Transcripts For CNBC Closing Bell 20140814

And. And were going to get another good snapshot of the retail world in about at hon when j. C. Penney and nordstrom both report. J. C. Penneys continue toss bite out from the very deep hole it dug for itself. With an hour to go in markets, the Dow Jones Industrial average up about 49 points this hour, the s p adding about seven, the knead dab is up 14. Were keeping a close eye on the rate space. Watching oil, scott, looking for whats driving, what is the catalyst in this market. Joins us now, steve crawl, cnbc contributors Heather Hughes and great, and todd saldoni, and yes, of course our own rick santelli. Whether its iraq. Well, the good news about that is its going to force Interest Rates to the fed can only do one and do at the most, and so youre going to force investors to put money into stocks, bonds and junk bonds. In light of whats happened, especially . Germany, flirting with a 1 mark, you think that tenyear rate could go . And probably the key is it will probably stay below 250. You see retail sales, you see china, japan, as scott mentioned, all the other bad spots, so theres really a lot of dollars out there, and very little demand for that. But you think thats a good thing for stocks. Why . Eventually. When you put your money in the bank and it sits there, last year the market was up 30 , and now were about flat on the year. It forces people to look for good stories. Not necessarily were going to have a great bull market. As i said probably year end well be up 3, but people will chase yield and assets. If rates go below 2 , as steve says they might, that as you see it, is the u. S. Economy Getting Better . Or is it getting worse . Well, i think its Getting Better, which makes it that much more of a puzzle to explain i think you have a decoupling. Weve had good Economic News and acceleration, topline growth for u. S. Corporates. At the same time, the bad news in europe, and lets not forget japan, they had a terrible Second Quarter excuse me, they had a terrible Second Quarter in the calendar 2014, and increasing the sort of flight to quality and downward pressure on global bond yields. I see a world where theyre pulling down longterm rates, even as good domestic news provides fundamental supports for stocks. Against the backdrop of the tenyear, the 30year went up 3. 2 , rick you heard what greg just said, decoupling, the fact these rates are so low doesnt have to be bad news for the stock market. Do you believe it . No, i think its the only reason. A baby a years old will be growing, but not going to be dunking a basketball net anytime soon. Certainly were growing, but not growing very tall. Flash points, you know, i understand the human element, but i think the flat points that the markets pay more attention to in treasuries are a debt, horrible tax policy, horrible immigration policy, horrible political factions that cant get anything done. Those are really the flash points, but theyre difficult, and nobody seems to be able to iron them out. So the geopolitics is an easy fit to put in the puzzle. I think whats going on with europe really exemplifies that. You look at italys gdp, frances gdp, germanys theyve been there done it, just like theyve had 4 and weve had negative numbers. In the end the Interest Rate complex is spot on, but it isnt a positive story. Were positively better than everybody else, but nowhere near as tall as we should be standing. So, todd, given what rick just said, how are you able to remain as bullish as you apparently are about u. S. Stocks . Its the price action. Yet the mark still is only a few Percentage Points off its high, yet in the context of this, we are seeing a ton of caution out there. Bank of america, Merrill Lynch surveyed global fund manager, they just raised cash positions that were 5 , which historically has been bullish. You look in the options market, its unbelievable, even though we just had a pullback like every over pullback weve seen, we saw a huge surge in bets against individual stocks, via put options, relative to the call options. The highest level in fact since june 2012. Look at Short Interest on s p 500 component names. Against bets gentz answer individual stock, its up 25 since the april 12 low, yesterday the s p is up 40 . A ton of portfolio but todd in response for the flash ploints. Todd, heres what im wondering, though, this is one of the most hated but im seeing if we do have periods of corrections, they may be happening within each sector and not just from the Broader Market perspective. Do you think that could be the new standard correction . On you do you think it would be a brought Market Correction . Sure, as you mentioned, we have seen these corrections, most recently you call it small caps, or the russell 2000 by about 10 , or it can be individual sectors. We saw biotech and social networking stocks take a hit. So i think we do have vulnerable within sectors, but broad are marketwise, i think were in a good position. Corporate profits up 9 , 1. 7 trillion cash still sitting on the sidelines, but the question is we are on light volume, and the Retail Investor im hearing at the end of the day is still on the sidelines since 2009 even. I think the Institutional Investor may be in the drivers seat right now. They could be, because they just raised a ton of cash this past month. Lets hear from steve. The Retail Investor that represents future buying power. Steve . Years ago, when people expected a market crash, you can put your money in money market nowadays you get nothing. Time and price will price and then well see but right now the market is acting much better than i would have expected and holding in there, as you get these group corrections. All negative things that you mentioned. And we are growing, a bit better than expected. Thats going to stop abruptly and people will come into the jung bond market, and thats what the retirement people want. Well leave it there for now. A quick last word, heather . I guess in order to have a second half recovery for real Economic Prosperity we need wage growth. That would be the key drivers going forward. If we dont get that it will be a long time before the fed takes the punch bowl away. As if anybody believes theyll take it away anytime soon. I know. And well very velocity and inflation, and then janet yellen will be pulling her hair out. Im happy you got the last word, guys, thanks. Some of the big movers for us. Biotech has been outperforming the Broader Markets. Thats up about 1 today. Adding for the gains, up more than 3 so far this week. Amgen is up more than 3 today, after investors shall rugged off disappointing results for the blood cancer treatment. Also getting a fights. Gillia, regen ron, vertex and bioagain, in fact the only big both tech thats not trading. Taz about flag. Analysts tell me biotechs are on the move because of an overall good earnings season. We have about 50 minutes to go before the bell rings. The dow holding on to a pretty decent gain. Thats a third of a percent. Now, going back to an issue we were just discussing, the u. S. Versus europe. Which is the better place for investors right now . Dom chu and seema mody will go head to head in a classic closing bell debate. Also walmart slashing guidance because of sliding store in the United States. What they need to do to win shopper back. The state of the consumer, when, instant analysis and reaction to those numbers coming up. Keep it right here. Having the cloud allows us to rapid prototype a lot of ideas. Being able to pay as we go was crucial for a start up. Having to fork out a lot of money up front was risky. You can launch a feature really quick, and if the feature doesnt work, we havent lost anything and we can have something up and running in days. And this would not be possible without the cloud. We are now supporting over 25 million users each month. Ideas can be tried and tried again on the ibm cloud. The ibm cloud is the cloud for business. Were changing the way we do business, with startup ny. Weve created tax free zones throughout the state. And startup ny companies will be investing hundreds of millions of dollars in jobs and infrastructure. Thanks to startup ny, businesses can operate tax free for 10 years. No property tax. No business tax. And no sales tax. Which means more growth for your business, and more jobs. Its not just business as usual. See how new york can help your business grow, at startup. Ny. Gov sglooz home depot, some of the biotech names, and amgen, and even marriott, scott, at record highs at some point in the session. Another quarter, another decline for walmart. Cord any raining looking at how thats impacting the bottom line. You know what, could have been worse. Second quarter earning of 1. 