tv Closing Bell CNBC August 12, 2016 3:00pm-5:01pm EDT
join you and eat this one but it's 24 years old. >> i liked it and asked the burger king folks if the king has a corner office or a throne. they didn't have an answer. >> she ran away. shelley ran away. i scared her. >> if i was in college, i would want to get back, too. >> we have to go. thank you for watching. thank you, kayla, for being with us. >> "closing bell" starts now. welcome to the "closing bell." i'm sara eisen in for kelly e rans at the new york stock exchange. >> it's friday. >> it is friday. >> tgif. >> matching like prom dates again. >> i forgot the boot near or whatever i give you. stocks pulling back a bit today after the record breaking close for all three of the major averages. last time all three closed at a record high on the same day 1999. stocks sold off significantly in
the first quarter of the next year but this time may be different and we'll talk about why coming up here. >> plus retail reality check. jcpenney, the latest department store stock for a pop this earnings season and the government retail numbers less than expected. we'll dig deeper into what is going on with the u.s. consumer right now. >> so herky jerky. first, there were major problems for delta as we know this week with thousands of flights canceled. now, another airline experiencing turbulence. literally this time. 24 passengers needed medical treatment because of it. we have details and the fallout for the airline industry coming up. >> that is a nightmare story. hillary clinton releasing her 2015 tax returns today. trying to pressure donald trump to release his tax documents, but will it make a difference? that's coming up, as well. >> a lot to get to. let's start with the market moves today. stocks pulling back just a bit of yesterday's record close.
bob pisani behind us looking at the financials which missed out on the record rally. bertha coombs with the tech sector and seema mody looks at the last time way back at the end of the 20th century. bob, let's start with you. >> important thing here, bill, s&p 500 historic highs and the banks can't get momentum going. look at this week what's going on. all the regional banks, the s&p up factionally for the week and doing nothing. huntington beach banks for example, fifth/third. all down about 3% so far this week. if you look at the bank index, there's the kbe, starting promisingly. the bank stocks started positive. but you had a flat yield curve, modest loan growth. look what happened to the banks overall. no yield curve movement there.
modest loan growth and better opportunities in other sectors. that's what was going on with the banks overall. so focus on right now. the sectors that matter right now, tech and energy are the leadership groups, utilities, telecom, consumer staples, the laggards and banks not doing anything. not lagging but not showing any leadership at all. and this is a problem for a long time, guys. look what the long-term bank index versus s&p 500, that's the white line, the bank stocks as a group still half the value that they had ten years ago. that is relative underperformance. guys, back to you. >> that is some chart, bob. thank you. the tech sector, meanwhile, has really taken off lately helping lead the rally. bertha coombs at the nasdaq looking at that angle. >> sara, investors like to see different classes of stocks confirming record moves and taken the qqqs, those are the biggest cap stocks here at the nasdaq, and extra year to catch
up with the come positive it. most recent move is led by big cap tech like apple. providing some of the biggest point impact, gaining 13% just since the start of this quarter. brexit? what brexit? chips helped power this rally. they're up about 12.5% quarter to date. led by invidia today at an all-time high following blowout earnings driven by chips for gaming. it's up about 5.5%. but unlike last year when the composite moving to new highs, facebook, amazon, google, they're providing a heavy lift but it's a much broader rally in tech. some of the big rotation that we're seeing into the names has gone into old-line tech names of microsoft and intel. which have seen nice gains. but they also paid dividends. and that's something that we didn't see the last time around at these levels with tech
stocks. it is a much different rally and a much different valuation. especially when you add in those dividends, bill. >> thank you. in fact, the last time the dow, s&p and nasdaq closed at new highs on the same day december of 1999. shortly before the dotcom bust. seema mody looks at whether history repeats itself. >> it is not a common occurrence to see the dow, s&p and nasdaq hit all-time highs at the same time and investors are trying to analyze what this market trifecta means for the direction of stocks going forward. according to data, since 1986, this market trifecta happened 132 times. and usually it's a mixed signal for the market with the naz democracy and the dow typically moving higher and the s&p 500 moves lower. the last time, of course, this happened was 1999. and one month after this milestone was hit, the s&p 500
fell 5%. that's leading many to compare and contrast 1999 to 2016. one factor to consider is valuations. check out the price to earnings ratio of the s&p 500. trading at 29 times in present day. but back in 1999, excuse me, 29 times earnings in 1999. fast forward to 2016 at 18.6 times. nasdaq 100 trading at a chopping 72 times back in 1999. here in present day at 21 times. yes, the s&p and nasdaq trading higher than historical averages but nowhere near what we saw in 1999. that's why this valuation experiment, of course, or the part of the story is something very important to consider as we compare and contrast. back to you. >> that's exactly what jeremy siegel told us on the program yesterday. nowhere near and why he thinks there's room to go higher. >> interest rates back then around 5% to 6%. 2016, the low rate environment
for another catalyst why investors allocating money into the stock market. >> thank you very much. let's kick it around a little bit. the "closing bell" exchange today, sean o'hara, keith bliss at post nine and scott nations joins us today from chicago. keith, we established that the market is trading like it's 1999. is there any reason to believe it won't just keep creeping ever higher and higher? what could stop this run here do you think? >> well, you are right, bill. the term that's gotten into the collective lexicon down here on the floor and also on wall street that's crept back in is called a melt-up. i don't necessarily agree with that. that's generally sharp moves higher and money redeployed and a grind higher. to the point and question, i think it will grind higher. sure, there's compare and contrast of 1999 to august 11,
2016. the markets are totally different and what got us to that point in '99 and early 2000 is people were just pouring money blindly in to companies that weren't making any munl at this point in time. didn't have a product. i was working in a large nasdaq market maker at that time and companies public that didn't have a product yet. >> i remember. >> that's a crazy time and the market dynamics and fundamentals, technicals inside of each of the charts are very different at this point in time. we have the markets neutral, and the way that they're positioned particularly the s&p 500 and the nasdaq composite i do believe that this market can continue to grind higher here. >> still, sean, one of the features back then was that the stock market didn't necessarily reflect the fundamentals and there are questions right now about whether stock market valuations reflect the real economy, matches up with reality. what do you say to that? >> well, you know, just to finish the last point, you know, in the 1999, a big sector of the
market was trading at a huge multiple and drove it up to 29 times so what you're seeing right now is a real disconnect of reality looking at earnings and earnings growth and gdp. there's a huge separation of what would be traditional valuations. so it's a little bit disconcerting. the market is working on like an inverse news cycle. the worse the news is, the more the stock market goes up and people continue to believe there's global central bank intervention and quantitative easing and continues to drive stocks higher and higher. there's a particular sector today or a kind of tock that really concerns us because its valuations are stretched versus the market and traditional dividend paying stocks and if you look at funds or etfs trading 22 to 25 times. >> that's a crowded trade, yeah. >> but you own p&g, don't you?
>> so that's a great leeway to talk about what we do. we have a global dividend strategy. if i'm an investor looking for dividends today, i include u.s. stocks and look around the world to buy a basket of high-quality names with dividends and don't trade at the big valuations. we trade at 15 times earnings and 4.2% dividend. i would rather buy at a discount to market and higher dividend flow and if things didn't continue to grind up as the previous guest said. >> nothing gets passed sara. we talked about how interest rates are lower than they were in 1999. do you think the stock market would be as high as it is today if rates weren't as low as they were today? >> oh, certainly not. i mean, we look at the 10-year yield around 1.5% and makes it easy to run out and buy the
dividend paying stocks that sean doesn't like that much. look at the pe for the 10-year treasury. 1.5%. the pe is huge. well, you say that you're not the biggest fan of some of these names, i actually think compared it to the 10-year at 2.2% or 2.3%, the yield on the s&p is actually in really good shape. i think if there's anything confounding today it's the performance of the retailers given that retail sales were horrible this morning in the entire sector doing really well today led by nordstrom. but we have the entire retail sector in the form of the etf higher, walmart higher, amazon higher. so i think that's why it's confounding. it is august. we're supposed to be confounded right now. >> to that point, keith, it does feel like whatever your opinion of whether the bull market continues and the records made, the defining moment is low interest rate environment and we have seen stubbornly persist.
