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tv   Fast Money Halftime Report  CNBC  September 14, 2016 12:00pm-1:01pm EDT

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remember, disney bought lucas film for $4 billion in 2012. a deal that got laughed at at the same time. not so much anymore. >> at the time the franchise seemed to be pretty much dead, and killed in a way by its own creator. a lot of people didn't think it was possible to revive. >> let's get over to headquarters. wapner and "the half." i'm scott wapner. delivering warnings. why so many big investors say there is danger lurking in these markets and how to protect your money as volatility returns. with us for the hour today steven weiss, jim, john and pete. also with us on set today, dubrasko lakos. stocks steady this hour. trying to come back. there's the dow up 64 points.
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s&p, nasdaq positive. big story, though. what bond yields are doing today following that big spike in the yield on the ten-year note. pulling back just a bit. maybe giving some feeling of ease to investors today. pete, boy, the commentary yesterday after delivering alpha was mostly negative from the biggest investors. how do you see the landscape? volatility is back. >> volatility is back. >> you follow it so closely. >> we've seen an explosive move out of it. we've been talking all the way back to july about this low grinding volatility and the fact that we've been trading on the vix between 11 and 13, and finally, we get the big spike this past week. we got a big spike in volume because people are back and now they want to be involved in the markets. i think there's enough concerns out there, scott. when you really look at what's going on, they delivered at this delivering alpha a lot of really gray clouds, didn't they? there was not a whole lot coming out of there. bill miller stood out for me the most, and the reason i say that is -- >> he is one of the most bullish
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bulls. >> he talked about the s&p 500, and the like the fact that he did calculate out some very individualized names. it was amazon and some of the airlines. he really did pull out. i think delta is his favorite right now of the airlines. when you really look at what bill was saying, he certainly didn't sound like everybody else. he seemed like he was looking through glasses completely different than everybody else at the conference. >> here's a good point then. is it a bill miller market or a paul singer market? paul singer was among the most negative speakers of the entire day, talked about the possibility of bonds and stocks going down together that the risks now -- it's getting dangerous. >> let me put it this way. bull, who is a great investor, has been a great investor for a long time, ledger investor, has a different perspective. he is a long only investor. he is a long only equity investor. if you look at the perspective of the other investors, whether it's paul singer or it's dalio or carl icahn, they come at it frr a more holistic way. they're looking at bonds. they're looking at the credit portfolio. they're looking at the spread.
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the ten-year over the high yield. they're saying not so much that we're looking at a valuation, but they're looking at there's nothing out there to buy. that's what resonates for me of all the hedge fund managers that i have talked to and investors. i can't find anything where there's a compelling risk-reward. i can only find very, very little. it's not that markets overall are overvalued. they come to that almost from bottoms up scenario. individual securities, individual asset classes. i'm just not finding what's worth the risk. >> the question is whether we're going to have some kind of meaningful pullback, correction, reset. however you want to phrase it. you think we will. your target on the s&p for the end of the year is 2000. it's the lowest of the major firms that we find on the street. >> i think the right thing to say is there's a lot of caution mongsz investors. if you look at which parts of the market have rallied it and done well so far this year, within equities, within s&p's,
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it's your low tstocks, your yied plays, right. they are trading at record valuations, and there's a lot of need for volume to stay low in order for the markets to keep these levels. the reason for our ka us is basically linked to the fact that there's perhaps a little bitcomplacency. i would watch for further correction and take advantage of that to turn slightly more constructive. fundamentals are improving, but, you know, from fairly low levels, but i would say prices have ran ahead. >> there has been a reliance, and that's an understatement of epic proportions on central banks around the world. here's paul singer yesterday from delivering alpha on what the impact of that has been and what it could be as they pull back. >> what they have done is created a tremendous increase in
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hidden risk. it's a risk that investors don't know or have faced about their holdings, and i think it's a very dangerous time in the global economy and global financial markets. >> tell you, part of john singer agency comments yesterday sent the yield on the ten-year ripping. almost at that very moment. that pulled stocks down. what's the most important thing to watch today? >> it's something we're not talking about at all, scott, which is earnings. we've been talking about interest rates for a long time, says and, look, i do think at 1.7, 1.75 on the ten-year, there is a natural tether with which interest rates are around the world. i'm not going to worry about interest rates rising too much from where they are now. what i am worried about is earnings because this market -- the stock market -- really is priced for a second half pick-up in earnings that should crescendo into 2017. we really need to see that. we'll get the third quarter earnings season coming up in a few weeks. we need to see confirmation that
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the earnings growth is resuming after two years of flat earnings to justify the stock market where it is. >> you think the fed moves this month, next week? >> what is the -- what's at the heart of your risk in the market? you see what a 6% pullback from where we are now. that's a good correction. the risk that i think we face number one is volatility. you mentioned equity volatility has been close to record lows the last two months. it's been in line with bond volatility. not very typical. if vol starts to pick up, that could trigger a series of deleveraging events. just to give you one example, systematic strategies. they're currently at 97, 98th percent i'll. very low. longer than they were pre-brexit. any sort of pickup in equity vol likely results in some type of deleveraging and puts pressure on the market, and the other part we need to watch. i think that's a fair question. we need to see on the 21st of
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this month what happens to bank of japan. do they continue to provide further evaluation. if yield spikes up, that could pressurize the market. >> you think a pickup in volatility is going to scare people and force them to sell? >> not immediately, but what it will do is it will likely result in further deleveraging, and that could then eventually start to scare people, you know, result in negative sentiment, pickup in risk aversion. >> i'll make this quick, but to your question, i see a lot of retail flow. speak to a lot of clients. volatility does scare them. certainly saw that in january, february. a lot of people did decide to sell out or at least reduce risk right at the wrong time. as we see volatility. it does scare people. >> we would have had kags prior to the election in any case. we would have had some caution.
