Transcripts For CNBC Closing Bell 20160719

To bring back glass siegel. Coming up. An Advisory Panel reviewing valent drug right now. The previous reports showed that it influences suicidal thoughts, the drug. More big earnings after the bell. Latest numbers of microsoft and united as soon as theyre out and bring you instant analysis. The netflix, of course, story being the big mover of earnings yesterday still so stay tuned for all of that next hour. But lets start with netflix. Shares plunging today as the Company Reported last night. On kellys watch. The big disappointment came in the slowdown of user growth. Thats the metric that everybody watches in this company. The company added fewer new subscribers than was expected, even than they forecasted and they blamed planned price increases for that slowdown in new users. Is netflix losing the Pricing Power . Lets ask Rob Sanderson joining us with will power. Guys, thanks for being here. Rob, what does this mean for netflix . Are they just not able to keep people around . Yeah. I would put this in to context. They miss subscribers combined, international and domestic by 800,000. They have 85 million subscribers. So less than 1 . They you know, shortfall this quarter. Largely because of turn and cancelation as you mentioned and to say that less than 1 of the base leaving means they have lost their Pricing Power i think is a bit of a stretch. What do you think, will . You have lowered the price target now on the company. What does the latest report say to you about the future growth . Good afternoon, bill and kelly. Thank you for having me on. Look. I think it raises real questions. We had a preview note out at the end of june suggesting based on survey work we did we thought they would miss the u. S. Number and we downgraded the stock at the beginning of the year in part due to the risk and raising price, it creates turmoil in a market to see increased competition and suspected to continue to grow moving through this year and particularly in to 2017. I do think it raises longer term price power concerns. Does it cast fresh light on the move to strike a deal on to comcast and the cable platform and pick up subscribers that way . Yeah. I dont know that thats a material subscriber acquisition channel in the near term. People on the platform are pretty affluent households and likely to be netflix subscribers already. I dont think thats the Bigger Picture on that. The bigger story is this is a pretty big change of a major player in the ecosystem and i expect more collaboration Going Forward and this deal itself is probably not a big subscriber channel. Very quickly, rob. If our gang can put together a fouryear price chart of netflix, i mean, this has had an amazing ride and been a momentum play. It was the best performing stock in the s p 500 for all of last year. Its got to be you know, nothing lasts forever and got to be due for a pullback some point. Isnt this a cause for that right now . No doubt. Precisely why the stock shows so much volatility on marginal swings in the rate of subscriber adoption. Because its con superintendent julily its a big investment mode that theyre in. The valuation discounts potential earnings sometime in the future and thats a debate as to what the longterm opportunity is, the margin structure. Its very sensitive to small fluctuations in subscriber trends. Will, netflix at 85. I think the high of 133. What point are they a better investment and people saying multiple to earnings trading is high . The problem, kelly, is tough to really hard to find a floor. Theres no significant earnings and should start to improve next couple of years. Thats a tough question to answer. We are at a neutral rating. We are not involved or buyers of the stock today and i think to get more agrgressive you need conviction to beat numbers internationally and domestically. I dont think were there yet. Thank you for joining us today. Thank you. On flet flnetflix w. The dow points, nancy tangler is with us today. Steven guilfoyle and Rick Santelli there in chicago to join us. And, sarge, that is hallmark for the market recently. Big move up and no major pullback. Brexit selloff being the lone exception there. We are meandering this week. The buyers light this week and actually in the fourth sideways day since we had our four consecutive higher highs last week. So the market is digesting it. I guess correctly. Hopefully correctly. But you got to figure out what your next trade is. A lot of guys are past the last trade. I myself am still long a tech trade and looking for an exit out of that. Energy is done with. Brexit is done with. The financials reported last week. They outperformed the market last week. Look at the banks now. Its a tough environment. No doubt. But three banks did report year over year revenues higher. Jpmorgan and wells fargo and u. S. Bank. My thought is that if you can get some kind of increase in Interest Rates, through the 1. 6 support for the u. S. 10year, lets say, that one of the three is going to be a play. It depends really on the appetite for risk is and very different betas. Jpmorgan being the highest. Nancy, we talked about specific stocks and just wanted to point out the dollar index today, the dollar up half a point. Its above 97. Thats a fourmonth high. Do you welcome this development . Not for corporate earnings, of course. Multinationals and we tend to be in that space, kelly. We are watching that and it has had a profound the recent weakness had a profound impact in a positive sense for u. S. Corporate earnings so you had another report from j j. They beat on the top line. They beat on the bottom line. Some of that is due to the fact that the dollar has been more friendly to the corporate market. So were watching it. And trying to focus domestically. Youre also watching biotech in particular. Is that right . We are and health care, yes, indeed. Yep. Any particular names there or do you think the whole space especially biotech so unloved and more attractive . Yeah. So, well, we have names. I had recommended j j historically. Abbott labs is a stock we like very much and liked it in the high 30s and we still like it in the 40s. Theyre reporting tomorrow so thats always a little dicey the night before and this is a company that has announced two acquisitions and made the market nervous and so now youve got the earnings that theyve beat on the top and bottom line the last two quarters which is pretty hard to do in this market. And this is a Management Team to integrate any acquisition, dm demonstrated with skill and speed and not worried about the st. Jude acquisitions. We like this company for the mid and long term despite the politics. Rick, same question to you on the dollar. How this complicates fed policy Going Forward if this strength continues here. You know, not that were expecting them to raise rates any time soon but it shuts the door for a little while then. You know, i just think that all this hand wringing over the strength in the dollar, and it is a very interesting spot for that dollar index at 97 handle, now, obviously, this is the best level since march and calling it a fourmonth high. We still closed last year even higher but i look at it different from the fed perspective. I think they have wasted a lot of time where the dollar under a bit of pressure and could have maybe started normalizing. I think the normalization is going to create its own more bullish dynamics for the greenback and postbrexit world, where everybody else is growing in a less desirable fashion than the u. S. And not a 4 economy, that the Dollar Strength is inevitable. We are arguing about how contained it will be, when will it take out last years close . I think its a matter of time. If you look at everything out there, Housing Starts, permits, many months over a million and less than half of what they were at the peak in 05 and 06, all the data isnt too bad. You said off the radar screen. I personally think thats going to be a news story once again getting closer to the fed meeting. It still makes zero sense to me. I still somewhat agree with jeff gunlack and dead money doesnt mean that the market has to go down but a light upward trajectory is not only in store for the rest of the year but it could be the longterm prognosis for equities and Interest Rates back down to 3 basis point negative on boons. We are challenging 80 basis points again on 10year guilds. Our market failed to get up to yesterdays closing yield. So i think with all these dynamics, the fed should wake up. The dollar index is strong and a matter of what propels thing and to no, maamalize policy in any way, shape or form without a strong dollar is foolhardy. Do you agree . Is september creeping back in the picture in terms of a rate hike . I absolutely agree with rick. We have retail sales. Core cpi. We have a plethora of june data that looks pretty good. Wage growth and that value of the dollar are two things that argue against normalizing right now and bite the bullet. Is september too close to the election . I dont know. It might be. But is it the right thing to do . In the eight weeks between the july and september meeting, is it necessary . I guess well let you know. Wow. Do that. You have our number. Thank you, folks. Thanks, everybody. Thanks. What do we have . 49 minutes left in the trading session here and the trading range for the dow Something Like 50 points today and it was the same amount yesterday. Right now were down a point. Thats what makes the move in the dollar probably the standout today and the move in netflix. Microsoft and United Continental report earnings after the bell today. Well run through the streets forecast for you. Break down the numbers as soon as they hit the tape about an hour from now. Up next, though, going after the big banks with a page out of Bernie Sanderss play book. Donald trump wants to reinstate the glasssteagall act. Well discuss the merits of this idea and whether it could backfire on the republicans. And later, former new york city mayor giuliani will join us, speak with us exclusively fresh from the fiery address last night. Youre watching cnbc, first in business worldwide. Can a toothpaste do everything well . This clean was like pow. It felt like i had just gone to the dentist. My teeth are glowing. They are so white. 