Transcripts For CNBC Closing Bell 20160512

Meantime, a war of words on cnbc between j. P. Morgan head jaime diamond. Tell you whats behind that controversy thats been brewing for a while. After the bell, wilfred frost has an interview with bank of america ceo, Brian Moynihan. Stay tuned for that. Look forward to that very much. Now, the retail pain. Shares of coal sinking again. The hard times for traditional retailers might not be over anytime soon as amazon continues to outperform. They were out yesterday with a note reiterating the preaddition that amazon could become the top clothing Retailer Next year, 2017. How big of a threat is amazon to traditional retail . Lets bring in stacy and cou Courtney Reagan. We are getting horrible numbers from macys and kohls and others. Is everybody migrating to Online Shopping right now . You know, i dont think its just that simple here. Everybody is blaming amazon and saying, all of a sudden, what is changed . Amazon has been around for a while. The numbers are getting worse. Macys traffic was down 7 . Kohls traffic was down 4 pk . I think the consumer is under a lot of pressure. The other issue, a lot of companies are chasing the same growth categories. You know, growth has hit the wall. Courtney, Morgan Stanley out with a note about the amazon impact. Basically sees amazon and the Department Stores changing hands here. Amazon is 7 of apparel sales and could go up to 19 or 20. The exact opposite happening with Department Stores. I dont want to say i dont believe amazon could do it. Certainly, they have exerted strong dominance but clothing and apparel is tricky. Online returns for clothing is something in the range of 30 to 40 . When its instore, the return level is lower, Something Like 1 10 to 12 on average. If you want to make it profitable, its harder to do online. You have a lot of people that dont love going to the stores, but also dont love returns or getting a sweater that doesnt look like the quality they expected and fit is an issue. Doesnt mean amazon isnt taking share, but its not as easy to pull someone to shop for clothing as it is for toothpaste. I have been saying for years, its not brilliant on my part, but there are too many retailers out there. Are we starting to see that come home now as retailers, as you and courtney were saying, you are going after the same growth categories. Too many retailers chasing the same customer. I think thats a great point. While there are store closings starting to trickle down, we need a good 25 Square Footage haircut in general to the space. The other thing courtney pointed out is very important, not only is amazon going to struggle with the exchange and return rates, the company that is are transitioning online like a nordstrom, 20 of their business is online. They are struggling with the higher cost of being online and the higher cost of dealing with exchanges at the same time their brick and mortar operation margins are going down due to lower sales. Regardless, who could sell through Department Store and who could sell through amazon. Pvc, haines and childrens place. Some poised to benefit in either world, i think. Looking at amazon for a long time, the clothing manufactures and vendors look at them as a competitor. As they have seen consumers migrate there for a shopping platform, if you cant beat them, join them. You may have to go there. Im concerned about their dominance in taking their share. I worry what it does to the consumer if amazon is so powerful all commerce goes through there, the choice is limited. Are the choices going to go up . I worry about that. Thats the conversation we had when walmart started to grow. We havent had that with amazon, which is interesting. Tonight, we will hear from dillards and nordstrom. Thanks. Good to see you. Good to see you. Lets get a check on whats pressuring apple shares. Susan lee from the nasdaq side. Hey, susan. Apple macon tribute it to the nasdaq. The biggest point drag on the nasdaq 100. A good volume. This is behind the nikkei report looking at less orders on the back half of this year, which traditionally is a strong time to put in orders. There should be product launches and ramping up for the christmas season. This nikkei report zeros in on the largest contract maker of the world. We are running at 80 of 2015 orders this year in 2016. Theres no comment on this report. They tell the market maybe theres deceleration when it comes to smartphone demand and there wont be Ground Breaking features when it comes to the iphone 7 launch in september. Back to you. Thank you. Susan li at the Nasdaq Market site. We are watching the market capitalization of apple and alphabet formerly known as google. Alphabet has taken over apple here. Its down 32 from the record high, in february 2015. Again, it is the worst performer on that index since then. Not the only time thats happened, but probably one of the more memorable ones in terms of how that works. Highly notable, that is for sure. Difficult for the people on the dow, too. Its not like theres a huge gap between that and how the s p have done. The Closing Bell Exchange for thursday. Michael is back from destination wealth management. We have jonathan from meridian equity from post nine and rick from chicago. Jonathan, whats going on . You have one good rally, then a sell off. We are meandering today. What are you seeing . Look at the volatility and uncertainty we have had in the market this week. S p has had a 30point range. Dow up 2020 tuesday, down thursday. The market is looking for something to hold on to, whether its a good or bad headline, looking for some direction. We get both of each, dont we . Thats the issue. The headlines arent Strong Enough to move the markets, yet they are. Coming into today, with the futures up, markets back and forth. We had to wait until this afternoon, kansas city, fed president , came out with comments. That was something investors were waiting for and looking for. The uncertainty about what washington is going to do about interest rates, they were off the table for june, now back on. Investors are looking for direction. Today might have been a tip of the hand as to what we are going to see next week. Michael, what do you make of the big cap tech names here . Depends on the big cap tech name. I think alphabet certainly is an investable asset. Oracle, we have doubts about. We are not sure how they are transitioning to the cloud. Apple, everyone loves to hate apple right now. It depends on the time. If you buy apple for a twoyear time horizon, when the next upgrade cycle comes in 2017, forget 2016, i think you are going to be very, very pleased with how apple stock does for you plus you get a dividend. Tech, you have to be very careful and not get too exposed. We are seeing a bit of a rotation away from more higher leverage names to value cash flow names. Dividend oriented are going to be key this year. Rick, important treasury auction these last three days. Now that they are done, what do you think . What did it look like . You know, i was so surprised, dead wrong. I thought the 30year would resemble or rhyme with the ten year off the charts in terms of demand. If you look t all three maturities, this is fascinating. Interesting to know where investors and institutions of foreign Central Banks own it. They own three, four or five basis points lower. About the same amount of base points they are losing on tens, we have to see how 30s turn out. Thats not good. When you look at 10year rates, we thought we were going to make a beeline around the mid160s. But, here is the eighth day now, it looks to be a settlement in tens between a 1. 74 and a 1. 79 . Really, sideways is the direction at the moment. I really do think this may continue. One trader said, listen, when i look at the world and see gold, yes, its high but still 600 off the alltime high. When i look at yields, yes, they are low, but havent challenged them for the year. Whats it going to take . Cynicism, if rates arent going below 170, they probably arent going to this cycle. If gold cant make a better beeline for highs, consider whats going on with Foreign Exchange and rates. Whats the better time . It makes sense that markets are not very exciting. I think traders are taking a step back. What is your sense, michael of the picture . You know, rick makes a great point. The underlying story is, perhaps the economy is not as great as everyone thinks. The unemployment numbers that came out, a headline number of 5 , which is great. Below the surface, as steve said, rick pointed out in commentary the numbers arent really that solid. So, from my perspective, if you have low inflation, that is a positive for the economy. What about real organic growth . I just dont see a lot of real, organic growth. Thats why the market isnt migrating higher. Theres nothing to hold on to right now. When you have an environment where growth is sluggish, its tough to have strong rallies. John, i guess thats why theres a lot of skepticism of any rally on the trading floor. Tuesday was a prime example. People looking at each other saying why is the market up 200 points on the dow . We couldnt point to a specific idea. Thats right. There was no real cause for that rally. Thats what investors need to be worried about. When theres not a headline for it to move, expect