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they're reacting because they're active managers, even if they have a long-term view. they're reacting to what happened on friday and what happened friday was basically the fed threw the playbook out and said we don't care about data anymore. the three data points, both pmi's and the jobs report, were negative. >> i will push back with you on this. >> why did he talk about hidden risk this time? >> these people were warning about dangers within the market well before the fed on friday said -- >> very true. >> we may raise rates next
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month. >> very true. the hidden risk that i think mr. singer addressed very accurately in that clip that we played is exactly that you just changed the game plan, and the volatility that you are talking about, that just got reintroduced in a big way, and the volatility that jim is saying that his clients are worried about, it's much bigger moves when you are at a 12 level. it's much easier to get a 40% move in vol than when you are at 22. you're not going to see very many 40% moves when you are at 22 for the vix, but when you are at 12, it's an easy move just as it was last -- >> some will have you believe that -- you should go long the s&p, and you should short the ten-year treasury. >> but he is an equity guy. right? that's -- >> that's where a lot of people watching our program are. what's the better call? to go long the s&p now or short? we always talk individual stocks. broader market trend. >> i think clearly if you take a look at history, you are going to see that the equity risk premium on the s&p, which means that when it's safest to buy,
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when you get paid most to buy on the s&p, says is not at an attractive level. if you take a look at the valuation, meaning the yield and sovereigns, that's even more unattractive. if you have to put money in one place or the other, you are going to put it in the s&p. if you take a look at what's happened with the rates, you can just say in terms of central bank, we haven't really talked about this, if the u.s. is not easy anymore, it's a question when they're going to tighten. they're not buyers. the ecb has said there are no more sovereigns to buy. that's why we're buying corporated. we don't know what japan has done. they're going to run out of their own debt to buy in the next year to 18 months. they're talking about buying equities as the ecb maybe. there's no more central bank buying of sovereign debt. those yields can't go down. they've got to go up for that reason alone.
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>> if i can add a few thoughts. >> please. >> you look at japan, government yields. you look at bond yields. if you look at even treasuries from a foreign currency perspective, they've all basically hit skblzero or negat territory. that's had spillover effect into equities. i referred to this term low vol. it's basically sustainable income stocks. stocks that provide the 2.5%, 3% income with decent balance sheet. that's what has driven the market. if you look at the multiple price, it's rerated quite a lot, but if you start looking beneath the surface, we estimate almost entire rerating of the multiple comes from a select 50 to 100 stocks. you freeze those, multiple has not changed this year. that's i think when they refer to hidden risk, that's one of the risks they might be alluding to. utilities, telcos, staples, safe havens, unchanged.
