Transcripts For CNBC Closing Bell 20161004

Englishman in the house to discuss it. Google unveiling a new smartphone called the pixel. A number of other hardware products. We got someone who says todays announcement shows google is finally ready to take on apple. Hell explain why. Who comes up with those names . Pixel. Reminds me of the movie. Pictures from facebook, guns, sex, drugs, and facebook. Is that what you do at night we told you yesterday about facebook is this what its going to be like for two hours. Facebooks new marketplace was launched yesterday to take on the likes of ebay and craigslist. People are already selling some illicit items on the facebook site. Well tell you how the social network is responding today as we show you more and more of these photos here. And for the first time medical device maker is warning consumers about a cyber bug in one of its products. Johnson johnson said one of its insulin pumps is vulnerable to hacking. We got details. And the guy able to hack the device. This is no longer just an episode of homeland. This is really. Absolutely fascinating. I had no idea an insulin pump could be hacked. Wait until you find out why he hacked it. Thats coming up. Lets begin with googles big hardware reveal. Josh lipton is outside of the google event in San Francisco with some of the details for us. Hey, josh. Reporter well, bill google ceo clearly getting very serious about hardware. That was one takeaway from this event. The star of the show was the new smartphone. Its called a pixel. I just spoke to googles head of hardware in terms of what he thinks makes this phone different. It comes ready and able with Google Assistant, the companys digital assistant, answer to apples siri. Making the case moving from a mobile first to a. I. First world. He think google has the advantage given all the data google does have about us after the months and years weve been using google search. The price is 649. Now that is tricky because that premium part of the Smartphone Market is under pressure. Google clearly believes it has the product to bring to market right now. Another way the smartphone is different than the competition it comes day dream ready. Remember google day dream is that vr platform. Googles bet is that future vr is mobile vr. It doesnt think future is pc enabled or console enabled. It wants to make one more accessible, more affordable. Said it will sell that for 9. More details about google home. Remember thats googles answer to amazon echo. Amazon has first mover advantage. Google clearly believes it has a competitive product. Certainly competitive on price. Google saying today google home will sell for 129. Amazon echo retails for 180. For investors what does this mean for some of googles partner. Google telling you they will start getting into the premium smartphone base, into the vr head phone space. What does that mean for partners like samsung. Seems an already complicated relationship that much more complicated. All good questions. Joining us for more is bob peck from suntrust. He has a buy rating. Also with us is lance. Lance, ill start with you. I carry an iphone. When i get a new iphone i download google maps and google search. Seems like they would like to get the hardware in on the business because thats where they could make money. They tried it before. Will they be successful this time around theyve never done anything quite like this. They never developed, designed and mafrd the hardware. Theyve always tried to influence their partners, teen first google phone was built by htc. There was no secret about it. Nobody is talking about a partner building this thing. Google wanted control because they never got things exactly right. Fact that its only coming out, the pixel is only coming out on verizon is telling. I tell you when you get the pixel phone it wont have any of that verizon bloat wear. Going back to the days of apple they had to squeeze at t this is the way youll make our phone. This is an apple play from google. Bob, what do you think of all this . Given the track record that google has had with hardware and i think of the google glass that lance wore a couple of years ago and brought on the set here. But, anyway, what do you make of todays introductions . As far as the financials it has no impact. Talk being over 80 billion of revenue and hardware is around a billion or so, billion and a half. However why are they doing this . We think theres two reasons. One is the point of control. You go back to the pc era, pc creators, they controlled who got preinstalled. Who was the default search engines, et cetera. As we went mobile, apple, samsung, the others controlled those points of control. We think google want as seat at that table not to be marginalized or at least participate. The other part two is data. They can use the data for a. I. , omni device available they can use that data to fine tune you better for better higher advertising targeting and roi, drives their core business. Those are the main reasons. I get all the why, bob but the Earnings Report comes out every quarter. We talk about the selfdriving car and spaghetti they are throwing against the wall. Then you see the numbers, oh, yeah google search. They make money from search. Is this enough to change the revenue stream for them and does it make it more of a buy, less of a buy . We dont think its hugely incremental. As i mentioned 1 or so impact so far. However where they can monetize it, improving of the roi and more and more ad dollars they can get because of that. I just want to say if you think about in the whole presentation google made one mistake they mentioned a. I. And Machine Learning up front which consumers their eyes closed they dont care. What they are focusing on and whats important about this is Google Assistant. Notice how they talk so much about google search. They talk about Google Assistant ties it all together which is backed by google search, Machine Learning, a. I. And this is a consistent thread that will go across pixel phone, mobile phone and every hardware product that google brings to the forefront from this point forward will be about Google Assistant. Understood. So much is made of the apple eco system, right . What they are trying to do here, i guess you mentioned all the apps and software that you download from google but now the hardware is trying to complete that eco system. Lance, do you think that people will want to buy the hardware just because they use the software and the apps that google makes . Its a tremendous risk. I just dont know. In toward get information buy this hardware they have to see something truly compelling. The pixel phone is good looking device. In addition to the Google Services they put something extra. Free storage for your photos and video at full resolution. That actually is very important to people. But it is such a big question mark. Theres so much competition. I dont know if google can beat apple. Where do you think the stock goes . We like it. Its a buy 99 target. For us much more pretty indicated on the core and how thats performing. Our checks with advertisers show very strong fundamentals here. Improving rois, this to us would be incremental to that. Would you sell april signal we dont cover apple. There you are. Bob peck, lance, good to see you both. Appreciate it. Lets get to your closing bell machines. Dow down 120 pointing right now. Steve, art used the word trap door to describe this sell off weve had. Whats going on . If you look at the market you and i discussed this on the floor yesterday. Right around roughly this time. We had on friday we had quarter month end. Whats the real catalyst to get in or out of this market right n now . I dont see much. I do see people letting it go sideways. Opec is basically the new fed. Everyone is keying in on that. I think people are leaving rates until the november discussion. But if you look at the market as a whole, Industrial Production, retail sales, ism numbers, these are things that people want to hold and bite into as far as fundamental reasons why the market can go higher. We had a better ism number. Next week we get retail sales. Thats what originally caused a lot of the selloff. Rick santelli, i was speaking to mike santoli, no relation of yours. We talked about the quick rise in Interest Rates, the two year yield to its recent top of the range, the ten year yield last i saw was once again threatening. Is part of todays selloff because were sealing horizon on Interest Rates despite what the fed will do. Yes. Yes. You win the kewpie doll. I dont think the rate rise has anything much to do with the fundamentals of economics. Steve is right. We had better data before the most. Lets all be frank here. If i had to draw a line over the last ten quarters that described the data it would be pretty darn flat. Yes it has some bumps. But well average about 2 or less even if we get spectacular third and Fourth Quarter gdp so the answer is yes. I know we shouldnt talk about the next thing but has there been any compass needle fluctuation and mario draghi and the ecb and quantitative easing and the notion about buying corporates i cant tell you there is. I dont have a good source that can whisper in my ear there is. It seems though. Many of my compadres talk about that. When you look at ten year note yields we see that we have left in the wake really for august and part of september huge amounts of heavy concentrated tightly packed price activity and Interest Rates. Mostly below where we are. As we move away from these prices think about all those positions that are in that consolidation and what their next move is. Ive been saying for days im not looking for a big rate increase and i dont think its a positive necessarily. How much pressure does Deutsche Bank bring on mario draghi and the ecb right now . How much is that affecting what were seeing in rates . You know, i think that Deutsche Bank is a Perfect Institution to reflect the knuckle headness of the policies that are being implemented to fix something because i guarantee you Mario Draghis