it to come back. Thats what we saw. Investors are looking for anything to grab on to. We have retail sales tomorrow. We know how thats gone so far throughout earnings season. I think investors are taking risk off heading into the weekend. One thing, the skepticism about the rally and economy has been going on for some time. We have seen huge demand in credit markets, huge issue. Could be a 50 billion week and people are looking to plow because they dont trust equi equiti equities. If they are doing that, doesnt that make the case for stocks longer term while this continues . Who do you want to answer that . I dont know if thats the case. Kelly, i think, yeah, certainly there is tremendous demand, but i dont think, really, the two have much correlation. I think what you are starting to see is tremendous interest in fixed income markets because people are looking for better guarantees. I think people have more feelings of uncertainty in the markets. Thats why you see a robust credit market. Remember, activity is not going through the roof. This is credit debt issue. Kelly . We are not seeing this rotation out of equities and into fixed income. Theres a lot of money sitting on the sidelines back to last year thats been trying to figure out where to come into the market. As we get closer and closer to the election date, investors are trying to find, whats the next secure safe haven there . Its out there somewhere. Thanks, appreciate it. A lot of food for thought. 45 minutes to go. S p is up five. Dow has a weakness in the airlines. Meanwhile, bank of america chairman, brian minor ham will speak with wilfred frost. Start ups are having on the banks profits. Up next, peace in our time or at least in the Republican Party, maybe. Likely gop president ial nominee, donald trump and paul ryan meeting in washington. We have the results of the much anticipated encounter. New hampshire governor and senator gives us his take on the courtship and whether the two republicans can find Common Ground, coming up. You are watching cnbc first in business worldwide. Man 1 i came as fast as i could. Whats up . Man 2 this isnt public yet. Man 1 what isnt . Man 2 weve been attacked. Man 1 the network . Man 2 shhhh. Man 1 when did this happen . Man 2 over the last six months. Man 1 how did we miss it . Man 2 we caught it, just not in time. Man 1 who . How . Man 2 not sure, probably offshore, foreign, pros. Man 1 what did they get . Man 2 what didnt they get. Man 1 i need to call mike. Man 2 dont use your phone. Its not just security, its defense. Bae systems. Welcome back. A little over 40 minutes left in the trading session. Monsanto is reporting that a bossable bid. A market value of 40 billion and it is up a smart 8 1 3 per cent on the reports. Kelly . Donald trump and House Speaker paul ryan holding a key meeting in washington to discuss Republican Party unity. John harwood has the lowdown. The republican nominee met with paul ryan and other republican leaders. We have just now heard as donald trump was preparing to fly back to new york from donald trump over how he thought the meeting went. He said it was great, things appear to be working out well. Paul ryan summarized the meeting himself before cameras at the house afterwards. I was very encouraged from what i heard from donald trump today. I do believe that we are now planting the seeds to get ourselves unified to bridge the gaps and differences. From here, we are going to go deeper into the policy areas to see where the Common Ground is and make sure we are operating off the same core principles. That was not an outright endorsement. His caution reflects a cup things, risks on both sides. If republicans reputeuate their nominee or a large number of them do, it hurts the entire ticket. On the other hand, if they get too close to donald trump given how polarizing he is with latinos and women, that means danger for republican members in swing states. There are seven republican senators, one running in states president obama won twice and also in swing districts in house of representatives. It makes it more challenging for the party to build Going Forward in 2020 when paul ryan, himself, might be a candidate. This process is going to go on. It looks like it is going to end with an endorsement. Paul ryan is going gingerly toward that goal. Thank you, john. Our john harwood. For more, the gop will fall in line, broadly speaking with donald trump. Lets bring in judd greg, the former ceo of the securities industry and Financial Market association. We could go on and on. Lottery winner. Yeah. Senator, good to see you. Have you been having an out of body experience watching the Campaign Season unfold this year . Oh, absolutely. I mean, this has been something that, the only thing predictable is its been unpredictable. No conventional wisdom applies to the race at all. You know, your cochair, we mentioned your multiple titles here. Cochairing an initiative known as fix the debt. Lets take a quick listen and remind ourselves of what trump told cnbc about the federal debt. What do we do with all the money we owe everybody when rates go up and now, all of a sudden, we have to borrow at two points more, three, four, five points more. Its a real dilemma and we have to be very, very careful. I am the king of debt. I love debt. I love playing with it. Of course, now you are talking ability, you know, you are talking about something that is very, very fragile and should be handled very, very carefully. So, that led to the column in the journal today saying gop aversion to debt is gone for now. What are your personal feelings about this issue . How important is it that this is first and foremost and do you trust donald trump with the presidency in that aspect . As you said, i had a group that started off after Alan Simpsons group, their spin off, basically. Its a bipartisan group. It is to do something about reducing the deficit and our debt. It is a huge issue for our nation. If you want to talk something disrupting, our debt is closing in on 100 of gdp. Its not sustainable. If we continue to move in this direction, we are going to pass on to our kids a nation that is less prosperous because they have to pay off so much debt. It has to be a number one issue in this campaign. Clearly, its not on the other side of the aisle. Bernie sanders massive spending and Hillary Clinton is moving in on him. Proposals for a Single Payer Health care plan. Its got to come from the republicans and the republican nominee that we will have a great discipline to debt. The strength of paul ryan is he is a leader on this issue and he plans to and has put forward ideas of how to get the deficit and debt under control. Ideas republicans can gather around. He is talking to donald trump about whether or not he takes seriously the ideas put together by the leadership and rank and file. Ryan said you cant unify the Republican Party in 45 minutes after their meeting was over. The debt is just one of many issues where paul ryan and donald trump disagree and other members of the gop. Immigration. We could go on and on and on. Yeah. Where is the middle ground . Who has to blink to unify the party right now . First off, our Political Parties are structured to be big tents where they crowd and the process of reaching consensus. We are the government by consensus. Thats the checks and balances of government. Paul ryans role, he understands and made clear, he is trying to be a buffer between donald trump and his rank and file members that have to run for reelection. Trump tends to go off on his own on some of these issues and is not in line with membership and has to figure out a way to adjust that so members can run on their issues and not be labeled as being with trump on the issues hes supportive of. Its a delicate dance. John harwood is right, the dance hasnt been finished. Today is not a bear hug, its a kiss your sister type of event. Theres a long way to go before we develop a scenario where paul ryan is comfortable putting his membership at risk saying they are 100 behind donald trump. Do you expect, at this point, senator, to support trump . He looks like the likely nominee. Hes going to be the nominee, theres no question about that. I think he is going to win, to be honest with you. Theres a lot of cynicism with that. The way the race is shaking up. I said i would vote for the nominee. I am in the paul ryan camp. I would like to see definitiveness on the issue of how to address the deficit and the debt. Im concerned with the erratic positions he takes, occasionally, the reverse of what he said the day before on big issues like the debt and deficit. The issue like how to deal with the debt. He earlier said he would consider doing it as a private sector individual. You cant do that. You cant threaten the payback of the debt. You just cant do that. If you do, you create a fiscal crisis and monetary crisis. Let me go crazy for a second here. Since this has been one crazy Campaign Season. Would you still, in the back of your mind, in your heart of hearts, hope that paul ryan would get the nomination in some crazy fashion after the convention . No, its not going to happen. Simply not going to happen. Donald trump is the nominee. Hillary clinton is the nominee of the democratic party. Both choices have serious concerns around