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tv   Closing Bell  CNBC  September 14, 2016 3:00pm-5:01pm EDT

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a one in five chance. >> one of my first bosses used to come out of her office and scream at people and flick her hand like this. there will be people who know. >> thanks for watching "power lunch." >> "closing bell" starts right now. hi, everybody, welcome to the "closing bell." >> we have a little bit of a breather in the markets. stocks not getting too much of a bounce after yesterday's oil selloff. apple leading the dell from the second straight day. samsung from that battery explosion. could t-mobile and sprint be the real winners? that's still coming up. >> that's the story sort of emerging right now, isn't it? money manager mark okada said
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active investing won't take a backseat to passive investing. he'll tell us why. netflix shares up nearly 2% today. let's start with apple's run-up today. bertha coombs keeping an eye on the rally. bertha? >> it's the first time we can say apple has been up three days in a row and up sharply on really strong volume, which suggests that people are buying here with conviction, first time in an awful long time. today's move putting apple at one of the highs of the year. right now it looks like maybe the highest going back almost to january. certainly a six-month high. and also it puts apple's market cap back above $600 billion after having lagged throughout the year with those really low expectations for iphone 7, those positive comments coming out notwithstanding the controversy over getting rid of the
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headphone jack really helping to move the stock. right now it's outperforming the overall market even when you start looking year to date. that's been the first time we can say that for apple in an awful long time. it's spreading to apple suppliers like skyworks and bro broadcom and t-mobile who says it has some pretty strong orders. back to you. >> nearly the fourth anniversary of when the stock first hit $100 a share. four years ago next week. >> so it hasn't gone anywhere. >> amazing. let's go to the medical deal. they buy a producer on santo at a $6 billion deal. bob is over at monsanto's trading post. >> 66 billion, that's the biggest foreign purchase ever by a german company.
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monsan monsanto's ceo said they are merging the best of both companies. >> it's a very strong deal for shareholders. as we look to the future, we think the combination of taking the monsanto bio technology seats and data science and combine that with chemistry, we unlock future renovation of growth that's desperately needed at the moment. i think it's great growth for today and needed for the future. >> what he said shs it, it's ab optimizing crop yields around the world. right now monsanto has 26% of the global seed market. baer only has 3%. a little more controversial was the price. guys, we were thinking it would be in the mid-30s. ultimately it's been a long negotiation. 128, a little lighter than some people expected.
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some comments about that. many big name investors meanwhile took the stage yesterday at the delivering alpha conference, and many were quick to sound the alarm on the global economy of these markets. >> i think there were tremendous ris risks, but i think any one of us could tell you it would go down tomorrow, next week, even next month or next year. it's sort of a guessing game. but you can look at the environment and i think it's very dangerous. in other words you're walking on a ledge and you might make it to the end, but hey, you fall off that ledge and you'll really see trouble. i think that could well be. what they have done is created a tremendous increase in hidden risk, risk that investors don't exactly know or have faced about their holdings. and i think it's a very dangerous time in the global economy and global financial
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markets. >> expect returns are lower. don't start levering up your portfolio and taking the same risks you used to. you just can't in this environment. in the future there will be more opportunities, but today is not the opportunity to take the same risk you've historically taken. >> let's talk about those risks, maybe some opportunities as well. we have steve grasso here from stewart frankel and our own rick f fratelli out of san francisco. maybe 3% pullback in the s&p like we've had may not necessarily seem like a great buying opportunity, but is it one, potentially, and maybe if you could lock in one of those dividend deals now that the sector has sold off. >> that's not one of our favorite places after going for the dividend yield. i could opine on that forever, but i'm not going to. i think you can't look at the
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market per se before you're going to buy a stock. i think if you look at your portfolio stock by stock and say, do i want to own this company for three to five years, do i think this company is going to be better in three to five years, and is this a price i can live with? that's what you should do on these down days, not necessarily look at the market and say, yeah, let's buy everything. >> you know, kim, one of the hidden risks, i wonder, does it actually lie in the dividend sector in these places that are so-called safe where so many people have been looking for yields? >> absolutely. i can't iterate this enough, that the people who are looking for yield and want to live off the income of their stocks which is, you know, one of the ways that you can invest, i don't think that's a great way to invest, especially at this point. those stocks have been overbought. you know, a lot of your guests talk about this. but it's true. the fundamentals are not there for the stocks that have risen
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the most like the consumer staples. are we buying less cereal today than last year? i think yeah. and yet those stocks have traded up terribly. and i'm not sure that the investors who have bought those stocks fully understand what they've gotten themselves into. so it's a danger. >> steve, talk about how this tape is now set up right here, at least in your view. the market has pulled back, like i said, 3%. a lot of people said, well, we kind of held levels, we kind of needed to hope the s&p 500. how are you doing it? >> the 24th, we'll call it, that was your old high and right now we're currently trading a little below that. 2120 is not only the moving day, 2120 is the lowest in the last couple days.
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i would think it's probably true. buying new utilities as these evaluation investors, but i don't see anything changing in the near term, especially next week when we get some clarity. what i do find, really quick, is that we've been looking at oil. we haven't traded off of oil in the last two days. we're trading off oil because we don't see the. so that's negative for the overall economy. >> that gets to the heart of it. japan is more important to the answer than a year ago, and bernanke said, hey, let's not rule out negative rates. which way is this thing going? >> thank you for that, that's just a wonderful thing to say. i tell you what. whatever the policymakers are trying to do in managing rates, eventually the opposite is going to be more aggressive by the
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satisfy nature that they can't trolley the beast forever. when i listened to all those people at the african concert yesterd yesterday. they weren't really talking about the necessary, though. they're talking about the. ment that's the only part of the parade that wasn't in the rain. now it's starting to drizzle there sochlt. they were created for all the jobs that weren't created that were good jobs. they're not really worried about the economic future. that was the bright spot. when we look at all this, i think it's much more simple. we had a bad fuse box in our
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house, and what did central banks do, what did our fed do? they started two neighborhoods away knocking down walls until they got to the right fuse box. that isn't the way it is. there is a lot of damage that's been done. and sears is starting to see it at the top of the pyramid. sales have been in there. people looking for much more upward mobility, they've been there. people who pay a lot of health care costs, they've been there. welcome to the club. >> rick, quickly, though, if harkts. >> where do yields go? where does the market think they can go at this point? >> where they go and where they stay is a lesson we should have learned in oil. i think there is nowhere for them to go except for the opposite way of the controllers, which means the up side. but ultimately they're not going to stay there.