6x cleaning , 6x whiteninga in the certain spots that i get very sensitive. I really notice a difference. And at two weeks superior sensitivity relief to sensodyne i actually really like the two steps step 1 cleans and relieves sensitivity, step 2 whitens. Its the whole package. No ones done this. Crest healthy, beautiful smiles for life. Welcome back. Shares of mcdonalds higher today. Among the best performers in the dow today as a matter of fact. Japanese unit teaming up with nintendo to make its restaurants kilo cases for pokemon go players. You knew that was coming. The deal would be the first tieup for the wildly popular augmented reality mobile game. It could be announced as soon as tomorrow which is when pokemon go goes live in japan. I cant believe that it wasnt one of the first countries that they introduced it in. Thats where it was developed. Any doubts of how successful it would be, i hope they have the capacity to handle when it finally goes up in japan tomorrow. Fire the servers up. The nations biggest banks in the cross hairs again, a target of donald trump who wants to reinstate the glasssteagall act. John harwood has the latest from cleveland. Hi, john. Reporter from the Media Attention today, you think the only story at the convention is Melania Trump and the speech last night but guess what. We are talking economic policy, too. The theme of this convention tonight is make america work again. And the republican platform has a fascinating bit of political turn about. All throughout the primary season Bernie Sanders went after Hillary Clinton for not being for the revival of glassstegall and many on the left blame it for causing the crisis of 2007, 2008. Guess what. Now donald trump jumped on that pile trying to appeal to Bernie Sanders voters. So youve got this alignment on glasssteagall, to revive it, donald trump, Bernie Sanders, Elizabeth Warren who he attacks as goofy all the time. Who wants to keep it or, excuse me, keep the prohibition . Hillary clinton, bill clinton and larry summers. Now, youre going to want to bet on the latter group prevailing because Hillary Clinton is favored to win the election. Shes leading in the polls. And second, there is no indication that donald trump has any personal strong feelings about this. This looks to be a campaign gambit for him to appeal to those Bernie Sanders voters and disaffected democrats. Dont look for this to become law if he is able to win the election, guys. Hmm. You know, john, it strikes me that were talking about so many double negatives, were reinstating glasssteagall . Reporter thats right. Obviously enough of an issue to work in terms of speaking to what people want to see out there. Its part of the redefinition of the Republican Party, right . Reporter yes. If you think that donald trump is redefining the Republican Party in a lasting way. This is actually one of the Big Questions of 2016. Is this a new Donald Trump Party Going Forward . Or is donald trump who is favored to lose the election going to be a momentary phenomenon within the Republican Party and goes away . Because on immigration, on trade, on entitlement reform, all the issues he is running with nontraditional republican positions but few republicans are following him right now. And you saw from the cool reaction of, say, jeb hensarling, in the house, theres not going to be a lot of republicans in congress who follow donald trump on this particular political gambit. In part, because many republicans and democrats like bill clinton say the end of it had nothing to do with the financial crisis. Lets bring in terry hanes head of political analysis, what do you think about this . I mean, clearly, as john suggested, hes going after disaffected voters that will follow Bernie Sanders or maybe even Elizabeth Warren. But does he risk alienating Republican Voters who would be dead set against reinstating a regulation on the Financial Markets and the banks . Hi, bill. Thank you for having me. A couple of things. In every platform there are the serious positions, the compromise positions and the purely political positions. I put this in the purely political. Anybody that thinks that glasssteagall is coming back thats a fantasy. Its two good things for trump politically. The first good thing for him is try to solidify his talking points about Hillary Clinton as being in the pocket of wall street. Second, its an outreach to main street america to say im serious about your protecting your savings, your investments and making sure that youre better protected and that goftails with a lot of republican rhetoric. Why are we presuming this is a nonstarter . Is it just because you think that it would be difficult policy to put into place or do you not think its what people really want . I think two things, kelly. One is, you know, historically, it was up for repeal from almost the moment that it was put in place in the depression. Right. Glass of senator glass wanted to repeal important parts of it within two years after it was first established. Secondly, i mean, part of what i do for a living is look closely and stay close to the political views and policy views and i see almost no support for glasssteagall at all. John mentioned congressman hensarling of the Financial Services committee who put out an important document last month that showed his vision for how Financial Services regulation ought to be revamped. It is nothing like glasssteagall. The Republican Party is not here and politics is an interesting gambit. Kelly, let me just add on to that comment. 99 of the American Public have no idea what glasssteagall is. Not to we know what it is how did it work on the campaign trail if no one knows what it is . I doubt it will work on the campaign trail. Did Bernie Sanders win the democratic nomination . I dont think so. You know . He was very aggressive on this. So did Martin Omalley and the campaign didnt go anywhere and pushing, challenging, Hillary Clinton to join me in calling for the the revival of this. The idea that you can take a Political Party or a candidate and all of a sudden plaster on a position that nobody takes very seriously and say, oh, thats going to be a huge vote magnet . I dont buy it. Listen. Its a symbol of what people want basically to bust up the banks and apparently thats got bipart son support if not in truth. They dont want another crisis in 2008. Do we blame the repeal on that, terry . Hillary clinton is also for not breaking up the banks and won the democratic nomination. Bernie sanders Central Economic policy vow to break up the banks. So obviously, that was not a Silver Bullet for him . Last word, terry. Bill, i wouldnt suggest glasssteagall is responsible for the financial crisis. Blinder famously said once he challenged anybody to show him how glasssteagall would have stopped things. He didnt get a good response yet. It is a lot of things, one of which is a mantra for a Certain Group of folks who think that Financial Regulation ought to change. What trump is sug naling to them and others is that he takes the regulatory challenge seriously and as a political matter one of the things thats fascinating about it is flanking democrats doing it. Yeah. All right, guys. Thank you. Thank you so much. Good stuff. Thank you. Were still arguing glasssteagall 90 years later. I love that. Gop heavy hitters coming up. We have supporter Foster Friess for his take on this call and made the fortune in the financial space and former new york city mayor giuliani who spoke last night at the convention will also be speaking with us. Be sure to stay tuned for those. In the meantime, we have 37 minutes left in the trading session here. Another narrowly traded day. In fact, right now, the vix is at a low, close to a low for the year down to 12. 36 right now. Up next, Valeant Pharmaceuticals meeting with regulators on the key of an experimental drug. Chinas box office expecting to be the number one movie market in the world soon. Maybe next year. Hollywood is hoping to cash in. Julia boorstin has the lowdown when we come back. Mary buys a little lamb. One of millions of orders on this companys servers. Accessible by thousands of suppliers and employees globally. But with Cyber Threats on the rise, marys data could be under attack. With the help of at t, and security that senses and mitigates Cyber Threats, their Critical Data is safer than ever. Giving them the agility to be open secure. Because no one knows like at t. Why dont you let me. And me. Help you out . Youre gonna hear what i say. I love taking stuff apart and building new things out of it. Anne pals my most advanced annedroid. [gasps] this is awesome. Oh anne you havent seen anything yet. Announcer give your Cardboard Box another life. Welcome back. Look at the Health Insurers today, under pressure of reports gearing up to File Lawsuits to block proposed deals, anthem slated to take over cigna and anthem wants humana. Investors had been hoping the etnahumana deal would pass muster. You can see the acquirer shares down nearly 3 . Humana down more than that. Cigna down 2 and believed to be the best positioned according to analysts. Surprised there. Breaking news on valaent pharmaceuticals. Meg terrell has the latest. Meg . Hi, bill. Meeting of outside advisers meeting today to discuss whether a new drug for psoriasis should be approved and there were concerns because an original developer of the drug discontinued the development of it because it was potentially linked to suicidal thoughts and behavior. Valaent continued the development of the drug and they say just voted on whether the safety and efficacy profile warranted approval. They voted positively 180 the profile supporting approval and theyre talking about how much labeling to go around the drugs to warn doctors of the potential suicide risk. Four of the Panel Members voted that just labeling will be enough to support the approval of this drug. 14 of the Panel Members say that more strict sort of measures need to be put in place and what theyre discussing right now. We