negative rates is negative lending rate none of this is going to make Deutsche Bank better. I assume they get over the recent mogul. There might be something to that smoke which is leading to the conversation traders are having. Before we go mike, we talked about this yesterday seeming migration on wall street away from the defensive issues more towards cyclical and indeed today the rates are going up. Do you sense the market is getting itself ready for a time when the economy will start to go a little faster . Maybe . Sort of. Youre seeing some uncertainty and some volatility as weve gotten through the end of the quarter. People are still looking at the elections. They are listening to the Central Banks. They got one eye on Deutsche Bank. India eased for the first time out of that central bank with the new central bankers there. Were seeing additional quantitative easing or lowering of Monetary Policy around the world. Yeah, youre seeing a shift out of those yield stocks that have done well, the riits and telecoms. Its the Consumer Staples as well. Look for companies that havent done as well with good solid balance sheets. They will be the places to invest and live as you get to year end. We got to go. Thank you all for your thoughts on todays market. Appreciate it. We got 46 minutes left in the trading session. Here you saw the dow was down 130ish. Were getting close to that right now. Heading to the lows of the session once again. Coming up next drugs, guns, hedge hogs all on the set. Just a few of the illicit items that made their way on to facebooks new marketplace site. The company is issuing m memea mea culpas. Dont miss our Vice President ial debate before the debate. Well discuss what tim kaine and mike pence need to accomplish to sway voters their way in whats still a very close race. Youre watching cnbc, first in business worldwide. Unlesesyoure a barista. Cdw implemented Dell Poweredge servers withntel xeon unlespres to allowrista. People to work from ywhere, soucky me. So nobody wants coffee . hey,an i get a couple coes . Hanced mility by dell. I. T. Orchestration by cdw. 43 minutes left in the trading session with the dow down 120 points. Couple of other movers. Dr. Pepper snapple lower after that stock was downgraded from told buy. Dr. Peppers potential sale of buy brands and loves distribution could affect earnings per share between 20 and 25 cents and that stock today down more than 4 . Dollar tree is in the red as well with Cleveland Research downgrading it from neutral to buy. Facebooks move into ebays territory not going so well. Its new Marketplace Service launched yesterday and people started selling illicit goods such as drugs, guns, animals. Reporter facebook apologizing for the illicit items said a technical problem prevented them from looking. They said were working to fix the problem and will be closely monitoring our systems to ensure we are properly identifying and removing violations before giving more people access to marketplace. Facebook saying 450 Million People already visit, buy and sell groups on facebook every month. Now if this tool takes off facebook poses big competition to ebay and etsy and consideration late. Theyve drawn criticism they dont have a secure Payment System or star ratings. And it doesnt facilitate delivery which could lead to in person meetings with unvetted sellers. We were talking earlier today about some of the missteps that facebook seems to have made this year. The trending issue and various other things that have happened that theyve had to take back or do quick course corrections. Are they trying to do too much right now . Reporter its interesting. I asked that very question to one of the analysts who covers facebook earlier today. He said in a way its inevitable when youre a company this big and you try things this big there are missteps. Facebooks strategy on these things is very different from apples. Apple doesnt launch things until they are totally done and perfected. Facebooks strategy has been to get things out there teen iterate and fix them once they are already in beta testing or rolled out to the public. I dont think its that unusual for facebook with that strategy to get things out there and have to make tweaks later. I think about the biggest hurdle they face the whole issue can they monetize mobile and there was so much data and they managed to do that. Big time. Reporter that was the big question from several years ago. They proved facebook can be a mobile first company. The vast majority of its revenues from mobile. They dont need to generate a ton of revenue. But they should be looking at these different ways to make sure people can stay within the facebook eco system instead of having to go outside to ebay, et cetera to do different things. Be inning to see how it pans out. Thanks very much. Polls show a majority of voters find both president ial candidates pretty unlikable. Thats news . Hillary clintons unfavorable rating is 56 , donald trump at 61 . When the Vice President ial candidate meet tonight to debate the issues can they make either ticket seem nicer . Joining us now ricketyler a political analyst for msnbc and cruz for President National spokesperson and Jimmy Williams is the host of decode d. C. And former senior economic adviser to dick durbin. Good to see you both. Thanks for joining us today. Rick, nobody has ever changed their mind or voted based on what they heard from the Vice President ial candidates. Whats the point of tonights debate . Whats the goal for both sides here . I think its kind of tradition. Look the goal here is really not to make news. Donald trump has lost momentum. Hillary clinton has some momentum. So with catim kaine he has an easier path. He wants pence to own trumps missteps and by contrast pence wants tim kaine to disagree with hillary or take responsibility for some of her ethical missteps. But i dont think there will be anybody swinging from the fences. They will be going for base hits and doubles. Y my, i assume you will watch the Vice President ial debate. You want to see if these people are ready to assume the presidency. In this election some people hope that maybe they assume the presidency or on the ticket at the top instead of where they are at this point. What can either one of them do to convince the public that they are the right attorney step in if needed . What is the great slogan, keep calm and stay cool. I think rick is exactly right they cant screw it up and just have to be come across as thoughtful, as smart, as president ial. And you cant say crazy stuff thats going alienate suburban voters, women voters and i think thats where they are going to have to do somewhat of a little bit of a jumping trick. Both of them will have to do this. Most people dont have a clue who either of these two men are outside of their home states except for indiana and virginians. I dont think that Hillary Clinton will win indiana and i do think that shes going to win virginia. So whats the big deal . The big deal here i think the moderators have to figure out a way to draw them outside of their comfort zones by actually making their policies disagree with the president ial candidates policies. That will be the real clincher. Jimmy i guess that means you wouldnt see them attacking each other the way trump and Hillary Clinton might do . Honestly i think pence will not go on the attack mode. I can see tim kaine doing that. He needs to be a bit more forceful. Both will play it safe. If i were advising them i would say play it safe and be presentable. Rick, whats going on behind you. Is there a protest . Im in front of this is longwood. People are Getting National attention both on msnbc and nbc and all the other networks and they are having a ball here. They are loving they are showing off their school. You played donald trump in the mock debates with ted cruz, correct not as good as alec baldwin. I was just going to ask. Did you see that . It was remarkable. He really just nailed it. Yeah. Theres a reason hes the most favorite guest host on saturday night live. What does mike pence have to do to improve peoples view of donald trump, for example . I think mike pences goal is to say look he could be president. You know he could be qualified to be president if donald trump wins in four or eight years. But i think youre going to get more policy out of this debate than certainly you saw the other ones. I think some policy questions. But i think jimmy is right there will be some hard questions. A hard question would be, mike pence do you think Hillary Clinton is a bigot because thats exactly what donald trump called Hillary Clinton. That would be putting him onthespot. That would be making him a little uncomfortable. That would certainly make news. Jimmy, i see you nodding your head. Dont you think mike pence is used to those questions at this point. He does. His responses have been doggone good. He said im not into name calling. I dont want to go down that path. Thats a smart thing to do. At the same time if im the moderator im going to want to distinguish between what pences policies and tim kaines policies are versus their bosses, their running mates. Thats important. You want to draw that distinction so you can see that this a difference between Hillary Clinton and tim kaine and conversely donald trump and mike pence. This is the second most powerful person in the country if they become the Vice President of the United States only by a heart beat. So they have to be qualified and ready and actually credible on that stump. All right. Got to go at this point. Jimmy williams, good to see you. Go longwood. Remember what they said at delivering alpha. We were hoping they would both get indicted and start all over again. Lets just vote tomorrow. 