Considering a Corporate Tax cut to help that line. And uk housing data and german sentiment. As for the road map, it starts with the jcpenney ceo bill ackman resigns. And yums sales in china is an important market falling more than expected in july. And pc problems with microsoft downgraded by stifl nicolas, and is the stocks bull run coming on an end, and forget the planes and trains and automobiles, because e lon musk is out with the hyperloop. Put it out on the interneshgts a internet, and it is cool. It is cool. And wouldnt you love to be ahead of the chinese on something. Yes, lets go out there and reach for something. And musk is not settling on the chinese got ahead of us, and he is leapfrog, and we should call him leapfrog musk. Or pylon man. And we want the start off with the news that we want the cover since it was announced Hedge Fund Manager bill ackman has been pushing for changes at the top of jcpenney has resigned from the store. He runs pershing, and formally named the board executive ronald tysoe to the board. And he is going to give up to mike ullman and both of them have been said that they should both be replaced posthaste as it were. This is a fascinating story, and not because we are focusing on pen nee and penney and the trouble, and for part of ackman pushing for ron johnson and the board not et going the way when they a wanted a ceo chosen bucks the fascinating change of the founder and the ceo of the board resigning. Did he impart this to the shareholders and the board . No. One reason that Howard Schultz has made this point is that throughout the time line, there is no recognition that 116,000 people work in jcpennys, and the sales have dropped, because of no stability on the top. I have been on the fractured boards and been on a fractured board and i can tell you what happens the product and the company suffers. It is time for this change to be made. David, does it make it easier ultimately after he does not have Insider Information to blow out of the position . Yes. It makes it easier, and one has no idea if he will, and the position is not a positive one for him at this point, but perhaps he will choose to quiet down and not say much, and let the board do its work and for its part, the advisers to the board are saying, listen, right now the board is focused on stabilizing the company, and the next reported quarter that you get, that is the last johnson quarter and the last one they will say, okay, that is the old regime and you have back to School Coming or the midst of it and the Current Quarter is the first one where they will lay the groundwork for saying we are making progress and getting back to the old jcp and ullman is the man to do that and we start eed search for a potential replacement, but it is the same way as p g, and a. J. Laughly is in but we will find a new guy for the long haul. Housewares business which is keystone to johnsons plan and it is jump ball. Nobody knows where it is, and they are bringing back the private label, but one thing i have learned about retail is that when the customer leaves because the customer doesnt like it, it does not change they dont come back. You go the macys, and you say, hey, macys has coupons and lundgren with good stuff and the vf corp and the name and the north face and the best pvh and why do i have to go to that place when i want to go ak skroz the street at the mall . Those people are hard to woo ba back. It is different if kohls and macys and target were screwing up, a la best buy, and they make a comeback, because there is nobody else. The other companies have gotten stronger and not weaker. I am calling it the mcguffin is like hitchcock, because it is lack of leadership. And we dont have a leadership problem, and we have ended the struggle here with asking mr. Ackman to resign, and he did. So they have a business problem, and you are getting to that. David berman noted hedge fund retail manager followed that he is negative and many others, and i hear it from you of the fact of alienating the Customer Base and then moving to the position to get them back, can you pull it off . I have never seen it. They have been saying since they had the minus 30 comp store, and he was 29 and not 30 turned, and when you have that comp store decline and they have way too many employees and it means the wrong merchandise and you cant recover, and i have never seen a company recover and this the merrygoround and those who have mrg, and they came up with a comep number like this, and it was the end. And theyed a very good numbers and not on the scale of skrshgs c pennies b there are number s that you can come from, and we will talk about yum, and others that you cant. And we remember remarking down 30 , that is is not something that you can potentially come back from. That is like a quarantine, dont shop here. And tackman and we will talk about the ackman point, and it seems that the actions are almost part of a larger let me see what i can do i know what he needs for the herbalife short. He needs to join the board. Join the board. Yes, with carl icahn. Bingo that by the way, televised live would be fun. Lets get to yum, and jim mentioned it. The stock is falling in the premarket, and the maker to pare parent . What are they . The parent of taco bell, and kfc and pizza hut. They fell 13 which is steeper than expect and yum which operating more than half of the profit from china has been trying to overcome a food scare there, and you have been positive on the management of david novak, but this is somewhat unexpected. Yes, i own it with the