Transcripts For CNBC Closing Bell 20140710

Were still off 82 points. Its been a rough week across the board, especially for other indexes were not showing here. The russell 2000 having one of its worst weeks in some time. So, this all comes, of course, on the back of some selling weve already had this week. Its not just about the action today. The last hours going to be critical here to see whether we can stay off the lows of the day or if we head back to those lows. Theres the russell. Yeah, off 1 today. Meanwhile, lets look at some of the other markets. The nasdaq off 0. 6 . There it is. And 4,393 is the level, off 12 points. The dow is off 81, thats 0. 5 , 16,904. And off nine points. Joining our closing bell exchange, doug cote, jim lowell, charlie blel, Quincy Krosby from prudential and we have Michelle Carusocabrera and rick santelli. Michelle, when we all got up this morning, things looked bleak. There were concerns about this big Portuguese Bank, but now things look like theyre settling down a little bit. What was the story . Yeah, so the story is, theres a very large bank named after the espididusanto family. And a holder of the bank was starting to get into trouble and it looks like its starting to have some impact on the underlying bank. It led to a huge selloff in the shares of the bank, the shares of the portuguese index. And here was the big question that the market was asking whats going on with this bank . Is this an isolated situation or is this once again symptomatic of something more widespread in the european financial and Banking System . In other words, are we going back to some kind of crisis situation . As the day has gone on, the bank of portugal has come out and said the bank has recently raised capital, we believe it is solvent, and weve also gotten to know more about the relationship of the bank with the holding company. Theres questions about governance, et cetera. We should also highlight that the bank in particular that were talking about actually had a runin with u. S. Officials back in 2012. I have here a cease and desist order from the Federal Reserve of the United States telling them to stop doing certain kinds of businesses that they were doing with Money Transfer company in newark, new jersey. So, once again, worried about something wider, now theyre thinking maybe this is isolated to this one particular bank. That may be why the markets have come off the bottom. Maybe they were selling first and asking questions later. Jim lowell, even if this is either the end of a european carry trade or the beginning of some further concern that could play out for several weeks time here as the imf and other people try to get their arms around the liquidity situation in portugal, what is a u. S. Investor to do here . How much more selling pressure could there be, again, even if the bulk of it comes during those hours when europe is open . Statistically speaking, were way overdue for some setback in the markets, not just overseas, but domestically as well. That said, what we saw this morning was dramatic, not traumatic. We think it is not an indication of systemic risk, although we fully expect as europe takes a turn towards hopefully sustained recovery, but there are going to be oneoff instances that create these kinds of runs on the market, if not outright banks. That is likely good news for longterm investors, especially if theyre in a good, diversified, eurocentric fund, Fidelity International discovery is one that we use. We continue to think that days like this create very good buying opportunities for a seasoned manager, rather than a reason to exit the room. Rick, let me bring you in now. I mean, weve seen this movie before. Here we go again, a foreign bank, weve got some problems. Were wondering how pervasive it is. As michelle pointed out, is it isolated . Is it systemic . Whatd you think of the market response today and whats going on right now . I think it makes absolute sense. I think the u. S. Equity market should be a bit nervous, but it shouldnt be totally the reason for any type of correction. I think whenever you have insolvency in a backandforth with people discussing a european bank, thats never good. I dont think its the beginning of a crisis. I dont think its the end. I think its ongoing. I think stabilization is not synonymous with fixing what ails europe. And i think the Banking System with manipulated rates in the southern economies arent real. Its not really tradable. It doesnt really affect riskreward, and i think sooner or later, those values will resurface and its going to make the eurozone a very economic, soft area outside of germany, in my opinion, for many, many quarters to come. And i think thats a reality that the market has to deal with in the u. S. And that, rick, do you think that impact will play through to a stronger u. S. Dollar . You know, i think when it comes to the euro versus the dollar, the dollaryen, or the pound, i dont think youre going to gain any knowledge. Once again, i think all those economies are playing central banking games, and i dont know that i could look at an fx market and give you a reality when we have a Portuguese Bank where were questioning its solvency and the euro has a 1. 36 handle. Right, right. Wheres the reality there . So, i think that if you really want a reality with foreign exchange, youre going to have to kind of look outside the big, developed economies. Doug cote, what do you make of the afternoon session here . I mean, obviously, lots of selling this morning. Weve come back, but now were drifting lower again here. What are you watching carefully . Well, you have to keep in mind, we have a broadening economic expansion going on. You look at emerging markets as of yesterday, actually passed the s p 500. So, i would be advising investors to broaden out the portfolio and to more globally, also in bonds and take on credit. But i think just yesterday, janet yellen was affirming in the minutes that the u. S. Economy is fine. It looks like the biggest problem is going to be when we raise rates, theyre going to end qe by october. Rates will start going up. Thats an affirmation that the u. S. Economy is fine, but also, the Global Economy is okay. So, i think the markets are very resilient and can withstand this. Charlie, do you guys share that view . What trades are you putting on here . No, were looking past todays action and taking a deeper look. And what were seeing is the conditions are worsening in general. So, what were seeing this year is classic cycle behavior. Energy, materials, utility sectors leading the market higher, while Consumer Discretionary and financials are lagging. Youre also seeing weakness in homebuilders and strength in the treasury market. Now, at the same time, youre seeing Investor Sentiment at extremes that we havent seen in years, while the average stock this year is reflected by the russell 2000, is flat on the year through six months. Now, any one of these signals individually would be you could dismiss, but together, we think its going to lead to a more difficult environment going forward, and it tends just one question to clarify this, because what you and doug just said sounds like its at odds, but maybe it isnt necessarily. Is this scenario consistent with an economy that could be gathering steam . So, with we seeing a shift in Investment Opportunities that are out there or do you think this is it and the best days of the u. S. Economy are behind us . I think you need to look past lagging indicators like the payroll report and the unemployment data and look to leading indicators like the bond market. And something is wrong when you have longduration yields declining for the entire year and the yield curve narrowing. Its telling you, looking forward, theres going to be weakness. Now, we have defensive areas of the market, like treasuries and utilities widely outpacing the s p 500. Most investors are just looking at the s p and saying things are still looking good and i can get out in a few months when qe ends. But if we look at 20102011, you saw sharp corrections after the end of qe. Will investors really wait until qe ends . We dont think so. And we think theyre already rotating out into defensive areas, if you look at small caps and you look at other momentum names. Theyre already getting out of higher beta names and intersdiv areas. Quincy, where do you understand . You have to admit the market is skittish, kind of scared of its own shadow here after we hit 17,000 on the dow, and it happens as the fed is slowly, gradually pulling back on its quantitative easing. What do you think the markets going through right now . Absolutely, but one thing and keep looking at that treasury market as our guide the fact is that money is coming into the u. S. Treasury market, the yields are better here. Today was a perfect example, and it does push those yields down. We saw when the numbers came out, you know, on payroll, for example, the twoyear moved up higher, acknowledging that growth is picking up and gaining some momentum. But that said, were going into a treacherous period for the market in terms of seasonality. Its going to be difficult. And we have got to watch the earnings. As the fed gets away if we dont see Topline Revenue growth picking up, this market is going to say the valuations are not commensurate with where were seeing Companies Getting their growth. And that, weve got to get through that. And i think this market will go yea or nay as we go into the earnings season in depth next week. Oh, yes. Oh, by the way, earnings. Yeah, oh, by the way. Havent even gotten to that with portugal in the way. Tomorrows going to be a big day for all of that. Well leave it there. Thank you. Thank you all. 50 minutes to go and the dows off 90 points, the nasdaq down 7. The russell, the index of small cap stocks feeling the most pain of the major averages, swooning to its worst weekly decline in over two years. Were going to speak with the small cap watchers themselves to find out if theyre ready to buy here, or is it time to bail on the small cap . Also ahead, wall street veteran Dennis Gartman saying hes making money today. We wanted to know what hes investing in, and hell reveal all of that, just ahead. Yeah, ill have what hes having. Later, diana olick has a special report on why suddenly people cannot afford homes and how that may be dragging the economy and the market lower. Stay tuned. In india we have 400 Million People who dont have electricity and i just figured that its time i do something about it. What were doing right now, along with ibm, is to actually transfer data through a satellite from our wind farms directly onto the cloud. I think we could create a far more efficient system across the whole network where we could actually draw down different kinds of energy based on when its needed by the consumer. A smarter Energy System is made with the ibm cloud. Another down day for stocks, a lot worse earlier. What did i see the other day . Our Research Staff said that july so far had been one of the most volatile months weve seen in quite a long time. When you think about it which probably tells you more about the market than it does about what weve seen in july. But yes, the actual volatility, the swings in this market, and its only what, the seventh, eighth day . I dont even know, the tenth day in july . It was down 180 this morning, now down 84. Yeah, its no longer around for the markets, but it is close in small cap stocks and certainly has been around for the last couple of days. Seema mody is keeping an eye on all of this. How do things look on the russell today . Small cap index still underperforming the major indices, and experts tell me whenever there is heightened risk in the market as well as concerns about the future outlook of the broader economy, small caps tend to underperform, and thats exactly what weve been seeing over the past couple of days. A rough week for the russell 2000. In fact, the worst week in over two years. Now, our Research Shows