Transcripts For CNBC Closing Bell 20150501

It was streamed online. After all that i wasnt up at 11 00 p. M. I tried. I didnt think you would be. At 3,000 for the battery. Really, how much would the whole thing really cost you to buy and install . Well separate the fact from the fiction, coming up. This is the critical point. Social problems meantime linkedin, twitter, yelp all taking it on the chin after earnings reports. What tech stocks will take center stage with perhaps big moves next week. Plus a look at the pawn shop economy. The man who has his finger on the pulse of the consumer Rick Harrison will join us on the floor of the New York Stock Exchange. He has a unique perspective on the shape and strength of the economy right now, especially from the consumers perspective. Hes also brilliant. Hes a smart guy. The Great College professor you had who knew everything and had these great stories. Really looking forward to having him back on set. About an hour to go to the close. Yesterday, to close out the month of april, declines across the board. A lot of trades that had been working up to that point really werent working yesterday. Which is the trend and which is the counter . Today were starting the month of may off, typically a tougher one but with green arrows. The dow is up 169 points almost 1 . Same goes for the s p, up about 20 at the moment. The nasdaq the outperformer of 55. Other indices are also very strong which we will talk about in our Closing Bell Exchange right now. We have joe duran from united capital, beth ann bobino from s p. Shes with us at the New York Stock Exchange and so is kenny polcari. Whats this rally about today . Its much more a dead cat bounce after what happened yesterday, right . You saw the market sell off violently as we ended the month of april. As Arthur Cashin said yesterday, it was like window smashing instead of window dressing. Today is a low volume day. Rally back is not really on a lot of commitments. I think you really have to be careful when you think, listen its all over. Its said and done. I think well run into more of an issue as we move into the next week of may and we have more earnings reports. Speaking of the fundamentals weve had earnings and news on the economy that hasnt been all that great. The Consumer Spending data, okay, i guess. This mornings ism number not that great. How is the atlanta fed consistently nailing the gdp print . It is may day. The good news is it doesnt look like were going into may in a deep freeze. We are expecting weakness. It will be softer than what were usually for. Its slow and steady all along. Keep in mind while that manufacturing number you brought up that sentiment reading, its showing the expansion in the Manufacturing Sector suggesting theyre able to basically take up absorb that dollar strength. Consumer sentiment is very strong. Its at a 2,000 a very strong number. Also, the employment cost index indicates that wages are now at the highest rate since 2008 suggesting people are getting more money in their paychecks. That number we were convinced yesterday was what was causing the selloff as people were expecting maybe the fed will start raising rates in june but now we have todays rally. Never mind. What do you think, beth ann . I think probably everybody just changed their mind today. I do that all the time. In terms of i suppose that strong wage numbers put the fed back on the radar. We are expecting the fed to move in september. We think the numbers are showing march is a one off. The fed will be waiting to see strong readings for the april jobs report. Were thinking something over 200,000 will be which we expect will be something that will give them reason to move. Were also looking for the wage numbers to really pick up. Remember, we have a lot of people that came into the market. Look at the millennials. They basically came in in 2007. They were hit by the weak job market. Right. Lets see if 2015 gets a better shop. Joe duran, are you making any changes as we get into the month of may now . Yes, i think youve got to start looking at where do you invest in a potentially rising rate environment . Even if it only starts in september. Weve also seen longterm rates going up. You want to be larger cap in a rising rate environment. And the second thing that were looking at is going and investing where the markets havent participated as much europe emerging markets. Those valuations are quite attractive relative to the u. S. And i think the u. S. Is in better economic shape but interestingly, germanys gdp was better than the u. S. s in the First Quarter. So which isnt saying much by the way. No, not much. But were in the early stages of money supply increase in europe. Youre going to see, i think, rising asset prices. Youll also see less volatility. I think interesting to go large cap, europe and emerging markets and of course you still have to invest in the u. S. All right. Let me and bonds, bonds are very high risk. Let me get another angle in here today. Transportation stocks have really shown today, gaining altitude, bob pisani is at the post where most the Airline Stocks trade right now. Bob . Big rally today. Yes. Its interesting. Transports had a tough time in april, particularly the Airline Stocks. Im here at the post. John mkcthatnamerney. Let me show you the chart here. This was southwest, at 43. Went all the way down to 40 as oil spiked up to the highs for the year. These are what i call japanese candlesticks, which a lot of guys watch when theyre down here. Generally the news trend is very good. Fares are higher and the airlines are more profitable. Southwest may double their earnings this year. Summer travel demand has been strong. The important thing, most of the airlines are still trying to find ways to reduce capacity even though business is great they want capacity down because theyre managing for profits, bill and kelly. Theyre not managing just for revenues anymore. They used to try to maximize revenues. Now they just want to make profits. Thats starting to shine through. The higher oil is a little bit of a problem for them. All right. I think theyll work through that with higher prices. Great stuff, bob. Thank you. We want to get comments from our panel in just a second. We have breaking news on auto sales in the meantime. It is that time of the month. Phil lebeau has details. How do they look. 16. 45 million. That is the Monthly Sales rate according to the folks at auto data. They crunch all the numbers together for some comparison, most on wall street were expecting a sales piece of 16. 7 million. This is a little shy of that but compared to april of last year its a 4 gain. Again, the rate 16. 45 million. Guys, back to you. Phil if i may, im surprised by that. I mean to come in that shy of forecasts, what do you think is going on here . Im not surprised, kelly. Doing this long enough i usually see it swing up or down 3 or 4 . Thats not a huge dropoff compared to what wall street was expecting. You remember at the end of march, you do have a fair amount of the automakers and dealers really pushing sales for the end of the quarter. Thats a big push there. You add a strong number at 17 million last month, there might have been pay back here. That 16. 5 i dont think it will make anybody sit there and say weve seen a dramatic slowdown. May is expected to be relatively strong. Joe duran, let me go to you real quick. Given the choice between the auto sector and the airlines here which would you pick . I think you take the autos. What youre seeing is higher incomes and oil is very unpredictable and my sense is that youd rather be in the auto sector simply because we are seeing an increase in incomes, the economy is stronger and everyone loves a new car. But i think thats where youre going to be more interesting in the growth going forward. We welcome winnies son from the son group well partners in l. A. We worked out audio difficulties. Glad you could be with us winnie. So glad to be here. Bringing you up to speed, which market are you more likely to believe, yesterdays selloff or todays rally. Probably neither. I believe right now we have challenging times and the u. S. Is sluggish. Going forward, were optimistic but were cautious. Winnie is that im curious about some of the high valuations were seeing in the private markets. Some of the exciting names that are over there versus the opportunities here in the publicly traded space. Do you think at all theres a lack of good opportunities . Well kelly, theres never a lack of opportunity if you have money. Theres money to buy. Theres opportunity. Right now, for us here in california we feel very comfortable with the story of technology. We saw weakness yesterday. Long term thats a space that were bullish on. Even the social media names, winnie, some of the ones that got hit, you dont think thats the end of some kind of trend . Linkedin got hurt a little bit this beak but long term you know, at the end of the day, social capital is extremely valuable as you and i know. People are communicating and watching news differently. We saw that with telecom, with verizons news recently and fios. In this day and age, social media, theyll figure out a way to capitalize. Kenny polcari, do you want to see more strength . What do you do with the market . Ill ask you basically the same question i asked winnie. Do you believe yesterdays selloff or todays rally. I believe yesterdays selloff is where were really going to go. I think were challenged, well hit resistance as we challenge the highs. I dont think the market is ready yet. I dont think the economys ready yet. All the data were seeing continues to be weak. Even though i agree well make a slow recovery i think the market is still challenging. It needs to let the economy catch up. I want to say one other thing when you talk about stocks like linkedin theres not a lot of capitalization in terms of shares outstanding. Its a 200 name. The moves that you see in a stock like linked in are exaggerated because of stock outstanding. Theres not a lot of float. Therefore, it creates even more volatile moves. Thats a great point. Well give you the final word. What were you saying about payrolls, whats your estimate. Looking something over 200,000, probably 225,000. That would be a nice reprieve from what we saw in march. It would. Maybe theyll revise march up a little bit. That would help as well. Thanks folks. Good to see you. Have a good weekend. With a little over 50 minutes to go we are seeing gains across the board and key levels to watch. The dow back above 18,000 at the moment. The nasdaq just about 2. 