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in the end, when we've reached this, we still need a global economy. >> i guess a lot of questions from our clients, and they'll say, i want to manage this litt little. that's telling you. so that difference between what sounds like a really great deal and what you can get as an. >> 7 to 7.5 spaers what pension funds in every city or more althoughty, that's their bogey.
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>> it's a crazy world. crazy. >> $23 billion if rates don't go up, sort of darned if they do and darned if they don't, but i always thought those frogs were pretty. they're pretty poisonous. poisoned dart frogs. that's the kind of market we're in here we have about 15 minutes to go into the close. you're watching the markets which have just tipped. nicer earlier in the session. >> apple can't do it all, i guess. up next, twitter announcing new ap apps. >> and wells fargo cn on our. you're watch cnbc. first business worldwide. get funky with your chicken.
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welcome back. samsung electronics are down more than 5% since late august. the mobile phone giant trying to
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contain fallout from the new galaxy 7 smartphones. because of those batteries, they are trying to update recalled phones that have not been returned. the battery will be returned to 6% to keep it from overheating. and they expect to have new batteries in september of 2017. twitter rising after the company announced three new streaming video apps. not for your phone, but for your tv or other boxes. julia boorstin here to break it down. hi, julia. >> it's a crucial part of its new focus on video, and it comes ahead the centerpiece of that strategy, streaming nfl games starting tomorrow. twitter announcing new apps for apple tv, fire tv and xbox one. it will stream nfl games regardless of whether they have a twitter account. but you won't be able to follow
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twitter accounts. the content that will be in the spotlight is twitter sports partners including nfl, nba, baseball plus videos from periscope and fine acts. twitter rose today in the hopes that it will jump-start revenue growth. twitter went down last year on persistent questions. his biggest change and biggest bet in the past year. guys? >> i'm just thinking about tomorrow night, right? that's when they're going to do the nfl game. it will be interesting, julia, to see how that exactly plays into all this. >> yes, i think they're trying to show off, look, if you're a member, you don't pay for it.
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they'll make it easy to plug it in and pop it up on your screen. the thing is, there are other places you can stream those shows. there's really going to be a distinguished, different experience for users and it's going to make it really worthwhile. we'll see how it plays out tomorrow night, but i'm sure they're hoping everything goes real smoothly. no need for glitches tomorrow. meanwhile, netflix also getting on more tv screens. how are they going about that? >> well, netflix and liberty global just today announced a big partnership. the company will integrate the netflix ab in more than 30 countries around the world. they both look to add subscribers. a similar deal was struck by comcast in july. they can in a case easier,
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making to subscribe people that we actually said we were going to partner, say they increasingly see some of the netflix's competitors being distribution partners. he warned that the sx-recorded. >> they're all jumping in the pool together. >> it seems like no matter what, they're going back to a central place to try to navigate this stuff, right? they're going some held made. about 40 minutes left before the bell. the dow just under 50 points right now. you see the s&p 500 still in the
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red. we've got someone who will start to say. also ahead, mia copus on last night and whether wells fargo can survive the biggest hacking scandal. ♪ mapping the oceans. where we explore. protecting biodiversity. everywhere we work. defeating malaria. improving energy efficiency. developing more clean burning
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breaking news. federal prosecutors are investigating wells fargo. also this involves the southern district of new york, also the northern district of california's u.s. attorney offices. the sources go on to say that the investigation is in the early stages and could lead to criminal inquiries. again, offices in california and new york for the u.s. attorney, those offices investigating wells fargo over those sales tactics that we've been talking about in the news over the past week or so. so interesting development here. i will also note that wells fargo has also drifted fractionally into negative territory. over half a percent still on heavy volume, guys. this one far from over. dom, thank you for now. there's the man we have to speak to about it. wells fargo ceo speaking about the fake accounts last night exclusively with john cramer, in case you missed it. >> didn't the buck stop with you on this?
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>> yes, of course, it stops with all of us, and especially me. i'm the leader. i get it. i said right off the bat, when we don't meet our goals of 100% right, i am accountable and i'm leading this company and leading it forward through this. >> have you gotten a call from warren buffett? warren would be very important. if i knew that he backed you, i would personally feel better telling people to own the stock. >> jim, again, i'm not going to talk about any conversation with any investors. i'm talking to a lot of constituents and working hard to get through this. >> it may mean some people saying you have to resign. >> i think the best thing i could do right now is lead this company. in fact, today we made actually an announcement about product sales goals. we never intended for product sales or any dynamic or any part of a performance management system to be misinterpreted. >> let's bring in jim cramer to
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talk more about this. jim, do you think investors heard what they needed to hear from john there, or what are the big questions that remain outstanding in your mind? >> i think, mike, that what you want to know is if your investor, is there going to be some sort of impact from the numbers. yesterday pipeer came out and said, look, this could cause rhett tail growth to stagnate. if the fed were to raise rates, you would want to own wells fargo and you wouldn't be thinking about this. at the same time, cross-selling had been one of the major reasons why people liked the stock, and if that is cut back, then i think people like it less. so we have to see what the impact is of the new rules they put through. >> you raised the issue, jim, of john himself who has led this bank for some time, and actually it's been one of the ones that stayed out of a lot of the spotlight in washington. what happens now that they are squarely in it? >> well, i think that there is a
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hearing next week, september 20, where i think the grilling will be similar to what we saw from some of the international banks. it's never pleasant. i think that one of the things that could really help the situation for mr. stopf is if the board decided there should be clawbacks. i think any senator would say, wait a minute, what are clawback provisions for other than this kind of behavior? >> jim, aside from the pure reputational risk here, of course, the stock of wells fargo shares have always had this premium built into it along with jp morgan and other guys. is that something that can be railroaded over time or can they have a fire break here? >> i think that's a totally legitimate concern. i think the price to earnings multiple has always been at a premium with we wills and a lot that is because they get more money from each customer. before this scandal, that was a
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good thing. now you say, wait a second, maybe they got too much money out of each customer. the idea is they're your full service banker. many people who bank only have one piece of business at a bank. they've been able to get lots of pieces of business, and if that does decline, if they are unable to get all that different business from a customer, halo will be tarnished, but the real worry is that you have to sell the stock. >> if anything his holdings have just continued to grow. >> he wants to make it bigger than 10%. you're not allowed more than 9.9 out of a bank. i would love to know if that application is going to be withdrawn, but obviously mr. stumpf would not go there. skid him several times. >> this question about who is responsible, you know, the ceo tried to make it sound like
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these were almost rogue employees responding to their own per versea judgments or something. people who only responded is to incentives, they said by the company, which makes you think many will fall down on the side of wells. >> i know when you say they're investigating, i want people to realize there are many different kinds of investment. mr. stumpf said to me, look, we've shared the people who have done the wrongdoing with authorities. it's not like i think they've hidden the wrongdoing with the authorities. an enterprising prosecutor can go after anybody. it's the people who led the real disasters in the 2008 period because those were easier to make sf. we may think that's going to