did see shares pop into the green gribriefly on this decisi and leveled back out again and desperately needed good news for valaent. They backed approval. The Company Needs to show it has a Growth Strategy Going Forward. I imagine this helps. Absolutely. This is part of their pipeline strategy focusing on research and development. Wells fargo, which is probably their david mariss bearish on the street and estimates 250 million in 2020 and argued potential downside and most baked approval into models and how stringent that label turns out to be is important. This, of course, just a meeting of outside advisers. The fda set to decide in november on this drug. All right. This stock just a fraction higher after trading lower. Maybe on that news right now. Thank you. See you later. Time now for a news update. Lets get to sue herrera. Hi, guys. White house spokesman josh earnest said the u. S. Condemns north korea for test firing three ballistic missiles. Gop Vice President ial candidate mike pence calling on conservatives to unite behind donald trump. And compared trump to the late president ronald reagan. He made the comments in a speech to the American Conservative Union in cleveland. I have a sense of this man. I have a sense of his heart. I have a sense of his hands on style of leadership. And for all the world, he reminds me of ronald reagan. Airbnb agreed to collect and pay Los Angeles Hotel taxes under a threeagreement with the city. The deal could bring in nearly 6 million in annual revenue. Starting august 1st, the Company Responsible for paying the 14 tax owed nightly by people who rent out rooms. And tiger woods will not play in any professional events for the rest of the year as he continues his recovery from back surgeries according to a report by his agent. Woods will have missed four straight majors. We wish him the best of luck in the recovery. Some wonder whether he will ever come become. I hope im wrong and im on record as saying i dont think hell play again. His body is just breaking down. Even he acknowledges its harder and harder and harder to come back and these were major surgeries he went through this time. Extensive therapy and had after each surgery and wish him the best. Both of you from the area. 14 room tax in l. A. . Oh yeah. Oh yeah. What is your point . Thats a lot. Yeah . On the other hand, kelly, we live in new jersey. Dont go about the tax thing because sticker shock there, as well. Were paying a lot so thats true. Thank you, sue. Youre welcome, guys. See you in an hour. Oh, the t, word, taxes. 14 . A room for 200 bucks, by the time not paying 200. More than this. Not getting one for 200 in l. A. Either, i suspect. Thats correct. Theres the dow in the green. Nasdaq and s p we mentioned the dollar index at a fourmonth high. A leading trader tells us what hes watching as far as that goes. The chart on the dixie as sarge would call it. Current and incoming ceos of ameritrade talk with us exclusively. Stay tuned. Foand millions moremericans lwho feel its effects. S, lets walk together to make an even bigger impact and end alzheimers for good. Find your walk near you at alz. Org walk. A 26 minutes left in the trading session here with the dow up 13 points. Joining me here at post nine mark newton of newton advisers and mentioned the fourmonth high for the dollar index, a standout right now in a pretty quiet market. What do you make of it and where are we going from here . We have a chart of the index going back to last year. Very meaningful move today, bill, in the u. S. Dollar index and take a look at today, todays the first day managed to get back above april highs and putts things at the highest level since early spring and important, suggests to see further upside to the dollar given the time the u. S. Starting to show better signs of economic strength versus the rest of the world. Seen yields pop up. Obviously earnings could be, you know, that could be obviously detrimental to earnings given we were down 9 last quarter and now a steady rise up in the dollar and head winds there. What do you think . Can stocks go higher if the dollar continues to strengthen . Its tough to see the correlation. I think near term stocks moved too quickly and im still bullish in terms of immediate term trends and s p and dow dont reflect the world indices. The dollar locks like it moves up and commodities to roll over in a bigger fashion and growth should start to outperform value and we havent seen that nearly all year. Very quickly. Go back here . What do you think . I think probably can get up to at least the highs of last invest, december and that would be a very meaningful level of resistance for the dollar index. Mark, good to see you. Thank you. Kelly . All right. Chinas box office is well on the road to becoming the worlds largest. Hollywood has taken notice. Julia boorstin has more. Yulia . Reporter thats right, kelly. Next year, the box office is predicted to surpass the u. S. As the Biggest Box Office in the world and nows the first time chinas allowing in foreign films in traditionally a blackout period in the summer to limit competition for those chinese movies. The first film allowed in this period teenage mutant ninja turtles. Grossed 57 million in the country. And today Warner Brothers legend of tar zahn opens up in china. With the loosening rules they say chinas box office could be double the revenue of northern double the total revenue of north americas by 2025. Which is impacting hollywood decisions. Theyre thinking about putting elements in movies that would appeal to chinese consumers. And i think theres also some thought to editing movies to get past chinese sensors. And Chinese Companies want to tap into hollywoods power in january. Chinese media giant bought legendary, the studio behind the dark knight and now is reportedly breast interested in buying a stake in viacom. Back over to you. Thank you very much. Julia boorstin there in los angeles. 23 minutes left in the trading session with the dow up 12. Td ameritrade better than expected earnings out today. Well break down the numbers with incoming ceo and outgoing ceo coming up next. And its been one day but plenty of controversy and stories already of cleveland. Later today donald trump nominated for president at the Republican National convention. Well talk about last nights fireworks with former new york city mayor giuliani. And well talk about trumps prospects of long time stock pro Foster Friess. Stay with us. Youve wished upon it all year, and now its finally here. The mercedesbenz summer event is back, with incredible offers on the mercedesbenz youve always longed for. But hurry, these shooting stars fly by fast. Lease the gle350 for 579 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. Welcome back. Shares of Td Ameritrade higher by 2. 5 today after the Company Reported earnings better than expected driven by increased commissions and fees. In a cnbc exclusive, were joined by ceo Fred Thompson and the successor. If i may, what are you doing retiring . Were the same age. Okay . Were mid range baby boomers. Every time i start making noises about it, she hits me on the shoulder. Thats right. My 98yearold mother says im too young to retire. Ive been with ameritrade for over a decade now and i do believe theres a time when a ceo, time to turn it over to the next person. Ive had a great run. I feel proud of what ive built and i think it was a right time for the company. Little bit more the right time for me, too. I got some other things to do personally. I hear this. 270 billion to 836 billion in client assets. You know, youve seen Remarkable Growth in a period of a lot of people have been disinenchanted with the stock market. So, you know, do you make the case for people for stocks in particular Going Forward . Do you try to just keep pushing options and strategies and ways that people are investing today or what do you think . Well, i think one of the best things i did is crisis, took over, we took advantage of the dislocation of the market went for market share and worked for us. I think now its a very different point in the market and, you know, weve got historically the equity markets at historical levels and the bond market and its a difficult time for investing. Main thing is to keep investors focused on the long term and a plan. How do you do that, tim . Clearly traders must love the market right now with all the uncertainty and the volatility we have seen especially since the brexit vote and longterm investors, cash levels at highest of about 15 years in the aggregate. What do you how do you get the longterm investors back in the game again . Interestingly, if investors have decided they want to invest in the stock market, which many have and we see the new account openings up year over year and we have seen to your point is that cash levels are declining at alltime, almost alltime lows in terms of a percentage of their holdings. In your shop . In our shop . Really . We found declining and then postbrexit vote you saw more invest back in the market with the opportunities that afforded them. Interesting. Looking at a lot of changes in terms of what people think is viable investment strategy. Pulling tons of munl out of active things. Putting it in passive funds. Does that affect trading some point, too . Do people get a sense of i better not try to time the market myself or under anyone elses watch and put money in there and let it sit and ride . For the longterm investors we have seen a shift of traditional mutual funds in etf but in terms of active traders, theres still opportunities to take advantage of the market disruptions like brexit. What do you do with you know, the fed not likely to raise rates any time soon and everybodys investing for yield right now and not for growth. That cant last forever. Right . Thats a part of the equity markets and the fixed income markets. The dividend yield on the s p 500 higher than the 10year bond and highly unusual and seeing a bit of a rotation into the yield based stocks and defensive stocks inside the s p 500. You guys known each other for 20 years . 