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>> if you go back a couple of years also, utilities have continued to outperform. then you had health care the one sector also -- >> you say those are the places to get out. >> exactly. >> rotate from. >> because they've been the biggest beneficiaries of these macrotrends off central bank policies, falling yields. >> the market is exactly where it was last may. 15 months ago. there's been no movement in the s&p. >> pete, if you are inclined to be a bill miller guy -- >> which i am. i'm listening to these guys, and they're talking about, well, all the money has been in these places, and they've been performing. yeah, i do think there's a rotation. that's why i am not sure why you're quite as bearish because if there's a rotation out of those and they're still going to be looking for equities and still looking for yields, sounds to me like you're telling me, look, tech, that sounds like a great place to be still. the semisounds like a great place to be still. there are places out there where valuations are great, the yields are fantastic, the balance sheets are incredible. by the way, many of them are still growing. if you look across and you look
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at what the earning season told us, there is growth. there was a low bar. >> you want to answer it? >> just based upon the -- >> if i was in 1900, 1800, 1700. 2,000 means i expect some form of rotation going forward. roughly a sideways moving market. areas that have benefitted from a lot of these policies might be at a relative disadvantage in other parts of the market be it hek or health care. i think it's an attractive sector. you could continue to see this. >> we saw 6% in january alone. >> right. >> so are you just looking for a slow drip, or are you looking for that one event you just don't know when it's going to happen for that vol spike? >> i think september. what i'm looking for is perhaps the next few days. up until september 21st. there's a lot of us going into bank of japan meeting, and there's some -- >> i'm not sure exactly whether
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rettic going forward. will the degree of compensation resist or will they turn marginally less dovish? it could be higher, and you could continue to see further pressure in the market. >> that's the rusk that i'm thinking. >> do you think the market is complacent at that point? >> i think there is some complace ensy, both from a yield point of view and as we were talking earlier, from an equity vol point of view. if it normalizes, that could just mean some deleveraging, some parts of the market get flushed out, and then i would say perhaps turn slightly more constructive. >> as we've heard from others, tony dwyer who was with us, looking for maybe 5% pullback and then it becomes attractive. big money managers out there are looking for the same kind of thing so they can actually get money to work. thanks foreign coming out here. >> thank you. >> head of u.s. equity strategy. here's what's coming up on the halftime report. >> apple picking up steam. the stock is up big since monday. still time to plug in?
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carl icahn making headlines at dlirg alpha. >> let's not confuse stock market and the economy. i know maybe you don't want to hear this, but, you know, stocks can go down. >> carl icahn hitting the markets, the fed, politics, and, of course, the herbal life trade. before the break, if you think higher interest rates mean a drop for stocks, check this out. our partners at kensho show when ten-year kreelds yields rise above 2% in the same month, the s&p 500 rose 10% on average. semiconductors, materials, energy, and industrials were top performers. for more on that, go to cnbc.com/pro. more "halftime" with scott wapner in two minutes. builds an appliance, they put everything they know into it. but once it's sold, there usually isn't a way to keep improving that product. today, whirlpool can analyze iot sensor data from connected appliances on the ibm cloud. so they can continuously learn how customers are using their products.
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this is the new comfort food. harnessing data to make great products better - and it starts with foster farms simply raised chicken. california grown with no antibiotics ever. let's get comfortable with our food again. we are back. take a look at the stocks of apple. they have been soaring. the rally has legs. five reasons why apple is still skrening by. there's the list. samsung's most recent woes. pete, among them -- >> it's definitely. >> quite a move. >> i think the samsung thing is becoming bigger and bigger. you look at the ecosystem. they point that out. i think that the most important thi thing, after they released some of the specifics about the phones and so forth, we all know the phone, the big percentage of what that really is for apple still. when you look at the phones and you look at the process or and you talk about -- it's more
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water resistant than water proof. it's absolutely i think -- it's cutting edge technology. it's much better technology than they had in the past. i know you disagree. i'll tell you what, i think that is what's propelling this. that's why you're seeing record numbers at t mobile and sprint, and you start looking around. why is there so many preorders? because there's a difference. the phone itself looks the same, but what the phone is capable of doing, including the camera, which actually does replace the need virtually to have a regular camera, scott. now the phone truly has this dual camera that actually is a difference maker as well. >> you still maintain that's not innovation to you? >> how can be it innovation when samsung and -- it's innovation for apple. samsung had the dual camera. lg had the water resistance. >> that has been the story. it's something we've gone back and forth for a long time. years now. that's been the story for apple forever wru forever.
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they make things better. that becomes innovative after some time. >> i don't know that they made it better. >> really? i think they did. >> the battery life. the processing speed. their own chip in there. yes. >> you can tell me that you've compared it to samsung's camera. you compared. you don't know if they've made it better. it's innovative for apple, and i get that. it gives you a reason to upgrade your iphone. now, i get that. the numbers are so blatantly good for the apple preorders, there's going to be a mystery behind that. now, look -- >> it's not a mystery. we just talked about it. that's not the mystery. it's a mystery to you, about the -- >> it is a mystery to me. >> clearly. look at the numbers. >> i think -- i don't have anything -- >> how about the fact of the pods and everything else. >> how long has it been since you have carried a camera? >> forever. >> okay. give me a reason not to carry a camera. >> i see it in times square all the time. >> you're going to continue to -- >> why has the stock been running the way it has been? >> well, because it's what i talked about too, judge. it is that these damn things wear out. it's not true that you can take that thing for four years.