340r minutes before the closing bell. The Dow Jones Industrials are off. The s p is lower by is 12. Nasdaq is lower by 15. Johnson johnson warning patients of a Cyber Security bug in one of its insulin pumps of all things. Well have details and speak to the man who actually hacked into that device and caused the warning. Coming up. Time now for cnbc news update. Heres whats happening at this hour. Florida residents are being told to prepare for the worst as Hurricane Matthew looks more likely to hit there directly. Protecting life is our number one priority. If matthew directly impacts florida there will be massive destruction that we havent seen in years. This is a deadly storm approaching our coast. I cannot stress that enough. All of florida is under a state of emergency and hurricane warning is in effect for much of the states east coast. Sticking with florida, miamidade Officials Say a new pool of mosquitos have temporarily tested positive for the zika virus. The European Union has endorsed a Landmark International Climate Change agreement. The deal which is already backed by 200 nations including the u. S. Seeks to limit global warming. Friend and family and fellow golfers pay tribute today to arnold palmer. He was remembered today at a memorial that included speeches from jack nicklaus. Palmer died last month at the age of 87 and thats the cnbc news update. Back tougher. Bill, michele, im wearing arnies army pin because he had an impact on my life growing up as a golfer. Raising my hand too. Thank you. Good stuff. Heading in to the last half hour of trading with the dow coming down. Were down 85 points. Down 103 at the lows. Leading trader will tell us what hes watching. Also coming up the high end Real Estate Market in manhattan. It may be succumbing to gravity. Well discuss whether the slow down is a bad sign for the rest of the country. Retiringeted tires. And i never get tired oft. Are you entirely prepared to retire . Plan your never tiri retiringrt with e trad iin vests and as a vested investor in vests i invest with e trade, where investors can investigate and invest in vests. Or not in vest si up at etrade. Com and get up to six hundred dollars. Stocks are making a come back. The dow down just 78 points. Weve seen some volatility in some commodities. Crude oil, brent still around 50 a barrel level. Down eight cents. Wti was down 20 cents. Gold having its worse day since about 2013. Were going to talk about this later. Down 3 . Half an hour to go in the trading session. Whats going on today. Lets talk to peter costa. We started out well and then market doesnt seem to like a strong dollar. To when doesnt and thats not unusual. Any time weve seen the dollar rally we see market turn around. Theres a lot of other things going on as well. One of the things you have to put in place the volume is very light. Were seeing movement, light volume. Doesnt really pretend to be anything. But you still have to trade in this thf this environment. Most stocks were on the buy side. We might have a little rally going into the close. Financials are doing okay. Theres a creep in Interest Rates that everybody gets hopeful about. Absolutely. You have a fed governor that think theres going to be some sort of movement in november which to me is the most ludicrous thing ive ever heard. Truthfully i cant imagine any kind of rate hike or anything in november. December, maybe. Peter, good to see you. Peter costa empire executions and a cnbc contributor. As we mentioned earlier the british pound getting slammed today, plummeting to a postbrexit low. It hit a 31 year low against the dollar today. This on the heels of uk Prime Minister theresa mays comments over the weekend that she intends to begin the formal process of leaving the European Union by march of 2017. Joining us now, so pleased to welcome our long time colleague jeff cutmore from london. First time youve been to the New York Stock Exchange. Absolutely the first time. Whats that about . What took you so long . No one of invited me. We have our own issues in the uk as far as brexit. Lets talk about that. You know, are we going to see a full version of brexit . Theres talk about brexitlight depending on the kind of communication that may still exist between Great Britain and the European Union. Whats the feeling right now . Theresa may the british Prime Minister has made it clear that shes looking at the harder rather than the soft option. Immigration was a big issue when it came to the referendum and i think that she feels to keep, you know, the populist support behind her she will need to insist upon that. Sooits red line as far as this British Government is concerned. So i think it means that brexit will be negotiated on those terms. Obviously the market is drawing its own conclusions and saying hey brussels is saying if you insist on restricting the Free Movement of people in europe then we are not going to give you full Market Access to the european market. I think people are drawing their own conclusion. Bill this, process will take over two years. Its the slowest divorce in history, i think. Last time jeff and i saw each other was that night. We spent that night together on the set. We watched. Dont tell my wife. Although she knew where i was. We were shocked to see the pound start plummeting that night. But that night we thought they would trigger out of 50 by december. They said were going to do it right away. March looks quite far way relative to what people were expecting. So many surprises in whats happened here because originally as you recall suddenly we got all these messages from brussels, okay, if you guys want to leave get on with it. Do it now. Lets start. Now that shes given a timetable i think the french and germans are looking at their electoral process in 2017 and saying hey, maybe this is not such a smart idea. The other thing that they will be grappling with at the moment the pound falling as it is because all of a sudden this is a free swing at the bat because the pound feels like its find agnew range. The Industrial Production numbers and the manufacturing numbers are gradually improving for the uk here. And if you are looking for a trade, i mean weve seen whats happened to the ftse. If youre looking for a trade, anybody thats making big foreign earnings, they are doing great. How about all of that incentivize people in france and italy. It must terrify the eu to see how they are benefiting. The political leaders are, frankly, quite nervous. They see far right parties in their own countries that are gaining support by pointing to the challenges with immigration, the way that the whole migrant issue has been poorly handled by europe. The mechanism very slow to respond to the challenge of that flow of migrants coming in from the middle east and frankly they are nervous. I tell the bigger problem is really one of reform and you hear this constantly from mario draghi at the ecb, and others who want to see a more capitalist european economy. The biggest challenge for these guys is they need to get on with reforming labor laws, they need to focus on bankruptcy procedures. Its been ten years. We could be here all afternoon just talk about this. Its been like this since 2009. Well let them solve the problems. Well just identify them. Wonderful to see you. Thanks so much. Dont make it 22 years the next time. Okay. Come back again. So glad to have me in. Jeff cutmore joining us here. Nine minutes before the bell. Dow jones industrials average is lower by 73 points. S p is lower by nine. The nasdaq is lower by nine. Up next a slow down at the high end of manhattan real estate a harbinger of things to come in the rest of the country . Our robert frank has some answers on that. Also coming up well speak to a Cyber Security specialist who hacked into this Johnson Johnson insulin pump. Its not an episode of homeland any more. Its real. Crazy. Approaching medicare eligibility . You may think you can put off checking out your Medicare Options until youre sixtyfive, but now is a good time to get the ball rolling. Keep in mind, medicare only covers about eighty percent of part b medical costs. The rest is up to you. Thats where aarp Medicare Supplement insurance plans insured by Unitedhealthcare Insurance Company come in. Like all standardized Medicare Supplement insurance plans, they could help pay some of what medicare doesnt, saving you in outofpocket medical costs. Youve learned that taking informed steps along the way really makes a difference later. Thats what it means to go long™. Call now and request this free decision guide. Its full of information on medicare and the range of aarp Medicare Supplement plans to choose from based on your needs and budget. All plans like these let you choose any doctor or hospital that accepts medicare patients, and there are no network restrictions. Unitedhealthcare Insurance Company has over thirty Years Experience and the commitment to roll along with you, keeping you on course. So call now and discover how an aarp Medicare Supplement plan could go long™ for you. These are the only Medicare Supplement insurance plans endorsed by aarp, an Organization Serving the needs of people 50 and over for generations. Plus, nine out of ten plan members surveyed say they would recommend their plan to a friend. Remember, medicare doesnt cover everything. The rest is up to you. Call now, request your free decision guide and start gathering the information you need to help you keep rolling with confidence. Go long™. It has been said that there is no investment quite like manhattan real estate. But that belief may be challenged due in large part to market changes that not even the land of bright lights and Tall Buildings is immune to. Robert frank joins us with more. I was unaware. I thought there was a law prices couldnt go down in manhattan. Seems to be. The law is being tested. Not violated but tested. Real estate sales in manhattan falling 20 in the Third Quarter compared to a year ago as wealthy buyers are pulling back their spending and new luxury condo towers are piling up unsold throughout the city. There were 3,000 sales in manhattan. Down from 3600 last year. According to a new report today. The number of properties for sale were also increasing, the time it took to sell a property that went up. And theres now a six month supply of inventory. Bidding wars are fading and discounts are more common. Discount as relative term in the city where sale prices is 2,032,000. The biggest declines at the top especially those trophy apartments and brand new condo towers. Inventory of jumped 20 . Growing two and a half times faster than the inventory of resale apartments. And its likely to get worse. The Third Quarter results were artificially inflated of new apartments that went to contract in not good times of 2013 and 2014 but only closing now because the buildings are being finished. The most expensive sale in the quarter was 88 million for a penthouse at 432 park. 8300squarefoot apartment. The highest residence ever sold in manhattan. On the 85th floor and that apartment went to contract in 2013. The buyer was a saudi real estate magnet. Not too many saudi magnets looking for apartment. Little high for me. Come with an oxygen mask. What does this tell us about the national Real Estate Market . Weve seen a surprising slow down in the last quarter in all of the high end markets. Hamptons, palm beach, greenwich, beverly hills. All these markets are down 20 , 30 , 40 in terms of sales. Prices are still there. What youre seeing theres this big standoff where prices arent moving but youre getting a huge pile of inventory. That may be the crackdown on corruption in china, saudi oil situation. Yeah. Et cetera, et cetera. I call at any time great inversion. For years the top was strong and middle and bottom was weak. Now its reversed. The top is weakest. Higher you go weaker the market. 