Comes on the heels of a disappointing quarter that saw the firm notch its worst ever results in the commodities business they say this is kbws note today we have more questions than answers about the franchises health at this point in time. Should we . Well. You take one quarter two quarters of bad trading yeah, we can ask the question. I think the question is a little bit bigger than one or two quarters this is a firm that over decades has had a little bit of a tugofwar going between Investment Banking on one hand and trading on the other hand. Youve had a guy at the helm for ten years thats a trader extraordinaire in years past youve had Investment Bankers like hank paulson running the firm i think the question is where are the Investment Bankers picking up slack from the trading which in the last two quarters hasnt done so well is it time to rethink owning this stock it is time to rethink it but when you rethink it youll come out its 1. 2 times book value. It can get a little bit cheaper but this is probably a good price on a price to book basis at which to own the stock. There is still this question as dick bove is putting out there josh, year to date goldmans down 7 versus Morgan Stanley which is up 9 , as is bank citis up 12. 5 . Jpmorgan is up 6 . Theyre disappointing with the stock performance, no doubt. But do you make a bigger issue out of it asking whether you should own gs . I dont own gs. I think two things the first is, ficc, when has that not been a mercurial business like why are we looking for consistent results all of a sudden in an area fixed income, currencies and commodities. It is not a secular issue because Morgan Stanley just put up a good quarter. So clearly you are going to have some quarters where one bank does better than the other thats number two. The third thing i would say is, this is a unique situation because were in a bull market for bonds, for u. S. Stocks, for international stocks, for m a. All these things this is like the first bull market i can think of where wall street wasnt absolutely just feasting so it is weird to see goldman in this position. I just dont know that id be like the guy to say, yeah, thats it, theres like this terminal problem with the greatest Investment Banking franchise of all time. I dont see it that way. The good thing is, you dont have to be because our next guest is that guy. With Goldman Sachs shares under pressure, some are placing the blame on Lloyd Blankfein, the ceo. Dick bove, an Influential Bank analyst who is calling for the ouster of mr. Blankfein. In the last year or so ive been write the about the lost decade if you go back to 2007 the company was making more money than it is making today. Over the last five years, revenues have flatlined, theyve not gone anywhere. Not only have they flatlined, but by 2016 if you were saying the average was around 33 billion, 36 billion a year, they couldnt even do that so far this year theyre not going to do what they did in 2016 and the reason for the problem is that they made a business decision ten years ago, which is that this market is going to come back. Well, it didnt. And the fact of the matter is that instead of taking moves the way Morgan Stanley clearly did, the way citigroup did, the way a number of other large bankers have, this company has simply gotten more and more insular it is a private company thats running under a public if you will name this stock sold at 250 back when Lloyd Blankfein first began there. Its selling at 30 less today thats ten years which company can you find out there that has a record as consistently bad as this one where Everybody Loves it it is not a phenomenal franchise if the company cant grow earnings over the last five years the stock price at Goldman Sachs is up 135 . If if you look at the key metrics of management performance and profitability, return on equity, nearly doubled over the last five years operating margins, near the top of the group second only of the major firms to jpmorgan. The way that blankfein guided goldman through the crisis the is there a better risk manager i would take jamie dimon first, if theres babe ruth, id take gehrig second. What about those metrics dont they account for anything . Youre picking your point of entry, right you decide you want to take a point of entry five years ago. Why dont you pick your point of entry ten years ago . If you take your point of entry ten years ago, all the metrics you are talking about are negative none of them are positive. In addition to which james gorman is the babe ruth, if you will jamie dimon is a babe ruth, if you will youve even seen Brian Moynihan at bank of america who is a babe ruth, if you will. These people have done something with their franchises. They have recognized that they were in an industry which had major secular changes impacting it, and they changed and they changed their company in a fashion to benefit their shareholders Goldman Sachs did not. And a iss a result of not doing that, his earnings have not gone up for ten years take your metrics back to 2007 dont start them in 2012 he did not guide this company through a period of constant improvement. He guided this company through a period of constant loss in share relative to the companies that i just mentioned some would suggest if Lloyd Blankfein is