21, revenue of 120. 1 billion. Beaten won sense. Coming in flat for the quarter. Ing the result traffic only 1. 1 , increased by the same amount. From 510 to 545 to 490515. And its because of Higher Health carry costs, that we saw that lower guidance. The company had originally estimated 330 millions, and it calls on ecommerce as it continued strong point lowering expecting comps for the current quarter. Thats certainly challenging. What is wrong as walmart . Are the u. S. Stores up to snuff . Is it no longer a good experience . Joining us is laura hefner, and pete lang. Welcome to you both. Laura, is it one thing . Is it many things ailing walmart . Its many things. Its no secret that the store experience isnt what walmart executives watch it to be, and theres a growing chorus of shoppers that are pretty dissatisfied with that, but it doesnt mean its not fixable. Thats exactly the question, which is if i am running walmart, do i say we have to do a massive Investment Program in our stores and hope shareholders bear with us and this will bear fruit . Is it even clear what that strategy should be . They are the ticket for growth. The shopper hayes changed the supercenters are not in demand as they used to be. Theyre not building anymore, or very few, but they have 3300plus existing supercenters, theyre not going to sit there and let them fall fallow. A im walmart, costco, maybe my biggest problem is amazon, and theres not anything i can do about it, dirty store or otherwise. I agree. When you look at the good. Dp numbers, theyre just not growing. Is it the case, an am sop prime is paying 79 or 99 a year, is that who walmart is losing share to . But in walmarts case, is it still the enter net phenomenon . Absolutely not. When you look at walmart, youre looking at domestic sales of 500 billion. Ecommerce are only about 10 billion, nevertheless up about 25 , so thats a great growth area for walmart, but really not a competitor with amazon at this point in time. In the future well see them grow exponentially, especially with greg penner as vice chair on the board. Laura, you were going to disagree with pete, right . Actually i kind of agree. I dontening that amazon is walmarts biggest competitor right now. It is the economy, it is a pressure chopper, and the dollar store segment is their toughest competitor at the moment. Theyre implementing services and programs to better serve that customer, but in the short term, its not amazon. If you had dont have to go to the physical store, why bother . Why bother dealing with a store thats more liquiditiered . Why bother dealing with the Customer Service that may not be up to par . Why bother with enough it . How can those stores possibly fix that mindset . Thats a small percentage of the population. 97 of people are still shopping in stores. Absolutely. I agree 100 . Im just curious, if thats the case, not long ago we were talking about the Dollar Stores and whether their strong run had come to an end. Are they and walmart suffering from the same thing . Is the pie just shrinking so much there are no winners at all in that space . Pete . I dont think so. I think were going to see up kicks in demand. Im not really worried about walmarts stock price because of phenomenal buyback, 16 billion buyback program. In the First Quarter they had about 650 billion worth of stock that was repurchased im sorry, million. And as far as demand, well see it remain static until about 12022, and then youll see some upkicks in domestic demand. Having said that, the challenge for walmart is going to be growing internationally as well as from the ecommerce position. Did you say 2022 . I think were really going to see some fundamental changes based on the baby boomers. A lot of whats happening with so many baby boomers. Its fascinating. I wanted to make sure i heard that right. Thats a long time. You have to hold on. Thats eight years. Basically thats when were going to see some demographic changes in the population base. Whats happening in our population is the elderly or retires are deaccumulating, not accumulating. Thats really bringing down our gdp and retail sales, but 2022, well see a huge shift in that momentum, but walmart os got some great opportunity again overseas, great opportunity with these small store segments and also with ecommerce. He can really push the numbers there. Thats fascinating. Thank you. A broader look, perhaps at whatsation retail more broadly. Bye, guys. 40 minutes to go. The dow is up 53 points, seven on the shares of red robin plunging on a big earnings miss as fewer people visited the restaurants. Thats on the heels of walmarts instore traffic declines. Are they canaries in the coal mine when it comes to the health of the consumer and the economy . That is next. And the worst idea since new coke. Thats what somebody here is saying about a new push to ease prison sentences for white collar criminals. Well hear both sides of that debate. Plus dont miss your chance to weigh in at cnbc. Com vote. Wg faster than ever, we believe outshining the competition tomorrow requires 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. 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There it is, the dow is up 55 points, s p 1953, kelly, seven points. And lets get a check on some of the big movers with dominic chu. Hey, it seems like such a long time ago we had all that turmoil. Lets stark with berkshire hathaway. Class a shares are moufg up above 200 for the first time ever. A nice sticker shock price, it is perigo, this is a maker of overthecounter branded drugs, and you can see those shares up 7 at session highs right now. Muling genetics is gaining ground after its theyre ready to testing a possible human obowla vaccine. And well cap things off with red robin after it plummeted the surprise drop. Red robin shares off that session low. Back over to you guys. And were going to pick up right there, dom. Are red robins problems symptomatic of larger problems . Joining us to discuss that is john herman, director of Interest Rates sales and trading at mitts beneficiaryu ufj securities. Greg greenburg, to you first, what do you think . Emblematic of something bigger . I think this is a red robin issue. When you look at some of the restaurant stocks, theyre trading like team retailers, but in the industry you have to be the flavor of the month and peoples tastes changes. Everybody is looking at which i pot lace, so its not easy being in the restaurant chase, and in an era where you have beef prices rising and every restaurant around is giving away free appetizers. The competition is unbelievable. I cant even think of the number of burger joints there are, including one called burger joint. Yeah, there are some. Greg, i love your line, theyre the new teen retailers. Ouch. You have to be on target all the time. Sales did rise at red robin. It wasnt all together a massively horrible quarter. They missed wall street about 22 cents, but street numbers come and go. But you know, its tough when beef prices are rising. I think about 9 or 10 of the shares are sold short, so you cant read too much into any Quarterly Earnings report. John, that is the question we would like you to address more broadly, which is having a slew of misses on the food side, the retail sigh and also the weak retail sales report for july, whats going on here . How disappointing has this trend been . I think we shouldnt get too overly pessimistic. The key thing is here on the cyclical side, the economy is really still in a pretty debt recovery. The jolts index, job openings bakley at a sevenyear high, jobless claims, payroll will be averaging 220,000 per month this year. Very decent, best since 1999. I wouldnt really get too pessimistic on anything. I think Fourth Quarter, what were looking for, much stronger quarter for consumer spending. We think the Seasonal Hiring will be very, very good this year for