tv Closing Bell CNBC May 4, 2016 3:00pm-5:01pm EDT
down market day. >> closing bell starts right now. welcome to the "closing bell" everybody. >> pressure for u.s. stocks again today. now, if the s&p were to sell off any further into close, it could end negative for the year. so we'll watch that very carefully here and tell you what's behind this move lower again today, kelly. >> well here we've been hearing some interesting long and short positions. to include those from noted hedge fund managers. up and comers as well. and we'll have more on those coming up. also speaking live with ken
langone. and a lot more. in the meantime take a look at shares after tesla right now. dropping about 4% ahead of the afternoon's earnings release. there was news elsewhere that the company has lost two key executives. not great timing as they get ready to ramp up that new model 3. we have details on all of that coming up over the next calm of couple of here's. joining us today the brian jacobson from wells fargo. jonathan from -- is sitting next to me and rick santelli from chicago as well.
look at the numbers the weakness in the jobs number, earnings. a whole litany. but why now. >> those are the same things we discussed as the market going higher and we're going to continue talk about those a little more. the seems like the market is always a little bit behind and it takes a while to see the effect. seems like today we have a lot of things coming together. economic data, europe, china. we had a m&a deal cancel this week. so different factors out there pressuring the market. also ahead of the unemployment number, considering we got somewhat of a weak number this morning, i think investors might be skiddish into tomorrow. >> i haven't had a chance to look at the dollar index today. how are we shaping up there? it's come up a number of times in presentations. >> this could be day two where the market holds pounds.
it is up a quarterback of cent. and monday's close was the weakest in prior months. and it really is all about the dollar and the central banks and when these markets even on a relative value basis move aggressively, that transmits huge signals. multi national, export economies and that has a big worry bead added to the list that americans with the guest. committing capital at a tile where hey europe looks like maybe it's found footing bhou is the euro going to be impacted down the road and a strength in the end is going to show us a few more negatives and continue to hear from bank of japan officials. saying we could do more. and makes everybody nervous and all of this is metastasizing. the lower revenue seems to be
what most are talking about with regard to the stock market. and finally we had minus 1% on productivity. back to back negatives. first quarter this year and fourth last year. it was the same last year. first quarter of 15 and last of '14. those are two examples. i only have four examples of back-to-back going to '84 and the other two or 93 and 86. so not a good thing. low productivity is taking the toll. think japan. >> okay. brian jacobson. they are giving you litany of reasons not to invest in the u.s. and your investments you feel are outside of the u.s. right now. right? >> i do. i think if you look outside of the u.s., especially in the emerging markets those are one of my favorite areas. the biggest reason isn't necessarily because i this i the politics are good or everything is hunky-dory. i just think that basically
examinations are so low for the emerging markets. going into this year, as your first guest said about the data coming out of china being somewhat mixed also lets fold in there the low commodity prices really casts a cloud around the markets. now the commodity prices have moved back up substantially. and the data coming out of china while not great it has at least stabilized. i think that could shift sentiment significantly in the emerging market. if i had to pick an area outside of the u.s. to focus on i would be looking at doing a broad base very well-diversified approach to investing in the emerging markets. >> before we let everybody go here. i'm interested. is there any kind of read in the markets about this huge political news which is effectively that donald trump is going to be the guy? >> i think that was somewhat expected. i think the variable we weren't
expecting is the other candidates pulled out so quick after last night. now the conversation is what is mr. trump going to do moving forward. and possible vp names and a committee being put together. i think looking forward is what investors are more anxious to see. i think that was more presumed heading into the last night. >> do you have a downside level you are watching the s&p here is this. >> 49 now. we bounced off 47 a couple times and broke blow that. 2041 is going to be a tough level. >> that's what i've been hearing aez well. thanks guys. it is trump versus clinton apparently. the two shaping up to be the likely candidates for each side of the aisle. what effect would these two leading presidential candidates have on specific sectors of the economy in the stock market? bob pisani has been digging into that for us. bob. >> and a lot of issues really need to be clarified.
a lot of vagueness. but two particular issue s dodd-frank and the banks and energy. banks and dodd-frank. clinton is accused of being soft on wall street and too close to them but a strong supporter in dodd-frank in general. trump's position is tougher to discern here. he's talked about being tougher on the banks and also described dodd-frank as the disaster. the regulators are running the banks and the banks have been scared and they aren't loaning money to people who create jobs. energy, clinton's been a big supporter of solar and alternative energies. national goals to have 500 million solar panels put in soon. much less support voiced from her for oil and coal. trump is trump was a back over the keystone pipeline. and a back of coal and ethanol in general.
so for example, recently bank stocks have been weak. but they have been weak largely because the earnings season is mostly over. so you see banks down 2 or 3% today. energy stocks have been weak. oil has had a lot of problems breaking through 45. and most of the commentary from companies have been very conservative. so there are other reasons other than the candidates why. i think what you are going to see now is a lot of pressure to get more specific on issues like defense for example and how they feel about those issues and what's going to happen to those particular sectors. then you are going to see wall street sit up and take a lot more attention. guys back to you. >> thank you for now. bob pisani. well someone who's been very vocal about the republican presidential race is ken langone. co-founder of the home depot. john kasich we learned today is suspending his campaign. mr. langone joins me here at the
conference. >> kelly, how are you? >> how are you? and have you spoke on the mr. kasich today? >> no i have not. i know stan talked to him. >> what do you think? >> i well it is what it is. based on this past year i wouldn't listen to the pundits and the journalists and consultants can the advisors because they have all been wrong. trump didn't spend that much money. so the money wasn't the difference. i think this is healthy. yeah. i think the fact that we break out of this cabal between journalists and -- you know, you guys go from the political world to being a broadcaster to back again. so i think we're at a point in time where the american people are saying hey forget you guys, we know what we want. we're not happy. and we're going to do some drastic things and that's what's goingen. >> we know the approval ratings are quite low for a lot of institutions. the question everybody has for you is do you say now all right
donald trump is the guy. -- >> absolutely. >> -- >> if kasich is the nominee for the republican party? i'm all in. and do you want to know something? i think he'll do a hell of a good job. at least i'm hoping. >> do you think he can beat hillary clinton. >> oh i think it is going to be a run. no pun intended. but i really believe that one -- when the world looks closely at hillary, they are going to start asking, or at least the americans are going to start asking questions about what the hell's going on here. >> people always raise the character of trump here as we've moved through the process. and you have probably crossed path with him a number of times. >> -- never had any adverse experiences with him. i know people who have done business with him and they have had a good experience. you hear stories about his business practices.
you can't prove it by me. i will tell you this. look around the city. it is not easy to put big buildings up in this city. he does it with great aplomb and he does nit an effective way. >> hi bill. how are you? >> i'm good. good to see you my friend. if we do have a president trump let's say, those in the business journalism world are trying to figure out what's going to do to the economy and stock market. can you point to any possible trends or policies that he might implement that you could see opportunities for? >> yeah. let me tell you the biggest need we have in this country. we've got to get rid of some of these insane regulations that serve no good purpose at all. and trump will do that. you look at what's going on -- how the hell can we worry about the next 8 years after what we've just come through the -- >> -- frank?