them. But, as a practical matter, i like the fact that donald trump is still for a market economy. Hillary clinton is moving down the road for a socialist economy. I think that, in the end, is going to be the defining issue in the race. All right, judd thank you for joining us this afternoon. Thank you. 34 minutes left in the trading session. The dow up 33 points right now. It was negative much of the session earlier. We are hanging in positive territory. A lot to get ready for. Not true for the nasdaq. We talked about that. Ahead, we have earnings after the bell. Earnings fallout in the market today. Its not every day you hear the head of a major bank calling someone a jerk on live tv. The war of words between jaime dimon and the bankers of america. Jackie has a special report on that, coming up. The call just came in. Shes about to arrive. And with her, a flood of potential patients. A deluge of digital records. Xrays, mris. All on account. Of penelope. But with the help of at t, and a network that scales up and down ondemand, this hospital can be ready. Giving them the agility to be flexible reliable. Because no one knows like at t. Here at the Td Ameritrade they work all the time. Sup jj, working hard . Working 24 7 on mobile trader, rated 1 trading app on the app store. It lets you trade stocks, options, futures. Even advanced orders. And it offers more charts than a lot of other competitors do on desktop. You work so late. I guess you dont see your family very much . I see them all the time. Did you finish your derivatives pricing model, honey . Td ameritrade. Crazy story. War of words escalating between dimon and fine. Hes head of independent Community Bankers of america. Dimon was on squawk box yesterday and called for an end to violence. Hes creating a link with Community Banks to eliminate political heat on megabanks. I think the guy that wrote it is a jerk. Im stating a fact. We are one of the biggest Community Banks. Now, camden fine was on squawk box this morning and here was his response to being called a jerk. I guess we found out yesterday that if you have a policy disagreement with mr. Dimon, you are a jerk. I mean, thats his response . Really . I think he was channelling his inner mr. Potter, you know . Mr. Potter said something akin to that to George Bailey in the movie, its a wonderful life. Potter wanted to turn bedford falls into potterville. Jaime wants to turn america into jaimeville. This feels personal, right . The sense of the argument that jaime dimon is making, in the shareholder letter, his point in the case is when he looked up, you know, the bank that wrote this and whatnot, they were a client of j. P. Morgans. His point is, whave to stop the bank on Bank Violence or rift. Its not to say they have to be id logically and policy wise on the same page. Smaller banks often need the big bank to be their bank. If you are trying to create a Regulatory Environment where they are equally treated, you cant do that. Clearly, jaime dimon made it clear, he resents the tremendous regulatory mechanism thats been created over the megabanks in this country. There are plenty of banks. You dont want one person seen as speaking to you. Thats fine. Its healthy to understand theres a variety of perspectives. In this case, the point was trying to be made of all this was a client of ours is fundamentally the one calling out. We are going to hear from Brian Moynihan in a cnbc exclusive in the next hour of the show. You dont want to miss it. See if that comes up. The last half hour of trading, the dow up 31 points. A leading trader will tell us what he is watching. The earnings include nordstrom, dillards and shake shack, among others. Well bring those numbers as soon as they hit. Breaking down the analysis. Keep it here on closing bell. A good car has to maneuver quickly. Thats also true of a good car company. People have always bought cars. But we saw an opportunity in sharing cars. So we moved fast and launched car2go in 29 cities, all around the world. Doing that required dozens of data centers, designed for speed and performance. We built our business on the ibm cloud. Because thats what the ibm cloud is built for. We built our business on the ibm cloud. At ally bank, no branches equals great rates. Its a fact. Kind of like bill splitting equals nitpicking. But i only had a salad. It was a buffalo chicken salad. Salad. Whoa. Whats going on here . Oh hey allison. Im val, the orange money retirement squirrel from voya. Val from voya . Yeah, val from voya. Quick question, what are voya retirement squirrels doing in my house . Were putting away acorns. You know, to show the importance of saving for the future. So youre sort of like a Spokes Person . No, im more like a metaphor. Okay, a spokesmetaphor. No, im. Youre a spokesmetaphor. Yeah. Ok. See how voya can help you get organized at voya. Com. E. T. Phone home. When you find something you love, you can never get enough of it. Change the way you experience tv with xfinity x1. Welcome back. Dow is up 27. Nasdaq, though, continues to lag down 17 points. Check out shares of the msci brazil index as well as brazils bovespa. What a mess they have down there. The index was higher, but the senate voted to suspend the president and start an impeachment trial against her alleged budgetary violations. They call the move a coup and farce. She denies any crimes. The trial will proceed. Kelly . Thank you. Im on the floor with less than a half hour to go. Somebody earlier referred to emerging markets as the miracle that wasnt in the case of brazil, china and south africa. Certainly, they are differentiated now. How does this feed back into the u. S. Its about the dollar and janet yellin. Where does the dollar go from here. Today is a risk off day. If you look at the deals that have been kiboshed lately, the deals Going Forward are going to be speculative in the investors minds. How do you trade off it . We have seen lower highs, which makes people think that we are running out of steam. If we cannot make a new high, people are going to start to pull their money back. You see what apple has been doing. You are covering it s. They are saying no matter where the tenure is going they want to go in june. I felt they wanted to go in june and it was all but taken off the table. If they go, they have to go in june. Are we positioned for it . We werent in december. We fell off the cliff in december as well. You have to rip off the band aid and get to a normalized state. I dont know if we can get there, to your point. I do believe the market is trying to thread that needle. Janet yellin, in particular. Can she thread that needle, be hawkish enough . We have to wait and see. A tough job. Thank you, steve. Heading to close, 20 minutes left of the trading with the dow up 11 points. Bernie sanders has been campaigning on clean energy. It should come as no surprise, the city he was once mayor of, burlington, vermont, converted 100 of its energy use to renewable forces. It is a trend sweeping cities big and small. Well take you to one, next. Investors in retail are pinning hopes on nordstroms. You wonder if the seattle based Department Store adds to the whoas in the retail rampage. We have a preview coming up. Mixed market today with the dow higher. So is the s p. Nasdaq is lagging. Transports down 1. 25 . Avis budget group down 5 . Jetblue, american airlines, united, continental, each down 4 in trade. The oil hasnt stopped u. S. Cities converting to renewable sources. We have more out of San Francisco. They are working on being totally renewable. Hi, jackie. Reporter good afternoon to you. Where im standing is the Sunset Reservoir solar array. It is massive, built in 2010. Its the size of 11 football fields, 24,000 panels. Its smack in the center of San Francisco. You know, usually im doing the solar live shot in the desert. The solar panel is part of a larger project that San Francisco is working on. The city pledges to be 100 renewable and grass free by 2030. What does this mean, exactly . How do they do it . It refers to electric Power Generation and a combination of alternatives. That will fuel it. Hydropowered, wind and solar. The latter is where we will see the biggest amount of growth. By the time it is completed, this project is going to create 10,000 jobs, which is a massive amount of jobs to add to this area right now. The process is going to be whats considered cost neutral. Theres investment up front and subsidies down the line and the reduction users have balances it out. San francisco isnt the only city to try it, but the largest. East hampton, new york was trying to convert by 2020. Aspen, colorado, burlington, vermont, greensville, kansas. They have done it already. When you introduced me you talked about oil prices bouncing around in the 40 range. Its made alternative energy seem less attractive. We are going to see the cost of oil not impact the projects because they are going to continue. It doesnt matter what oil costs. We are looking to bring down the carbon footprint. Thats what this is about. Thats the difference between this and 20 years ago when people were paying lip service to alternative energy sources. They werent as Cost Effective as they are today. Now, they can defend their move in the face of Lower Energy Prices in oil and natural gas because it is Cost Effective enough to make sense on a scale like this, right . Reporter absolutely, bill. Whats happening here, when you talk to citizens in San Francisco, for example, that put solar panels on their roof, the costs come down dramatically. It costs more, but on a relative basis, they feel good about the impact they are having. Thats why they are willing to do it. The subsidies are going to be a part of it. You get everybody, not just the residents, but the municipalities and corporations on it. Thats when it becomes a community endeavor. Thats what San Francisco is trying to do. Be careful not to kill all the birds with the windmills. No one wants to see them on the water or the solar panels turn into laser beams and heat centers. Thank you, jackie. Reporter sure thing. 