20 years. Is it advice that youre passing on here . Leaving a todo list . Hes been giving me advice for 20 years and all good. And when it goes, what are you going to do . You know, i sit on one board outside and spending more time with my family to start off who, you know, ive been traveling a lot and working for a long time. Dont give him any ideas. I still got too much energy and then im going to do some stuff, board work and, you know, my friends are going to help them out with the Florida Panthers a bit. Yeah. I read the other day you played hockey in college and now youre being replaced by a guy named hockey. Doesnt play hockey. My wife does. Awesome. I love that, too. Good to see you both. Congratulations and good luck with the retirement there. Tim hockey, the soon to be ceo at Td Ameritrade. Thank you for having us. Watching the market with the dow higher an the s p and the nasdaq in particular lagging today. The nasdaq down. David bondson thinks that a Market Correction may be in the offing come november. We know what happens then. Happens to coincide with election day and laying out the case when we come back. Everything well . Ste do this clean was like pow. It felt like i had just gone to the dentist. My teeth are glowing. They are so white. 6x cleaning , 6x whiteninga in the certain spots that i get very sensitive. I really notice a difference. And at two weeks superior sensitivity relief to sensodyne i actually really like the two steps step 1 cleans and relieves sensitivity, step 2 whitens. Its the whole package. No ones done this. Crest healthy, beautiful smiles for life. Announcer dont let salmonella get funky with your chicken. On average, one in 6 americans will get a foodborne illness this year. So, learn the right temperature to cook each type of meat. Keep your family safe at foodsafety. Gov. Little over ten minutes left in the trading session here with the dow up 15. Art cashin stepped by the market on close orders, as you can imagine. 100 million. 150. Very good. Close. To buy, that is. Hes not expecting that to have much impact on the market as we head toward the close here. David bondson is with us today. You know, oh, im sorry. We have earnings to get to first. Lets do that, shall we . Earnings coming our way tonight. Weve got in san francisco, josh lipton with a preview of microsoft and susan li at headquarters with United Continental airlines coming up. Josh, start us off, buddy. Well, bill, microsoft is betting that the Earnings Report is better than last one when, remember, that stock dropped 7 the following day. So for q4, analysts expecting eps of 58 cents. That would mean a 3 decline on the bottom line. Sales of 22. 1 billion. Basically flat from a year ago. There will be a lot of attention on asure. Estimates it jumped 116 to 879 million in the quarter. Also in focus, that transition to office 365. The pressure on windows revenue from a weak pc market and anymore color we can get on that mega deal for linkedin. Back to you. All right. Thank you. And meanwhile, susan, what are you watching . Yeah. United continental and guided for a better Second Quarter with airlines. Passenger revenue for each seat flown a mile, united said it hits the high end of the forecast and lifts the stock and then called a buy. International passenger yields are better and united saw an uptick in Business Travel in the last week of june. Still, though, the markets calling for a revenue decline of 5 of a year ago and earnings to fall some 23 . Back the you guys. All right. Well see what happens. Thank you both. Well see you at the top of the ea hour when the earnings come out. David bondson is here with us. We havent talked much about the correlation if there is one, the impact that the election is or is not having on the stock market here. What is your view of that right now . I think the election is like any other thing and not good or bad news but unexpected newses. Right now, the market is reasonably priced in the odds of waking up and democrat being the president and the republicans being in charge of the house which is what we have had for six years now and to the degree things change, it could recalibrate that and the market doesnt have a particular search at this point. Four months to go and a lot can happen. A crazy primary. The fed global yields far bigger impact than the u. S. Election. You have a couple of specific ideas. Blackstone. Enterprise products. And the reason those names i kind of want to highlight is so much we think that we think is pricey and frothy. Consumer staples, telecom. Theyve gotten expected. Blackstone is out of favor and we think a high quality name. Great growing dividend yield. Lyondellbasell is an interesting one. Yielding 4. 5 and yet its down about 20 a share in 6 months. Free cash flow growing. The Enterprise Products one is a huge recovery story up 50 from the bottom. The whole mlp space is kind of recovered. Found new life. However, enterprise just had its 57th consecutive dividend increase. Its still yielding over 5 and now with the waters a little stiller in the space, it is the cream of the crop name. How much longer does the market obsession dividends plays last . It should last forever but i think that the kind of trend right now and that heavy fat around it will die off when bond yields go higher. When thats that going to happen . Thats a big question rye you worried with the names you mentioned about yields going higher . Im not. I think the spreads so wide there theres a big buffer and a reason we picked them. Blackstoenl at 8 , if the 10year goes all the way from 150 to 2 , thats not really going to move the needle. Same with mlps and not moved the way utility have this year that are up 26 , 27 with no Dividend Growth and i think a lot of buffer there but how long that story will go, will be interesting to see. Yes, it would be. Lasted quite a long time to this point. Good to see you. Good to see you again. Well take a break here with the dow up 15 points. And with the closing countdown in a moment. After the bell, twitter fresh off the agreement with nfl hoping sports helps t. Youre watching cnbc, first in business worldwide. 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™. 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Just about three minutes left here toward the close with the dow up 21. Were at the closing countdown. Bob pisani is with us. Welcome back, sir. Thank you. Lets do a onemonth chart just for fun and keep in perspective how far we have come since the selloff following the brexit vote. We start with the s p. And there you have that. And over this time, this takes us back a month. So, you know, to late june. For want of a better term. Up 4. 4 in that time. Very narrow trading session. 6, 7 points today. Good news. Lock at the chart and how much we moved up. Moving sideways for a few days, very good idea for the market. Look at the dow. Same time frame. One month. But clearly, after the big comeback, we have reached what you might call cruising altitude for these major averages and we have just kind of been very quiet the last four trading sessions here. Now we have to wait and see whether earnings justifies what we have got here. The gains we have had and why im encouraged about today. Look heed martin, john and johnson, both raised the full year guidance and comments. Was very positive. United health care raised a low end of the guidance and what you want to see right now. What has been moving higher, again, is the dollar index. Back to a fourmonth high right now in the 97 range. And we were going the look at that. There it comes. Thats a problem with the material stocks today m. Of those were down on the Dollar Strength and that dollar moved up this morning as we had the Housing Starts number better than expected for the month of june. Keep an eye on that one, though. We have earnings out tonight. Susan li and josh lipton tells us about microsoft and United Continental airlines and what to expect from there. What i want to hear from microsoft, they get about 10 of the revenues from china. Id like to hear them comment about that and help us out on the International Front and now getting the big tech names. Well also be getting some of the Big Industrial names. Illinois tool works, a favorite company, makes tools, makes automotive components, all over the world. They have a global economy. Theyll comment. Now well get something besides just the big banks and well see if the earnings which have been good, the banks had beaten, all of them have beaten and saw very good beat today and mentioned by Lockheed Martin and uniteded health care and see if the broader sectors that are out there will do better and so far 11 of the s p reporting. Earnings better than expected. All right, bob. Thank you very much. So as art cashin predicted, the market on close orders little impact on the market. But the s p stumbling a bit. Stay tuned for those earnings and Rudy Giuliani from cleveland on the second hour of the closing bell with kelly evans and company. See you tomorrow, kelly. Thank you, bill. Welcome to the closing bell, everybody. Im kelly evans. Theres the bull with the green eye, again. Dow closing at an all thf time high. Adding 26 was enough to do it. 18,559, thats the new high watermark for the blue chip index. The dow 30. S p 500 bradley dropped 3 points today, 2163. Nasdaq, underperformer down 19. Closing still above 5,000 at 5036. Investors turning to a pair of big Earnings Reports this hour. Josh lipton following microsoft for us. Susan li covering United Continental. Seeing you in a moment. Cnbc senior markets commentator and columnist Michael Santoli is here with tech analyst jon fortt and trader guy adami. Guy, great to have you along with us. Mike, listen. Another day, another record high for the dow. Yeah. The broad market just very, very gently, quietly pulling back after the pretty strong gains into the end of last week. The dow is benefitting from the preference of quality stocks and j j having an influence there and seems everything is pretty much intact in terms of digesting that rally. I think the two things to watch on the margins is the market fighting the strong dollar. See if that mat earls and Weaker Crude Oil and then the rising