the Fourth Quarter, very strong spending as well in that quarter. I think in general, the kind of points you are emphasizing, this inconsistency quarter to quarter, month to month, i think theres a few things at play there. I think several of them are structural in nature. I think we have the ability as a country to sort of solve a lot of these things. One simple solution would be basically to really amp up the h 1 b visa program, bring in a lot of really talented smart, energetic young people, very welleducated young people, get them working. Theres tons of jobs openings for them. This thing would get going. John, correct me if im wrong. I thought one of the bright spots witness retail was restaurants, that people are still spending money at restaurants, but its become much more competitive. Its become much more selective and price sensitive, and there would be clear haves and havenots, and red robin, perhaps, is an example of at least right now, even though sales as has been pointed out, is up, may is a havenot in the cycle. I would definitely agree with that. When you look at the consumer side, you see from all the different demographics, youre seeing people going to restaurants with greater frequency. Thats the luxury they are availing themselves of. When we look past it, again were looking for really solid quarter. In the Fourth Quarter for consumer spending, i think what we need to see, though, wed like to see in this age bracket from, say, 25 to 39, in that age bracket, were seeing it slowly recover. It kind of went through a bust between 2005, and 2012, 2013, its recover now, will take about another 15 years or so to get back to the baby boomer peak, but we can step that up. We need that sweet spot for spending, whether its on here i thought 2022 was a longterm outlook. Greg, weve got to leave it there, but can a company like red robin and to hang on . Sure, they can come back. You look at some of the other burger players, sonic, those burger joints are doing final. Just thanks, guys. Ill second the smash burger thing. 30 minutes to go, and we have half an hour to go. Scott, i cant hear you. Can you hear me now . Now i can. Yes. Stocks turned around early this morning. After Vladimir Putin easing his tough talk over ukraine. Why on earth should investors believe anything he says. Could Kinder Morgan spark a wave of mergers . The Top Executive of Tortoise Capital partners, which runs several pipeline funds, weighs in next. Rch reports, customizable charts, powerful screening tools, and guaranteed 1second trades. And at the center of it all is a surprisingly low price just 7. 95. In fact, fidelity gives you lower trade commissions than schwab, td ameritrade, and etrade. Im monica santiago of fidelity investments, and low fees and commissions are another reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Tdd 18003452550 life inspires your trading. Tdd 18003452550 where others see fads. Tdd 18003452550. 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Pick a tie. Take a break with mr. Duck. Practice up for the business trip. Fly to florida. Win an award. Close a deal. Hire an intern. And still have time to spare. Go to comcastbusiness. Com checkyourspeed if we cant offer faster speeds or save you money well give you 150. Comcast business. Built for business. The dow is up about 16 points. Same goes for the s p 500, which is now pretty much at that intraday high as well, on one of the best weeks weve had, as scott mentioned in quite some time. Now, Master Limited partnerships, mlps as theyre known, have been in the news this week on the heels of the Kinder Morgan consolidation deal. Today at a time when some are questioning the future of this asset class. Joining us now in a first on cnbc interview is managing director of tortoise welcome. Thank you for having me. Its only a decade for this to be something of a household name. What can you think of the news on kinder this week . It was a surprising move, because the space has been going the other direction, putting more assets into the mlp class, rather than putting but it was something that was a unique fit for the situation they were in, looking to reduce their cost to capital. Is that something that would be an issue for the other guys in the future. We think its fairly unique to Kinder Morgan. Theyve had a lot of success raising their dividend. So unique to them. Never say never, but generally speaking, we think the trend will continue to be more assets moving into the mlp space rather than, you know, out. They may, matthew, be doing this, and i think Richard Kinder even mentioned this. I cant hear him. Why dont you go ahead, kelly. Were work on that for a second. You handle it down there. Youre good. Weve been having technical issues. Le met judd ask, as people are wonder, whether you can see season but also if theres pressure from washington, i understand that a lot of republicans may maybe gains in the mid terms that could protect the existence of this kind of structure, but there has been pushback about anything that lowers the tax bills, whether its inverting or outvertebraing. What is your response . The first question is on the sustainable. You have about a 5 payout, and those dividends are growing, call it 6 to 8 goods forward. We have good visibility into that growth continuing, so not just a question of sustainable, but growth, and theres a lot of visibility. Theres a tres amount being built to mean the demands from the producing community. Thats what raises the second issue, which is as more of this compare comes on and this asset class grows, is the u. S. Treasury going to lose out, because its being funneled to investors. Great questions, we get that one a lot. The trend has been to make more things qualifying income rather than less. Recently senator kuhn has proposed the parity act which would make renewal assets, so between that and the i. R. S. Issues a lot of private letter rulings, again to make more sources of income qualifying for mlps rather than less, we feel pretty confident that the mlp tax status will remain intact. Last question, then, how big has this asset class become . How much retail participate . What can you just tell you about this asset class today . So tortoise brought the first mlpdedicated fund, the space was about 50 billion of market cap. Roll the tape forward to today, its almost 600 billion, so a tremendous growth in the space, again because of the need for infrastructure, and the demand from investors to have a good current income in this low Interest Rate environment, and one thats protected when Interest Rates do move up. So youre protected from Interest Rate risk as well. And the environmental and safety factors associated with pipe loons having me lines having amealated to some extent, but what about pipelines and the extent to which, as more fuel is moving and gas is moving this way, how do investors deal with those risks. As far as Pipeline Transportation its the safest way to move Energy Around our country. We spend a lot of time talking to our management teams to understand what theyre doing from a maintenance of their pipeline standpoint, to ensure theyre spending proper capital. We track publicly available statistics, and rates of pipeline leakage have been actually declining over time. So, the space is growing a lot, but we feel very good about, you know, maintenance, and that its sufficiently being done. Adespite your name, you guys were certainly ahead of the curve. I was going to try to make a rabbit pun there, but you jumpeded ahead of this asset class, now 600 billion. Congratulations, our precious as well, as we keep an eye on this space as it growing quite significantly. Thank you so much for being here. Thank you so much for having us. Weve got about 20 minutes to go before the closing bell which youll see tortoise ringing here. Scott . Impressive. European stocking have dramatically underperformed the s p 500, so there is a value there now, or still better off investing here in the United States . Dom chu and seema mody, theyre going to debate it, next. And what are big investors buying and selling these days . The disclosure filing deadline is moments away. Were starting to get the market moving news already. Much more of that will be coming up. Keep it right here. Youre watching krmt nbc, first in business worldwide. Im only in my 60s. Ive got a nice long life ahead. Big plans. So when i found out medicare doesnt pay all my medical expenses, i looked at my options. Then i got a Medicare Supplement insurance plan. 