Charitable Trust, but what people need to know is that who often controls is the last guy who talks. Merrill lynch came out to tell you that this problem is done, and that set the expectation, and drove the stock up to 74 and my Charitable Trust is buying it and why . Because the expectations were behind and novaks ha never said that this is going to be solved in the second quarter. And he never said it would be solved in the third quarter, but he said a year, and the street got ahead of novak, but he is for real. And novak is for real. What do you do . Look, i didnt like the numbers and a setback. I was looking for china and the samestore sales to fall at a fraction and, geez, i was they fell 13 and i thought it might fall half of that and kfc, itself, we are talking about 10 drop in july and the comp, but it was the pizza hut that shocked me. I thought that pizza hut should have been much better. And pizza hut is not associated with the bird flu problem. That is what bothered me, hold it, no, wait a second, it is not the mozzarella flu. Something more similar. Not the tomato sauce flu. Anything wrong here . No, things got ahead and the comp numbers, the projections were too high. I think that the projections at the last minute, the consensus got too high, and kind of an apple situation where the consensus kept growing and growing and growing and you could not deliver, but i believe it is temporary and i want to go back to what novak promised. A q by q4, the drama would end to a close and we are not in q4 yet. No, we are not. Over the microsoft, the shares up 22 if you have not noticed, but now the firm is downgrading it saying that the heightened pr pressures and the marketing expenses could be headwinds to microsofts coming years and not just coming quarters. Wet have all remarked on the enormous runup on the price of the stock in early april and i have mentioned many, many times the presence of the hedge fund value act and who is in the process of trying to secure perhaps a board seat, mchubbin, and could be an important voice to argue for changes in the company. You had a restructuring that took place, but no cost savings associated with it. The one microsoft and the one ford. It is like penney, david, because you is a giant infrastructure and the product of sales, and we are talk asht windows, it is big and done. So it is not a blackberry situation, because they have a lot of cash. And they have a lot of other businesses and the Enterprise Businesses and people talk about that and the plumbing business for so much of what is going on in the Technology World that microsoft is a part of and has much more predictable cash flow characteristics. But this is a p. C. Company, and i like the entertainment division, and windows with gigantic margins and they can raise the dividend of the stock again getting ahead of itself. I dont want to write off microsoft, but you have to have more catalyst, and the catalyst is the value that you are talking about. Yes, but how much of it is on the in the stock already . It is a huge position for any fund so to speak, but the percent of microsofts outstanding market cap is nothing, although he can potentially do this, because there are a lot of shareholders who are looking for an opportunity to have their voice heard. At the same time, apple is a tablet and cell phone company, and microsoft wishes you could have a tablet and cell phone business and samsung led the way for a lot of companies, didnt it . Yes, but when you come back to valuations on the name, and looking at the report it is trading at 12 times the calendar year well, procter at 19. Yes. 20 times. And General Mills 18, and it is not like they woke up and figured to have a better cherrios that works better on the cell phone. This is not the Growth Company of the 19 l1980s or the 90s, but 12 times . How do you argue there . A lot of downside. This is a market that loves growth. Unless microsoft got into burrito business and im talking about food with integrity the market wants open table to merge with facebook and then you ccan be on the cell phone and get a better table. We dont want inwith e dos, but table reservations. I thought i could use open table already to get that reservation. No, that is up. Dont you yelp . No. Get yelping. And they had a good quarter. And groupon, had a very good quarter. Not too early to buy it. And retail me not means sale, and just the symbol alone. Microsoft needs a new symbol. The big m. And mr. Softie, and remember they had it for so long. And macys, and a trade, may them some money or cash and player to be named later. These are yesteryear companies and palepaleosaic tec and now there is a revolution to unload transit in a new way. He calls it the loop system. Can you really go from new york to los angeles in half an hour . And the golfer coming off of the biggest win of his career, and we will talk to the pga championship winner jason duffner, and looking at the futures again, we are looking for and up opening today. More squawk on the street coming right here from post 9 at the nyse. [ male announcer ] here at optionsxpress, our clients really seem to appreciate our powerful, easytouse platform. No, thank you. We know youre always looking for the best fill price. And walk limit automatically tries to find it for you. Just set your start and end price. And let it do its thing. Wow, more fan mail. Hey ray, my uncle wanted to say thanks for idea hub. O well tell him i said youre welcome. 