>> -- get that. like dodd-frank. like sarbanes oxley. we didn't need sarbanes oxley. dodd frank is a nightmare. a nightmare for the people governed by it. and it is going to drive cost up for the consumers like you can't believe. >> but no president operates in a vacuum. you know that. he's got to have a congress. we're going to probably have a split congress. maybe even leaning towards the democrats. how is he going to get anything done with what's been going on in washington? >> let me tell you what. if this congress doesn't get it, that the american people are fed up with the political class, they deserve to go home too. and they will. this is a -- change. the american people are saying we've had it. we've had enough of these professional politicians. we've had enough of all of these people that make promises and tell us this and that and things get worse. they don't get better. >> would you say a new lease on life for coal? >> coal i think has problems.
but on the other hand. they made a whipping boy out of the the banking industry. a whipping boy out of the wall street. i admit i'm partial. i came from there. but the fact of the matter our capitalistic system has benefitted mightily by wall street and the banking system. job creation, invasion, you name it. >> who's going to be the vice presidential pick? >> he said something last night that i found profound. he said i'm probably going pick somebody who could help me in the political world. very practical. he's got to deal with congress as bill pointed out? >> now don't think that will take some of the -- >> no i don't think so at all. i think he's going to be the president. and whoever he has around him are going to be people to help him get things done. i will tell you this. there's never been a riper time in america for term limits. and if you want to fix this mess, you get term limits in the congress and watch and see how fast things change. for the better.
>> and by the way, before we let you go. we're talking about an environment where people are worry -- we heard the productivity figures this morning. they are concerned about growth. would you go so far as to suggest that trump presidency really could see a revival here of growth in ways that we haven't been able to identify but that just have something to do with the halo -- >> let me answer it this way. we can't be in any worse shape than we are right now in terms of strangling the economy with these insane regulations. government is the problem. government is not the solution to the problem. and more and more, you go into business and you say to business people, what do you need most? i need to get these bureaucrats off -- do what you have to do. i'm not suggesting we throw all regulations out. but i think a careful analysis -- >> hard to unravel that, you know? is there a great precedent for
unraveling -- >> it is only hard if you have a congress that hasn't got the courage to do it. and that is my point. i this i congress is going to have to take a step back and say what is the lesson for us in this political season. >> one final question. on the issue of trade. do you have any issues with the core concept of free trade. >> not at all. i am a proponent of free trade. >> so the center piece of donald trump's campaign to this point is protectionism. >> george bush said read my lip, no new taxes. how long kid that leave about two years? i'm not worried about. when trump becomes president. he's going to have a different point of view about a plot of things. >> you think he's a pragmatist at the core. >> there is r there are some things we can do to enhance our standing and world. and not to least of witch is regulation. we've got a mess on our hands. look.
one last thing. the department of education was founded in 19 -- thereabout, '78 by jimmy carter. the spending for -- has gone like that. at the same time the spending is going like that. the results of our children's education have gone like that. where is the payoff for all the money we spent on education? where is it? our public schools are in shambles. we are a degrace for a nation. 28 out of 30 for developing countries. and we spend more money per student -- >> gold -- >> what about gold? >> -- >> -- it's okay. >> seems to be a hedge against the world falling apart. so it's an interesting time to want to be doubling down -- >> i have a simple approach. let me find great companies. let me invest in them. let me look at the balance sheet, earnings statement,
dividends. i'm fine. stocks go down. >> any names. >> i got a munch. home depot of course. eli whitney. i got a lot of small companies but they are too thin to talk about. the point i'm making there are great investments out there. my style is simple. find a great company. look for a good entry point. when they go down, buy more. when they go up, never sell. >> a that's what this conference has been all about. >> ken langone. many much more coming up. >> we'll take a break here and come back. 43 minutes left in the trading education. is the dow down 103 right now. more ahead. duke's behavioral economist on market and voter psychology. hedge fund rising star --.
