Brendan spend the weekend in l. A. Becoming that about my body feeling bad about my body. I have no secrets. At this point i am just smug about how out of shape i am. Rex we will talk about joining across the gym later and how it did not work. Cheers are soaring after ceo apparently convinced wall street as found a way to Grow Customer base and add advertisement revenue. I am a twitter consumer and user as well. Do not know if it is the ceo convincing people. You have people who price place mars smartly priced Stock Options. Former Goldman Sachs banker and internet analyst back in the bubbly days of yore, hocker of things like webby and, now cfo of twitter in managed to price the Stock Options before the quarter reported. He has seen the quarter of the benefit of the quarter. A lot of really positive net gains. Really hard to find anything. Not only was it not better but better than the last quarter. You can see a turnaround in user growth. User growth growing at a faster pace. Wasnt that tied to the world cup . The previous quarter you saw an acceleration. You saw a lot of other number so the user growth rate is what i am talking about. 2. 3 . So the curve is showing an increase. Go t are they doing cap it is unclear. A lot of its international growth. It is what is going on in terms of revenue per year he per user. They are finding way to get avatars revenue to pay more. A twitter value of user has increased. ,ook at the revenue per user per 1000 page views, a year ago 20 . Are not talking alltime highs. Getting back to where we were in april. The stock is doing better. A stocknot look at trading 20 times sales and say that is a great investment. I am not an investor, i am a business analyst. I look at the business and see how it is doing. The internal question is it is about form. They go there and spend advertisement dollars. I think it is a little bit of both. Market makers is fine. It is no bloomberg west. We have no more time for this segment. You see the way twitter is being used. Many are making this out of fear. A defensive move of saying i guess i have to get on that twitter but they cannot quantify the results. Theyother program said were not advertising on twitter because they were not getting results. It now in getting great results. Changed in the way twitter works. When advertisers are spending money, they are not doing it out of fear. They have lots of choices out there. Compare it to facebook. A pimple in the tush. We do not talk that way here on Market Makers. Massive, profitable Free Cash Flow freaking machine and turning the firewall and everyg more profitable day. They are getting acquisitions because they know people move on over time. One of the most amazing turns in American Business i have ever is this adoption of mobile. They have completely changed the business. Twitter was born on mobile. Moster adopted it to where of the revenue comes from opal and generating more revenue than ever before. It is probably focused on health care and medicaid. I would like you to stick around as a consumer if nothing else. We need to turn our attention from tech to help care. Big Insurance Companies are reporting this week. Aetna, humana. Near year two of the obamacare insurance exchanges, i want to bring in jeff jonas, per folio manager at the firm helped and Wellness Trust fund and Shannon Pettypiece who covers the industry. Lets start with you. Carried there is strong results but expectations were high going in so investors are focusing a little bit on the negative and they have been selling off a little bit yesterday and today. Because they have the new customers. What happens if they are sick and need lots of services . It is still early on. Right now it looks like they priced the products correctly. They do expect them to be older and sicker. I think they have accounted for that correctly. So far seems to be going well. Aspects, one two is getting people into the system. That is great for insurers. The other part was slowly trying experiments to control cost over time. Any sense now for how successful they have been . Costs have slowed. More financial crisis. It is already a little bit inflationary because relatively generous benefits and low copays for preventative medicine and things like that. Does that change the forward look. Does that mean they will not grow at the pace they have been growing . That is a concern, but the whole Health Care Sector will be slowing down. We also want to control costs. But, if we as a nation are going to start granting back on health care costs, that has been a big driver of the economy. Health care has been job growth and job creation. If we are cutting medicare payments and payments to doctors, hospitals will have to cut staff. That is a real concern. What were waiting for. Premiums are next year. There are a whole different variety of indications. If the population who signed up for obamacare turns out to be a lot sicker and expected, and the early indications are theyre not that bad, but it costs are going up because of the economy or because we have a lot of sick people, that will be passed onto the consumer. Will be passed onto all of us. We know hospitals are consolidating. From the insurers perspective, . Are we this drive cost worried about monopolization within local hospitals driving that up . Definitely concerned about that. We see it in some cities like massachusetts where highprofile hospitals are expensive. We are hoping to coordinate care that the Large Organizations will communicate with each other. The different doctors will really Work Together to keep the patients healthier in control cost that way. The biggest concern by insurers is one of the biggest concerns is drug prices number one. Two, hospital consolidation. California, pennsylvania where you will have a onestop shop in town and that one town hospital will control everything. I think it is interesting insurers are driving transparency. We have the lobby working toward transparency. Humana doing this right. They are. For years insurers have been blamed