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Elon musk unveiling a new plan to cut the travel time from San Francisco to los angeles to 30 minutes and the price would be less than an Airline Ticket and he hopes that someone will develop the concept, because he doesnt have the time and adding that he is too busy running electric car tesla, and rocket manufacturer space x, and i have no idea if we will see it or if it is possible top ha, p happe it is nice to see somebody think big. I remember that in this country, the think birk and the late steve jobs was working on the car that ran on water, okay, because he thought, what are the big problems on earth, and this is the kind of thing that i would expect from the chinese and dont expect it from the United States. Which is a terrible thing to say in a way, because 25 years ago nobody would have said that. We expect it to see it from the chinese and not us. Because the chinese are trying to the figure out how to cut pollution, and took our jobs and now they want the make sure that they are not poisoning themselves. They have 1 Million People who are going to die of respiratory ill innocence china. If you called a banker right now and said, i need to do a hyperloop, they would throw money at him. He could raise money for this . Yes. 8 to 10 billion . He could raise it. You see 800 miles an hour, and you need to build a lot of pylons to do this and no electricity runs the and some of of it are based on the theories of tesla, the original tes tesla. The edison opponent, and theres not a plaque or anything, but mo green. And run it down the middle of highways perhaps . Yes. And something if we were to see the light of date would be transformational. And solar city has been a big win and so overshadowed by the incredible win that is tesla, people want to back this man. I think that the man by the way is loved. We all, and there is if you were in our position, you get ten emails a day saying why tesla should be a 4 stock. Okay. Memo the all of the people who think it is a 4 stock, go drive a tesla. You will have to pry me out of one the next time. He sent one for us to do a test drive. David, i dont regard myself as a great driver, but when i was behind the wheel, i have to tell you you were a great driver. Yes. Well, you are not known as a great driver, but a very good driver. Yes. And we will get you aheadf of the opening bell, and mad dash is coming up next as we count you down to the open. Here at fidelity, we give you the most Free Research reports, customizable charts, powerful screening tools, and guaranteed 1second trades. And at the center of it all is a surprisingly low price just 7. 95. In fact, fidelity gives you lower trade commissions than schwab, td ameritrade, and etrade. Im monica santiago of fidelity investments, and low fees and commissions are another reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. And this is my home team. This is my large lecture hall. This is my professor. And also my coach. This is my booster club. This is the guy whos graduating ready for a great career in technology. [ male announcer ] in 2012, 90 of Devry University grads actively seeking employment had careers in their field in 6 months. Join the 90 . Learn how at devry. Edu. Dont be so quick to walk away well, we have 7 30 before the opening bell and that is more time than usual, so lets do a couple of stocks on the mad dash and start with eli lilly. Well, david we all have become quite used to biotech developing fantastic anticancer drugs and that is what we have seen and why celgene has been so fantastic and gilead has great franchises with hep c, and now lilly comes out with late stage four cancer and this stock comes alive, because well, lilly had a good quarter, but they have been making the numbers with the cost control and the alzheimers drug didnt work, but when all pharma has a good number and drug and yield, you will get this. Now, do you sell lilly . The pattern has been that lilly announces something big, and then it drifts back, because the needle to move big pharma is so, so impossible. So this is a cheap stock and if it went to 54, im buying. And now are we going into a new aer ra of innovation rather than patent protection of introducing a new it ration of a patented drug . No, they are cutting, cutt g cutting, cutting, and outsourcing the tests. J j, and gor ski said we are spending billions to test the drugs and lets hand it off to the guys who can do a test for much more quick ly and easily ad inexpensive. So i am saying that big pharma has been dormant, but they have a lot of stuff working, but a lot of it is harvesting the last stage stuff and not do the basic. We talk about how the big market techs are going to have gilead. Lets move on the bp. Everybody has to recognize that dudley who is the ceo, and people feel that he was snookered by the u. S. Government and micking a big deal with the justice department, and while the ink is the drying, the epa sue sues him. He has full page ads saying, what do we have to do to please louisiana . There is a lot of feeling behind this by tort, and by tort lawyers on the defense side that this company is going to be asbestos, out of business, and they have to raise the reserves, but maybe a growing feeling that they were had by the court. And saying yes, yes, yes, to everything in the hoping that in this point they would be in the clear. They bougtd no goodwill that i can see, and they have tremendous assets and good dividend and better managed than they used to be, and they sold properties that did not hurt the production a la the big guys, but david, it is now a binary stock on a lawsuit. T