5 points away from being back above 5,000 and up next is elon musks tesla turning into more of a Battery Company . Plus reaction from that from generacs ceo. Theyve had a tough week too. Earnings disappointed, stock down hard. Well talk Aaron Jagdfeld coming up. Recentick harrison on the economy. If youre running a business legalzoom has your back. Over the last 10 years weve helped one million Business Owners get started. Visit legalzoom today for the legal help you need to start and run your business. Legalzoom. Legal help is here. Rally down wall street especially technology the nasdaq up more than 1 . We were talking earlier about which market do you believe, yesterdays big selloff todays big rally . Art cashin, our great mentor came by during the commercial break to point out yesterdays selloff had much heavier volume, over a billion shares traded where as todays rally will maybe do 800 million. Volume equals validity were his words of wisdom. Tesla locking into lold gains, up about 20 . Elon musk unveiling his latest innovation. New batteries for homes and businesses is what its all about, phil lebeau. Take a closer look for us. Reporter what were look at are the numbers behind the new battery units, specifically on the consumer side. 3,500 and i can have a backup power supply in my house . Thats all it costs . Not necessarily. We reached out to the folks at voler city an they indicated its not own hadly 3,550 you also have to either sign a nineyear Service Agreement for 5,000 or buy the inverter and handle the installiation. Then theres the question about how much these batteries will cost, these units will cost when operating them. Theres an interesting study, if you will back of the envelope math being done by a professor out of princeton. He basically says from his calculations it comes out at ten times the cost of a generator. Could be as low as four times the cost. Its more expensive than running a generator. He says it could work out to 70 cents per kilowatt hour cycle. Keep in mine well see more studies over the next couple of months where people will say what are the real costs involved here . And how much are you actually saving . And does it make sure for people who have solar panels to also have one of these systems . So if they do run into a problem with the grid they can have backup power. Phil thank you. Thats what its all going to come down to. Teslas new battery product could create competition for generator makers like generay. Aaron jagdfeld president and ceo of generac holdings. Its an interesting product. Obviously its not a new product, the technology and concept have been around for quite some time. From a purely economic standpoint, we would agree with all the information thats being gathered on this in terms of it being really not an economical solution for a backup power, a pure backup power source. What our products are for are for those people who could experience extend outages. So, you know if you have a large storm or hurricane, ice storm, whatever the case may be and your power is out for a day, two days or a week, a battery pack will last you 48 hours. The challenge would be to spend 10,000 on a solution that only lasts 48 hours. You dont know how long a power outage is going to last. Thats really where our product comes in. Your product offers what by comparison . You just said tesla, the user at this point would be spending 10,000 for 48 hours of power backup. That compares to what youre offering. Their product would last between four to eight hours. Our product can go weeks on end as long as you have a natural gas fuel supply. You add another 3,000 2,000 to 3,000 depending on the cost of the installation to have it put in your home. What about the environmental issue, i mean one thing weve not addressed here is that this would be can be attached the elon musk version, to a solar panel. Theres no gasoline involved no natural gas involved. Can you go that direction as well eventually at generac . Over time if the Technology Becomes more economically certainly a battery could be envisioned as part of a broader backup strategy for the company. Its something we continue to watch, fuel cells, microturbins and other things that have been out there for years. Battery technology is flat out economically solely as a backup source. As a storage device used in concert with solar array or wind power, it could provide a homeowner a brief respite from the grid should the grid fail. Its not going to give you a day, two days or a weeks worth of power. Phil. As you heard the anournsnounce mat last night, then the reaction today, we saw the hit your stock took and the knee jerk response from investors out there, what was your reaction as you saw how the mcwas digesting this information . I think theres a lot of information to be learned about what the solution is right . The announcement itself was a little bit thin on details. Weve had to do digging as have you, phil, in terms of trying to figure out the true cost of the system. I think as people figure this out over the coming weeks and months ahead, the math again, for our product in the space that we provide a solution for, its for people who want to have coverage in an extend outage. This reallien is for our market. Its not really were kind of serving different markets with the different solutions. I think the hit on our stock, frankly, is more related to the First Quarter earnings miss than it was at announcement by tesla. Right. Nonetheless, its the timing is what the timing is. Aaron, to that point, your miss was partly because of the drop from the oil and Gas Companies who use your systems. Obviously they were in a tough environment. Do you think this announcement by tesla could help capture the consumers imagination when it comes to what your system or others can do in the home expand the pie, if you will and give everybody a piece of it. We love to have the discussion about backup power. If this is helping consumers understand the options and the space and probably more importantly, kelly the need for backup power. The grid continues to age. These are things that while maybe they didnt happen to us these may not be particularly happening on a much greater frequency. The duration of outages is longer than it was ten days ago. This is where our product serves a wonderful purpose for people who have concern about that. And the tesla product i think is serving a different part of the market. All right. Aaron of generac, thank you. Can you believe that about the power grid . Thats where the need for infrastructure, investment, thats what were talking about, longer power outages, more frequent failures. Taking that huge demand off the power grid periodically will be a big move down the road. Thats for sure. Transformative. Heading to the close, we have about 35 minutes left in the trading session. Holding near the highs for the major averages, the dow is up 165 points nasdaq up the s p up roughly 20 points almost 1 gain there and the nasdaq up 1. 1 . Almost back to 5,000. Coming up wall street feeling a bit antisocial this week. Two top social media stock watchers will weigh in on what other social names might get hit next. After the break, Rick Harrison of pawn stars will be here. Hes wandering the floor. Everybody is recognizing him. I dont know if theyre trying to pawn something or whats going on. Hell tell us if he thinks u. S. Consumers are back to their spendhappy ways. There he is. Rick harrison in the house. Heading toward post nine. Back in just a moment. Ive never been to las vegas and ive never pawned something in my life. I have to know how much the gold in this college ring is worth. The college rings, its a novelty item. You have scrap value. This one is 2007. 2007. You have around 14 grams. You have 200 worth of scrap here. He tried to let you down gently. People cant see is that hes shaking it in his hand right there. Almost like somebody smelling dollar bills. 