not there that goldman may not be there given what happened during the crisis. Why would they suggest such a thing given that Morgan Stanley is here . Bank of america is here . Citigroup which should not be here is here i have no idea why they would suggest such a thing i have no idea how this board gets away with doing what it is doing. I have no idea why a company which underperforms so consistently over such a long extended period of time is not even questioned by the marketplace. I mean, back in new york it is questioned by the marketplace, right there is a reason buy goldman shares are down year to date 7 . As i said, theres no comparison to the peers which are obviously up more substantially than that. All are in the green the xlf is up 7 that in and of itself tells a story that the market itself has begun perhaps to scrutinize goldman a little more. No yeah. And you got to look at that take a look at that 33 decline. No company does anything like that unless youve got years of problems that have accelerated within the company youve got a problem with the structure of the company there are Serious Problems within that division which the Company Refused to discuss yesterday. They just kept saying, commodities, commodities, commodities. You know, the fact of the matter is that its got to be more than commodities. 33 decline is outrageous. And it comes after years of problems in trying to get this business to turn around and move in a forward direction the Company Needs new leadership the Company Needs more than just a new Lloyd Blankfein. They need a shakeup of that board of directors that board of directors cares nothing about the shareholders of this company because theyve done nothing to protect the shareholders of this company this Company Needs change. I should also say, we reached out to goldman they have no comment they are likely watching right now because we alerted them that you were coming on, if they had a comment about your commentary. And they in fact say no. Steve weis has one though. Hey, dick, how are you . In some regards, every time you come on, it is like watching a mob. All you do is launch hand grenades if you look back ten years, youll see that the companies you cite had never hit the high they had in 2007 thats Morgan Stanley which is still about 30 below its 2000 highs. Thats citigroup which is about 90 below its 2007 highs and Goldman Sachs is the only one to have done that. I think Lloyd Blankfein has done a phenomenal job, and he will continue to do a phenomenal job. It is one quarter. It is a trading quarter. It is a tough market they are to be xhecommended for having this one quarter at this point in time a of a long, long history. The culture there is still the best on the street its ten years. Its not one quarter dick, look the a the chart. I looked at the chart i challenge you to give me any other bank in your universe that did what they did over the last ten years jpmorgan morgan, i agree those companies are not seeing their underlying Business Models fall apart. Those companies in the past if you will few years, not just you guys ought to fixate on one quarter fixate on the last few years were not fixating if anything, dick, it feels like youre fixating on a couple of quarters rather than a longer term story and looking at a stock price. Ten years of no earnings increase thats one quarter six years of not showing any revenue increases. Thats one quarter dick, gary cohn, the heir apparent is now with the regime. Who comes in here . Are you saying someone from outside or absolutely. Or is there someone within goldman . Someone you can go private and stop playing this game with public shareholders or bring someone in from the outside. As i was about to say, bny mellon has been successful now even though they have a very strong management core, they reached out and picked up Charlie Sharpe they recognize you need a constant reinvigoration of ideas, Goldman Sachs is an insular company. Everything is internal you cant get anything out of Goldman Sachs. Simple question was asked yesterday to Goldman Sachs, what is the Stock Buyback Program going to look like every other Financial Company has indicated what that is because its not a major issue were not going to tell you, is the answer were not going to tell you on basically anything its a private company that is paying its people well, that is showing no improvement over a tenyear period for earnings or revenues or any of the key metrics which would drive stock prices hold on if you guys disagree with this call from dick bove, you should also turn some of your ire on that side of the desk because jim labebenthal agrees. Let me explain it for fully this is a company that has a legacy of changing its culture right . Youve had Investment Bankers in charge through the 90s. Youve had dual heads with jon corzine, hank paulson, investment banker in the early 2000s. Now youve had a trader for the last ten years actually id like dicks response to this he was a trader let me finish, okay if you want to actually change this company and actually make it somewhat different, focus on the Investment Management division i was there 15 years ago, and i can tell you, you felt like a step child in that division. There needs to be leadership from that division to put them on