that about 39 of the stocks in the russell 2000 index are trading in bear market territory or 20 below their respective highs. But youve got to put this into perspective. Weve seen this picture before, in march as well as april. Small caps sold off, but it then staged a major comeback in may and june. So, thats something to keep in mind. Btig recently wrote that the question is whether the small caps are telling us something that the large caps are not. And you know, other analysts i spoke to say, hey, that makes sense given that the russell 2000 does house a lot of domestically oriented names. Is the selloff in the Small Cap Index telling us something about the broader economy and markets . Kelly and bill. All right, seema. Thank you very much. With us now to kind of dig through the small cap space and see whether its time to buy something or maybe take a pause here, laurie calvasini from Credit Suisse and tom salimoni with schaeffers investment research. Laurie, what do you think in the russell itself had been a leader to the upside until recently. So, obviously, the volatility is still here. Is the small cap reign over for a while or should you be buying some of these dips here . You know, i wouldnt buy the dip yet here. We have the exact same problem here right now that we did to start the year, which is that overall, the valuations in the space still look terrible. And so, i would wait. And yet, let me ask you, is it a valuation story when youre gauging entry points, exit points here, or is it more of a carry story, of a momentum play, in other words . You know, i think the momentum can carry you in the shortterm, but the valuations will come back and bite you in the end. Weve been consistently trading this year at 18, 19 time on a forward pe multiple, and historically, when youre in that range, youre only up single digits, youre down single digits. You really dont gain much traction from here. What do you think, todd, are you looking for bargains here . Oh, sure. Weve liked small caps, weve liked small caps for years. But we also like the broader market. And you know, if were bullish on the broader market, we do think the small caps are going to show leadership and will continue to show leadership. Essentially, bill, theres just been a lot of caution in this market. Right. And i really think, we truly think this caution is breeding the low volatility environment, even though a lot of people are saying this low volatilitys a sign of complacency. We dont see it. Were seeing a lot of people either move to the sidelines because theyre afraid of the low volatility or they are buying portfolio protection. So, when you get headlines like this, the knee jerk reaction is to sell, but theres not this panic selling that occurs, because again, either people are on the sidelines or theyve got that portfolio protection and theres less need to panic. Im just thinking back to the spring when there was a similar selloff in the small caps when the markets were looking a little bit weak, and we had dan greenhouse on the show, and he memorably said, no, this isnt going to go any deeper, its time to get exposure. And that time around, he was right. So, lori, did you think the same thing about the small caps last time around . Is there Something Different about the nature of the selloff this time that has you more concerned . You know, weve been cautious all year. And to be honest, whats really different right now versus a few months ago is that back in march, we still had a very favorable money flow environment. Retail investors were still putting money into the space, and weve seen over the last few months thats not true. Retail investors are pulling out of small cap core funds, out of small cap growth funds, so i think youve lost that money flow cushion here. Todd, looking at your notes here, youre looking at some levels of resistance. I guess this is for the russell, but yet, youre still buying here. Bh what are you buying . Give us an example of what you like here that you feel still represents some value in the small cap sector. Well, bill, its just within the small caps, our general approach is to look for those stocks that are displaying strong price action, but were seeing evidence of skepticism. Whether thats looking at analysts buyholdaccelerateings or looking at Short Interest levels. Two names that come to mind, century aluminum and Chesapeake Lodging trust. Century aluminum, on the heels of that alcoa positive earnings reaction, in century aluminum itself, this is a stock thats more than doubled off its 52week low, yet theres high Short Interest. And of the eight analysts that cover it, only two buy ratings. So, youve got this stock thats up 60 year to date, yet strong upgrade potential, strong Short Covering potential, and again, on the heels of that positive earnings reaction from peer alcoa. Lori, are there any names you guys like here, or at what point are you looking to get back involved or recommending this space . I mean, how much further do small caps have to go before they make fundamental sense to you . Well, id like to see the forward pe on the broader Small Cap Index hit kind of 15, 16 times, along with the longerterm averages. Wow and were quite a ways from there yet. I will say that you can always find pockets of opportunity in this space. And one place right now that we think is interest is the Speciality Retail space, which is a space that has gotten pretty beaten up so far this year and looks actually pretty undervalued versus the russell 2000 right now. The problem is, there just arent a lot of those out there right now. Exactly. And i was just going to ask if you know off hand what the multiple is for the russell 2000 right now . Weve been trading at 18, 19 times. If you looked at the end of june, for example, we were up around 19 times. Okay, all right. Well, its not terribly far to go, then, down to 14, 15. A ways to go. Thank you both. Appreciate it very much. I checked with our Research Staff and they got back to me. It was that july, typically in the last 20 years, has been the most volatile month of the year. Hmm. Maybe because of the lighter volume and people going on vacation. But whatever it is, it has typically in the last 20 years been the most volatile month. And it has been so far this year, too. And you still know its a market in search of explanation when people are talking about moon and lunar cycles as one possible catalyst. Yes. Here we go again. 40 minutes to go as the dow is off 82. As bill mentioned, the nasdaqs off 9. Pressure is echoing the trading activity overnight. Next, an insiders view of the economy when wd40s ceo sheds light on the lubricator makers disappointing earnings and if he sees consumers wallets sticking shut like lumber liquidator. That stock has been on a tear for years and now is down 8 . And if theres a real pullback, do you have your stock Shopping List ready . If not, well help you get that name started just ahead on closing bell. In todays market, a lot can happen in a second. With fidelitys guaranteed onesecond trade execution, we route your order to up to 75 Market Centers to look for the best possible price, maybe even better than you expected. Its all part of our goal to execute your trade in one second. Im derrick chan of fidelity investments. Our onesecond trade execution is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Welcome back. 35 minutes to go here and markets have been under pressure all day. Of course, we are off the lows, the dow still off 77 points. Weve put the russell up there because its clearly the underperformer today, down almost 1 . And you heard still trading at roughly 18, 19 times estimated earnings. So, thats not cheap. Dominic chu, shouldnt it hard to find some movers today, huh . No, a wild day for sure. We are 100 points better than the lows at the dow session. Lets start with trw. This stock is moving higher on reports of a possible takeover bid. Trw later acknowledged he had received a preliminary offer and had hired Goldman Sachs as an adviser. Germanys zf group said it was the Interested Party and possibly buying trw. Then theres Lumber Liquidators hitting a buzz saw after it cut its earnings outlook for the full year, citing reduced traffic in its stores. It also said fewer people are buying homes this year than in 2013, while others are holding off on those remodeling and renovating decisions for their floors. Also, verizon moving higher after its ceo, mole nick adam, told cnbc that the company had added a betterthanexpected 1. 4 million subscribers in the Second Quarter. And well end with wd40 falling after the Consumer Products Company Reported weakerthanexpected thirdquarter results. As a result of that, it narrowed its fullyear sales outlook, so wd40 shares, you can see there, off session lows but still down by about 8 . Kelly, bill, back over to you guys. Yes, they are down. Thank you. For more about wd40 earnings and a realtime view of the American Consumer joining us once again in a cnbc exclusive is wd40s ceo, gary ridge. Gary, good to see you again. Welcome back. Good day, bill. Thanks. Nice to be here. So, youre down about 8 today. There were some soft spots in your report. How do you assess whats going on right now . What happened . Well, today were better off than we were 48 hours ago. We actually strengthened our position for the year. Were predicting an 8 to 9 eps for the year, showing growth globally in all of our markets. So, you know, were not dumb enough to run our business in 90day intervals, so we feel pretty good about our business. But you know how persnickety wall street analysts can be, and they see some softness in the north American Market right now. How do you assess that . Thats not a trend. We saw some softness in north america in the Third Quarter. I think retailings a little bit bumpy. But if you look at our track record over the past ten years in good or bad times, were a little bit recessionresistant. We continue to grow. Weve got an engaged workforce in 188 countries, great brands, great people who go to work every day. Were going to have a record year, we feel good, and you know, this is a buying opportunity. You know, gary, im looking just so, your americas sales were down about 5 , as bill just mentioned, perhaps tied to some promotional activity, shortterm factors in canada cited. But you had sales elsewhere that were looking pretty good. What can you tell us about how the rest of the world is doing, visavis the u. S. . Europe has returned. Weve got solid business in europe. In fact, our business in europe is nearly as big as the u. S. Business. 65 of our business is outside the u. S. These days, and thats the fastest growing. You know, theres lots of people in china who dont know wd40 yet, and were pretty happy about that, and the same in many other countries. So, we feel that if we continue to focus on making that little blue and yellow can available to more people in more places and have them use it more often, weve got a lot of fun to have in many years to come. Another thing thats got analysts attention are your margins. Your input costs are going up, obviously. Everybodys are if youre involved in a business that uses some Natural Resources like you do. What about that . Is that putting a crimp on your profit margin right now . Well, in fact, our Gross Margins strengthened by ten basis points because of the diversification of our product and also, we launched a new line extension about two years ago called wd40 specialist. And where those sales are also helping us improve our margins across the globe. So, we dont see a great deal of pressure on gross margin going forward. We have to manage it. Weve made a number of enhancements in our supply chain to remove costs that dont add value, which we do every day. So, we feel pretty comfortable. You know, gary, you make it sound like everythings just great, and i get that. Youre a ceo, thats your job, but the stock doesnt seem to suggest that. Now, i forgot to ask our staff if we could get a fiveyear chart of wd40. Youve been on a tear since the bottom in 09. Thats pretty clear. But lately, in the last year or so, youve been topping out here. So, clearly, the stock markets sensing that either youre losing some of your momentum or Something Else is going on. What do you say . Well, you know, you cant dance at the party all night, so i guess they want us to sit down for a little while, but we doubled our business in the last ten years and i dont see any reason why we cant do that again in the next ten. We go to work every day to make that brand more available to people, and were a highquality business. We return a lot of cash to our shareholders. We pay 50 of our earnings out in dividends. Weve bought back about 130 million worth of stock in the last three years. Weve got no debt. Weve got an amazing return on invested capital. Were okay. Gary, just real quick, whats your effective tax rate . About 30 . 