tv Closing Bell CNBC October 23, 2015 3:00pm-5:01pm EDT
thank you very much. just a reminder, we host the next presidential gate wednesday life from boulder, colorado. there is two debates, the small one and big one. >> and also fed day which is huge for. >> you yes, it is. >> hello. >> thanks for hanging around. >> i hung around. i enjoyed it. thanks for watching, everybody. >> "closing bell" starts now. welcome to the "closing bell," everybody. i'm kelly evans at the new york stock exchange. >> i'm scott walker in for bill griffeth again. the nasdaq the biggest leader today, the tech heavy index being powered higher by strong numbers from amazon, google and microsoft. we will break it all down for you coming up. >> now the pressure is on for apple next week, the iphone maker set to report its results come tuesday, we will debate whether the tech giant can beat expectations. >> and china cutting interest rates for the sixth time since november, we will discuss the
impact on commodities and talk to a money manage who are just got back from asia for the view from the very front lines. >> and it's not just tech companies, royal caribbean also topped estimates, the stock up more than 50% over the past year, up another 3% today and the ceo will join us exclusively coming up. let's begin with our josh lipton on this huge tech surge, josh, that's levitating the whole nasdaq. >> well, kelly, this is really the first quarter where you're seeing these tech giants start to really cash in on their cloud businesses. investors obviously like what they see in those stocks are just surging in today's trade. amazon, a leader in the cloud, this is a market that within just a few years it will be worth nearly $130 billion according to idc. you saw aws hit $2 billion this quarter, growing nearly 80% and it's giving amazon a real competitive advantage. jeff bezos is using his cloud business to subsidize his e-commerce business and that's
allowing him to undercut anybody and everybody in his market and over at microsoft ceo adellum has promised to pivot his company into this cloud first world as well. you saw revenue from mic covet cloud segment jump 8% to $6 billion. finally, there is google. ceo pacahi on the conference call saying they are unique ily well positioned to command and control this market. >> what's exciting is i look at new customer options, you're seeing tremendous momentum. we are very competitive in each of those situations and we are investing a lot and playing for the long-term. >> now, with all these companies there's also this renewed focus on transparency. in fact, we wouldn't even be able to talk about these cloud businesses if big tech hadn't decided to peele back the curtain and give investors a lot more insight into their businesses. guys, back to you. >> okay, josh, thank you very
much. the nasdaq is making a run at its first close above 5,000 since august. morgan brennan is there. you have three lead stories today, you add them all up and have that sue pearl testify to describe the performance. >> the nasdaq composite up 2.6%, more than 126 points, we are at the highs of the days coming in here into the final hour of trading. this is the fourth straight week of gains for the nasdaq. tech the high here but it's not alone, either, biotech having a great day, the i shares, nasdaq, biotech, the ibb up more than 2%. celgene, regeneron, even myelin which has tried so far unsuccessfully to take off peridot. oscina health is up. other healthcare it services, all scripts also higher today. liberty global which is in talks
to potentially acquire wireless communications that's higher today. media stocks, dream works, viacom, discovery also soaring. check out the gaming stocks, the wynn resorts it is one of the nasdaq 100s top performers today. even though they don't trade here i would mention las vegas and mgm resorts are all up big today and that's presumably on that surprise cut in china and what that could mean for macau. >> we will talk to boyd gaming next hour. take a look at facebook trading over $100 a share, brand-new record for the stock three years in the making up 170% since it's ipo way back in may of 2012. but is this the top? >> let's bring in max wolf from manhattan venture partners. max, welcome. always a pleasure, thanks for having me. >> kelly asked the question in the intro is it the top? is it fully valued or not? >> near term we are probably at or close to a top. we can see this powering higher, there is momentum here, great
position in a great position but you are paying an awful lot for t we fundamentally don't believe in paying for 110% perfection and execution because nine times out of ten you look back on that and shake your head, we would rather do it the right way even if we lose a little bit in the next couple weeks and get it right for the long-term. certainly a great story. >> mark zuckerberg and the facebook team at your peril, though. hasn't that been proven as an investor? >> part of the reason i'm on your show as often as i am i was the guy with the $18 price target when they went public at $38. i doubted them, never doubted the company, doubted the valuation, you always have to care about valuation. within you fall in love with a valuation story you have the fallelen out of your bed with your job which is to be skeptical. we love the video and the company, it's just too expensive here. >> facebook also fell to those levels in part because it didn't have a mobile strategy, wasn't capitalizing on the shift, then it found one quickly.
it's moved since that low,it's plenty justified by the fundamentals of what it's doing here. i understand the valuation is high, but what is most important for them to keep executing so that at least that earnings number continues to grow as we're seeing here? >> i absolutely agree. we were very early saying we still believe mobile still the future. social fragments a little bit, i think we get the category killers. i like to analogize facebook to the first department store, it's the one stop shop for all your digital socialites but eventually people migrate into the category killers, they want to go to williams sonoma for their cook ware and bed, bath and beyond with their basics. we think they are going to monetize instagram, it would be interesting to see what they do with what's app and october u lus. high valuation expectations and high multiples for growth on a
$250 billion company are not usually the prelude to grand yer, they are usually a prelude to regret. >> not to mention what they're attempting to do in building out their own search business. >> the search business is interesting and they're trying to keep folks in there, that's the model that we saw apple do so well. they're trying to get you to understand there is no real reason as far as they and their advertisers are concerned for you to ever leave the facebook eco system. we like the eco system, mobile video is huge for them, we see them as major tech bow home myth astride the digital landscape for years to come, the question is do you want to pay for them to get everything right for 24 months into the future, our answer to that question will always be low. it's just not smart money on that statistically adjusted basis. >> you also seem to be fairly optimistic on twitter at least by virtue of the notes that i have in front of me. the jury still out, though, that twitter is coming back, right? >> absolutely. i think it's a more impacted story that's not so clear. we were terrible at telling
their own story at 140 characters or 140 days for a long time. facebook figured out how to tell its story and sing a tune. we do think twitter gets there, i still think at which time srt first draft of human history, i think it's powerful and a premiere journalism tool as you guys can attest to with your many fans but it has had a hard time trying to figure out how to make money. it's a better valuation to risk than facebook because i think it's going to come back and they are going to do well compared to advertising and movie consumption and win part of the second screen war. tough story, it's been hard to stay with the name but we think the folks who hang in there will be rewarded. >> max, thanks for joining us, appreciate it. max wolf from manhattan venture partners. about 50 minutes to go, the dow up 168 points, the s&p adding 23, it's the nasdaq, though, look at this, up 2.4% or 118 points. >> best day in a couple months for the nasdaq. china's sixth interest rate
cut since november also fueling today's gains. our seema mody has a special report. >> riverfront investments ceo just returned from a trip to china, he will give us his reading on the country's potential to hurt wall street and your investments. you pay your car insurance premium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™,
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take a look at markets. the dow is up 170 points. here is a look at the sectors of the s&p 500 on a day where we know technology is leading the way. up more than 3%. where you see that movement in any particular space, healthcare rebounding after several concerns combined this week pushing it lower, now back up 2%. financials doing okay, up about 1%. again, more in the last 24 hours on global stimulus, whether it's europe or china, scott. >> in fact, china's central bank cutting interest rates for the sixth time since november. seema mody has the details. >> after china's disappointing gd report economists were predicting further easing but it's the timing of these rate cuts that is catching investors by surprise. coming in sooner than expected suggesting to some that the october data out of china will be bad. the main objective of these rate cuts is to improve china's lending environment by reducing
the amount of cash that banks must hold as reserves. global markets are cheering the move takenen by the chinese central bank, the german dax up 6%. commodities on the move, danske bank writing that oil prices should recovery next year. many skeptics including morgan stanley say these small moves taken by china may not not be enough to kick start growth. remember, guys, debt is growing twice as fast as growth in china. highlighting just another challenge that the country has to tackle. but of course the proactive approach taken by the pboc suggests they are committed to financial reform and economists say it's removing some of the pressure on major central banks which have referenced china as one of the major concerns, including the fed. >> do you know what it's time for now? the "closing bell" exchange sniefs wondering where the exchange was. >> let's get right to it.