expectations for maybe after the wall street journal report today the fed more active and overall the reaction to earnings mixed and okay. Good enough for what we expected. Except the nasdaq, meanwhile, jon, lagging a little bit today and things going on there. Yeah, indeed. And for me, it is netflix versus vm ware. You have two stocks that have these growth histories. Netflix disappointed and more people out the door. Old discuss merles out the door than expected. Vm ware, though, on the cusp of getting fully rolled into dell, the stake that emc stake rolled into dell. Better than expected. Showing strength in the enterprise and people wanting to do things on the data centers and which way does microsoft go because of that . The cloud is where the valuation is coming from and getting the information. Wasnt the last quarter it was a disappointment on that front and microsoft stumbled. Well see. The shares up 9 today. By the way, seeing Goldman Sachs traded today. I think one of the dow laggards and, mr. Adami, they beat this morning. Beat, huge beat on eps side. Huge beat on the revenue side. Year over year in terms of eps and revenue, significant beats. But what comes down to youre hearing and i dont know if this is why it traded lower. Historically, goldman has to crush for the stock to follow through. But i think some of this rhetoric coming out about the potential to reinstate glasssteagall doesnt help names like Goldman Sachs. I think thats it. Coupled with the fact of a huge run over the last couple of weeks. Maybe one of the things buy the rumor, sell the news type of events. I would add yes Goldman Sachs crushed, 360something versus 3 as the estimate but as recently or three or four months ago the estimate for the quarter is 376. The stock is up and kind of a what else do you have for me response by the street. So is it possible that pokemon pushed us to new highs . Mcdonalds adding 19 points to the dow and closed up 26 and that was on some story of pokemon. Kelly, we are giving it pokemon go credit for everything these days. Reviving local businesses. Trimming getting kids out of the house. Pounds off of chunky kids. Theyre doing everything. So yes. Why not . I did see a headline a tourist was mugged in central park while playing pokemon go today. I thought you were going to say buy a pokemon. I need to rethink the run route. Bringing up the glasssteagall issue which people vehemently came out today and a guest last hour dismissing the idea to happen. But, you know, listen. Goldman maybe is responding to that. Maybe the stock is. Look. I hate to go into the realm of politics but for this one brief time i will. To me, if you look at it, its a bit of a political ploy. Right . Hillary clinton steadfastly said she doesnt want to reenact glasssteagall and Bernie Sanders is in favor of it. Right . So if donald trump swoops in and says, you know what . I would be in favor of that, is that his attempt to maybe bring some of these sanders voters over to him. Having no idea what hell do if he is elected president , its not that tactically its not that bad of a move and tell you something. The people voting for him are voting for him regardless. I dont think saying that will alienate the voters and maybe a chance by saying this youll bring over the sanders guys and gals that are on the fence. Okay. So meanwhile, we turn back to the u. S. Dollar. Which is also itself a political issue. Popped a half point today. Closing above 97. A fourmonth high and close to its 99 level, mike, when there was real concern about is this going to slow earnings. So does this start to enter the narrative again and is it because reports of the wall street journal and maybe september is back in the picture for a rate hike . I dont know if its just because of that and working in the favor. You know, the dollar index at 99 i think lets say march. Most recently. So it doesnt seem as if its manager to taking off to the upside and it is toward the upper end of the range and i think that that chatter is getting revived right now. Especially if we got a couple of more nick data points and hearing much next week and the twoyear note yield did not surge higher on the news and expect if the market positions for something on the fed front. We move through the big tech or into that piece of the earnings season, jon, more discussion about the dollar and not as if its the main thing going on here and look w457d with the arm deal yesterday. It was interesting so whats its face, softbank, holding arm holdings and the brexit vote happened and did they get a big discount and arm shares up 17 since then and the revenues in the u. S. Dollar. Yes. So the connection between brexit and the arm deal i think is a bit tenuous. I mean, arm had been on a bit of a run since softbank could have picked it up a while ago. Softbank had all the money from alibaba sitting around and wants it into something to create a legacy or something to build on. Right. Arm has an opportunity in internet of things thats going to take decades to play out. Masa son takes a long view. I dont know about that. We look at the tech earnings in Constant Currency and affects the tone of guidance and with a strong dollar, especially were looking forward to microsoft earnings and commentary, it factors in. I think i read, guy, arm has 3,600 employees and bought for 32 billion. Unbelievable, right . I do think microsoft is out. And im looking for it but to your point, theres money sloshing around and part of this, you know, zero Interest Rate policy allowed companies to make moves like we are seeing. Thats whats going on. And i know am trying to find out the microsoft numbers for you. Josh lipton, right now, sharyls are popping. What can you tell us . So, kelly, get you those numbers. Microsoft reporting eps of 69 cents. Kelly, the street looking for 58 cents on revenue. 22. 64 billion. The street forecast 22. 1 billion. Just looking to the different segments quickly, kelly, cloud grew 7 to 6. 7 billion. Just looking under the hood, it looks like azure revenue jumped. Personal computing, the flagship windows operating system, declined 4 to 8. 9 billion. And then finally, segment includes office software, looks like revenue there grew 5 to 7 billion. Going to keep combing through the release, kelly, bringing you more numbers. Back to you. Shares up a little bit more than 4 . What do you think, jon . Good quarter. In the cloud in particular, and this is what were really looking for, office 365 commercial Revenue Growth of 54 . 59 in Constant Currency. Down from the 60 range that we had seen the last couple of quarters and what you expect once you start to see that install base transitioning more. Office 365 consumer subscribers being at 23. 1 million now. If i recall correctly, lets see, they were at 22 ill call it up in just a moment. Sure. They were at 22. 2 million. So thats actually pretty good, too. Theyre growing less than a million a quarter at this point. They had been growing at 3 million a quarter a year ago. Again, you have some saturation happening there and the subscribers will have revenue that just keeps rolling in. Kind of year after year. Thats positive overall for consistency of microsoft. Guy, what do you think . Not to pick on ibm but you understand why rim trades at 11 times forward earnings and microsoft closer to 19 and microsoft in my opinion able to turn that boat around. They made the pivot when they needed to. And now the fruits of their labor being rewarded in terms of what you are seeing with cloud. So will this rally hold . I think it will and kudos to pete that talked about microsoft for quite sometime. The move in ibm faded yesterday. It should have. I think the move in microsoft holds. I understand the difference in terms of valuations. Microsoft is a much more expensive company but i think they deserve that premium over an ibm. Ill just point out in terms of the stock, trades up into the 55 range. 56 and change is where it was before that previous quarter Earnings Report and about where its peaked out a couple of times this year and kind of tell you that they have full assurance that the story is back on track. What about profit margins, guy . Comes up with other companies and shifting to cloud and too much of a sacrifice or not the microsoft story . Looking at ibm it seems to be theyre sacrificing margins, absolutely. 17 quarters of decreasing revenue and the margins waning, as well. For some companies it is a story. I think microsoft, im looking for the margins now. I apologize, i dont see them, but they seemingly able to maintain the margins and move into an area they werent in five or six years ago. I do say kudos to them and good news in my opinion is the companys that are doing well are being rewarded and the companies that are sort of languishing or being punished and you know what . Thats corporate darwinism and how it should work. This is a nice magic trick that microsoft pulled up this quarter. Windows non pro revenue up 27 . Pro revenue up 2 . Outpacing thepc market and microsoft and surface revenue up 9 driven by microsofts own hardware. Of course, phone revenue is down. Microsoft announced the end of the exiting a lot of phone businesses. But even the more personal computing unit, once you take out that phone business, where they clearly have not succeeded, looking pretty good, kelly. All right. Guys, thank you. Guy, well let you go. Microsoft sharyls up 4 there and theres much more coming up next hour. Guy adami and the rest of the crew at 5 00 talking to rich greenfield, one of the biggest bulls on netflix saying the story is intact and tell us what hes looking at next hour. Microsoft shares rallying on the better than expected earnings. Well discuss whether this underperforming stock is ready to shine and breaking up the banks is something Bernie Sanders pushed and now at the forefront of the republican platform. A top trump donor tells us whether he agrees with the stance and impacting the economy. Also joined live by former new york major giuliani in the wake of the fiery speech at the Convention Last night. Bend me shape me, any way you want me as long as you love me, its alright bend me shape