30 . And you do 65 of your sales outside the u. S. Doesnt that make you an obvious candidate for tax inversion . Well, theres many ways to do that, and we pay taxes in the areas that we earn the income. So, but you know, we need to continue to earn the money and well work out how we best manage our tax systems. But you plan to stay a u. S. Domicile company . Yes, we do. Is that important to you . I think its important to us in a way that, you know, this is our home base, the product was invented here in san diego. Were a Global Company that happens to be based in the United States. Then well leave it there for now, gary. Thanks, gary. See you later. Thank you so much. Good day. Making one product many years. You wonder why crumbs couldnt do the same. Breaking news with scott cohn. An update on something we reported earlier today about the remington 700 rifle, a subject of a cnbc documentary back in 2010. As we reported, the company is in a proposed settlement or a tentative settlement with class action plaintiffs, and we now know that under the terms of that settlement, remington is proposing to offer to replace some of the controversial triggers. Our documentary pointed out that the guns, and some 5 million have been sold are prone to fire without the trigger being pulled and there have been allegations of deaths and injuries attached to that. Now remington apparently settling with classaction plaintiffs in two suits, subject to a judges approval later this year. But part of that settlement, while remington denies economic losses by these plaintiffs, they will offer to replace the triggers, millions of them. Back to you. Wow. Thats amazing. Thanks, scott. Appreciate it. Heading toward the close, 30 minutes left in the trading session here. Now were starting to come back again a little bit. The dow down 68 points after having been down 180 points this morning after big selling in the European Markets. Coming up, wall streets pro Dennis Gartman says when the market was down 100 points today, many of his investments were up. What is he investing in . He will tell us next. Also, later, Federal Reserve vice chair Stanley Fisher delivers a speech in cambridge, mass about an hour from now, and our Steve Liesman will deliver the highlights that maybe could move the markets first thing tomorrow morning, so youll want to stay tuned for that, coming up. D card with a new volkswagen turbo. So why are we so obsessed with turbo . Because theres nothing more exhilarating than a powerful ride. And you can get that in places you might not expect. Like the passat. And also in the funtodrive jetta. In fact, volkswagen has sold more turbos than any other brand over the last ten years. That is a lot of turbo. Hurry in and you can get a 1,000 turbocharged reward card when you lease a new 2014 passat s for 219 a month. Welcome back. Minus signs for the major averages p averages today. At the low, the dow was down 180. An hour ago it was off 45 points, but still down 63 points. Were pointing out that the small cap stocks are taking the brunt of the selling today, the nasdaq and russell 2000 with the biggest hits so far. Also taking a hit lately has been oil, today snapping a nineday losing streak, while gold is, meanwhile, hitting a 3 1 2month high. Jackie sdange lis has the lowdown, or the highdown for both of those right now. Jackie . Good afternoon to you, bill and kelly. Lets start with gold prices, closing at 1,339. 20, up nearly 15 on the session, closing, of course, not long ago. A couple reasons for this. Of course, safe haven buying, as people are eyeing the geopolitical situation, watching whats happening in israel very closely, but also watching the u. S. Markets break down a little bit and also the trouble in europe as well. The fed minutes yesterday. So, a lot of reasons investors are getting back into the gold trade. Gold flirting with 1,350 earlier in the session but couldnt manage to hold that point. Still, traders are saying that the fact were above 1,335 sets us up for a technical move higher. Meantime, lets talk about oil prices for a moment because we were lower most of the session early in the morning, but then we got some buying late in the afternoon. Traders saying they think these prices are going to stay supported, so they see this as sort of bargain hunting, getting into the market at this point and picking up a quick, little trade on oil. West texas intermediate closing today at 102. 93 and brent crude over 109 a barrel. They were both a dollar lower earlier in the session. Buys, back to you. Jackie, thank you. With us to help us navigate the market, Dennis Gartman from the gartman letter, nicholas coalis from evergex group. You put out an email saying even when the dow was down 180 points, you looked at your retirement accounts and you were higher. What are you in . Well have what youre having right now. What is that . Bill, very simple, same things ive had for quite some period of time, predominantly, almost completely alcoa. Alcoas down 6 cents on the day now as i last saw, but this morning, or midday, it was up about 25 or 30 cents. Alcoas been a great winner. Im just sitting tight. When the news came out from espir Espirito Santo, after i sent out the newsletter this morning, i must admit, after the feds minutes last night, i was a bit more bullish. And when i wrote in my newsletter today, it sounded like i was turning bullish, but the news from Espirito Santo is disconcerting enough for me to do almost nothing. Okay. Reporter ill sit with what i have. Im long al coa, im long a little bit of apple. Ive sold calls against them and i have some derivatives still in place. Ive been fortunate, lets call it great good luck, but alcoas been a great winner and its now starting to get to everyones front pages. Is this the start of a riskoff summer trading environment . Over the last couple years, weve seen these finally fall apart. Three years ago, 95 of the moves in any sector was related directly to the s p. Thats down to roughly 68 now by our calculation, and thats a new low post financial crisis, so, we are slowly unwinding these correlations. Shouldnt we be worried about that . Because i can recall being at a conference, basically at the peak of correlation, that was called correlation 1. In other words, the second that we say, look, everythings correlated, it started to drop. Is that now the risk here, is that correlations all begin to rise again . Absolutely. Were watching that very carefully. And as we talk to clients, theyre concerned about it as well. It feels like the pendulum has swung all the way over to the healthy side and now it wouldnt be unexpected to see it come back to something a little more neutral. Dennis, clearly, defensive issues have done well lately. Yes. And gold popped somewhat today. Are you whats your view on your favorite precious metal right now . Ive been bullish of gold in euro terms and in yen terms, and i think we had an important circumstance in the last 48 hours with gold breaking above 975 euros to the ounce. That breaks any down trend. I think thats impressive. Euro i think has some problems here. So, owning gold in terms of euros makes sense. And i still think that owning gold in terms of the yen makes sense. And even for the first time in quite some period of time, now that weve stayed above 1,300 and now above 1,335, you might even make me interested in gold in dollar terms, but its gold in euros that i think is most important, and i think the europeans have a great good deal of difficulty. I think this thing with Banco Spirito with the Portuguese Bank. Im getting confused here. The holy spirit. The Portuguese Bank. As i like to say, theres never just one cockroach and im afraid to say this could be the first of many to come. I could be wrong. Ive been wrong many times before, but this one bothers me a great deal. Nick, what would you recommend to investors right now . Should they position for on some kind of traditional riskoff kind of event or just look at the move in gold and maybe see some kind of flight to safety bid there and hide out there or none of the above . Weve had 32 months now without a 10 pullback. Its totally rational to expect that at some point. This doesnt feel like the start of it, the way weve pulled back up towards the end of the day, but it is very rational to expect. And if you are worried, take some of it off the table. Some of the house money can go in your pocket. Would it be telling, though, what causes a 10 correction . I mean, weve been through so many geopolitical issues the last few years, certainly the Financial Issues that we faced have not caused a 10 correction. I wonder if it happens this time, is that meaningful in some scheme of things right now . Yeah, we talk about this all the time on our options desk, what would get the vix back to 20, which is the longrun average. And there feels like there its to be a cataclysm just to get enough attention to push us there. Its very hard to say. I cant come up with a scenario off hand. Dennis, can you . At this point, it will probably be some more, some increase in the geopolitical circumstances that prevail. That seems to be the kind of catalyst that we tend to get. Clearly, its not going to come from the fed. The fed is going to be as accommodative as they have been. So, thats not going to change any time soon. The ecbs going to remain and be even more accommodative. So, i guess by process of elimination, its going to have to be some geopolitical circumstance. Or we just run out of buyers. Or that. Right . Or we just run out of buyers. Thats happened before, too. Gentlemen, thank you both. Thank you. Appreciate your thoughts. See you later. Heading toward the close, about 19 minutes left here. Slowly coming back again, the dow down about 60 points here as we head toward the close. And later, this is more of a nightmare than the American Dream. Why housing may be unaffordable for many living in this country. Well be back in a moment. vo watching. Waiting. For that moment, where right place meets right time. And when i find it i go for it. announcer at scottrade, we share your passion for trading. Thats why we give you the edge, with innovative charting and trading features, plus powerful mobile apps so youre always connected, wherever you are. Because at scottrade, our passion is to power yours. Welcome back. So, were keeping a close eye on markets here with 15 minutes to go. There has been a bit of a comeback in the session. We were down 180 points in the dow this morning. Europe closed, markets started looking a little better and now the dows off about 56. The s p now only about 6 1 2. The nasdaq 18. Were seeing on the wires, we were just looking during the commercial break, carl icahns speaking somewhere. We cant figure out where that is yet, but the quoelt on the wires from carl icahn is, in my mind, it is time to be cautious about the u. S. Stock markets. He says, im being very selective about the companies that i purchase. But no big response yet, bob pisani. Im being selective about the companies i purchase. Hey, we may make it into positive territory at the rate were going. All the damage that the s ps done in the first 15 minutes, then the markets moved up right to the european close and sideways from there. Great news, Energy Prices are going down. Nat gas is down four days in a row. My air conditioner thanks you for that. Brent also has been going down, although it just snuck into positive territory a minute ago. Great news for all the people out there driving. Its putting pressure on the energy stocks, range resources, small cap names that were darlings in the beginning of the year are down, but ill take 4 or 5 down this week for a lower air conditioning bill. Thank you very much. Wells fargo tomorrow earnings really start. I love wells fargo, why . Because its not citigroup. Its a community bank. They do home loans, mutual funds. Its easy to understand. The issue we want to know about, how much has the Mortgage Business slowed down . Slowed down a lot last quarter. Is it a little slowdown or like Lumber Liquidators . Oh, my heavens, what the heck happened kind of slowdown . Thats the only big issue. Its been down four days in a row, but look at this monster. Guys it was up 50 , it was 35 in the beginning of 2013. That is a monster move for the Biggest Community bank in the world. Guys, back to you. Yeah, what slowdown in housing . Right . Thank you, bob. Glad your air conditioners doing better. 