for the cost but they are now trying to drive the cost control. Maybe even more so than the government. Because the less to spend on health care the bigger the profit for insurers. When you go to the doctor, that cost the insurer money. You pay the 300 per month premium you do not go to the doctor, that is all profit. They want to keep costs down, particularly drug prices going up and up. Until they deny your claim. Is there a sense they are happy with obama caret . They got what they wanted. A have been very responsive they have lobbied a lot. I think the administration has been relatively responsive to what they need. That is actually a criticism. That reason barring obamacare subsidies. I think it is very unlikely. First of all, going to the full appeals court, and then it would potentially be heard by the supreme court. We really will not know for two more years. I think the expectation is that it probably gets appealed. In the meantime, more uncertainty and that means more risk. A lot of people i have talked to said unlikely that will stand. Now you have the possibility out there you are gone to lose the new customers. If it did stand, with the exchanges collapsed . I think it would create a lot of uncertainty. We are not looking at a closed system. There is no pressure on the state there is now pressure to start accepting medicaid subsidies in building their own markets because they see how they are working in kentucky. Next two years is not a vacuum. There will be political pressure at the state level to make the subsidy problem irrelevant. You can sell someone the insurance that was once 300 is now 800 dollars. Im not a political analyst. When you look, who is your favorite . Ballpoints and United Health. What about the other two . Humana is riskier because almost all tied to the government. We have a small position in humana but it is riskier. Wellpoint and United Health care. Number one and number two. Shannon pettypiece in jeff jonas of cavalli funds. Because medicaid is on his mind. Stick around. Coming up, argentina on the brink. The company about to default country about to default for the second time in 13 years. Slamdunk butte a Microsoft Microsoft former ceo may be the new owner of the l. A. Clippers by next month. We are digital. See our stories an interview at tvomberg. Com and bloomberg plus and tablet. We are streaming on apple tv and amazon fire. Could officially default on the debt by the end of the day as negotiations continue with creditors owed 1. 5 billion on that aiding back to 2001. A federal judge will not let argentina pay other bondholders their Interest Payments unless they also pay out creditors. That would trigger a default as early as 5 00 eastern time today. Newsing in the bloomberg reporter covering this story. Clearly this is on everyones mind. What do you think . Do not really know. There have been a lot of the turn of events. There have been several meetings between argentine officials and Court Appointed mediator in new york over the past couple of weeks. Yesterday at the final hour the economy minister showed up. 12 hours of talks and people are feeling very optimistic. The federal judge in new york is because that is where the bombs were initially issued . Does argentina have the option of defaulting on just this debt . Because there is cross default. It would not be defaulting on local law bonds that are separate, not from the restructuring. It would be across the default. Not just the 539 million Coupon Payment lost. Toinvestors choose accelerate, youre talking about 30 billion dollars. Investors have a choice. What has been argentinas rationale of not wanting to pay . Seems like theyre saying i do not want to pay the sophisticated investors. For a long time the rhetoric was were never going to pay these guys, they are trying to cheat us and our vaulters and they wanted better deal than anybody else. That was the rhetoric for a long time. It was like posturing. Recently it turned into something more complicated. You have sympathy for the double. Hate the game, not the player. Whether we are talking about holsinger, kyle bass or any other hedge fund manager, theyre living within the confines of the rule. If the government does not like the rule, change them. The player is the game. You cannot write a law, a bond structure that will prevent someone like paul singer from deciding he does not feel like accepting a default. There is a moral hazard on the part of the creditor, too. We have a money with hot money flowing into money around the world, going into sovereign bonds. If people do not feel like they have to be careful, then they will not because they can always haul it back out. Paul singer took a risk investing in the bonds. You can write a contract to be what you want it to be. Since 1964. D they do not really exist anymore. That is the argument from moodys and other experts that say this is a really particular situation. Have the particularities of the attitude of argentina. Very specific to the argentine government. The fact that they have restructured twice and refuse to improve the deal and the fact that they put the obstacles in the restructuring that would prevent people from being able to get a better deal, there is a thing called the lock law, which if you do not going to restructuring right now, you will never get paid. A problem, argentina is not the most sympathetic. Precisely. Ims, multilateral organizations or countries that have come to the defense of argentina, they have all been like we have a problem with the ruling that argentina is not the most sympathetic. Lex so what happens if they default . What happens if they default . Almost no one knows how the mechanics will work at this point because there is a possibility the deadline comes and goes but argentina figures out a settlement in like 48 hours. Trigger or notl trigger. In terms of how long for argentina to come to a settlement and figure it out, that is a telltale sign or how deep the effect of the economy will be. My question to you, do you feel like this is why Credit Derivatives give the name weapons of mass destruction. You feel that is not real investing . Real investing or not real investing, i just want the people making the investing to feel the sting of the risk. The german banks heavily invested were bailed out by the irish taxpayers. German savers do not feel any obligation whatsoever to accept the loss, given they just think money in spain and greece. That is not a guarantee you will get bailed out. Exactly. Theres a difference in the structure of a bond contract and hauling any out when things go bad. Are in have bonds that various jurisdictions. Again bonds technically would be in default within an hour. When argentina needed money and they issued debt, they did a road show. They went to see investors around the world. 