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So we found a plan that can travel with us. Anywhere in the country. [ male announcer ] join the millions of people who have already enrolled in the only Medicare Supplement insurance plans endorsed by aarp, an Organization Serving the needs of people 50 and over for generations. Remember, all Medicare Supplement insurance plans help cover what medicare doesnt pay. And could save you in outofpocket medical costs. Call now to request your free decision guide. And learn more about the kinds of plans that will be here for you now and down the road. I have a lifetime of experience. So i know how important that is. Welcome back. Its the return of the closing bell royal rumble. Today the u. S. Versus europe. Dom chu says u. S. Markets are the place to be, bus seema mody says theres more valuable across the pond. Take it away. Here we go. Im going first. All right. Go first. I know at first glance it doesnt look that appealing, slowing growth. We got those numbers overnight, but some market strategists say hey, europe has a supportive Monetary Policy thats aimed at stimulating the economy, and in a bold move, mario drawingi introduced negative Interest Rates to push banks to loan more money. That will continue until europe sees better days. Second reason you might want to stay bullish is on earnings. And on average. 350 stock index are forecasted to show 8. 5 jump in earnings this year. That, by the way, guys, higher than the average for companies in the u. S. , companies on the s p 500, so clearly disappointing data over the past couple weeks, but estimates for earnings still higher. Heres what i got in responsible to that, yes, maybe negative Interest Rates are a big deal, but lets not kid ourselves here. The u. S. Federal reserve still has accommodative Monetary Policy here. They both do. So well call that maybe a watch. What i would say in response is where would you want to be in the proexis gross domestic product, the measure of economic output. Things are looking shaky right now. Maybe in the u. S. Things dont look great, but we are still growing, and corporate earnings are gruing as well, as you look at whats happening around the world, you have italy slipping into recession german business confidences coming down because of the russia and ucrepe. I would just say this, you throw more geopolitical risk into the mix, and one play people go, when everybody else goes all haywire is in the u. S. Markets. The u. S. Treasury market, so even if Global Equities go down across the board, the u. S. Will outperform, because it is in the world of many strait gists, the cleanest dirty shirt in the hamper. Is that growth already priced in . The germany dax down 8 , the cac is down about 8 as well. Does that create a buying opportunity . I would just say, scott, kelly, that the s p 500 trades at a discount valuation. Pretty much in line. We should have had people vote on this one. I can see that coming up. I can see that coming up soon. We should have had that. Why didnt you tell us . I think its u. S. Im just saying. I hear people say theres no value in europe, i mean, obviously, but the potential of many more problems, too, if you look at what the data has been lately, whether its france, germany, italy or elsewhere, you have to be a bit worried or nervous if youre putting money into the european markets, or you think its a great opportunity, because they have sold off. Right, exactly. Who knows. Isnt there a chinese proverb, something along those lines. Prices, opportunities yeah, thats the one. Exactly. It could change, of course. Thanks, guys. We have about 15 minutes or so before the closing bell rings, the Dow Jones Industrial average hanging on to a gain of more than 51 points. Again, stocks are working on the best week in six. Its been a pretty good run, at least this week. It may have something to do with russian president Vladimir Putin cooling off rhetoric over ukraine. Investors seem to like what they hear, sending stocks higher, but putin has a history of saying one thing and doing another. Are investors making a being mistake by trusting him this time . That is coming up on closing bell. At managing my symptoms, except that managing my symptoms was all i was doing. When i finally told my doctor, he said my crohns was not under control. He said humira is for adults like me who have tried other medications but still experience the symptoms of moderate to severe crohns disease. And that in clinical studies, the majority of patients on humira saw significant symptom relief. And many achieved remission. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal infections and cancers, including lymphoma, have happened; as have blood, liver, and nervous system problems, serious allergic reactions, and new or worsening heart failure. Before treatment, get tested for tb. Tell your doctor if youve been to areas where certain fungal infections are common, and if youve had tb, hepatitis b, are prone to infections, or have flulike symptoms or sores. Dont start humira if you have an infection. If youre still just managing your symptoms, ask your gastroenterologist about humira. With humira, remission is possible. So i can reach ally bank 24 7, but there are24 7branches . Its just im a little reluctant to try new things. Whats wrong with trying new things . Feel that in your muscles . Yeah. I do. Try a new way to bank, where no branches equals great rates. Theres your market picture, the dow has been in a tight range for at least the last hour. Despite the fact there are flashpoints of concern, but thats the picture as it assistants. Jeremy hit from old black heap and rich peterson. You know, you go down the laundry list of all these works, and the market doesnt seem to care about any of it. Maybe the only thing out there that really is of great concern is the fed and what it ultimately does, how it does it and when it does it. Yeah, thats definitely the largest risk. Thats the 900pound gorilla in the room. I mean, its fed policy mismatch. Certainly geo i think its going to damp down a bit. I think were going to be a range, because we havent reacted very well to a pretty good earnings season so far. In any case, how much let me previous by saying that the markets are shrugging off geopolitics. Falling the propelling equity. On the s p, now were closer to 2000, than to 1900. Gin, retail were going to work that through. We havent so rich, real quick, just to be clear, for the Second Quarter, where do we assistant . Were more than halfway through the Third Quarter. When we come down from the sxekdations, but again, two qs, over 90 of the companies have reported. All thats going to be coming back with the back to school period. I think were going to let you go. We have a developing Story World Trade Center to get on the air right now and see if the market reacts to news that the iraqi minister al mall can i, apparently is stepping down. I dont have a whole lot of information in front of me here. There was clearly a new Prime Minister was named there was some thought he would fight to the end and not leave, which would have a whole bunch of ramifications, potentially on the oil market, but certainly the situation within iraq, if there was going to be a civil war in iraq, as were already dealing with a developing situation of ref giles and isis, and im told that john harwood is ready. John, this is a Significant Development . The second piece of good news, the obama administration, scott in the last 24 hours, the first was that they do not need to send troops to break the siege of those refugees in iraq, but this is something that the Administration Heart arguing is a precondition for a solution that, instead of a military solution, politically what you have you have to is a and neuroty al maam i can i had not do that. The. Nuri al malaki had not done that, and the hope is the new government will if thats the case, it would go a long way to resolving or eliminating the threat from isis, but all we know is iraqi state tv has flashed a banner saying that Nuri Al Malaki has resigned. He has not spoken on tv yet. A more unified situation in iraq would take some of the onus off the president and thus our own involvement there as well. Correct . Thats pretty much what youre saying here, correct . Yes, thats exactly what im saying. Okay. John, thanks. Up next, were back with the closing countdown. 