>> yeah. let's take a step back from what we think real valuations or good valuations should be and look at the fundamentals and realities of the world. you have pension funds globally struggling to meet the future liabilities and they have to get some yield out of their investments so bertha mentioning before we came on where the run-ups have come in traditional tech stock stocks of microsoft and intel. pension funds run into them to rally and they have a good dividend yield and they need to get yield in that. it's really no more complicated than that in this current market here in august. investors are chasing yield globally and right now the best place to get that is u.s. equity market. >> a simple market, complex investors. >> yeah. absolutely. and there's no alternative. how many times have we heard that? >> thank you, t.i.n.a. we are heading into the last hour of trade with the last hour. the dow down 49 points. pulling back from the
yesterday's all-time high and the s&p down 3.5. >> nasdaq goes positive. that disappointing retail sales number has raised some new flags about the economy. up next, we'll tell you which part of the retail industry are working. and whether investors should be worried about the consumer here. plus, with index funds continuing to outperform actively managed funds, is the age of the stock picker officially over? we'll talk about that still to come on the "closing bell." can an established bank move like a start-up? it's a question we get from some of our largest banking clients.
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positive. energy and staples are outperforming in the s&p. but the best performing stock right now is nordstrom. this after the company's earnings beat wall street estimates. thanks to a smaller than expected decline in same-store sales continuing a pattern, bill. >> yeah. yesterday we talked about the possible resurgence of retail. is that story line holding today? courtney reagan wraps it up and steve liesman with the new data of this morning. let's start with courtney. >> jcpenney is getting there and still a long way to go. the retailer posting a loss and both smaller than expected and a fraction of last year's loss. sales a little light and comparable sales still positive. remember, it's rebuilding back those big plunges we saw under the former ceo's failed transformation and then the reversal and reiterating
full-year guidance. they like the strength driven by regular priced selling at jcpenney. margins, though, only improving 10 basis points. updates to the center core where the accessories are sold and home of the appliance rollout strong points and each expected to further take hold in the second half of the year. if i play teacher and give a report card for a minute, yc penny, ralph lauren, macy's, kohl's, nordstrom, rewarded. coach did beat on profit and shares are down for the week. kors and wayfair, in the back of the class for the week. sara, back to you. >> hang on. we'll talk more in a minute but we want the latest data on retail sales this morning. not painting a rosie picture of the consumer, steve liesman has the details and the context here. steve? >> yeah. so after spending at a solid clip in june, consumers just
kind of gave the credit cards a rest in july. the government's retail sales report shows spending flat last month after the upwardly revised gain in june and the concern of economists is whether this was just a pause or if consumers have been single handedly holding up the economy if they might be ending their spending ways. a lot of month to month volatility here in the data and spending stays flat in august, well, the's concerns the economy might not be growing or at all or a potential recession on the edge here. sales declined in sporting goods, department stores and grocery stores. gasoline stations fell as sharp as 2.7%. that was mostly the result of price declines. some economists wondered if part came from overall lower prices in some industries. auto sales did surge 1.1% and online retailers saw sales increases. maybe that's an effect of amazon's prime day and internet sales shot up. whatever the reason, doubts about the consumer, that's
another reason for the fed to go cautious on rates. courtney, sara? >> thanks, steve. >> or anybody. >> all of us. >> take it! >> is it as simple as, courtney, online retailers picking up more and more market share? >> that is certainly part of it. remember, you have macy's operating stores and a website. and macy's is the third largest retailer in the categories in which it sells. so there is some shift to the online channel. remember, also, though for department stores, expectations were really low. first quarter was really, really crummy and been pretty bad since last august. and so, to just beat those low expectations that's how you got the stock pops. we are looking year over year, the retail sales data looking month to month, as well. >> steve, i was just wontd wond how you're making sense of today's report and last gdp number, a bright spot is 4.2% rise in consumer spending.
>> without the consumer we would have nothing, sara. take a look at the fundamentals of consumers, two jobs reports north of 200,000. we have had better paychecks out there. we have relatively quiet inflation. the fundamentals are there for the consumer to spend and i think, you know, courtney may have something to say about this but the idea of terry lundgren and spending but not at macy's or where it's captured. maybe buying more services. taking more trips. doing things that aren't necessarily captured in the standard or traditional retail sales places. >> yeah. i think that is really true. what terry had said is that's the pattern for sometime. consumers buying cars and making home improvements but how many cars do you need is what he said. how much can you improve the house in a short period of time? maybe it is his turn, a turn for retailers to get some more of that now. >> ask bill griffeth how many golf clubs he needs. >> that's the thing. is this a demographic play?
are the boomers, we were the shop until you drop generation. maybe we have shopped ourselves out and the millennials -- i'm just speaking from experience, they're not exactly big shoppers themselves. are we seeing that kind of a play, play out here, do you think? >> i think it's important questions that retailers are trying to figure out. structural or cyclical? what's the reason for the good this quarter and what was the reason for the bad last quarter? is this a new positive trend or is this just because it was really, really hot in lots of parts of the country and needed new shorts? we laugh about weather that can really make a difference. >> i know. i was going to say, okay, who had weather mentioned at 3:22? we finally got around to the weather. eventually they do. thanks, guys. appreciate it. have a good vacation, bud. >> thanks. all right. less than 40 minutes to go here before the closing bell. and let's show you where we are on stocks. selling off to the tune of about 54 points on the dow.
s&p down less than .2% here. so we are pulling back from the record highs. we'll see if the nasdaq can stay positive for the session and for the week because it would be seven in a row if it does close higher for the week. >> many people on twitter commenting on how i'm wearing a tie to match her dress today. isn't it possible, though, that she put that dress on to match my tie? >> no. because i got dressed at 3:30 this morning. >> okay. >> when did you get dressed? >> we move on. a rough week for delta. not going any smoother. after a flight had to turn around because its door may have been open on a delta jet and not the only carrier with turbulence this week. that story next. later, hillary clinton just releasing her tax returns for last year. but is there any chance donald trump will now follow her lead? that discussion is coming up. guys, what's happening here? hey nicole, this is my new alert system for whenever anything happens in the market.
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mixed day for the markets with the dow down 51 points to close out the week here. s&p down 3 and the nasdaq hanging on to a gain. remember any positive close would be a new all-time high. >> doesn't look like the tri feck that. we'll see. still the most important half hour of the trading sessions coming up. >> what she said. blackberry shares getting a boost today after raymond james upgraded the stock from market perform and raised the price
target. but so it implies a more than 20% gain of current levels. the firm said that it is bullish on blackberry software business. mysteriously it didn't mention hand sets. >> and bill griffeth is still proud owner of. >> always will be. a turbulent week for delta. first that system outage causing over 2,000 flights canceled and then last night a flight forced to turn around after the crew realized that the architect's door might have been open. it was a false alarm. delta is not the only carrier feeling the heat. jetblue, rough skies sent 24 people to the hospital. on that boston to sacramento flight last night. social media has been pounding the airlines forcing some to wonder if social media is part of the problem or part of the cure in the uneasy relationship between airlines and its passengers these days. we welcome aviation expert kyle bailey to offer some insight.
i mean, is it just that we're paying more attention because of social media or happening more often now? >> this stuff is always happening. social media blows it out of proportion. an airline ceo, twitter, social media is a nightmare and bring down the reputation of an airline within 24 hours. >> specifically to the turbulence issue here on yetblue. what about the technology issue? that one at delta, granted it's happened to a number of other airlines and southwest in july, but seems to be occurring regularly. and getting a little more disruptive. >> well, right now, with all the airline merge earls of the last several years, integration of systems is very complex. and a lot of these systems are from the late '90s technology and to bring it up to speed is extremely expensive and the airlines aren't willing to -- >> delta said it's gone to $150 million this year.
