Stopped short of calling them a pyramid scheme, what ackman hoped for. Said it would happen, the stock would go to zero. That language avoided and herbalife tried to frame it as an upbeat resolution for them. Heres what he had to say. They chose 0 negotiate a settlement with the harshest the ftc ever had against a pyramid xwee scheme. Misleading the market about what the ftc ultimately concluded. We think its a nice try, but its the herbalife, shut down by the ftc. They just havent realized it yet. Very harsh words from ackman but he went a step further. Accusing herballife, manipulating its stock, attempting to, planting stories with the media positive early friday morning before the markets open and before this ftc settlement was officially announced. Perhaps, although stopped short of saying it directly, encouraging carl icahn to speak positively and before all the facts were known and before the context, as he sees it, at least, of this, everything short of calling it a pyramid scheme findings were released. Reports that he is maintaining his short position, not going anywhere. You get the feeling from the headline that you just gave us hes going to be just as loud as he has been over the last few years into the future until he gets the resolution he thinks that should happen . Thats certainly what he seems to be building up to. Now, when i jumped off the call moments ago, he hadnt outright said that. How long his patients would last or the infamous billion dollar short and talked about the cost of carry on this show recently. 20 million per year and tied up 10 of his capital. 12 billion at last check. Certainly a lot of psychic energy into this as well as a lot of capital. I would be shocked if he gave up now. Were waiting as well. Reached out to herbalife, given what mr. Ackman said on the call. Yet to hear back from the company. You hear back or we do, certain to bring it. Did he say anything about how this investors this was an investor call, correct . Did he say anything how his investors are feeling . Where redemptions are . The state of the. He absolutely did. Fortune magazine dotcom, talking 600 million investments through june 30th. Could be regarded as reaction to setbacks with valiant, significant, not at least to the most immediate news on herbalife. He characterized these in historic context. Heres what he said on that. My guess is that our redemption is that weve received capital among the lowest in the industry and thats really because we benefit from a very stable capital base because our investors have been incredibly supportive of us and we appreciate that support. You know, ackman went through, scott, some of his highest redemption periodsy saying in that context as a percent of a of capital, this year counts as the sixth largest redemption period in history. Often after a good year people decide to take gains off the table as opposed to immediately reacting to bad news for a hedge fund. That said, he has an eight quarter redemption policy. Those redemption requests while they might note them now would take a while to play out. We know youll stay on the case. Always do. Kate, thanks for being here. The latest there. Get to the markets today hitting record highs as we said yet again and the question on many investors minds now, whether there are more warning signs or buy signals out there for investors. With us today for the hour, jim lebenthal, stephanie ling, josh brown anden pete emergennajaria. There are high levels of catch on the sidelines, bond yields as record lows and global uncertainly. More warning signs, or buy signals . The buy signal already took place before the new high, which was the bread thrust. We talked about that here. A huge broadening out of stocks that were working. I think people still have the narrative its really only the dividend stocks and the quote unquote low volatility names that led, but thats now a stale narrative. Its changed. Look at this weeks the xlk, s p 500 tech names up 1. 65 leading the market. No other sector is up more than 1 . When you take a look at s p high beta as a ratio shart versus s p low beta, thats now on the verge of breaking out. Meaning, value managers are putting money to work in the sectors that couldnt get arrested in the First Six Months of the year. This is a new development. And if you do get leadership from cyclical stocks selling at 11, 12, 13 times earnings in a Market Selling at 16, 17, thats a new ball game and were seeing it on screens now. Pete, part of the narrative today is that investors are finally growing more bullish . That a rally that has largely been quote unquote hated for as long as we can remember, is finally getting love. According to investors intelligence, bulls moved up to 54. 4 from 52. 5 a week ago. Both counts high since early 2015 when bulls peaked at 59. 5 . People getting more bullish, the evidence seems to suggest. They are, making you uncomfortable. Finally getting more bullishs here we are after a big run. If you go back to that lows we had postbrexit, incredible run. To joshs point, talks about the tech. Hit on that a little more. Looking for value. Looking for dividend yield and also looking for growth. They get all three of those in tech. Gotten through a few names already. Look at microsoft numbers last night. Impressive. Showing where the growth is. Pc, even pc wasnt as bad as expected. Because of that you see where that stock is today, but were seeing that across the board in various sectors. Seeing health care what a great run weve had out of that. Look at intuitive surgical. A name. Look at growth. Sold more devices than last year by 12. These devices go, the da vincis, for a million and a half dollars and beat last quarters numbers as well. Health care is working. Technology is working. One thing i think was why this rally was hated so much, what was working previous to this . Utilities, they feel a little stretched. Telecom. Feel a little stretched. Now youre starting to get other valuetype areas of the marketplace participating. Steph, warning signs or buy signals . Dow is over 18. 