michael jones is here, ben willis at the table and our very own rick santelli. welcome to awful you. ben, what are you watching today in this market? >> healthcare in particular to narrow it all the way down to the hospital stocks. >> they got crushed today. >> they have been under a lot of pressure lately. tenant healthcare helped put a bottom in, and you had mr. wise on your halftime show suggesting he has been buying it. that's the focus for our investors where we are right now away from that, the energy sector and a little bit of pressure that may be profit taking up one of the better performing sectors for the month. so that's really what we're seeing on both two sides of the tape. >> not to discount what we've seen in tech today, but yesterday if you combined what the ecb said and overnight what the pboc actually did, that's the main driver of what we're seeing, don't you think? i know you are just back from asia, you had your johnston and
murphys on the ground there. what did you see? >> today's price action recognizes that china's interest rates are still relatively high. they have a reserve requirement that's twice what it was ten years ago and they've just started quantitative easing through their extended program for bad real estate loans. that means they have all kinds of capacity to stimulate their economy and avoid nearby economic armageddon, the market forgot about that over the last 90 days, today and yesterday with the ecb was a big, big, big reminder they've got plenty of tools to apply. and they are going to need them because having been in china i can tell you they have had an epic real estate bubble, they feel a lot like japan 20 years ago, they've got some advantages that japan didn't v the question is whether they will take advantage of them. >> rick, it's not the first time we've seen china cut rates, china get in front of its problems. have they finally done it here?
>> no, and i don't think there's any way they can do t does that mean that the game is going to end. no. music can play for a long, long time, but the reality is the backup generators are keeping the lights on and our guest is correct, they have a lot of ammo. they have a lot of fuel to run that generator, but that generator isn't running on real growth. okay? and the real growth is hard to artificially create and these economies keep trying to bide time for that growth to catch, but the problem is the debt created to come up with the fuel for that backup generator never goes away. unfortunately the backup generator starts to fail and we see more stimulus come n now, listen, i think what equities are doing, this is christmas, starting in october. i don't see what's going to stop global stock markets, especially the u.s., and i think things will start to get dicey, of course, when you bring the parents back in the room and that of course are the central bankers and central planners, unfortunately -- and i think as
we see the first quarter and the possibility of our fed doing something or not doing something, that will give us the next chapter, but consider a couple of things. when the chinese do whatever they do on the stimulus, it's always a surprise. you have to hand them credit for that. they understand surprise gets you more results than trying to telegraph things, especially when you don't know what the outcome or how the market is going to perceive it, and last the spread between boons and treasuries has diverged ten basis points this week. that is something very unusual and we all remember that what was a big point bringing yields down in the u.s. was when boons went to 04. so we want to watch that relationship very closely. >> i'd like to add so what rick said. >> go ahead. >> the bank of japan also understands the value of surprise and with the japan post offering coming up by the end of the month i wouldn't be surprised if he also unveils additional stimulus that no one is expecting. >> so, ben, what i was going to
say is given all the central bank activity and there are certainly critics of it, whether you think it's going to work or not as rick just said, you may not like the music, but investors seem willing and more than ready to keep dancing as long as that's the opportunity that's playing. >> the global market is without a doubt still being a function of the central banks throughout the world led by the pboc and what they're doing. we have now become so focused on china from their stock market to their actual economy. by the way, on monday they convene a meeting for their economic progress or they will come out with their game plan for one year to five year. so that is a very important stop i can why they change their rate structure overnight. the japan story, the european story. the fact of the matter is for me the united states of america's generator has been working, the lights are on and we're starting to function on our own, we're leading the global markets in a demonstration that our central banks have done will be successful. i believe our central bank is behind, they should have raised rates already, but that being
said you are still trading and your investment outlook still based on central banks throughout the world. we need that to be removed so we can continue to succeed and invest as americans. >> i guess part of the issue, rick, is you don't actually know what the pboc is trying to stimulate because we don't really know exactly what the true state of the chinese economy is. are they trying to further stimulate a 6.9% economy or is it a 5.9% economy? we frankly just don't know. >> you're spot on. we don't know. i would say actions speak lowered than data you are unsure of. the fact of their aggressiveness close to a year, how many times they've eased, i think that speaks volumes about the nervousness of the communist party's lever pullers with regard to keeping the economy humming along to keep the social fabric of their society at peace. >> gentlemen, thanks all of you, have a great weekend, ben, rick and michael. appreciate it. whatever you think of what's gone on over the last 24 hours
with central banks speak or action, it is having a profound effect on the markets, dow jones industrial average right now is up 165 points, nasdaq has been the outperforming all day, in part obviously because of microsoft, google, amazon, nasdaq having its best day since august 26. >> another stock doing well today is royal crib kran, the ceo will tell us what's powering the company's latest earnings and increased guidance coming up. apple gearing up to report earnings next week, but will it follow in the footsteps of -- i can't get used to the alphabet thing, i keep saying google. you can't, either. amazon and microsoft works leading apple analysts give us the bull and bear case coming up. here at td ameritrade, they love innovating. and apparently, they also love stickers. what's up with these things, victor? we decided to give ourselves stickers for each feature we release. we read about 10,000 suggestions a week to create features that as traders we'd want to use, like social signals, a tool that uses social media to help with research. 10,000 suggestions. who reads all those?
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welcome back. looks like a strong finish to the week for the stock markets, especially the nasdaq, it's having a day of up better than 2%, 2.3 to be exact, the s&p broadly adding more than a percent, the dow range hanging in there, too. here is a look at the nasdaq 100 meet map. led by some of the tech companies, bolstered by their cloud performance and the billions they have invested including alphabet, amazon and microsoft there. am i reading this right, up almost 12.5%. >> the cues, the etf that tracks the nasdaq 100 as you are citing is up more than 30% from the
august lows. >> wow. >> up at least 32%. and that was earlier today, it could be a few points higher than that now now. it gives you an idea of the come back that the cues have had led by the biggest of tech stocks. >> there is a look at the power shares, q, q, q stock was referencing, up 15% on the year, but a strong performance from that august spot. >> capital one financial among the biggest gainers on the s&p, ceo richard fair banks citing strong growth in the bank's domestic card business. whirlpool sliding to a 52-week low despite better than expected quarterly results. warning head winds could subtract $2.5 billion from it's revenue. royal caribbean stock beat earnings expectations an announced its accelerating half a billion dollars worth of share buy backs. >> stock up more than 50% over
the past year. we are joined by simon hobbs who covers the cruise line space and the ceo. >> richard, welcome. nice to see you. >> nice to see you. >> one of the founding fathers of the modern cruise industry. for you guys it's all about the pricing with fixed capacity and on board spend. this quarter looks strong in the caribbean, in europe, even in china, though clearly you have some problems in latin america or south america with the right down. how would you sum up the quarter? >> i think you said it very well. it's really the culmination of a lot of work by a lot of people to get a better product out there and start getting paid for it. we're seeing the fruits of that now. >> you have made a lot of people rich with your share right performance, it's up over 200%. one of the reasons is that you've set clear targets on behalf of shareholders for performance.