>> the systems are multi-layered. many systems feeding into a single system and the systems feeding in could be decades old. >> are you saying airlines become too big and complicated? >> you know, that is true in a sense. it's just, they're so big, like it used to be, small er airline out there, dealing with month of july delta with 21 million passengers so you really need automation. it has to be there. >> but you have, but when you consider when something goes down in atlanta and it affects the whole global footprint that that airline has, you got a problem. >> that is a big problem. and they will learn from this mistake. and like the financial industry, after 9/11, there's always the need to have, you know, backups, full redundancy at a different location. i'm sure that will be done with delta airlines as a result of this. >> i'm trying to figure out whether it's a worry for
investors in the airline stocks. clearly this is costly what happened and it comes at a time of concerns of terrorism and zika and overcapacity and not enough revenue per seat mile. i'm wondering your feel about the overall industry right now. >> no. this is no affect on that. this is an operational issue and it's not really -- it's significant but you have to remember these airlines have been operating for half a century and how often does it happen? we think it happens a lot but there's a couple bad instances and getting a bad rap for it. >> they're 30,000 flights a day. >> exactly. we only hear about one or two. >> exactly. >> when that happens. >> yes. again, it is blown out of proportion with social media and twitter. >> only bothers people who don't like to fly. >> that's right. thankfully this is not a safety issue. >> one of us. >> well, i just get nervous about the turbulence and 24 people having to go to the hospital, scrapes and bruises on
turbulence sounds extreme. >> that's extreme. seat belt should be fastened and clear air turbulence and you can't predict and in the vicinity of thunderstorm, you can be turbulence 30 or 40 miles from a thunderstorm. >> thank you for joining us. >> thank you. >> appreciate it. aviation expert kyle bailey here at post 9. time for a news update with sue. >> hi, bill, sara. a big development in the fight against isis. u.s. defense officials confirming the leader of the islamic state in afghanistan and pakistan has been killed. in a u.s. drone strike in eastern afghanistan. that strike occurred on july 26th. heavy rains in gulfport, mississippi, since wednesday causing flooding in some areas. a river overflowing the banks and on to the road. more thunderstorms are expected through the weekend. a north carolina man convicted of murder 28 years ago when he was 15 has been released
from prison. there were plenty of hugs to gornd as johnny small left the courthouse. a judge ruled he did not get a fair trial. and a cuban cigar roller beat his own record for the longest hand rolled cigar coming in at a whopping 295 feet. jose made the cigar over a two-week period helped by dozens of local workers and he said it was in honor of fidel castro's birthday which is tomorrow if you didn't know. that's the news update this hour. what you do with that 290-foot cigar, i don't know. >> who's going to smoke that? >> maybe give it to fidel for his birthday. >> cut it up like a cut? >> i don't know. >> i don't know. >> thank you, sue. something to ponder heading toward the weekend here. roughly 30 minutes left in the trading session here. the dow down 46 points. up next, a leading trader here on the floor of the new york stock exchange will tell us whether he's seeing any cracks in the foundation of this
market's record rally. plus, sky high housing prices forcing some people to flee some cities. coming up, we'll talk about whether this is isolated in a few aerl yeahs around the country or if housing is just flat-out unaffordable for too many americans. coming up. mm-hmm. drowned it again... mm-hmm. and now just feel if it's cold. yeah. cool. [camera shutter clicks] [whistling a tune] smokey just gave me a bear hug. i know. i already posted it.
the dow off the lows. it is still lower, though. down 39 at this hour. the s&p 500 down about a tenth, two points. nasdaq stays positive. we'll see. just about the flat line for the week on stocks. dow may be down today but exxon and chevron are bright spots thanks to another big gain in oil prices. has also been a theme this week, bill. >> all right. 24 minutes left in the trading session with the dow down. joining me on the floor of the new york stock exchange is alan valdez. this has to be a pretty frustrating market for two groups to think of, traders looking for volatility and people not in the market waiting for a pullback to get in the market as it just creeps ever higher. >> every day we see the same thing. look. today off, of course, small.
>> you get to the new high and what's going on? >> next week, a lot of -- if you're short, you have a short position in the stock, you'd rather cover your position than pay out the dividend and might see a bump on technicals. you know? it's very quiet. today, i drove in. nobody on the roads. i knew it would be a quiet day. sure enough, not for the retail sales, really flat lining it. i think this's the way to go. we'll see what happens in jackson hole coming up but they won't raise i don't think until next year. tame inflation. no reason to. >> so you're not expecting much? >> no, not at all. you know, it is a friday. let's see next week but i think next week is just as quiet. oil really didn't move the market much. we heard that story so much about a freeze. just played itself out. >> but there's always the possibility of a black swan. we'll see if we wait for that. thanks. have a good weekend. sara? hillary clinton releasing
her tax returns today. but will that force donald trump to do the same? john harwood is breaking down her taxes and the answer hopefully to that question. what are the odds he releases his, john? >> low, sara. we'll see. look. hillary clinton got more good news in the polls today. our nbc poll showed her leading in four additional swing states and trying to keep the pressure on with this release. oddly enough, of her tax returns. now, take a look at the top line numbers. she and bill clinton made $12.5 million in 2015. a lot of money. they paid effective tax rate of 34.2%. they gave 9.8% to charity. almost all of that in a $1 million donation to their family foundation. and here's how you break down some of the sources of income. bill clinton made over $5 million in speaking fees. $1.6 million in consulting. hillary clinton made $3 million
as an author. another $1.4 million in paid speeches before she stopped delivering them as a candidate and ten years of returns for tim kaine, 2015 numbers show that he's one of the poorer members of the senate as that group goes. he made about $313,000 between he and his wife in 2015. paid 20.3% effective federal tax rate and over the 10-year period, the campaign estimates he's paid an average of 7.5% of his income to charity. now, why is that relevant to donald trump? here's what we know about donald trump. he says he has a net worth of more than $10 billion. we know from past filings to government agencies and court proceedings that he didn't have any income tax liability in 1978, 1979, and 1984. the idea of hillary clinton's release today is to put pressure on donald trump to release his
own. to try to answer questions, does he make that money? does he actually pay federal income taxes now as he hasn't in some years past? how much does he give to charity? he gave a speech in pennsylvania. he didn't address the issue and my guess to the question of earlier is he is not going to address it. he says he can't release his returns under audit. past years no longer under audit because he says they're all linked together. plainly donald trump likes the style in which he's been campaigning. he's going to keep doing it. >> and it occurs to me, no great insight, he won't be able to use any of hillary clinton's as political fodder because then it can blow back on him at the same time. right? >> i don't see any possible way that he could do that. you know, if you're holding yours back to attack hillary clinton's income, i mean, look. bernie sanders attacked it plenty, the amount of money made in speeches and what did she say
in the speeches and that sort of thing, but that's not a promising avenue for donald trump because she'll just come right back and say, let me see your tax returns. >> very quickly. this is not a new question, john. it's come up repeatedly in the campaign with donald trump not releasing the taxes. but can you just explain why this matters, why americans should care about the tax returns of clinton and trump? >> well, the -- there's a tradition in the country going back several decades that as a way of trying to assure the american people that a candidate for president is not self dealing, is not involved in unsavory activities, they put the information forward to try to allow people to judge the background and character. and by putting them out, you're saying you can take a look at my entire life and draw your own conclusions. you know? mitt romney resisted releasing his for a while in the 2012 campaign.