13 minutes left. Were down 60 points on the dow as we come back from those lows this morning. Dow was down 180 points. That comeback continues here. Yes. Keep an eye on what happens in the next couple of minutes. Yes, we will. As we head into the close. And this could make or break the markets tomorrow. Federal reserve vice chairman Stanley Fischer delivering a speech in the next hour of the show. Well bring you the highlights. Youre watching cnbc, first in business worldwide. About speeds and feeds. Its all about latency. Its all about how fast does it run. I often sit with enterprises who ask me about how Mission Critical and hows the performance of the cloud. And i tell them, if you can make gamers happy, you can make anybody happy. Speed is made with the ibm cloud. E financial noise financial noise financial noise financial noise at every ford dealership, youll find the works its a complete checkup of the services your vehicle needs. So prepare your car for any road trip by taking it to an expert ford technician. Because no matter your destination good maintenance helps you save at the pump. Get our multipoint inspection with a Synthetic Blend Oil change, tire rotation, Brake Inspection and more for 29. 95 or less. Get a complete vehicle checkup only at your ford dealer. Ten minutes left in the trading session here. If youre just joining us, youve missed a lot. The dow was down 180 this morning. A selloff in europe precipitating that, but weve since come back in the afternoon session, the dow down 63 points. Joining us is thomas fross and keith. Thomas, a roller coaster ride this week. More volatility ahead . Absolutely, i think volatilitys going to come up with the vix only at 12. But what were especially glad to see is like an event that happened this morning with portugal, yet the markets been resilient, 180 points down. So, why do you think there is more volatility ahead . Because there will be another black swan event, we feel, possibly in europe, possibly in the United States, but the vix at such a low how do you position for that. I think you think long term. We encourage our clients to think long term, think like an investor, dont think just like a trader. Keith, youre the trader type. Whatd you make of the selloff this morning and comeback this afternoon . Whats the real trade here . I agree with tom on the resiliency of the market, but theres still a tugofwar between the bears and the bulls and either side is trying to seize control right now. Whats interesting about the Portuguese Bank is this was foretold that people were paying attention. Absolutely. If you look at the etn, the eufn hit its high back in june and since lost 10 , culminating with today. The portuguese markets been down for a few days, not a oneday event. So, the word started to leak out, but to toms point about more volatility coming, i absolutely believe that in july we got shortterm overbought on the vix today. We hit our levels, so we started selling that signal a little bit. But this is typically the weakest period, particularly in a election year, for the nasdaq and russell 2000. I urge people to Pay Attention to this. The russell 2000 from trough to peak and back again for early, for may, it went up 11 and has given back 4 . Pay attention to that. Thats the best indicator of the u. S. Economic health. If we start selling off in the russell, it could take the market down with it and increase volatility rapidly. What are you doing right now . Are you buying here . We are buying. Holding back a little bit, waiting to see we are absolutely buying. The fed is still so accommodative. Yes, theyre beginning to peel back on all their bond buying, which we think is a healthy thing for the u. S. Economy. It really shows that the fed is saying the u. S. Economy doesnt need crutches anymore. The u. S. Economy is back on its own feet again, which is a really healthy thing. So, yes, we are buying. Cyclicals . Yeah, i mean, the momentum players have been taken out and hit. The defensive plays have been doing well . What are you buying here . Underweight small cap, were underweight overseas. We like Large Companies paying good dividends in todays market. Are you buying social media here, keith . You know, we try to pick and choose our spots between and talk to clients about it. I think were in a pretty tenuous position with the stock market right now. I think Second Quarter earnings are going to be very important. And as you know, i always look at Top Line Sales and what theyre forecasting going forward. Im a little bit bothered by things that were hearing from, like, Container Store and female dollar, is the consumer falling into this [ everyone talking at once ] yeah. And thats going to be troubling. If we get a spike in gas prices, even though theyve come back, the Energy Complex has sold off a little bit in concert with the rest of the market, but if the gas prices spike here, there is a correlation with the equity markets. So we need to Pay Attention to those things. When the large retailers report later on, the Big Box Stores as well as the Home Improvement retailers, we really need to Pay Attention to what theyre saying. All right, well be doing that. Stick around and well see you in a little bit. Ill scoot. See you at the top of the hour. We have the closing count down coming up in a moment. And after the bell, this may or may not be part of the now infamous correction that may or may not be coming, but whenever we do have one, investors should have a lot of stocks to pick up. Well talk with pro stock pickers and theyll share their Shopping List in just a bit. Udi for her drivers test. Secretly inside, you hoped she wouldnt pass. 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This Portuguese Banks stock down sharply, took the European Markets with it. Our stock, if we show you the dow this morning, down 180 points on the low right on the open this morning, and then a gradual comeback the rest of the day. The russell the hardest hit of the major averages again, as it has been this week after we hit those peaks last week, down about 1 here at 1162 on the russell. And as keith was pointing out, the vix had been on a comeback, up 7 , almost 8 . Today were at a whopping level of 12. 56 here today. So, youre starting to sell into that, are you . Yeah, absolutely. So, we got a shortterm overbought on the vix, and you would sell you dont sell the actual index, but you can sell options and other derivative products on that. But i think more importantly, as people as i was saying earlier, people really need to Pay Attention to the small caps, especially through earnings season, and we dont see the russell 2000 getting shortterm oversold until it gets back to may lows. We just talked about its selling about 19 times earnings right now and one of the analysts was saying theyd wait for it to get back 15, 16 times earnings. A much more normal valuation, yeah. I think the bigger story today was that i think most investors didnt look at what was going on in europe. Just saw the market come back up. I think most looked at the jobs numbers. Great unemployment numbers that came out today, initial jobless claims, 304,000. Did come down again. Weve earned a million jobs back since the beginning of the year, 9 million since the bottom of the great recession. So, look, we see whats going on over in europe. Its kind of in the Rearview Mirror of what happened in the United States in 2008. What we see in america is that american economys strengthened despite what were seeing overseas. Youre willing to look beyond the volatility right now . Absolutely, 100 . The fed, as i mentioned, is accommodative. Absolutely. Youre going to play the volatility in the meantime, though. Of course. We play back and forth and we love that from our clients, i have to admit that. But i agree with tom, as long as you have somebody like the fed backstopping this economy and the market at least for the time being. Yeah. Its very hard to sell this market. Thats what we saw today, the big selloff in the morning and then people came in, the buy the dip crowd said, ah, my opportunity is upon me once again. They came in and we saw the bounce. Look for that to continue. Once the fed buys in on the bond buying, were up 30 last year. So, what are we afraid of at this point . Its going to happen, but right now were very comfortable. Very good. Thank you both. Good insights today. The dow down 71 points after having been down that 180. So, anythings possible, on the table. Well see what happens tomorrow, what happens with the asian market tonight and European Market tomorrow. Stay to tuned. A lot more to come here on the second hour of the closing bell with kelly evans and company. Ill see you tomorrow. And welcome to the closing bell. Im kelly evans, and its 4 00 here on wall street. Heres how were finishing up the session that has seen lows of about 180 points in the Dow Jones Industrial average this morning. Looks like were going out to the close with a decline of less than 70. Meanwhile, the nasdaq, the s p 500, all the major indexes are under pressure today. Those two off about 0. 5 , but the russell is off 1 . Its having a pretty rough week. Lets talk to our panel now about that and whats happening in the market this week. John is from gfi group, cnbc contributor carol roth, our own sara eisen and cnbc contributor jon najarian, all with me to start things off. Welcome to everybody. Listen, john spelanzani, we were down sharply this morning, we came back. Is it significant that we didnt close positive . How do you read the action today . Well, i thought the action this morning was pretty good. The dip was bought very well. I think that italy actually came back fairly significantly down 2. 5 . It was down about 1. 2 , it closed down about 1. 