200 for the college ring. I gave it my best shot. Hes one tough cookie at the pawn shop. Rick harrison knows a good thing when he sees it. With thousands of people going in and out of his gold and silver pawn shop there in las vegas on a daily basis, rick is a gauge on how consumers are doing. Well bring him back pleased to welcome you to the have you ever been here . Yes, a few times. Nobody was trying to pawn anything off as youre walking the halls here . This is a recognizable not pretty face but recognizable. I always hear how much for the watch . How is the consumer doing right now . My sales are steady with last year. Its not up its not down. Are you counter to the economy . Things are good everyone thinks that with pawn shops. Really . When the economy was dying in 08, especially in vegas, 08 and 09. When people are wanting to sell me power tools, im like no i cant take them. People are not buying them. You do exactly what these specialists do by the way. Yes. You buy when everybody else is selling and vice versa. The whole theory is to make money. Well speaking of which, how is vegas doing . Wynn resorts reported earnings that showed a little bit it looks better. Theres a big fight coming to town this weekend. Its absolute insanity. Im bulling a shopping center. Pawn plaza. Its bizarre. But everything has worked out. Rick harrisons pawn shop is off the strip but a lot of people come, line up and a lot of people want more of the Rick Harrison experience across the street. Youre putting up basically a strip mall but a new century strip mall. Its made out of containers, is that right . Theyre manufactured to sort of look like containers. Its modular. Theres a million tax advantages. Its considered a mobile home. Its equipment. Its considered a mobile home. You can move it. Technically its movable, then again its not real property. Its equipment. You can depreciate it over five years. You have all the angles figured out on that one. You dodged the fight question. What is that going to do for the vegas economy. Hundreds of millions of dollars will be pent there this weekend. I hope youre open on sundays. Those who lose the fight will want to pawn something. Theyll be there saturday night. Lining up for it. Real quick, tell us what we can expect out of pawn plaza, when it opens. You have interesting restaurants and what kind of shops as well. Its going to open on july 4th weekend, hopefully. You know how construction is. We have smokes canteen, theyre huge in canada. They are doing lines until 1 00 in the morning. I have old man interactive going on with trivia games, ricks trivia challenge. Im working for marco rubio now a little bit. Wow. Im like the bobby prize. Are you still shorting tesla . No. I think the product they came out with today is absolutely amazing. I have my ranch up in oregon. Its completely off the grid. And the battery thing is what i for what hes doing right now, which i have i have 2,000 pounds of batteries that i have to use on my solar and hydro. This would make it more efficient. It would make it so much less of a nightmare. When you have racks and racks of battery that you have to unscrew and check acid levels and gravity all the time. Its turned you around on the tesla most people dont get how important the battery is. I have a power plan that the makes around 4,000 watts of power but i can use 20,000 watts of power anytime i need it with all the batteries. The batteries will be a game changer eventually. Always good to see you, rick. Thanks. Love it. Rick harrison. Time for a cnbc news update this hour. Heres sue herera with that. Heres whats happening this hour. The u. S. Attorney says he is not planning on charging anyone else in the George Washington bridge lane closure case. A former ally of new Jersey Governor Chris Christie pleaded guilty today and two others were charged in the scheme to punish the ft. Lee, new jersey mayor for not endorsing christie in his reelection bid. A baby girl was born to a young people in nepal in one of the field hospitals set up by foreign relief workers. Both mom and baby are doing well. The midwife said she hopes that this news will show all that there is some hope for the future. A private Research Firm says the apple watch costs less than 84 bucks to make. The company says the watch has the lowest ratio of hardware cost to retail price across any apple product. The watch prices start at 350 bucks but can go upwards of 10,000. Weve been talking about the gw bridge scandal a lot today. You saw it on twitter, no doubt. Well, no actress Kirstie Alley is not involved. The actress started trending on twitter after jokes and confusion from people who were reading christy ally in the headlines. The actress responded on her twitter feed, help. ItsKirstie Alley. Its christy ally. The poor woman. 25 minutes to go until the close. Were grilling Rick Harrison about his Battery Technology. Look at markets, a strong day across the session. The dow is up almost 1 so is the s p 500. Nasdaq a couple points away from reclaiming 5,000. When we come back, talk about the social media stocks got clobbered this week. The pros will tell us how concerned you should be about valuations and profit potential down the road. Later, bestselling author walter isaackson. And drones being used for everything from saving lives to graffiti. Theres some facts about seaworld wed like you to know. We dont collect killer whales from the wild. And havent for 35 years. With the hightest standard of animal care in the world, our whales are healthy. Theyre thriving. I wouldnt work here if they werent. And Government Research shows they live just as long as whales in the wild. Caring for these whales, we have a great responsibility to get that right. And we take it very seriously. Because we love them. And we know you love them too. 22 minutes left. The dow is up 161 points at this hour sitting at 18,000 up 20 on the s p. The nasdaq up 55 points. Just shy of 5,000. Of the dow 30 components, four are negative right now. The big winner today is apple. Chevron is at the other end the biggest loser among the dow 30 today. Another barrage of earnings hitting wall street today. Well kick off with rubbermaid. The household products maker beating estimated by 2 cents. Revenue was in line with expectations. Newell confirmed its forecast as well. Its stock up over 4 . Linkedin plunging 20 after slashing its fullyear forecast. The social Networking Company revealing its revenue growth. That wasnt the only social stock hit by earnings. Facebook yelp and twitter also disappointing the street. Their stocks are mixed as we head into the weekend. Bill, back to you. All right mary thank you very much. Other social and Tech Companies are set to report next week. On thursday we get alibaba and zinga. Will investors be antisocial with those stocks . Ross gerber from gerber kawasaki and jeff reeves from place. Com. Welcome to you both. Hi guys. Ross is this a get rid of all the social media names in your portfolio moment or not. Not at all. This is a buy the social media stocks in your portfolio moment. Twitter is not going away. Its a beautiful search tool. Periscope is a game changer. Somebody has to come in here like google and buy twitter now. If you look at the stockbased issue, twitter has good growth in front of it. Jeff reeves youre not quite as impressed, are you . Im not. Weve been looking at twitter for a long time. If you actually look at the gap numbers, general lyly accepted accounting practices, its even worse. I think its important to separate user growth and potential for consumers. Everybody likes twitter but that doesnt necessarily mean its a good investment for investors. It also doesnt mean its fairly valued. A lot of the companies have been sole off because it is the bottom line. As an investor im in it for the profits. There just are none. Alibaba and zinga next week would you steer clear of those . I would. The only social media stock im okay with is facebook. It has the scale and marges sinmargins. I think its very important for people to watch the bottom line. You can grow ad sales by growing your ad spend four your team but that doesnt necessarily end in profits. The stock will go nowhere. Not all social media stocks are created equal. You dont like linkedin. You called that a onetrick pony. Linkedin doesnt have anything but ads for jobs. We dont use linkedin for anything else. Im an advertiser on all these particularity form platforms. I know the other guest is not. This is what people were saying about google ten years ago. Twitters ad platform is improving every day. I use it. I know. I had my first meeting actually with a twitter ad person that theyve hired to assign to me. Which six months ago i couldnt get anything from the platform. Theyre making huge improvements and have good engage and results, actually. Were in facebook and twitter. Wee look these stocks. We like yelp as a company. As soon as it starts going finishes going down that might also make a good investment. Im waiting on the facebook call. Marketers spend their money on google and facebook. People dabble in twitter but its all performancebased. If you can get the performance you want at a great price, atlas is sophisticated. Why do you need to spend money on pandora or other stocks . Get your customers where you need them. Thats game over for all these other stocks. Facebook most people only get a Little Information from facebook. Theyre on other platforms because its all ads. Twitter, i use it 10 15 times a day. But have you ever click on a twitter ad in yourself . Yes, i have for app installs. Absolutely. Its great for app installs. Not me, not me. Alibaba and zinga, would you buy them both. I would buy neither. I dont like neither of them. Some exceptions. Ross, thank you. From investorplace. Com. Were there. How much time . 