he eventually did so. took some criticism for it. you know, kanld dacandidates ge criticized if they have a lot of money and trying to be as transparent as they need to be politically to the american people. >> yeah. because a lot of trump supporters say, it's his business. we don't need to know. thank you. >> thank you. >> see what happens next. john harwood. less than 20 minutes to go before the closing bell, where we are in the major averages. the dow coming back a bit down 33 points. s&p 500 down a point and a half. so that is coming off the record close yesterday. the nasdaq, though, still positive by 3 points. best performing stocks this week are a lot of department stores. >> and today, utilities are doing well. >> consumer staples. and energy. actually. the nfl's rams, the rams are making their return to los angeles after more than a 20-year absence. when we come back, we'll look at the financial impact of a nfl team playing in the nation's second largest market once
again. and speaking of returns, one of hollywood's most iconic characters is set to return to the big screen for the first time in years. details of the new "star wars" trailer later on "closing bell." where we explore. protecting biodiversity. everywhere we work. defeating malaria. improving energy efficiency. developing more clean burning natural gas. my job? my job at exxonmobil? turning algae into biofuels. reducing energy poverty in the developing world. making cars go further with less. fueling the global economy. and you thought we just made the gas. ♪ energy lives here.
shares of twenty first century fox off the highs of the day after an announcement of new structure. shine and aber that think as co-presidents of fox news reporting to founder rupert murdoch and comes after former fox news ceo roger ailes resigned last month amid sexual harassment allegations. the nfl returning to los angeles and ironically the rams returning home after a more than 20-year stay in st. louis. jane wells is outside the good old l.a. coliseum for more on what it means for the nfl and nation's second largest market. jane? >> reporter: yeah. actually, snuck inside. i'm down here on the field putting the finishing touches and not allowed to wear high heels down here. they left over 20 years and left the coliseum in 1929. first time sees rams here since
then and a buy here in a long time. bill, i'm sure you remember the days of roman gabriel and fearsome foursome. the rams returned. will the fans? well, so far so good. big fan turnout of practice fans. tomorrow's preseason game sold out. in fact, the rams have jumped from 23rd place to sechbtd in terms of the resale value of the tickets. averaging now $235 a piece. only thing missing, a winning season. which the team hasn't had in 13 years. what kind of pressure is it on you to deliver a product that will sell? >> well, you know, this pressure on me every single day. but never in my career i looked over my shoulder. >> reporter: coach fisher says he hopes fans go home tomorrow with horse voices and really
hoping they hang around because in three years the rams move into the incredible 2.6 billion privately funded stadium, state of the art over by the fabulous forum. bill? >> why wouldn't there be fan interest? they have been gone for 20 years. there's been a movement by some very well heeled people to get a team back there again. isn't there -- i mean, a huge media market. blah blah blah, right? >> reporter: right. well, there's fan interest and you know how l.a. is about losers. they like winners. i'm curious of the impact of rams games here on sunday does to usc games here on saturday. you see raider nation games and rams and chargers fans and been the only game in town. >> i feel bad for st. louis or do they root for this team, as well? >> that's what we had to deal with when they moved to st. louis. do you still root for the rams? >> right. >> reporter: i'm still mad at georgia. still mad at her and she's gone.
>> where are your season tickets for the trojans? point them out. >> reporter: no. for the trojans i get to sit here. my rams seats tomorrow, i don't know if you can pan over. i scored some seats just under the press box. not bad. not complete nosebleed. >> nice. >> there are no bad seats in the coliseum. >> cool l view you have right now in the bare feet. >> thank you, jane. >> best seat right here. >> have a good game. >> you're welcome. >> thank you. big, big, big. big news. okay. we got little over ten minutes left in the trading session. the dow not budging down 35 points. s&p down point and a half. nasdaq might close at an all-time high again. >> just barely. up next, it is friday. david darst has the key things investors need to watch to know if the recent record rally has more room to run. the's probably an acronym coming
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darst joins us this friday. how are you? >> welcome. >> doing well. thank you. congratulations to team usa on all the medals. >> yes, yes. >> 39 or so so far. >> amazing week. >> looking forward to track & field last week. this week, things to be watching would be medals. like olympic medals. monetary stimulating going on right now. all over the world. earnings are brightening. this quarter when it began, people looking for about $112 for the s&p 500 for the year and now up to 115. estimates have been coming up a little bit and you have the third quarter expected to be 3.7% according to the atlanta fed's gdp now. the dollar has been unwavering. >> you did that just for her, didn't you? >> had to be a "d." >> dollar unwavering, bill, sara, a good thing and not a lot of volatility in the markets. as a matter of fact, china
actually allowed the currency to go up by .4 of 1%. asia, okay, asia is steadying. no bad news. although chichina's numbers a th to the weak side. factory -- fixed asset investment. exports, imports and pricing structure there. "l," labor improving. probably the best news of the whole week. job opening and turnover survey. 5.6 million unfilled jobs. 255,000 jobs last friday. average hourly earnings up 2.6%. so the labor market and finally not to be missed, saudi balancing the market. calling for a meeting when they get together inial ye algeria t on the side and that helped oil rally this week. get out of europe. get out of japan. get into emerging markets and get into small and mid cap stocks. that's the feeling of the global
investment -- >> usa like the medals. there you go. >> get back into medals. go team usa. >> apparently the stocks. >> thank you, david. >> thank you. >> got to go. >> thank you. >> have a good weekend. we have breaking news involving zika. sue herera, when's going on? >> florida department of health is now saying, bill, and sara, there are three new non-travel related cases of miami-dade county. that brings the total to 28. those three new non-travel related cases, two of the individuals were exposed in the less than one-square mile of miami-dade. the third new non-travel related incident is located outside of the one-square mile of miami-dade county. the wynwood section and the department still believes that they contracted the zika virus in that one-square mile so that's significant because there was some worries that perhaps that area was expanding.
it is not at that point. however, there are three new non-travel related cases of zika bringing the total in miami-dade county to 28. guys, back to you. >> all right, sue. >> a daily occurrence. >> we get a daily update around 1:00. thank you, sue. we'll come back and wrap things up for the last hour of trade with the closing countdown in a moment. back after this.