par, in my opinion, with a Morgan Stanley, with a bank of america, with a merrill lynch, to put them on par with the traders and Investment Bankers i think the Investment Banking division is where the future of the industry is going to be. I said Investment Management. Maybe i twisted my words i mean the Investment Management division, which is smaller compared to Morgan Stanley by a lot yeah, it is obviously Morgan Stanley made a major, major play in that area the whole company took a bet on Investment Management, Wealth Management, and it is paying off in a major fashion but im a believer in Investment Banking. I think Investment Banking is where the future is for the Financial Services industry and i think the Investment Bankers should be running that company what id say to dick and to jim is that clearly, dick, your comments put a target on mr. Blankfeins back i think that there will be a target on the people who ran fixed income commodities trading, currencies, and all the rest at Goldman Sachs. I dont think this takes down lloyd. I think one of the people who are in charge of those divisions are worried right now after this report they were worried before report, and theyre worried now. Heres a point that we havent brought up, which is that Lloyd Blankfein and gary cohn are very close. If suddenly theres this move under foot to undermine Lloyd Blankfein, seems to me as a shareholders and director of the company, we should think is that better for shareholder if Lloyd Blankfein isnt there . Isnt it true in which the culture gary cohn was brought up was one in which we have an interest in the administration to preserve that and to enhance that i mean i would think that there is something that is not not in contrast to whats good for shareholders, but part of the same tune. Say this happened tomorrow. I think the market would be shocked and i do not think this is one of these situations where gs goes up on i think first of all, im going to disagree with you the culture has not changed at Goldman Sachs. The culture is one of the strongest on the street. I dont know where you get that. No, no, i totally disagree. Ill let you finish but i want to respond you can respond but i dont know how well you know the partners that have been at Goldman Sachs and there now. I know a lot of them very well the culture has not changed. Its not longterm greedy anymore. It just isnt. Its not longterm greedy. 15 years ago what Investment Management was doing is no relevance to what its doing today. You should be current on that. The other thing is jon corzine was before hank paulson and he was a trader gary cohn was a trader theres been Investment Bankers. Theres been changes in leadership over the years. Exactly right and the culture has stayed the same what dick bove is talking about is a company very dependent on trading revenues, and given what happened with the volcker rule, et cetera, they had to change their Business Model as a result, you dont have some of those blowout quarters in fixed income, commodities and currencies that you used to have Lloyd Blankfein is to be commended for changing, from morphing that company, as well as he did, without losing major profitability. There is a couple of points you are making there one is that there has been a structural and secular change in the trading of securities of every type, and anybody on that desk, as well as anybody in the business, is well aware of it. And therefore, Goldman Sachs should have changed with it. It didnt. Second thats not true but go ahead the term partners was just mentioned. Thats one of the key problems it is not a partnership. It is a shareholderowned company and the people who work for it are employees of the company and the shareholders they are not partners. They run it as if it is a partnerowned company. They run it as if it was a private organization it is not that it is a shareholderowned company. It has an obligation to increase its revenues, to increase its earnings it has an obligation to adjust to changes in the structure of the businesses which it services it is not doing any of the above. Whats more important to you . The share price . As an investor whats important to me is a share price i look at a company that over the last ten years has outperformed every other company except for jpmorgan. I would say it is a pretty damn good record. Its definitely outperformed the s p. Well, if you bought the stock when Lloyd Blankfein took over you didnt make any money. What have you bought the stock though in the aftermath of the crisis if you bought any of the financials right before the financial crisis the whole thing is you are picking the point in time you want to enter. The point is this company has not increased revenues or earnings for ten years and you are saying thats a wonderful record it is not a wonderful record are you rewarding bank of america for getting down to 3 you know where im going, right . There was a reason why Goldman Sachs didnt trade down to 3 a share. Right . Where were you then what was your recommendation on bank of america . Well, we were buying it oh. Dick, i appreciate your time. You knew the comments were going to draw some controversy it was a lot of fun it is good to talk to you today. Thank you dick bove you want to continue im going to elaborate