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in a year and a half the haptic is shot on my iphones because i'm a heavy user. anybody else who is a heavy user and that's an awful lot of the people that are devotees of this country, are wearing the things out. also, says when you have the things that pete talks about, stereo speakers built into it, the much faster processor, the a-10 fusion, much faster processor. i would say -- i mean, for instance, when i got on the plane today, steven, you know what they said. >> hi, john. >> hi, john. >> buckle your seat belt. >> welcome aboard. here's your bloody mary, sir. when i got on the plane -- >> welcome to teeterboro. >> please do not power on any samsung 7. please do not charge any samsung device on this plane. >> i get that. i get that. clearly -- >> it's better than the samsung.
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>>. >> attractive valuations. asp's, they're looking for higher prices. something that you're sort of talking about. also the december boost that the stock may get into the holiday. >> right. >> and as you know, apple doesn't release these numbers. the numbers we're seeing right now are from t-mobile. t-mobile, great carrier. one of the smaller players. great carrier. >> good carrier. we're talking five years. >> it's one big -- >> i love john and what he has done. >> let me purse some stuff out. we don't know if they'll be around in five. >> we're missing that for a year the stock has been in the doldrums, and the shares have been changing hands. everybody who road the growth wave in apple, it more than doubled from mid 2013 to mid 2015. then it had to go through a year-long process of changing hands from growth to value investors. that's done. everybody is now looking at the valuation and saying 12 times, 10 1/2 times if you strip out the cash? we're all in. nobody is selling it anymore. there's only buyers.
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this stock is going higher, just like it did after the selloff in late 2012. >> what did we talk about last week? if you get a chance -- this thing slams down to 105 -- which it did, we'll reload with more of the 110 call spreads. i'm not looking for it to go to 115 and 120. would that be great? sure, it would. i'm looking for just that little $5 pop to the up side. now we've had it from 105, actually, to 112 so we've had a $7 pop. i'm very happy with that, and i think if you invest right -- >> just to be clear, i'm not a bear on apple. i'm not negative on apple. i think it's a great company. i just say that it's not this tremendous growth company anymore, and they still do lack innovation. they've innovated and they have upgrades. the big innovation will hopefully come with the anniversary model, and they're right to save a lot of that innovation. it is a cheap stock. it's a perennial cheap stock. i disagree. i think it's the same value story it was i year ago and a
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year before that actually less of it because they don't have the growth they had. so it will trend up, and there's some momentum. >> okay. put the bag back on the shelf. why morgan stanley thinks the recent pain for retailer coach is just beginning. the call of the day is next. plus, much more from delivering alpha, including my conversation with carl icahn. >> alpha is not gone. alpha hasn't disappeared. we've had three quarters of consistent outflows and hedge funds, and everybody thinks, you know, says my gosh, what's happening? is it it's fine. it's fine. capital is shifting. >> this massive move to indexing from a trading point of view has changed the way stocks trade. my strategy has always been longer term. one to two years out. if i'm a manager, i have to start looking further out if i want to generate alpha. >> hedge fund strategies are cyclical. what we've seen of late is a function of crowding into certain strategies. >> places that a manager can create an advantage in the past are also disappearing.
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>> eventually the strong survive, and, by the way, it's not a bad time to have a weeding out of people who, you know, aren't the best stock pickers. now that fedex has helped us simplify our e-commerce, we could focus on bigger issues, like our passive aggressive environment. we're not passive aggressive. hey, hey, hey,
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there are no bad suggestions here... no matter how lame they are. well said, ann. i've always admired how you just say what's in your head, without thinking. very brave. good point ted. you're living proof that looks aren't everything. thank you. welcome. so, fedex helped simplify our e-commerce business and this is not a passive aggressive environment. i just wanted to say, you guys are doing a great job. what's that supposed to mean? fedex. helping small business simplify e-commerce. remember here at ally, nothing stops us from doing right by our customers. who's with me? i'm in. i'm in. i'm in. i'm in. ♪ ♪ one, two, - wait, wait. wait - where's tina? doing the hand thing? yep! we are all in for our customers. ally. do it right.