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tesla shares down right now. two key seexecutives are leavin the company. fill lebow steps in with the latest wrinkle in the executive suite there at tesla. >> important change because it comes in the manufacturing part of the business for tesla. and that is really where a lot of the questions are for investors. can tesla increase manufacturing and do so in a smooth fashion? they have had some problems. the departures that were announced today. the vp of production and the vp of manufacturing are both out of their jobs. this a couple of months after problems with model x. production. that is the electric suv. all of that the reason we saw shares under pressure most of the day today. despite the fact that elon musk was out with a statement shortly after we contacted them saying
look these are the guys who are leaving. this will be a transition. i'm confident in the team for the model x. we'll make this a smooth one. but all of this reinforces the opinion of -- who thinks tesla is in trouble. >> one of our historical sign posts of a company in trouble is when numbers of senior people leave over a short period of time. tesla fits that bill. we have a chart that we've had. i guess we are going to have to update it this afternoon. of senior executives leaving tesla. is a flood of people leaving. and that is not a good sign. this is a company that's cap forecast delivery is one quarter out and yet everybody is confident what they are going to make in 2040 or 2045. i want to see them make the model 3 and sell it profitably. i don't think they can do it. >> tesla's e coming up. and then the conference call a
little later on this afternoon. >> looking forward to that phil. thank you so much for now. there is a special guest at the sewen conference today. and he's being honored for his work in fighting childhood cancer. eli manning. you know him for quarterback as the new york giants. a grant aimed to provide long-term care for pediatric cancer survivors. eli joins me now. how did this partnership come about? >> past couple of years been working with an initiative called tackle kids cancer in hacken sac, tennessee. and trying to support the care and treatment and research trying to find a cure for pediatric cancers. and the care had a long history at hack en sac and put this together. and the long-term effects and
beating cancer and making sure the kids are taken care of. so it is a great conference today and really an honor to be here. >> getting some stock picks here? >> yeah i took some notes from stan and a few other guys and it was going way over my head. >> you have childrens clinics in mississippi already. are people coming to you because they are aware of the work you are doing here. is this something we can expect you to expand on over the years or if people need the support just to be able to jump in and provide it. >> yeah, this started out just making visits to hospitals to visit sick children. and something that every time i would visit i would want to know what i could do and how could i do more. and in college early on, making. and then it's events and making programs and starting programs
and fundraising and asking people to donate and have events. and you see the impact it is making and i've been very fortunate to team one hackens k hackensack. and come to this event and if it's helping children, i'm on board. that is the whole goal and trying to find a cure for these childhood cancers and getting these guess back home to family and friends and get them to be able to start being a kid again. >> clearly a compassionate guy. so should tom brady be suspended this fall? >> that's not up to me. that is a whole different category. i'll let them figure that. that's more complicated than some things -- >> does it help as a quarterback for there to be less air in a football? >> you know i'm not sure. it may. but there are rules and i don't
know if he broke any rules or not. so again i'll let the nfl figure out all those deals. >> what are your thought s s ot apple. >> i'm excited. his mom said he's similar to me. >> how so? >> his mom made some interesting comments. so i'm looking forward to it. and seeing how everything goes. >> what is your point of view when it comes to the draft? i'm reminded a little of lebron james and the nba and how involved he gets sometimes with the coaching and execution of his teams. when it comes to the nfl draft do you make it clear how you feel? and what you are looking for out there. >> so many things can happen in the draft and you can decide hey we're the 10th pick and now all of a sudden guys are trading up
and so many things are going on. so the giants organization has so many people on staff, that is their job to figure who is the best person to draft. and they do a great job. and it is my job to play quarterback. it is my job to go out there and throw touchdowns and try to win games. so i'm just going to stick to doing my job. >> and not get girard. ha . >> -- you have never had a concussion in your career? >> no. >> i thought it was so common place. >> not every players has them. i know that is what everybody thinks because you hear so much about it. and we've had guys claim they have a concussion and feel great the next day and you have guys take weeks to get over them. so i think there are probably
different levels of it. it is dangerous. but i've been very fortunate. always wear the safest helmet and newest product out there to hopefully prevent me from having one. >> helping make sure they keep guys out there safe, protected and able to have long careers. we know you have to get back to the football field and all that with an eye towards the fall eli manning. thank you for joining us. >> my pleasure, thank you. >> bill back to you. >> yes, ma'am. good high hopes for the giants this season. and you even snuck in the tom brady question. nice try. just over 0 minute 30 minun the trading session. not just tesla but a slew of earnings tonight. fit bit and whole foods. that's all coming up on closing bell. stay tuned.
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a specialty doctor before he died. nissan is recalling 108,000 rogue suvs in the u.s. it covers the vehicles 2014 to 2016 model years. nissan says there's been no reported incidents in the u.s. and in effort to warn driver, sprint has unveiled an ie catching sculpture in downtown miami. that is a cnbc news update at this hour. back to you. >> we'll take a break here as we head into the final half hour of trade for this wednesday. the dow down 103 points off the lows. a leading trader will tell us what he's watching as we head towards the close. and our special soen sompbs continues. and dan ariely and adam fisher
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coming out and making their long or short cases for particular names. o zarkss down 3.6% today. carson block going through a --. a little rock, arkansas based firm. and by the way the speaker after him said we feel the same way. chief investment officer telling cnbc. amazon is also session lows today. amazon could be a $3 trillion company a decade from now. he said --. current market cap around $312 billion.
this would be a 10 x multiple in a ten year period of time. it is the first publicly listed company where he sees that kind of opportunity. and just now jeff gundlach saying some stuff. >> the last time you and i stood here. we had a rally day. and you were skeptical of that rally. you were expecting a selloff before you would think about getting into the market. we've had two pretty good selloffs here in the last couple of days. >> we got in the other day. we're holding the position. but it is very volatile. and do you know what worries us the most? a lot of the big names, price
line down today, first solar, apple. a lot of these leaders are selling off. so where are you going to put your money? people are worried. >> earnings are the big catalyst right now. and a jobs number on friday as well. >> adp have been good. >> that was weak. >> that was very week. we get the job number friday. and energy is always in play. even though it closed fractionally higher it still was down big today. >> so you're in the market here. >> we're in here. >> thanks for joining us. when we come back, we're still waiting for the top of the hour. we have a number of earnings reports still to come here. fit bit, tes larks whole foods. 21st century fox just to name a few. when we continue that's on "closing bell" after this.