the point and i will make it quick there is a difference i think youll probably agree with this in the nature of a relationship in Investment Banking versus trading if youre an investment banker, you are looking years and years to develop a relationship that if a transaction occurs, whether its capital raise, m a, whatever, you are the guy whose built that relationship over years. Trading is fundamentally different. Trading is today were doing a transaction today. Were not worried about next year that is fundamental lip, culturally different between those two divisions. I think it would be helpful that is so untrue. That is completely true we going to talk about a difference of opinions no. Were going to talk about facts. How much time have you spent on the investment side . Plenty. No. Working at an investment bank. Five years. Where goldman i was in private Wealth Management no. What is this . Ironsides here when youre at a trading desk and running a trading organization, and ive had trading desks report to me, okay, you align perfectly with the investment bank. You know why because nobody wants to take their Company Public or do secondary thats pret the chinese wall. Jim, where were you on august 9th. Thank you, colombo. Im pleading the fifth the bottom line is you can catch more of dick boves thoughts on Goldman Sachs at cnn n nbc news d cnbc. Com halftime. Ammeamon javers has more one senators going to meet the president. That is live, the senatorial buzz there, like the school bus you used to take to school but a lot bigger the president s been tweeting about this event today this is an event designed to all get together and discuss steps forward on health care we expect some tension in the room for this because the president has said hes frustrated with capitol hill because theyve talked about repealing and replacing obamacare for seven years. He says he is ready to sign a bill if they would only send it to him on capitol hill you hear some grumbling about the president having gone to watch a Golf Tournament over the weekend, having gone to watch the bastille day parades in paris instead of focusing on health care, trying to push it over the end line. The president tweeting this morning, i would be having lunch at the white house today with republican senators concerning health care. They must keep their promise to america. He also said, the republicans never discuss how good their Health Care Bill is, and it will get even better at lunch time. Dems scream debt as ocare dies. Richard burr is the republican chairman of the Senate Intelligence committee that committee is investigating the russia matter. He says it is simply not appropriate for him to be at the white house schmoozing or having any kind of events at all while he is investigating the conduct of some of the people who are here at the white house. Richard burr will not be here. John mccain, we do not expect will be here recovering from surgery over the weekend. But otherwise the majority of Senate Republicans have been invited and are expected to attend well see what happens and how much of that tension there is in the room and if they come up with any solutions and path forward for obamacare now that it appears their latest effort has fallen short eamon, well watch for more developments eamon javers on the north lawn of the white house for us, as usual. Heres what else is coming up on the Halftime Report announcer next up new insight on the next iphone will it be on time whats the cost . Will there be enough to meet demand and whats it all mean for the stock . Plus, battleground stock chipotle another slate of analysts disagreeinonhe ts ock g wrehist is going one upgrade and two downgrades today. Well debate it coming up on the Halftime Report. Were back on the Halftime Report. Chipotle still under pressure today from headlines that diners became ill at a virginia restaurant wall street remains divided on the stock. Three calls on battleground stock today. Bmo downgrades it to market perform. Wells cutting the stock to market perform weis, you sold your puts i did sell my puts. I bought them last week. Its been a great trade. Got very lucky even though some people who were hugging the porcelain god in virginia didnt get as lucky here is how i think about it it is still tremendously overvalued and thats what i couldnt come to grips with. So theyre not going to put the numbers into very competitive space, incredibly competitive. Theyre just not there so to pay 33 times earnings to get your 470 target is ludicrous. No Restaurant Company has ever held that multiple for as long as chipotle has held theirs. I had september puts i thought i did pretty well. Move on. I bought calls in there today. I thought it was overdone. I dont know whether or not i mean unless this spreads, judge of course, im hoping for their sake and the people that dine there that it doesnt spread but if this is for this one store in virginia, i think this is way overdone. Got down to 362 today rebounded about 10. I think dana telsey is right on. These two firms are literally making a call in large part on this report of these other customers being ill yesterday at one restaurant at one restaurant no. They make a call thats systematic, endemic of the company. Theyre using yesterdays story as an excuse to bring