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Because theres no other place to put money, the United States is the best Investment Vehicle if you want to be in the stock market right now. Today we saw disappointing the trend has been down for more than a month, thats certainly very, very worrisome, we have seen the market move on ukraine. Believe it or not, it moved preopen, with Vladimir Putin speaking in ukraine, speaking in yalta saying he would do whatever he could to stop bloodshed. So we are moving on economic numbers related to the United States, and moving on some numbers related to europe. Just amazing when you see moves around the rates. Even a prediction from a gentleman on the show this hour, that you could go below 2 on the tenyear. Were at 2. 4 , new lows on the tenyear, on the yield on the tenyear, german bund did go below 1 . We have not seen that in 200 years, scott. Bob, thanks so much. That does it for ugh. The next hour begins now. Thank you, scott, welcome to closing bell, were finishing up another day in the green for wall street. It looks like the Dow Jones Industrial average going out with a gain of about 61 points. That means its pretty much going out on a session high. The s p 500 meanwhile, adding more than 18 points, so it is back up above 1950, the nasdaq meanwhile, adding about 18 points, similar percentage gains, and about on. 4. Joining us today, as we await earnings from nordstrom and j. C. Penneys, jon najarian, and our own kayla tausche, and guy adami. Wake these markets up. I think last time we talked about being a pivot level for the s p, within a couple points, that proved to be the days. And weve bounced. The bounce is more robust than i thought it would be, but we bounced nonetheless. I will say this to you and have said it now for a long time. I think yields are going down. I know you have heard it all day long, ive been saying it for a while, you look at whats going on in germany. At some point that disconnect between interest investigates here and globally have to come home to roost, i think, in the equity market. A big theme of the market was money going into some j. C. Penneys after hours, we should know, those shares are moving higher, wow, to the tune of 10 trading yes bang i think dr. Jay has yeah, i got some of that today. Yeah. They crushed. I mean, this looks like a real beat, because revenue up big, as well as the bottom line there, theyre expecting to lose about a dollar, estimates were, and here they are coming occupy i believe at 78 cents. A phenomenal move by them. I was debating this one today at halftime. We wanted to get those full numbers before we totally dig into this. This comes in the back drop of a weaker report from macys, some highprofile misses in the retail space, raising the question as to whether theres a problem with u. S. Consumers or whether some are executing well in this environment and others are not. If youre j. C. Penney, it might be easier to surpass expectations here. I think our corti reagan is ready with the report. Thats right, kelly, as we look at j. C. Pen yes, sir areas earnings, a loss of 75 cents. Tess better than we expected. This is on revenue of 2. 8 billion. Better than expected. Same dr story sales up 6 , just a hair better than expectations. The company saying comparable samestore sales, for the Third Quarter, which was the same basic guidance they gave for this quarter, so it does look as mr. Al mans plan has stemmed the bleeding. Online sales of 16 points, 7 , thats a good number, but actually a bit of a slowdown. Kelly, as we get more, well bring it to you, but for right now, it looks pretty good. Courtney, thank you so much. Kayla, erin, some thoughts here . I think its interesting to see the fact that guidance is being upheld when, yes, j. C. Penney has gotten some flack for the fact it had so yes, when you get 6 , you can do that when youre samestore sales in the quarter a year ago, it wasnt that strong. So its been relatively easy, a low bar for them to clear. Unlike macys, j. C. Penneys ais saying this engine will continue for the rest of the year, which is an interesting sentiment. A question thought here, and then we have some guests to bring in as well. For me it was more about the guidance. It was a quarter for them to beat, all about going into the holiday season. Reflecting lets get some thoughts, welcome to you both. Mark, you are a big fan of j. C. Penneys, correct . Yes, i am. You know, i looked back seven years ago, they were do 10 less stores, and so the am of leverage you have, like they seem to be doing, from macys and these other places, you go into stores, you see it. This shows has huge potential. I think its the best turnaround story i have seen in a long time. No, this was a little better than expected. It looks like the beat was largely on the sales just a bit better. Sales are going to get tougher. As i said here last time, theyre going to have to grow a lot to grow into the valuation. If what youre saying, this is the best turn around you have seen in retail, theyre training about ten and change, where can it go from here if youre right . An, massively increases both your margins and Free Cash Flow. Its selling for so last time they guided for free breakeven Free Cash Flow, i dont know that they had anything about it, but if they hit that within a years, useal the stock, even a whiff of that, youll see the stock start to move dramatically. I estimate they could hit 200 to 300 million in Free Cash Flow win a year or so. We should mention the Free Cash Flow. Not a ton, but that is 1. 2 billion improvement from last year. Dr. Jay . I also like, when you see a big Short Interest like this one has, its gone from 5 00 and change all the way up through 10, pushing towards 11. People that are caught really adopt have very many ways to get out. And does look like in the statements, the first year guidance includes Free Cash Flow expected to be positive. Stand by, everybody. Now we have the other end of the per peck tiff. Eagerly awaiting this one. Kelly, it looks like nordstroms earnings coming in, a penny better than the street was looking for, which was 94 cents retch. Do a range of 3. 80 and 3. 90 that upped guidance is upped at least about five cents on that lower. As you can see about 1 higher right now. Up about 10 . Just made the point that if most names are we should note the company so my question is how does that not make this a 12 stock . It depends on how positive, kelly. Its going to take i still cant get a reasonable valuation with even these assumptions in the model until about 2018. Wow. I agree, even one quarter of cash flow, you really need to see multiple years of cash flows, they also dont offer dividends, in fact they increased their sharing. Its a nice value trace, you would agree . Illustrates i agree. What i am is a trader. I manage money for some folks, but this is risk capital here. So, in other words, i trade it, ive traded out most of it. Im happy about the pop, but im not saying it would be this in 2016 or that in 2018 as were all siding tess desk. Bravo. I heard what rick said, frankly positive Free Cash Flow. This is just incredible. Right now as of this quarter, what are they going to do next quarter . The point about Free Cash Flow is thats what pays down the debt. Like i pointed out before, with 1,000some stores, having done 20 billion in sales. In sales right now to, you know, 12, 13 billion, thats what you call operating leverage. In terms of the stock, if the market starts to calculate. With 300 million in Free Cash Flow, at 12 times multiple 3. 