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regeneron and celgene. >> i'm live here in new york city. investors getting ideas where to put money to work in this industry. and redeposition demonstrations for the first quarter in something. where are the opportunities out there? thanks for your time adam. this is -- can you share them here. >> i can't share the specific idea but i can talk about the broad -- the broad view. >> and that is what you -- >> -- macro. >> global macro fund. we just heard sam druckenmiller
up there. i don't want to say ticking time bomb but there is a lot of concern. how would you describe the environment? >> well it's obviously complicated. we're seeing negative interest rates. which to us. we trade a lot of interest rates. so if you ask people 8 or 9 years ago whether you would have envisioned there would be negative interest rates. they would have said absolutely not. >> they look tot the john maynard cainess and everybody who spend no time on this concept because here we are presented with the reality and the theory doesn't fit. >> it's certainly a tax on cash. that's clear. and they are doing it the bank of japan, the ecb because they want to encourage inflation. they want stimulus. but let's think about it. if we go back to macro 101, you
wouldn't pass a tax increase if you wanted to stimulate. so these guys have added taxes to their economies when they should be doing the opposite. >> but it started with that intention. as a way of saying we're going to prime the pump. we're going these asset purchases and what have you. and sounds like a step too far and going negative a quarter percent does matter rather -- >> you start at 5% and go all the way down to zero and things aren't working well all the way to zero so you just reflexively say let's keep going. but once you get past zero things get a little crazy. you don't really know how people react that. >> does that mean people have a point or they need a different tool. >> well you are definitely going to need a different tool and the tool is likely fiscal. >> [ inaudible ]. >> and if you think about where central banks are now and you
look back maybe 20 years ago, they would all have said 20 years ago that everything they are doing now is quasifiscal. so they are already doing fiscal. their problem is they don't want to cross a red line. they don't want to just hand people money. the more of the same of negative rates is what they have chosen to do but that is a problem. >> change of leadership at the white house. so how is all of this going to work? on the one hand extraordinary monetary policies that, you know, maybe argue for something out of the government side to happen. is it going to happen in the right way to support markets here come november? >> the u.s. is obviously the place where things aren't quite as dangerous. we're not at zero. we're not negative. our 10 year government bonds actually have a yield as opposed to germany and japan. and trump's -- people haven't yet start talking about trump's economic program. but it is very, very
expansionary. when you cut taxes that much and you can't cut spending that much. >> helicopter money. >> yeah it's helicopter money. but the places that need it the most are japan and europe. and europe is really in a tough place because the germans are never going to allow that, or difficult to allow that. >> but from the point of view of this discussion then trump would be exactly what is needed. >> trump is going to be help -- well, on that specific issue trump might end up being quite helpful. but one thing worth pointing out is the euro is going up. the yen is going up. and these are things that are very very hard on those economies. so they are applying some pretty bad policy and they are getting bad outcomes. so it is really those guys you really need to worry about. >> a good place to leave it. adam thanks for joining us. >> adam fisher from commonwealth opportunity capital, bill. >> great stuff. we're heading to the close, 14
minutes left and the market in comeback mode right now. the dow down just 70 points, was down 71 at the low of the session. it is a thunderous round of earnings out of the bell tonight. fit bit and whole foods are a couple. what is freedom? yes, it's riding a horse across fields and stuff but it's mostly getting to watch your directv with unlimited data from at&t. we're setting families free. so they can stream away - and not squabble over who's using how much. so go, family. watch. freedom. seize the data! get unlimited data when you have at&t wireless and directv. switch now and get $650 credits, per line. i'm in vests and as a vested investor in vests,
comps were down 2.8 percent in the first three weeks of the kwur going to be reported in full after the bell today. the streak thinks the trend improved but just to negative 2%. still a contraction from last year. investors are hoping to hear more how the company plans to retain shoppers in the face of competition and pressure from lower prices across agencies analysts are looking
for more stuff. joining me at the top of hour. here is the auto over the seven pearls of financial wisdom. i wish we had time for all seven of those. what have you made of the earnings season so far is this. >> i think we're in sort of a dull drum market. companies are just about making markets. they are severely punished if they aren't so they are guiding down very careful. making sure there won't be any truly negative surprises. >> you're telling your clients to lay low. >> right. it is not the time to get overly excited. but it is not to time to run for the hills. by the end of the year we'll see a pick up in earnings and i think things will look better. and watch fash rally at the end of the year. i think we're find one. >> if todd pick. jeff gundlach would saying he'd go long reits and short utilities. anticipating higher down the
road. >> that's not a bad trade. and some of these reits just have good skperngs giving you a lot more than fixed income for the people that are looking if are income. >> what about technology? >> technology is going to be saying why are we looking back. if you are not in tech, tech is a good category to get in. bigger is better. amazon, apple, google. forget netflix in my opinion. but the big names are really going to serve you well over the long-term. put those this your retirement accounts and you will be set for the future. >> why not netflix? >> well they are a one trick pony. i don't see the national rollout really saving them and unless they widely expand what they are doing, i think they are going to be easy to be eaten. >> what about energy? oil prices have come back here to some degree even though we are getting more evidence that they are still pumping wildly right now at opec. >> they are pumping wildly and
all the containers around the world are filling up. so i think this $50, $40 a share price could be a head fake. we could have lower again before we go up. so don't get too excited just yet. there is still a lot more oil around and i don't understand this price. >> lot of money managers will point to some of the oil joints that pay such an attractive dividend. >> if you are going to stay in oil, stay in the biggest names. bigger is better in any market that is defensive. that is just a safer place to be. >> as a friend of mine likes to say, when the waters are turbulent, sailors like the big boats. >> absolutely. >> let's go for a luxury yacht. not even a big boat. >> i got it. carol, thank you. upcoming we have a closing countdown and after the bell we're minutes away from breaking earnings news. fitbit, tesla, whole foods, 2 st
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2:30 left as we head to close the dow down 95 points. the s&p how to for the first three days of the week. rally monday, selloff yesterday. and more selling today. for the week bob pisani, down two-thirds of a percent for the month of may here so far. what do you think? >> so far you're right on the old cliches. ism services were pretty good this morning. that was the highs of the day essentially and then we just sort of came off there. a lot of people asked about the bank stocks. we've been weak for four or five days on the bank stocks. down about 3% or regionals. going into the earnings season, they did the predictable thing. they all ran up. all ran up. three or four weeks ago. as we entered earnings season. the bank index the last week. and in the last few days they have been weaker. so it's been up going into
earnings season as earnings season has come off, they have come off too. >> a full spectrum of companies reporting tonight. way too many to get to all in the next hour. but we will be highlighting for example, tesla, fitbit, whole foods. and 21st century fox. >> we know margins are notoriously slim anyway in whole foods, does that make their margins that much slimmer is this. >> definitely. but i this they they have to. they are bumping up against their ability to grow. they have basically gone in all the markets they could. so it is a natural thing. if they can do that and keep up
the quality, i'll essenticertai follow them. >> [ applause ] -- towards the close of trade. jeff gundlach won joining us in a little bit. ringing the bell here at the new york stock exchange. stay tuned for the second hour of the "closing bell." hi everybody. bill will be joining us in a moment from the floor. here is how we are finishing the day on wall street. the dow was in negative territory much of the session. closing down about 99 points. the s&p down 12. the nasdaq the underperformer again. despite amazon getting a lift here now investors are getting
ready for earnings after the bell and we have reporters standing by. phil lebow in the driver seat for tesla. josh covering fitbit. and i can't keep up. >> as soon as those results all hit the tape. and as i mentioned bill will be down there. alongside cnbc senior markets commentator and pro columnist michael --. john najarian as per usual. and with comments out of the conference, what do you make of the overall tenor of the markets here? >> another day of relatively gentle pullback type action. seems like a lot of the drivers that got us here are at least reversing on a short-term basis. you had the dollar flieding up.