now you are at an all time high. a lot of people are like why would you accelerate the stock buy back by half a billion dollars if you are at an all time high and ubs is pointing out that this will flatter your earnings per share figure for 2017 and the time of an inference i wonder if they have to do this in order to hit their target. do you -- >> well, you know, simon, we've been talking about the possibility of a share buy back for a long time. it's really very nice, we are a capital intensive industry and we have been reinvesting in wonderful new ships and i think that's what's driving our profitability but we have always said that we think returning capital to our shareholders if the time becomes appropriate is the right thing to do. that's always been part of our strategy and i assume it will continue to be, but >> but to my question, richard, do you need to do this, do you need to accelerate ahead of cash flow to hit your targets? >> no. i think we set our targets based
on all the things that are happening. the share buy back is an insignificant part of a major campaign that really focuses on three things, improving our revenue based on better ships, better eye tin raers, holding our costs under control which we have done and modest capacity increases. those are the three drivers and that hasn't changed. >> it's scott wom ner, i'm wondering what the airfare wars mean to your business. if it's tougher to attract customers in an environment where people feel that they can simply fly to the caribbean or fly to europe or some other far off location rather than perhaps take a cruise. >> well, i think the airfare wars confuse the consumer and we think that the more the consumer understands about our value proposition the better we are and i think you're right, when there is these airfare wars it does add another wrinkle to their thought process, but it's a small part of the total
package and the cruise value is really seen to be so powerful that it overcomes that. >> richard, what plans do you have for entering the cuban market? >> well, i think it's exciting to see cuba beginning to open up and obviously we have our focus on doing so as the opportunity arises. it's not yet open. when it does we will be ready to go in there. i think it's important, though, not to maybe put too much emphasis on that because i think it's capacity for handling large volumes of cruise guestes is probably pretty limited. so when it starts it will start slow and then build up over time. >> we should mention that next wednesday you launch another billion dollar ship, this time the anthem of the seas, i think we have some pictures of that in advance. it is the sister ship of the quantum of the seas and people will see it has a passenger crane on top which lifts people
into the sky. i wonder if you could remind you what this sort of innovation did for pricing on the sister ship and will you be sending this one to china as well? >> well, the quantum of the seas when she came out just a little over a year ago was a tremendous success and the north star observation platform is almost iconic just in how it stands out there, but it's these innovat n innovations which really remind me all the cruising offers. so it really helps us in attracting first to cruise and to convince people who are trying other kinds of vacations to see all that we have to offer. the quantum of the seas was the first, as you say, anthem of the seas is the second. quantum is already in china, anthem is going to be staying in new york harbor and sailing from there year-round. the third of the ships, which is coming out next june, will be ovation of the seas and that vessel is going to china. so we will have two of these
great ships in china, but to start with one here in the states and i think the ships have been so well received because of their innovation, because of their technology, because of their style that that's helping boost our earnings and maybe that's a little bit behind our share price today. >> good to see you. thank you for sharing the time. richard feign joining us exclusively, the ceo and chairman of royal caribbean. >> thank you, simon. time for a cnbc news update. let's go back to sharon epperson. >> southwestern is preparing for the worst hurricane as hurricane patricia bears down on pacific coast regions, it has become the strongest storm ever measured and police patrolling the streets are ordering the evacuation of resort hotels. the storm is scheduled to make landfall later today in mexico. the justice department is declining to bring charges
against lois learner, at the center of a political controversy over the processing of applications on tax exempt status. she refused to answer questions at two oversight hearings. hillary clinton has won the endorsement of the 1.6 million member american federation of state, county and municipal employee union. they say clinton would be the most effective champion for working families. and nike is go b. to open its first ever michael jordan store in chicago tomorrow and the lines are getting long and longer. the merchandise will include basketball training, sportswear and kids products, all featuring jordan's jump man silhouette. that's cnbc's news update at this hour. back to you. >> thank you so much. crazy lines. 30 minutes to go into the close. do you up 150, s&p adding 21, nasdaq having a super strong session up better than 2% or 109 points today. >> up next art cashin tells us what he's watching as wall street looks to end the week on
welcome back. a strong session for stocks after china cut rates and the european central bank hinted at more possible stimulus. oil, though, still moving lower, that's hurting energy names, technology bolstered by earnings having an incredibly strong day. we are keeping an eye on the vix. >> final and most important half hour of the trading day is underway. you can see some unusual volume as we have learned over the last many weeks, art cashin, good to see you. >> thank you, sir. >> central bank driven. >> absolutely. 100, 110%. >> how could it be 110%. >> it really is a carry over. we did a couple of important things today, we rallied twice, the key resistance in the s&p, 2077 to 2081 and we've pulled back from there. that's not absolutely conclusive, but it's interesting when you see them stop twice at
about the same spot. big week next week, fmoc, there is a major meeting in china where they do longer range planning and we will have that going and of course we have to see what happens with europe. where is the next central bank to come out. >> i was going to say apple reports next week and maybe for a lock stok that hasn't really been participating all that well, maybe you have had money coming out and going into some of these other tech names, i'm sure the bulls would like to see apple playing the game. >> they want to see if the apple 6s is as good as it initially looked. there was some thought that it kind of lagged and everybody wants to hear about their other projects. what about apple tv, what about some of these other things, where do they stand on this. >> it would seem a lot of markets are surprised by the way this market continues to move. >> to some degree, but when you've got central banks positively shoveling money at it, then people are looking around and saying, the economy is not that good, but i've got
to be in stocks because they're raising the value or at least the price of stocks. >> arthur cash inn. kelly. >> great stuff as always. shares of apple higher today on heels of strong reports from tech giants alphabet, amazon and microsoft all after the bell yesterday. now the pressure is on for apple to meet expectations next week but can it deliver? let's ask alan and brian. great to have you both with us. >> amish i will begin with you, you think apple can do it. didn't we just hear from these three companies, it's really their cloud business that's delivering. what is apple going to bring to the table to top expectations next week? >> if you think about next week what they're going to bring it s. they are going to do what th always do, they're always very successful every quarter with sales, they have been ahead of estimates. people are really looking affording to analysts a christmas, the day after christmas and what's going to happen this quarter. everything is baked into the price already and the biggest things if you look at three of
the analyst that is came out with their buy rating and upgraded the stock. the maxim group analysts also said wait until the electric car comes out. i've been on way before about the apple watch -- >> they are not going to report that next week. >> they're not but i think for the future -- >> what do you think next week is going to deliver them in earnings, steve, relative to what you say is priced in? >> they are going to be ahead of estimates next week, kelly. >> brian, why do you think they're going to do it. >> there is a little variability next week. the street is at 48 million. this is all about iphone units, this is not about watches or cars right now, this is the september quarter and december quarter hinge on iphone units, 48 million for september will be about right. the biggest challenge for apple is because of the december quarter units. the street is expecting consensus right now is 76 million units of iphone for december and i don't think they are going to make that of, i think it's going to be lower that.
there is a lot of evidence in the supply chain this is the case, there is a lot of demand-related evidence this is the case. the second is going to be march quarter, it looks like it is going to be lower than expectations >> i i disagree. fortune magazine did a poll of analysts and the average is 71 million. >> even better. >> hold on. hold on. let me finish. let me finish. i didn't cut you off. 74.6 million was last year which was their biggest most profitable quarter. 5% above that will be 78, 2 billion above what you're saying, brian. read the reports. it might be about the sales but this is all about christmas and what's going to happen. >> brian. >> so the bottom line is the reason why they were so successful and did 74.4 million iphones last year it was the first time they introduced two brand-new form factors. they went to two larger screens and saw tremendous international
demand, especially in asia. well, that's a year old and the newest iphone 6s is only slightly iterative. the main future is 3-d touch and then the camera. that's not a massive reason for an upgrade like it was a year achlgt i think they're actually going to be a little lower than the street's expectations whether it's 76 or 78 as this gentleman says, i think it's going to be lower and that's going to be the issue and it's going to show up in their guidance. >> let me ask you a quick question about the stock. >> sure. >> why has apple been sitting on the bench in this rally and is there the possibility that money that would have gone to apple is now going to facebook, amazon, microsoft, google, alphabet, whatever you want to call it and others? >> absolutely not. i don't believe that at all. why >> why has it been sitting out the rally then? >> it's doing what it always does. the stock was at 90s a few months when i was on here. it's still at 119, the targets are between 150 and 180. what you're going to see is an uprise, an uprise to end the
year, this stock will be over 200 when the electric car comes out. >> it doesn't matter where the analysts are. the question was the right one, money has been flowing into these other names seeing substantial growth, amazon's web services can killing it, google is killing it on mobile ads and apple is experiencing a sector that is slowing, smartphone growth is slowing globally and investors have been pulled back on it, none of them are moving the needle. >> money can't go everywhere. >> they are still blowing away google and samsung. >> apple is fascinating the cloud and needs to fully capitalize on this like these are. thank you. we will leave it there for now. we have 20 minutes to go into the close. tech is leading this market today, up 3% on the s&p 500, the broad index up 1%, the dow nearly that much. the nasdaq is up 2%. >> up next, ups pilots vote to strike as the peak holiday season approaches. we will tell what you this could mean for the stock as well as
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ups pilots voting to authorize a strike out of the peak holiday season is fast approaching. morgan brennan has the late snooes pilots at ups voting to authorize a strike against the delivery giant. now, this is a 2,500 independent pilots association which flies cargo planes for ups has been at odds with the company since 2011 over a new contract. today's vote means the union's board can formally request a release from mediated negotiations from ups and strike when those talks conclude. all of this as ups is gearing up for peak season. even if a strike doesn't happen during the holidays labor uncertainty is a risk that could cause customers to go elsewhere including fedex. still, ups is insisting this will not impede service to customers. >> the vote is purely symbolic that these are very common in airline contract negotiations.