15 minutes to go until the close. The dow is up 26. S p is higher by a point and a half. Transports down 1. 5. Here we go, nordstrom, dillards and shake shack highlighting the after Hours Earnings tonight. Get a preview of what to expect. Tense up. When we come up. And id like to. Cut. Thank you, well call you. Evening, film noir, smoke, atmosphere. Bob. Youre a young farmhand and e trade is your cow. Milk it. E trade is all about seizing opportunity. Sign up at etrade. Com and get up to six hundred dollars. The light bulb, a bright idea if you use the right ones. Led bulbs use 85 less energy and last a long time, saving you up to 100 over their lifetime. Heres an idea replace yours today. [light instrumental music] replace yours today. E. T. Phone home. When you find something you love, you can never get enough of it. Change the way you experience tv with xfinity x1. Welcome back. Shopping and grabbing a bite to eat often go handinhand, or so we think. Nordstrom, dillards and shake shack are going to report results. Susan li is uptown at the nasdaq keeping an eye on shake shack. Courtney, what are you looking at . Investors are embracing for the worst. Itis hard to be hopeful after the retail results we have seen so far. Investors would like to see signs that nordstroms last crumby quarters were not a trend. If it is positive, it will be a novelty. Analysts are looking for nordstrom to report 45 cents a share, which is 45 below last year on revenues of 3. 282 billion. Hitting estimates isnt great with the low bar, but it would be better than we have seen so far if nordstrom can do it. Dillards announced yesterday, it would report today. They have 300 Department Stores so its lower. Expectations are a drop of 2. 3 . Dillards noted weakness in Energy Producing regions. Investors want to know if it changes now that oil is higher. Bill . Well check back. Well focus on retail. We dont want shake shack to get lost in the sauce, though. See what i did there . I got it. Very good, bill. Thank you. It wasnt too long we were trading 98 for shake shack. Lofty evaluations 83 times earn willi ings. Shake shack has a lot to justify at this point. We are expecting e. P. S. Up 20 . Revenues coming in at 52 million, an advance of 40 . The metrics they will focus on will be comp sales. Strong comp sales expected. This is a show me market for shake shack. They need to come up above the expectations. What about the expansion plans . They want to open 450 u. S. Locations. Outside of new york, where we are used to long lines at these shake shack establishments, going to suburbia and outside new york city, there arent those type of lineups. It will be interesting to see if they continue with the aggressive plans. Back to you guys. Shack sales is the shack sales. We have a million of them today. By the way, with ten minutes left, the market on clothes order to the bye, 350 million to buy as we head toward the close here. Joining us, hes been waiting patiently to spend time with us. Independent investment consultant, happy thursday to you, sir. Thank you. Bill, kelly, 48 of the American Association of individual investors weekly poll are currently neutral. As you know, the long term average is 30 neutral. Theres a lot of people sitting there on the sidelines that a little spark could cause them to go to the Positive Side or the negative side. First is, you have this g7 meeting in the summit in japan coming up on may 2627. That would be the s. That is the s. P profits with the second, third and fourth quarter. The comparisons will be easier. A is asian currency. The yen and chinese, if you can have stability for a while there, it will be viewed as positive. R is, you have the retail sales. You had bad numbers from retailers, midstream retailers. You need the consumer to start spending. I cant wait to hear what k is. Khalidalfalih policies. Eternal or endless. We hope that does not mean the oil supply. 9 or 10 Million Barrels of production. I have heard from knowledgeable sources, they intend to take it up to 13 Million Barrels a day, putting downward pressure on oil prices, which we hope comes back. Another r is real estate and investment trust. They have been on the tear. They are about to have their own subindex for the s p. They are going to be a separate sector. Money has been pouring in there from the index funds under weight because of a financial basket. Now they have to pull it apart and make it a real estate investment. If they are going to buy, they can for yield. Selectivity is the key. Im exhausted from talking. There are a lot of letters in there you fit in. We enjoy the spark. She has a column on cnbc. Com. I can think of another k to throw in there. That would be thank you, david. Kincaid school in houston, texas. David darst. This feels like a friday. We have the closing countdown coming up in a moment. After the bell, wilfred frost has an exclusive interview with bank of america chief, Brian Moynihan. 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All right, 2 30 left in the trading session. The closing countdown, the always dapper bob. Its springtime. It is today. Wait until tomorrow. Why, its going to snow . Rain. Colder over the weekend. Back to my parka. Speaking of which, its been chilly for technology and retail lately. Apple has been a drag on the dow, yet again today. The dow, itself, is up three points going into the close of trade. Low 90. Apple 2. 5 just today here. Broke below. That got a lot of play on the trading desk as it went to 89 and change. That battle between alphabet and apple on who has the higher market cap. Alphabet is leading by 2 billion. Lets go to the retail story today. Macys last night, calls this morning, both disappointing. Macys down another fraction today. It was down 17 yesterday. Kohls down 9 of earnings today. They did not change their guidance. They left everything the same which leads people to believe they will move from the downside. We hear from jc penny tomorrow. It is a turn around story. Still people are basically expecting the worst. We have heard nothing but bad news from the retailers. Everybody holding their breath for nordstrom and dillard Department Store. Shake shack is also on the list as we established with susan li. Dillards is down 3 right now. Nordstrom hanging in there, down just a fraction. Shake shack had a tough time recently. Thats been going down. They are trying to expand around the country. Will the country be as enamored with highend burgers as we are . We love shake shack. The airlines have had a tough day. Jetblue had negative numbers overall. Most of the airlines are down notably. Transport is down 114 points right now. 114. We are sitting at the lows today. Jetblue and united, delta. Speaking of airlines, alaska air is going into the s p 500. Sandisk is going away, bought by western digital. Good luck to sandisk for many years. A lot of volume to see. Thank you, bob. See you later. Johnson johnson celebrating National Nurses week and crain ringing the bell. Brian moynihan, the ceo of bank of america on the second hour of closing bell with kelly evans and company. See you tomorrow, kell. Thank you, bill. Welcome to the closing bell. Im kelly evans. Finishing with the dow going out positive. It was looking dicey, adding 12 points. Well keep an eye on it. Not the same for the s p 500. They are going to finish slightly lower, around 2064. Nasdaq, 23 more points to 4737. Investors are getting ready for the state of consumer spending. We have Courtney Reagan standing by and susan li watching for shake shack results. Dont miss an interview with bank of america ceo Brian Moynihan on the state of the Banking Industry. Thats coming up. Joining the panel, mike san tolely, welcome and cnbc contributor, stephanie. For more on todays market tim seymour joins us as well. We were talking a moment ago about what a weird market. A day, a year. What stands out to you about today . The continued dramatic rotation. Today, all these name brand stocks down, big. It seemed like a worst day at the lows with apple doing what its doing. The free fall with the retailers. Everybody thinking there was something going on economically. The credit markets were calm. Nobody expressing that much macro concern in terms of credit conditions. A continued churn. What led when we had money rotate. It was the yeld sectors, for the most part that took the floor. I totally agree with what mike said in terms of having a defensive feel to it. Yet, it felt worse because these retail, just another day of just getting