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zbliefrmt we're back. coach shares under pressure after a downgrade to sell from morgan stanley. the firm questioning if a sustainable turnaround is actually taking place. it's our call of the day. what do you make of this? what do you make of it? >> i think this is such a tricky sector to invest in. i take a look at cores and i see another stock that really hasn't been doing anything. what are we going to do, break from coach into coors? it's the same thing all over. it's hard to decide where the fashion trend is going. >> year-to-date the stock is up 8%. people have been clearing betting that the turnaround is taking place. they raise questions, and he this say our definition of a turnaround is sales growth with stable margins or stable sales with negative is it% down side to our unchanged $3 price target. we move to underweight. coach has not delivered on whoo they say their definition of turnaround is. >> again, to my point, this is just a really tough sector to invest in, and unless you really have a fashion sense and you have the inside scoop on where
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the next trend is going, i stay away from these things. same thing with kate spade. it's another stock that goes nowhere as there's a circular rotation from one name to the other as they're perceived to have the nets next greatest thing. >> that's why exactly i jumped into kate spade. it's not just a recent trade, as jim knows where. >> because you carry your bags yourself. >> exactly. >> it's called a man purse. no, i jumped into this kate spade on the big selloff. if coach had a big selloff, jim, i would jump into that. it's not had. 88 cents. come on. when kate spade went from the low 20s to 15, judge, or $14, that's when i jumped in. still hold it today. >> they only have two sells. this call becomes one of those. they have 19 buys and 13 holds among the analysts who follow the space. >> it has a fat yield on it. if you are looking, which you don't typically see in retail, other than some of the broad lines, look, we had numbers come out from hermes, and the numbers were good from last quarter, but going forward the guidance was
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squishy. mont blanc -- >> coach in the same category as those? >> no, i'm not. coach is thought of as a luxury brand, and it's not a luxury brand. it's a betweener brand like michael kors, and those are too fickle. fashion, with the internet and on-line, it seems to move a lot quicker, and it is very, very fickle as the shoppers are. i would stay away from it. i this it's too difficult to play. we do have to give a disclaimer. before john talks about fashion, we have to do a close-up on his tie. take a look for yourself. >> all right. it is just past 12:30 on the east coast, and here's where markets stand. take a look at the major averages holding steady from where we began the program 30 minutes ago. the dow jones industrial average at 18, 131. it's a gain of 65 points. one-third of 1%. the s&p is at 2,135. nearly half a percent gabe. nasdaq, the outperformer today at 5,196.
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sue herrera has the latest for us. >> hi, scott. thanks so much. here's what's happening. ford's chief, mark fields, says all of the company's small car production will be leaving the u.s. and heading to mexico over the next two to three years. he made the comment to wall street analysts at an investor conference hosted by the company. two of the syria men believed to be sent to germany by isis leaving a federal court of germany today. they were detained along with another syrian after a series of raids the day are. the three described as part of a possible sleeper cell by authorities. british prime minister theresa may says controls will be imposed on the movement of people from the european union to the united kingdom, but she refused to confirm that e.u. citizens and non-e.u. citizens will be treated the same under post-brexit immigration rules. once again, the world's busiest airport is hartsfield jackson in
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atlanta. it moved a recordbreaking 100 million passengers last year. that's according to an airport trade association. the airport is within a two-hour flight of 80% of the u.s. population. you're up-to-date. that's the news update this hour. scottie, back to you. zoo all right, sue. thanks. casino stocks are on a roll after a bullish call. plus, options, activity pointing to a big rally in one commodity etf. the nagarians are on the case, and they're doing it coming up. energy is a complex challenge. people want power. and power plants account for more than a third of energy-related carbon emissions. the challenge is to capture the emissions before they're released into the atmosphere. exxonmobil is a leader in carbon capture. our team is working to make this technology better, more affordable
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so it can reduce emissions around the world. that's what we're working on right now. ♪ energy lives here. with dand bold styling to to stay ahead of the curve... the lexus rx, rx hybrid and rx f sport. this is the rx, elevated. this is the pursuit of perfection.