6 . We saw the bonds were really flight to safety bid. That came off after the auction. They were just 30s around one, two ticks either way. Gold also went up initially, but it kind of hit resistance at the gob, the 130 level. So, i think all in all, its earnings season, we go sideways. Weve been going sideways for a month, and we have a lot of noise, but guys are on vacation, people are on vacation in europe. But heres the amazing thing a lot also, one last thing was today, aai, the individual investors. Right. The bears twomonth high and the bulls at 37. So, theres not euphoria out there and theres not a lot of pentup demand were going to say everybody has to head to the flood gates. People really want to buy the dip, i think. Its striking given what you just said given whats happening in the credit markets. I know we dont talk about this a lot, were focused on equities, but if you want to understand the tide thats lifting the market here, you have to understand that even during a sleepy, july, summer session as youve put it, weve now had one of the busiest starts to a july in Corporate Bond issuance. Its come from some of the most unloved players of the past, murderers row as were jokingly calling it. Weve got gm financial. Weve, meanwhile, got aig, ally bank, calpine, moodys, all in the market and their yields been upsized or offerings have been upsized to some extent. Dr. J. , these issues in portugal are real, but they are not yet, it seems, dislodging the markets here. Right. And you know, i dont want to just dismiss the bank in portugal, but, kelly, 3 billion market cap, thats what its down to, for the last several years, several regulators have said do not trade with this bank, this is a bad credit risk and so forth. So, as far as the contagion that we had in 08 into 09, youre not going to see that from a bank like this. So, what i looked at was we pay bigger fines than this 3 billion market cap of this bank. Every day. From our banks here as well as barclays, Credit Suisse, ubs, paribas and all that. So, this is not really whats likely to be a trigger for some contagion, not in my opinion. It does speak to the fragility of the european Banking System and some of the problems there that havent been fixed and sort of have been papered over with Monetary Policy, which potentially is the up shot to todays session, and that is we could see more of it. You hear people talking about the ecb finally having to act in an aggressive way, push them into their Asset Purchase Program because of the problems bubbling up. Theres still a fear there are skeletons in the closet because their Banking System didnt undergo the refinancing and recapitalization that ours did. I think, though, if im looking internationally, im not as concerned about whats going on with one bank in portugal as i am about economics more broadly from a global perspective. We saw numbers coming out of europe and coming out of china and japan that were not really what was expected. And to me, i think that thats the bigger story. Im actually surprised that some of that data seemed to be ignored as the session went on, but i think that there are some of us that really dont believe the story that there is as big of a recovery as some other people have been saying that there is but we saw and the data is saying that. Tuactually on that point, ste widing is from citi private bank, also from the nasdaq, brian kelly to wrap up the days trading action. Steve, what say you about the prognosis for growth across europe and the u. S. . I think u. S. Growth is in very good shape. I think europe is about four years behind the United States in terms of recapitalizing banks, as relatively depressed. So, if it looks fragile it should, and thats where there still is opportunity. But we have been remarkably complacent and just sleepwalking in terms of future volatility being priced into every asset class. So, you ignore things week after week, every possible thing that could have gone wrong gets ignored, and now suddenly, everything is magnified, including some lag data out of europe for the month of may. Brian, we markably complacent, sleepwalking . How concerned should investors be here . Well, i think you need to be concerned if youve been in the market and youre up so much, you certainly want to keep those profits. I would not be worried about the portugal bank. Im with doc j. On that. This has been around for a couple weeks now this has been a big problem over there a problem, not a big problem. I am a little bit more concerned about whats going on in asia, though, and whats going on with the slowdown in china. You saw some of the german exports. Obviously, germanys biggest customer is china. So, when you start to connect the dots, you say, all right, maybe the economy hasnt reaped the Global Economy hasnt reached that escape velocity and maybe we wont. So, that to me is probably a bigger issue than what went on with the Portuguese Bank. Its not going to stop me fro t what about copper metal . Weve been watching this higher and higher, since the june lows, its up. Everybody was throwing their arms up in the air about copper breaking 3. Now its nearly 3. 30. What do you make of that, b. K. , as far as it doesnt sound like its falling apart over there. No, it doesnt. We all know how they use this for banking and so forth. Right. And the problem you have with copper right now is you have this dr. Copper that everybody thought was the economic guru, right . But the problem is, it got used for finance in china, and then where was some mine issues, supply issues on the mine side. So, you got kind of the supply side of it skewed and the demand side of it didnt matter as much. I have been personally watching oil a little bit more as the geopolitical premium comes out. Youve seen that oil come down. I think thats a bigger predictor of whats going on in asia. Again, i dont want to say that the worlds falling apart by any means. Its probably just not as strong as we thought it was two weeks ago when we got some really good pmi numbers. John spallanzani, remind us, is it the three ts, the four ts . The four ts right now. Four ts. We have tax policy, trillions, time and whats the last t . This is like well, i time, trillions, tax policy and the fact that, you know, as we go forward, the fed keeps on pumping in trillions and trillions of dollars, but the money just sits there. So, as time goes on, Companies Start to put that money to work more and more. And obviously, theyre doing buybacks, a lot of Corporate Bond issuance. The difference between us, and obviously, europe, is the fact that in europe, the banks are the Financing Mechanism for all the companies in europe. There is no Corporate Bond market. So, thats why they cant sell assets the way we were able to do and thats why theyre behind the eight ball. Theyre still not getting the capex spending. Thats the one thing that you didnt say. And if you look at a number like japan today, that may be a good signal that were not spending enough here as we might need to be. Steve weiting . Go ahead. Go ahead, steve. Just make a point about china, you had 7 export growth in the year through june. We had pmis showing outright expansion and an improvement. And chinese, hong kong and taiwanese stocks on balance rose last night. And then when you started to see all the excuses in todays european and u. S. Action, it was again, you know, devastating for us. So you know, i think you found a lot of excuses for this really, really calm market to break. And steve, what stands out to me is that weve had a number of excuses since march 2009 when this rally bottomed. I mean, that has been the persistent theme, that there has been a wall of worry. And whether its a problem in the u. S. Economy not being equally distributed or elsewhere. And you see a Market Reaction like this, which is that the losses dont even hold. I was here this morning when the s p was down 1 . Look, just yesterday we reported alltime highs in unfilled job openings in the United States excuse me, higher highs than we saw during the entirety of the last expansion. You know, we are going through some time where weve got to figure out what that means. The fed is winding down qe. Everyone has had october on their calendar as the end of these asset purchases, and it was suddenly news. I mean, were going to be in a more uncertain period for what the fed does and when, and that should have a little bit of twoway action, a little bit of volatility priced into the future of these asset markets. Brian kelly . Yeah, i think thats right. If theres anything thats mispriced, its volatility at this point in time, and particularly volatility on the bond market. Were seeing multi decade lows in that volatility. So, it could go one way or the other, but when it does break, its going to move quite a bit. Now, if we get the economy slowdown or the malays or secular stagnation that some people have talked about, then bond years will probably go lower and probably dramatically not because of the economics but just because theres no volatility and theres lack of liquidity. Well leave it there for now. Brian, steven, thank you for joining us this hour. Catch brian coming up with the rest of the fast money crew at 5 00. Theyll be asking a top analyst if banks could be the new dead money trade. Dont miss that. Weve got some breaking news now. Amazon responding to the ftcs lawsuit that it alleges it unlawfully billed parents for childrens unauthorized inapp charges. Amazon saying in a letter to ftc chairman Edith Ramirez it is deeply disappointed after what it believed were constructive meetings with the ftc over the last several weeks, saying the ftc is pressuring it to enter a Consent Order in the mod yeflt apple Consent Order. Lets get an update from the breaking news desk. In this letter to ftc chair a woman, amazon says we have continually improved our experience and says its been treated unfairly, pursuing litigation against a Company Whose practices were lawful from the out set and that already met or exceeded the requirements of the apple Consent Order makes no sense and is a misallocation of the commissions resources. Kelly, these comments that theyre deeply disappointed after the meetings that amazon and the ftc have been having indicates that amazon wanted to settle, like apple did, rather than let this go to court. Kelly . All right, julia. Thank you. We also have some news now from dominic chu, or a quick market flash. Hi, dom. All right, kelly, check out whats happening with the gap stores. The stock is moving lower 2. 5 in after hours. The retailer reported its june Comp Store Sales fell by 2 . Again, you can see their shares off their after market lows but still off by about 2. 5 . The weakness did come from both gap stores and banana republic. Old navy was the only three of the major only one of the three Major Business segments that posted sales gains in june. So, again, gap stores lower on weaker Comp Store Sales. Back over to you, kelly. All right, thank you. Stocks making a big comeback today after they were sharply down this morning, but my next guests are watching some names in particular for a pullback before they pounce. The stocks they say you cant afford to miss out on when and if this correction deepens are straight ahead. Also, fed vice chairman Stanley Fischer is minutes away from making what could be a marketmoving speech. Stick around. You do not want to miss these key headlines. We will have them for you. And a new report finds the recovery in home prices is pricing Many Americans out of the Housing Market. The American Dream now unaffordable. That story coming up. In a world thats changing faster than ever, we believe outshining the competition tomorrow quires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. At every ford dealership, youll find the works its a complete checkup of the services your vehicle needs. So prepare your car for any road trip by taking it to an expert ford technician. Because no matter your destination good maintenance helps you save at the pump. Get our multipoint inspection with a Synthetic Blend Oil change, tire rotation, Brake Inspection and more for 29. 