crushed. For kohls to be down, again, that much, it speaks to the fact that so many people own these things. Macys, too. You would think a rebound there that didnt materialize. We have to get through jc penny tomorrow, reassess and get the value buyers in. They are saying upsetting things. Maybe amazons support now in earnings season. Forget the tech companies. The thing is, kohls said they had positive in february. Then march and april, things really fell off of a cliff. We heard that from maceys. What happened in mid march . Good question. I think not so great weather. That did contribute a little bit. You have this we dont know whats happening with the consumer. You have a shift, market share shift from amazon, online. The consumer is choosey. We have the savings rate number, up 5 . They are saving more, spending more or more selectively. I dont think that trend is going to change. Three things drive performance, the secular move, the cyclical piece. If they all work against you in march, thats the stock you get. A lollapalooza. Tim, what do you think . Consumer is spending on houses and autos. Home improvement, et cetera, but not in the four walls. Nordstrom is going to report, a lot of retailers and nordstrom in particular, not set up for promotional retailing. Some exposure to off price with rack. These are places where some of these guys, their Business Model challenged as mike said. You have the demographics meaning, i know about how millenial moms spend their money more than i have. Its amazon prime. Yes, yes. Its an interesting time. Ill show you my instagram feed from the past. I cant wait. Im going to piggy back whatever you are buying. It is traditional retailers spending enormous money on ecommerce. Maybe its other parts of their businesses in addition to amazon and competition. The macys ceo gave an interview talking about being more buy now wear now that successful retailers have. He talked ant the consumer puzzle. Clearly, they have been spending on things they need, automobiles, home improvements. We benefited from the furniture business. Health care is way up and people are going out to dinner more often. Again, this is becoming a specific story about retail, bricks and mortar, apparel. Not really the consumer more broadly. The clothing story, i think more directly. Its not just about we dont need as much. You dont care as much about going for specific brands. Thats been going on a long time. Lululemon got a shoutout on amazon. One of the places that could be insulated from the shift is a lululemon Victoria Secret type play because of the instore bra fitting experience. No benefit from that. I lie a lot of people scratch their heads. As gap stock goes down, it should be worth a bigger piece. How many pairs of black pants do we need . This at leisure thing is long in the tooth, in my opinion. At leisure bowl. I love it, i wear it all the time, but i dont need another pair, i have five. Our friend here had an athletta chash mere ash here on. Its extended to men, internationally. Its not over. I think its a tired theme within consumer discretionary. Lets look at shake shack shares. Results are coming out. We said how macys ceo thinks the consumer is going out to restaurants. Tim does that ring true. Others, like jack, are watching to see if they can overcome their struggles. To the extent people are looking at where the consumer can take advantage on gas and energy, the fast food places are benefiting most. In the case of some of the casual dining, i think theres fantastic stories out there. I think darden, places where theres a core Business Model, people trade down to fast casual in an upper demographic. It comes back to valuation. They got to a place where they were trading too expensive. Shake shack, which is coming out now is a valuation where you cant support the growth. Thats what the stocks are responding to. Stocks are up 10 . Lets go to nordstrom. Looks like a big miss. Courtney reagan has it. We have nordstroms result. It is a big miss. Reporting 26 cents. Analysts have been looking for 45 cents. Thats a really big miss there. 45 cents would have been down 32 . If you do the math, it is much worse. Revenue, 3. 25 billion. They were looking for 3. 282 billion. Comps down 1. 7 . Wall street hoped for the slightest of gains. That was missed as well. Nordstrom cutting the full year comp and earnings guidance. They are the basic numbers to get to you. Im going to take time to go through the press release with a fine tooth comb and bring you more. Thank you so much. Wow, stephanie. Big margin erosion. Maybe have matching price with a lot of their peers. We have heard that from kohls and macies. The competition was aggressive pricing. The slightly scary thing about the afterhours reaction is it shows todays action, which was bad before this wasnt that people said this is going to be as bad as they make it seem. It was worse. Something close to a fiveyear low for nordstrom stock. Tim . The one thing you take away, the highest quality store base, they have at least exposure to smaller malls, distressed malls people are talking ability. Yeah, what happens to margins when you cant discount and you have a slowing sales base. This is what they are facing. Stock down 40 coming into this move, as mike pointed out. This may be the capitulation. You get to free cash flow, Balance Sheet and valuation matter at some point. They can give Something Back to investors. This is going to yield something close to 4 . Very strong. This has been the trick. All of these big chain retailers have looked cheap, statistically. Kohls looked cheap before today. Thats the issue. A lot of cheap sectors, whether it was chain or apple, telling you its been cheap for two years, it goes down every day. Or the specialty stuff or airlines. Its been value city for a lot of it. Many hopes nordstrom would bump the trend. Maybe instead of going to maceys, im going to amazon. In that case, a customer that is more aspirational or wealthy and going into the stores. What does that tell us . The other interesting thing, not only to your point what you said about the customer base, they expanded their off price. Rack, they have 140 stores. This either shows that those stores are cannibalizing the Department Stores or that, you know, you are absolutely, positively not seeing traffic whatsoever. We have to hear what they say. Lets get more from susan li on shake shack. Earnings per share on an adjusted basis, eight cents a piece. Its above the five cents the market was expecting. Revenue, 54 million. The big metric has to be the sales. Comp sales at twice the rate that analysts forecast. Close to 10 , 9. 9 to be exact. Analysts were looking at 4 . Shake shack raising their guidance for earnings. 245 to 249 for revenue. Originally, they forecast sales increase. 2. 5 to 3 . They are raising it to 4 to 5 . Stock is popping at this point. Back to you. Susan, thank you. Shares 6. 5 . Was it is chicken thing . Are they raising prices . Whats going on . You doubled the expected comps. Clearly thats your answer. People arent buying boots at nordstrom, they are buying an extra burger. Who can blame them. They raised the comp range and revenue. This is still a very expensive stop. Its a story stop. Its one of these things people love the brand and bought the stock. It is performing okay. They are going to grow their store base by 20 this year. Its not just about the comps. Tim, a final word . A regional story. They are numbers, if you want them in this trend across 500 more stores, fine. When you are in new york markets and areas where people are overpaying for fast food, because thats whats going on. Overpaying for the stock is not something im going to do tomorrow. Im thinking overpaying for a burger versus discounting at nordstrom. Thanks, tim. Tim, well let you go, appreciate it. Theres more of tim an fast money at 5 00. Roger mcnamee about the real tech battle coming up next hour. Nordstrom shares are plunging after larger than expecting earnings. What the numbers mean for the future and the rest of the space. Dont miss an exclusive interview with Brian Moynihan on how regulations impact the Banking Industry to the president ial election. You are watching cnbc, first in business worldwide. By compromise, businesses need the agility to do one thing another. Only at t has the network, people, and partners to help companies be. Local global. Open secure. Because no one knows like at t. Welcome back. Nordstrom shares are under a ton of pressure after the weak earnings report. Lets get back to Courtney Reagan. We have a half hour or so before the Conference Call starts. Theres interesting notes. They operate their regular stores. They also operate their off price channel, Nordstrom Rack and they each have their website. The regular stores, those comparable sales were down 4. 3 . The off price channel, what we consider more outlet, those sales were up 4. 