it had been sliding. the market here in terms of u.s. sox is trying to digest whether the whole dynamic has changed or just having a pull back. i think the vix tells you right now it is just kind of a no big deal pull back. . we're trading almost exactly flat year to date. >> what's causing this doc in your view? >> nervousness from the fallout continued from carl icahn's comments. as well as disappointing earnings last week. as great as amazon and facebook were last week, there were a host of others. alphabet, i was gonna say google. >> still you have to to get to that. >> it's tough to spit it out. however, i think mike nailed it as far as the reason we're so flat is that crude oil isn't giving the bear what is they need. they need a two or three dollar swoon. they are not getting it.
every day it trades up. comes off. goes negative and just like today finishes up about .6%. until they get that break it is going to be tough to break the market. >> why duke that is? we're getting ufd that the build up continues. they are still pumping big time. and reserves reaching record levels and we're still well above 40 a barrel right now. >> the market is captivated with the idea that we got some really important low a couple of months ago. the dollar has been a help to it for a while now. and dollars not exactly rallying hard. so that remains in place. and incrementally i don't think it has to say at these levels. and the producers selling forward and trying to lock in prices. maybe people feel like look it is not going to be up and away from here but we've created a base that is it is not an
outright short just yet. >> kelly evans at the zone conference with a special guest. >> joining me is jeffrey gundlach. thank you. and as mentioned we're going to get a ton of earnings here. we'll keep this focused in on that. let's start with what you basically said which is negative rates are causing deflation. am i going too far there? >> it's pretty obvious that negative interest rates are deflation. form of a tax on wealth but also outright deflation. if you have a hundred dollars and invest in a bond and you get 98 back at tend of five years, that is deflation. so it's not a good idea. >> it echoes what adam fisher told us previously as well. which you know what, it turns out there is a difference
between having -- >> ever since the rates went negative in europe, the dollar has weakened and the euro has strengthened. same in japan. the euro stock market has underperformed the u.s. since they went negative. the japanese stock market has been terrible since they went negative. so one of these days the policy makers are going to realize that negative rates are a problem. but if positive rates are a problem and negative rates are a problem. you got a problem. so the only solution has to be on the fiscal side. >> that also seems to be a theme that people are coalescing around here. what about quantitative easing. to some extent the research seems to demonstrate that works kind of the same way. >> quantitative easing seems to help stock markets pretty well but negative interest rates don't. i don't think we're going to go back to quantitative easing in the united states. i think it is very unlikely. they are doing it in other countries. and maybe it is helping. but i just think these balance
sheets look awful big and the debt problem is tried to be solved with more debt. the central bank buying sit partial solution. i've biv given away helicopter money forrise. >> ultimately -- >> or you could print it. just outright print it. but that actually would bring back inflation. i can bring back inflation. it's 4:00 now. by 5:00. we announce that we're giving everybody 1 billion dollars. the lines at the ferrari dollars would be smog to behold if the price didn't go up. so problem is how do you calculate so you don't fro deflationary to unpleasantly high inflation rate. and that is going to be the challenge. >> donald trump is going to win. i've been saying it for months. >> you didn't think he was going to get the nomination -- >> what are you talk about.
>> -- >> -- barons round table and i was asked who's going to be the next president and i --. i think what will happen is trump will have a very large deficit. he says he's going build a wall. he's got to at least try. he's going win. and he's very comfortable with debt. we know that about donald trump. and just like ronald reagan. do you know the slogan in the 1980s? >> no. >> it was let's make america great again. it actually was. so it's sort of reactionary. he's more like reagan than people i think. and the question is will he boost the economy from infrastructure prices and the like offset the potential drag from shrinking global trade. >> usually infrastructure of highways and airports, not necessarily a wall along the
southern border. >> he talks about airports and the infrastructure. and he's right. i was taking a taxi in and we go through met life building i guess it is. and the place looks terrible. it is crumbling. falling apart. bridges. china has a 130 new airports, chinese cities with nobody in them and -- >> -- america or -- or would you rather be china with shiny infrastructure but frankly it could be a giant house of cards? >> i would rather be united states for sure. very mist trustful of thorton e economists. so as od as our political process is. which has been laid bare by donald trump. look at what he's fought through and won. >> and are you worried in a environment where the chinese leader sxi jinping is cracking
down and challenging other countries in the south china sea. are you worried that donald trump and his character or however you want to describe it could cause some kind of global -- >> i'm just predicting things that could happen. i'm not a policy maker or a central banker. i'm very apolitical. i just perceive that this is going to happen. so i think it is important for investors to deal with reality. somebody said when i said in january trump is going to win i they said no way. they want want it to happen. but in investing, hope is not a method. you have to deal with reality. and i believe -- and i'm wrong maybe 30% of the time, i've gotten many things wrong over the years. --. >> so we talk about your investment recommendations today. it was to go long the mortgage rates and short the utilities. that is sort of a specific
valuation. >> well they should move over time. and they have historically they are highly correlated because they are interest rate sensitive and they are yield proxies. and so utilities have done incredibly well. and the mortgage rates since middle of 2003 have a negative total rate of return. so the valuations have gotten incredibly stretched. and if you own the reits. you get 11 plus. if you own the utilities you get 15.3. and i'll bet dollars to don'ts the two prices converge.
>> what would trump look like? >> arms manufactures maybe. -- >> you think that's a real thing because ken langone earlier suggested, you know, he's saying these things but he's a pragmatist at the core. >> sure. he's going moderate his positions but just like president obama had to deliver something on healthcare. he promised that over and over and over again. and donald will have to at least try to build a wall. at least try to do something with jobs. try to help the -- how far? i don't know. but he's got move in that direction. he can't just say i was just kidding. >> so core stuff here. hour marks was saying has -- >> 50 x.