6 as we speak. At the highs of the day. Vix near a oneyear low. What is it telling us . Should we be worried . Should we be buying . I think you have to be mindful whats going on. Right . I mean, sure, valuations aralities stretched, but so Interest Rates are actually quite low and it does seem like they will stay lower for longer. Even if the fed does raise one or two times in the next six, eight months or so, even if its four times, rates are staying lower. Valuations could actually expand multiples can expand, because of those low rates. But i think more importantly, scott, its earnings. So far so good on earnings. Across the board. Maybe so far not so bad. I would say, good. 75 rate extraordinary. A high number. Its not just the bottom line. So far were seeing actually revenues beat. Now, maybe thats a function of expect acations coming down. Totally give you that. Theyre beating those numbers not making the numbers. Thats very important. I also think to both of the guys points, cyclicals are much cheaper than defenses. Tilt the portfolio that way. Mike santoli at the New York Stock Exchange today. What do you make of this conversation in this debate i think is going to grow more loud as the stock market stays at the levels that it is . Yeah. I think i see basically five strands to the bullish argument that have almost working in sync, up 20 from the interfebruary lows as of todays highs. Those five things i think unusually have all been working together. Fundamentals, you hit on this. Obviously the earnings picture trough, better rapidly and index working in favor. And a green light, josh hit on that. Three, six, 12 months. Sectors have given up the leadership but still working and people still want the yield. Still have a gap with treasuries. Fed, of course, how long is it going to remain sidelines . And that was part of the argument here. I dont think thats the case. Short term Trader Sentiment has perked up. Longer term maybe too defensive. All these things friendly and justify where weve gotten to. Each case, up for a test sooner or later to see if theyre going to work from here. Jimmy, looking at notes. People say overly bearish to mikes point. A contrarian indicator now. It is. Not a contrarian indicator brought it up twice, the vix. The index, look at a one, five, tenyear chart sdshs not go lower than this. Usually spikes back up. That means youre headed for correction. Put it together with what steph and everybody else says wait. Saying that vix at 11 and change is a sign that weve got a big correction coming . The way it usually works. No. Could be a 2 selloff to take the vix to 15. Not a direction. 10 plus. Not necessarily enough to get it up into the teens. Tying it in, another week and a half of the heart of earnings season now. Not just earnings, more likely than not the next week and a half this market goes higher. However, dont ignore the vix. Anytime its gotten this low, its bounced higher. Something to be aware of. What do we make of the vix . Incredible level. Were all probably surprised where were looking at it now, scott. Buy signal . Warning signal . I think warning signal and something you want to use the vix in your favor. What i mean by that is, stock replacement strategies work for those that dont have constraints about taxes and so forth. Getting rid of stocks now, replacing with options, to continue to ride the movers moving to the up side and through earnings season seen a lot of different names. Pepsi, alcoa, microsoft, jpmorgan. Different financials reporting strong numbers. Look right now and its a great opportunity, if you want to stay in. Either to protect or to shift into a stock replacement. To petes point i add, the way amateurs use the vix when it spikes, they take risk off, because they think its going to get worse. Right. The way professionals use the vix is exactly to petes point. If we get a spike, thats where theyre looking to add exposure, if they believe were in an uptrend. Or a breakout situation. So i would just use the vix sparingly. But use it as contrarian indicator, without a doubt. Positioning for a pullback . I am. In our portfolio, we run for clients, had one stock taken out in the last two weeks. Private equity buyout. Havent put that cash to work. Trimming high fliers. We have about 11 cash in our allstock portfolio, positioned and looking at the vix. Hearing what youre saying, insurance and really, really cheat now. Seriously considering it. The portfolio the guys jon and i manage, wealth management, 30plus in cash now because of this move and opportunities to take some off and looking for opportunities to get back in and just not seeing what we want to see. When does the cash need to find a place . If cash is at highest since november youre always looking. Even right now at these highs of the s p. Still looking for opportunities that might be out there, scott. There are some. We just have to look a little bit more deep right now than we were looking just a couple weeks ago. Postbrexit, there was plenty of time to look for opportunities in the postbrexit on some of that stock. Issue, you run the risk missing what could be a substantial move in the market . Absolutely, thats the risk. Why were at 11 and not 20 . Having said that, be patient. Names like nike. Down below 50 last earnings report. 56 or so now. One wed like in the low 450s ad buy it. Be patient. A week and a half left of the earnings season now. That earnings season is positive for stocks. Im not chasing stocks here. Still got 89 invested. Looking to put it to work, i want earnings season to come to an end first. Usually have extra cash around earnings. Lie like blowups and able to buy on the dip. To petes point, 30 cash, your clients, maybe those blowups dont last that long and dont go that deep. Im looking at companies delivering. Johnson johnson, jpmorgans i dont mind paying up for them. I dont. I know that the visibility is there and as long as valuations are in mine framework where im comfortable with, im okay with buying some of those, too. Mike, the last word from the floor. Global uncertainty is on our list of warning signs or buy signals. How do you read it . Weary of or to say because of that uncertainty, thats whats going to give the u. S. Market the ultimate boost that its been waiting for . Global uncertainty. The backdrop. Rallies dont require all the worldss 1068ed to tosolved. Its an upward bias the next few months but tests along the way. Maybe next weeks fed meeting. Maybe the dollar rallies too much. Whatever it is, i dont think the cushion is as big as youve talked about with the vix where it is. Mike santoli on the