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for the week as bob pisani. >> bob pajama joins me. here i am. >> nasdaq finishing it looks like with an all-time high and seventh week in a row the nasdaq with a positive week and amanda diaz at our news desk dug up a statistic that shows that this is the longest weekly win streak for the nasdaq going back to 2012. well done, amanda. >> good investigate reporting. >> right? >> look at the correlation. >> when all is said and done, a flat week overall. right? >> exactly. i think we started 2184 on the week or 2183. but the important thing is the leadership that's still very much intact, the tech names. invidia with another new high and the big names here. amazon, google at new highs, industrials hit new highs so the rally is very much intact even if we didn't move much on the numbers. >> all right, bob.
thank you. have a good weekend. we are going out flat essentially for today and for the week. ringing the closing bell at the new york stock exchange, nonprofit group of girls on the run at the naz gak it's athletes for charity. stay tuned now for the second hour of the "closing bell." welcome to the "closing bell." i'm sara eisen in today for kelly evans. bill griffeth will rejoin us in a moment. here's how we finish the day and the week on wall street. we pulled back from the record closes on the dow and s&p 500. just barely. modest declines. the dow lower by 38. s&p 500 lower by two 2 points, way less than a percent. the nasdaq, though, check it out, closing positive up 4.5 points a. new record high for the tech heavy nasdaq. with markets reaching new highs
and actively managed funds underperforming, are investors better off picking broader funds than etfs? we'll debate that, whether it's the end of the stock picker's market coming up this hour. but joining us for the hour, to talk markets and more, contributor evan newmark. chris johnson. fast money trader steve grasso will be rejoining us in just a moment. the always skeptical evan newmark, what do you make of this? >> are you always skeptical? >> always. >> always. >> a good way to be generally. >> skeptical of the rally? >> yeah. i mean, not -- i don't think there's impending doom here. i just think both the bond markets, equity markets especially in the u.s. fully priced. i don't see any great bargains sitting out there which is okay. i mean, it doesn't -- i'm not, you know, i still have about 35% of the money in cash. i don't feel any great need to put it to work right now. and so, i'll just let it sit
out, you know, until something happens one way or the other. >> chris johnson, is it a specious argument to say you invest because where else do you make money these days? >> you know, to some degree, bill, yes. i mean, you have a lot of people looking at yields on bonds and the 10-year and saying, what will i get paid for it? >> right. >> looking at the companies out there, even the s&p 500 with 2.5%, more attractive yields in stocks and why you are seeing people trickle into the market still. >> you know, it is interesting, steve, to see the nasdaq close at a new high. seventh week in a row despite what's been sort of mixed economic data. yes, the jobs number was good but today's retail sales, productivity number earlier in the week, even the wholesale inflation number all coming in kind of disappointing. >> i also think m and a -- >> the other gentleman? >> you. yeah, yeah, yeah.
>> the activity really got the catalyst for the market to add to that lag from brexit. we had the markets rallying. markets factoring in, maybe it was yellen unknown, brexit unknown. we popped significantly and then you had m&a keeping the shorts on the heels and i would ato evan's point, why would you buy it here? i'm in agreement with him. if you held out, i'm in a substantial cast position, it is very hard to buy the market at this toppy level right now. so i've been in stocks like invidia, jcpenney, like underarmour and made money and the bulk on the sidelines. >> let's ask both of you this. what brings the market down? what's the catalyst to start the selling then do you think? what's the biggest fear? >> next shoe to drop, the next issue is what happens with the bond market in the autumn. and you have kind of two scenarios.
one scenario is, you know what? the fed economic growth globally turns out to be better than expected. rates slowly move higher. that brings financials up with it. i think you cannot see a rally until you get a yield curve that looks better for the financials and the financials pull up. flip side, if it turns out the global economy in the doldrums for years, earnings will be kind of, you know, there won't be growth and that would bring the market lower. >> what is your biggest -- >> china. always my biggest fear. we have been focused so my opinion opically on china and we bought it because we had nothing else to trade on but what they tell us we should be trading on. >> chris, the reason i brought up the disappointing economic data because that's underpinned this rally, this idea that we are in some sort of goldilocks scenario and the data is better and the u.s. outperforming the
world and not good enough for the federal reserve to hike rates and the 10-year stuck right now. and stocks can climb higher in that sort of environment. >> guys, there's something here on the technical side, too, i think everybody needs to realize. right now, you know, august is typically a very seasonally weak month. we have seen volume drop off significantly here. typically, when average daily volume is in the lower quartile for the year on the last year, the market's got a 2-1 chance it's higher the next high and bullied. that's what we're seeing and the market is drifting higher. and it does it on little news. the thing to watch, though, is september. even though august is a bad seasonality month, september's a most volatile month for stocks. we are seeing correlations praek down on the s&p 500 names right now. when that correlation continues to break down and hit the
volatility that we always hit in september, i think that's going to be a little bit of a flush-out moment for the market and a buying opportunity. >> all right. well, there were some rays of sunshine looking for buying opportunities. this time in the retail sector this week and a slew of even more earnings next week. could dark clouds be on the horizon he asked ominously. courtney reagan is back. >> i don't like to bring the rain or anything, bill. >> no. >> but department stores and handbag makers results are in. big box retailers and the biggest box of all waiting in the wings and broad indications of the consumer spending is healthy and doesn't mean all retailers are going to beat expectations. home builders like home depot and lowe's report next week. discounters are midweek and urban outfitters, the parent of victor victoria's secret in the mix, too. also the recent off priced leaders, did they steal some of
the thunder? investors are waiting for walmart to update the guidance following the jet.com acquisition announcement on monday. ceo doug mcmillon said he sees encouragement. department stores surprised to the upside on low expectations. apparel spending is so crummy, a little pickup got a lot of attention and subsequent stock reaction of last hour and if early spending is good for kohl's and denim for macy's, maybe others see similar or maybe not. that's the thing with retail. it is a mixed bag. bill? >> yes. thank you, courtney. >> looking at the gains for the week, nordstrom up double digitless. 18%. macy's up 16%. kohl's up 14%. >> right. >> is it a stronger u.s. consumer or the department stores getting better at managing the problems like inventories and like discounting? >> i think a little bit of both
and the names you read off, names that have been so beaten up. so if you look at a tjx or ross stores, the names benefited from abnormally warm seasonality change of the weather last year. they had the bulk of inventory they're not going to see this year so i think it's going to be sell the winners, buy the losers event ongoing. >> bill brought up in the last hour something i really believe which is you can look at retailers all you want but -- some nice young girls. >> pep rally. >> you can't -- >> what was your thought again? >> it's not a tell for what goes on in the economy anymore. you looked at home building, retailers, this is the consumer doing. i think you look at what amazon's doing, understand what's going on with the consumer a lot more. >> very good. >> by the way, let's just -- let's move on, shall we? we have a news alert on general motors. phil, what is going on?
>> bill, this is news of general mottoers from the tech news site the information which is reporting that lyft, the ride share company which gm owns 9% of, lyft has rebuffed general motors interest in buying all of the ride share company. we have reached out to lyft. again, according to this news site, lyft has rebuffed gm's approach to buy the entire company. guys, it would not be surprising that gm has an interest in buying more of lyft or even the entire company given the fact that ride share companies, they're the hot commodity right now talking with automakers and transportation and the fact that gm has already got a relationship with lyft would make it natural that it might want to do more and buy the entire company and according to lyft, it has no comment regarding this report. back to you. >> yeah. i was going to ask you, phil, we have seen other sort of partnerships between these companies and traditional automakers. this is a story you have been
telling for a few months. >> we'll see more of this. you have vw with the european ride share company and uber and toyota. toyota with an investment relationship with uber. and you're going to see more of this in the future. the ride share companies to a certain extent in the cat bird seat. not a lot of them and the few out there have fairly sizable presence, so they're -- the value's going to continue going up for the guys and if you're lyft you can see why you sit there and say, we'll hold off right now and take that $500 million investment for 9% which is what gm owns and for now we're good. >> very slowly seeing the business model of automakers changing. pretty soon selling solar panels or something. i don't know. we'll see. thank you. see you later. chris johnson, thank you for joining us. steve grasso, you're excused. thank you. you have to stay around. >> i'm staying around. you've heard the economic
plans. now, hear how presidential candidates hillary clinton and donald trump develop those plans. unofficial trump adviser and contributor larry kudlow and official clinton con cigly yair share it is insights. housing prices in san francisco sending residents fleeing. we'll discuss whether san francisco housing is past the point of no return and if your city could be next. you're watching cnbc, first in business worldwide. miles per hour. traveling ov0 to win, every millisecond matters. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes. understood, brake bias back 2 clicks. giving them the agility to have speed & precision. because no one knows & like at&t.