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happen, but a lot of people thought gfs to, as the bank points out, really not a tremendous amount of customer loss from a financial perspective, anyway. >> that's really important. there were some articles that said, look, 200 million were defrauded. there is no proof of that whatsoever. an investigative party did investigate and they found a little over 100 parties they had to rebate to. i'm not saying -- one customer you had to rebate to was bad, but it was a consistent operator. and i'm sure vuld to we don't know. there is always bad e-mails that can be. >> all these bags are gigantic,
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but you have all these patrols and a very strong word of directors, i think. who knows how much leverage you're using. if you're vus a plain, i don't think that's as. >> i'm going to let you go and get ready for the markets. it's not a reason to panic. just not a great environment. >> there's more to come in a couple hours. jim, thanks for joining us. time now for a cnbc news update. sue? >> president obama meeting with pyongyang's leader at the white house this morning. he said the u.s. is now prepared
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to lift sanctions against the asian nation which is one of the world's poorest countries as it continues to transition from military rule. two new york police officers were injured after they were hit by a car while standing outside a gas station. one officer suffered a head injury, another a broken leg. the third received mild head injuries after an arrest with a driver who was arrested. starting today a fleet of self-driving cars. this one has me puzzled. a chipotle customer whofls sickened in the e. coli outbreak last year asked for some free burritos as part of her legal settlement with the fast food chain. the company agreed and sent her a couple dozen coupons for free burritos. the woman's medical bills from the infection totaled $40,000. >> this is like a seinfeld,
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right? wasn't there a seinfeld where he was burned and got free coffee for life or something like that? >> i got to tell you, more power to her. act of faith, i guess. >> $40,000 is a lot. >> a fundamentally good sign for chipotle. less than a half hour left, the market continues to slouch a bit lower. you've got the dow down by almost 60 points right now. a leading trader is going to tell us what he's watching coming into the close, up next. highland capital said investors could be missing out big time. mark okada making the case. stay with us your finances, your future.
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. less than a half hour for trading. we're looking at some stocks with mark okada. everyone is watching the bond market right now. what's your take? >> i think the answer is no. you have seen some yields getting over 163, but if you look at the broad trend, it's
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still very much on the down side. it's almost 2% to the bottom. you have this move where both stocks and bonds have sold off in unison. the expectations are only about 20% for a hike. so there's all this argument for why the feds should raise, but if that doesn't happen, i think the lows are still probably not in for treasury. over the next 18 months, it's going to be tough to see a breakout, which bottom line, the move today we're seeing utilities probably can move a little bit higher as yields come down. all those things paint sort of a grim picture for yields and/or growth expectations as well. >> if we get up to 2%, though, which would still be in this down trend, doou you think the overall stock market would be okay? >> the one thing would be the financials, but aside from that -- a lot of it is how quickly the market moves up.
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technically yields down and stocks are still in good shape despite being in a short-term down trend. >> we'll be watching the fed next week, mark. thanks very much. appreciate it. yesterday at the sixth annual cnbc institutional investor delivering at the alpha conference, one panel in particular focused on what happened to alpha. listen to what was said about active investing. >> you just need to go with certain time periods where you work through these issues, and eventually the strong survive. by the way, it's not a bad time to have a weeding out of people who are not the best stock pickers involved. >> this massive move to indexing from a trading point of view has changed the way stocks trade. so last year one of the things that we saw, stocks sliced through where we thought they would stop on the way down, and they sliced through where we thought they would top out on the way up. it was very rapid, and it was of a magnitude that one wouldn't
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expect other than in a real crisis, and we weren't in a crisis. everybody has to adjust to that. >> highland management mark okada is here to tell us why past investors are missing out. are you going to say it's past communism? >> no, i don't want to make remarks like that, but if you look at the trends that have happened over time, it really concerns you. it happens in the context of things, and i see a lot of capitalists flowing out of active management, out of alternatives into passive, and it's worked. you can't argue that in the last several years it's worked, but i think we're entering into a period where it's absolutely not going to work, and i think there are a lot of opportunities that investors are going to miss because of that, and i think that's an important thing for the folks at home to understand. >> i guess the question is, is this really a phase or a cycle,
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or is this an extremely long-term trend? you can go back 30 years and say, well, indexing has been gaining for that period of time as opposed to just kind of waxing and waning. so what tells you that maybe soon something is going to come along that's going to challenge the passive stuff? >> take advantage of -- just look at what's happened in the last several days. we've had both the bond market and the he cequity market traden at the same time. those are not normal occurrences. that's not the way markets are supposed to react. i think a lot of this indexing and the performances that's tied to them is tied to normalization of markets, of interest rates coming down, then normalized. i think we are at a point where interest rates will normalize somewhere in a different zone than we are today. that could be negative. it could be up from here, but there is an inflection that's happening in capital markets.
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i think it does create more opportunity for active investment. i think there are many liquidity changes that have happened in the marketplace that have been difficult to manage but also create a lot of opportunities. >> so let me ask you, what are your fees for -- if i give you my money, what are you going to charge me? >> it's anywhere from very little in a big separate account, let's say you're a big pension funder, but i would say my statement on fees -- fees are a big focus because performance has been high. but fees, really, to the extent they're done right, they're aligned with investors. you have some sort of performance dynamic. i agree that if the beta or the return for markets is lower, then fees should be lower, management fees per se, but there needs to be a better alignment and you get that alignment within the most actively managed products. so i think the fee discussion will quickly go away once this what i'm talking about, meaning active management, really doing good things for people's
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portfolios. >> are there particular distortions within the market that you can point to that's being caused by this rush to indexing that you feel can be taken advantage of? >> well, for example, if you take a look at what's happened in treasuries the last several days, if you look at a data of how much secondary activity happens in the treasury market, the ig corporate market, the high yield bond market versus where it was 10 years ago, we're down 60, 70% as far as daily trading activity. the finer point is that we don't have markets that are actively trading in and out versus the scale and size of markets. a lot of that is due to indexing or these funds that have gotten really big and they're gathering assets and just sit there. they're not trading a lot. when you have an actively functioning capital market or secondary market, then you get good price discovery. when you have something like this that's very liquid, you get
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price recovery that's way off the mark. the point about what the managers do, you can look this summer and see the meltup of equities and bonds. >> it's not to say there is not a place for active investing, how many of a percentage playing basketball make it to the nba? in other words, there aren't people who can't skillfully do it, there are probably a small portion of people who are really doing it right. >> i guess i'm going to push back a little. i think there has been a period where the monetary policy has pushed up both bonds and stocks for a long time. i think that's coming to an end. i think this is a period where active management in general will do better. we're having a great year, right? we had a tough year last year. we're having a great year. i think that will be something that will be more of a story going forward.