17 minutes left she was about to say. Starting to pick up pace a little bit. The dow is up 171 points the s p is up 20. If we wait long enough we may hit 5,000 any moment on the nasdaq. In the wake of a fiery Train Derailment the federal government unveiling new rules. And we head down to louisville where dominic chu is patrolling the back stretch and tracking the big bucks of derby day. More closing bell right after this. If youre looking for a car that drives you. And takes the wheel right from your very hands. This isnt that car. The first and only car with direct adaptive steering. The 328 horsepower q50 from infiniti. Doug. Youve been staring at that for awhile, huh . Listen, Td Ameritrade has former floor traders to help walk you through that complex trade. So youll be confident enough to do what you want. Ill pull up their number. Blammo. Lets get those guys on the horn. Oooo looks like it is time to upgrade your phone, douglass. For all the confidence you need. Td ameritrade. You got this. Before i had the shooting, burning, pinsandneedles of diabetic nerve pain, these feet grew up in a family of boys. Married my high school sweetheart. And pursued a degree in education. But i couldnt bear my diabetic nerve pain any longer. So i talked to my doctor and she prescribed lyrica. Nerve damage from diabetes causes diabetic nerve pain. Lyrica is fdaapproved to treat this pain. Lyrica may cause serious allergic reactions or suicidal thoughts or actions. Tell your doctor right away if you have these, new, or worsening depression or unusual changes in mood or behavior. Or swelling, trouble breathing rash, hives, blisters, muscle pain with fever, tired feeling, or blurry vision. Common side effects are dizziness, sleepiness, weight gain and swelling of hands, legs and feet. Dont drink alcohol while taking lyrica. Dont drive or use machinery until you know how lyrica affects you. Those who have had a drug or alcohol problem may be more likely to misuse lyrica. Now i have less diabetic nerve pain. And i love helping first graders put their best foot forward. Ask your doctor about lyrica. Welcome back. The nasdaq just a hair away from 5,000. Its up 58 points. Well see if it can close out the first trading session of the month there. The outperformer on whats been a strong day on all the major indexes. The volume bill is lighter than yesterday. In other news four trains carrying crude oil have derailed in the United States and canada since midfebruary. Those crashes have caused millions in damages, polluted waterway waterways, theyve cast a new light on Freight Train safety. The recent oil boom has increased rail shipments and is partly to blame. The federal government is moving on new rails to ensure safety. Here with the details is morgan brennan. This is for tank cars haul ing crude. In terms of the rules, the biggest change requires all tank cars to be equipped with a new braking system. The cost of which will fall on the cars owners which are Energy Companies or the manufacturers who lease them out. That goes into effect 2021. In addition, new tank cars will have thicker steel walls. That have to be thermally line tougher valves more protection at the ends of the tank and outer shell. Older cars will have to be fazed out over three years. Older cars have to be retrofitted. The new braking system will increase costs after two years in the making these rules finally provide certainty to railroads and tank car manufacturers. Thats the big takeaway. Thats why youre seeing shares of both groups higher particularly the manufacturers which will benefit from more orders. You can see here shares of greenbrier, Trinity Industries and wabco are soaring on this news. Big moves. 7 8 for some of those names. Thank you, morgan. The dow up 163 points. Did he have imbalances . He said about 100 million to buy. Much more ahead on closing bell. Coming up right after the bell walter isaackson will join us on the panel and becky quick will join us after the hathaway meeting with a very special guest. Wonder who that could be. Stay with us. Back in two. And rebalance your portfolio. I can do a lot of what humans can. Except have a real conversation. If youd like that, you can always speak to someone at schwab. They arent algorithms. Try not to hold it against them. Say hello at intelligent. Schwab. Com your moms got your back. Your friends have your back. Your dogs definitely got your back. But whos got your back when you need legal help . We do. Were legalzoom, and over the last 10 years, weve helped millions of people protect their families and run their businesses. We have the right people onhand to answer your questions backed by a trusted network of attorneys. So visit us today for legal help you can count on. Legalzoom. Legal help is here. Well. The body guards in the market have to do well, kelly. The small cap ss. The body guards of the market. Morgan stanley believes that ie the Interest Rates will go up in the second half. S when the banks start to do well thats a canary flapping its wings and feeling good in the coal mine rather than feeling ill and sickly. Always nice to see you, sir. Nice to see you. Happy may. Happy may day, yes. Were coming back with the closing countdown. After the bell well go live to Churchill Downs and show you what kind of seat you can get if you fork out 13,000 . If i fork out 13,000 i want to be sitting in a saddle. And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. Why pause the moment . Ask your doctor about cialis for daily use. For a free 30tablet trial go to cialis. Com we will rock you anthem call 1800royal caribbean or your travel agent today about two and a half minutes left. Let me show you what happened this week for the dow. Dow move were higher today but on lower volume as art cashin kept pointing out. For the week were down a third of a percent. The tenyear yield and how we did for the week as stocks were moving lower, bond prices we got the yield now at 2. 11 . The high for the year is about 2. 25. Were starting to move back in that direction there on the tenyear yield. Joining me right now, our friend bob pisani from etf securities. I ran into an old friend today coming into the New York Stock Exchange where w. H. O. Has been in the market for years. Hes very well known in a particular area. But he said to me very excitedly, i started an etf today in a completely different area. The first thing i thought was, are etfs starting to jump the shark here . Theyre jumping. Theres been a lot of flows, mainly inflows, about 71 billion, which is pretty strong. Theres been outflows out of s p beta type u. S. Traditional market cap type. Its going overseas . Its going overseas global, europe fixed income diversified. We have europe deliberately weakening the euro and products that hedge out currency effects over there. Its Little Wonder that people are going to europe. The products are more diversified now. Are we going to get to a point where we have too many of them . That was basically my question. Thats unlikely. Youre asking an etf guy. The trends are significant. Its that transparency, the cost effectiveness. You can trade them intraday versus the competition, mutual funds. That trend is significant, basically 15 now. Theyre beating out mutual funds. 1,500 etfs, only 25 or 30 have the really big volume. By the way, ism Services Number shortage of skilled workers several times mentioned. I think were getting pressure on this. Were going out on the highs of the session, the dow up 180 and the nasdaq very strong as well. Stay tuned. Second hour of the closing bell with kelly evans and company. Have a good weekend. Thank you, bill. Welcome to the closing bell, everybody. Im kelly evans. Heres how were closing out the week but beginning the month on wall street. Its with green arrows. The dow adding 179 points. Almost a mirror image closing at 18,020. About a 1 gain for the s p, the broad market index up as well, back above 2,100. The nasdaq having a strong session. Its been a tough week for the nasdaq, a tough week for biotech and social media names. Today a bit of a rebound, up 1. 3 . 64 points and closing back above 5,005. Evan newmark is here Kayla Tausche is with us as well. And tim seymour is also here. Are we going to hold above 5,000 on the nasdaq . I think so. Its may day, kelly. I just got done dancing around the may pole this afternoon. Because you think youve been right. I actually i want to reflect on three consensus trades that a month, month and a half ago many of your panels told me they were definitely going to happen. One was the euro the euro going to parody against the dollar. The second was the price of oil. Oil going to 40 or even lower and the third one was the bond yields going lower, the tenyear was supposed to go down to 1. 