6 . I think thats a very interesting tell of whats going on with the consumer. You talk about how t. J. Max and those stores are doing well while nordstroms version of their off price channels are doing well. Not all apparel is hurting. Theres so many nuances within. Beauty was the number one category. Its important to millenials. They have to be selfie and social media ready. Its true. Its helping the beauty channels inside nordstrom and alta. Its interesting. The young womens apparel did well at nordstrom, too. Thank you so much. Lets bring in dorothy. What do you do with nordstrom now . With the stock down 23 year to date, more including whats happening now and more if we look back to the high last year, i think its been a tough retail environment. It got worse over the last week, certainly. This is a high quality name. They run a good business. I think they have tried to buck the trend throughout retail, which is to put everything at 40 , 50 off or more. I think, you know, they are doing it by trying to bring in fresh product, new brand and i think the young womens business is showing that some of the things they are doing on the apparel side, which doesnt seem to be working for anyone else is working for them. You guys agree . My question would be, are they able to make that work across the entire store . I mean thats the question. Theres an important point. Last year, if you look, the rack had a weaker quarter, relative to the full line stores and so theres, i think, we have to look at the twoyear comparisons, too. I did expect the rack to do better. I dont think its, you know, one is taking from the other, necessarily. The comparisons were different. We have to go. Is there any basis to swap out the stores, make them the off price ones . Look at sachs. They have been doing that. Thats the good thing. The positive. They did a nice comp in rack. Iz challenging Department Store and environment. Its great quality company. Probably, we are getting close, but im not sure what the catalyst is Going Forward. Thank you for joining us. Wilfred frost sat down with bank of america ceo Brian Moynihan to get his take on the Banking Industry. Wilfred joins us now with more. Yes, indeed. The environment for banks could not be tougher. Asset questions, ongoing regulation issues and low interest rates. I just sat down with the chairman and zoe of bank of america Brian Moynihan. I asked him if he was pleased to have that First Quarter behind him. We are please zzed to have i. We made money. The company made progress. We continued on the responsible growth. With each quarter, you feel good behind you because theres success. Last quarter, the markets made it interesting. In terms of 2016, you said on the call a couple months ago that march showed improvement col paired to the debts, the lows in january and february. Has that continued for april and may . What they are doing out there, its the strongest margin and continue to improve. If you think about investment banking, some of the deals arent getting done. It takes longer to restart the engi engine. Another high profile deal this week with the authorities of home depot and staples, do you think this inherent opposition from the Current Administration against them . I wouldnt i think these things oddly enough, if you read the papers, this deal was proposesed 20 years ago and didt go through. I trust other issues, a tougher bank Regulatory Environment. We have to learn how to make our way through that. What is interesting about what is going on, in all these industries, there s a definitin of market question, which gets interesting. Online sales and different way things get sold. Its a different environment. Global environments and different market definitions than they had before. Political changing, too. What would a Trump Presidency mean for banks . We need a president and a country focused on growing and investing to grow. We think a president and leader and congress and a Business Community and Regulatory Community to support growth and investment, infrastructure, tax reform so we get it right. Reasonable immigration policy. We need to bring all the talent in the world to get here, people like yourself. They can do great jobs here. I think the question is, as it comes together and the platforms get known, thats when people can make their choice. I certainly get that broad view in terms of the economy needs to grow. Banking sector in particular has been hit by all candidates. If we focus on the democratic side, would clinton not be better than Bernie Sanders for rhetoric . If you think about we dont get into the discussion of individual candidates and i dont think its right. If you think about what the regulatory across the world has tried to ensure of the last eight, nine years is simple set of equations. More capital. Get the capital levels right. Get the resolvability right. Largely that is done in both parties, whether you agree its too much or too little. Agree that a lot of that work is done. We have to agree it works. Thats the challenge ahead. What i would like to see is constant focus on getting these things more correct at the margin. Theres elements put together quickly and we have to make them work. We have things coming up and living wills. Are you confident you will pass boast . In a case and resolution, you can see what we see. We got task to work. We spent a billion dollars internally and externally. Its in our best interest to make it work. We have the plan in place to make it work. Whats important with that is not only that it works for our company, but all the participants it works for. At the end of the day, we stand for each other in a broad prospect because of the fdic. Its got to work. With the large banks we have to liquidate them. We think well get that done. Well pass them both. The question is, its just work. Is it possible to hit that 10 target without a rate hike . Its harder. As the parallel rate for us 6 billion last quarter. Its harder, but can be done. We have managed about, in the First Quarter, we had some accounting adjustments, if you take them out, we are 8. 5 . The path to make it up to ten is in front of us. Rates push it above that. So, we have a path to get to acceptable capital without rate rise. It takes a lot of work. Give you a sense, since the beginning, the last five years, we are down about 80,000 people. Thats the entire employment base. I looked that up the other day. Thats the amount of change going on in our company. We have to keep doing that to bring the cost structure down and we are working on that. They get a lot of focus in absolute or relative terms, versus your revenue. Banks of similar size, it doesnt come out top. Do you have to get that down low, particularly if we dont see a rate hike . Absolutely. We have done it every quarter for 20 odd quarters in a row. This is not in the news. If you think about it, we are going about fairly stated, 66 67 ratio. We should get it down to 60. We have to get it down closer to that and that will put us above the 10 . The reality of that is, it is hard work to keep reengineering the company. On the other side, we are making massive investments. 3 billion a year in technology. More sales this year and last year in all businesses. We keep adding people, more sales, more service. At the same time, you are taking it out. That trade off is trickier than when we had 70 or 80 billion of costs in a year. The first triage was quick. Now its grinding it out quarter by quarter. Pressure from shareholders and the Investment Community on the revenue ratio. When you see big Financial Institutions like aig, this week, mr. Paulson added on. Do you have a fear you could be next . We continue to execute our strategy. We got through the annual meeting. Directors elected 9498 . This is a large company, we continue to make progress. We have a little more to go to get the threshold level. Well get that done over the next couple quarters. More relaxed for you this year compared to last year. Lets move on to the issue in North Carolina most recently hitting the news. I spoke to the governor. I know you have come out against the bathroom law recently. If it didnt get repealed, would you consider moving head count away from charlotte . Look, we have been clear this ought to be repealed. The reason is we have 200 million teammates and 50 million customers. We run the company for it to be the greatest place for people to work. Our own employees are worried a law like this will impact them. Not affect them personally, who they are and what they do. It affects their teammates. We will continue to monitor the situation. It is now in litigation, which will take a while, probably. Our view is it ought to be pulled back. It represents something against the value of our company. Should the governor have looked at it more widely before signing it into law . You had him on yesterday. He can speak for himself. The answer is, it ought to be repealed. Three Head Quarters you have in boston, new york and charlotte. Does that hinder your ability to cut costs . Would you consider making it two or one . We have one headquarters. Lots of head count across three cities. If you add those three places up, we would be 35,000 head count in the state of new york and the state of North Carolina and the state of massachusetts. We have 212,000. Theres people everywhere. We have 750 people in tokyo. The question is how to bring it down. To give you a sense, we are a tenant in our building in boston. We shrunk down. We have taken, i think 6 million to 8 million square feet out of new york city alone. 