83rd floor pretty high. Very high. Robert frank thank you. Heading to the close, 13 minutes left in the trading session with the dow down 84 points. Why emerging markets could be ready for a break out. Jake reese, day to feel alive jake reese, day to feel alive jake reese, day to feel alive ten minutes left in the trading session with the dow down 88. Art cashin is back. He had a hairline fracture in his foot. The market on closed orders shows an imbalance of 300 million to the buy side. Rear seeing the impact of that. Joining us on the floor of the New York Stock Exchange jeff from Renaissance Macro research. Youre here to make the case for transportation stocks out there . Transportation, air Freight Logistics and machinery names look good. One area thats starting to percolate. Meat and potato kind of companies. Basically. Caterpillar. One reason we think is you got from a longer term perspective this turn in emerging markets on a relative basis versus the developed markets. The developed includes all of europe, the u. S. Which is the stand out. A lot of these things have floundered fedex cup look at emerging markets, they look fwoirts youre talking about the emerging market economies not necessarily the emerging market stock. Talking specifically about the stocks not the economies. Im much more interested about the stocks. Caterpillar does better when those emerging market economies buy more stuff to dig more mines and build things, right . What the stock price is maybe reflective of that but maybe not. Maybe Interest Rates rise. Historically right. We think the long term trend in rates is still down believe it or not. Even if the fed raises rates we think it will put pressure on the curve compress and we still think theres that downward pressure in rates. Havent done anything to break those trends. Anything that gets us above 170 on the ten year we absolutely think is a buy. Thats so interesting. We talked rising rates. No, no. Long end of the curve and if they raise rates that doesnt necessarily exactly. Causes a slow down in the economy. In fact, since world war ii every time the fed raised rates except for the last time the ten year yield has gone up. We think its a very good indication that things are different this time if we see the contraction in the ten year yield. Who else besides cap . Fedex, u. P. S. Some of these defense names, general dynamic as an example look pretty good. Those are those areas of industrials. If you look at energy we started to see a little bit more improvement in energy. The one area thats not influenced by the fed, this correlation is essentially zero between the fed anticipated rate hikes and the sector is technology. So if you dont want to call on rates, still look at tech. We think thats pretty interesting. What about emerging markets, buy an index or stocks. Buy an index. The core em look better than the frontier. If people want to buy the frontier thats where the value is. We look at it and say the performance of the ems so bad versus the frontier names look better to us. Russia, india, china. Exactly. Good stuff. That was interesting. Jeff, thanks very much. We will take a break here with the tow down about 88 points. Closing countdown in just a moment. And its a fight to be second. Well go live to farmsville, virginia to preview the Vice President ial debate between tim kaine and his counterpart mike pence. Youre watching cnbc because first in business worldwi were first in business worldwide. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. Im in vests and as a vested investor in vests i invest with e trade, where investors can investigate and invest in vests. Or not in vests. Sign up at etrade. Com and get up to six hundred dollars. About three and a half minutes left with the dow down 91 points. Bob pisani joining me for the closing countdown. Its safe to say one of the things people were talking about today was the british pound. Yeah. Down to 1. 27, 31 year low against the dollar. Why may came out yesterday and said that they were going to have a hard date for the brexit when they havent negotiated anything i dont know but put pressure on the pound. Dollar is up. England is on sale for sure. This had pressure on a number of other groups. Gold, for example. Are you looking at my notes. 25 years weve been together. Chances are something is going lower. In that case its gold today down to a three year low here. Worst day in three years. I saw 1230. Its 1270. Gold is at the lowest level in many, many months. Its a postbrexit low, essentially. Oil hanging in there, though. In fact, we will get we think well get the api Inventory Data in 30 minutes. Well see what that does because we are still seeing some build in inventory and that could put some pressure on that even though brent is still at 50. You see what wti is doing at 48. 62. Finally what did i do with the stock market today . We had as art cashin put it and so great to have him back the last trap door that was sprung at midday and we were down about 130 points at one time. There was some reports out in the middle of the day that the ecb was considering tapering its bond program before concluding qe. It put a little pressure on bond yields. I want to point out moving up on yields recently. Banks had a good day which would be beneficial of high rates. 1. 68 on the ten year. Key, suntrust, citigroup. Ive been highlighting this all day. Look at utilities, at the lowest level. Riits lowest level since may. Telecom will close at the lowest level since june. I mentioned the dollar strength. You were talking about that as well. And you see whats going on not just with gold but gold miners. Were seeing five, six, seven, eight percent. All double digit declines. We made a big thing in the middle of the year about low volatility stocks versus high volatility stores low volatility stocks tending to be names like yoimts, consumer staplndp utilities, Consumer Staples. Its those higher beta names that have been doing better in the last couple of weeks. Interesting little reversal going on. Thanks, bob. See you later. Going out with a decline of almost 100 points on the dow. Hart is ringing the closing bell and paraten. Welcome to the closing bell. Im Michelle Carusocabrera in for kelly evans. This is how were finishing the day. Dow jones industrials average and nasdaq finishing in the red. Industrials lower by 84 points. 18,169. S p at 2150 with a decline of 10. 23 and nasdaq 5289. Google announcing a new sweet of hardware from new phone to Virtual Reality head set. Home assistant. Well look at whether or not the Technology Giant can compete with apple, amazon. Johnson johnson warning consumers that one of its insulin pumps is hackable and the company is working on security issues. Coming up well talk to the hacker who reported the vulnerabilities. Hes the guy that did it. Join us as mike santoli joins us. And were join by kim forest. And fast money trader tim seymour. Mike santoli, let me start with you. Starting to see a little creep in the rise in Interest Rates aint rates sensitive sectors selling off all this week. Theyve been on the defensive for several weeks. Today this mini rate panic a reminder what happened several weeks ago. We got up to 1. 