5 again. Right. All three of those totally wrong. Totally wrong. There could be an aberration and a broader trend. I think the trends are broken. Thats what im saying. Its an interesting day. The trends, i this i, are important. I think the trends have been broken. Im not saying its going to move raptly on all those things. The consensus was very wrong. I like the way you frame this. Walter isaackson, in that category of trends being broken would you put some of the social media names who are really getting hurt this week . Yes, although its good today. When you get to social media, one of the problems is more systemic. When you see a meerkat or periscope or a social media phenomenon come along, you realize the barrier to entry and social media is a lot less than the barrier to entry than getting into batteries or biotechnology. What do you think, walter of this announcement from tesla last night, this Battery Technology . Weve had the ceo of generac on saying if youre on the grid and think tesla will replace what we do, youre crazy. Rick harrison is off the grid and said he would love this. Thats what we truly need if ear going to get to a smart grid alternative forms of energy. I come from new orleans. Even last week we had a bit of a storm. People use electricity. Whether its you as a person or the country as a whole, i think Battery Technology is the one we have to watch for. Im not sure which will be the best but it will be a great field. Its a field unlike social media. You cant do in your dorm room or in a garage. Kayla . While no one is doubting teslas and elon musks ability to refashion the battery, there are concern that this is maybe a preearnings diversion. We could be gearing up for next week numbers worse than expected from tesla. So cynical, kayla. Thank god, that you have somebody cynical. I thought i was the cynical one, we all had to come around to your view. By the way, i think the cynicism is good and i think by the way that what happened with the social media stocks and the biotech stocks over the last few weeks, thats all actually really good. I think its a good thing. I dont think a lot of the valuations are justifiable by any means. Tim, a quick word to you. Youre talking about all things. Evan started with positioning, a contrarian view has held you in Good Standing in if youve been playing oil or the euro. I think the dollar is oversold. I would be buying the dollar. I shorted the euro today. I look at commodities. Thats one of the trades that so far hasnt gotten out of the longterm positioning. I think commodities are bottoming. Copper has outperformed and i think Companies Like freeport and bhp and rio tinto have parts of their business that are really starting to work again. Over to social media, positioning got to be too euphoric linkedin versus twitter, which one of the moves was more overdone . Probably linkedin. Growth cant be what it is. The moral of the story is be careful where people are overpositioned and do your work. Valuations do matter. Its a point. Lets hold that thought for a second and hone in on whats happening in the energy space. Even amid these battery announcements, crude oil, posting another very strong week despite losing gains today, jackie. What are traders saying about it . Hi there, kelly. It was a strong week a strong month for crude be up with nearly 25 . Kind of like what tim was saying about commodities generally think crude oil prices will go higher from here. Whats interesting is that you youve got dollar it was stronger today. Thats why we saw selling pressure. Trayers saying on the last day of the month, that would be yesterday, we popped so high. Its not surprising that wed close today with profittaking but having said that rig counts came down again. The rate of decline is slowing a bit but traders feel there is going to be that Tipping Point when you start to see those production declines happening here in the United States as a result of the precautions that are taking place. Having said that we try to make a run at 60 yesterday. It didnt necessarily happen but next week its definitely in the cards. Its a point, jackie. Thank you. Evan, you brought up oil of one of those everyone thought was going to 40. Im not sure thats the case. Weve had a lot of people saying all the way down that its going to come back up. Im touching on especially im not trying to be critical many of the trading types who you have on the show. They tend to be momentum players. When the momentum gets strong like it did against the euro like it did against oil and like it did for lower bond yields you tend to have a lot of people talking the trend. A lot of traders are momentum players. All im saying is when people are saying that it has to happen, when the dollar has to go to parody against the euro you should always step back and go, maybe not. You want to defend the Trading Community . I dont know. I consider myself someone that found oil to be way overstated. What i was going to say to counter what evan was going to say, the guys that are close to the action and fundamentalists an bottom up players in oil are the ones that have been the most bearish. Theyve been the ones that piled in at 40 or 45 or 50 and said it could be going to 35 or 50. Thats the problem. You have the same guys in the tech world that were upgrading the earnings after stocks had 60 runs. You have to be very careful about the guys making the calls. The oil move, a lot of that was the dollar move. Remember, it wasnt just about supply. A lot of it was in correlation to the dollar. True. I think what tim is saying about valuation is really key. You cant necessarily tell. Ill use myself as an example. I wrote in a negative piece when i was at the wall street journal on linkedin called linkedin at 10 billion, linkedin stupidity. Okay . You know the stock the company was worth 40 billion up until the recent pullback. My point is you can be wrong on valuation for a long period of time. I still wouldnt buy linked in. Its trading at 15 times revenues. You have to believe in that. Let me bring in walter. Real quick walter talk about apples valuation here. What a tough week for this name. Why do you think sentiment has changed . I think the numbers coming out of china were good. There was a glitch with the apple watch production chain. You know its a very Creative Company and once again, the fundamentals are great. And the watch, walter, early reviews, this thing about the supply chain problem the journal reported we were going to have are we going to look back on the apple watch and say we underestimated its potential . I think wearables will catch on a lot. We will need them. I think apple will do it in the most beautiful way. Theres a fundamental demand for that. So i dont know exactly on the valuation but its not going to be a bubble. Walter the most important question is are you putting your wrist tattoo on hold so that it will read your apple watch . You know the apple watch is Something Big when youre reading stories about how not to get tattoos because of it. A transformative moment for the skin tattoo industry there. Go short on tattoos. Exactly. Tim, what are you going to be watching into next week then . What will be the catalysts for the next move in this market after weve just come down a big down day, a big up day. Watch credit spreads, where yields are going. People get unnerved this week. 2 european credit spreads on the periphery. Those have been places that people have been concerned. Youve seen spikes there. Maybe its a function of greece. I would be watching that. Again, watch things like copper which are more related to the growth of the Global Economy which continue to work. I think you should stay there. Hes retaining his dr. Copper name for now. At 5 00 on fast money, they will ask scott sibella, coo and president of mgm grand. Is Silicon Valley under attack overseas . Well talk about that next. And the drones are coming. Its not just amazon that will soon be using them. A new Study Reveals how integral drones willing for our economy and safety. Youre watching cnbc, first in business worldwide. Silicon valley under attack. The eu launching a case against google and uber Office Raided in china. Lets ask our panel. Walter youve seen the barrage of headlines lately. Why is it that Silicon Valley seems to be a target for the taking for a lot of other countries . I was in london about a month and a half ago with eric schmidt of google. Part of this is resentment to American Companies with their own values and privacy, having all the data being so dominant. Theres two things at work here. First of all, these are noneuropean companies that seem to control a whole lot of what the market is going to trading markets, you know how you can sell things. Secondly, theres a different sense of privacy in data there, the right to be forgotten is a big thing there. And i think that we have to put ourselves in their shoes. Imagine if there were a Chinese Company that controlled all of our search and had all of our data. For that matter even a german one that did. I think part of it is legitimate, you know questions. Sure. Some of it is just sentiment, almost a worrying about American Companies dominating the internet. Evan . I think a lot of it its tough to talk about, but a lot of it is envy. What i mean by that is europe has failed with the exception of s. A. P. Nokia had a run at it for a while while. I had a company, it was a pan European Tech company. Until youve done Something Like that you dont appreciate how hard it is to