that talks actually continue to progress with negotiation dates scheduled out for several months and that our customers are in great hands headed into our busy holiday season. >> right now both sides are scheduled to return to the bargaining table early next month, but how all of this plays out is going to depend on how federal mediators respond to the union's ask q. to strike. guys, back to you. >> thanks, morgan. our morgan brennan with the latest on that situation. we have about 15 minutes to go before the week ends on wall street. a four-week winning streak. looks like it's going to be in the books. the dow jones industrials now up 17 0rks nasdaq having a great day wz well, mentioned best day for the nasdaq since august 26, the s&p is obviously strong given the broader markets today. >> i think rich peterson from s&p capital iq was neng ming this might be one of the strongest october we have had for the s&p 500 a top ten finish bucking the trend of what we typically see this month.
it's friday that means david darst is here. darst is next. big day? ah, the usual. moved some new cars. hauled a bunch of steel. kept the supermarket shelves stocked. made sure everyone got their latest gadgets. what's up for the next shift? ah, nothing much. just keeping the lights on. (laugh) nice. doing the big things that move an economy. see you tomorrow, mac. see you tomorrow, sam. just another day at norfolk southern. you ppremium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™, you could pay no deductible at all. sign up to immediately lower your deductible by $100.
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s&p getting back positive for the year, the nasdaq ripping today off those great earnings after the bell yesterday, joining us is david darst. >> hello scott and kelly. >> got your halloween tie on early. >> thank you. >> getting in the spirit. >> trick or treat in the markets. >> this is a lazarus market where he is brought back from the dead. this was a zombie market two weeks ago. calm in europe, mario draghi, china, housing good, all those things good. do you know what, big tech. that's been the story of this week is these huge technology companies coming through really big on earnings. internet advertising is $100 billion. google gets $60 billion of it plus 8 of youtube, 68, listen to this, facebook gets 24. that's $92 billion. it leaves all the others to scramble for crumbs. >> you haven't even mentioned the stock that f. i had a dollar for every time you mentioned microsoft over the last few years i would be a wealthy man.
do you still like it? >> microsoft has looked good. i like what adella is doing, the new guy. sounds like they have a plan. it's amazing jeff bee zeros can become the third richest person in the world by presenting a.m. gallon as a big data and cloud company. that's really where people are going. >> growing web services 80% revenue. >> cloud computing is the uber of technology or airbnb. you don't own the data center anymore, you put your data over there on somebody's couch. >> and just real quick, david, going back to this market and the fact that it's bolstered by central bank stimulus. i know you like that. is it sustainable? >> kelly, the whole -- the whole world and they are hoping that they can bring us across this red sea of slow growth of uncertainty. what this world needs and a seven-year-old child knows is structural reform. structural reform some is taking
place in china, not a lot is taking place in europe, a little bit in india, but we need is t. here like crazy. savings and investment, education and infrastructure. who is going to do it? do you know what, i'd love to see paul ryan bring everybody together a little bit. he's young, i think he's got a little bit of a water roll off his back personality, which is very good so that you don't take offense when people go at you. that's part of structural reform. to get structural reform you have to have somebody who can say no and say it in a nice way. >> what has changed, david, since the august lows? >> all right, so the ecb sounds dovish, we knew that was going to happen. the pboc has cut rates. we thought that might happen. the fundamentals of the story improved at all or no? >> scott, great point. five c's that you've got to be watching, crude oil, it seems to have stabilized. okay? currencies. the dollar, okay, the dollar has
gone back a little to the weak side, which is good -- >> not now, though. >> it's strong today because these others are weak, europe is weak because of mario draghi, but the dollar against these emerging market currencies that's the second c. third is corporate profits. to me that's what's slightly changing. are they gang buster? no. but they look a little better. scott, credit, that's the fourth c. finally, the consumer. the consumer is not at the party in a big way, retail sales, weak last month, lead indicators weak. we've got to get -- we've got to get the consumer cracking. >> you did good with the list. people haven't fared all that well at times on this network when they make lists >> sometimes when i'm looking at you, scott, i forget my own name. >> david, thank you so much. we will see you next week we hope. up next, we are back with the closing countdown. >> after the bell we've got meg terrell setting the stage for valeant's conference call on monday as broad allegations weigh on that company. you're watching cnbc, first in
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better than expected earnings after the bell yesterday, nasdaq having its best way dmai a couple months. for the week the dow pretty good story to tell. dow up 2.5%, s&p 2 and nasdaq up 3 on the strength it has seen today. mary thompson down on the floor. pretty good week. it's a lot of talks about central banks. >> i was going to say underlying what has been a good week it's definitely the expectation that is we are going to continue to see extremely low interest rates, but on top of that of course the tech earnings. i think you want to take a look at some of the other strong performers this week. if you look at the dow, strong performance, microsoft, but also you saw big gains in mcdonald's showing sales growth. >> good point. >> for the first time in over a year globally and first time in two years within the dow on i'm disappointed to see ge unable to hit that 30 mark, a number of us former employees -- >> i think it hasn't been over 30 since '08. >> since june of '08. a number of people were coming into this session within we were
expecting the dow to break through the 200 day moving average which indeed maybe would pull ge along with it, that wasn't the case. >> it's come a long way in a short period of time. >> united technologies had a very good week as well. the company announced a $12 billion buy back, the company's new ceo is focused on returning capital to shareholders and has done that. >> yesterday was one of the best days in some time for the industrials in part because of utx. as you look into next week what are you going to be thinking about? >> the fed meeting is important in large part because you want to see what the commentary is afterwards, but i also think you're looking of course for apple's earnings which are coming out, twitter, ups, merck, some of the others, but apple will be the one that everyone focuses on. >> we were having a conversation i wonder if you felt it down here as you talk to people that money that ordinarily you may find a home in apple has been going to amazon, going to microsoft, going to google, going to facebook.
>> well, for the week it's up 7%, that's better than all the indices, it's not like the money hasn't been going there. maybe certainly not as aggressively as some of the other companies but it's their week to shine. apple gets its turn next week. >> i don't think anybody is expecting any big surprises out of the fed next week. >> not at all. >> if it was on the table at one point it seems to be already in the living room watching tv. >> people are thinking now it could be midyear next year. with draghi's comments earlier, if he's going to introduce additional stimulus into december, the fed really can't go ahead and raise rates in december while the euro -- when they are doing that in the eu. so, you know, you have to watch -- you were talking to david darst about this. the dollar is at a seven-week high, i believe, against the euro and this has been another issue in corporate earnings this month. >> right. >> this season that we've seen this strong dollar continues to be a problem for u.s. corporations, hard for them to get revenue, ramp it up on that. >> mary have a great weekend.