95 or less. Get a complete vehicle checkup only at your ford dealer. So, after morning market concerns over banks in portugal that sent the stocks down sharply early on before coming off those lows throughout the day, many still say the correction is coming. So, if it does and when, what stocks should you have on your Shopping List . Our next guests are ready to go with their picks. Joining us now, shane sederman from Bay Ridge Financial Group and mark lishini from Janney Capital management. Welcome to you both. Shane, what are you watching for and when . What im looking for is inflation right now. Youre seeing it spin out of control a little bit. You have food prices up big, youve got oil rising, and i like silver wheaton, slw. So, this is an inflation play. You think thats why this market has started to lose its footing and that youre going to make inopportunistic moves based on that playing out . I just think the valuation silver wheaton gets fixed prices, down at 5 just to buy silver or lower, and theyre well managed. Theyve gotten beaten up. I like equities that are beaten down and nobody likes. I think silver wheaton valuationwise makes sense. Mark, what about you . Kelly, one of the institutions we like is Regional Bank by a name of pnc financial. Theyre trading about 13 times. Their footprint covers basically the east coast and they have a particularly large franchise in the populous midatlantic and florida areas, and we like the prospects for the domestic economic recovery theme that we believe is under way and is a consequence of better loan activity, commercial and industrial, but also an improvement in the Housing Market that bodes well for their net interest margins. Mark, i see pcn and i want to bring in the panel in a second, but theyre only off about 1 today. Theyve done pretty well this year. So, even though they havent seen a big move lower, you like them here . You like pnc . Id be comfortable owning them in here, kelly. And if they went down in sympathy with the market, if it continues to deteriorate, then id be willing to buy in along the way. Okay, got it. I think if youre going to play the financials, the Regional Banks are credentiertae way to go. I wanted to ask our guests, are there certain regions that you like versus others, especially having to do with the energy boom and job creation, perhaps down in texas or ohio . Are there certain banks you see around those kinds of themes . We do, and frankly, we would own that in a proxy. Something like the etf under the symbol kre, which kind of captures a basket of different Regional Banks. So as a consequence, youre not getting overly concentrated in just one, and where you might have otherwise got a neighborhood right, you picked the wrong house. But again, we like pnc for that very reason that you had mentioned, and that is, the franchise that it is exposed to across the midatlantic and the southeast particularly seeing a recovery in the Housing Market in florida, and obviously, all the activity in and around the midatlantic area, particularly washington, d. C. , bodes very well for deposit growth for pnc. Shane, im curious about your call on inflation, not necessarily such an obvious trade. Yes, were seeing higher prices for food and for some things, but janet yellen says its just noise and youre not really seeing the reaction in the bond market. Why are you so sure of this call . Well, listen, i deal with the consumers from main street to wall street, and when i look at the consumers, theyre all being pinched. A lot of the middle class, even the poor. Yes, i guess people making seven figures, theyre not affected at all, but foods up drastically the last couple years. Incomes are not up, but foods up huge and gas prices are starting to go toward alltime highs, i believe. John spallanzani, do you have a Shopping List here . I think silver wheaton is a nice play, but the market cap is kind of high and theres a very little Short Interest. So, in terms of what we like to play, we like to play stocks with good themes and high Short Interests, possible takeout candidates. Pnc looks good. Obviously, halliburton, of the four we were discussing today. I think those all look good. You know, we like the high free cash flow, high Short Interest, and obviously, a good theme. And oil and gas, you know, arm hammer, it could be a buffet. What about you . Yeah, schlumberger, halliburton, love all those names. As far as the miners, weve seen in fact, newmont was one of the high performers of course afears in portugal shot people over into gold and some of the miners. Im not a believer, kelly, that they hold those gains, in the short term. I think you buy them on dips, some of those miners, but in particular, the gold miners with gold jumping up to 13. 40 or whatever it hit, seems frothy in the midterm for me. What do you think about a company like Madison Square garden . We were talking about lebron and waiting for his decision. We have a valuation on the clippers now at 2 billion. Obviously, that bodes well for msg, which holds the team, has all of the other properties. Do you think Something Like that is undervalued . I think that is also another stock with a good franchise, good Short Interest and a good theme long term. All right. Theres always a trade somewhere. Guys, thank you for now for joining us this afternoon. Thank you. Well see if markets do, indeed, sell off further in the days ahead. Stanley fischers about to make his first Public Comments since becoming fed vice chair. Will he give necessary clues on when the fed will raise Interest Rates, how does he feel on inflation and does he differ at all from what janet yellen has been saying . Plus, home prices are rising faster than wages in almost every part of the country. Diana olick looking at how thats making homes unaffordable for more and more people and whether thats sounding the alarm for the economy and this market, later on the closing bell. During the cadillac summers best event, lease this all new 2014 cts for around 459 a month or purchase with 0 apr and make this the summer of style. If yand youre talking toevere rheuyour rheumatologistike me, about a biologic. This is humira. This is humira helping to relieve my pain. This is humira helping me lay the groundwork. This is humira helping to protect my joints from further damage. Doctors have been prescribing humira for ten years. Humira works by targeting and helping to block a specific source of inflammation that contributes to ra symptoms. Humira is proven to help relieve pain and stop further joint damage in many adults. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. Blood, liver and nervous system problems, serious allergic reactions, and new or worsening Heart Failure have occurred. Before starting humira, your doctor should test you for tb. Ask your doctor if you live in or have been to a region where certain fungal infections are common. Tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. You should not start humira if you have any kind of infection. Take the next step. Talk to your doctor. This is humira at work. Over 1. 2 billion eyeballs are on us during the two weeks at wimbledon. True tennis fans want to know whats happening. They dont want to just see whats happening, they want to know and understand why its happening. Anybody can just put data up, but we want to get a reaction, make it far more interactive. We rely on the cloud to provide that immersive digital capability. Give fans more then just the game with the ibm cloud. Welcome back. We have a developing story on one of the more puzzling stocks of the day. Scott cohn with the details now. Hi, scott. Kelly, its a pink sheet stock that was trading at just 6 cents a share just last month before hitting a high this week of around 20. And it was trading at around 16 when we went in on street signs this afternoon. As you can see, it traded off considerably as we reported there doesnt seem to be in there there, but still, its 13 a share. The company purports to run a business social networking website, but its hard to tell by looking at it whether the site is operational. An attorney who wrote to regulators on behalf of the company last month told us he no longer represents the company. And the ceo listed on the companys last s. E. C. Filing in march as the only employee says he no longer works there. Cynks office in belize doesnt appear to exist and the phones disconnected. Yet, somebody has been buying the stock and pumping it to a market cap in the billions. If promoters have been paid in company stock, theyve made a lot of money. The s. E. C. Has declined to comment. Yeah, scott, stay with us, if you will. I want to get some thoughts here. Dr. J. , let me just pose this question. Lets say the five of us here wanted to create 4 billion in market cap, would we be able to do so out of thin air . You would, because you cant borrow these shares to short them. So, in other words, as we all know, theres a buyer and a seller every time you have a stock that trades. Well, in this case, theres simply no shares that you can go out and borrow, kelly, so youre doing a fail to deliver if you went and shorted these shares because you cant borrow the stock. Thats amazing. So, could you do it . Yeah, but this does seem something that the regulators to shut down, because i dont know that ma and pa or Goldman Sachs themselves could shut it down just by selling i like what carol said about the potato salad crowdfunding. Maybe thats a better investment. Weve got an app that says yo for a million dollars, weve got potato salad, 50,000 for a kickstarter on potato salad. Nothing surprises me these days. I like being yoed when a goal is scored in the world cup, by the way. John . This is one of those stocks that obviously gets on the message boards, people get excited about it. They dont really follow the market cap. All they do is follow the price. They have no idea what the market cap is during the day. Ill bet if you polled people out there, they wouldnt know it was 4 billion. Right. So, i think thats the problem. People look at price, they dont look at the total value of the company. The majority of times. Or apparently what the company does, either. Yeah, even what the company does. Im wondering, is this a case where people dont know any better or they know exactly what theyre doing . They see the momentum, thats for sure. Yeah, momentum. Talk about throwback thursday, this is like 1999 again with the promoters and the message boards, and they could make a penny stock take off. And its one of the reasons that were so wary of ever talking about a penny stock or an illiquid stock like this one, but i dont know exactly what it tells you, other than these touts are back in the market. Yeah. Usually theres only one small firm thats making a market in this stock. They think that, you know, obviously j. T. Marlon. Weve got to go. Thank you. Does fed vice chairman see eye to eye with janet yellen . Steve liesman has the scoop on what he will say. Dont go anywhere. It elicits pride. Incites envy. And unleashes wrath. Temptation comes in many heartpounding forms. But only one letter. F. The performance marque from lexus. Became big business overnight . Like, really big. Then expanded . Or their new product tanked . Or not . What if they embrace new technology instead . Imagine a companys future with the future of trading. Company profile. A Research Tool on thinkorswim. From td ameritrade. A Research Tool on thinkorswim. Really. So our business can be on at ts network for 175 dollars a month . Yup. All five of you for 175. Our clients need a lot of attention. Theres unlimited talk and text. Were working deals all day. You get 10 gigabytes of data to share. What about expansion potential . Add a line anytime for 15 bucks a month. Low dues. Great terms. Lets close. Introducing at t mobile share value plans. With our bestever pricing for business. Oh i knew i forgot something. Ill just do it now. Well, were boarding. No, ill use citi mobile. Takes two seconds, better safe than sorry right . Yeah who knows if well even get service on the islands . What no service . Seriously . No electricity, were going to make our own candles, were going to churn our own butter. Oh, we lost one. Cant leave a bag unattended. Bank from almost anywhere with the citi mobile app. To learn more visit citi. Com easierbanking welcome back. Federal reserve vice chairman Stanley Fischer making his first Public Comments since landing the number two post at the fed. Steve liesman has the breaking news on these closely watched remarks for us. Steve . Yes, thanks, kelly. His first remarks not talking about Monetary Policy or the economy. Stan fischer instead choosing to talk about financial reform