so when it comes to housing in san francisco, and the silicon valley, the question isn't where to live but how much does it cost. it's a situation that's sending some folks in that area packing to other areas. cnbc's adida roy. has the story for us. >> reporter: hi, bill. we have seen this week two examples of high profile people driven out of the area. san francisco federal credit union ceo is taking another job in portland in large part because his rent in san francisco is just too high. he says he's already moved his family four times within the
city after his rent kept getting hiked. >> as we looked at it, the money really goes a long ways in a city such as portland, oregon. we have been very much challenged here in san francisco to look at something that was affordable. >> according to zillow median home price in portland about $379,000. by comparison, the median home price in san jose, california, $830,000. in san francisco, $1.1 million. and in to laal to, it's $2.5 million. earlier this week, an attorney and member of the palo alto planning commission wrote a post on how she's quitting the position and moving because she and her family simply can't afford the $6 ,200 rent of a house they share with another family. another possible solution talked about is increasing the inventory of homes but that's touched off a lot of debate. no simple solution here, guys. >> that's for sure. thank you very much.
let's talk about why it's so hard to find affordable housing in san francisco and plenty of other places. joining us, fred glick with us. how are you? good to see you. >> good, bill. good to see you. >> nice to see you. you taught me that all real estate is local. is this a local story there or something going on in the economy? because we hear anecdotal evidence of first-time ho homebuyers have a hard time. when's your view of all of this? >> okay. the best thing about the housing market for a seller is that they only sell when they feel like it because people actually like living where they're living. so why move? that's one of the biggest problems for the housing market in terms of just in general across the country. here in the silly-con valley, it's supply and demand. we keep adding people like crazy and can't get enough supply and
why people have to share houses, that's why renters know that they have to pay an exorbitant amount of money and probably be a little bit less than a mortgage payment which they can't afford. so it's all kind of looney tunes. again, it is all local. it depends on supply and demand. i talked to a few people around the country today, i found out things like philadelphia is just busy. you put something on the market, there's five or six people right away to buy it in a good area at a good price. yet, my friend in tucson said that they have two to three month's inventory for stuff under $300,000. columbus is very strapped. houston has an overbuilt luxury problem and might be because of the oil prices a little bit. so again, it depends where you go. >> yep. >> l.a. and san francisco are just looney tunes. >> is it a bubble on prices in the bay area? >> it is a plateau right now. we have seen through some info i got from one of -- start-ups
involved in one rent.co that the prices in san francisco rentals have started going down a little bit because there's some inventory coming on so we're seeing things come like around the giants baseball park that's popping up that are rentals and not condo sales so that's helping a little bit. is it just because it's the middle of the summer? maybe. but then again, hunter's point which is right down the road will have a million square feet that google is going to be putting in in a few years. not a new location, an addition allocation. >> fred, it is evan newmark. are all markets really local, or is what we're seeing really just kind of a silicon valley related thing, or is this -- is there a bigger story? i don't think there is. i mean, in new york, just to use a contrast, the high-end rental market in the high-end real estate market is in decline somewhat. so i just see that there's a lot
of job and income growth in san francisco and that's what's causing this. >> exactly. but it gets to a point where people just say, i'm not paying that for this. you know? some studio apartment comes up for $800,000, it's 126 square feet. people are like, no. i'll just rent. >> what happens next then, fred? what happens next then in that area? do prices just start to decline? or what happens here? >> or, do mortgage rates go up and the whole thing pops? >> sara, the mortgage rates don't matter because the way it is you're thrilled to get a mortgage. i still go through a nightmares getting mortgages approval that are ridiculous. and if the rates go up, they take a five-year a.r.m. so that doesn't make a difference. >> the most interesting name in
real estate. haven't seen you with a beard. >> appreciate it. have a good weekend. >> you, too. hillary clinton and donald trump agreeing on economic matters? sounds strange but there is truth to it. up next, cnbc contributors, will they agree on the candidates' plans? that is the question. one step away from being dead. that's what some market watchers believe stock pickers are quickly becoming. are they the walking dead? i wondered where we were going with this. >> good video. >> is that possible? that and many more metaphors and analogies are coming up. hello watson. your analysis of social media and conversations on various trading floors, helps us uncover insights. insights that help investors predict market closes, well before markets close. you know, your analysis has helped us improve our predictive accuracy by over 500%. 550.2, to be precise, but we can always do better.
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we are going to take a break now and have a cnbc news update with sue. sue? >> hi, sara. at this hour, the defense department releasing video of u.s. air strikes against isis in libya. a u.s. fighter jet tracking and then attacking an isis vehicle where the libyan government and rebel forces joined together to push isis out of the city. jerry sandusky took the stand to overturn his conviction on child molestation charges. he said he wanted to testify in his 2012 trial but his attorney told him not to do so. he forcefully denied the charges that sent him to prison for 30 to 60 years. southwest airlines says the cancelation of more than 2,000 flights which began on july 20th cost that airline about $54
million. or about a .5% drop in unit revenue blaming a router failure for the cancelations. and if you're a spider lover, rejoice. oh gosh. 200 rare spiders were born in captivity at the british zoo. it is the first time the tarantulas were bred in captivity. i won't look at the video. i have -- >> keep them inside the museum. >> all you spider lovers, raise your hand. >> yeah right. >> i know. there are those out there. >> who loves spiders? >> don't show the spiders. >> evan newmark is a spider lover. >> what's the problem with the spider? >> thank you, sue. >> have a good weekend. >> you, too. >> now i'm like got the creepy crawlies. >> thank you very much. presidential candidates donald trump and hillary clinton both taking center stage this week to lay out the economic agendas and while both spent
plenty of time bashing each other's plans there are more to agree than you might think. >> we'll eliminate the carried interest deduction, well-known deduction, and other special interest loopholes that have been so good for wall street investors. >> we should also add a new tax on multi-millionaires, crack down on tax gaming by corporations and close the carried interest loophole, something i have advocated for years. >> we'll build the next generation of roads, bridges, railways, tunnels, seaports and airports. that, believe me, folks, is what our country deserves. >> we will put americans to work building and modernizing our roads, our bridges, our tunnels, our railways, our ports, our airports. >> just imagine how many more automobile jobs will be lost if
the tpp is actually approved. it will be catastrophic. that's why i have announced we will withdraw from the deal before that can ever, ever, ever happen. >> my message to every worker in michigan and across america is this. i will stop any trade deal that kills jobs or holds down wages including the transpacific partnership. >> all right. and they're running against each other. joining us now, contributor barney frank advising the clinton campaign and senior contributor larry kudlow, unofficial advise tore the trump campaign on economic issues. they agreed on carry ied capita and trade in the aggregate here. barney, when's going on? >> there are some obvious things that are overwhelmingly in the national interest.