do in europe. Its less regulatory, more has to do with the culture. Its almost impossible to replicate what Silicon Valley has in terms of culture. Kayla . Having spent the week in san francisco, one thing we were struck by is the Optimism Level and how there seemed to be a perception on behalf of founders and bankers and executives out in the valley that theyre in a bubble but not necessarily a valuation bubble. An optimism bubble . Their world is the only one that exists and theyre in this position of often times asking forgiveness instead of permission. These regulatory committees push and push and push and push until one of the countries has to push back. Thats when they have to ask forgiveness. U. S. Companies, im thinking about google and the way it invaded some of the Wifi Technology to get data for its google maps. There have been instances and the u. S. Government hasnt helped perhaps with u. S. Equipment again has been spying on other countries. There is paranoia that is justified in the case of some of these other countries, isnt there . Even paranoids have enemies at times. I do think theres a fundamental cultural difference as we said a moment ago. Part of that cultural difference is theres a strong sense of personal privacy. Especially among the Younger Generation you dont see quite as much. When google is coming up with these thing, its a bit of a flurry. Its not the end of the world. Rand paul when i think about his candidacy and what he represents to a lot of the younger people he does have a strong theme of privacy, kind of keeping our government from being big brother and getting all our data. Hes not actually attacking google, is he . It is tied together. Yet somehow in the United States were not quite as comfortable with American Companies as they in europe. In europe its almost look a van waiting to explode. I think if europe had a couple of National Champions that could compete head to head with the microsofts or the intels or the facebooks of the world, you would hear a lot less of this. What about china . Theyve had plenty of startups big and successful. Yet theyre still going after uber. The europeans, the state in europe is a lot more intrusive in terms of the individual lives, what you can and cant do. We have the bill of rights in the United States. Theres no comparable thing. Eye ronironically, that might be why were comfortable with our sense of privacy. In china its competition. They want to make sure they have their own whatever you want call it. Something in the hunt. Whatever it is in the hunt. Dog in the hunt. I think they want to control the free flow of information. They dont necessarily want american Search Engines allowing people to get what they want both controlling things commercially. Theyre far less comfortable than we are with the free flow of information, just like europe is far less comfortable with things that can be considered privacy violations. We have breaking news to get to on bird flu out in iowa. Morgan brennan, whats happening . Officials in iowa are holding a press conference. Iowa governor declared a state of emergency tied to bird flu. He said this is Effective Immediately until the end of the month. Its, quote, necessary to access more resources as this bird flu outbreak continues to escalate. Officials also announcing four more new probable cases. It brings the total number of cases in iowa up to 21 across ten counties. Thats including confirmed cases as well as presumed positive cases. Just to put that in context, weve seen all of those cases spring up over less than two weeks. It also means that were looking at somewhere in the realm of 14 to 15 million birds that have been affected just in that state alone. Couple that with other cases being confirmed by the usda. If we get confirmation on all of these cases going on and in different parts of the country, were looking at more than 20 million birds affected. Iowa declaring a state of emergency, tied to this bird flu outbreak. Its joining minnesota and wisconsin in that move. Back over to you. All right. Wow. Morgan, thank you very much. Continuing to follow this story for us. Look very closely at this next video. Youre going to see a drone spraying graffiti on a calvin klein billboard in new york city. A new study fons they might be integral to public safety. Well talk about that next. Were just a little more than 24 hours away from the Kentucky Derby. And a look at the most expensive seats. You wont believe how much they cost when we continue. Can help you take it on. Tdd 18003452550 were getting a lot of questions tdd 18003452550 about organic food stocks. 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S. Trying to get drone use approved for similar Disaster Relief. The American Red Cross has teamed up with measure, a Drone Services company to put together a study on how drones can help emergency workers in those relief areas. Joining us now is the ceo and founder of measure, brandon torre. Thank you for having me. Make everyone aware how restrictive our drone policyies are in this country. Currently the faa doesnt allow drones to operate. Its practically illegal for the American Red Cross or Insurance Companies to operate drones here state side even in the event of a disaster. The commercial lose uses one thing where weve seen companies trying to get exemptions. The faa may be showing signs of loosening up there. What about for Disaster Relief . Yes, we did a study with the American Red Cross and the number of Corporate Partners including u. P. S. And zurich insurance. What we found is we think drones can provide imagery within 24 hours to help identify people and collapse buildings. Its really about saving lives. Its about quickly rebuilding communities. If we can get these drones to be up in the air within 24 hours of disaster we think we can make a difference. Often times it takes getting very close up to assess the damage Something Like this. What type of Tech Knowledge are the drones unite rising to be able to identify people in buildings that have collapsed . Sure. When you think about a collapsed building, you have to think about drones that can carry infrared cameras. It will be able to detect a heat signature of a person or persons inside that building. For example, in nepal, the most important thing we can do when we respond to a disaster is get the resources there as quickly as possible and help responders get to people in those buildings as quickly as possible. If we can equip a drone with an infrared camera, we can more quickly identify those people. I have to ask, we were having a conversation about education in Silicon Valley. Are we being too restrictive . We probably are being too restrictionive but i liken it a bit to the fda and approving drugs. Im sure were leaving certain kinds often know vagus and helping some people behind you want to make sure you have something in place that will hold water, that will stand the test of im. Im surprise in terms of coming up with sensible drone policy there are people in the government i hope there are people in the government foiging out the rules and regulations for the drones. If you say laissezfaire, do whatever you want its just a matter of time before someone takes the plane down. Weve seen a number of reports about drones near air space. A lot of that are people working at home in your bank yard. Even as other players get into this game what happened to the entire industry if the government ultimately decide be to be more restrictive and go a different way . I want to say the faa participated with us in this study from the beginning. We realized early on that we needed the fap as a partner. They are the regulatory body thats going to decide whether or not we can supply post disaster. To answer your question more directly, yes, look we have to put all the Safety Measures we can in place. The United States has the most crowded air space in the world. As a company we operate our drones and make sure that we only fly when its safe. Drone operations for commercial purposes should operate that. Brandon, i final point. Isnt it the case a Chinese Company, dji. Theyre absolutely the leader in the consumer drone space. When you look at the industry theres a number of Different Companies out there. Probably well over a thousand. When you look at the needs of zurich and exxonmobil, when it comes to drones. Yes, gdi is going a fantastic nobody getting the information out there. Well see if on the commercial side if theres a bigger player coming to the fore. Thank you. Appreciate it. Time now for a cnbc news update with sue herera. Heres whats happening this hour. Tesla going into the used car business. The company has begun useing selling used versions. Company offers an extended warranty on used vehicles. A former Goldman Sachs employee was convicted on charges of stealing codes. The jury was dead looken on a third count. Police and may day dim demonstrators clash eded. As many as 10,000 Police Officers were reportedly called in to block the protesters. Its the end of a labor day tradition. The muscular dystrophy announced it is pulling the plug on its annual telethon. The new realities of tv viewing and philanthropic giving made it the right time to sign off. Your up to date kelly. Back to you. We certainly are. Sue herera back at headquarters. Six Police Officers in baltimore facing charges in the death of freddie gray. Chuck todd weighs in on this developing story when we come right back. Can it make a dentist appointment when my teeth are ready . Can it track my crews performance, and protect their heads . Can it tell the Flight Attendant to please not wake me this time . At cognizant, we see opportunities for every company. To meet the new digital demands of their customers. Can it process my Insurance Claim . Like, right now . Can it download a track while im sampling it . Can my keys find me . With the power of digital, analytics and automation now every little thing can provide even greater value. Ok, so can it tell the doctor how long you have to wear this thing . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Six baltimore Police Officers charged today in the death of 25yearold freddie gray. Baltimore state attorney filing homicide charges stateing grays death occurred while he was in police custody. Speaker of the house weighed in recently about the citys damage. Ive been inspired by the stories of residents banding together to clean up the damage. Now, the president had suggested more taxpayer money is the answer. Again, we believe the answer is more jobs and more opportunity. Joining me for his reaction meet the press Moderator Chuck Todd along with our panel here. Welcome back to the show chuck. Good to see you, kelly. You actually have the speaker on the program this weekend along with governor Martin Omalley whos been a president ial contender to some extent. I imagine well hear two very different narratives about this. The speaker is going to say, as he just did that baltimore needs more jobs and more opportunity. What does governor omalley say . I think it will be interesting to see. Ive interviewed Speaker Boehner on this. We did release a bite one part that were previewing is he did call the issue of africanamericans and the distrust with Police Officers and vice versa here a National Crisis that needs to be addressed. And thats, i think, some look, words matter when it comes from our political leaders. Its obviously the solution and where to go from here i think is,s you know division is very different. But acknowledging that this is now a crisis situation i think does matter when it comes to the speakers words. As for governor omalley, he wants to in part defend his tenure as Baltimore Mayor and discuss why he did the things that he did. Baltimore had a very high crime rate at a time when the rest of the countrys crime rate was falling when he took over. The question is were his methods effective . They brought down the crime rate but some will argue, did it actually plant the seeds for some of the problems were experiencing today . Thats up for debate. Let me bring Walter Isaacson in here. What do you think is effective in terms of solutions or methods to address it . I think chuck is exactly right. The fact that Speaker Boehner says this is a National Crisis important, because words matter. Secondly, its not just about policing. And once again, i think that John Boehners words, though couched in political rhetoric were important because its about opportunity and its about jobs. This is incredibly important right now that we have a National Conversation about a whole segment of our society. Especially men and boys of color in urban areas that have been left out of this recovery. And this is such an astonishing big deal that we often dont process it. And thats what this is all about. I think if Speaker Boehner is going to say we need opportunities for people like this, we need jobs for people like this lets go for it. Evan . I understand why some would be calling for a National Conversation. My question for you, chuck, is there anything that new here in the following sense . Im not talking about the Police Brutality or the individual debts. Im talking about the state of certain urban centers for the last 30 40 years has frankly been in crisis or quasi crisis for 40 or 50 years. Detroit, newark, parts of cleveland, milwaukee. Theyve been very, very troubled for a very long period of time. As im sure john boehner will point out, they have been ruled in large measure by democrats for the last 40 or 50 years. Is it a new National Conversation . Not at all. One of the things im going to bring up sunday, next week, may 5th is the anniversary of the moynihan report. The timing of this 50th anniversary, i think, couldnt be more significant when you look at it because when you read the report as ive been spending all week doing, rereading the point, you realize exactly your point, evan. Here we are, 50 years ago Daniel Patrick moynihan chronicled this issue and, look we have to figure out. I think we talk about the different intercity issues. Lets go to baltimore. There was a constant way of how bad neighborhoods were dealt with. They essentially got isolated. They got isolated by the policing community because they assume anybody in that neighborhood was potentially a criminal. Thats how you built the distrust. There was sort of this and look, i know people want to make it partisan or ideological. I dont think it was that. I think it was a collective decision to isolate bad communities in every city and think, if you isolate it, it will eventually go away go away as a problem and you can rebuild parts of the city. Thats now the mistake that if everybody looks back on that was the initial sin here if the decision by the political elites at the time essentially hope you can cordon off quote, unquote, bad neighborhoods. If there was ever a time for bad approaches this would be the time. Chuck todd is meet the press moderator. Join him this sunday. Hell be joined by john boehner to discuss baltimore on the political landscape. Warren Buffetts Berkshire hathaway ready to report earnings. We have a special guest standing by. Plus the run for the roses kicks off tomorrow and you wont believe how much youll have to spend if you want the ultimate Kentucky Derby experience. Back in a moment. Renters, rail and racing. They all have cnn. Com buzzing today. Allen wastler jones us to explain. We get a concerning renters piece that all our readers are diving into at the moment. One in four renters actually pays more than half of their paycheck for their rent. That violates all sorts of rules of thumb about only a quarter of your paycheck. Kind of concerning. Shows how wages arent really keeping pace with real estate cost of living increases. Thats a big one for us. Another one, we have a bunch of rail executives talking about the possibility of maybe railing water from the east coast to the west coast. All these rail Water Project stories have been getting a lot of attention on the website. A lot of people think it might be cost prohibitive. Still, very to do something. Finally, big weekend coming up. We have Kentucky Derby, the fight, nhl, nba playoffs. We have age of ultron. We have a game plan for people. Look at the schedules, our game plan. And how to fit it all in. I love it. Thank you so much. Enjoy the weekend. I will. Take care. Im thinking of times when i first moved to new york i think i paid 80 of my income in rent. That 50 figure that he mentioned doesnt surprise me. The cost of Home Ownership is so cheap, as you, a new homeowner would understand. Now i know. Now i get it. I like that allen blames basically the lack of rises in wage growth. But it could equally be unrealistic real estate expectations for young people which those of us living in new york are guilty. Youre familiar with that one, too. 20 horses will compete in tomorrows Kentucky Derby. While theyre running for the roses, the super rich will be sipping mint jupleps. We take a look at the elite seats at the track, thats up next. Closing bell back in two. Excellent looking below the surface, researching a hunch. And making a decision you are type e. Time for a change of menu. Research and invest from any website. With e trades browser trading. E trade. Opportunity is everywhere. I think about the shape. I think about color. I also think about sound. I take it into my brain and i think about. What would it look like to me . My tin man has a big toe the size of a house. The lion is small like a toy poodle. It has webbed, duck feet. And he is very scared of everything. My scarecrow has wooden teeth. His fingernails are really long. And his clothes have tubes on them. Somewhere over the rainbow somewhere over the rainbow and thats dorothy. She looks like me. Everyone has a favorite movie. Now people with visual disabilities can find theirs. Comcast is proud to introduce the First Talking guide. From xfinity. Tomorrow marks the 141st Kentucky Derby. Dominic chu is already at Churchill Downs. He now has a behind the scenes look at some of the fanciest seats in the clubhouse. Hi, dom. Hey. So kelly, this uniquelooking thing is your ticket to ride if you are part of the elite at Churchill Downs. What it gets you into is something called the mansion, the sixth floor here at the Churchill Downs facility. What youve got here is a situation where under 300 people get invited to buy tickets for this. It will cost you around 13,000 apiece. Even if youve got the money, its not necessarily that youre going to get into the mansion. What this mansion admission ticket gets you is a whole bunch of stuff, a personal concierge, a chauffeur