>> 50 x is money. >> in 6 and a half years. >> how do you -- >> i don't think you do that ever again. just like someone was saying on cnbc yesterday. you know, apple is not going to go to a $5 trillion company in the -- >> what do you see out there the opportunities to really make those kind of transformative trades or investments? >> i think that like my recommendation here i think people greatly over believe things to be save. -- and then they all -- >> [ inaudible ]. >> subprime in a big way. sub prime aaa floaters thought
how could you lose on this? and dropped something like 80%. and i think once the investors start to experience red ink they are going to panic and sell. so i'm fond of shorting. i run a little macro hedge fund. . stan drugen miller. i thought his presentation was excellent. it is like a 30 year theme. but many of the things he points out. we had a massive bull market because we had high interest rate asks very low pes back 35 years ago. and there is a lot -- >> but here is what i don't understand. if he's right but you are also right we're going to have fiscal
stimulus coming couldn't a -- >> the timing is so tough. because he's talking about the monster theme. and the theme of fiscal stimulus has room to support things. but you are really playing a dangerous game because you are trying to pick up dimes in front of a steam roller. >> so on the bond side, you could look across that universe and there are a lot of things that are incredibly ps expensive. parts of high yield that are cheaper and always individual opportunities there. in that space, where do you look and say, okay, here is an opportunity to really generate great returns? >> yeah, unfortunately it is in sectors that are difficult for individual investors to participant in. they are largely institutional markets. we do a lot of things with marge backed securities. our total return fund is cool. the higher market is challenged
with the leverage in the high yield systems challenged with boenl global slowdowns. maybe not ongoing robust energy crisis. but the -- market doesn't have those risks. lower gasoline does not make people default on their mortgage. lower gasoline makes them pay their mortgage or at least have the wherewithal. and there are opportunities of yields of 10, 12% in cnbs market. so again it is a narrow thing. don't try it at home. but it does exist within funds. one of the reasons why some funds yield more than the asset class itself. >> before i let you go. one of the things people are trying at home is tesla. stock looks up a little after after hours on earnings. >> i've liked tesla for years because of their battery technology. and i've told people, elon should just have a battery
company. if he could create batteries that powered houses that could store enough money. if that happens it's truly transformational. so this binary outcome i think it is worth it for a lottery ticket. one of the most transformational -- >> this is an expensive lottery ticket. >> yeah. >> it is not buck. >> it is expensive. but the potential transformation of going from a power line to a battery is like the telegraph was back in 1840. transformed the world. if you had really powerful batteries. you would be a transformal company. he has the potentially to do that. so i -- it is very expensive. it is very volatile. so buy it at 200. >> what about apple which never hit 200? >> i said short apple four years ago. i said it is going to 425.
it did. we bought it at -- i'm talking pre split. because i don't really follow them anymore. i do have a real problem with apple. in that steve jobs was the man. and what is their product cycle going forward? and i talk about that in 2012 as one of the reasons for my bear case. but it is not expensive. >> no. >> you know, and there is a lot of cash there. so i just -- you don't have to take a position in something. i think apple is going to be diminishing in importance looking forward a generation. >> i know we have to go but jeff bezos is now getting a little of that effect, that steve jobs effect. and we say that could go by ten times in ten years. >> if only a profit margin of 2%. that would be wonderful. >> thank you. important interview.
lot of great stuff. great job kelly. while they were talking you could probably see the lower third of the screen there. lots of earnings coming out. tesla out moments ago. phil lebeau. how'd they do? >> one reason shares are higher is because numbers came in roughly in line with expectations so a relief there. a loss on a non gap basis, of 57 cents a share. one penny better than estimates. revenue in at 1.6 billion, just a smidge higher than analysts called for. so why are investors optimistic after hours? two delivers, tesla expects to deliver 17,000 vehicles. that is shy of what some estimates are out there expecting deliveries to be closer to 19 or 19,400 vehicles and if they hit that 17,000 target, they will have delivered 31-80
31800 in this firsomething or o. tesla because of its optimism of the future is moving up its target for building a half million vehicles annually. remember it used to be at 2020 was the target. they are moving that up two years. tesla is now saying by 2018 its annual production of vehicles will be 500,000 vehicles. moving it up again by two years. couple of other notes from the earnings letter. the gig factory is on target to deliver first battery cells by the end of this year. and the model x the production issues we saw earlier this year have been resolved. the big head line. moving up the 500,000 target by two years is going to get a lot of attention on the conference call starting next hour. >> you were nodding a lot during that report. i guess we got your attention. huh? >> sure did. because this isn't just a small move. this is a massive move.
>> we understand why to some extent that he could make such an estimate and that is because of the pre sales of the model three and so forth. even though they were only a thousand down and are refundable and that sort of thing. those numbers were mind boggl g boggling. especially with two production engineers leaving, bill. he's basically drawing that line in the sand for himself. or maybe even at an edge of a cliff and he's pushed himself right out to the edge of that cliff. because this is a huge hurdle now. 500,000 has to be there by 2018. if he's 100,000 short, which could be. he's got to do 49 thousand the rest of this year just to make targets for this year, that is a huge leap for elon musk. he must be supremely confident to to make that kind of estimate out there. >> phil do you have more? >> i do.
with regard to the model 3. i think people were hoping for terms in total reservation. that may come out on the conference call and no doubt i and other reporters will be asking if there is an updated number. but as of right now. the most recent number that we have from tesla is what elon musk himself said in europe a week, week and a half ago when he said they are closing in on 400,000 reservations for the model 3. >> who's got the longer waiting list? denver broncos season tickets or model 3 orders there? thank you phil. let's go on to whoele food s. >> earnings are coming in with 44 cents. that as beat of analysts expecting at 41 cents. revenue though slightly below expectations at 3.7 billion dollars. analysts looking for 3.74.
comps down. so far the first three weeks of the current quarter looks like that trend has slightly improved. conference are down 2.6%. that is of course below what analysts are looking for for the full quarter but we're just three weeks in. looking forward the guidance also disappointing. whole foods is saying think expect weaker comparable sale, revenue and eps lower than previous guidance range and due to recent abc actions in the ma. -- in california. so perhaps there is hope there. co-ceo walter rob says the company believes there is room in the market for both formats and that sort of answers the
question about cannibalization that many are afraid of. back to you. >> so let me get this straight, mike. revenue miss and they are guiding lower and the stock is up 5%. >> that might be a measure of exactly how beaten down the stock is. keep in mind, around $28. about half what it was last year in february. talking about the price it fetched in 2011. i think what you are possibly seeing is maybe people testing the idea that we have some kind of a long-term turn here. don't know this is going to last through the conference call. we never know that kind of thing. but trading as people are braced for worse. >> let's get to fitbit. josh lipton, to be down sharply, what happened? >> so fitbit reporting eps of 10 cents. the street was looking for 3. reporting revenue of 505 million. analysts expected 404. a beat on the bottom and top.