7 on the ten year yield and that makes the bottom fallout of the ration educational for owning the pure yield. Other influences were going on today too outside of equities really. The dollar rally i think you have people, another turn of the screws saying Central Banks maybe are looking for a way to exit some of these policies. Not a dramatic way. Not a way that necessarily means you have to really panic but i think the stock market is sniffing these things out all at once. You saw a reversal in emerging markets. With this rate rise, strong there are, lower gold, whats the market trying to tell us right now . What is it setting itself up for, do you think . I think the comments from the fed over the last two days remind me of where we were three weeks ago when we had people were put on high alert this wasnt just about one or two but maybe even a cycle. That wasnt said in the last 24 hours. But i think you got the message loud and clear that november is possibly in play. I think higher rates is, are the reality that equities have to deal with. I think in the case of gold, you had a case where probably too much was expected of gold too fast. I get the all weather kind of, you know, approach to investing in gold but this is something you have to be careful about. Kim, same question to you. What do you think is the message of the markets here . I think the markets are reacting to the fed just like the fed wants them to react. You know, i think they i dont know if its trial balloon so much as they would like to get the discussion that they have in their meetings out there in the world to let us know the variables that they Pay Attention to and maybe that the markets will relax and understand the thinking behind these moves. So it might be november, might be in december, might be in the middle of 2017. We dont know. But, you know, i guess the markets are reacting. And everybody gets to see that. That being said, we are entering earning season and im super excited because thats going to actually tell us a whole lot of information about winners and losers and where companies and people are really spending their money. Yeah. I think theres an interesting point. Almost every professional investor likes when we get around to having Corporate News not just about macro. Maybe were entering one of those phases. I do think theres a shot the Third Quarter, almost break even in terms of yearoveryear corporate earnings s p 500 was supposed to be down by 2 . But then theres a general sense that 2017 numbers are way too high. So i dont know where that shakes out in term of the market field position. Absolutely tim seymour we were whoepg it comes to earnings season we were getting out of that trough movement, finally move inphotos negative yearoveryear comparisons. Pick your sector. If youre in health care youre in good shape. In the industrial sector youre in good shape because expectations are solo. Youre coming off a low base or expectations of a low base. Look how ford and gm have trade after poor auto sale numbers. Look how airlines are trading in the face of some concerns about the economy. I think its about where valuations are and where expectation are. So stay in industrials thats the place to be. Kim forest, youre excited about earnings. Who are you most excited about. Oh, golly. I guess two fold. I love tech and i love retail. They dont seem to go together. But we in the last year have found a lot of value there. What i would really like to see is companies continuing to spend and that would be in tech and were going to think that people that serve the cloud are probably the winners in this quarter. Thats what i want to see the microsofts reporting that more people are going to azure than they anticipated. When you say you found value there what kind of metrics are talking about you see both in retail and technology . Well there were some unloved names earlier this year that looked good. One was urban. You know theyve had misses. They bought a pizza chain. It was a real head scratcher. We think they are great. Merchants and i dont care what the trends are, you have to pick a retailer that knows how to pick trends and we think over the long haul its urban outfitters. One that is down and unloved is vf corp. They have a track record through many, many cycles of fashion being able to outperform. Sell sweaters, deep dish, sell it all. Certainly. Actually, the news about the pizza acquisition was the low in the stock. It was so ridiculed they bought it. Pizza is an experience. We have breaking news. Those earnings from micron. Youve been waiting for earnings. Dominic chu how did they do . We have shares down by a percent on 365,000 shares worth of after hours volume this after micron comes out and reports a loss per share of five cents. That beats the average analyst estimate of a loss of 12 cents per share. Revenue coming in better. 3. 22 billion. Average were looking for 3. 1 a. Ceo of the company saying they are seeing improved Market Conditions in terms of slowing supply growth and improving demand as well. Both sides working out in their favor. They say dynamic random access memory is a type of semiconductor, Sales Volumes are up 20 . Prices are down 6 . And Sales Volumes up about 12 as prices are unchanged as well. A little more color from sales mix over at micron. They are a leading producer for many of mess semiconductor, smartphones and tablets. Keep digging through this. We should note also that the shares are down 2 now on 392,000 shares worth of volume. Shares were on a dwreer date basis up 26 and up 12 over the last 12 months. Back to you. Moving lower. Down over 2 . Kim forest i know you like intel. You own it. What about micron . You have to keep an eye on all those guys. Absolutely. Ill tell you those super strong numbers are just great for anybody in that complex. The pc vendors but also the chip vendors. I think those were very, very strong results. Tim seymour, what do you think . Micron we have a positive announcement in september which was the beginning of a turn in this cycle for them. Drand supply is slowing. Again its a company that has had a lot of good news into the stocks. Stock is up 90 off the lows. Im not sure how far to do a lot with anonymous. The transition for these guys in that space is Getting Better and better. Up 90 until five months ago. This is a stock that has these ridiculous streaks from 5 a share up to 35 down 9 up to 18. So this is people thinking that they already got ahead of a better part of the cycle. Sales beat is what you want to hear. Like buying a commodity producer. Is literally what is it. Gold miners, copper miners. Kim forest why do you like intel over micron, for example . I just like their higher margin business. And its a little bit more diversified. We really think that they are not just the pc company that everybody kind of paints them as. They serve a lot of kind of weird end markets. But i look for growth of servers to continue, you know ill be dead before servers start slowing the growth. Its just a matter of computing today. They execute really, really well. All right. We have a market flash im told and therefore we go back once again to dominic chu. So it was just a little bit before the close of regular trading, michele, bill but i want to call your attention to whats happening to team health holdings. The ticket is tmh. Its up fractionally but just before the close bell the shares closed up 16 on about 2. 1 million shares worth of volume. That very much higher than its average Trading Volume over the past three months. This coming on the heels of dow jones headlines saying team health is exploring a possible sale of it self. This is a company that does outsource health care solutions. The company is in talks with private equity firms according to source familiar with the matter. We want to call your attention to that particular stock because it did make a sharp move higher just before the close bell. Well bring you more details as we know more. Thats the reason why those tmh shares guys are moving. Back to you. Any thoughts on that one . No, except its been an active area. Community health adopted poison pill because its gotten some interest. Not too much of a surprise. I can see micron again . Did i see that it turned positive . It was down 2 after knew chdomu announced. Yeah. Its gone positive here, tim. Did you buy it or something. What happened . Sleight of hand. What can i tell you. Heavy short interest. Thats part of the story. I think it gets back to the pc market is stabilizing at least. Supply drand sunday control. People want to see this stock go higher. It has. That volatility that you were referring to before. Yeah. Its not going to bore you. Buckle up. Kim forest good see you. Tim seymour see you next hour. Tim and the rest of the crew coming up on fast money, tony dwyer thinks stocks are set to break out in the next two weeks. Hell explain why and how you can profit from that. As the internet of things expands hackers are finding new targets and could affect your health. Your life. St. Jude medical recently refuted claims that its pace maker was vulnerable to a cyber take. Johnson johnson is warning one of its insulin pumps has a cyber bug. Well talk to the man who hacked into it. Google announcing google home but after amazons echo are they too late . How the device stacks up against its competitors coming up. Youre watching cnbc, first in business worldwide. What are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you ed 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. Weve just been hearing youre a digital company, yet here you are building a jet engine. Well, ge is digital and industrial. Like Peanut Butter and jelly. Yeah. Ham and cheese. Cops and robrs. Yeah. Nachos and karate. Ahh. Not that one so much. The rest were really good. Socks and shoes. Ok, ricky. Narrator it wasnt that long ago. Years of devastating cutbacks to our schools. 30,000 teachers laid off. Class sizes increased. Art and music programs cut. We cant ever go back. Ryan ruelas so vote yes on proposition 55. Reagan duncan prop 55 prevents 4 billion in new cuts to our schools. Letty munozgonzalez simply by maintaining the current tax rate on the wealthiest californians. Ryan ruelas no new education cuts, and no new taxes. Reagan duncan vote yes on 55. Sarah morgan to help our children thrive. Illinois treasurer announced yesterday the state is suspending investment activity with wells fargo in the wake of the banks fake accounts scandal. He told us on this program how much revenue he thinks wells fargo could stand to lose due to the suspension. Well its sort of like we, they are the best bid. Its like if you were putting a new roof on your house and you took the best bid out there, you know how much you paid to the roofer but you dont know how much they actually make off of that. We think they make millions of dollars off of those transactions. Wells fargo emailed cnbc, us as a matter of fact after that interview with this statement. Respectfully, the actual amount in lost revenue for the company from business conducted with the Illinois Treasurers Office is approximately 50,000 per year. That statement from wells fargo. Todays news broke louisiana senator david vitter sent a letter to wells fargo saying thousands of Small Businesses were also affected by the banks practices. Reuters is reporting 10,000 Small Business accounts were affected as a matter of fact. I gave the treasurer a hard time yesterday as you recall. I recall. You asked what i would rather have them do. Would you not take punitive action against wells fargo for what they did. Heres what i wish they would stop doing. I wish they would all stop pretending they care so much about me and us. The treasurers and politicians. All of them. I gave the illinois treasurer a hard time but one of many who have been willing to just dump on this bank which theres no defenses from what wells fargo did, right . Im not making that point. But to have all these politicians tell us about how they are protecting us. How they are standing up for us. They are standing up for themselves. They do this only because they think it helps them get elected. Both those news items the illinois, the actual number plus David Vitters number it fits with this entire story which is really financially trivial for wells fargo but just not going away in terms of public outrage and response. Those two things thats what wells fargo will be dealing with for a while. 