>> you as well. >> show you who is closing the market today, it's paul graph energy here at the big board, up at the nasdaq the alzheimer's association, the center for alzheimer's research foundation as they ring it up there. everybody, have a great weekend, the second hour of the "closing bell" with kelly evans and company begins right now. thank you, scott. welcome to the "closing bell," ever been, i'm kelly evans. what a couple days we have had on wall street. the dow up today 161 points on top of yesterday's big gains. 1% gains for the s&p 500 today as well. led by technology. that also helps explain the nasdaq's super strong performance up 2.3% nearly, 111 points to close back above 5,000, a level we had given up during that weak patch that we traded through during this late summer and early fall. joining today's panel we have evan knew mark and kate kelly and ryan larson and "fast money"
trader tim see more. welcome one and all. evan, i will start with you, these earnings that we got yesterday from amazon, from alphabet, from microsoft specifically really seemed to be some sort of inflection point, don't they? with the cloud business and tech investing. >> i think it's been a great week for the market. i would remind you, kelly, in case you had forgotten that the s&p 500 basically flat for the year. >> better than down 7%. >> absolutely. much better than down but it's not like all of a sudden the market is up 10% for the year, it's flat for the year. what that masks is the tremendous performance that's underlying a lot of these big tech names. i'm looking here, you have amazon is up 92% year to date, google, alphabet up 35%, facebook up over 30%. even the ones that haven't performed, apple, which is up, you know, 6 or 8%. >> right. >> are people dissatisfied? that stock is up 75% from last spring or over 50% from last
spring. my point is these are huge moves in the tech space, but what you see at the top line is not a lot of growth. >> that's true, kate. if n. a lot of these businesses they are repositioning themselves, take microsoft, for example, obviously pcs used to be the jugger thought now the cloud sin crease i thinkly important. >> absolutely. i think what we're seeing is sector specific here, maybe i'm getting too cynical talking to too many traders whenever we see a moment of euphoria or optimism i wonder if it's short lived because there still continue to be true fundamental problems in energy that aren't going away anytime soon, the retail story a huge concern with walmart lingering over the last week plus in pharma we've been talking about valeant this week but more broadly there are real questions about whether the run up is over, whether the merger, you know, fervor is ending and i think, you know, you have to be ready for anything in this market. >> plus, ryan, you can point to just the past 24 hours, china
cuts the rates, european central bank talking about easing come december. you would like to be in a period where you move past that bolstering the market, right? >> exactly. i think we at some point need to get past that. maybe it's warranted in china, maybe warranted in europe. i think from the u.s. standpoint fundamentally speaking we should be beyond that, right? we should be looking at more fundamental growth. great to see microsoft this week, amazon, alphabet, those were great numbers and the market rewarded those companies but i think in the u.s. we have to get past rally on hopes that we are going to see more qe from the fed and bring it back to fundamentals. >> at least we got some of that here. tim, also interesting, let's put up the dollar intention, a big move in the last couple is session, we have seen the impact on some of these corporate earnings. coke especially had a huge impact obviously. what happens if we are back in a position where because of america's relative strength that dollar keeps moving up.
>> it's going to continue to to be a head wind. we are now -- we are now almost three-quarters into this whole dollar stronger period. i agree the dixie which was languishing around 93 even ten days ago is now back force three through the 200 moving day, you can see the impact what that will do to commodities or emerging markets. we get back into the same dynamic. it's interesting to me today that on a day when china cuts that people are embracing this policy move when really it was two months ago that china's first bold move into policy readjustment or at least of this cycle was alarming. so i just think we are in a place where a lot of people it's okay to say traders are cynical. if you look at where we are on the s&p the 10% retracement off the lows, a lot of people think it's time to throw shorts back out there. >> on that note thinking about psychology, to what degree i wonder are people investing in u.s. equities still because it's the default best option? i mean, as you say, china growth
is slowing, there are real concerns about what economic stimulus they are going to have to employ, europe mixed bag but still relatively stagnant, still a lot of wood to chop economically not to mention the geopolitical issues that are troubling them right now. u.s. stocks still attractive, at least pre rate hike, but that may very well change by the end of the year if not sooner. >> i think the narrowness of this rally is something people will talk to. if you look at amazon and google last quarter, they were the ones that again a little bit of growth gave you a huge move on earnings. what's interesting on fun flows is the european markets have seen 21 of 23 weeks and are the big winner over the last month, month and a half. weaker euro will be supportive to investing in europe. i think people are looking at the market and saying, hey, a lot of this is massive short covering. look at the positioning coming out of september, hedge funds had one of their worst months in a long time.
>> evan. >> coming back to some of the points tim was touching on, you have to see at some stage a global reflation/global growth. you really do -- in order for the u.s. market i think to move substantially higher you have to see growth overseas, you do have to see a pickup in the oil price, the oil price going up. i don't think the dollar -- >> can we leave that oil price behind? >> absolutely. i think these things -- you know, things happen much more quickly than people think. i mean, when we were sitting here at the end of august you would have never have gone, oh, yeah, the -- >> time to -- >> the s&p 500 will be back to where it was. i think that is really the next leg of the story is will there be the -- i happen to believe it will and i happen to believe if you want to find value in the market you're much better off in materials, energy, than you are in big tech. >> hold that thought for a second, ever been. we have to get back to earnings. no slowing down the pace. the question is how is earnings season shaping up so far. let's get to seema mody with the
score card dmoord as of today 172 s&p 500 companies have reported earnings. of those names 70% have beat expectations, 8% have mash and about 23% have missed estimates, but the top and bottom line growth has been lack lust for say the least, blended number which compiles actual numbers and estimates for companies that haven't reported is roughly 3%, far better than the 4% drop we saw in early october but revenue growth is better worse, 4% versus the 3% contraction we saw earlier on this earnings season. earnings does ramp up next year, we will hear from over 150 s&p 500 companies, some of the big tech heavy weights including apple, twitter. we will also get a sense of global concerns regarding sunshine with ups, some of the big biotech names including amgen, one of the big china internet players and exxonmobil on friday.
buckle your seat belts next week, could be very interesting. >> add to that the gop debate wednesday night. i'm looking here, guys, with this earnings calendar on tap and some of these growth concerns and all these big moves. the dow turned in its fourth straight week of gains for the first time this entire year. is this an environment you want to be long into next week? >> i think it's impressive. kim mentioned the retracement, we are seeing a.0% retracement from the august lows. i certainly think it's been a process, but at least the latter half of this week has been impressive. i would say impressive probably for the wrong reasons. central bank stimulus from china, ecb we talked about that. so we are going to want to see the fundamentals continue. >> there were -- i note you're right but at the same time some of the earnings stories have been fundamentally encouraging not just what's happening in the tech space. take capital one today, those shares were up 8% on its earnings report. there is glimers of hope for the
economy. >> right. i think that's another -- we were talk about this with raymond james earlier this week as well. i think financials may very well be they are waiting in the wings for interest rate news. in this case, though, a good earnings story is obviously a ben and the market likes to see it. despite valeant or isolated things this week has been very good obviously for longs, but on the hedge fund size just to pick up an earlier point from tim from what i'm told october will have a terrible showing for a lot of hedge funds. it's been a while since the disparate between the market performance and general hedge fund performance has been so great. >> this goes directly to my view. every time you watch somebody start going it's a stock pickers market or something like that, it's really not. >> unless you are david -- >> it's very much second to recally driven. it's very much -- you have to be in the right sector when it's turning. i don't care what biotech you were in at the beginning of the year, the biotech sector as a whole has been taken to the wood shed.
so it's really -- it's about valuation, it's about sectors, it's about growth in the economy, it's not about getting the earnings exactly right on an individual stock. >> and i think it's not always rational, i mentioned david ionhorn he had a compelling letter where he talked about his 17% year to date drop. he said part of our mo we look for dislocations in the market and fundamental stories that aren't being properly priced. in his view at least in some of his major holdings the market still not being rational. >> what would you say to that? >> i think that's right and look at credit markets which haven't rallied back. the bond goes are usually smart sher, the credit markets are always the smartest. credit spreads have stayed on the wides. we are talking about fundamentals, we should be talking about just positioning. part of the reason we are where we are at the end of this week is positioning. you have the s&p trading with an rsi relative strength indicator, a measure of momentum at levels that we haven't seen since
november of 2014. i just think the market right now has gotten back to a sense of calm, that's good because i think the markets were overreacting. i will be the first to tell you i don't think the market is that bad of a place. >> we will leave is there, but, ryan, before we let you go your top way to play this market right now or best ideas. >> i think if you think of the end of this week, consumer discretionary, tech, possibly energy, that's going to lead, right, so as we see some of these tech companies continue to report next week we get good numbers like we did this week, i think we see it again tomorrow. >> i have a question, broadly speaking let's say you have a majority of your 401(k) in some sort of stock fund, should you be reing tagt out? you have now recouped what losses you might have had year to date. should you ride it out a little longer? >> i think you ride it out. this can be back to 2100. if we can get the fed to step up in december and initialize a normalization at 25 basis points
i think the market can feel comfortable we are in a better spot and this can keep going. >> ryan, tim, thank you both. much more coming up on "fast money" at 5:00. one apple analyst seeing big declines in an apple metric. what to expect next week is coming up at 5:00. valeant rallying today after being crushed most of the week. we will get the latest next. and nfl will stream its first free game live on yahoo this weekend. could this be the future of broadcasting? we are hear from drew rowsen house coming up.