floor. Thanks. Bertha coombs has a market flash. Right, scott. Despite reports that the doj seems prepared to block the aetna humana merger, a source tells me its not a done deal yet. Negotiations and discussions continue. In fact, at humana, a meeting, in talking with the doj as recently as this morning, the two firms have identified the vest chu vest ta chures that will ease and signed contracts with viable operators in many of those markets. So at this point they continue to believe that those discussions could prove fruitful. If, indeed, the doj does move to block the deal, this source says that aetna is prepared to defend its lawsuit on day one. So they will go to court to defend the suit, if the doj blocks. But it is not a done deal yet. You can see humana shares have been moving up as this news has begun to circulate. Back to you. Not to mention, bertha, so has aetna. Steph, both on the move. How closely are you watching, given you own United Health and are a player in the space . I would hold on in United Health. Theyre not involved in this craziness. I dont know. None of us know what the outcome is going to be, but it seems like aetna humana has a better case getting approval than the anthem signal transactions. But aetna will do whatever it can do get humana. Gets blocked and aetna sues, wow. Looking at next year a kind of approval and thats a long time to wait. I would be more inclined to hold on to united. I would buy some cigna, i do think the mid120 stock is attractive on a valuation basis, on a standalone basis. A look. Up 1. 25 . Next up, an analyst saying the next driver for apple will come from a very unlikely source. Well reveal it. Well speak to the analyst. Were back in two. My name is Valerie Decker and im a troubleman for pg e. I am a First Responder to emergencies 24 hours a day, everyday of the year. My children and my family are on my mind when im working all the time. My neighbors are here, my friends and family live here, so its important for me to respond as quickly as possible and get the power back on. Its an amazing feeling turning those lights back on. Be informed about outages in your area. Sign up for outage alerts at pge. Com outagealerts. Together, were building a better california. Welcome back to the Halftime Report. By now youve probably heard about pokemon go. If youre not familiar with the latest app store craze, we got you covered. Dont worry. The phone game using your phone. The goal catch all the different types of pokemon. So what could this be worth to a company like apple . Abouts 3ds billion in revenue, according to needman company. Bring in the analyst behind our call of the day laura martin joining us on the phone. Welcome. Thank you very much. Interesting note. Certainly piqued our interest. Made it our call of the day. Note investors are looking at on apple. 3 billion incremental from pokemon go over the next 12 to 24 months. Who would have 245u9 . True. Only in the u. S. Two weeks already 21 million active users. More than candy crush biggest game of alltime achieved at its peak two years in. How can you model something, you said, only here such a short period of time . Still trying to get our arms around this whole craze nktsz sure. So the way you model it, look at, we have numbers of daily active users and daily active spending on ios devices. The answer, average user spending about 16 cents a day and we think apple keeps 30 of that, through the app store. So if you take 5 cents a day, we assumed half of the total users globally. Would be the level it hits at peak. Half of the candy crush user, conservative, and at that level you get to 3 billion of revenue to apple. And at a sort of aftertax, that translates into about 40 cents a share or 4 a share in value added to apple from pokemon go specifically, upexcludeing from the next some our genius in california makes. How do we know its not short lived . Ngts maybe. Candy crush two years. Ill take that for applefi appl. Fine with me. Nintendo has gone up 20 billion and they do have a. P. Risk. Apple does not. Its hedged. The next genius with a hit game, apple shares in that, too. This mayen transitory, apple has a future in all over the ios platform. Hi, laura. Josh brown. You have caught squirtal yet . I havent yet. But i saw pokemon yesterday, but he escaped before i caught him. So serious question. Is nintendo, its been pretty clear now, finally, after ten years, that they are going to embrace mobile, and that there will be more titles forthcoming, including maybe some longtime favorites. That do have potential positive be multibillion dollar blockbuster games. Should that now be thought about in the context of ios and apple, or could we be years away from a zelda or a super mario brothers mabel game on the platform . Look, every kid, clever kids dream drop out of harvard and make a billion dollar game. These guys did it. I think lots of innovation. People trying to be overnight billionaires. The important number for apple is the billion installed base of user with an average hold period of eight years. How long people stay in the apple ecosystem. Apple participates at the 30 level, no matter which genius creates the next hit game. I cant get past at least somewhat laura, the fact this market as weve mentioned overall is at an alltime high. Dow above the 16. 8. For or 18,600 for the first time and yet apple is below 100. Or knocking at the door. Still seemingly cant get a lot of momentum going. Can you really convince people to buy apple today, because of this pokemon research, and the outlook for that, versus what really matters to people, and thats more innovation when it comes to the phone and what the expectations are for deliveries for a new device . Well, i think part of that reflects at 40 analysts that cover apple are hardware analysts. Our perspective is a little different. We highlight apple has higher Profit Margins than the Walt Disney Company and higher returns on capital than facebook. Therefore, the notion it should be valued as a Hardware Company just because it makes phones is flawed. Those margins are only achievable because it does have ecosystem benefits like pokemon go throughouts ecosystem, much higher margin and much more live like a cable industry model, almost a subscriber type of model. Not just a hardware point of sale model. We have a differentiated point of view.