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>> mark, thank you so much for joining us. defending the industry, mark okada from highland capital management. >> thanks, mark. we have 18 minutes until the closing bell. we gave up a bounce in the morning. up next we'll take a look at the forecast for the rest of the year in the ipo market. the wireless wars. if you think at&t and verizon have been declared the winners, think again. a new report is saying watch out for the other guys and that's coming up on cnbc first business worldwide.
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we're seeing heavy volume in apple as we approach the close. so far more than 280 million shares have changed hands. just to put that into perspective, the last time apple traded 280 million shares was back in april of 2007. the stock also having the biggest impact on the nasdaq 100, currently up 3.5%. the ipo market is relatively slow so far this year, anyway, but that could all change after the election. that's when our next guest says we'll have a more stable view of the market which could create an
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opportunity for these unicorns to begin the listing process to go public next year. >> jackie is our ipos leader and she joins us right now. so jackie, the founders are saying this is my one shot, i want everything to be right. they're actually going to wait until after next month? >> the election is definitely putting a damper on things. they have all year, but you look at the brexit issues, everyone is lining up for 2017. >> next year aren't we going to be worrying about something else? >> you never know what's going to come up, but definitely 2017 is looking to be much more stable from a markets perspective. we haven't had as many ipos this year. we're about 15% down from last year. last year was decent, about 200 ipos but we want to get back up to those levels. >> the companies, what's their incentive? are they on a timeline in terms
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of options they've given to korean investors? is it sort of a desired thing? >> i wouldn't say there will be a big boom among unicorns but i think we will see unicorns come out. it's not so much i need to raise capital. there is a lot of capital out there. it's a credibility. it's attracting and retaining talent. a lot of great things come from obtaining a company. >> do they have that path toward being profitable before they go? >> absolutelimeyabsolutely. a number of key factors is you have to have the right team around you, the right management team, the right board. the second thing is making sure you're surrounded by a great group of advisers, et cetera. those add a lot of credibility to ipos. and thirdly, you have to have toppling growth and you have to have profitability. >> where does that leave uber? >> these are long-term paths.
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many companies that are in this unicorn space are working through the financial side of this. they're building businesses, they're taking risks, and you want to do that it as a private company. >> i think we have picky investors, but i think somehow uber will get a close look, so we'll see. kathy, thank you so much. >> thank you. we have a little more than 10 minutes to go here. we started up the procession nearly 100 points higher today so a lot of speculation. the nasdaq is still positive. be careful now. there is an angry clown under the bed. our next guy says don't bother to look. chris heise will tell you what to do about it, next. money for programs like education will shrink. in just 8 years, interest on the debt will be our third largest federal program. bad news for small businesses.
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the good news? there's still time for a solution. ask the candidates for a plan to secure our future.
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can. welcome back. the dow is still down while the nasdaq is up for the second day in a row. we'll talk to chris heise of bank of america here. you say there is an angry clown
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under our bed. >> i particularly don't like clowns, but this angry clown is coming back as a hiccup, and then you get all this portfolio repositioning going on just equalizing risks in all assets, and you get this tantrum, this little flush, and people come out and say, what's wrong fundamentally. that angry clown every once in a while puts a head out there, and the question is, is it going to come up in full body form? we don't think so right now, but certainly the next couple years, that full-body clown will start to come up for a variety of reasons. >> let me ask, is part of what you just said risk parody? we heard a lot about that yesterday. investors are concerned if stock and bond prices keep falling, there will befa fallout for suc strategy. why? >> is it going to be stumbling in nature? we don't think so.
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volatility is episodic. it's not constant in this particular regime. the business cycle is going to continue to move forward. when you get a risk parody rebalancing, it really means you're going to redo equities, oil, commodities in general, which to me is the most troubling part. we won't get a necessarily yield backup just because all of a sudden we're going into a link cycle. it happens more or less because of a repositioning and the good thing is it steepens the curve which should help out the financials. >> as we get one of these shakeouts, chris, are the fundamentals okay? right now there is a question. >> what was august weak data? it was probably inventory liquidation. now you get a buildup again, and you get an extension in p mrkmid manufacturing. it was very rainy and very hot in august. we think you'll see the
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improvement factor take over again late third into the fourth quarter and you'll start to see those numbers come through. >> we got it, chris. thanks. when we come back, we have the closing countdown, next. then after the bell, she was once seen as america's party girl. paris hilton has moved on from red carpet and tv and she's taken on investments. she visits "closing bell" coming up. you're watching business worldwide.
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crude oil spilled again today. we gave up a morning bounce, but then no real fireworks after that. >> i think it's intriguing that this is the flattest day we've seen in a while, so not a lot of volatility overnight in stocks, bonds or the dollar. i still think the market is very much on edge. i don't care what anyone says, 15% chance of a rate hike. there are a lot of people who don't believe that. there are a lot of people who somehow feel something could potentially happen. let's face it, a lot of people are off sides on this. two long stocks, two long bonds. the feds have said for a long time, own stocks, own bonds. and if they're changing their minds, people need to protect
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themselves. >> there's definitely anxiety leading into the meeting next week because the long end of the market is selling offer even without expectations of the fed moving. so it's kind of like exactly what is going on. >> we're seeing a steepening of the yield curve, which is certainly good. certainly good for the banks, although when we saw that steepening yesterday in the t ten-year, banks didn't particularly move. i think they just think potentially it could happen. we have surprising ipo pricing tonight. noble midstream, which is an oil and gas mlp, they tried going public in september. oil was terrible then. suddenly now oil is stabilized. they have a yield that's 7.5%. the book closed early. demand is very strong. i wouldn't be surprised if price
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is at the high end of the range. this will be a test for the ipos with a test score of oil and gas overall. >> thanks very much. bring in the closing bell. from the nasdaq from the company of economic development, and the national association of investment trust. all yours. welcome to the "closing bell," everybody, i'm kelly evans. the s&p dropping just about a point, but the nasdaq managing to stay positive today, as a matter of fact, averaging 18 points. closing at 51.73. for the s&p, 21.25 is the closing level there. for the dow, still hanging onto that 18,000 number. 18,034, a drop of about a fifth of a percent today.