me, any way you want me. Shape the best sleep of your life. Sleep number beds with Sleepiq Technology adjust any way you want it. The bed that moves you. Only at a sleep number store. Welcome back. With breaking news on roger ailes. David . Number of reports out the last couple of days about the man that helped found the Fox News Network giant in the News Business. As many people know. Embroiled in a controversy, of course, brought on by a lawsuit of Gretchen Carlson of sexual harassment. We can add our own reporting to that thats out there and saying that sources familiar with the situation do indicate that fox itself is moving closer to a decision in the near term involving the future of mr. Ailes as, of course, the man that runs that Network Annual it does appear likely to result in his departure from the network. Now, that might end up being, of course, retirement. He is 76 years old or a resignation and could conceivably at this point also be termed a firing. That remains very much unclear at this point. But again, people, a number of sources familiar with the situation do indicate that they believe that this will reach a conclusion in the near term. That being the future of mr. Ailes. And that while the investigation of his conduct of paul weiss, the law firm, will continue, not completely clear whether or not they wait for the results of the investigation are made clear to them. That does seem to still appear to be the likely outcome here and regardless given what sources indicate, of course, as well as sort of as you might imagine a bit of uncertainty at that network, they do want to make a decision. That being the gentleman who run fox, namely murdoch and the departure in the near term and called roger ailes. I have not heard back from him, of course. You know, it is funny. The stock market front, this is a very significant part of 21st century foxs business. The Cable Networks just quarter contributed i think about 1. 375 billion in operating income before depreciation and much of that from fox news directly and or because of its power and ability therefore to force cable distributors to carry other fox networks part of carriage arrangements because its so popular. It is not unimportant and speaking to any number of Media Investors in the course of today and whether they were concerned at all about the future of fox news, they uniformly told me, no. Theyve been expecting some point that he would depart and 76 years of age and they would expect that things will continue to be run more or less the same way they have been with, of course, the Great Success that network has seen for many years in terms of attracting many viewers and becoming a financial powerhouse for twentyfirst century fox. Back to you. A quick question. You mentioned they do call it 1. 4 billion for the Parent Company in earnings. Thats a huge number. Now, some chunk of that is from fox news. And in this day and age, with all the disruption we are seeing, this asset would seem more important than ever to the company. So, under its new leadership, do you expect its going to take any of a different kind of direction, or are they going to try to look for, you know, try to keep things as much the same as they can to not rock the boat here . Yeah. Always, always interesting to talk about the News Business in general, kelly. Of course, since it eels our home, as well. The expectation on the part of a number of people i have spoken to is that you could not expect to see any certainly near term changes of regardless who takes over and of course succession is a key part of this story regardless of when he departs. Will it be internal . Possible they have identified external candidates . I have heard differing versions of preparation for the departure as to whether they have identified some people in other sources tell me theyre not as certain that is the case. So, your question is a good one. You know, it is interesting to note over time, perhaps, there will be changes. Who knows . I certainly cant progrenostica on that and hard to change a formula for Great Success at the company for such a long period of time. But when you get new management, in the form, by the way, of course, of James Murdoch and lockland murdoch and then reporting to them running the network, might be changes over time in the way they approach things and time will tell to use a well worn phrase and really sorry i had to use. Still remarkable development, david. Thank you for bringing us up to speed there. Lets get you the earnings of United Continental out now. Susan . We have a beat on the top and bottom line for United Continental. 2. 61 adjusted. The market, the street looking for 2. 56. 9. 4 billion. The street looking for 9. 38. One important metric as i mentioned that defines airlines is passenger revenue of street mile and forecasted range. United continental last week at down 6. 6 . And also looks like costs also lower, as well. Back the you. Thank you, susan. Shares up about a percent. Microsoft also just out with its earnings and those shares were popping higher. More now reactions from Julie Goodrich and tim lesco. Welcome, guys. You yeah, what do you think of microsoft about the quarter . Well, i think its better than we thought. It was certainly what we were hoping for. Were very excited about microsoft. We actually just took a position in microsoft at the end of april so we have seen quite a bump since then and continues. We also are excited about the linkedin connection and we think that microsoft may be looking forward and looking at the kinds of solutions that businesses, small and large need. And their purchase of linkedin is a sign of that. Tim, you had said the purchase confused you. What do you think about the quarter and that now . Well, were really happy about the quarter. Clearly last quarter was a pause in their switch to more Cloud Based Services so it seems like that business is back on track and growing well. Id have to say looking at forward earnings, that microsoft is still pretty cheap. And its nice to see those earnings accelerate. On the linkedin side, havent seen yet where they meet but i will share my coguests hope that it really means something for the future. Where do you think, tim, the strength is coming from in the quarter . You know, this is a markedly different outcome than after the last quarter. Well, you know, looking at all of big tech is making the move from traditional install bases into cloud bases and ibm seems to be stumbling as they do that. Oracle and microsoft seeing accelerations and big tech is finally getting to be part of the game of whats going on and Enterprise Services over the cloud and heartened theyre seeming to take the forefront rather than call it a fiveyear laggard in the business. Julie, is that why you bought in at what i presume the selloff after the last quarter . Yeah. I think what we are looking at, though, is the Tech Companies across the board and considering other things. Were considering their Enterprise Solutions but were also considering interesting things like, you know, women and minorities on the board, women and minorities in upper level management. Where is the workforce really going . And how can Companies Come to terms with the fact that this is this nation is changing and the needs of businesses, small and large, are changing. So, we agree that, you know, around Enterprise Solutions thats definitely the issue. But also, technology. You know, the actual on the Ground Technology is changing. You know, half the time were all checking our phones to see whats going on in the office. If we can go in and access as much data as possible because of the 365 platform i think we are in a better, much better situation. All right. Well, those shares up about 3 . Guys, thank you for sharing your early perspectives. Coming up, facebook reportedly trying to get youtube stars to jump ship. The company paying social media celebs for five broadcast and how facebook plans to generate revenue from the service. Netflix with the worst day since 2014 and not an executive producer of house of cards thinks the stock is a buy right now and why he would short it later on the closing bell. Welcome back. Big news out of two big social media companies. Facebook, first of all, a page out of rival youtubes playbook. Twitter, meanwhile, signing a partnership with another highprofile sports property. Julia boorstin with details on them both. Hi, julia. Reporter hey, kelly. Twitter announcing a new deal with the nba. The nba creates two new weekly shows to be exclusively on twitter. The first time original Live Streaming content has been made for the platform. Now, twitter wont get live game broadcasts but the nba will offer more content around its existing partnership. Including game clips and behind the scenes access. That both twitter and the nba can make money on. Twitters much larger rival facebook focusing on drawing premium content to its platform. Facebook paying 2. 