6 billion divided by the shares, you get a 12 stock, minimum. J. C. Penneys is at nine times book value. Just the slightest whiff of reducing the debt gets you to a twotimes lets get rick and guy in here before we let everybody go. Respond to that, if you would. Im liking at it on ebit to ebitda. I cannot get a reasonable valuation unit 2018. I do disagree its all about sale, its all about gross profit dollars. It looks like j. C. Penney picked up a lot of that. And guy adami yo im going to wrap it. Im going to put a ribbon on it for you. I cant spell ebitda. What i will say about j. C. Penney is the quarters will be lumpy, but now shorts have gotten scalded a couple times. Theyll be reticent to put on a short again, which leads thats 12, 12 1 2, 13, i dont know, but youre not going to see anybody playing this from the short side. Well done, doc. All right. Thank you, sir. Well down with the ribbon on it. To the tune of about 8 after hours. Well leave it there for right now. Catch guy coming up with much more on fast money at 5 00 p. M. , he and kevin oleary are going head to head once again in a rematch over dividend stocks. Whos going to win this time . Youll want to stay tuned for all of that. Well dive deeper into nordstrom rules after the break. And in light of macys big miss. Also markets making a move higher after Vladimir Putin claiming russia would do its best to stopped bloodshed in ukraine. Should markets be trusting him now to keep his word . These names about ring a bell madoff, skilling, evers, currently serving long jail sentences. Were judges too tough on them . Defense lawyers and prisoner advocating are arguing for shorter sentences for business claims. Well debate it. Youre watching cnbc, first in business worldwide. During the cadillac summers best event, lease this 2014 ats for around 299 a month and make this the summer of style. People find out state farm does car loans as well as they do insurance, our bank is through. Good point. Grab an edge. Look theres two guys on the state farm borrow Better Banking sign. Nope for real theres two dudes on the state farm borrow Better Banking sign. [ reporter ] breaking news from the state farm borrow Better Banking sign. Were seeing two men that have climbed the borrow Better Banking sign gentlemen please get down from the state farm borrow Better Banking sign. Phil get the hose. Okay hes getting the hose. Alright, lets go. [ male announcer ] talk to a state farm agent about car loans that can save you hundreds. Thats borrowing better. We begin with an earnings alert. How about something besides retail . Were checking out auto desk as the company beat on both the top and bottom lines. It also reported record revenues are 637 million. You can see their shares are trading at least, sharply to the up side, up by about 4 . Then theres applied materials, also out with the Third Quarter results. The Company Earned 28 cents a share, a penny better than estimates. Those sharing, and with applied materials, kelly, its one of the stocks investors look for, because its a leading indicator for the sector since they make the stuff that makes computer chips. Thank you, dom. Rough numbers from walmart and macys this week, representing the low and middle end, now the emer end with nordstrom out with better earnings. What does this suggest about the state of retail and the economy broadly . Lets welcome or panel back. Weve just had a spicy debate about j. C. Penney, which performed quite wet after hours, but is this a name you like . Yeah, im totally board to tears with that stock. But, you know, its a great company. They make theyre not going to make any money. Whats your position on nordstrom . I think i have to agree, theres not a lot going on. I have a hold rating. I will point out one thing. Everyone will say this is a testament to the high end. Fullline extort declined 1. 2, the rack, the off price division of nordstroms was the one that had the 4 gain that got them to the consolidated 2. 7 . Thats a great point. So is this because Nordstrom Rack is more fast fashion, if you will, or do you think this is purely an income story . I think it might be an income story, but i think it has more to do with opening rack stores, so they should comp better. Rick, its interesting to compare what we saw with walmart this morning, too, what we saw with nordstrom after hours. On the one hand we have walmart saying are they going to be hit, because were building so many neighborhood stores. Nod strom seems to be taking this expanding in stride, managing to not only digest some of these comp increases, but also manage the costs better. How do you think theyre doing this so well . Thats a great point. The rack actually has a lower gross margin, so the gross margin at the pole line stores must be holding up. These days i tell people its all about merchandise. The retailer have to have items, they have to have merchandise that can hold price. If you go into a nordstrom or macys, theres a lot of items on which they can hold price, a lot of brands that people want. I think thats where they are differentiating themselves. Aaron, how do you lump all of this together, from where you is it, is it about retail . About Consumer Discretionary . Just walk us through where this leaves markets. This is really about the Department Stores going into the big stores, which is a smaller leases. For nordstrom, for us its still not something we find attract e attractive. Thats high for a Department Stores, so even though theyre doing better, i dont find it attractive at this point. Board in a good way, mark . Is that sort of the take . Theyre operating at a high price, hard to see them accelerating significantly from here . Yeah, you know, its like 12 or 13 times Free Cash Flow. They are buying back stock. So thats cool. You know, that means i dont know who else in the Retail Sector is buying back stock, and their debt is really nice. But, you know, fine, youre not going to get a quantum increase in the stock price like you are with j. C. Penneys thats basically what i see happening here. Also i think they might be stealing a bit of market share from the macys guys and all that stuff, but certainly j. C. Penney is, all right . I think so. I went and bought two shirts there and a pair of pants for 47 at j. C. Penney the other day. Just couldnt believe it. They had all my sizes, the ladies, i couldnt did it chart with a chap check and turn you into a customer, or did you go in intending to buy something . No, i already bought the stock. Ive got a huge position in it, but the point is i wanted to actually go see the ground floor, and i loved it, man. I couldnt find my sizes, couldnt find of kind of stuff i wanted other than at j. C. Penney. Im a regular guy. I hate shopping. Rick, last word to you. Its going to be interesting. I think j. C. Penney is up against tougher comps. Well see how they do next quarter. Dr. Jay, last time you were in a j. C. Penney . Probably ten years or more. Im not been part of the ron johnson thing, not been part of any of the turnaround, farce being in the store. I traded based on flow of cash. No, im just curious about the fashion. Yeah, i dont shop there. Well see maybe if this gets people more interested. Mark not enough skull stuff. A lot of retail earnings. Market here, made positive news today, on if the heels of russian president putins comments. He said russia will do the utmost to stop the bloodheld, but at the same time said he would set up a military task force in crimea. Well discuss that, next. How do you know which ones to follow . The equity summary score consolidates the ratings of up to 10 independent Research Providers into a single score thats weighted based on how accurate theyve been in the past. Im Howard Spielberg of fidelity investments. The equity summary score is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. And this one is a big one. Warren buffetts shop. Buffett has taken a new stake in charter communications, the cable tv operator. Also, in terms of increased stakes, he boothed the shares of verizon by about 4 million shares. Also a huge reduction in shares of Oil Exploration conoco phillips, down about well call it. It yookd to be now about 1. 