disappointment though in this report. fitbit saying it sold 4.8 million devices. that does miss expectations and analysts expected them to sell around 5 million. gross margins about in line at 46.3%. the guidance is disappointing. q 2 revenue, 565 to 585 million. that beat expectations. but fitbit is also guiding q two eps of 8-11 cents. analysts thought fitbit would guide for about 26 cents. really undershooting there. the full year. fitbit looking for 2.5 to 2.6 billion dollars. on this call we're going hear more from the competitiexecutiv. into this print fitbit had been on a recent run, up about 40% since that february low but now heading lower here in the afterhours. >> thank you. d.j., looks like the guidance is
what took the stock down here. >> the guidance, the miss with the number of units sold and what's the cap ex. how much are they going to spend for this innovation they say they are going to deliver? and that is something the investors, they wanted 25 cents or more out of the earnings or out of the bottom line number they are going to do next quarter. they are not going come to half of that. and that is because they are going to spend on it innovation. if on the call they have something that really is a wow product, which they probably won't have by the way at this point, then that would save it. otherwise yeah the shares are going to remain under pressure. >> lot of competition in that category. >> and people also losing enthusiasm for the category. >> we know how many fitbits are in the interedrawer at home. >> this is on my wrist. >> mine is in the drawer. >> still to come more.
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welcome back. those results from the 21st century fox are now out. julia boorstin has the details. >> fox moving higher. they are now up less than 1% but the company reported revenue better than expected. fox reporting nearly 6% revenue growth to $7.23 billion. earnings coming in line with projections at 47 per share. the company's cable tv really drove the upside surprise. saying saw higher affiliate and advertising revenues across domestic and international tv. and it is interesting the film and entertainment business saw --. revenue came in slightly lighter than expected but earnings was a much bigger number than wall
street. statement said the company's brand content will drive the business forward in existing and evolving media landscape references opportunities in distribution. >> julia, thank you. that stock round turn. big rally on initial news and it's come back to neutral almost there. tesla, up 5.5% right now. after it reported quarterly numbers moments ago and ramps up production by two years. we're joined by -- no you have the short on. and james al ber teen, as john
najarian point t out, they have drawn a big line in the sand ramping up production expectations two years. ambitious or encouraging to you? >> thanks for having me. in our preview we talked about three things. guidance being relatively unchanged for this year. 80 to 90,000 units as expected came in. also they are walking back cash expectations. they are using the model 3 demand. fulling forward the 500,000 units because i think they are telegraphing a need to go back to the capital market. there's always been a execution risk beyond the orders for the model 3 orders. we expect on the call hopefully they can walk us through how to they anticipate executing on this accelerated timetable?
>> i think they are not surprise they are moving production up. by early 2020 electric vehiclers could be cheaper than like for like cars. and given how they have done we see underlying demand for tesla vehicles coming in at one million per year by 2020 which is even more than they can supply. >> so are you rethinking your short or licking your chops now? >> i think the problem with tesla is that it is a really small tiny car company, valued like it is a big company today. and i think it is going to cost a tremendous amount of money to build plant capacity to get them up to that amount of cars a year. if you look at how tesla exists is that they bought a toyota plant in freemont, california for like 40 million bucks.
you can't do that again. they are going to have to spend 3, 3.5 billion roughly which is what honda spends roughly per factory on building these plants and they need another giga factory. and talking a 5, 10 billion of cap ex to get them to be a sm l smaller car company and --. >> stuff soon. so even if they can get to these production targets long-term exactly how much capital is this company going to have to raise and consume before they can be viable and justify current valuations? >> i think the other a guest's name is john. i think he hit the nail on the head in terms of the capital need longer term. in terms of additional production. let's just focus on the immediate need for the
production line in freemont. and the giga factory. they have partners in pan sonic. quite a bit more than what anybody was anticipating the end of last quarter when they said they would be free cash flow positive. this is a little negative signal granted i am still positive long-term. >> doesn't sound like anyone's changed their opinion on this company after what they have heard so far today. thank you. >> reporter: coming up we're going to get another check on this wild after hours earnings session. and why do some investors refuse to cut their loss ossen a bad stock? that's later on the closing battle.
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board. the first civilian plane crash to result in deaths after an impact with a eagle. >> more than 80,000 residents of the town were ordered to evacuate. no injuries have been reported. the european union top court dealing a blow to the tobacco industry requiring plain cigarette packs, bann ened electronic cigarettes and more stuff. that is the cnbc news update at this hour. back to you kelly.
>> why does a billionaire candidate connect with voters fed up with the economy? >> you are going to go on stage after we speak is that right? >> and i'm going talk about trust. and what creates trust and what's destroys trust. >> why do you think that is such an important topic to this audience? >> generally, if you think about how much of a -- trust in society it is kind of amazing. we actually don't appreciate it enough but i was recently in peru and i went to buy a pen. not a big deal. but you go to buy a pen and you meet somebody behind the counter and you say i want this pen and they give you a slip of paper. and you take that slip of paper and go to someone else and pay for the pen and take that to a third person who gives another paper, and the third -- >> all in the same shop.
>> because they don't trust anybody. they don't want anybody to have the pen and the catch is at the same moment. >> and as an economy, experience for a long time, trust has a lot of opportunities to get much worse and actually hurt the economy a great way. >> and we should get into that but i'm more interested why do hedge funds underperform? audience is dealing with a difficult environment in which stock picking still works over a long period of time but stock prices have been whip sawing everybody around. and some of the big companies like sun edison that were big bets, some of the speakers inside have, you know, filed for bankruptcy. and investors are wondering if it is worth the money anymore. somebody has suggested hedge funds are over or dead or something to that extent. what do you think are the psychological factors that account for the persistence of
paying these fees and this whole profession. >> so i had dinner with a big hedge fund a few years ago. and the guy next to me was the manager of this hedge fund. i asked if he's willing for me to ask his customers straightforward questions. he said. go i said this hedge fund is charging you two in twenty. i said what would you differently if it was one in twenty? or three in ten? and most of them, or, you know, half in ten. what happened? and most of them said they don't think that they would have given him anymore money. and we've kind of had this discussion about why don't they pay attention to management fees? and they just don't. you have these two variables. expected returns and management fee and people pay lots of attention to one and very little to another. so it is hard to say if it is worth it or not because it is a complex question that is beyond -- >> and they are all different.