and the need for it until the United States, saying that the u. S. Needs to be vigilant about the next financial crisis, it is coming no matter what we do and will not be identical to the last one. Fischer saying that the u. S. Bank system is stronger with tougher capital and liquidity rules in place as a result of the dodd frank legislation. Now, he takes interesting views about breaking up the largest banks, saying it would be complex and the payoff would be uncertain. In that sense, he echoes comments by bill dudley. Breaking up the biggest banks says would not end the need for the biggest bailouts, pointing out that the other was a result of smaller banks. Too big to fail premium as has declined since the financial crisis, something he puts to the results of the dodd frank regulations. Too big to fail, however, is down due to financial regulatory reform. He also says that it raises questions, though, about the role of too big to fail in the financial crisis. Hes not entirely sure it was the reason for it, but he supports rules that make bigger banks hold more capital, kelly. Again, no comments yet. Well be awaiting those to see where stan phifischer stands relative to janet yellen. Always an issue with bringing in a big guy like stan fischer and wondering whether or not hell have the same views as janet yellen. Plenty of speculation on that. Steve, stay with us. We have greg ip along with our panel. Greg, hes emphasizing Financial Stability here, and while thats not specifically Monetary Policy, it is in some way. What do you make of these remarks . Well, the part i found most interesting was when he discussed the possibility using macro prudential controls like higher Capital Requirements to deal with asset bubbles. And if youll recall, janet yellen talked about that just a week ago at the iimf and basically said thats the first line of defense. Were not going to use Monetary Policy. Stan fischer struck a much more circumspect tone. He used these types of controls at the bank of israel and he said were not really sure if they worked. In that, i sense a skepticism on his part that you can rely on these nonmonetary tools, but he did not go the additional step and say, therefore, we may have to raise Interest Rates instead. Right. That was my point, greg, when i read that, was that he didnt make that extra point, which is that, okay, if these administrative things dont work, for example, clamping down on Banks Holdings on housing, then should we use the bigger, blunter tool of Interest Rates . And he didnt go there. Its very stan fischeresque to say, hmm, this is interesting, and then kind of leave you to wonder what exactly hes thinking. And i dont follow it entirely what he soos aying either. Im curious how this will all get described. But if the headline to some extent, greg, is that fischer says Financial Stability board may need greater power, but what youre saying is that hes not sure that the financials or the macroprudential tools really work, then what is he actually saying . As steve said, its very Stanley Fischeresque, in that even while talking about the possibility of the Financial Stability folks needing more powers, he was quoting donald kohn, a former fed vice chairman as saying that. Right. He wasnt putting it in his own voice. Its hard to tell exactly where stan fischer stands reading the speech. Can i raise a bigger point . Im interested what greg thinks about this. It was always an interesting choice to bring in stan fish ferber. He was the professor for many of the worlds central bankers, seen as a titan among central bankers. When stan talks in a room, he talks in very quiet tones and people stop ruffling their papers so that they can hear what he has to say. And is there some danger here, in your opinion, greg, of bringing on a guy like this . I know he will strive to walk in stride with yellen. Will he be able to achieve that . Its a danger if a split develops between fischers and yellens main view about what to do about the economy. If instead, theyre very complimentary, where they basically sound ideas off of each other and then arrive at a consensus, which is roughly how bernanke worked with yellen and with don kohn before her, then i think its a strong team. Its a bigger issue if they end up having basic differences of opinion, the way, for example, Alan Greenspan did back in the 90. I would just add, because of his experience at the imf and bank of israel, working internationally, just to have portugal in the news here, he spoke so many times as the governor of the bank of israel about the concern of europe and europe not being fixed, specifically the concerns of the banks and how they link to the sovereigns, and so, you want to have someone like this in the fed if we do start to see this kind of crisis reignite. Absolutely. Absolutely. Dr. J. . Ive heard nothing but good things about mr. Fischer and his ability to get along. So, to steves point, i would be surprised if he and ms. Yellen were not able to find ways to be complimentary, rather than adversarial. Yeah. John spallanzani, fischer was always i guess seen as more of a risk to the markets, more of a hawk than yellen, but so far, it seems as if hes being careful not to let that impression play out. I think its always great to have a number two on the bench, obviously. And hes world renowned in terms of his monetary theories. I think also that, you know, the fact that we saw im sorry, kohn was with greenspan, kohn basically wrote every fed statement. The fact that we have yellen and i think right now, we want to concentrate on what yellen and dudley have to say, not really what the hawks have to say, because dudley controls the new york fed. The new york fed basically controls fed funds, repo and everything else. And yesterday there was a big paper that came out to say that they wanted to keep the repo rate, once they started to maybe snug up a little bit, only changing maybe five to ten basis points away from where the fed funds is. So, this way, people cant gain the system, so to speak. 20. Im sorry, 20. Greg, do you think theres a heated debate working up . Lets not worry about it lets keep the rates lower for longer. Other people are saying were running out of slack. Time to start moving that up faster, and that is a debate thats only going to get more heated in coming months given what weve seen both with inflation coming off the bottom and the Unemployment Rate coming down faster than anybody expected. Hey, greg . Greg, can i just push back against that just a little bit in the sense that when i read that, it sounded to me like the same old same old in the following way. You have these guys who have wanted for a long time not to be in the current policy regime, and we know they want out and now theyre talking about there being a debate about slack. When you boil it down and look at where, when each side wants to raise rates, how much difference is there really between the hawk and the dove, if you take the center of each wing . I dont find a whole lot of difference. I think the bigger difference is 2016. But when it comes to next year, i dont think there are hawks that want to raise rates, what, before the First Quarter of 2015 versus the second or Third Quarter . I take what youre saying. If you take someone who wants to raise Interest Rates this year, maybe theres a threeyear difference, but i think the more interesting thing to come through the minutes, and stan fischer may have something to do with this, is they want to stop talking at all about a date. Theyre worried the market has too much certainty, too much confidence about the path of rates and this is one reason why volatility is so low, perhaps dangerously low. Now that youve seen in the minutes and some of the fed folks talk about that, i wouldnt be surprised to see a little more volatility creep back into the bond market, creep back into money market rates, maybe back into the stock market as we develop more twosided risk around the fed fueled by their desire to talk less about the date. All right. Weve got i disagree with that. I think volatilitys low and the only reason why its low is because Interest Rates are very low around the world, and Interest Rates are one of the main components of the vix in terms of how you calculate it. So, until Interest Rates go up which i dont really see because inflation is so low and we had a 2. 9 negative gdp print and a problem in portugal, i dont think the vix will go up. I know youve got to go, but they didnt say anything about a date, greg, i think because they didnt want to change the markets existing view of the date. And well see over the next couple months whos right about that. Yeah, exactly. Thanks, guys. Going in opposite directions, where home prices are rising faster than wages, a lot faster, and where thats pricing people out of homes. What this means for the economy and markets is next. And new evidence, including a Facebook Post by the woman charged in the overdose death of a google executive has Police Taking a second look at a similar death by a man in georgia. That story and the hot list, just ahead. Youre driving along, having a perfectly nice day, when out of nowhere a pickup truck slams into your brand new car. One second it wasnt there and the next second. Boom youve had your first accident. Now you have to make your first claim. So you talk to your Insurance Company and. Boom youre blindsided for a second time. They wont give you enough money to replace your brand new car. Dont those people know youre already shaken up . Liberty mutuals new car replacement will pay for the entire value of your car plus depreciation. Call and for drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch to Liberty Mutual insurance and you could save up to 423 dollars. Call Liberty Mutual for a free quote today at see Car Insurance in a whole new light. Liberty mutual insurance. Welcome back. A new report today is not good news for the housing industry, and at the same time, a sobering look at the state of the economy. With details, were joined by our own diana olick. Diana, whats going on . Reporter well, kelly, its kind of confusing. Look, Mortgage Rates are still attractive, home price gains are easing, and the job picture is improving. So, why arent more people buying houses . Well, because a lot of people still cant afford houses. Despite the slowdown in home price gains, 97 of 100 metro Housing Markets surveyed by trulia showed yearoveryear price gains, and thats the most since the recovery began. Also, asking prices by sellers in june rose at their highest monthovermonth pace in 16 months. And wage increases are nowhere even close to keeping pace to any of that. Now, Real Estate Agents are now saying sellers are more out of touch than ever with what their buyers can stomach. In may, 40 of sellers surveyed by redfin, an online real estate site, said that they plan to list their homes above market value, even though home sales are down 9 year over year. Now, buyers today need down payments, good credit and a big enough income to qualify for that mortgage. Also, rents are rising. And another report eight of the top ten markets, renters are paying more than 43 of their income on their rent. Now, why do i pull 43 out of a hat . Because that is the loan debt limit that mortgage lenders will allow to give you a mortgage. You cant have above 43 to get a loan, but apparently, a lot of folks are paying a lot more that be than that on their rent. More at cnbc. Realtycheck. Com. And lets talk more with the panel. John, what do you make of this . I think right now, again, the jobs being created are very lowwage jobs. We dont have a lot of highwage jobs being created, and i think that the fact that were bantering about, about the minimum wage, you know, moving the minimum wage from, you know, a dollar here per state, it obviously varies, but thats not going to help people buy a home. I think the only thing thats going to help people buy a home is, obviously, good credit, right, a decent down