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and there's one luxe lady who is making bank. paris hilton gives us her take on traveling the world, her successful business empire, and yes, donald trump. and that's coming up. joining the panel in the meantime, back with us for the hour, cnbc's markets along with taoshi. welcome one and all, mike. what are your thoughts on this market? a very sort of odd trading activity. >> it was. we had 3.1% moves in a row. 4 is unusual so not surprising to see the market drift a little today. it seems shaken up with this 3% drop but not overly so. people are not willing to say this is a great buying opportunity just yet. oil didn't help out. i do think it's interesting, though, when treasury yields calm down, equity kaucalms down little bit, so maybe that will be the pattern. >> the financials are all caught
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in this crossfire about which way are the rates going. >> it was always interesting to see rates in there because they're so different from your traditional financial, so to have them separate from that, i think, will be helpful for investors. the financials are a tricky one right now, because even if you think rates are going higher, there is now some suspicion that the feds will have to do something a little more creative, like perhaps cutting what they continue paying banks to hold deposits at the fed, that maybe they'll have to pull some other levers that will not be positive for the banks and it's not going to be all a net benefit for them. wells fargo is hurting in the meantime. >> separate from the whole issue, jeff. so glad you're here today. >> thanks. >> the apple issue was about the price of stocks and bonds falling together. you're leaning against that grain, and you still think that bond prices could keep rising and that yields could keep falling and all these yielding parts of the market could keep
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doing well. >> yieldy parts, yeah. i think what you're seeing in bonds and in the bond circuits is what i like to call them, is just a reaction from the brexit. brexit sort of forced the issue. it put the downside spike in the yields, it had everybody scrambling to get some type of yield circuit. we found out it wasn't the end of the world and we're three months past that. now these bonds are actually oversold, the trends are still in very, very good shape. i just think it's a reaction function around that. you note if you look at the probability of where fed funds would be at the end of december, it was about 10% that they be 50 basis points or higher during brexit. now it's about 50-50. you just have this natural progression. >> we had a guest last hour who compared some of these dividend parts of the market to frogs because it might look like you're getting such a good return but in reality the risks
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are so deep. fundamentally, why are all these parts of marketing a good investment here? >> it depends how you want to look at it, right, and certainly from our standpoint it's more tactical than anything. if it's five years out, i have no idea. if it's in the next six to eight months, i have more confidence in that. if you compare historically to the 10-year yield, you still have a gap that can be filled just to get you back to the highs of where they've been the last 50 kbreeyears. it depends how you want to measure the yield of those seeking the income, just to get back to the parody of an income yield. >> given the valuation levels that some are trading at, this is an example of how they're trading. >> looking at cyclical stocks such as american airlines, i do think it's interesting that it
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highlights this real split in attitudes among people who say, look, there is going to be a base name for them in the file rkt and you want to pay for the broken part? we got to 1, 3, 5, thereabouts, is this what we saw prior to that? >> in terms of the bond yields, yes. it was all in context of the longer down trend, right? you didn't have the taper tantrum, and that was the bigger spike in yields. we also didn't have anything like that. what's different this time it had a bigger impact. those have had more compression than what we saw during 2012. >> just to go back to this point again about this whole environment, ben bernanke comes out with a blog post today saying don't rule out negative rates.
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i don't know if he feels like the discussion has moved too far away into this world of the feds raising rates and yields just generally moving up and wants to kind of lean against that, but it's no wonder it kind of makes people go, wait a minute. >> the thought was that because janet yellen didn't overtly mention rates as a tool that could be used, we thought it was off the table. ben bernanke, of course, not in public service anymore, but just the fact he would be raising the question is important. jeff, i'm concerned that this is just an alteration of what we've seen all quarter or if we're starting to see a bifurcation. >> yellow's apple driver hitting a 9-month high, the damage has
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been in the yield sectors in those areas more of an extension in the bottom market. a company you're buying in the next 10 years of growth as opposed to a bird in the hand dividend. apple finished the day at 4%, all in the wake of the iphone 7. let's bring in walter pasek. we're kind of left to pick over what the carriers are saying. what are your conclusions? >> it's the first year we didn't get the free order numbers after the weekend. people thought maybe apple was trying to hide what was going to be a disappointing phone, and john ledger from t-mobile says, our phone was up four times. then earlier today, both at&t and verizon commented. verizon kind of pulled back and
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said it's kind of business as usual, but at&t spoke up and said, hey, this is different. and we were going to follow quarters where the up cycle was down. people were holding onto their phones longer. this is a true data point we've seen in a while where the customer can always sell. if sprint and t-mobile are the smaller companies experiencing growth at the expense of verizon, for example, that's a less positive story for apple, right? >> that's true, and had at&t and verizon come out today and said, our numbers are down, i would be more concerned with that as an apple investor. but if at&t said they're up -- even if verizon is giving shares to t-mobile and sprint, you're talking four times as far as the growth and order of.
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that's a useful number. that's tell you that in the u.s. and general. that bodes well for apple being able to execute growth which a lot of people don't believe they can do in this third quarter. >> apple is offering its. >> they would they would be re-upping phones every single year for people who want to trade them in. who does that hurt and who does that favor? >> i think it was initially perceived a threat to the apple operators where apple is trying to grab that friendship. however, now they're throwing subsidies back into the phone, so if you're a customer of the united states, it makes more
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sense to choose from apple. it may be an opportunity for them in china, because of the necessi necessity. a very small percentage, probably less than 6 or 7% of phones are actually -- it might have been an attempt for apple to gain some additional accessories, maybe verizon is trying to fend off t-mobile and sprint a little more, probably not going. >> what do you think about this in terms of general sales volumes? where is the bar now? >> i think. >> you're still looking at a
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multiple of a community which s is. people were kind of relieved that we were find a. there is a lot of interest in what they're changing on the screen. . as a place of revenue, you have a concerned look at some of this future growth. >> have you tried the headphones, the earbuds? >> i did try the headphones. i get tired of holding. . i'm sure my will stake them, anyway, before i even open the
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box. >> correction. "airbud" is the movie with the golden retriever who plays basketball. "airpod" is the headphone. >> that is one of the few films about a wonderful set of air bu buds. >> tell us more just before you go. >> tech makes a lot of sense. one of the reasons tech makes sense is you look at the. no correlation to the anticipation of federal rates. for staples, for utilities, for reets, it's negative .5.6. for texts on the milgd for those who don't want to joining.