>> they are all different and it is also beyond the simple returns. even think about individual investing. say i'm your financial advisor and you come to me i and do a lot survey of your risk attitude and trying to figure what to do with you. and we decide you shouldn't take much risk and i invest for you in that way. but then when i show you return, i don't show you risk adjusted returns. >> right. >> and everybody in the financial industry is doing the same thing. we're measuring something about your desire. and people go in a particular hedge fund for a particular purpose. like it is an instrument. you want this risk. you want to do something that is uncorporate e uncorrelated and so on. but then when we report it we report it not in terms of what we -- >> we have to let you go and get ready for your own presentation, dan. thank you so much for joining us. and good luck with the kraud in there. dan ariely head together stage here at sohn. up next.
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weight watchers surging after hours. >> weight watchers reporting earnings loss of 17 cents adjusted. which did peat expectations. revenue a slight miss. but the metrics compelling and the period subscribers were up about 5% versus the prior year period. ceo says it is leveraging the success of the identity beyond the scale" program which investor oprah winfrey helped launch. lastly, weight watchers is raising its 2016 earnings guidance. the stock up better than 14% after hours. but let's just put this into perspective bill. this is a stock that is down about 30% year old to date. >> thank you. but yes, your chicago neighbor oprah is making money in the after hours here though.
>> she is making some money back. >> she bought in single digit. from 6 to 18 and then up to 26 and bleeding lower since. >> she'll be okay. >> yeah. and the guidance is very strong. even though neither the revenue number or the earnings or loss are compelling. >> what is the compelling reason to buy in this a highly competitive category right now? >> i can't find you one for you. i wouldn't be chasing here. >> other than the oprah factor. >> and she is a great -- >> -- salesperson yes. >> and a industry constantly going through shake outs and one regimen and diet taking the place of the another. that she can stand outs s as th face of this brand and keep it in the center. and donald trump now likely the nominee for republican for
. . . welcome back. cbs chairman and ceo joins "squawk on the street" earlier today. he spoke about the big pay day he sees coming for broadcast television thanks to political ad spending in general, and likely gop nominee donald trump specifically. >> he hasn't spent a lot up to now. i think in the general election he will spend a lot more. he will have to.
in addition, with donald trump leading the ticket, there will be a lot more attention on local races. so we think in the senatorial around congre and congressional races there will be a lot more spend. we think this will be the largest spend in a presidential election news cycle. >> so it was interesting, mike, in his speech last night, trump was talking about how much these negative ads against him were in indiana, how he saw five in a row, tens and tens of millions of dollars were spent. is that the implication here? trump hasn't put a lot of money into this race. >> he hasn't. in fact, he's sort of bragging about the fact that he doesn't even need to match anybody else dollar for dollar on this. that is the question. i don't have any surprise that les is going to talk how it's going to be a record spend when he owns the network and all those tv stations. i do think it's interesting to ask the question, whose money is donald trump going to spend. he probably out of pocket does
not have a billion dollars liquid for a campaign. >> do you like this company? >> cbs? >> yes. >> of course. i think moondez is absolutely right. folks are going to spend like crazy. all these senate races, and there's a lot of close ones, there's going to have to be a lot of money spent just to get in front of the voters, because of trump and hillary sucking all the oxygen out of the room. >> and then kelly, of course, viacom as well. they've got to figure all that out, right? >> i'm just thinking to myself, too, if i'm the rnc, am i going to spend a boatload of money when it doesn't seem to have moved the needle. there's so much at stake. up next, what you're saying, bill -- >> okay. i'll do this. stay right there. when we come back, we'll count down to the conference call of the big earnings reports that we've been hearing about. kelly and i are back just after this.
i'm looking for my notes on all the earnings that came out here. let's check how they're trading right now. tesla up 5.25% right now on really impressive guidance. we'll hear more from them on the conference call coming up in about 35 minutes. fitbit down 11% right now on some disappointing guidance. even though they hit their numbers. whole numbers is up after sharply higher after their report came out. john, what are you looking for? fitbit especially here. >> i don't know if fitbit, like i said earlier, i don't think they can say anything that will really get people excited, because of the sale numbers in
particular. especially the numbers on the fitbits themselves. the new products could be very exciting, but it will be a big spend to get them there. >> all three of these stocks are actually real battleground stocks. heavy short positions. management has been trying to regain the legitimacy, or keep it as the case may be. whole foods is very interesting here. it has a lot of these moves on earnings. people think maybe you can take the bottom. people for a while were talking about the lbo, all the other things. the conference call there might gain some clarity about what the outlook for the next couple of quarters is. >> kelly, you spent the day at the zone conference. your head spinning with all the ideas coming out? >> i love it. what a difference 15 minutes can make when you're drilling down. i thought larry robbins gave a great presentation, that it's hard. reiterating the six companies he still likes longer term. i think the theme was funny,
trying to reassure everybody that you kind of have these ups and downs, but on the other hand, you have stan out there talking about much larger concerns about sort of a fragile environment. i'll try to write out the individual names, too. go go, that was interesting. we'll watch the amazon. a lot of great stuff. >> i see a spark coming. i sense it. i don't know. anyway, great job. >> sparks are flying. >> look forward to having you back with us here on the big board tomorrow. my thanks to john and to mike as well. that does it for "closing bell." "fast money" begins after this break. see you tomorrow. understands the life behind it. for those who've served and the families that have supported them, we offer our best service in return. usaa. we know what it means to serve. get an insurance quote and see why 92% of our members
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check your broker with brokercheck. breaking news at this hour. you're looking at a live shot of columbus, ohio, where john kasich will deliver a statement where he's expected to announce he's suspending his campaign for president. that announcement all but ensures that donald trump will indeed be the gop candidate for president. the possibility of a trump presidency becoming more and more of a reality to investors here. what does this mean for stocks. seems like this week, though, we've had a little bit more of a defensive tilt in the markets. >> no question. look, urn