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zbliefrmt welcome back. the always entertaining and enlightening carl icahn at the sixth annual delivering alpha conference yesterday. here's a look and a listen. >> i would think there are tremendous risks, but i think anyone who is going to tell you it's going to go down tomorrow, next week, even next month or next year, it's sort of a guessing game, but you could look at the environment and i think it's very dangerous. in other words, you walk on a ledge, and you might make it to the end, but, hey, you fall off that ledge, you're going to really see trouble. if you don't raise interest rates, i think we're in a major bubble. if you don't have jobs and you
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don't have people working, sooner or later this blows up. you know, it blows up in so many different fashions, but it's simplistic. our economy is not doing well. i'm not here to sell herbalife. i have permission to go to 35%, and here's a secret for your show. i've asked permission -- i've gone to the fcc to get accelerated treatment for the right to go to 50%. they make some good products, i believe. i personally don't like the drink. i drank it. it gave me a lot of gas. i didn't like it. but a lot of people love the damn drink. >> yeah. he doesn't disappoint a crowd. that's for sure. a couple of things. we talked at the top of the show about the market anxiety that so many of these legendary investors are feeling and talking about. now, what about his point specifically on the interest rate question? okay, you had jamie dimon this
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week saying you should go ahead and do it. ray dalio said don't do it. he disagrees. you have asymmetric risks. icahn says if you don't do it, you're going to be in this tremendous bubble, and that's a thought that was somewhat echoed, i think, this week by i think eric rosengren. maybe it was one of the other fed officials who said it. the point was made about these bubbles and rates. what's the right call here? >> i think they should do it because you don't know. right now you can do it. the market has essentially done it for you with backing up rates globally. it's almost like the fed has a freebie. that there's -- even though the odds of doing it according to fed funds futures have come down dramatically, i don't think the market would be surprised if you did it. 25 bips isn't going to throw anybody over the edge. it's not going to impact any real asset class. 25 bits, you are at historically rock bottom rates.
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i say do it. >> this comment that he made, in other words, you are walking on a ledge, and you might make it to the end, but you fall off that ledge, you're going to really see trouble. i think that could well be. >> it's not that big of a drop. i'm just going to ek tend metaphor and what steve was saying here is what you are implying and i am agreeing with that it's one and done. i don't care if they go in december. they're going to be on hold six to nine months after that. the economy globally isn't strong enough to support a rate hike campaign, which if it this were 2006 and you had ben bernanke raising a quarter point every meeting, then you would have a very sharp drop-off off that ledge. right now it's just 25 bates points. it's nothing. >> i'll extend it a little further from metaphors. they're walking on a ledge, but they're on the first floor. i mean, you know what i'm saying, scott? when you really look at this thing, look at where we are with the rates. this quarter point, like you say, we're at record lows. we go a quarter point. if that really is going to mess up the market and get us to get some sort of an 8% sell-off or
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some crazy thing, then i think it will create some opportunities because that would be an overreaction of the markets once again. listening to everybody yesterday at delivering alpha, it's basically an inside of what it looks like at the fed, right? you have guys who want to raise. you have guys who don't think you should raise, and everybody has their opinion, and they've got good strong arguments. to your point, steven, i don't think it rocks the boat as much as people expect. >> look at it this way. we're not at crisis lives in the economy anymore. look at how far employment has gone. to think that you still need crisis level rates, i think, is ridiculous. give a nod to the market. give a nod to the economy. things are improving. go that 25. >> the herbalife, last time i checked it was up 6%. maybe it's come off that a bit. on this notion that he could go up to 50%, and even entertaining the idea of a tender offer at one point. he says he has thought about it, considered it. there's herbalife today. >> you look at the short. that's obviously a factor at what we're looking at, which is
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a a little more than a 4% move to the p up side. the percentages that carl was throwing around and even talking about potential of this thing even being private -- >> he said it would be better off private. not having to deal with all this -- >> that certainly makes a lot of people start to think, and how committed would this be, this whole process, when people are sitting there with this big short position that they're on right now in herbalife. >> he is still at 20%. he has to go to 35. he has not bought -- maybe he bought a few hundred shares in brett's names. how many traders do you know say i think it's going to be private or i filed to go up to 50% when they haven't bought any additional shares. i'm advertising to the market so i can buy at a higher price to get to 50%. >> right. but the flip side of that would be isn't that a shot across the bow more than anything else? would you want to be on the other side of the potential of that? >> no, but my point is i don't think he has any intention to go
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to 50% or any intention necessarily to go to 30%. i think he is doing the short squeeze. if you go back to what is going on in the markets, if you go back to what he did with conseco and irwin jacobs where he was on the other side and allegedly had a 22% short interest, in 2000, 2001, and it was mentioned by ackman when you did that famous thing on january 25th. he is on the other side. he did what he said no professional would do. he had a similar size short interest in a company, and jacobs was squeezing him. conseco went brought, and it worked out. it's a great way to squeeze the shorts. >> it was provocative icahn, as usual. apple soaring since monday. up almost 10%, as we said, and john is tracking some unusual options activity in a stock that's benefitting from that jump. first, michelle car reduka russa has a look on what's coming up. >> coming up at the top of the hour on "power lunch" delivering
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alpha delivered a lot of fear. many of the world's top investors ringing the alarm bells. are things really that bad? two big reasons why tim cook is literally dancing today. and the rich closing their wa walle wallets. what it means to the economy and high-end luxury. power at the top of the hour. >> the halftime report with scott wapner is the place for market moving interviews. >> you don't call a company a sewer because the company made a mistake. >> real money.