2 billion to youtube, vine stars and internet personalities for alive content over several months according to the wall street journal. Facebook wouldnt comment on that exact payment dollar number and says in a statement, quote, as part of the early test program, we are working with these partners for temporary Financial Support to encourage experimentation with the new format. Facebook stressing it is not trying to lure over stars and rather its paying to encourage experimentation and at the end of the day, kelly, the more premium the content, the more premium the ad prices facebook and twitter will be able to charge. Back over to you. Thats the idea. Will it be work, jon . Sounds, kelly, like an oldification of new media. Contracts for new talent in not king it for free . Its really interesting. I think as the Business Models develop, it is going to get more and more like old media and seeing it on a number of fronts, probably healthy for people creating content. Kiss of death, mike. It is getting there. Starting to become recognizable to me. Time to sell put your bifocals down. Investment advice. Lets get back to sue herre herrera. About 192,000 pounds of pf changs home menu frozen chicken and beef products recalled. It is an expansion of an initial recall issued earlier this month after small metal shards were found in sugar used in the products sauce. The tappanzee bridge is closed after a crane collapsed on lanes in both directions and being used to contract the new bridge. The operator was rescued from the river unhurt and three drivers that swerved were injured and not seriously. The port of baltimore welcomed the first massive container ship. The supersized ship reached it through the newly expanded panama canal carrying nearly 8,500 20foot shipping containers. There theres no evidence of a link of Breast Cancer and in vitro fertilization. That is the news update this hour. Kelly, back to you. All right. Thank you. Republicans have heavily criticized dodd frank. Why are trmp and the gop talking about a depressionera law that could force the breakup of top big banks . Wonder who pays for a Political Convention . How do the millions of dollars spent . Eamon javers is doing deep digging in cleveland. Former new york city mayor Rudy Giuliani is here to discuss the presumptive end of the Never Trump Movement and the plagarism controversy of Melania Trump. Stay tuned. At the Marine Mammal center, the environment is everything. We want to do our very best for each and every animal, and we want to operate a sustainable facility. And pg e has been a partner helping us to achieve that. Weve helped the Marine Mammal center go solar, install electric vehicle charging stations, and become more energy efficient. Pg e has allowed us to be the most Sustainable Organization we can be. Any time you help a customer, its a really good feeling. Its especially so when its a customer thats doing such good and important work for the environment. Together, were building a better california. Your Business Needs Better Technology to drive better performance. So you need it to be reliable and fast. Really fast. Introducing the comcast business Summer Savings event. Fast Internet Speed to drive performance, plus cutting edge wifi for your employees and customers, and voice mobility so your calls find you wherever you are. Get some of our most advanced products at a great price with over 500 in savings. Call today and ask how to get these savings plus a 250 prepaid card. Comcast business. Built for business. Welcome back. Another record day on wall street with the dow up 25 to a new closing high of 18,559. The s p, though, lower by 3 points. Naz democracy lower by 19. That was more than a third of a percent. Lets get a check on names moving on earnings after hours, too. Microsoft beat but some focus on the tax line. United up less than 1 , thats United Continental. Reports circulating that donald trump missed a key meeting in cleveland today. Many past sponsors sitting the conventions out this weekend and eamon javers lookless at the money behind the convention. Eamon . Reporter hi, kelly. Welcome to progressive field. The home of the Cleveland Indians and today members of the montana delegation here at the rnc out here throwing the ball around. We also have a neil diamond cover band over here blasting away doing their thing so the delegates here in cleveland have been partying all week long. We have been to some cocktail parties and rock shows, outdoors and somebodys got to pay for this and the problem of the Trump Campaign and the Republican National committee have had this year is getting donors on board to write the big checks and traditionally you do get the big checks coming in. We looked at 2012 to see in that cycle who the big donors were. Take a look at the list of people that financed the convention that year. 5 million from sheldon adelson. A Million Dollars from paul singer of elliott management. I love this one. 179,000 in Beverage Services from bacardi usa and 100,000 from 3m corporation. What do they spend that money . As we have been seeing, theres a party aspect to any spind of Political Convention and last time 23,000 at burns steakhouse in tampa. 5,000 at Botanica International flowers and 500 at los blancos cigars. We have to see if they were able to get the donors to pony up the big buck this is time around and just Walking Around here, theres a carnival atmosphere, there is a party atmosphere, so things going very well here in cleveland so far. Isnt the party thats interesting about the individual donors who are financing this thing. I just assumed the Republican National committee did. Reporter yeah, well they raised they have the Republican Convention Host Committee which is a separate entity and it raises money to finance the convention itself and a lot of activities. You have the Republican National committee paying a piece and the Trump Campaign or the president ial campaign of whichever party paying a piece that year and the fund raising and the numbers i gave you from the Host Committee back in 2012 and thats what you are seeing this time around and the city is going to pick up a big tab here, as well. Theres a huge amount of expense in hosting this and having the delegates here. Oh yeah. Reporter the security package, a lot going on here in cleveland. Like a multiparty wedding or something. All right. Thank you. For now, eamon javers. Next guest rallied of Rick Santorum in 2012 and the cycle, too. Now throwing the support of donald trump saying hes the change that needs to come to the white house. Joining us now from the rnc in cleveland is Foster Friess, trump supporter, donor and founder of friess associates. Great to see you. Welcome. Im thrilled to be here in cleveland and honored to be on your show. Thank you for having me. We want to hear from because we talked about the big donors and big republican figures sitting this one out. Can you tell the public why youre throwing your weight an your money and your reputation and your support behind donald trump . Well, im a guy from wyoming and we ride for the brand. Not just the trump brand or the republican brand but for the american brand. And so i think we have to get everybody on board to realize whats at stake in the future of our country and three Supreme Court justices is just one issue. Donald trumps vetting more carefully. The syrian refugees. Securing the border. Having minimum wage decided at a state level. The things are pretty important. But i think really boils down to something more simple, frankly. Kelly. If you get invited to the white house at christmas, what would you rather have, a hand shake of bill clinton or a hug of me lany trump . Thats an easy decision. Tell me youre not basing this on wanting a hug from melania. Well, i put first things first, you know . Well, on that point, you wrote an oped saying that god sometimes works in Mysterious Ways and for people looking, you know, for somebody who shares their values, is donald trump the guy . Well, i think god has blessed me with a lot of success, kelly, because i pay less attention to a persons past and where a person is today and look at what he can become. And donald trump has incredible potential in terms of his growth as a human being and were fall a growth phase. You and i and everybody. So i think its exciting, first to see the decisions that hes making to pick mike pence as his running mate. I have known mike for 10, 12 years and you cant find a more honest, down to earth wonderful guy and indeed does share the values of all of us who have asked the lord to come in and take charge of our lives and so thats a very special pick for many of us on that track. Let me bring in the panel here. Mike . Foster, i was going to ask you, as a business person and investor, are there really tangible stakes here in terms of backing of donald trump that you think hell do something on a policy level, whether it be to the Financial Services industry or other actual specific business measures you will be looking for a Trump Administration to lead . Well, one thing hes actually said, i believe, basically wants to neuter dodd frank. I talked to people who said that those draconian measures gone too far to inhibit a lot of Economic Growth and one thing and obviously heard the positions on trade. I believe the Regulatory Environment pretty nasty. And so, im convinced he would never, ever ask the Little Sisters of the poor to pass out abortion bills and an example of government regulation stuffing down things the American Public that the American Public isnt too keen about so i believe there would be a whole series of Regulatory Environment changes and many things to dramatically help the economy, dramatically. Mr. Dpriess, a number of things mr. Trump said about regulation run against republican orthodoxy. Bringing back glasssteagall. Said things about trade a number of people see as protectionist and adding more regulation. Are you fine with that, or do you view it as some of the bad that you need to take with the good . Well, i am friendly with brian mulroney, the former Prime Minister of canada, 12 years, and he mentioned he was sitting with conservative friends, now, you have got to get tough on the conservatives, got to get the conservative principles implanted. R brian said i have to be elected first and put water in the wine and things to do to give the other side some sense of winning but look at glasssteagall on its own merits and the changes he wants to make he wants to make im not close to what they are but i think they could be some good ideas in there and all regulation isnt bad. We do need regulation. I enjoyed being in the Investment Business because of the securities and Exchange Commission and without them wouldnt have been a good environment. I was going to ask for stock picks, too. Well save that for another time. Thank you for joining us. Im delighted. Nice to see you all and god bless. Thats Foster Friess on the floor of the Republican National convention in cleveland, ohio. House of cards, one of netflixs hit original series but is the stock poised to fall like one . A tesla driver was involved a fatal crash. Leaders of the transportation and Tech Industries are meeting today to discuss how to move forward with limits on automated vehicles. You are watching cnbc, first in business worldwide. Todd spaletto, president of the north