40 million square feet of the company in seven years. And you still have space to sit here. We are charging you for it. Massive factor, has it spread to be a factor in q2 and spread from the Energy Sector . We have seen nothing. The activity in our commercial portfolio is still strong. The activity from the credit is still strong. The oil and gas, frankly is mitigated because of the obvious issue of price change and working through things. The call in our company is very, very strong. It continues to remain so. A final question for you, brian. On the february 11th, jaime dimon, famously in our circle, bought into his own stock. Are you happy with your, currently, just over 1. 1 million shares . I get paid 100 in stock other than my base salary. Do you dip in yourself . I have in the past. It was all awarded in stock. I dont sell stock. I have it. Im happy with my ownership position and will continue to increase it. I do every year, because its all stock. So, there we had Brian Moynihan happy with the shares he holds. Shares close at 14. 14. They are up since the february lows we mentioned. But still down 14 yeartodate. The next big item on the agenda for bank of america are the results due in june. On that note, back to you. Especially if they are charging you by the minute. Great interview, wilfred frost. 80,000 people is the number of employees they have shed from the peak. The take away is it is a s g slog. Theres no fast track or magic. We grind it out and try to do things on a margin to earn a profitable return. Do you think every dollar on compliance and the framework he mentioned in the next piece of it, is that taking away from the ability to do loans . Is it not that easy . Well, i think these companies have actually started to see light at the end of the tunnel in terms of all the legal costs. Last quarter, many of the companies, the big banks saw declines in those expense levels. These guys are different. They have a lot of extra overhead that they can cut. So they have been doing a really good job at that and making progress. I think theres more to go. Thats kind of the case for bank of america. They have more cost cuts. They have more to come. Thats why you can see maybe better normali izized earnings. Its a slog. It was not a help. Its rationalized then you have a quarter like last quarter, the Merrill Lynch division. They have to cut. When he was asked, is there more cost cutting to come, oh, absolutely. No hesitation there. Brian moynihan speaking with wilfred frost. Broadening wages may have a damaging impact on employers. Well talk about that coming up. The results of the Cnbc Millionaire survey, election edition. Which candidate the millionaires are selecting. Thats more on closing bell. Whats going on here . Im val, the orange money retirement squirrel from voya. Were putting away acorns. You know, to show the importance of saving for the future. So youre sort of like a Spokes Person . More of a spokes metaphor. Get organized at voya. Com. This cit added this other level of clean to it. It just kinda like wiped everything clean. My teeth are glowing. They are so white. I actually really like the two steps. Everytime i use this together it felt like leaving the dentists office. Crest hd, 6x cleaning, 6x whitening. I would switch to crest hd over what i was using before. Welcome back. We have the earnings from dillards out now. Courtney reagan has the report. Dillards are reporting 2. 17 per share. That is actually a wide miss. The analysts that report numbers, the con sentence was 2. 52. Revenue in line, shy at 1. 54 billion. Analysts looking for 1. 56 billion. The same store sales, its the key metric we focus on, down 5 . Thats twice as bad as what analysts had been looking for for dillards. They did say shoe sales were strong, easy for me to say. Home furniture and ladies accessories were weak, selling points for the quarter. This time, no mention of weakness in the south and Energy Producing regions. Not to say it was strong, but not a weak point. Dillards does not hold a press Conference Call. Back to you. Thank you, courtney. They are closely held. They are very closely held. Still the family is involved. Courtney mentioned, they didnt mention the energy heavy regions in the 80s energy bust, this was a Collateral Damage company. Its a subscale player. The region should be better than the country because the south is growing. 5 drop. Trading eight, nine earnings. Time for a cnbc news update with sue. Here is whats happening this hour. Tens of thousands of protesters marched throughout the streets of paris to denounce a hotly contested labor reform bill the french government is trying to force through government. The Prime Minister survived a no confidence vote over the labor law. Online auction for the gun George Zimmerman used to kill Trayvon Martin was pulled this morning. It was scheduled to begin 11 00 a. M. Eastern time. Three minutes later, the auction was unavailable. Later in the afternoon, unitedgungroup. Com. The bidding began at 5,000. Hasters lead Attorney Says he will not appeal his conviction in a hush money case centered on sex abuse of students when he was a High School Wrestling coach decades ago. Mcdonalds is testing quarter pounders made of fresh beef in 14 locations in dallas. They would do that rather than frozen beef. Its too early to tell if it could be expanded. I guess if you are going to do beef, texas is the place to test it out. Thats the cnbc news update at this hour. Its on quarter pounders and everything is bigger in texas. Im still scarred by the hamburger story yesterday, sue. Thank you. Moving right along. Exactly. Wages are rising, profits are falling. Why that could lead to a Tipping Point for businesses. Later, why games are becoming a trendy way for wall street firms to identify top job candidates. We are back in a moment. What are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you need in one place and lets you visualize that information for any options series. Okay, cool. Hang on a second. You can even see the anticipated range of a stock expecting earnings. Impressive. Whats up, tim. Td ameritrade. Welcome back. Here is a look, first of all, of how we finished. The dow up nine points, s p down by a hair and the nasdaq down 23. Now, lets get to the names, big movers after hours on earnings. Nordstrom, first and foremost, down 17 . Nearly eight bucks there after its miss. A lot of questions about sales, trends and margins. Shake shack up 5 . Dillards down 4. 6 . The minimum wage debate continues throughout the country. Cities and states establishing hourly increases. Workers are reaping the benefits, but employers are feeling the pinch. Welcome back. Thank you. So, who is hardest hit by this as we can tell . So, any company that has a lot of workers, and in that low pay area. Its not difficult, hotels, restaurants, businesses, airlines, businesses with a lot of employees. Industrial companies. The problem is, the labor market got very tight in the last year. Its now starting to play out. In a way, it sounded like wages would be going up anyway. This is feeding into it . Yeah, no, i think thats right. The minimum wage increases are coming at a time when the market has to take them. People are quitting their jobs at a very high rate now, confident they can get another job. They are taking longer and longer to fill jobs. Obviously, a great run, 8 million jobs in the last years. Its stunning. Its all coming together for these companies. The problem is, business is not that great. As we have been reiterating. You know, its interesting. In some respects, its catch up. You have these very elevated Profit Margins so long. The first three or four years of the recovery, the average worker is not sharing in it. The then it started swinging the other way. Its interesting. Sometimes in history, wages go up. More people have jobs, they spend more and the economy does well. Retailers and restaurants do well. Now we are seeing people are not spending that much more. They are not borrowing. Partially because they are holding money, you know, they are saving more. Thats hurting. We have been seeing these earnings. Its very interesting, this dynamic. People are worried. They just got through a rough time. They have a good job. They are getting a raise. Im going to save this money for a while. Theres two ways it can go. People get more money in their pockets and the old henry ford line, they are able to spend more. Itss a virtuous cycling. If the businesses are getting hit, then the opposite outcome could happen. They might have to cut back on other things that could hurt the economy. Sure. Clear the consumer is saving on top of it all. How much do they save . How long does it continue for . Its the biggest question. Its a healthy thing. We want people to save. At the same time, they are getting crimped. What are they going to do . Going to have to eat it. Profit mor margins are high, thats obvious. They come down. I think they are going to wait. Theres a hope that people will start to spend, right . You dont want to cut. But, its going to play out over time. We are going to see over the next six months, are consumers going to spend more . We saw gas prices come down. Consumers get a dividend. They spend it on restaurants and leisure activities than retail. That may be the thing. Maybe we have had a change and people do their Retail Shopping online. They go out to dinner or take a trip. Maybe we are going to see a big shift. We dont know. There has been an upheaval in the economy. Its another reason to watch the report on tuesday. Well see if they can elaborate more for us. Thank you. Thank you. Read more on the wall street journal. May the odds be ever in your favor when it comes to a job hunt. It may not be the hunger games but its a top priority. They are asking candidates to participate in games as part of their assessment. Thats after this. 