as to infrastructure, the combination of the lack of activity in the past, the great need that's grown up, the jobs that offers to middle income and working class people across the board, not necessarily people with high-tech skills, and the low interest rates, it's an obvious, logical thing and i feel good about that because it means -- obviously i want hillary clinton elected president. i'm assuming based on what donald trump says if she is elected and makes a proposal for a large, infrastructure program in the hundreds of billions she'll have republican support. i know if donald trump was elected president he would have democratic support. i'm encouraged by that. there are even in that area and i'm getting rid of the carried interest. i am -- that had been a partisan issue in the past. i'm encouraged if hillary clinton is president and proposes abolition of carried interest there's enough republican senate support to overcome a few democrats who haven't been enthusiastic about
that. so the one difference there's still this in trade. i want to stress this. i hope the president is listening. i admire the president and agree on almost everything and i think he's hopeful in the lame duck session to ratify tpp. that would be the worst thing to do for the temper of our society. i don't see how anybody can look at what's happened and say after the election, let's sneak tpp through. i hope he reads that. >> yeah. i mean, larry, i would like to hear from you on all of this but especially infrastructure spending which strikes me because president obama has sent years fighting house republicans on this very issue. >> well, look. i'm not opposed to infrastructure spending. i would like to see it reformed substantially. mr. obama had a huge infrastructure spending in 2009, 2010. it didn't really work as well. the shovel ready projects weren't there. i might add that congress just passed over $300 billion
infrastructure spending appropriations over 5 years. mrs. clinton wants another 275. i don't think it's a miracle cure. and i think even though there's some agreement on some of these things which i appreciate with barney, the big differences here, mrs. clinton wants to raise taxes across the board. she's railing against rich people, corporations, wall street, capital gains, financial transactions, to name a few. mr. trump and the other hand centerpiece of his plan is a substantial business tax cut for large and small companies, and also, personal income tax cuts. which to me the trump plan is a pro-growth plan. mrs. clinton's tax hikes in my opinion are not pro-growth and may be recession their. >> barney? >> larry is a great -- >> barney, i think your mike fell off. you want to check right quick? there it is. go ahead. did we lose him?
>> we don't have him yet. >> he is getting it. >> hold on. i got it now. >> okay. all right. >> larry's careful with words. look at what he said with regard to infrastructure. i'm not opposed to it. i don't like it but i can't think of a good reason to justify the opposition. i'm not opposed to it. it's a weasel word like mistakes happen. beyond that, the fact is that he said in -- we're talking not about this as a short-term stimulus. not a lot of shovel ready projects. they're relevant when you go for a short term stimulus in a recession. we are talking about a longer set of plans based on our overall needs and finally i do want to congratulate larry. you say he's an unofficial adviser and you underestimate the influence. i mean this seriously. he has been the most successful lobbyist within the traditional or conservative republicans of
donald trump. a man beating up on rich people and going after rich people and now larry successfully with a few others persuaded him before a tax plan for enormous breaks for the richest. the problem i have is this over and above the equity. going ahead with the infrastructure program to which larry is grudgingly not opposed, how do you pay for it? same time substantially reducing revenue in the near term? >> fair questions. by the way, i'm not opposed to infrastructure. i want it with form. >> you said you're for it. >> i was going to say it. look. i think the single biggest factor in the trump recovery growth plan is the business tax cuts for c-corp.s and s-corp.s. the biggest beneficiaries of this tax program will be the workers, labor unions. i also think pension funds which could be largely government workers and 401(k)s for private individuals will benefit
enormously from these tax reductions. i think it's long overdue to make america competitive and attract money back to the states and to get cash from all over the world to rebuild the country. let me finish. one last point, quickly. the best way to rebuild america in my judgment is to bring incentives that will make america the most who hospitable investment destination in the world and trillions of dollars will flow back into the u.s. to rebuild all america. all america. >> the problem with that -- >> last word, barney. >> larry, we talked about a business tax cut offset by some increases even in the personal. >> yes. >> what you said has nothing -- no justification for repealing the estate tax which hits only people who have a net worth of $11 million or more. it does not justify reducing the personal rate even below what george bush wanted. here's the problem. i understand your argument for targeted tax reduction for
business. but when you pile on to that and major reductions in the estate tax and the marginal rate for the riches, you erode equity and creating a larger deficit that i don't think is healthy. >> i think double and triple taxes inheritance is wrong and the issue here is not tax breaks. we all talk about fairness. >> i didn't take -- i'm talking about rates. >> mrs. clinton talked about fairness throughout the speech. i don't know what fairness means. >> all right. i have to go at this point then. >> pays a third in tax. >> google fairness and we'll figure out what that means. >> your interpretation. >> drop the mike, barney. >> not opposed to ending it now. >> mr. chairman, we will adjo n adjourn. thank you. good to see you. larry, as always, my friend. has the death knell rung for stock pickers? we'll debate that issue. still ahead, low gas prices, nice weather, open roads, it's a
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take a look at how we finished the day on wall street. modest declines for the dow and s&p 500. with the dow finishing lower by 37. the nasdaq the bright spot. the tech heavy index managed to make a new record high and close higher, bill, for the seventh week in a row. best winning stretch since 2012. meantime, stock pickers are feeling the heat. according to morningstar, this is interesting, investors pulled out $317 billion out of actively managed mutual funds over the past year and they added $373 billion into so-called passive funds like index funds or etfs. >> as investors shift strategies, could it be the end of the stock picker or the beginning of the end? with us, ross gerber, chris wang and of course evan newmark has
some strong opinions, as well. ross, we'll start with you. in defense of the stock picker. for those savers with low returns and wondering why to pay someone to manage money and stick it in an etf with the indexes at record highs. >> well, i think that that's a simplistic way of looking at investing in etfs. building a portfolio is more than 100% of the money in the stock market and s&p 500. so talking about stock picking, you do better with stocks than an etf. good at picking stocks. because ten or 20 or 30 stocks are 500, you know, stocks any day of the week. just statistically speaking so really what it is about is concentration and picking the right investments and i think that's the real challenge is how do we pick the right investments. >> all right, chris. take the other side of that trade. >> most people aren't good stock
pickers, retail investors. on the professional side, 80% of active mutual fund managers also underperform so you're going to be better off in a passive fund over the long term. >> evan, break the tie for us. >> it's statistically this isn't even close. i mean, the number of actively managed funds that over time beat out the indices is almost in infinite -- >> let me -- >> let me finish. the best tell over 20 years is fate of bill miller. he was baron's active fund manager of the century. he was the guy who beat the s&p for 15 straight years. if you put your money with him any time but at the end of front end of that 15 years, you ended up losing more money than gaining because he had a dismal three or four-year run that killed the runs. for most people, and this includes hedge fund managers who
have also grotesquely underperformed and private equity managers over ten years grotesquely underperformed, the case for active fund management is not made but every now and then there's a couple of people out there who will do it. >> explains the flows. >> exactly. >> ross, go get him. >> explains my flows in millions of dollars a week. the other thing to look at is if you go to class in any can college 75% of the people don't get "as" or "bs." if you take a bell curve and 8,000 mutual funds and way too many. they sell the products and one of the reasons they fail most of the time is simply fees. so if every active manager charged 25 basis points on their fund, the amount outperforming the market would be so much more because what you're not talking about is that this is really about fees, it is not about
investment performance. people have wised up about fees. but american funds which is our core fund family has most of their funds have beaten the s&p over the last 10 years and the fund reuse the most, number one fund, the balance fund at american funds, has 40% out of the market and has beat the s&p over ten years. you have to do your research. it is not that hard. >> chris, the other thing that struck me as actively managed funds underperform in an up market and they do better in a down market because index funds, they're stuck. if the market is down, they're down, too. >> that's correct. >> what happens when the market goes down? you guys aren't going to be smelling like a rose anymore, will you? >> no. down markets you have to be tactical and not just in a pa passive fund. that's why active managers get paid. we are in a liquidity-driven market. the central banks are printing trillions of dollars every year. >> some of them are even buying etfs actually. >> keeps on flowing into etfs
and see the market continue to rise. >> all right. we got the adrenaline flowing. thank you, guys. ross, chris, thank you for joining us today. >> thank you. >> i have a feeling we'll have this debate again. the trend continues. >> oh, absolutely but just moving on because what happens after the gold is gone? once the olympic games leave it is not always the economic boon for cities that it was cracked up to be. we are told. a special report on rio is coming up. but first, it is official. he is back. the long rumored return of a certain key figure in the new "star wars" movie confirmed in the olympics last night. the music might give you a hint. "star wars" fans get ready. we have all the details next.