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z . >> we discuss that as well as how higher gas prices are impact by higher rates. they pre-ordered those huge numbers for i7. you're watching cnbc, first in business worldwide.
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my next guest just rang the closing bell here about a real estate investor. the change is effective after the market closes on friday and yesterday star capital ceo discussed it. >> it really roaring ahead and people aren't paying attention to it as a residential sector. which has been a part of every recovery in history and has not participated in this recovery. the residential markets are really good. from apartments, the best apartment market i've ever seen in my life. there's too many apartments coming on line.
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san francisco is getting overbuilt. our assets are in seattle, in denver. it's a amazing. >> here to talk about how the community markets are doing is owen thomas, the owner of business property. welcome. >> thank you. >> is there a bubble in commercial real estate, and is the timing of this new sector one of these skyscraping moments we're going to look back on? >> today was a battle day for the real estate industry. reets last year were $9 billion, today it's a $25 billion industry. also, reits aren't financials. they've been disconnected from financials.
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reits have been up 9%, financials have been down 2%. >> i guess that's my point, isn't this a moment where having had great gains, now getting your own sector and this fresh capital coming in, does that worry you that there's too much capital coming into a sector that already has a lot of high value interest? >> there is a lot of capital in all asset classes, even where interest rates are. fundamentally our stock is driven by fixed income components because reits is a higher dividend yield than the overall market. there is clearly a fixed income element, but fundamentally we're in he can with equity. we own buildings. our success, our income growth is going to be driven by the performance of the economy. if the economy goes up, there's more people shopping, more people working, more demand for office space. right now we're not having a
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strong recovery, but we're having a stable and consistent recovery, and generally we're finding our buildings are staying relatively full, we can push rents and that's going to be rehevery helpful for real es valuations. >> we've taken cues from the fact they've been sellers of property, of loan portfolios and equity in holdings. you're on the other side of the deal from them. i would say it takes two companies to make a mark, but what do you think you know that they don't know? >> blackstone is a leading investor and we have a terrific ree relationship with them. blackstone is selling investments but they're also making capital. our building is the colorado center and it's a major 2 million foot space in l.a. we wanted to be in the market prior to making the acquisition,
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which was important. second, the building was not fully let. the building was 60% leased. what we've been doing is leasing up the building, and we think as we lease it, that will increase cash flows and create value for our shareholders. >> when reits were created back in the 70s, i guess, the idea was we had to encourage public capital to get into the real estate market as an asset class. is that something that's necessary? is this conduit a key component of bringing money into the real estate sector? >> this change that happened today? >> not just today, but the whole structure. >> i think both of them exist and they have an important role to play in the commercial real estate industry. as i mentioned earlier, reits have grown tremendously. it's nearly a trillion dollar asset. one of the reasons it's grown so much is it's been so successful. the return performance from the industry has been very strong, it's been well supported. there are many companies who are members of the s&p 500.
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there is a tremendous amount of transparen transparency, and there are certain investors who want to express their desire to invest in real estate in a public format but they're still a big part of the market and want to invest privately. that part of the market is not going to go away. >> i also wondered if there are any products you backed away from because you thought they were too speculative or the markets were too low for what you have to put up. >> you mentioned the building that we bought. we actually have -- the growth from our company comes through a new development. for example, we're building the sales force tower in san francisco which is going to be the tallest building in san francisco, it's a million 4 square feet. we're going to be delivering that next year and we're very excited about it. but to your question, our desire to start new developments today, we have a higher requirement to do so. we want more significant pre-leading, we want to have a less risky investment start. >> understandable. congratulations again on ringing the bell.
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the first s&p sector since 1989. what is going to be the next new one? >> thanks so much for joining us, owen. well, sprint and t-mobile speaking of the telecon, seeing huge rises for apple. entrepreneur paris hilton stopped by the new stock exchange. find out what she's working on now and what her big money mistake has been later on "the closing bell." david stockman says trump will be horrible for the markets. what does he mean by that? he will tell the fast money crew coming up at 5:00 p.m. stay tuned.
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and invesco believes doing that today requires the art and expertise of high-conviction investing. ♪ translation? why invest in average? welcome back. will a pull out of ohio give hillary clinton something to worry about? john? >> i want to talk about what we know and what we don't know about the polling, both in ohio and across the country. first of all, it's very clear that hillary clinton leads the race for president, but also that donald trump is running much more closely than he was just a couple of weeks ago. so let's take ohio. we had a new poll out this morning from bloomberg news that showed donald trump ahead by
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five percentage points in ohio. cnn reported the same thing. that's different than the poll that was released a few days ago from cbs and ugov which showed hillary clinton up by a few points. what's the dimfference in those polls? the bloomberg poll showed the electorate in ohio at 70% elective than republicans over democrats. the democrats had an edge in 2012 in the ohio ielectorate. in a two-way race between donald trump and hillary clinton, hillary clinton is ahead by five percentage points. that's a healthy national lead. anybody who wins by five points is going to win in theie electoral college. but if you add the third party candidates to the question, that's gary johnson the libertarian, jill stein the
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green party candidate, hillary clinton's lead is down to two points over donald trump. where is gary johnson and jill stein going to end up this fall? the history of third party candidates has been that their numbers get smaller as we get closer to the election. in that case the two-person race would be the more appropriate one, but we don't know if that's the case this time. a lot of dissatisfaction with these two nominees. so one uncertainty is going to be what do the third-party candidates ultimately show up, and it looks like gary johnson will not qualify for that first debate on september 26. and secondly, what is the party balance in the electorate overall nationally? 2004, it was dead even. in 2012, it was plus 6 democrats, 60% more democrats than republicans. that is an uncertainty we'll all be watching over the next two months, guys. >> these are not just polls out of wall street, they're analysts out of singapore and hong kong and london. it's hard to draw a straight
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line, but they are influencing in some way the market. >> this morning when that bloomberg poll that john talked about was released, it was kind of blamed for a dump in the pace oe. the mexican peso is trading tick for tick with the election. >> you could speculate should trump become president, how do you walk from here to there, is it just the impact of the strong dollar and how much is the strong dollar an impact of that as well? there is also new numbers from the census bureau and this goes back to president obama. his relatively high approval ratings, mike, and that should be a cushion for the incumbent even though he's been in office. >> maybe that is the explanation for obama's high approval rates, it's just a question of whether that at all translates into the clinton camp. >> there is evidence that the approval of the incumbent president, the outgoing incumbent president, is very