to drive you around Celebrity Chefs to come in and cook for you. All of this happens at the sixth floor here. It includes so many different things. When youre talking about the alisters, the hollywood people, the business tycoons, a lot of them will be at this 13,000 mansion. Thats not for everybody, obviously. Guys like you and i, we can just walk up to the gate this is what i would do, pay the 50. You get access to all the grounds, the paddocks. You can go to the infield, watch the race from there. Its who most people like i would do. Its interesting to hear they sell about 300 of these tickets and they keep a handful in reserve just in case you and all the other stars out there decide to make a lastminute reservation with the mansion. Make the call if you want. Ill keep that in mind. Somebody with 13,000 to burn is this worth it . I dont see the point in spending 13,000 to lose money to gamble on a horse race. No one says you have to gamble. You cant show up and spend 13,000 for the pigs in a blanket and wager like 2. You have to go to the window with confidence. Oh, come on. You have to lose at least that much betting. Its a 25,000 minimum. If youre paying 13,000 for seats, you probably have money burning a hole in your pocket to gamble. Probably. Id rather get mint juleps. Are you a derby guy . Im definitely a derby guy. Ive always liked the infield. Its a great race this year. Its like the stock market too. I always believe in looking at fundamentals. And carpe diem is the fastest horse, long odds number two oust the gate. If you look at the its fun to look at the horses. I think id rather watch it from the infield, but ive in had a chance to be in the mansion. This is Walter Isaacson whos wrote some of the great biographies of our time. Turns out, hes a horse handicapper in our time. Im shocked. In college, we spent a lot of time at the downs, and the fairgrounds in new orleans. I mean that is a place to be. And you know i think id probably rather bet on a horse than try to figure out what soandso networking stock is going to work. Next time im going out to belmont with him. Maybe we can get lucky. Belmont noose a couple of weeks. Walter likes the stock market, but there is a stock market angle to this because our team crunched the numbers this morning and found that a handful of derbyrelated names, like yum brands which islouisville as well as consolation brands with a lot of bourbon names in its portfolio, both names traded positively 80 of the time on the friday and monday around the derby. I dont know dom, is there a lot of pizza hut and taco bell consumption going on out there . I dont know about a lot of the consumption, but what i can tell you is when you fly into louisville this place is full of logos, of kentucky well i should say, i guess its kfc now, kfc, taco bell pizza hut. You see the corporate logos everywhere. And remember, guys this is the 141st running of the Kentucky Derby presented by yum brands. So, that just goes to show you how big of a presence yum is right here. Oh, wow. All right. Kelly, one more point is that every now and then a new liquor becomes a hot thing, whether its vodka. Weve just gone through a tequila phase. I think bourbon is the next big thing. Well be seeing that this weekend. You heard it here first artisinal bourbon. Dom have a lot of fun this weekend. Greatest two minutes in sports other than maybe that fight saturday night as well. 141st running of the Kentucky Derby, tomorrow 4 00 p. M. On nbc with early coverage beginning at noon on nbc sports. The wells fargo stagecoaches are, meanwhile, rolling into omaha omaha. 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I am here with john stumpf who is the chairman and ceo of wells fargo. John, thank so much for joining us. Its a pleasure. Nice to have you here. I have a million directions we could go with this but why dont we start out with the fact that you are the largest Mortgage Lender in the United States. You have a very good idea about whats happening with housing. How would you characterize the Housing Market and demand for home loans at this point . Well, we came into the Second Quarter with the second largest people line weve had in a couple years 44 billion. And were really into the spring selling season. Well see how it all works out. I think its going to be better but surely not a boom time. And theres a couple reasons. Theres, you know student debts a big issue, Household Information happening later, people renting, and perception is that credits not as available, but it really is available now, and at great rates, very affordable for housing. Over the last several years, weve had several conversations with Warren Buffett, where he has said if you want the best deal out there, go buy a house and get a 30year fixed mortgage. Correct. Because its a massive advantage to the consumer when were at basically zero percent Interest Rates. Its a loan that you, the consumer call at any point, the bank cant. You have the optionality. Right. Why do you want to option any of these fixed, 30year loans . Well, we dont hold those on our balance sheet. We originate those and investors hold those. Dump them off. So, a 4 asset is probably not a bad asset. Are you frustrated with the Federal Reserve remaining at zero for so long . Well i dont know if id use the word frustration. I think rates should normalize and equal the strength of the economy, and that surely is on the short end more than zero. So, im hopeful that theyll lift off. I would think it would be september and probably 25 basis points. But i think youre going to see more a flattening of the curve. I dont know that youre going to see long rates move a lot. Because . Europe is weak you know qes around the world. Any time Interest Rates pop up the tenyear pops up over 2. Or 210, there are so many buyers out there, so i think that will keep the rates down for longer. At least thats my view. The deal you just did with ge capital was a huge deal. Theres been a lot of speculation about other deals that you might all do. One analyst on the street said as a result of wanting to buy additional loans from ge maybe from other places wells fargo might stop doing as much in terms of buyback and keep that money share buybacks and keep that money to go out and do other deals. Is that a fair characterization of what might be happening down the road . Well i wouldnt want to comment on that but let me just say a little bit about the ge thing. This is kind of a once in a generation event. A large player competitor exiting, you know certain markets, and we love the commercial real estate business. We put 9 billion on our balance sheet. Things had fit our portfolio in terms of rate loan devalue and the kind of things we do. It looks very similar to our portfolio. And of course we finance blackstones trust. So, we love that. If we do no more thats great, if we do more, thats great, but i dont think it will have a big impact on our buybacks. I have a million questions to ask, but we are up against the end of the hour. One thing, though, is output of school, just into banking, you were a repo man, and i wonder who you learned about banking from being a repo man . Thats a long time ago. It was 1976. When you collect somebody elses bad loans, you sure learn a lot about making good loans four yourself, because bad loans dont help anyone not the consumer, not the bank the investor, stock holder anybody. So, that was probably the biggest lesson. John, thank you so much for your time. Sure. Nice to be here. Our thanks to becky quick and wells fargo ceo john stumpf there at the Warren Buffett confab in omaha. What did you learn about his remarks . I think its kind of consensus. I would say his view is kind of a consensus view flattening of the yield curve. I hope hes wrong. I hope the economy is actually stronger than he seems to be imputing right now. In his point, kayla, he says people think theres no credit out there, there is. But he did say housing will be better, but not a boom town which is different from what he said in the past. He said that refi activity would give way to purchasing activity. That hasnt happened yet. And that could hit wells fargo going forward, if its not stronger. We need more kelly evans ees out there. Kayla, youd better get out there and start buying walter quick word here . I think it was poignant about what he said about being a repo man. You realize that these are real humans and real consequences. Right. And we ought to not let that housing bubble happen again. Well we appreciate you all being with us this afternoon. Well leave it there. That does it for us on closing bell. Have a great weekend, everybody. Its time now for fast money. Live from the Nasdaq Market sight overlooking new york citys times square this is fast money. Im melissa lee. Our traders tonight are tim seymour, steve grasso, guy adami. Just over 24 hours until the fight of the century and we are going live to the heart of the action in vegas, the official weighin, about to happen in a matter of moments. The president and coo of mgm resorts joins us live from inside the venue. Plus tesla energy launching with i charge but will the real electricity come from earnings next week or is the stock about to burn out . First, we start out with the majority market, because it was a case of the good, the bad and the ug