back up that issue. Yeah. Okay. Okay so two things. John is going to be right if he reacts quickly because this stock is now at 17 rsi this is as oversold as a stock can get on a 14 period there is going to be a vicious bounce you have to be selling that bounce with three hands, my friends. You have to. Because this is a name that really is lying down on a multiyear like a sixyear low. 360, 355 thats like do or die. If the buyers dont come in there, which is where they came in last summer and they came in today. Right so they came in today. I actually think that you probably have a lot of amateur shorts in this name that dont know what theyre doing. There might be a rip whats the yearly high on the stock . Year high 52week or the year yearly. Year to date close to 500 the alltime high, 750. Its 500, year to date high. Got up to 500 seemed like this thing was coming back. It rolled over before norovirus. It rolled over the first week of june, then it just kept going. Thats way before anything theyre talking about in virginia happened. Thats my point it seemed like it was coming back you see that peak there, then it comes down again then you have this news in virginia then the im with weis its not that theyre going to do queso and the salads. I root for the company just not at the stock price right now. 33 times when even the best names in this group are selling at 27 at the high end. Im story. I think the stocks got risk i think if you need to be an investor in here youre going to get lower. The stock got to be way too expensive before it had its collapse and it was very risky you have a few people get sick and of course it is going to get hurt the same would be true right now. As josh pointed out, it is an expensive stock. The growth is limited because of the competition. Huge competition in the space. And i would not be long term owner. Lets do our trader blitz now. United airlines moving lower this hour despite meeting on the top and bottom lines the forecast wasnt particularly optimistic relative to what expectations were. Think they are still suffering from the Public Relations theyve had. But look, i like the airlines. I like this airline. I still think it is a great group. Im still in american and delta. Im staying there. Ibm 21 quarters in a row . I think it is 21 quarters in a row of declining revenues. This is a value trap, folks. Youre going to get tempted to go in there for the right reasons because technology i got out of it two years ago. Look, youre going to be tempted to get into this because of the great ai story and the data, the cloud and all that sort of stuff. Underlying business of services is going down. Theyre not getting bookings the way they should. This is a value trap just stay away, folks. Csx they beat the street is punishing the stock somewhat this stock looked flawless going into todays earnings. Is that why it is down . I dont know. Right for a sell . The up trend is still intact. The stock did find support in that rise in 100 day if you look at the last three years performance, this thing deserves the benefit of the doubt. It has resumed the prior up trend before id be watching this one with a very tight leash trip advisor got upgraded today over at cowen. We talked about it yesterday. Frequently you see unusual activity ahead of a big upgrade. Cowen gives them an upgrade today. Takes them to i believe market pomp, perhaps even outperform. The options are certainly outperforming. It is a good day here. Paypal. We own it its been a great stock. It is one of the few really dynamic marketplaces payment transactions, theyre on everybodys platform everybody wants to partner with paypal theyre growing, particularly with millennials we like this and we think they compete very well against other financial and tech players. Sue herera has the latest headlines. At this hour, everyone, a spokesman for german chancellor Angela Merkel defending president trumps undisclosed meetings with russian president Vladimir Putin at the g20 summit dinner he said the chancellor was not surprised or confused by the meeting because the dinner was an opportunity for multiple informal contacts and talks. Queen elizabeth and Prince Philip visiting canada house in london to mark 150 years since the formation of the canadian confederation. They were given a red carpet greeting by canadas governor general and his wife apple has filed a patent for a more secretive way to dial 911. Using Fingerprint Technology according to the patent, many smartphones offer a way to Call Emergency Services without unlocking the phone, but they can easily be noticed. Today is National Hot Dog day declared each year by the National Hot Dog and sausage council. Some chains will offer special deals on franks today and some through the month because july is National Hot Dog month. And thats the news update at this hour back over to you whats coming up on power lunch im going to tell you whats coming up on power lunch. Coming up on power lunch, the president meeting with gop senators right now after blasting them on twitter the details and a look at what could be next. Civil disobedience thats what the gop in washington is calling for in seattle over taxes but it is not what you might think. Well explain. And man versus machine meet the surgeon who is pioneering the