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i have to go wherever the work is. trains with innovative siemens technology help keep cities moving, so neighborhoods and businesses can prosper. i can book 3 or 4 gigs on a good weekend. i'm booked solid for weeks. it takes ingenuity to make it in the big city. back on the halftime report. we'll at the telestrator for the options market. what do you see? >> take a look at this one. it pains me to say it because jim has it in his halftime po portfol portfolio. >> good for you, jim. >> i see unusual activity at the 60 strike in october. the stock has been moving like this. it's been moving like that because of at least some because of apple and with this good news from apple, take a look at these calls they're buying. they're buying the 60 called in october. those are $5 out of the money. they've already moved up from yesterday right around that 55 cent level.
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take a look, judge. already pushing to a buck right now. i bought them. i'll probably hold them for at least two weeks. >> okay. good stuff. pete. >> i'm talking about silver, and the reason i'm bringing that up is the sl skr, some huge activity. you got this great view. you can see this huge ramp off, but we've been sort of choppy ever since. even maybe a little downward. here we are right there. the interesting thing i think going forward is somebody decided to come in today. the 18.5 calls october going out and buying those 7,500 of those. paying 41 cents. interesting to keep an eye on that, and the reason it's even more interesting is then they're also buying in silver. slw. when they're buying calls in both, the expectation is we might see the metals start to move to the upside in the next couple of weeks. it was shorter term. these are out to october. the others were september 23rd. >> you still like the metals, the miners, gold miners, things like that. >> i'm holding on to gld, and i also had a previous slv. i added slw, silver wheaton today as well. because i just sold out of it last week, had some good
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profits. i think there's going to be more coming. i want to get back in. i'm in both. yes, silver and gold. >> the brothers negarian with unusual activity. we'll stick with commodities, though. copper surging to a three-week high today. jackie deangeles at the nymex with the futures now traders. >> good afternoon, scott wrs. we're seeing a 2.5 move to the upside. we talked about that china data a little bit earlier. is that what's driving the move in copper? >> yeah, that's it, absolutely, jackie. copper is an industrial metal. the numbers out of china were good. the bank loans were good. the industrial number was good. the thing is copper has held some pretty good levels. it hasn't sold off. i think that the numbers coming out of china while not great, they're not as bad as everybody thinks they are. >> bob, can the momentum in the copper trade continue? >> well, you know, china not only is the largest consumer of copper, but they're also the largest producer. that's interesting. the same way that the u.s. is the marginal producer of crude oil, china is also the marginal
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producer of copper. this is an interesting story. copper has been an awful trade. you couldn't buy it down that low without some sort of catalyst. we got that catalyst. a 2.5% move in copper is huge. that's definitely short covering as well. if it doesn't get back below 214. expect -- >> more futures now. futures now.cnbc.com. >> jackie, thanks so much. >> a surge. shares are jumping on news from the fda. that's coming up next. plus, cracks at cracker barrel. the stock is on the move after weak guidance. the trades are just ahead in the blitz. i'm here at the td ameritrade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings.