2 million accounts. Returned to investors, more than a buck an account. Not defensible. Representing the fees that were charged to those people. Still indefensible. Just know if youre a treasurer out there thinking of doing this she wants to talk to you. You want your pound of flesh. Johnson johnson revealing some disturbing news today regarding Cyber Security of one of its medical device. Meg terrell has the details. We heard maybe pace maker could be hacked into. That was one of the plots on homeland. Today Johnson Johnson wrote a letter to more than 100,000 patients that use their insulin pumps warning about its one touch ping insulin pump. Outside research an expert in Cyber Security identified potential of hack risk here. No patients have been harmed here. This is a story originally reported by reuters this morning. The way this works the pump has a remote control. So it uses an unencrypted radiofrequency. This could be hacked into by somebody wanting to cause someone harm and giving them a dangerous level of insulin. I want says the probability of unauthorized access to the one touch ping system is extremely low. I learned from talking with j and j somebody has to be within 25 feet of somebody wearing this insulin pump, having strong skills and hack into this system and want to harm somebody. These kind of Cyber Security issues have come in to focus a lot with muddy waters teaming up with company medsec shorting st. Jude stock over the security of their heart devices. Fda is investigating this. St. Jude has refute this and suing both of those parties. This is an ongoing situation. Fda in terms of the Johnson Johnson situation said this is the kind of proactive behavior that the fda has been looking for from the Research Community and demonstrates the collaborative manner in which vulnerabilities can be addressed in a way that best protects patients. The guy that did this did the research on himself. While hes not using this any more its not because of this risk. Lets talk to him. Stay right there. Were going need your help. Lets bring in the man who was able to hack the insulin pump. Jay radcliff. You are a diabetic. J and j is painting this as its highly unlikely, difficult, logistics dont make sense. How easy or difficult in your view since youve done it is it to hack this insulin pump . Sure. You know its actually quite difficult. I agree with the assessment that Johnson Johnson has made that theres that extremely low risk to the patient. The patient should stay on their medical treatment and continue to use their insulin devices so that way they can stay healthy. Are you worried you scared everybody as a result of doing this . Whats the framework for thinking about this . I think the framework around it is for people to be able to make good decision around the risks they take. So, you know, the example i gave is when you go out driving some people dont like to drive when its raining or snowy because its too risky. In this case we need to give users and patients the information so that way they can determine if its too risky for them or not. As a result of this, Johnson Johnson reaching out in its letter giving a few things people can do if they are concerned about this. Turning off the radiofrequency. Do you think these kind of mitigation strategies is enough to keep this pump safe for folks . Absolutely. Johnson johnson and rapid seven worked very hard at testing out these mitigation strategies and testing out these solutions weve published and they especially turning off the radiofrequency portion works 100 at eliminating the risk. Did you just do this on your own or you wanted them to worked in collaboration with them in advance. I did not work with them in collaboration in advance. This is independent research. It was my personal device that i did the research on. This is just out of my own personal curiosity how these devices work. Meg mentioned its unencrypted. Should it be encrypted. These devices were designed quite some time ago. In this case in particular this device is often years old in its design. Newer devices because these devices take some time to get through the regulatory process and engineering new devices are going to have encryption. As we study them and do the independent research i want to validate that. For the average person right now the conclusion i would draw is if i have one of these i got to have a really, really smart person nearby me who hates me, right . That would be the highrisk scenario, correct. Like if you were a nation state leader or like the president of a country that that would be the scenario that i would consider. For the nch every day user they need to take care of their diabetes and their health. Some days thats my job description. I know were almost out of time but i want to ask you with this idea these devices are mean to last years inside the body but we think about a 5yearold cell phone and it would be ridiculous for a person use that. Is that a problem with medical devices. They are supposed to last so long but the rest of the world advances as youre wearing your fiveyearold pace maker. As we go forward and see these new devices coming out manufacturers will adapt to that. They will have the ability to update. They see the threats and research were doing and reacting to them appropriately like Johnson Johnson has. Jay, good stuff. Very nice to meet you. Very enlightening. Appreciate it. Jay radcliff. Thats so cool. He told me when he was little he was so curious he went around taking the door knobs off the doors to see how they work. Very good. That sound like my brother. But he didnt go on to do that. Cnbc is partnering with the Aspen Institute and m. I. T. For the Cambridge Cyber summit which is tomorrow. This one Day Conference will bring together leaders in security, technology, defense and business to discuss how we can better secure americas future from cyber threats. For more information and if you still want to register go to cnbc. Com cybersummit. Google is looking to fix its lack of hardware with a new feerngs Virtual Reality system and also a physical home assistant aptly named google home. Will it be enough to compete with the likes of apple and amazon . Mr. Wonderful kevin oleary will weigh in next. Were less than five hours away from the Vice President ial debate coming up tonight and well headline to farmville, virginia for the latest and what each candidate needs to do to stand out during that debate this evening. Well be right back after this. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. On a perfect car, then smash it into a tree. Your Insurance Company raises your rates. Maybe you shouldve done more research on them. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claims centers are available to assist you 24 7. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. But i keep it growing by making every dollar count. Thats why i have the spark cash card from capital one. With it, i earn unlimited 2 cash back on all of my purchasing. And that unlimited 2 cash back from spark means thousands of dollars each year going back into my business. Which adds fuel to my bottom line. Whats in your wallet . Google captivating San Francisco today with the launch of a new hardware line from the new google brand pixel smartphone. Smart home hub thats supposed to rival amazons echo. Well talk about that in a moment. Despite the hoopla google may seem a bit behind in the hardware tech game leading us to ask the question is it becoming a follower and not a leader in tech land. Lets bring in our friend kevin oleary along with dan ackerman. Dan ackerman, what do you think . You go down the line here. A new smartphone. Weve seen that already. We got the google home. Weve seen that in the amazon echo. On and on. They are just playing catch up . In the hardware sense. Theyve never bean hardware company. They are not going to be a hardware company. They outsourced the design and production of these devices to other companies. With the pixel phone and the home assistant they are trojan horses for getting Google Services because they are a software and Services Company into your house and having you use them across a whole family of devices. What do you make of this move, kevin . I dont get the phone move at all. It seems dumb. Bringing another commodity toaster slab into the market which is what a new phone is makes no sense because android itself is the trojan horse. Its on over 80 of the phones that are bought this last year around the world. You dont need to compete with your own trojan horse. If i were Samsung Apple makes all their money on that phone. They want to grab a piece of that. Can they . But they dont need to. Their operating system is y ubiquitous. Whats interesting is google home. If you want to make money on home and the big negative on google, its between White Elephant on the stock forever. Theyve never been able to diversify out of that. Theyve spent billions of dollars on all kinds of crap like glasses and internet from space and initiatives they shouldnt have wasted on and focus on things that