use of robots in the operating room working on knees, most especially there that much that and much more on power. Scott, back to you jon is tracking unusual activity in a food stock we will tell you what it is and what the trade is next plus, details from jpmorgans tech analysts on what to expect from the new iphone. Halftime report back in two minutes. We created the ripple the doughnut in a doughnut in a doughnut. Right away, it was a success. I mean, it really took off. What people dont know is that it all started with points from my chase ink card. I bought the ingredients, utensils, even custom donut cutters. Wow all with 80,000 points. What will you create with your points . Learn more about the ink business preferred card. If you could book a flight, then add a hotel, or car, or activity in one place and save, where would you go . Expedia. Were back on the Halftime Report. Jon najarian is now at the tell straighter to help us with whats going on in the markets pinnacle. A lot of rumors southwesterlying again. You might recall end of may, beginning of june there were rumors of an approach by conagra. Our david faber did ecried that. The stocks starting up again. They are beating that somebody could be talking to these guys maybe it is conagra. Maybe it is somebody else. Or maybe the stocks going to have good earnings take a look at conagra calls they were buying december 65 calls. What did i do . I bought the calls ill probably be in there anywhere from ten days to a month. Pinnacle has no comment on these rumors and reports you got an update on vips . Yes nice one yesterday pete talked about vips stock gets in here, pops all the way to 1,245 this morning right there. Heres where it was when pete was talking about it yesterday so very nice move already. These calls, more than tripled they went from 27 cents to 90 cents already. I guess hes taken off half. Im out. No position here right now come on back over here. Up next, the apple trade details on the next iphone jpmorgans rod hall is with us back right after this. Nge, and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. But we should be seeing more range of motion. K good, im fine. Okay, well lets see you get up from the couch. Im sorry, what . Grandpa come. At cognizant, were uniting doctors, insurers and patients on a collaborative care platform, making it easier to do whats best for everyones health, every step of the way. You may need more physical therapy. Ugh. Am i covered for that . Yep. Look. Grandpa catch grandpa duck woah ha there you go grandpa. Keep doing that. Get ready, because were helping leading Companies Lead with digital. I am a First Responder tor and iemergencies 24 hours a day, everyday of the year. My children and my family are on my mind when im working all the time. My neighbors are here, my friends and family live here, so its important for me to respond as quickly as possible and get the power back on. Its an amazing feeling turning those lights back on. Be informed about outages in your area. Sign up for outage alerts at pge. Com outagealerts. Together, were building a better california. All right. Check this out top of the third last night. Mets cards guess who catches the foul ball . A souvenir for Chris Christie are you kidding me how about that . You just noticed him boy, are you hot what do you know he gets a ball lefthanded catch. He did give the ball away mets lost. Did they give it back to him . No. Sometimes they make him throw it back on the field. No. I understand that. He autographed it he did get booed. Yeah. He did get heckled a bit by the announcer as well. Im surprised he didnt close down that whole section to attend the game. There was a beach comment by the announcers on fox sports midwest. Presumably the cardinals announcer poking a little fun at the new jersey governor. For reasons we all know. Yes yes shifting gears to retail lululemon with a buy, ralph lauren with a hold nike with a hold tiffany with a hold. I guess you got the picture. Everybody has a hold except for lulu hold is a sell. A buy is a hold. Unless it is an initiation, right . Because it gives them room a month from now saying, weve seen the light were going to upgrade can you imagine seriously investing in seriously who cares about the holds . Thats not the interesting part. It is the lulu love. Is that the bright spot that we should be focused on is. Its one of the few names thats actually moved higher lulu had that big decline and they seem to have gotten their act together somewhat. Stock bottomed and its been coming back. That doesnt mean that theyre in the clear or that things are all better for them. I would sell right here it just failed so to kerrys point, it just filled a gap from the last time they wrecked everyones dreams. If it doesnt get much beyond here and you start to see strength petering out, start to see volume tail off, this thing will roll right back over again. Ive never seen a sloppier chart. I have no idea what this stock trades on. It is an incredibly strong brand. Great brand identity is it amazon proof . I think to a certain extent it is. Absolutely absolutely but it does rely on like it does need mall traffic. Diminishing traffic at the mall i think it is something you look, i sat here two years ago, said why would anybody spend that