1999. Who cares ago what does it matter it was in 1999 . Argentina got themselves into the situation. They did a roadshow and put themselves out there. Qualified institutional buyers. Not to my granny. There are a lot of grannies who got the debt. Not just holdouts. Grannies and italians. Italian grannies. No cost of for you, Stephanie Ruhle. You are going to work overtime. Giving us the latest on argentina. She will be with us throughout the day. Up, the Federal Reserve has been cutting back on stimulus. We will find out in a few hours if another one is in stores. Coming up, waiting on the fed. We will see if the fed cuts back on the bond buying once again. He has made a fortune on hiphop and fashion. Now branching out to another form of art. Stay with us. Welcome back. We have breaking news. Snapchat, one of your favorite apps, they are said to be in funding talks with alibaba and valuing the company at 10 billion. Extraordinary. A ceo under the age of 27. You take pictures with the sole purpose to delete them within the next 10 seconds. They have 30 employees. Market cap would shoot through the roof of anything we have seen so far. Beeep thinking this has to it. Then it is not. 10 billion from alibaba. We are in a revolutionary time. We have not seen disruption like this. Does it take you back to 1999 . I feel like it was an interesting idea about making communications disappear instantly. Facebook has gotten slightly more snapchat. Innovation, not a platform and innovations can be stolen. We will cover this throughout the day. We have just seen this headline cross. Alibaba come a we know they are not shy when it comes to things may have interest in. Betterthanexpected news on the economy. Second quarter gdp rose at an annual rate of four percent. The government revised the firstquarter figure saying he was not as bad as the first estimate. All this coming a few hours before we hear from Federal Reserve policy makers. With us to break this down, michael mckee. The global head of fixed income strategy at jpmorgan, magma claim made mcclellan. Meg. We did have a great quarter. Looked really good. Another thing we watched is the inflationthe fed measure. We will knock at the excitement of a press conference. Or the dot plot. Where the fed tells us where they think the Economic Indicators are going and where the rate hikes will be. We will watch that statement very closely. In the statement we are looking for things like recognition of better economic growth. Maybe a comment on inflation. Also, maybe a reference to housing. Housing was weaker than expected. Theyow part of the reason keep the number down is to keep the housing sector going. . Remember George H Bush i will respond by saying not going to do it. They will not say anything they have not said before. Aybe get an edge description of housing slightly weaker. Go on trading however you will trade. August 20 well we will get the new minute. We will talk about the exit strategy and perhaps the timing. It really will not say anything today. If they do, a big mistake. Feels frustrating we have done this much time focusing on what the fed says because i think it is an indicator that the only thing happening is monetary policy. There is no fiscal policy. What the wayactly we feel as investors. Frustrating to not look at market fundamentals and have the anchor of expectations for 10 year yield. Instead, technical. Of foreignlot Central Bank Buying in the u. S. Market. With not going to be prudent. I love that skit. I think one thing we could see today is fisher dissenting. He has been very vocal. That is something i think he might do. They are on track at this point. Pay for another 10 billion to be done in october. We have known how we felt about this for a while. He has been pretty clear. Are you worried about a depression and longterm growth . Attribute it to this. A lower participation rate. Is this something that keeps you awake at night . Not necessarily keeps me awake at night. To go down. Ends we have been through the Industrial Revolution and big urbanization of population that happens. Massive growth spurts. Tech a logical innovation. Maybe not snapchat in this case. It will drive productivity and growth but nothing like the time of industrializations. That is natural for a developed economy. Snapchathat not good news for the economy. How many kids worked their . 30. Like comedy work at gm or ford . You look at the s p 500 and if you rank them by number of employees, 180 nine or Something Like that is facebook. Everyone else has hundreds of thousands. If this is the future, it will leave a lot of people on the sidelines. I have to think this ends in tears for snapchat. B b and uber, air these are real people investing. Now we are living in a virtual society. You do not necessarily need to have something you touch and feel. Words a lot of people five years ago saying what do people use Facebook Ford . I can still devote a lot of time to stalking ex boyfriends. You may want to put money into snapchat. I think it is insane to say we world. A virtual i ride a real train. I think it is exciting that we have valuations for airbnb. An actual dooren and go into an actual house. I agree with that. A much morer has significant role in my life and