3 million shares. So again very notable moves coming out of Warren Buffetts berkshire hathaway. Complete elimination of the stars and booth in holdings for verizon as well as general motors, it looks like, and International Business machines as well. Were going through the rest of the lith for right now. Now, russian president Vladimir Putin, and market reacting positively. Bob pisani, and wile investors started buying when he said it. You can be as skeptical as, but he did move the market. He spoke in yalta. The important thing, 6 00, putin will do his utmost to stop the bloodshift. Look at that spike up ought 6 00 a. M. Thats where the markets moved. That is the little move down just before 9 00 eastern time. The third important headline, just really crumby numbers in terms of gdp numbers. Were supposed to be expanding in europe. This is why, kellie, germany has been stalling out. Ukraine is obviously not helping, but this is why our tenyear yields are at record lows, another low, they, and finally the biggest question of the week, why are we up . No other place to put money. There is germany the last three months. The green line, your white line, investors have known about this underperformance long before the ukraine thing. Im not saying eye crane isnt an issue, but germany has underperforming for about three months. Those months. 6 03 arm eastern time. So trader obviously believed what he had to say this morning. Although it hiked the price of analysis gab, so why do markets believe that putin when he speaks, lets ask jeffrey makoff. Jeff, welcome. Thank you. You heard what this report just now, markets rallying behalf think deescalate in rhetoric. Is it the wrong move to take him at face value here. . Its worth what he says. Where the rhetoric and the reality just havent meshed up. Until proven otherwise, we have to assume that theres not going to be a major change right now, either. Well, know, but its still early. Theres a convoys under the auspices of the red cross, which the red cross has disclaimed, and the ukrainance said they would not admit without inspecting the trucks and oversight. The fighting in ukraine is still very much going on, so until proven otherwise, i think its probably safe to assume that the crisis is not over yet. Just warrant to bring in the panel. To what extent is it a factor . Bigger factor that is gaza. That is because, of course, jeffrey, as you know far better than i, whats going to be happening in the fall and winter is going to be the focus of energy traders, and ag, all will be impacted so, yes, i watched that and listened to what happens, whether or not those are really aid trucks or not. Jeff, im wondering, we did see the German Economy contract this morning, that wasnt even include the most recent wave the sanctions, so how short term do you see thinks is being honest in this situation, on you do you expect the fundamentals of the economy will feel the reverbs for several quarters to come, if not years . Well, you know, i think in some way the u. S. And the europeans are in a different position here, because the europeans, especially the germans, are much more exposed to what happens in russia. The german business lobby is very concerned about the potential to negatively impact the economy there. In terms of wanting to ing there, you know about some of her partners in elsewhere in europe. Just finally, jeff, well, what would you say to the investing public for the next couple days, week even, as we continue to watch this back and forth between russia and the ukraine . I would just say be cautious and dont do anything abrupt before we know if this is a turning point or not. Jeff, thank you so much this afternoon. Thank you. Dominic chu rejoins us. Whats going on . A stock is not moving, but its of were watching chiquita brands, the companys board of directors had said that the unsolicited offer from both the katroli group and from safra announced a few is knead st. Inadequate. The board says it unanimously reaffirmed its recommendation to approve the previous merger with fyffes. Chiquita is trying to buy fyffes perhaps to perform a tax inversion. So again, an unsolicited bid from cutrale, and safra has formally rejected by the board. They want they want to go through with the previous deal to buy fyffes. Thats why we are following this one with such interest. Dom, thank you. Thar they blow. The biggest investors, the wall street whales submit their 13f filings and we find out how bigmoney investors have traded. Dom will be back with the latest sightings. But first advocates are pushing to lighten sentencing for swindlers and other whitecollar criminals. Thats next. Developers are all 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. The ibm cloud is the cloud for business. Tdd 18003452550 can take you in many directions. Spark your curiosity tdd 18003452550 you read this. Watch that. Tdd 18003452550 you look for whats next. Tdd 18003452550 at schwab, we can help turn inspiration into action tdd 18003452550 boost your trading iq with the help of tdd 18003452550 our live online workshops tdd 18003452550 like identifying market trends. Tdd 18003452550 now, earn 300 commissionfree online trades. Call 18886282419 or go to schwab. 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The issue here is the ability of the courts to consider the factors that we believed to be most relevant. And that has been set so high so that virtually any companys ceo convicted of almost any securities offense faces a guideline sentence of life without possibility of parole. So were talking about taking nonviolent, firsttime offenders, and treating them as if they had killed someone. There may be some circumstances in which sentencing like there are appropriate. What youre group is advocating, and im working now on behalf of the american bar association, is for judges to consider more than just loss. They think its a how long did it go on . How sophisticated was it . Dont they they must take all those factors into account . They do not and cannot under the guidelines. The guidelines consider only the amount of loss. Got it. You. Before we bring in the panel, i understand you think theres no way these sentencing should be lightened . Thats one of the dumbest things these guys are rational, and they dont want to spend the next 20 years in a prison cell. If you look at, bernie ebbers, jeff skilling, the guys who spend decades in prisons, and weve had zero major accounting scandals since then. Now, wait a minute. To say that we should take it into consideration is a joke. Zero major accounting scandals . I feel like is that enough of a deterrent to see a couple guys sitting in prison for a few decad decades, so that everybody else, up and down the business industry, feels like they better not . I think a lot of people are frustrated when bank of america keeps paying bills onand bills onin fines that seem to never end when none of those executives went to jail. In fact, it may have been some of the companies that they acquired, of course, kelly, that with responsible, but nonetheless some of those folks needed those kind of folks away. Rather than just focusing on a few of the people, the Jeff Skillings and so forth of the world. Kelly, remember the timing is absolutely crucial. Investor confidence is at an alltime low. We no that no Senior Executives have been indicted. So if you take the people who got caught with their hand in the cookie jar and say, gee, were going to slap them on the wrist, that eadvice rates any investor confidence. I dont think they see are the type of crimes that jail time solves. If someone has a propensity to mismanagement money or inside trade, the doj and s. E. C. Have the power to strip those people of any rights to manage money. Im sorry. Hold that thought. Breaking news on cocacola. Whats going on . Cocacola is taking another step to try to rule the beverage rule on the heels of the keurig investment here, they have now maid a 2. 15 billion investment in Energy Drink Maker monster beverage. In return monster will give cocacola a 16. 7 stake in the company. So the details of the transaction are as follows. Cocacola takes a 16. 7 ownership stake in monster beverage. In return, cocacola will transfer ownership of the Worldwide Energy business, including brands like f. Several names, to monster beverage. In returns monster beverage will transfer the nonenergy drink business includes hansens, peace tea. Theyre in essence swapping brands in return. Cocacola gives them 2. Some billion, and they get in return a 16. 