on that type clothing now it is all i wear but thats when athleisure was sort of moving up to its peaked now its going down. Not in my opinion weve been talking about the negleative side of the stocks getting destroyed. You are looking at ones who might benefit because of amazon . Heres the way we think about it there is this Amazon Effect and it reminds us of ebola or china collapsing where every time theres come on no. An iota of a thought that amazon might enter a market, the stock craters. This frenzy and panic, we got to get out before amazon gets in. That really cant apply to every single sector and every company in the world so what do you buy . We havent bought anything yet. Though you guys know that we did buy Sherwin Williams and made that comment that paint cant fly. So thats a business that can do just fine without worrying about amazon because theyre not in the paint business and there are other businesses right now were looking at hanes brands we are looking at auto parts companies. We agree. Auto zone. You have to take into consideration the price. Theyre ten times earnings i get it you can buy things online. Just like a slight nuance to that, we use Amazon Effect as a shorthand because everyone understands what we are talking about because everyone is disruptable. So you bring up Something Like a hanes brands here is a company that for like five decades benefited from, a, strong relationships with retailers, b, great shelf space. They can get into every store ubiquity, everyone knew the brands now a company like matt weldon comes along. Theyre only selling on instagram. The only place they are doing their marketing. They can take share. Look what Dollar Shave Club was able to do to the big razor companies. It is so much easier in this day and age, to come out with a brand, make a huge splash without the type of money you had to historically, and be a real threat. Its not just amazon it is ecommerce and it is distribution on social platforms. I cant tell you every category you can think of absolutely can be disrupted and it doesnt have to just be by amazon prime i dont think thats the only issue. I think the other issue consumer spending, studies show, have gone more towards experiences and away from consumption. So you have that double whammy as well. Well give you our top picks in the tech space coming up. And futures picks, oil is on the move today halftime is back in two. Think again. This is the new new york. We are building new airports all across the state. New roads and bridges. New mass transit. New business friendly environment. New lower taxes. And new University Partnerships to grow the businesses of tomorrow today. Learn more at esd. Ny. Gov if you could book a flight, then add a hotel, or car, or activity in one place and save, where would you go . Expedia. We, the people, are tired of being surprised with extra monthly fees. We want hd. And every box and dvr. All included. Because we dont like surprises. Yeah. Like changing up the celebrity at the end to someone more handsome. And talented. Really. And british. Switch from cable to directv. Get 4 rooms with hd, dvr, and every box included for 25 a month. Welcome back to the Halftime Report. Im jackie diangeles with the futures now traders. We are watching crude oil rise today for the seventh session in eight. Todays gains coming on the back of new data that expects a large draw in u. S. Inventory what else is driving this price higher today, jeff kilgore in 2017 focusing on the supply but i think today the u. S. Dollar drubbing. That is front and center stage right now. This u. S. Dollar has bolstered everything stocks, bonds, commodities, specifically crude oil. I do think this rally, this impressive sevenday rally is going to come to an end due to the fact that the bulls have not been able to get over this 47. 50 level when the dollar is in the 94s and crude oil is not above 48, safe to say it is starting to fizzle break down wti if you look at a chart you can see were bumping up against resistance thats defined by a series of lower highs. It is not surprising we are having a little bit of trouble getting mentioned. Im looking at 47. 40 were less than 1 away. That makes a lot of sense because we found out earlier today that the saudis exported to the United States last week Less Crude Oil than they had at any week in the past seven years. We would, pe expect supplies toe decreasing. All right, guys catch the live show at 1 00 p. M. Eastern tomorrow on futuresn futuresnow. Cnbc. Com. Vertex is at an alltime high for more than three years. Carrie well, vertex hit it out of the park today here. Theyve shown great results. People need it cyst Cystic Fibrosis is an expensive disease. Most companies dont make any money. They dont have products on the market and it gives life to the sector we own bristolmyers its in the space and we own a smaller one, ultragenics ibb, xbi, both having great years. Yes biotech is having a great year. Just health care in general, ripping. A lot of this has to do with people making asset allocations decisions based ohhn what they think the picture is they look at what are the type of stocks that are secular growers and, of course, tech and buying these etfs, youre driving up the whole sector. Good and bad biotech alike and then separate