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influential. barack obama is over 50%, as high as 58 in a recent post-abc poll, 51% and some other polls and the average of all the polls. the vast majority of his approv approvers, people who say he does a good job, is hillary clinton. we'll see where his numbers are a month from now, but there is no reason in particular to think it's going to drop. >> john, thank you for now. john harwood in washington for us. josh lipton, what's happening? >> kelly, some news here on ios 10, apple's new operating system. some data from a mixed panel saying that operating system is actually seeing faster adoption than ios 9. so in the first 24 hours, it was installed on 14.5% of devices. you compare that, mixed panel says, to ios 9, and in the first
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24 hours, it was installed on about 12.6% of devices, so slightly outpacing ios 9 there. i know patrick moorehead, i was talking to him, and he said that's a pretty good indicator of general excitement for this new ios. that includes revampment of messages. investors are waiting for that new hardware. that ios 7 will be available on friday. >> i had to confess i didn't even know what an upgrade it was until i was reading the reviews today. this messaging may be a little bit different. i might do it tonight. >> i don't have enough room on my phone to do it. i'll have to delete some stuff to be able to get it. >> i know that was freezing phones and that was an issue. i know it can take your photos and synthesize them and take stuff out, but it takes a while. i'll report back. time now for cnbc news
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update. >> here's what's happening at this hour. the united states and israel have signed a new aid deal that will give the military $388 billion in 10 years. the current deal expires in 2018. it averages $38 billion a year. donald trump toured flint's water streetreatment plant, bu. chief justice rob are the swore in carla hayden. she was nominated by president obama and confirmed by the senate. and call it the bark at the park. the chicago white sox set a new attendance record in their game against the cleveland indians last night. more than 1100 dogs showed up at
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the game with their owners, of course. the promotion was recognized by the guinness book of world records. >> no cats. cats next time. >> i'm biting my tongue. >> cats next time. >> fur would be flying. >> maybe no hot dogs, either. >> thank you, sue. >> you're welcome. >> see you later. sue herera. it's been said the rich get richer, but maybe not so much these days. two luxuries have been making warnings. paris hilton. the reality tv star has several business deals keeping her plenty busy, but is her life still simple? that's straight ahead. okay... what if a million people download the new app? we're good. five million? good. we scale on demand. hybrid infrastructure, boom.
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together, we're building a better california. global uncertainty. those are the concerning words emanating from the world of luxury. robert is tracking it for us and has the details. >> two companies both issuing warnings yesterday about the luxury competent. richemont which owns cartier,
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dunhill and other big brands said there was a downturn in the year. chairman johann rupert says they will continue to reduce staff and close stores around the world. richemont's big problem right now are watches. the corruption in china hurt sales. swiss watch sales in china are down 11% for the year. switch watches down 40% year to date. they are destroying them or actually moving them to other markets to prop up sales, but the spending recession at the top is also hitting jewelry, clothing, handbags, lots of other categories. hermes, which is considered the leader in luxury, reported strong profits yesterday and that's driven by leather goods like its $15,000 burken bags.
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ceo axel dumas saying they're hanging in there. paris hilton to talk about her latest business ventures including her new perfume. she has come a long way since her days on the simple life reality show. >> i like being a businesswoman. i feel like it runs in my blood. i love being a businesswoman, i love being creative and i'm so proud of the empire i've built. >> you say you spend 380 days a year on a plane? >> i do. i practically live on an airplane. i'm in a different country every single week. >> what motivates that. you don't have to do that, you know? >> i love tit, i really do. i could do nothing and just live with my family, but i wouldn't be happy. i love make mig famiing my fami
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and making something of myself. >> you've certainly gone well beyond those days of your own brand. has the brand evolved and do your customers evolve, then, as well? >> it's definitely evolved. "the simple life" was a character i was playing, but i'm now a very established businesswoman. i think i've proven myself with my track record, and i'm going to continue evolving the brand and expanding it all around the world, and it's very exciting. now i'm getting into the tech world and have some very is exciting projects coming out in that area as well. >> okay, let me stop tand ask yu a couple questions. iphone or android? >> iphone. >> do you have one of those, the amazon black box thing? >> alexa? or echo. >> echo. >> no, i don't have that. i love anything to do with gadgets, yes. >> back to fragrances. i'm going to sound like a guy,
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but this is your 20th fragrance. gold rush is the name of t right? >> uh-huh. >> how do you distinguish one fragrance from another, necessarily? >> being in this biusiness for over a decade now, i'm an expert in the fragrance world. i have gold rush for men that is coming out next month. i'm going to send it over to you and auroyou're going to love it. >> is it in the shape of bill griffeth? >> i want it to be about you. >> do you think about getting more specifically involved in the family hotel business? >> i'm opening my second property in the philippines and we're developing more right now in dubai. i've been doing it in las vegas and new york as well. it's going to be boutique hotels under my name, just paris. >> it strikes me that you have a lot in common with ivanka trump, whose name was enough on its own to bounce off, she's also done so much. you know ivanka, you guys are
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friends or have been friends, whatever. what have you thought as you've watched her father running for president and the spotlight that's put on her and the way that she's handled that? >> i've known her since i was a little girl. i really respect her. i think she is really a businesswoman and she handles it very well. she grew up in this as well, in new york with her father. i admire her. i think she's a beautiful woman. she has an amazing family and i'm really happy for her. >> and your parents have been best friends with the trumps for years. what do you know about donald trump that the public doesn't know as he runs for president here? >> i've known him since i was a little girl. he's a very nice man. i think on tv people like to say things about certain people, but he's actually a very sweet person. i like him a lot. >> would you vote for him? >> my mom always told me not to talk about money or politics, but -- >> let me ask you one question in that vein. we often like to ask our celebrity guests or successful people as they come through
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here, what has been one of your biggest money mistakes that you've made, maybe, that you've learned from? >> i've actually been very smart. since a young age, my parents have really instilled a hard work ethic in me. they never spoiled us and i'm very grateful for that because i don't think that i would be the woman that i am today if my parents didn't instill that in me. i've been very lucky in that way. >> but even richard branson will say the best teacher for a successful businessperson is failure. it's not what happens to you, it's how you respond to what happens to you. are you saying you've never had a failure in money? >> i've actually been very lucky. i'm very lucky in business. i have learned from the best people in the business, so not yet. >> we finally met a celeb that never had a bad money mistake. >> paris hilton who also made the rounds here for quite some time taking photographs and talking with the guys on the floor of the new york stock exchange. $2.5 billion she's done in perfume sales. >> it's an eye-opening fact