7 stake. So a very large deal on the Consumer Staples side of things. Cocacola making a large 2 billionplus. Dom, thank you. A couple things, first, thanks to andrew and jim. Theres more on cnbc. Com vote. Lets put monster back up. On the news of this deal, it looks like those shares are popping. Now lets get to our panel with some thoughts on this. Kayla, you first. It was probably just a year ago that they were going to buy monster that monster and coke ill never forgot watches the weekend update saying but actually cocacola in reality, this is a much different deal, trying to get into the health space. As the market for cashinated beverages is detirating. This is great news for us. Weve liked monster for a long time. Actually its a story its very challenging. This is exactly what coke should be doing. What about pursue the. Most people do identify with the energy side of it, but then the hansen side is pretty exciting for a lot of folks as well. Quite frankly im sure some of the folks at pepsi are not too happy, because this is a deal they probably could have and perhaps should have done. Why do you think they should have . Certainly pepsi would be looking at possible acquisition, why do you think they would look at cokes acquisition and feel as though they missed a beat . I think the sugar side of the business, more and more of the soft drink drinkers are looking for, rather than corn syrup, looking for real cane sugar, so forth, in the drinks. Thats one of the things i think could be attractive to people who want an alternative. So cocacola taking a big stake, amounting to an asset swap, as mentioned. Monster shares are up to the tune of 24 after hours. Well have much more when we come back. State farm does car loans as well as they do insurance, our bank is through. Good point. Grab an edge. Look theres two guys on the state farm borrow Better Banking sign. Nope for real theres two dudes on the state farm borrow Better Banking sign. [ reporter ] breaking news from the state farm borrow Better Banking sign. Were seeing two men that have climbed the borrow Better Banking sign gentlemen please get down from the state farm borrow Better Banking sign. Phil get the hose. Okay hes getting the hose. Alright, lets go. [ male announcer ] talk to a state farm agent about car loans that can save you hundreds. Thats borrowing better. Welcome back. Youre looking at shares of monster beverage, surging after cocacola is taking nearly a 17 stake in the company. Our dominic chu has more details for us, as we follow this big one, dom. Thats right. Only interesting because of the cocacolas high profile investment in keurig green mountain, that theyre investing in for singleserve athome brewing systems. I want to add comments made by the executives of cocacola. Muchar kent said the Equity Investment in monster is a capital official way to, and category, we believe this partnership will create compelling and sustainable value for our system and shareholders. Meanwhile, rodney sax, the chairman and ceo of monster beverage says the transaction announced today represents a unique opportunity. We game access total distribution system, the most powerful and extensive system in the world. So again both executives, both teams coming out and talking about the virtues of this deal, one of the reasons why you can see both cocacola shares and monster beverage shares are up on this, perhaps signaling that both sides like the potential of this deal. Lets talk to one of the analysts in the space. Bill schapelle, bill, thanks very much, your first thoughts here . Wow is probably the first thought. Its something we had thought might happen in terms of coke about two years ago, but anyone the negative headlines and stock price surge kind of quashed that, so we hadnt heard much on potential partnerships for a couple years, but we also cover green mountain, so this is similar to the set upof taking a minority interest in a Company Company to kind of fail down the partnership, but this goes even a couple steps further in terms of changing the disagreements world wide and transferring licenses and businesses. So do you think this is a better deal, bill, for coke or monster . I think its really better. I think theyre both winners in this one. Coke certainly needs growth and its own energy brand, which are burn and knauf has been nonstarters. Monster, not only in the u. S. Where it has a leading share, elsewhere has been gaining share and hitting the ground running. So its a nice shot in the arm to coke and their distributors to have the monster kind of partnership going forward. For coke, understand, monster right now in the u. S. , half of the distribution is through cokele half is actually through ebi, anheuserbusch inbev. They have enbev in brazil and elsewhere around the world. This gives coke control as they go around the world. So i think its a winner for coke as well. S thats reflected in the shares at this hour. As we watch shares of monster and coke moving to the upside this hour. Well have a complete roundup of the major names in after hours along with these two when we come right back. You do a lot of things great. But parallel parking isnt one of them. Youre either too far from the curb. Or too close to other cars. Its just a matter of time until you rip some guys bumper off. So, here are your choices take the bus. Or get Liberty Mutual insurance. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. See Car Insurance in a whole new light. Call Liberty Mutual insurance. Thats why i always choose the fastest intern. R slow. The fastest printer. The fastest lunch. Turkey club. The fastest pencil sharpener. The fastest elevator. The fastest speed dial. The Fastest Office plant. So why wouldnt i choose the fastest wifi . I would. Switch to comcast Business Internet and get the fastest wifi included. Comcast business. Built for business. Welcome back. What an hour, dom chu has certainly is been busy. Along with disclose years, we got the coke news. I mean, so much breaking news, right, kelly . We want to get you up to speed on the money manager holdings. Pershing Square Capital getting rid of beam and apartment inventory and management company. There some good stakes getting rid of there. Then there is david temper at appetizing appaloose sa, eliminates his position in hess. Paulsen added new staits stakes in allergan and direct tv and got rid of stakes in American Airlines and general motors. We have warren buffet. Lets reiterate a new stake in charter communications. Remember, this is Holdings Data from the june 30th snapshot. Again, there this is 45 days old. It gives you some indication, perhaps, of what these Money Managers have doing. Over to you. We will get final thoughts along with a roundup of whats happened this hour when we come right back. Also our collectible cars, our own robert frank is at the pebble beach car auction where people are fliping cars for huge profits. You can catch that story tomorrow on the closing bell. Well be right back and the free of the open road . Welcome back. Lets get to a final thought here with our panel. Erin, you first. Id say even though the apps are 40 days late, there is still persistence in which stocks will outperform when you look at different types of investors. When you look at stocks owned by hedge funds, versus endowments or hedge funds. Its better to look at overall who the big shareholders are, the better for performance . So a stock lets say is owned heavily by a hedge fund would outperform versus something heavily owned by a pension. Do your homework tonight, dr. J. I think coke threw down the gauntlet. They have done it with monster. So watch this space. Watch it to see if this is instead of an outright deal. Because that deal may be off the table if they got everything they wanted that they could have otherwise bought. People speculating this could be a takeover target. Well see. The markets are sleep walking. Well see season volatility. My thanks to everybody. Now its time for fast money coming up with Michelle Cabrera caruso in for melissa lee. So much news after the bell. Such a busy session. There is a lot to get to. We will hand it right over to you guys. Thanks, so much. Fast money starts right now. We are live in new yorks times square. Our traders tonight are tim seymour, brian kelly, karen feinerman and guy adami. Cocacola is moving higher on the news along with monster beverage which is soaring after hours. If coke is moving higher, clearly, those shareholders leak this idea. This is the story of the market. We talked about why the market keeps going up. You might have mediocre news, these Large Companies have to go out and buy that