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. [ male announcer ] if youre eligible for medicare, you may know it only covers about 80 of your part b medical expenses. The rest is up to you. Call now and find out about an aarp Medicare Supplement insurance plan, insured by unitedhealthcare insurance company. Like all standardized Medicare Supplement insurance plans, it helps pick up some of what medicare doesnt pay. And could save you in outofpocket medical costs. To me, relationships matter. Ive been with my doctor for 12 years. Now i know ill be able to stick with him. 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I have a lifetime of experience. So i know how important that is. Welcome back. Play a game and win a job. As recruiting top talent becomes competitive, they are taking an unorthodox approach. Kayla has more on it. If you are a mobile gamer, you are in luck. Thousands of companies are using video games to screen candidates for things like interpersonal and analytical skills. A company partnered with more than 200 Blue Chip Companies and its catching on for two reasons. One, it helps companies cast a wider net in recruiting new candidates and two, it provides a better way to compare cants to each other, rather than a subjective resume reed. Theres stock views. Its basically Fantasy Sports for the markets. You buy, sell, short stocks, manage risk, margin and the downside. Morgan stanley and barclays are using it. Barclays found 20 hires through it and 1,000 universities are use zing it to screen candidates for financial careers. Cofounder deutsche trader hopes it makes finance careers more successful. The diversity of the candidate pool. If you studied physics or english, you can showcase your skills. Thats what we want to break it down to, the core skills to be successful. If you are a great trader, thats not the most important aspect. Its not that i was ignoring him. I was so engrossed in the game i was playing. Im not sure i would have made the cut based on my score, which is 84. Im told it was pretty good. I wouldnt be automatically cut from the candidate pool. Guys, its a brave new world of recruiting. What is the game like, kayla . Is it a video game or a quiz . Basically, there is an open contest. Some of them are led by universities, some led by companies where they set certain parameters. Everything gets 100,000 of fake money to manage. You manage your own portfolio. There are rules, when you can sell, how much of a certain stock, how much the market cap is. Mccomerica parkic was telling us where they go wrong is they dont abide by the rules. They try and buy small caps and maybe the rules say you cant and the company says wait a second, if he didnt read the fine print, maybe thats not a candidate we want. Thats an interesting thing. Stephanie, sounds like your day job. Totally sounds like my day job, i was about to say. Do you think this is a way you would want to screen the people youre working with or other factors . I think its creative. Hard to get a read on people when you interview people. My first interview, in fact, my boss, he actually asked me about running and i thought, wait a second, were not talking about the market, stock picks, but what he was trying to do is get more out of me, my personality and drive and that sort of thing, so i totally think this is a wonderful idea. I think these companies in finance would want to use this to find customers. Lets see who is an addicted trad trader, somebody that cant put it down. Thank you. That score sounds excellent to me. We dont want to lose her. Kayla tausche. Be sure to tune into power lunch tomorrow. The 3 m ceo will discuss. [crowd cheering] i could get used to this. Now you can. When you lease the 2016 es 350 for 329 a month for 36 months. See your lexus dealer. singing you wouldnt haul a load without checking your clearance. So why would you invest without checking brokercheck . Check your broker with brokercheck. Flip your way through your last 9 shows with the tap of a button. Change the way you experience tv. Xfinity x1. Welcome back. Im supported to give away the answer here, robert, but i dont want to. Hes here with the results of the millionaire survey and i want to know who they picked as their favorite candidate. I appreciate not giving the spoiler there. Hillary clinton has a double digit lead but trump is quickly extending his reach up the wealth ladder. 44 of millionaires plan to vote for hillary in the fall compared with 31 for trump, according to the cnbc survey. Now six months ago, trump had 9 of millionaire support, but here is the big kicker, 15 of millionaire voters are still undecided for november. When it comes to investing, 42 of those millionaires said Hillary Clintons election would be a Good Opportunity for investments. 36 , so pretty close there neck and neck said trump would be a Good Opportunity for investments but billionaires are defined by Political Party than wealth. Democratic millionaires are largely bullish this year but look at republicans, they say both markets and the economy will be weaker. Most important issues in the election for millionaires being Foreign Policy followed by political gridlock and taxes. 1 in 5 millionaires had given to a candidate this year or plan to and 1 in 5 plans to or either has given to a super pac. Not like these candidates are publicly cording votes for millionaires but they dont want their money so these numbers will matter as trump ramps up his fundraising here going into november. So 9 to 31 support for trump there, robert. Thats a big move. Yeah, yeah, in just six months. Thank you. Robert frank. Consumers are spending money on burgers instead of clothes. The latest from nordstrom and from shake shack, too. When we come back. All across the state, the economy is growing, with creative new business incentives, the lowest taxes in decades, and new infrastructure for a new generation attracting the talent and companies of tomorrow. Like in rochester, with worldclass botox. And in buffalo, where medicine meets the future. Let us help grow your companys tomorrow today at business. Ny. Gov because my teeth are yellow. These photos . Why dont you use a whitening toothpaste . Im afra its bad for my teeth. Try crest 3d white. Crest 3d White Diamond strong toothpaste and rinse. Gently whiten. And fortify weak spots. Use together for 2 times stronger enamel. Crest 3d white. Mobility is very important to me. Thats why i use e trade mobile. Its on all my mobile devices, so it suits my mobile lifestyle. And it keeps my investments fully mobile. Even when im on the move. Sign up at etrade. Com and get up to six hundred dollars. Welcome back. Checking on shares of nordstrom and dillards are plunging on earnings misses. Shake shack, maybe that is the trend. Weve joked its the restaurants experience. Without a doubt. Thats where the dollars are going. If you look at the spending data, the visa transactions and these things that collect the overall activity doesnt seem like there is a big fall off. People are spending so if it on those look, if you eat enough burgers, you probably need bigger clothes at some point. Youll need exercise equipment, too. Lululemon. One of the best stocks from the lows is mcdonalds. That stock continues to go up every single day. Not cheap but clearly the trends are there across the board in yum and many Restaurant Companies and i think thats probably going to be the trend as well as this destination kind of thought process, theme, the carnival cruews and that thing. Well get the sales data which isnt about retailers and shopping but it might act as a check in the overall picture. Part of the issue in the report and sales figures is the deflation issue. So part of the reason why we see the dollar shrink is just because of the discounting going on. It makes it tricky to know how much is it a drop in volumes and price and do they feed tonight . Think about auto. Im going to be interested to see that data point because we know very mixed data points in that sector. Exactly. Auto, deputy stores and get basically amazon that sector. If that doesnt show growth, we know there is problems with this, too. Well look forward to that. Stephanie link, mike, thank you. That does it for us on closing bell. Fast money beginning right now. Fast money starts right now live from the Nasdaq Market overlooking times square, karen finerman, dan nathan and guy. Roger mcnamee says there is a technology to own that will eat google and apples lunches. Plus, look at nordstrom. The latest retailer to tank on earnings. Ubs says it doesnt matter which one of these two people becomes president , the market no matter what is going to see a major shakeup. The strategist behind the call is here to explain. Two mega cap tech giants but not apple or google. We are focused on facebook and amazon. Check this out. Both