do work. Google home. You walk in and say i want to sent flowers to my aunt. I want to fly to San Francisco. You have an coke . Sorry. Do you have an amazon echo. I dont yet. Listen. Its really early. But the point is if you think of a company the three that will play for this, amazon, definitely apple, i expect microsoft at some point. If google can get involved in that all the services you can sell to the family that is just sitting there listening to them that to me as an investor thats interesting. The phone is crap. To me it reminds me of the old days of microsoft, right . With the dominant franchise youre sitting there and your Company Business throws off so much cash. Here google sits, alphabet sits with 65 Gross Margins and can try whatever they want to. Microsoft initial foray into game consoles and other hardware. Eventually you might learn what your spot is in those areas. I just wonder if thats analogous to how google thinks about these things. Dan your skeptical . You open up googles numbers every quarter and you think about all the stuff, other stuff they do and you look oh, yeah this is a search company. This is what they do. Can they ever be anything but a search company, dan . They want to be universal company. Thats why whenever theres a new area of interest they want to at least get in it and try it out. Sometimes when we talk about gmail dominant force of email on the planet now. When they started everyone said no one will want an online email server. Thats crazy. Google officers. Google docs. So some of these moonshots work. Some dont. They want to every time we talk to the google home youre giving google data what you want and what youre doing and how are you different devices and your family works with them. Thats valuable stuff besides selling you a plastic box. I would stream taylor swift not steely dan. Im a steely dan fan. I have to vote for that. The fact that none of this will move the needle that much on a behemoth. Are we making much about very little right here well i have two beeves with the stock and i dont own it. One it never returns capital. I watch it waste it on these moonshots. If i were a shareholder i would be unhappy. For the first time ive seen something with google home that intrigues me as a shareholder potentially. You like that . I can think of diversification on services. I can think of 3 , 6 every year that can sell on a device thats going into the home. At some point that Company Heads to some adult supervision to say stop wasting money. Is this negative of dual voting shares. I tell all my classes that. Never buy a stock that you dont have the same representation. Thats how we founded the country, remember . No taxation, no representation. Same thing with dual voting class share. Tell that to the people in washington, d. C. I digress. The shareholders are okay with the stock going from 300 to 800. Its todays purchase you have to bother. You can always talk about the past but the new incremental dollar going in. Ken always good to see you. Dan too. You never know what hes thinking. Time for a cnbc news update with dominic chu. Hurricane matthew is pounding the island of haiti where theres severe flooding and wind damage already from the category 4 storm. Meanwhile southern u. S. States are in preparation mode. Florida has issued a state of emergency and south carolinas governor is ordering an evacuation of coastal counties starting tomorrow afternoon. Staying on the eastern seaboard firefighters in baltimore are on the scene of a massive three harm factory fire which broke out after 1 00 p. M. Today. Not known what started the blaze. One fireman has been taken to the hospital for possible heat exhawks. Secretary of state john kerry says russia is turning a blind eye to syrians use of chemical weapons by giving the military support. That comes one day after suspended talks with russia. How about this, guys . Want a new apple mac computer but cant afford it. Try this candle. The company that makes it says it smells like one of those pricey Computers Brand new but only cost 24. I like new car smell but im not sure about the candle. What does a new computer smell . Thats the news update. Smells like inside a factory in china when you open up the box. There you go. Well done. Dom, thank you. Gold falling more than 3 today. Its worse day in nearly three years and hitting its lowest levels since the brexit vote. Between Political Uncertainty in the eu and u. S. President ial election is gold your best safety play or is there more room to fall . Well try to answer that question with somebody who should know when we come back after this. To this is the api american petroleum, the organization that represent oil companies. They say for the week we saw oil vince actually take a draw down, again crude inventories fell by 7. 6 Million Barrels in the week ending september 30th. That compares with analysts expectations for around an increase of 2. 6 Million Barrels. Also pointing out now as well that gasoline stockpiles rose by 2. 9 Million Barrels compared with analysts expectations of 072,000 barrel gain. So thats the reason why we saw Oil Prices Move about 48. 65 or theres about before the number around 49. 25 after the number. Well keep it on crowd oil because of those api inventory numbers. If expectations were for a decline thats 10 million barrel spread. Thanks for joining us. What do you make of this . Very constructive for crude. The expectation was a build with the api numbers. Thats another constructive factor. Were pushing up against 50. Weve already touched it on brent. Will we reach 50 on wti. There are some headwinds for crude once you get above 50. Producer hedging. The api numbers only help coming on the back often peck story. We talked about this the last time you were here, you got the u. S. Producers who will want to get back in if the market takes the price high enough . I think whats important so peck is not aiming for 7080. They are aiming for 50 to 60. I think they believe that brings the permean back on. So they are looking for a price that allows them to meet their fiscal needs for saudi arabia to get that ipo off the ground but they dont want to bring back all u. S. Production. We have a lot of confidence that saudi can stick opec nek to the landing. I think it will be saudi going to ua ercuae, to qatar let this done. Ill sound so smart the next Cocktail Party guy to we talk oil. Ill say i think it brings permean back in but leaves bachon on the sidelines. There was a time when oil going up was very good for the stock market. Is that still true . In sectors. Not necessarily linked that tightly because i do think when you were near the lows for oil, you needed it to go up to rescue the high yield market and basically have the sense it wouldnt be this really chaotic liquidation of assets. I dont think its necessarily going to take the market higher if we go to 55. But helping airlines and industrials are moving with crude oil. Gold got hammered. Down 3 . Whats going on . Is that a buying opportunity . We think its a little bit overconstructive on gold. We just dont think theres a lot of consumer demand for gold. Not a lot of central bank buying, not a lot of jewelry buying. What drove gold higher was the investor rally. If theres some other big risk event that will help gold. Somebody was saying that in an Election Year thats when gold usually bottoms out. We have to see the result of the election. That could be interesting depending who wins it. That could be the risk off opportune. Thanks. Good to see you. The old adage in politics nobody votes for the Vice President. But this could be the first election that it turns on its ear given the unpopularity of Hillary Clinton and donald trump. Well preview tonights running mate debate. Facebook and google could be causing problems for bay area restaurants. Wait until you hear whats going on out there. Its coming up in just a moment. Bottle of white a bottle of red perhaps upgrade your phone system and learn how you could save at vonage. Com business [ thats a good thing, eligible for medicare . But it doesnt cover everything. Only about 80 of your part b medical expenses. The rest is up to you. So consider an aarp Medicare Supplement insurance plan, insured by Unitedhealthcare Insurance Company. Like all standardized Medicare Supplement insurance plans, they could save you in outofpocket medical costs. Call today to request a free decision guide. With these types of plans, youll be able to visit any doctor or hospital that accepts medicare patients. Plus, there are no networks, and virtually no referrals needed. Join the millions who have already enrolled in the only Medicare Supplement insurance plans endorsed by aarp. And provided by Unitedhealthcare Insurance Company, which has over 30 years of experience behind it. With all the good years ahead, look for the experience and commitment to go the distance with you. Call now to request your free decision guide. Gilman go get it, marcus. Go get it. Coach gilman used his cash rewards credit card from bank of america to earn 1 cash back everywhere, every time. At places like the batting cages. [ crowd cheers ] 2 back at Grocery Stores and now at wholesale clubs. And 3 back on gas. Which helped him give his players something extra. The cash rewards credit card from bank of america. More cash back for the things you buy most. One candidate has been called the step dad next door. The other has the secret Service Code Name hoosier. Both democratic Vice President ial nominee tim kaine and his counterpart mike pence are veteran political hands in their state houses and also on capitol hill. Both have a job to do tonight. John harwood is in farmville, virginia the site of nights Vice President ial debate. He joins us what both men hope to accomplish. John . Reporter well, michele, to answer the question you posed before the break, i dont think very many people are going voting one way or the other based on the Vice President ial nominees because lets face it as you said tim kaine and mike pence are bolt extent politicians but