company, a position in cf industries. Theres a look at it. Up more than 11 on that news. 201 and change for shares of cf industries. If youre wondering whats leading the dow by the way, thats the best performing stock in the s p 500. The best performing stock out of the dow, caterpillar. Accelerating its buyback. The stock is getting a boost, as well. Again, the beginning of what is an incredibly busy week, michael. What will you be looking out for most . Im going to be watching the fed very closely this week. I think if we can get the fed to give us more clarity on what their intentions are, this market can begin to make new highs. The market is really poised to do better. Earnings have been good generally. You know, some have missed. For the most part, revenues are okay, in line. Companies have done a great job cleaning up the Balance Sheets, Getting Technology into their businesses, eliminating, you know, overredundancies in the business models. So i think the market is poised to look much, much bet erk as long as Interest Rates remain contained and Consumer Confidence remains high, well be fine. Give me the best Case Scenario of what the fed could say if youre a bull in this market. What the fed could say is that they are seeing growth in the economy and that if they see enough growth theyll begin to take the foot off the pedal. So taper is okay. I think taper is okay as long as we have the growth to sustain the market. The markets priced in a lot of gdp growth already. Its priced in maybe 3. 5 , 4 . If the fed says they see the growth acceleration, i think they can taper and the market will get right through it. I dont know if the markets priced 3. 5 to 4 i think it has. It has that sounds optimistic considering we are due a lousy print for the second quarter. It is optimistic. Thats where Consumer Confidence comes in. The consumer is seeing well beyond where we are now. And even corporations. Look at the mergers today. The advertising companies. They wouldnt dou that they didnt see the growth. The best area to be in now. We talked about technology. What else do you like . I like industrials. I think industrials are poised to do extremely well given the low Interest Rate environment, given theres a lot of pentup demand thats been satiated. I like industrials, tech, energy, particular domestic energy, gas, things of that nature. Industrial earnings were one of the bright spots if not the brightest spot so far. Banks have done obviously financials are doing great. Financials have done well. Ge has done well, utx, honeywell. I like utx, 3m, a whole bunch of industrials in the portfolio doing great. We love financials. A lot of financials in the portfolio. We had to suffer with them earlier, but theyre doing well now. All right, michael, good to see you. Thank you. Michael crofton, philadelphia trust company, president and ceo. 20 seconds before the bell. Its a down day, but again, you have such a busy week. The market seems to be taking a waitandsee approach. Kayla and i will have that plus big earnings coming. Herbalife is moments away. [ bell ringing ] its 4 00 on wall street. Welcome to the closing bell. Im kayla along with scott wapner. Maria bartiromo will be back tomorrow. We had negative housing data this morning and the dow has been down ever since the open. Closing just down 35 points. Nasdaq down just about 14. And the s p ending down 6. But still a good july overall. The markets tried to fight back. We have bob pisani to walk us all through what exactly happened in the market today, toward the end, bob, they went down, they went up, couldnt quite get there, could they . Reporter no, ll