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welcome back. it was a volatile week for valeant amid accusations of fraud. activist investor bill ak man buying 2 million more shares, the stock finishing up 5.7%. meg terrell joins us. >> they're putting ten of their members of the management team and board members on the conference call monday morning at 8:00 a.m. including several members of its audit committee,
former cfo howard shiler all to address all of these questions about allegations into their relationships with these specialty pharmacies, their accounting practices, allegations of -- made by the short sellers on research earlier this week. folks are wanting them to clarify these relationships. explained why they hadn't disclosed this relationship with the specialty pharmacies and why they consolidate the financials into their own accounting. that's the main question here. >> i have one thought on this which is, look, obviously the substance of it is going to be the most important thing, not the style. just from a format, perspective, i think they are smart to flood the zone with so many people. having talked to hedge funds and other investors about them this week, those people who are long seem to take confidence in the fact that they like the management team, they like michael pearson and howard shiler, they know their back grounds working for goldman sachs or mckin zee and because of the nature of the company
being a roll up and having so many subsidiaries you may not know the details on they take comfort in this management team. >> they take comfort in the management team because for most of the hedge funds mr. pearson and howard -- they made them a lot of money, okay? >> right. >> it's not like they're taking great comfort in it because of the facts and the way they came out or what's been disclosed or the fact that in the last conference call they basically said, guess what, we are changing our strategy entirely. they don't get any comfort from that. they get comfort from the fact we rode this thing up, we're in so deep at this stage, ak man has to be praying that he can break even on this investment. he is under no illusion that they are going to end up making money on this thing. no way. >> i'm not saying that's a prudent perspective necessarily but i think strategically it's mart of valeant to do it that way because this is one of -- they're playing to one of their strengths. but that said do you think they will have an explanation for the general counsel letter demanding the $70 million in invoices for a relationship the market didn't
know they had? can they explain the relationship? >> it's hard to say at this point. we have this amazing sort of research from ever core isi, they put up a 62 page slide deck dee mystifying in relationship. it really is remarkable. i was talking about how analysts or investors don't want to have to go through this amount of research to understand a company they have been invested in for a long period of time. that underpins the whole issue here. if they go through it in this detail and go into the questions that are being raised here i think that will help a lot. >> does it explain everything? does it leave you going, okay, now i get it or is it sort of like, all right, well, now we understand the structure but it leaves us with a lot of questions. >> it still leaves questions. what umer is positing they should unravel this relationship with silador. that is what is concerning here. >> i think the problem that they have is the problem that a lot
of these financial institutions ran into during the '07. if you're asking the question, if you have to respond, you know, it's just a bad situation to be in. you never want to be in a position, especially in the company that has, you know, created so much division between the hedge fund short and the hedge fund long, you don't want to be in a position where you are having to defend allegations. even if everything you say is true and everything turns out to be kosher, a stock that's a high flying growth stock, once that thing is taken out and basically have -- usually takes a very, very, very long time to rebuild the trust. >> for one thing to meg's point, the complexity of the business violates your basic principle of buy what you know and can understand. the other thing is i think the optimists in the stock are sort of dismissing the sort of allegations and concerns here a little too quickly when they say -- i have had somebody say to me, well, at worst this is a 400 to $500 million fraud. how do you know that?
how do you know what's going on under the hood. >> that sort of bakes into this greater scrutiny. >> that's what's going on. >> meg, thank you very much. the bills, jaguars nfl game won't be on television this weekend, you will have to stream it on yahoo. it's a big bet on streaming. will it score a touchdown for the league? superstar nfl agent drew rosenhaus will join us next. and should recreational marijuana be legal? rand paul is saying yes, but chris christie is saying no. coming up on the "closing bell."
good news for all the football fans out there, your sunday full of nfl games will be getting a head start this weekend. the nfl has teamed up with yahoo to stream the first ever broadcast of an nfl game between the buffalo bills and jacksonville jaguars. it will take place in london, it begins at 9:30 a.m. eastern time. for more on what this means for the nfl and streaming biz let's bring in drew rosenhaus. what are your expectations for sunday morning? a lot of people going to get up and watch this game on yahoo? >> absolutely. you know, it won't be any different than watching it on tv, you know, it should be great quality. i think it's just fantastic for fans that in a game they wouldn't be able to see otherwise unless they were in, say, jacksonville or the buffalo market, now they have to chance to watch it. and that's anywhere in the
world. that's what's great about streaming on the internet, you can be anywhere in the world, get on the internet and watch the nfl. a game from london. this is a double positive for roger goodell who gets a lot of heat, but he is -- he is a leader in international football and now he is a leader on internet football. >> hang on a second before we get into that issue. just on the ability to watch this game sunday morning. so if this does get a huge number of viewers, what happens if it's not a huge viewing experience as we witness it had a lot of different streaming experiments in the past? >> it's like anything else, it's the first time, so maybe it goes without a hitch, maybe it doesn't, but it's not going to stop the momentum. i think this is the wave of the future. it's not going to impact the games on tv, it's not going to impact directv, but this is a new revenue stream for the nfl. you can imagine now every game being on the internet and people like yahoo --
>> let me just interrupt, mr. rosenhaus. i don't understand why you say it shouldn't have any impact on cable tv or satellite tv or regular commercial broadcasting. i mean, it's fundamentally a cannibalization of an existing market. it is not -- you know, if it's as good of an experience of watching it on tv, my son doesn't care whether we watch it on computer screen or tv screen. most people don't care. so how will the nfl actually navigate these different streams which you for some reason don't think are cannibalizing one another. >> i think there is a market for them all. a lot of the games on tv are at sports bars, on a big screen tv. at home with the family, i think the internet is going to be more for the mobile person. somebody who is not in front of a tv, somebody who is traveling, someone in a car, someone who doesn't have access to the tv. international people. i do think it's going to be very lucrative for the nfl. i do think that these websites like yahoo who paid, by the way,
$20 million to broadcast this one game, you can imagine there's a lot of money in this and i do think it's a separate niche from directv where you can watch every game at once. listen, fans will have to pay for t it's not going to be free i think eventually. >> isn't one spor for your argument the fact that this is buffalo versus jacksonville, it's about 1% of the national television media audience. we probably wouldn't have access to watching this game in new york if not for what yahoo is doing this weekend, for example. we are going to be able to broadcast out of town games potentially on the internet that you can watch concurrently or i assume later, maybe there will be a replay. i'm not saying it's not going to cut in -- >> i'm totally baffled. drew, explain for me the following point. you were the head of broadcasting rights at cbs or fox and you go into a room with roger goodell and you say the next five years is up for negotiation and he says, do you know what, we're going to stream -- we're going to have yahoo stream all our games, you
don't have anything to worry about, pay me full dollar. they're going to look at him like you are out of your mind. there is no way they are allow the internet streaming rights to be separate from the television or cable or satellite. there is no way. >> do you know what goodell is going to say, he's going to say, okay, we will offer you a deal, put it on cbs sports line. all the networks have the websites and have the internet capabilities. listen, if one network doesn't want the nfl, another team is going to be banging down the door to get t it's the hottest property in tv by far. no offense. but the nfl is the hottest property and what the internet is going to be is an alternate means for people to enjoy nfl games. look, when directv came on with the sunday ticket where you could watch all these games, people said, oh, there is no way the networks will let this happen. but it worked out perfectly. and now fans of dawson fan is in buffalo he can watch the
dolphins. >> the only answer for the nfl is to schedule twice as many games and give half of them to all these new properties. >> it seems there is a lot of momentum around this. if you have a football fan in your life you know they are aup early on a sunday watching the pregame commentary. think about netflix and all the things we consume, cnbc pro. >> i know. i know. >> why are you -- you guys are looking -- you're definitely skeptical. >> there is no way -- you are assuming -- it's the same person. we are talking about the same person over just a different media. >> i'm not disagreeing that it will cut into traditional revenue streams, but i think it's going to be successful. >> well, yeah. >> that's why i'm agreeing with our guest. >> i think we all agree that's probably going to be successful, but the larger questions are where does that leave the traditional rights that have been negotiated for these games. >> drew, thank you for now. >> yeah. i will leave you with this thought, international, think international. this is something for the rest of the world maybe who doesn't watch it on their tv. now they can watch it internationally.