face, we are working on the prototype to match customers to gear. Watson, lets give it a try. Say its midjune and im backpacking in yosemite. Of our 353 jackets, i can recommend nine. Watson, what if it rains . There is just a 3 chance of rain, so i recommend the breathable stretch fleece fuse form dolomiti jacket. A Perfect Choice watson. No wonder our Customer Loyalty numbers keep climbing. I believe we can do even better. I like the way you think. Lack back. As the national Highway Traffic Administration investigates teslas auto pilot system, theyre meeting to figure out what limits should be placed on selfdriving vehicles. Phil lebeau has more. Hi, phil. Reporter hi, kelly. And the most important thing that came out today hearing from the transportation secretary fox is that the guidelines being put together by the federal government coming to Autonomous Vehicles will be finalized this end of the summer and in terms of what we can expect, a couple of things, one, more Public Education in terms of how people will be using these systems in the future. And in terms of the suppliers, the tech firms, the automakers developing the systems, Great Technology says secretary fox but they have got to learn to work with the regulators. Youve got some really smart people out here who are really thinking about how Artificial Intelligence can improve safety on the roadways and we want to encourage great, new thinking about that. But we need to also recognize that we have 50 years of experience with vehicle safety, within u. S. D. O. T. Our experience actually does count. Reporter secretary foxx would not comment on the tesla autopilot investigation and a quick note regarding tesla, elon musk said hes working on the master plan today and tonight so i think, kelly, were going to hear more of teslas future. Kelly, back to you. Thank you. Phil lebeau out west. Up next, after a short break, former mayor giuliani joins us live from cleveland. Stay tuned. Foand millions moremericans lwho feel its effects. S, lets walk together to make an even bigger impact and end alzheimers for good. Find your walk near you at alz. Org walk. We say thank you to every Police Officer and Law Enforcement agent whos out tonight protecting us, black, white, latino of every race, every color, every creed, every sexual orientation. When they come to save your life, they dont ask if you are black or white they just come to save you that was former new york city mayor Rudy Giuliani last night at the Republican National convention. He joins us now live from cleveland along with cnbcs senior contributor larry kudlow. Welcome to you both. Mayor giuliani, first to you, i mean, talk about fired up. If it wasnt for me lany, this would have been the talk of the day. Was this, you know, were you taking a stand . Was this more than just a speech . Was it really meant to sort of change the rhetoric in this cou . No, no, no. Ive given a speech like that or speeches like that quite a bit. I believe that for the last year and a half weve had an atmosphere in this country thats very antipolice. I think it starts at the top. I dont have to outline all the times that barack obama takes positions where he makes tremendous headlines over alleged police injustices, and some are, but the ones that then turn out to be justified like the people that are now being acquitted he says nothing about. It goes right down through his attorney general and down to that District Attorney in baltimore whos a disgrace to District Attorneys. To the people in these black lives matter demonstrations who yell kill the police. All of that, all of that i believe has led to this slaughtering of our police and the culmination was baton rouge when these two these Police Officers were called to the scene of a possible crime involving a black woman who was going to be victimized and they were ambushed and killed. So if you dont have emotion about that, im sorry youre not a human being. And look, you were responsible with your Police Chiefs to turn new york around. You gave us new yorkers Public Safety for the first time in many years. Just an angle on that, were a business show, i have other questions for you, but Public Safety is like a tax cut. If youre not safe in the streets, businesses arent going to come here, shoppers are not going to go out on the streets. And i think thats one of the consequences of what appears to me, mayor, to be this era of lawlessness. Well, two years into my administration there was an article im sorry, a letter, the times would never write this article, a letter to the New York Times from t a man thanking me for cleaning up new york so he could send his son to columbia where he had graduated from because he never would have sent his son to columbia under David Dinkins or ed koch. When i left, 550 murders. Mayor bloomberg got it down to 340. So senator tim scott, republican, okay, a good thinker, hes given a bunch of speeches. He said basically there is today a deep divide between the black community and the police. One, how do you react to that . Two, how do you deal with that . Well, you deal with it by dealing with the underlying problems that are creating it, which include lets start with education. An educational system that is failing poor people, including africanamericans. How do you change that . Choice, charter schools, who opposes that . The democrat party, the liberals, Hillary Clinton. You deal with that by doing welfare to work like i did. I took 600,000 people off welfare. I got jobs for 500,000 of them. I required people on welfare to work. Not because i wanted to be cruel to them, because i didnt want them to become dependent. Obama has doubled or more than doubled the number of people or food stamps. He is creating more and more dependency. So if you look at a city like baltimore, controlled by democrats for 50 years, the place, according to the representatives of baltimore are why is this place never been changed. You know why . Because it is following democrat liberal policies of victimization, dependency and lack of respect for Law Enforcement. Kelly, come on in. Mr. Giuliani, let me ask you, if i could, about the broken windows approach, going back to what you were talking about, your track record as new york city mayor. Theres lots of scuttlebutt about lets say theres a Trump Administration and youre Homeland Security secretary. How would you bring and apply an approach like that nationwide . Well, what i would do nationwide is to train our 800,000 Police Officers in looking for the precursors of terrorism. This is something this administration hasnt done. The fbi is very small, its only 14,000, 15,000 agents. The people who are going to discover the terrorists of the future, the ones who are going to attack us in the future, the lone wolf and the others, are going to be homegrown and youre going to have to look for the clues and youre going to have to follow them up. For example, when the russian government told the fbi that tsarnaev was a terrorist, the fbi followed it up, came to the conclusion he wasnt, probably put it aside because they didnt have the resources and never turned it over to the Boston Police. Under a Trump Administration, that wouldnt happen. That would be turned over to the Boston Police because the Boston Police could follow up on that. I can give you many examples like that. Each one of these murders you have seen, these terrorist murders that youve seen, each of them had factors that Law Enforcement should have followed up but didnt because there isnt the proper coordination between the washington government and the local police. It is part of the dysfunction in washington that donald trump is running against. I just let me follow up on the terrorism thing. You didnt quite argue last night of the need to have a formal declaration of war against isis and related terrorist groups. Now, mr. Trump has said if elected he will have a formal declaration of war. Ive wanted it for quite some time. In radio interviews Henry Kissinger and george schultz, they want a full declaration of war. Would you be for that . Im surprised you didnt mention it. I said im for unconventional victory against them. Sure id be in favor of it. But i dont want to wait for a declaration of war. And then we have to make good on the promises, thats what schultz said. Youre a reagan guy, im a reagan guy. Youve got to make the promise and blow out their safe havens. In other words, take the battle over there. Theres only so much were going to do here. That is what i was saying, we should declare that we want to have unconditional victory against them and put them on defense rather than having them on offense. If that includes a declaration of war, then lets have a declaration of war. Americas mayor, Rudy Giuliani, thank you. Kelly, thank you very much. Really appreciate it. Thank you guys. Appreciate your time. Larry kudlow, Rudy Giuliani. Were just about half an hour away from microsofts conference call. Well get a check on the stock and set you up for that when we come right back. Narrator adventure can be found anywhere but the best place to start is in the forest. Kubo i spy something beginning with. S beetle snow. Kubo no. Beetle snow covered trees. Monkey nothing to do with snow. 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In means getting more from your Home Insurance with an expert allstate agent. Its good to be in, good hands. Welcome back. A fivesecond final thought with our panelists here. Microsoft is up 3 . I want to see the reconciliation between gap and nongap. The gaap results not as strong as nongaap. Looks like a slight upside because of microsoft tomorrow. Thank you for joining us here on closing bell today. That does it for us. Fast money begins now. Here it is, this is fast money starting right now on cnbc. Life on the nasdaq market, overlooking new yorks times square. Our traders on the desk are pete najarian, Karen Fineman and garen adame. We have a top marketwatcher who says trump will be a disaster for the banks. Plus netflix shares having their worst day in almost two years but the analyst who says the stock is a must own is here to defend it. What does he that others dont