After the bell. Well tell you what to expect and live analysis when the earnings are released. Meantime, the Republican NationalConvention Officially under way in cleveland right now. We are live on the ground there with the latest developments. Plus, mr. Trump senior trade adviser on why he believes free trade failed the United States. Remember this one . We have new developments in the story about a Hedge Fund Portfolio manager fired after throwing a big hamptons party. The Hedge Fund Manager is speaking out saying theres a lot more to the story and hell tell us what it is after the bell today. All right. Japans softbank buying uk based apple supplier arm holdings. David farber, david, has the story for us right now. I do. Thats right. Arm. I want to hear about the Hedge Fund Guy and ill wait for that. But as for this deal, of course, many people actually not expected it. They werent waiting for a deal of this type. Arm holdings, bill and kelly, not necessarily thought of as a consolidation play and not for softbank. Talking about the name you might have expected. Perhaps the Main Customer or intel. Apple being the Main Customer or samsung or qualcomm. Softbank, well, that was probably something that people had not thought about and the man who founded softbank and runs it as the ceo has been thinking about it. In fact, for quite sometime. At least for the last few months. And only recently approached the company with the deal they simply couldnt refuse. A 43 premium to the stock price just on friday and the multiples are staggering. 33. 6 times the companys ebitda. 20 times the revenues. Over 60 times earnings. You get the picture here. He was willing to pay a very big price. Arm holdings, of course, becomes softbanks and very quickly because the deal, again, not strategic in nature, not putting together two players, this deal could close before labor day and theyre saying by the end of the third quarter. Which point softbank will own this large asset in addition, of course, to the still very large position in ally bah bah and to the 80 plus ownership it has in sprint. Not quite as good an investment. Masayoshi son said this is the next big bet, a bet on the internet of things. Here he is on a Conference Call of earlier this morning. I said, biggest paradigm shift thats coming is the internet is going to get connected. Not just pc. Not just mobile. But everything else. Everything else will be interconnected. So that is internet of things. In todays terminology. Today, ten divides per population having internet of things. But in 30 years from now, 1,000 devices per population is going to get all connected. Were going to all be connected and everything we own and rely on will be connected to the internet. Of course, he expects they will be using the intellectual properties of chips of Arms Holdings and annuity he sees paying off over a long period and somebody who talks about 500year periods. You know, he is not just talking about today. And hes willing to make huge bets with his own capital here. 32 billion, of course. Not expected anyone to come in and play here given the multiples we talked about. Though you never know. But they can close the deal very quickly, too. Which is also an advantage. David, when his deputy left, i thought one of his criticisms if you want to call it that was softbank was too quick to acquire stakes in companies we not exit them or do something with them and kind of surprising, you know, he leaves and this is the first move that softbank makes. Yeah. It is interesting to note after the departure. This is an enormous deal. This is right up there with the purchase of the Wireless Company in japan from vodafone and the stake in sprint and, of course, the alababi investment of years ago. Youre right. That said, they did sell a good amount of that stock a few weeks back. Roughly 10 billion and monetized their investment in supercell and they had been doing selling in part to help them do some big buying. Do you think this wouldnt have happened this quickly if the brexit vote hadnt happened and the impact on the value of the british pound . Went down appreciably. Do you think theres other deals as a result now for uk companies . Great question. In speaking to people who were familiar with this process, they tell me masa son was planning this for quite sometime and doesnt hurt you buy it when the currency is far weaker. That said, the company itself reports 95 of the sales are in dollars so youre not going to be benefiting on that currency translation if youre masayoshi son. Just quickly, sprint is the biggest problem for this company. Why not fix it . Well, you know they wanted to combine with tmobile and got the thumbs down from the government. Before they even really tried in a significant way. They knew it wasnt going to happen. This deal is actually being taken as a sign that theyre done investing in sprint. Theyre not going to put more money in on the Conference Call this morning. Masa son seemed to say that sprint is self sufficient giving me room to consider what is his next big move which, of course, is arm holdings and the internet of things. Yeah. Sprint down 6 today. Theyre on their own i guess. David, thank you very much. Watching for that Hedge Fund Guy. Great story, as a matter of fact. Yeah. Heck of a party. Lets get to the Closing Bell Exchange for a monday. Keith bliss at post 9. Heather hughes checks in from d. C. And contributor jack bah rougian is in chicago. Whats the next catalyst for the market sitting here and virtually in record territory . Up or downside . Next catalyst is fairly soon now that the tech earnings rolling out this week and then roll into the industrials. And hers wries the catalyst. Earnings reports tell us that the companies are feeling good about the longer term and the future, and that the Second Quarter marks a trough in the earnings, what a lot of people suspect, then i think you see the investors and