payment, and also the fact that they have the foresight to say, you know what, im paying 5,000 for a twobedroom and i can have a 500,000 house. This is the disconnect ive been harping on forever. You know this, kelly, between wall street and main street. And for the average person on main street, they havent been able to save up enough money to be able to make that down payment on a new home. Their wages arent growing. So, this becomes a really big challenge for them. And a lot of people arent feeling desperate anymore, so theyre going to wait. Theyre not going to feel the need to sell their home at a loss, so youre going to have a disconnect. Is it good in the longterm, dr. J. , for this to be more we are told repeatedly, especially during the housing boom last time around, back in the good old days, it was hard to get a house, you had to save up for 20 years and things should be more like that. Sounds like it is now. Its going towards that. And unfortunately, many folks, as we push towards 68 and 70 home ownership, now were falling back to the low 60s. That, unfortunately, is going to be more stable, but in the short term, its bad for the people that carols talking about that cant afford it. But i dont think its unfortunate. I think that part of the reason were in this issue is because we had the government out there selling that American Dream that everybody needed to own a house, you needed to own one now and you needed to own one that was as big as your neighbors, and i think its getting back to basics, to responsibility, to saving up and being able to not only afford the house when you buy it, but to be able to maintain it, but its not just the onetime purchase. You have to put money into the house to maintain it and pay the property taxes. I think the discipline is a good thing. Diana . But even for those who have wanted to move up in a house. I mean, we talk about the firsttime home buyers a lot being sidelined, as you said, not being able to get that down payment, not being able to save enough, but a crucial part of this market is also that moveup buyer. And im not talking about the mul multimillion dollar buyer. Im talking about somebody moving up from say a 200,000 home to a 400,000 home. The problem is not so much the negative equity that everybody screams about, its that near negative equity. Its that you dont have 20 in your house as it stands now in order to put a down payment on a new house, pay the brokers fee, cover the moving costs. So, you have this large segment of the population who might want to move up, fuel those home sales who are stuck in place. Restrained go figure. Restraints. But also a lot of firsttime buyers. Sarah, when are you going to buy a house . Im not no plans in the near future. But exactly. I pay exorbitant rent here in new york city. Exorbitant rent, there you go. Because youre not married. Because marriage and children are the trigger. Thats why. Elwewell, at least im not lg with my parents, diana. Im just saying. Well, theres that. Because you have a job. Theres the cost of upgrading your home and spending on your home. Lumber liquidators today crashed, down 20 . Home depot and some of the others were falling in sympathy. That could be a good indication, too. Yeah, as to whats really going on out there. Its demographic change and not just whats happening with the financial crisis. Diana, thank you, for now. Up next, todays selloff tops the cnbc. Com hot list. The rest reads more like a police blotter. The details are next. Tomorrow, Twentieth Century fox looking to ignite hollywoods falling box office with dawn of planet of the apes. Can the monkeys that take over the world save hollywood . The Box Office Preview tomorrow on the closing bell. Welcome back. We got a market flashl. Lets head back to cnbc head quarters. We got a moverful water going on . More data coming up on the consumer here. This time on the rentacenter. The biggest renttoown operator. This company is preannouncing earnings and sales. Sales coming in at 773 million versus stills for 776 million. Earnings per share come up to 36 or 38 cents a share following short of 48 cent estimate on wall street. The companys ceo did Say Something interesting in the release saying that macroeconomic pressures continue to burden our financially constrained customer, continuing to soften demand in the business segments. The Second Quarter will not meet expectations. They did mention something interesting. This is something that programs tells you a little more about the industry as an overall i guess commentary. They are entering the renttoown Smartphone Market as well. So again, their numbers may not be coming in with stills. They are getting to another line of business, in this case here, the renttoown smart business, kelly. Back over to you. Wow, i will ponder that a second. Thank you. When sizeing up cnbc. Com. Hot list alan was ler put his prime hat on. Water going on . First of all, before we get to crime the big theme of the day of course has been market. Right now we are leading with a Market Analysis by our market editor she is looking at the selloff, it was dramatic. We came back from it. She said it might mask the real problem pros are looking at, which is the upcoming earnings season. She digs into the numbers. Our readers are jumping in there with her. No. 2, its more about that story i told you about yesterday the prostitute bo allegedly killed a google executive on his yacht with an overdose of heroin. Apparently, prosecutors in california are looking at our internet use after that event. She is apparently looking up legal defenses, allegedly, and in georgia, theyre looking at her involvement in another heroin death. So the plot gets thicker. Its a kind of a tabloidy story. People are interesting. Number three, first to buy legal pot in washington state, mike boyar, he got fired fwaufs on tv. Hes there, hey, i bought the first legal pot apparently, he works as a Security Guard and clients with the Security Firm have a problem with somebody rocking the gunge who might be protecting here stuff. He got fired. I understand you will have a discussion with him tomorrow, if im not mistaken . I think i have learned this myself as well. So stay tuned, everybody. Its a story our readers are loving right now. Allen, thank you. Good to see you this afternoon. Its been a rough week, three of the four down day, can the bulls end on a winning note tomorrow . The panel will tell us what theyre watching when we come right back. During the cadillac summers best event, lease this 2014 ats for around 299 a month and make this the summer of style. water dripping and dont juspipes clanging ncisco. Visit tripadvisor san francisco. soothing sound of a shower with millions of reviews, tripadvisor makes any destination better. If yand youre talking toevere rheuyour rheumatologistike me, about a biologic. This is humira. This is humira helping to relieve my pain. This is humira helping me lay the groundwork. This is humira helping to protect my joints from further damage. Doctors have been prescribing humira for ten years. Humira works by targeting and helping to block a specific source of inflammation that contributes to ra symptoms. Humira is proven to help relieve pain and stop further joint damage in many adults. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. Blood, liver and nervous system problems, serious allergic reactions, and new or worsening Heart Failure have occurred. Before starting humira, your doctor should test you for tb. Ask your doctor if you live in or have been to a region where certain fungal infections are common. Tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. You should not start humira if you have any kind of infection. Take the next step. Talk to your doctor. This is humira at work. Welcome back. Lets get final thoughts. Tomorrow we have dr. Wells fargo reporting. A huge outperformer. Theyre up 14 yeartodate. Crushed the other banks. You have Goldman Sachs and city next week and j. P. Morgan and intellianya hoo on tuesday. A lot coming our way throughout the early part of next week. You seem to like pnc with our guests earlier, what did you think about the bigger banks . I liked the regionals, except for wells. Theyre so well run i think wells fargo is one you stick with. Doesnt this go to the point about consumer credit, the rentacenter hit after hours . Im looking at the barbell economy and thinking the bottom weight may fallen off the bar. Im going to be looking at these companies servicing the Lower Consumer and seeing water happening with them. Sar remarks what are you watching . Janet yellin will be speaking next week. I think it will be interesting to watch how europe opposite, obviously very important. So watching some of the data out of europe and also some of those banks trades. I mean, they got hit across the board. Deutsche bank, we were talking about this earlier. As we assess whats happening in portugal. Just to read you a line in barclays here, they say these two, finding themselves with large placements of paper, looking increasingly unlikely to play. They are under a program until two months ago. A lot of people are wondering why this wasnt dealt with sooner and a lot of people are looking at Deutsche Bank and the financials. I think Stifel Nicolaus again, they havent raised a lot of capital. They sold some assets to raise capital, they actually havent raised a lot of capital, itself. So, again the banks if europe are hand strung because they are the only Financing Mechanism for the corporations. He knows that. Thats why draghi basically said, we will give you as much money as you need as long as you need it to unlock that. He unlocks that credibility . They do kwul qe, bed type qe. Again tonight i think china like you said earlier, china didnt react too much to the bad data they put out themselves. Japan, obviously, orders are very poor. That was a big miss. Thanks to the man around the world. Exactly. That was odd. That could be First Quarter layovers as well. Its not just machine sales. The entire economy there, some people seem to for some reason think we will be on the up and up, with the aging population, i think thats one to keep your eye on as well. Next week on wednesday, we get young brands because they get their sales. After dr. J. , dr. Copper. This is the one im keeping coming back to. You are right, its a 30 rally since june. Its the one place you expect to see weakness and yet you are not. It was all what the bears were focused on was copper. This is proof that the market is going to be falling apart. Today it was portugalful all they could really do is get the market teatering towards 1 . As soon as we got there, it came back, took back half of that. We havent seen that 1 move. They need to man up . It was a selloff. We got to go. What are you going to watch for the next couple of trading sessions just to know how resilient this market is . Again, we are looking at 1916, thats the pivot level we are watching. We are watching again the yen. The yen tried to break but it didnt. We are watching portugal tomorrow to see if they break amove 34 in their ten year, which has been very good resistance. Great stuff. As we talk through all this fast money coming up in a few minutes, melissa lee. Wells fargo is reporting tomorrow, we got a top analyst who says four of the major banks are dead money right now. Well name names at 5 00. All right. Over to you. Fast money starts right now. New york citys times square, ill melissa lee. Your traders are tim moore, steve grasso, a whipsaw day on the street. Fears of contagion over portugal causing a sea of red. The markets end of the day recouping much of those losses, a solid reversal into the afternoon. Small caps industrials and financials what happens to the selloff . Tim seymour . I tell you what, to me, it was less about portugal than positioning. Yes, a catalyst, yes, still something on peoples mind. Complacency. I think we talked about it plenty of time with the lack of volatility in these ma