>> all the people in central america that are interested in the bills jaguars game. >> you never know. >> barely any people in the united states are interested in this game. >> did they fly to london just to do this at a semi-convenient time for the u.s. audience? >> i saw an nfl game when i was over there once. they've been doing it for a while. time for a cnbc news update. sue herrera is back. >> we're talking about the tropical storm an actual hurricane. hurricane patricia bearing down on mexico's pacific coast, it is the strongest storm on record. authorities warning people to evacuate. the storm is packing winds of nearly 200 miles per hour, it is expected to hit landfall is just a few hours. secretary of state john kerry wrapping up talks in vienna regarding the syrian cries, the u.s., russia, saudi arabia and turkey failing to resolve their differences. they could meet again in a week. straights and industry groups dependent on fossil groups have begun filing court
challenges to president obama's clean power plan. it aims to reduce at greenhouse gas emissions. all but two are led by republicans. nasa has release add composite image of one of pluto's moons, it's amazing, right? the single image was created by combining four individual photos taken by the new horizon spacecraft on july 14th. that's when the craft was just hours away from reaching its closest point to the dwarf planet. that's the cnbc news update at this hour. >> our sue herrera. >> those fans are all very passionate. >> this one is even crazy. pluto photos? they look like somebody went down to the beach and took some pebbles off the beach. >> you need to have a broader appreciation. >> it's a great thing. all i'm saying is i think they took some pebbles. >> the bonus culture is under
pressure again. also chris christie saying he will enforce federal marijuana laws if he becomes president. rand paul wants states to decide whether that should be legal. we will hear both sides of this debate when we come right back. here at td ameritrade, they're always working. yup, we're constantly making thinkorswim better. like a custom screener on your desktop, that updates to all your devices. and you can share it with one click. wow. how do you find the time to do all this? easy. we combined every birthday and holiday into one celebration. (different holidays being shouted) back to work, guys! i love this times of year. for all the confidence you need. td ameritrade. you got this. (patrick 2) pretty great.ke to be the boss of you? (patrick 1) how about a 10% raise? (patrick 2) how about 20? (patrick 1) how about done?
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here is a look at how we finished the day on wall street a strong close to the week, it's the first four-week stretch for the dow to be higher since the end of last year. so adding another nearly 1% today, the s&p up 22 points, the nasdaq adding 111. obviously bolstered by the tech earnings yesterday. the nasdaq up nearly 2.3% today. one hot topic on the campaign trail is marijuana legalization. just four straights let you get high for fun and even there the feds can still haul you off the to jail. chris christie says as president he would be a weed killer, but kentucky senator rand paul is all about keeping the federal government off the grass. here to debate the issue with our gate looming next week is gary johnson former governor of new mexico, also sara fagen, former george w. bush senior aid, now partner in chief political strategist and cnbc contributor with very different views. i welcome you both.
governor surgeonser, you were early to encourage the legalization of marijuana. so i'm guessing you support the stance that rand paul and others are taking on this issue. >> well, yeah, he's saying positive things, he's going to leave it to the states. let's be clear. rand paul if you ask him personally does he support legalizing marijuana he is going to answer no. in 19 the 9 i came out in support of legalizing marijuana, the notion that 90% of the drug problem is prohibition-related not use-related. really has gotten me in a lot of hot water. i think it's raised awareness. you now have the majority of americans supporting legalizing marijuana. i think that politicians, republicans and democrats, both, are just out to lunch on this issue. when you have the minority telling the majority that marijuana should be illegal and you are going to go to jail for its use, that's teirney and that's what we have when it comes to marijuana.
i think it's great that the gate is being held in colorado. chris christie i dare say is going to be in some hot water. my son just visited me from colorado and he said anybody that's coming into this state to start talking about the evils of marijuana, they are being -- they're being ushered out of the straight. there is a huge push back because none of what they're saying is true. >> share ration how would you advise chris christie or is he ultimately going to have to change his position to match the reality that governor johnson is describing? >> i don't think he has to change his position, i think he should double down on it. by every objective measure including data out of colorado their legalization has been bad for their citizenry. dui arrests, adolescent use, hospitalization including the use overall, this has been a very -- this has had a very detrimental impact on colorado
citizens and i think the governor should be where he is on the issue. one other point on this. he is a formal federal prosecutor and it should be of no shock to any of us that every person in law enforcement, nearly every person in law enforcement, opposes these legalization laws. perhaps they should -- they know something that we don't know. >> kate. >> i do wonder, though, sara, if the public opinion decided by the governor is going to be an issue here because it does seem broadly like there is a lot of support for legalization and agree or disagree there are some strong economic arguments in favor of legalizing it and then sort of dealing with the consequences once they are transparent. i also would note chris christie yesterday for the first time had the new jersey senate override a veto of his on a totally different matter, on gun control. you start to bond from in his own state and broadly there is so much disagreement on certain issues that he may not be able
to follow through with what he's saying, sara. >> i would say first of all, i think the economic data is quite mixed. yes, you would -- states would receive tax revenue from pot legalization, but the costs in increased law enforcement, hospitalization, medicare, medicaid, i think that is a very mixed bag. i will say this about the issue politically, i don't think this is a determinative issue for many people. so in many ways it is a very important debate. i don't think many people are casting their votes on this issue, including in colorado. >> governor. >> well, you know, a lot of talk is being given about -- a lot of talk is being given about tax revenue and the fact that substantial sums. i think the tax revenue gets dwarfed by the savings in law enforcement, the courts and the prisons. all of the statistics that were supposed to go south in colorado have actually gone north.