traders be willing to take on additional multiple expansions right here, right now and earnings to catch up with them in future quarters and really critical what we hear from the Companies Like netflix, like ibm and microsoft tomorrow and then later on in the week and then getting into the industrial Companies Like ge and the like next week. Those are the critical things and will be the catalyst to push it forward. We have seen momentum built into the market. Internals suggesting that investors expect that. Keep your eyes and ears open for later this week. Heather, are you guys focused on earnings here . Yeah. I think it is important to look at earnings. We have news out of the big banks for the most part looks very promising and we need to hang our hat on the consumer and in terms of confidence and catalyst and propel the markets higher. What concerns me is utilities and telecoms led us to new highs and defensive sector and gold climb on the backs of this. Walls of worry and global instability w. The 10year this low, theres the anomalies that 10year setting record lows and the stock market setting record highs and one of the two to be reconciled. Jack, you late last year famously telling us and correctly so to watch for problems for the u. S. Equity market. We had that early in the year and now we find ourselves at alltime highs. Where do you stand right now . The problems behind us or more volatility to come, do you think . Bill, this is still the year of living dangerously for the market. You know, thats the line i have been using and telling customers that and investors that. Remember, and keith was right about something. You know, we are looking at multiple expansion. The reality is that math is math. What multiple to attach to the market right now, especially in the wake of the low Interest Rate environment. The question is in earnings and the fact we have been seeing a deceleration in earnings over the course of the last few quarters. We have been seeing contraction with what these companies are making. Last week, you know, everybodys talking about how to see inflation come out and we saw inflation come up. Producer prices are going up faster to Consumer Prices and says that operating margins to contract and could be hurtful for the market down the road. Do i think were in the clear yet . No. If anything, what heather said is right. This market has been led by defensive sectors and this low rate in the bonds telling us theres still a red flag of warning out there. Bill, we have had five consecutive quarters of revenue decline and concerning and i get it. Its the tina trade. No alternative, right . Looking at bonds where they are, 1. 58 on the 10year today, didnt budge much with the global instability, people are flocking to the u. S. Stock market as a safe haven perhaps. Theres a feeling. People are in the aggregate and overgeneralizing and understandably so and people generally investing for yield, not for growth. And theres a fear out there that thats going to bite those investors some point. Do you share that . Yes. Look at the spreads on the highest yielding and lowest yielding sectors in the s p 500. Its about 2. 6 . What does that mean . Yield compression. Thats tight spreads. Investors are chasing yield. I get it. Bidding up asset prices and pulling yield down. When stocks get treated like bonds, there is a structural flaw in the market and it is something that we have to be absolutely concerned with and thats whats happening right now. There has been but, you know, when does it stop . No one has a crystal ball to predict that. Does it pay for the investor to stay out of the market in the meantime . Last word to you, keith, quickly. If we were to take subsets of the market this year and the market leaders, it is utilities, defensive names. But from february 11th and you look for june 27th, two low points and ebbed in the market and then the growth sectors and names, they have led us out of the troughs and thats whats important to remember is that investors are now looking at those growth names, wrongly so it may be and not concerned about yield right now and looking forward to growth by the calculus that we have. Thanks, folks. Appreciate your thoughts today. Thank you so much. Lets get now to the Republican National convention in cleveland and security is ramping up. We have more out of cleveland right now. Ayman . Reporter were here on Lakeside Drive in cleveland just outside the security perimeter and you can see some of the heavy Police Presence here in cleveland. A couple of numbers through the scale of this operation here to secure this Republican Convention this year. They have booked about 5,500 total officers to secure the rnc this week. They say they have purchased 10,000 extra sets of handcuffs and they have also cleared 1,000 beds in local jails for any protesters that they happen to arrest in the course of the week w. The political tensions seen in the country over the past several months and the shootings over the past week and a half or so, around the country, tensions are very, very high here. Let me show you some pictures now that we have taken just a couple of minutes ago. These are pictures of a protest thats happening just a couple of blocks away from where we are outside the q and what were told about these protest pictures is looking here at antitrump protesters running into protesters who are against the black lives matter movement. Police appear to be maneuvering in between the two groups of protesters who are shouting taunts back and forth at each other. Police trying to keep them separate so that they dont get into a physical confrontation and just voices and shouting and anger venting right now. It looks like this is something thats being successful right now and police able to keep them apart and were monitoring that in realtime and let you know what happens there and thats the kind of activity that caused them to buy the handcuffs, clear the beds out and bring all of those extra cops. We have seen cops from california, indiana, we have seen consolidate police here, national guard. All kinds of security here, guys. Theyre working very, very hard here in cleveland. Cant wait to get out there. Yeah. Arent you looking forward to it . See you when you get here, kelly. Thank you. Eamon javers. People arent talking about the election yet. Dows up 13. Transports down 6. Vix lower and the small cops up about 2. 