themselves based on phase 2 and 3 data. I think thats the story going on here. Im long amgen, is my pick in the space. Coming up, aui bak qckre, well do final trades. Im here at the Td Ameritrade trader offices. Steve, other than making me move stuff, 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. See options data like never before. With thinkorswim only at Td Ameritrade. To keep our community safe. Before you do any project big or small, pg e will come out and mark your gas and electric lines so you dont hit them when you dig. Call 811 before you dig, and make sure that you and your neighbors are safe. 811 is available to any business our or homeownerfe. To make sure that you identify where your utilities are if you are gonna do any kind of excavation no matter how small or large before you dig, call 811. Keep yourself safe. Welcome back there is apple today, 152. 92. Rod hall released a new note today about the new iphone saying it will arrive on time but supplies will be limited hes also talking about possible pricing. Rod is with us live from san francisco. Welcome back. Thanks. Good to be here. Big takeaway that i got, this thing is going to be more expensive and initially there will be fewer of them. Is that right . We think production in september is going to be really limited, if much at all. We think 2 to 3 million output from the contract manufacturers and most of the production is in october and dont hit peak volumes until november we dont think apple is changing anything right now we suspect they set these production targets back in the spring. Is it in the stock or not i think a lot of this is in the stock. We think the stock is very attractive at these prices headed into the back end of summer when you can anticipate a really strong cycle on the iphone and in the fall this year. Its obviously had a great year to date youve taken down your fiscal year q4. Youve taken them down substantially from 49. 5 million to 42. Yeah, we moved 7 million out of december into the december and march quarters we havent reduced our numbers for fiscal year 18, weve taken that volume that we dont think gets produced in december and moved it to fiscal year 18. You say it could be 1100 bucks, weve heard reports as much as 1 2. At some point can they price out some consumers that they need . Yeah. Its hard to know. Apples never seen that much price elasticity on the iphone nobody knows what price they will set on this target but it is going to be a highend product and have new technology in it and we think that they will price it fairly but aggressively, given all that well see. I would argue that they havent seen a lot of price elasticity up to this point so they probably dont lose a lot of people at that higher price point. You can spread that over a lot of payments a he do an installment with apple or one of the carriers and spread the payments out. Is there a number that makes you raise your eyebrows and say, hmm, maybe thats pushing the limit . 1,000, 1100 is already pushing the limit for cell phones i hear you on that. You get up to 14, 1500 i dont think thats possible. I think its likely to be 1100, 1200. Thats a fair point. This is jim it seems to be moving to the right. If it moves any further, its going to crimp in on the holiday selling season people may say to heck with it, im going to get a galaxy or Something Else do you worry that this thing continues to move to the right and by this thing i mean the launch move sales not just into 2018 but lose them to competition during the holiday selling season thats a fair question, jim i dont really think so. Theres been a lot of buildup to this phone and a lot of anticipation out there i dont think people who have their eye on that phone are going to settle for a galaxy or another product. I think they will wait until supply becomes available get your orders in early. Rod, thanks so much. Appreciate the time today. Good talking to you guys. Jpmorgan. Im going to get the rose gold one. You might i dont know. Glossy black for judge. Im going to get two so the first one doesnt get lonely. What about the stock, 150 bucks . Im in, man look, i totally respect the point hes making. I dont think its going the change the fact that this is the jesus phone. Everyone is going to want it thats it. You know, this is typical apple. They say that supply is constrained. You hear all of the headlines. And sign up early. You see josh and all of his friends. I thought you put all of the supply out there and the demand follows. Thats not how economic works . No. It used to. Right right. Different this time. Thats how somebody thought it work. Mnuchin said that no. 101 i think its good i think youve seen demand in the stock for the new phone. Lets hope its new technology i own the stock. If it dips, ill buy more. Final trades. We have 20 seconds left. Apple lets move on. Facebook. I bought calls today nice. First republic, great bank, good niche. Llb incana. That does it for us power starts now. Im melissa lee so long summer recess. The president turning up the heat on senators right now in a lunch meeting with them. The details straight ahead higher highs, nasdaq and dow setting new records. Plus, man versus Machine Health care. The surgeon who is using robots in the operating room. Power lunch starts right now