dont suffer an excess of pizzazz. They are not like joe biden and sarah palin who in 2008 held the most widely watched Vice President ial debate in history. Well see what numbers they get tonight. Donald trump said today hes going to try to help that out. He sent a tweet a short while ago saying hes going to be life tweeting the Vice President ial debate. In the end as both candidates try to prosecute the case against Hillary Clinton in the case of pence or against donald trump in the case ever kaine they are going to be playing against the backdrop of these huge personalities and figures at the top of the ticket and lets take a look at where they stand. The nbc survey monkey poll just out today we have Hillary Clinton with a six percentage point lead in a four way race over donald trump. She also has an advantage if you look at the real clear politic averages in those battleground states, 14 battleground states, Hillary Clinton leads in 11 of those states for a total if the election were held today based on those polls 322 electoral votes. Donald trump has got work to do between now and election day, between now and sunday when he has the second debate with Hillary Clinton and he hopes to get a little bit of a boost from pen pennsylvania perhaps prosecuting the case on trust, email, honesty against Hillary Clinton that donald trump didnt do so well with in the first president ial debate, guys. And, mike santoli and i were talking about this earlier. We believe they set the sights for the various debates before we knew who the nominees were going to be because clearly this becomes a home game for tim kaine tonight. Reporter it is a home game for tim kaine. The Debate Commission is pretty good about not having an audience that is stacked for one side or the other. You know, they discourage applause and that sort of thing. These tickets go out to supporters of the Debate Commission, some to the campaigns. But there arent a whole lot of rooting sections at these debates and republicans would have grounds to complain if thats something that develops tonight but i dont expect it. Any potential market impact, mike santoli from this . I dont know. I guess the question is doe it have the potential to reorient the prevailing conversation at all on policy lines, on anything else or make it seem like a tighter race. Fit seems like a tighter race then it has market implications yes because i dont think the market is assuming it will be. What are the chances of that. How often does a Vice President ial debate make anything change in the president ial race. Reporter rarely. What campaigns look at the Vice President ial debate as is an opportunity to clean up if the president ial debate didnt go your way. Four years ago for example you had joe biden trying to stop the bleeding for president obama after he lost that debate to mitt romney. The same thing happened in 2008. You had or excuse me in 2004 when george w. Bush was beaten by john kerry in the first debate and dick cheney came out with a Strong Performance against john edwards in the Vice President ial debate. Thanks, john. Thanks very much. You bet. Bay area bistros are losing their top talent to tech companies. What are they doing to fight back . Fun story when we come back. About it cause everything isoy unlimited. I need data and i need it now. Its the end of data limits for your business. Get unlimited 4g lte data as low as 30 bucks per line. Switch your business to tmobile work. The Housing Market is not the only casualty of the Big Tech Companies crowding Silicon Valley. Restaurants are now facing stiff competition to hold on to their workers as they leave for the kitchens and dining rooms at the likes of google and facebook. Aditi roy has the details. Aditi. Reporter hi, guys. Yes, im here at the cafe in San Francisco, and its a brand new restaurant, and its just down the street from twitter. And the program here tells me that one of the big problems is actually Companies Like facebook or twitter or google coming in and squeezing them out. Theyre having a tough time staying in business. A lot of restaurants are. The owner has four restaurants across town. And in the last three years, hes actually lost four cooks to Companies Like facebook and google that have signing options for the employees, enticing staff Silicon Valley restaurants. Hes not alone. We talked to a lot of Restaurant Owners across the valley feeling the squeeze from tech companies. In palo alto, 70,000 square feet of restaurant and retail space was lost to office space between 2008 to 2015. He says he started treating his company like a startup to fight back and offering employees perks from gym memberships and classes, but its still hard to compete. If youre interested in food, you could work for sprint or blue apron for twitter. Theres a lot of options where you dont have to work nights, weekends. You get holidays, vacation. You get comparable pay. Its a tradeoff for people so interested in culinary but want to go that route. That didnt exist five years ago. Reporter and he says that those perks are keeping his staff around a bit longer, but the root of the problem still exists. And guys, this really speaks to the latest iteration of that fundamental divide between the tech haves and have nots thats taken so many forms here in the valley. Back to you. Well put, aditi. What do you think when you see stories like this. Meh, meh, market peak its a distorted micro economy there. Theyre going to have to resort to sort of importing labor. In this case, though, i understand that one tech company crying foul and another tech company poaching employees. But a restaurant, there are people behind lined up for the restaurant, you would think, right . I understand the restaurant not being able a higherend restaurant not being able to maintain experienced staff when you have the company over there offering you benefits and stock options. Absolutely. And you dont have to work nights or weekends. Everyday kitchen staff and things like that. But the stories about the buses, the stories all of these stories are so reminiscent of 1999, the traffic. You cant get enjoy it while it lasts. And i hope it lasts a long time. Yes, you do. Developing story on microsoft. Dominic chu has that story. Its about technology, but tied to the story we brought you earlier about reports from reuters that yahoo may have been engaging in email scanning for users accounts on behalf of the u. S. Government. Those are all reports citing sources familiar with the matter. Now we at cnbc reached out to microsoft to ask if they did anything of the sort. Microsoft spokesperson did respond to cnbc by saying, quote, we have never engaged in the secret scanning of email traffic like what has been reported today about yahoo . And, again, thats according to a microsoft spokesperson. Also worth pointing out, we reached out to verizon for a comment, in the process of buying yahoo . They have declined to comment on the situation as of now, guys. Back over to you. Thats two strikes now, right . On yahoo . Dom, thank you very much. First the credit card yeah, the hacking. The hacking. The email accounts. And now this. Of course, all these companies were under a bunch of pressure. I see the Purchase Price going down and down. Well see. This is less something that necessarily who knows. It does seem like something not necessarily dont forget turning in the dissident in china. Google announcing reality hardware today. Mark cuban weighs in on the reality. Thats next. Remember here at ally, nothing stops us from doing right by our customers. Whos with me . Im in. Im in. Im in. Im in. One, two, wait, wait. Wait wheres tina . Doing the hand thing . Yep we are all in for our customers. Ally. Do it right. We are all in for our customers. This car is traveling over 200 miles per hour. To win, every millisecond matters. Both on the track and thousands of miles away. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. It begins from the the second were born. Er. Because, healthier doesnt happen all by itself. It needs to be earned every day. Using wellness to keep away illness. And believing a single life can be made better by millions of others. As a Health Services and Innovation Company optum powers modern healthcare by connecting every part of it. So while the world keeps searching for healthier were here to make healthier happen. Theres Virtual Reality and augmented reality which im an active user. People think pokemon just sets the stage. But really i think the grand slam is going to come from deep learning, Machine Learning. Ive got a lot of investments in Machine Vision and deep learning. Because as we create more data through our own use, through apps, through bots, sensors, that data can be processed now in ways that we werent able to process before. That, of course, was billionaire mark cuban on the next big thing in tech. Catch jims interview in its entirety tonight on mad money at 6 00 p. M. , eastern time. Final thoughts. Mark cuban is always a great interview. Says whatever he wants. He stays pretty excited. Still very scared. But you can play it both ways in terms of the data were going to be accumulating about us. Too much sometimes. I get very worried. Im not personally worried because i dont think ill participate. Im not worried at all. Well be back tomorrow. Somebody else with out at that time. Well find out who it is at that time. Thats it for closing bell. Fast money begins right now. Enjoy. Fast money starts right now. Live from the Nasdaq Market site overlooking new yorks time square. Pete najarian, tim seymour, tim nathan and guy adami. Of google launches a new of new gadgets, but can they compete against the likes of apple and amazon. A top strategist who called the summer rallies stocks are gearing up for a move higher in the next two weeks. Whats he looking at . Hell be here to explain. And later, theres one beaten down name thats got guy adami pounding the table. What it is and why hes excited. First we start off with the market. The action wasnt in the stock market, though. Check out the yield and