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all right, let's do our trader blitz now. first up, ford unveiling a new growth plan today. >> a bunch of thoughts on ford. i prefer gm to ford because they seem to be a little bit ahead of the curve on autonomous driving vehicles. but you can own ford here and one of the things to note, they are as was reported earlier moving small car production to mexico, where they get their least profits from small cars. so it makes a lot of sense to ship it to mexico. there is a lot of cyclical companies like railcars that have done the same thing to pick up their profits on low margin metal bending industries. this is a good move for ford. >> cracker barrel is lower. they missed on the top to bottom line cut guidance as well. >> they missed by a penny on the earnings, not that bad. but you cut the q1 and go to
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full year and cut that as well, people won't like that. >> 7% back now. >> 7% back now. i still like this stock. you look at the valuation, the yield, this is a name i think can grow back into the level where we hit those 180s again. i think this is a buy. >> las vegas sands upgraded docket argus, the stock up 3%. >> and at the end of august, we cited on this show, the 26-month losing streak as far as revenue was declining every month for 26 straight months. they broke that streak at the end of august, mpel, wynn and mgm and lvs all have made moves since then. and argus gives them a recognition of that today, stock moving up nice on the heavy volume. >> serepta soaring after the announcement that the fda long critical of one of the company's drugs, a member there has departed. look at that move. you owned it. you warned of the risks that have existed here all along. the stock could easily go up 25%
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or down 25% on any given moment. >> yeah, actually could double from here if they get approval. the controversy is that the fda panel had not approved the drug, this is for muscular dystrophy, for younger people. but the commission of the fda, i believe, is going to come out and overrule the panel and approve it. and then hopefully happens by the end of september. the individual parkous was one of the main obstacles on the panel, he left to go to another company, so clearly that's why this stock is up. >> steve made a great call on this one earlier, got us into it. i have no position in it right now, but it was a great call by steve and we said wash, rinse, repeat. every time you get this chance in this stock, because it is giving you two or three of them this year where it slams down that big risk that he talks about, and it has been a screaming buy each time and you get moves like today. >> i do own some puts. deep out of the money puts,
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deeper out, i keep losing money in the puts, that's okay. >> that's your insurance policy, that's why you buy the protection when it is cheap. >> you don't complain when you don't die. >> some others do, but not you. >> okay. just three hours left to the market close. cut his mike. your final trades are next. plus, wells fargo down 5% in the past week after revelations that employees open fraudulent customer accounts. could this be a buying opportunity for the stock? "halftime report" back after this. opportunities aren't always obvious.
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wells fargo shares under pressure over the past few days after it revealed employees opened unauthorized accounts for clients to hit sale s targets. >> we know running a business that not everyone is going to do everything right every minute of every day. >> that's why you build compliance programs. that why you do training. that's why you do coaching. and unfortunately, 1,000, 1% of the 100,000 in a seat at any one time in the year, you know, they didn't get it right. >> all right. damaging to the bank's reputation? among other things. what do you do with the stock today? >> i think you buy it. stock has corrected almost 20%. it has the best financial metrics of any big bank out there. if you want to take a look at textbook in terms of how to handle something like this, you do it exactly like they're doing it. you don't hide, you meet it head
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on, they have gotten rid of the people that were involved. undoubtedly it is damaging. if you look at volkswagen, since the beginning of the year, it is apple, ford and gm. don't know when they go -- takes another leg down and there will be some reverberations throughout the customer base, but at the end of the day, it is the highest quality bank franchise out there, with the best metrics. if you want an opportunity, this is how you get the opportunity. >> you agree? >> i don't. i agree with everything except that this is the time to buy because this is the election season, this scandal is catniped to politicians. there is going to be another leg down when he has to appear in front of the senate and explain this. you'll get another opportunity. >> we said it last week, we're putting together another of those uits. we have to do it every quarter and rebalance for what will eventually be an etf as well. and we took out wells fargo before the news broke. luckily. and then we said, we're going with jamie dimon, we're going with jpm. and now it looks like you could be getting to a level where you
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could, you know, perhaps do a little horse trading there, but this is a portfolio we put together over months and years rather than just, you know, week to week. >> pete? you like wells? >> i tend to lean with jimmy on this one. i think the worst isn't completely over. but, you know, we never are going to buy the absolute bottom. i think there say little further to go, especially when you get in front of, you know, you start going through all the different hoops that they're going to have to jump through in the next couple of weeks, that will give us better opportunity to buy. >> what i caution, but it is going to be -- elizabeth warren won't just pick on wells, she'll pick on the whole sector. >> this is so finite, the way it was just described even by stumpf himself or whatever, so finite, a thousand versus the 100,000, all the rest of it. i don't know it permeates throughout the rest of the banking industry. >> i think you nibble at it here. and then you look to put a full position on. it is on sale. you can't find quality franchises on sale, we see time and time again, the wells
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scandal, buy it. >> something quick on disney? >> it is a quiet period now before earnings, before the next "star wars" comes out. i think it is going to bottom soon. it is a 92. i think it bottoms before 90. >> all right. good stuff, guys. thanks. thanks to all of you for watching. see you tomorrow. "power" starts now. it certainly does, scott, thank you very much. gentlemen, thank you. i'm tyler mathisen. welcome to "power lunch." delivering doom and gloom, we heard a lot of that coming out of this year's delivering alpha yesterday in new york city. but are things actually as bad, as ominous as some of the suggestions from yesterday? we're going to dig in on that. and too little too late, that's the message from one high profile banker sounding off on that wells fargo scandal. and dancing tim. we'll tell you why apple's tim cook, yes, he can shake it, has every reason to shake it like a maniac. "power lunch" starts right now. ♪ maniac on the floor

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