5. Up next, what we have been talking about in the markets, the jupheaval in turkey. Venezuelas collapsing economy is sending scores of people to neighboring colombia. In search of food and medicine. How the two crises play out and potentially ripple through global markets. Also ahead, netflix, yahoo and ibm expected to report revenues after the closing today. And Martin Schroeter with us before his call with analysts. Whats it like to be in good hands . Man, its like pure power at your finger tips. Like the power to earn allstate reward points, every time i drive. Want my number . And cash back for driving safe. And the power to automatically find your car. I see you car and i got the power to know whos coming and when if i break down. You must be gerry. Hey. In means getting more from your Car Insurance with the allpowerful drivewise app. Its good to be in, good hands. Welcome back. Fengss are rising across the globe. Attempted coup in turkey leaving thousands arrested and more government officials removed from office. Joining us contributor with us here a recent nominee by the way to the National Petroleum council. Congratulations. Thank you. And we have with us chief International Correspondent michelle ka russo cabrera. Michelle . Yeah. So turkey key to the United States both in terms of a nato ally, helping us theoretically in the fight with syria and also helping the European Union coming to the number of migrants entering the continent. So when to see this coup, attempted coup on friday and now the subsequent crackdown today which raises all the issues that we talked about on friday, guys, the problematic ally that is president erdogan of turkey, arresting thousands already a number of people saying, you have already gone too far. Are you trying to use this coup to cement your position and garner even more autocratic power at this point . Its a very controversial situation. Even as the western world doesnt want to support a military coup. I wonder, too, the implications for the European Union here. I mean, in terms of staunching the flow of migrants, turkey was an important partner in that as of late and also, the fight against isis. I mean, turkey important transit point for foreign fighters of europe going to syria. Erdogan late to seal the border. Now with the crackdown on the military, are they able to contain the isis situation and we saw with the attacks at the airport remains a virulent threat. What what if we have to deal with a strong man in a strategically located country . The issue is if youre a straw man and control your country, we dont want chaos but, again, the question is, can he control the military . You need the Turkish Military on multiple fronts right now. Thats the concern about the crackdown. The journal had an oped likening it to what happened in iran in 1979 saying obviously we are not there yet and what happens if he cloaks it in the veil of islam and then pushes the country into that political situation . I mean, certainly eastern nato ally. Something we dont want to have happen and amazing art erdogan retains the support of the large sections of the population and why the coup failed and there is a support for the increasing islamization of the turkish politics. Not true in venezuela, guys. I was going to take you there. A failure of an Economic System that just collapsed on that country. Yeah. Were watching it unfold every day. Theres new video over the weekend where they opened the border between venezuela and colombia. 1,300 miles had been shut. And the reason there are 30,000 people on saturday, 100,000 people by the time it was over going from venezuela look at them running. Was so that they could buy food in colombia and the shortages are so bad in venezuela. People are incredibly desperate. They a few weeks ago, a couple of women excuse me. 500 women just charged the border and said, we are going to go across and so desperate for food. And so they decided to start opening the border again. They had shut them because they argued that people buying food in venezuela, yes, subsidized when you can get it. In theory its cheap. But of course, nothing to eat. Doesnt matter how cheap it is and then go across the border and sell it for more and why it was closed and now theyre starting to let people go back and forth and see the desperation in the people. What options does that leave at this point . I think the question is, a self coup and military taking over greater sections of the venezuela economy. The defense min city a head of all agencies and if you cant pay the Government Employees i think thats a real concern. Will the military remain loyal . And i mean, michelle, just the contrast in whats going the happen in a few weeks when you have a humanitarian crisis like that in venezuela and a nearby country will be hosting the olympics where the whole world will be focusing on south america. I mean, it is just going to be such a contrast in stories there. Yes, it is. Even though brazil is having its own economic troubles right. As well at the time with corruption within the country rampant and although they have been better, relative to venezuela about embracing things that would make their economy more competitive, ultimately still they have a very kind of status view of the world and really held them back and when Commodity Prices were booming, brazil lived high on the hog and now theyre not anymore. Thats ditto for venezuela. Theres similarities, yes. There are cont