so there's just nothing to stand on. >> governor -- >> look, what about the notion of freedom? people being able to make their own decisions as long as those decisions don't put other people in harm's way. >> governor -- >> here is one really -- >> governor, i have a question for you. if you are a libertarian, sounds like you are like i am and want to let people do what they do, articulate for those who may not be as libertarian how regulation will, you know, grow or rule that will allow people who don't want people driving, getting high, driving or kids. how you -- how are you going to develop the regulation or the regulatory framework to make other people comfortable? >> well, first of all, you raised a really important issue. no one should be able to consume marijuana, become impaired and get behind the wheel of a car. but right now a big -- a big issue looming out there is right
now in colorado and washington state five nan know grams of marijuana in your system qualifies for dui. the canadian snow border, ross rigabaldi and i'm butchering his last name wins a gold medical in vancouver in the giant slal lom in snow board and tests at 15 nan know grams after his olympic winning run. are we saying that you can be triple the dui level and win a gold medal in the snow board in the olympics? the point is we should establish -- >> very few people are elite at least -- >> quick last word, sara. >> 50% of the people -- >> triple the alcohol level -- >> at triple a .9 level when it comes to alcohol, if you are at .27 alcohol level you are not going to be able to even walk. >> do you think we should lower
the limits? 50% of the people in colorado -- >> no. what we need to do -- what we need to do is establish impairment. that's a big issue out there, impairment does need to be established because it's a big issue. >> governor johnson, thank you so much. sara faye began, appreciate it as well. we will have much more coming up on the next gop debate right here on cnbc october 28th, coverage starts at 5:00 p.m. eastern time. don't miss it. >> are you can going to ask that question? are you going to talk about weed at your debate? >> 7 of the 14 republican candidates for president are or were governors, all are promising to do for america what they did for their state. we're taking a closer look at the govern nurse that's with the help of our exclusive america's top health for states business and cnbc fact patrol. scott cohn in charge of both joins us live with the latest. >> ohio where they will also be voting on marijuana legalization next month is in much better
shape economically now than it was when governor john kasich took office nearly five years ago at the end of the great recession. here is what he is claiming credit for. >> we came in here, $8 billion in the hole, a loss of 350,000 jobs, 89 cents in the rainy day fund. four and a half years later a billion in the hole, $2 billion surplus. a loss of 350,000 jobs, a gain of 350,000 jobs and tax cuts -- tax cuts of $5 billion. the largest in the country. >> did governor kasich do all that? let's take call of those claims one by one. it is true truth that kasich took the reins at a low point for the state economy. when he was putting together his first two-year budget in fiscal 2011 some projections suggested an $8 billion shortfall but those projections were based on an assumption of no increase in
tax revenues even though the economy was already rebounding. in other words, the forecast was unnecessarily grim and the hole wasn't quite so bad. today ohio does have a $2 billion rainy day fund. the income tax is down in ohio, but the reduction started five years before john kasich took office. did he accelerate some cuts but paid for it by raising the state sales tax, the cigarette tax and commercial activities tax. yes, ohio has added some 340,000 nonforeign jobs under john kasich but they have not recovered all the jobs they lost during the great recession while the nation has and then some. ohio finishes 23rd in our america's top states for business ranking this year compared to 34th the year before kasich took office. notable weak spots remain, work force and quality of life. we have more about the governors who want to be president at top states.cnbc.com. one less in the race today since lincoln chafee dropped off on the democratic side. while our series continues on monday i will be on the east
coast with the low down on chris christie. >> thank you for now. appreciate it, scott. our scott cohn. up next, we will here exclusively from shane smith on his big expansion strategy and whether he has an ipo plan up in his sleeve. find out how fan duel and draft kings are impacting the casino biz. we will speak to the ceo of boyd gaming. stay tuned. active management can take calculated risks. active management can seek to outperform. because active investment management isn't reactive. it's active. that's the power of active management. well, right now you can get 15 gigs for the price of 10. that's 5 extra gigs for the same price. so five more gigs for the same price? yea, allow me to demonstrate. you like that pretzel? yea.
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voois is growing it's empire, and a daily news show for the channel in the works it's all part of the plan to grow the global footprint. he sat down with julia boorstin to talk about his expansion plans. >> shane smith announcing from london that voois will launch a dozen new tv networks in europe over the course of the next 2 months. he also revealed voois will launch a new television network bringing vice's mel neem focused tradition to the traditional media. >> we are doing three scenes, one screen ott, a network with rogers in canada, networks in europe, networks in south america because we want to be able to go to our brands and say we can do tv, mobile, online, ott, everything. >> smith telling me that vice's profit and revenue have been doubling over the past couple of
years with revenue on track to near a billion dollars this year and double over the next two years. he also says that the company has been in acquisition talks with what he described as everybody at a $5 billion valuation. >> we are valuable. i think right now we have a decision to make because we are sort of topping out the valuation that a media company could buy us. once you get into the next wave it's either the major teleco's or apple or google. then you have to look at if we're getting too expensive for media then do we go public? that's a big issue for us, we are at the top end that media can buy us today. >> last weekend earnings call netflix says it plans to take on vice directly within the next two years. smith says he is not concerned about the competition and sees it as validation of vice's focus. back over to you. >> julia, thank you so much. always good to hear from him. casinos with exposure to china have gotten crushed this near but boyd gaming ceo has
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more more we are joined by keith smith, the ceo of boyd gaming. welcome back. >> thanks for having me on your show. >> there are so many topics in gambling to get to. i want to begin with the one on top of everybody's minds. the most interesting development is the daily fantasy stuff. is it gambling, in your view? >> sure. i think clearly daily fantasy sport is gamble. it is what we do when we set lines for a football game on a saturday or sunday during football season. it is exactly an al gus to that. >> a and so here is -- and so here is the interesting thing. in nevada, they say you have to register or you cannot operate in the state. do you as boyd gaming, keith, have plans to incorporate, if it is gamble, do you plans to incorporate that into your business model. >> sure. i think nevada came out with the right determination on my opinion. it needs to be regulated. it is a form of gambling. we're have a great year. the last four quarters the business has grown and we just
finished up a great third quarter, to with be a nice -- so it would be a nice ameantity but we have no plans to get into that business. >> let's talk about the business for a moment. again the results sort of speak for themselves and the stock reaction as well. if you read the results from the rest of the casino space, there is a drop in overall revenue and to some extent a drop -- a colleague at cnbc wrote about this, in the winnings of the house. what is going on in terms of the revenues and what is happening at the tables? >> well, sure, i think in terms of revenue, we continue to see growth in revenue and a fairly strong consumer, a consumer willing to come out and spend money with us. we have great management teams across the country that have done a wonderful job of taking the additional revenue and bringing it to the bottom line. so we're seeing retch growth across the portfolio, whether it is in the las vegas or the midwest or atlantic city.
>> where you have the borg ata here. and record ebidta. and speaking where this luck versus skill discussion that is happening out there, you had i think the free throw competition, right. should we expect to see more of those games across your casinos? >> sure. so a quarter or two ago we held a skill based tournament for a skill throwing and it is quite popular. but you with expect to see more events. it isib tended to draw new customers to the property and introduce new customers to casino gaming. >> and finally, we have to go, unfortunately, but what, to you, is the distinction between skill and luck when it comes to gambling. is that a distinction worth making? >> it is a distinction worth making. and skill requires you, as it says, to have some skill at doing something as opposed to luck of the draw or just the odds of a 21 game or a craps game, there is clearly a
distinction that can be made. but fur talking about -- but if you are talking about daily gambling sports, there is no skill as much as there is luck. >> and so interesting. keith, thank you so much. keith smith, ceo of boyd gaming there. and we should mention that nbc does have a minor stake in fan duel which is one of the two sites. and for banking, one is the bonus. but one is speaking out about the whole system. the details on what is happening there are next. ♪ ♪
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welcome back. barkleys chair john mcfarland saying investment banking bonus system encourages people to cut corners will it cause managers to quit barkleys if they don't pursue the pay structure that has long been entrenched here. >> i think it is a complicated answer to that question. u.k. regulators have cracked down in ways that u.s. hasn't. the tax system alone in the u.k. is some consider punitive and others consider warning but it is definitely stiffer. and barkleys has had a talent drain in years. people from capital markets and banking in the new york office have left within the last couple of years. >> because they were strategically smift ago way -- shift ago way from the --
shifting away from the investment banking. >> what was the quote. >> he wasn't an investor, simply ran an investment bank. >> it is like going, he wasn't a murderer, he just killed people. >> it is true that he did for a few years. but he actually ran asset management for many years. that is probably more his back ground. more recently he's been at a hedge fund which is where -- >> is the talent drain going to do worse if you do away with the bonus structure. >> you would think so. >> i think there has been problems with bonuses on wall street but this guy is the chairman of barkleys talking about it, it is not going to change it. >> i wonder if everybody does away with it -- >> but when is that going to happen. you need to have an even playing feed for that to happen. >> i do think the relatively modest bonus curves in place in the u.s. have changed behavior.
if you talk to folks that work at the large banks, capital markets, they can't leave because they are waiting for the stock to vest for a number of years. so it does increase some loyalty and unhappiness quotients. >> we'll leave it on that positive note. but we'll watch this closely. guys thank you for joining me. evan and kelly. have a great weekend. that does it for "closing bell." "fast money" begins with simon hobbs right now. >> welcome back to "fast money." we start right now. live from the nasdaq markets, overlooking new york's time square, i'm simon in for melissa lee. our trader at the desk, tim seymour, steve grasso, dan nathan and guy adami. tonight on "fast," stocks have recovered, believe it or not, all of the august losses. but something needs to happen before they can make new highs. we'll tell you what that something is. plus amazon, google and microsoft, all beating the street. could apple be next? a top analyst e