as sara telling me, disney's first "star wars" film collected more than $2 billion worldwide and for its next release "rogue one" it is tapping into an old friend, an old enemy that should boost the next film's fortunes. yulia boorstin joins us from los angeles with all the details. julia? >> that's right. a biggest winner at the olympics yesterday is the "star wars" franchise because the trailer for "rogue one" debuted after men's swimming last night. this trailer already been viewed on youtube about 5 million times and over 12 million times on
facebook's star wars page and the trailer is playing in many other places. "rogue one" takes place before the original 1977 story line but it isn't directly part of the core "star wars" saga and opening december 16th and key to maintaining brand momentum for disney after the "force awakens" massive performance last year and consumer products and two "star wars" theme parks for disney world and disneyland. concerns of reshoots of concerns that it would disappoint and bob iger said fan enthusiasm is on par and reminding investors there are four more "star wars" move vis in the works for after this one. fans are particularly excited about the fact that the trailer f fee churls a cameo of darth vader. we have to see if it drives big
gains at the box office. >> thank you. >> there's a rumor, a rumor. >> what's that? >> going to make "rogue two" about the origins of jar jar binks and single worst "star wars" character of all time. >> there's a few questions here for disney investors. is "star wars" getting the hype as the last one. number two, will it matter where all the focus is espn s subscriptions and cord cutting? >> great franchise. >> this is not the next in the "star wars" franchise. a sidebar story. >> a weird one. >> it is. they're making a huge investment in "star wars." >> could hope for "rogue two." do you see jar jar? >> you hold that thought there. as the olympic games in rio enter week two, questions of brazil's future bubbling up
again. >> will rio face the same fate or a comeback of the country this needs it very much? the economic impact is coming up next. hey gary, what'd yogot here? this bad bs a mobile trading desk hey gso that i can take trading platrm wherever i go. know that thinkorswim seamssly scs across all your devices, ght? , so my stom studies will go wi me? anywhere you want to go! the market's hot! sync your platform on y device with thinkorswim. only at td ameritre
putting on a world class sporting event certainly comes with a price tag in the billions. our carl quintanilla takes a look at the cost of the games in rio and whether rio will see a profit. ♪ >> reporter: after the fireworks and the athletes are gone, the cost of hosting remains. and according to an oxford university study it's not money
well spent. researchers say the games have a crowding out effect where non-olympic tourists and residents avoid the host city because of congestion and high prices. the uk saw a drop in international visitors in the london games. some critics argue athletes and families stay wrapped in the olympic bubble and don't spend like typical tourists. another downside, infrastructure investments don't always pay off. the tab for athens in 2004, $15 billion, is widely blamed for helping to bankrupt the country. and sochi home of the most expensive olympics ever is home to an underused stadium and public transportation system which cost russia $1.2 billion a year to maintain. question is whether rio's $12 million investment will pay off. organizers said the city keeps about 60% of the profits. organizers say it modernized the
city as the recession kept private investment away. >> that from our carl quintanilla wrapping up his week in rio. we have a news alert on several 13-f filings coming out. susan li, what are we learning? >> hedge funds holding at the end of the second quarter. david tepper and an interesting decision to resolve. cut the calls by 550 million. that's half of a billion dollars cut and gm they have reduced their position in general motors $1 million shares. and this is the interesting trade because they dissolved the position in facebook but they added their position in alphabet and might be a long alphabet short fb. and pfizer, another position i want to highlight for apple and 2.5 million shares and now triumph management.
a big change here in the fund holdings and that is leg mason. they have dissolved it by 11 million shares and then third point quickly. make it quick with dan lobe. the most interesting part of the new portfolio is that they sold down their yum call so they're down to 2.5 million. originally 5.5 million and sold the 1.5 million calls, as well. twenty first century, a position they dissolved and time warner cable, sold out of the position they had in time warner cable. new positions that dan lobe added at third point, activision and facebook is a new position and union pacific, the railroad company. lots of moving parts and back to you. >> lots of action on facebook. thank you very much. the weekend is here and thinking about hitting the road, "closing bell" might have just the thing. >> yes. analysts are making winnebago stock a buy and we'll look at why when we kick the tires of two rv models and an interview
of the company's ceo. ll yr buness be read when growth prests itself? our new cocktail bitters were doing well, but afteone tradesho we toooff. all i could thabout was r deadlines racing towards us. a loan would take too long we needed money, now. my amex card helped me buy the ingredients to fill the ders. opportunits don't wait around, so you have to be ready for them. find o how american expreses cardand services can help prepare you for growtht open.com.
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homes at the highest level in nearly 40 years. over 226,000 rvs have been sold just this year. and according to the rv association, the industry pumped nearly $50 billion into the economy last year. >> unbelievable. joining us outside the stock exchange, looking at a couple of new winnebagos there. i remember after the financial crisis, everybody said, nobody's going to buy a winnebago tomorrow and gasoline at $4 a gallon. everybody said nobody's going to buy anymore. you're setting records in terms of shipments. what happened? >> the industry on the seventh straight year of record shipments. low interest rates, affordable fuel prices, access to financing, and really, confidence in the market and the equity markets performing well. >> well heeled baby boomers? retiring. >> absolutely but seeing the average age drop. getting into towables and trailers and exploring. >> when they graduate college and go on a national trip.
>> not like this baby. how much does one of these cost? >> this is our vista 29ve. one of our motorized products, more affordable products in the class-a category. listed a little bit over $100,000 for a family of six to seven folks. very comfortable. >> we're in a spot right here where you could tailgate. right? >> this is the tailgate package here. >> really excited about this. >> we can go to a rams game. >> absolutely. >> stocked? >> cold beverage. >> you mentioned low interest rates and financing. what percentage of the customers do finance these purchases? >> two thirds of the customers to make the purchase of the rvs and access is hanging in there and optimistic to hang in there for a little while longer. >> what about the cost of gasoline and fuel? i mean, do you see a ebb and flow in sales when that happens? >> cost of gasoline has an
imfact two areas. one, how much people use the products. number two, interested in getting into the category. when the fuel prices go up, we see actually, you know, the usage slow down a little bit. but where gasoline prices are now, people are comfortable with taking the products across the country. even if they're towing. >> how many miles to the gallon? >> oh boy. probably somewhere in the low to mid teens. you know? >> even in the teens? kind of surprised. >> our trailers, you have the ability to take a half-ton pickup truck or a sport utility vehicle and they can get you across the country and other affordable ways. >> nice stuff. >> not down to the stock exchange on wall street. >> maneuver out of here down broad street here. >> tight fit. >> that does it for "closing bell." thank you, sir. have a good weekend. >> thank you. >> sleep well this weekend. >> i will. >> kelly is back on monday. hope you are, too, as well. stay tuned now for the olympics. have a good weekend, everybody.
do it again! he reaches for gold. >> he did it! ♪ it is day seven of the rio olympics. we've already seen son sentlating action especially in women's soccer, and there is much more to come. hi, again, from our olympic headquarters. we have a variety of sports to kick off your viewing weekend. we have the quarterfinals france and canada. but it is time for the four legged