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about the perfume industry in general, don't you think? it's just amazing. >> where is her biggest following? she spends 300 days a year on a plane. where is she spending most of her time and who outside the u.s. is really behind the paris hilton brand? >> apparently the brand is huge worldwide. that's what she said when bill asked her where those numbers are coming from, but she spends a lot of time right now in ibeza where she's doing a deejay stint that keeps getting continued because it's so popular. >> does she fly commercial? >> i think so. we'll have to have her back and ask. uber self-driving vehicles. we have details about this pilot program and whether it could soon be coming to a city near you, right after this. and the launch crew met for a moment of reflection. before any of this,
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welcome back with breaking news about hillary clinton. what's happening? >> we have news from the clinton campaign in terms of hillary clinton's health. they say they'll be putting out a detailed account of her health but they've released some bullet points now. they say in terms of her pneumonia diagnosis last friday, hillary clinton had a non-contrast chest ct scan that was performed last friday. the results revealed a small right middle lobe pneumonia. they also say this was a mild, non-contagious bacterial pneumonia. they say secretary clinton was
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treated with levaquin which she was advised to take for 10 days. she had a normal breast ultrasound and hillary clinton remains fit to serve for the united states. we'll have that letter as soon as they put that out as well. >> there's been a lot of talk the last several days about this mccain standard for presidential candidates, for maybe taking a small group of reporters or an expert, opening up your medical records and having a look. any sign that we're going through something like that here? >> it deoesn't feel like that. both candidates have been hesitant to put out blank statements about their medical records. the question is, with the age we have of the candidates this year, is that a wise choice for american voters who want to know
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about the health of these two candidates? i think if anything it points more to the vice president. if the president elect were to have any kind of health issue, voters want to look at the vice presidential choice as well, and that choice is out there as well for voters to make a determination. >> it's also about transparency, and i guess that's the issue a lot of reporters had when this happened on sunday which was, why don't you tell us either when you get the pneumonia diagnosis in the first place or tell us when something like this happens why thafere's been an incident. >> right, limited history given out over the weekend. it wasn't until hillary clinton's wobbly moment at the 9/11 ceremony on sunday that the clinton campaign finally said, yes, she's been diagnosed with pneumonia. after that they gave different g accounts of her health. since the pneumonia diagnosis, the trump campaign, donald trump
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himself, has been very hands off in terms of hillary clinton's health. donald trump has said, you know what, i don't want to get into that. i wish her well and hope she can get back on the campaign trail. so a different tactic here than you might expect from the trump campaign which may be thinking that this story is playing out on its own and we better just leave it alone for now. >> we'll see what we find out from donald trump when he visits dr. oz tomorrow. uber drivers, the drivers are so yesterday because the ride-sharing service that got started with drivers sharing the cars are now moving into the autonomous driver sharing rides. we'll go to pittsburgh for a report, next. you both have a
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if you're an uber driver, your ratings may soon be no longer or no longer matter in pittsburgh, yay. uber is launching a priority pramt of self-driving programs in that city and phil lebeau tried it out. >> this is really the beginning -- not really even the beginning, it's the latest in the race between a number of companies, including uber, when it comes to turning ride-sharing into autonomous drive ride sharing. look at all the companies that are now putting in efforts, putting in programs that are focused on taking ride-share operations and working towards stripping out the driver. you've got uber, we'll talk about that. the chinese company working with invidia, gm and lyft and then ford by 2021. by the way, that's me, taking my hands off the wheel of the uber vehicle in pittsburgh. what is uber doing in steel town? they've got a handful of ford fusions with 20 cameras and
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lasers on them. they've outfigtted them, diving rides to people for free who say, sure, i'll take a self-driving vehicle. keep in mind, this is a pilot program, a little early to expect them to expand it nationwide. >> i just took an uber and they were asking me if i would take one. and i said no. >> i would give it a shot. you know what i mean? it would be interesting. >> i would like to be in charge of a vehicle that i'm in, if i'm driving it or if i'm a passenger. i want to make sure that the person who is driving it is paying attention to the road. >> overall, the reactions were split in terms of how people would feel about getting into a driverless uber. but again, kelly, there will be an uber engineer in the front seat, along with a test driver at least for the first several months and eventually may go down to one uber employee in the front seat. we're a long way from seeing a car pull up and there is nobody in it and you get in and that's your uber ride. some day we may be there, but
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that's not coming any time soon. >> that's the funny part of this, kayla. for right now, there's actually more people in the uber car and not less, which is their long-term goal. >> i think you would rather have that. we see cars being tested in big open parking lots where no one can get hurt. pittsburgh is so challenging. we asked the mayor on "squawk alley." he says it's hilly, they are four seasons and it's wind erodes laid out in the 1900s. but i wouldn't think that would be the perfect terrain to be testing something like this. >> and kelly, while we were in the car, we saw two trucks cut us off and the car had to react quickly, and it did react quickly. it's called a pittsburgh left. apparently, this is the way they do it in pittsburgh. you don't wait during the green light to turn left for the oncoming traffic like we do in most cities. nope, you want to go, you go. they call it the pittsburgh left and it's created challenges for uber in that city. i experienced it firsthand, both times. the car stopped ahead of the
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vehicle turning in front of us. so they're getting some challenging routes, no doubt about that. >> i had a little experience in one of the self-driving cars there. it was a little scary. but it was a very different system. and it was one that actually was talking directly to the traffic lights, and things like that on a predetermined route. this is very different, mike. and it's just interesting what you were saying. a moment ago. about the snow. i remember actually the snow and those kinds of conditions being a huge engineering challenge. >> in some respects, maybe that's the perfect place to test it out. you don't necessarily want it to be artificially easy for these cars. i just find it interesting from a corporate perspective if this indeed is the future. uber has been so oriented encouraging people to drive for it. maybe now they're going to make this phase of the business like, you know, dvds in the mail was to netflix. it was just this kind of way to get you in the habit of using a product this way. >> i was going to talk about the air buds and air pods again. never mind. phil, thank you so much. can't wait to see how this plays out. phil lebeau. you can jog inside and outside, but can't use the
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elliptical machine outdoors until now. diane olick joins us from denver. >> anybody who knows me knows i hate the gym, but i love the elliptical. why do i know this story is going to cost me money? we'll show you more and maybe even a live wipeout, next, on "closing bell." ♪ mapping the oceans. where we explore. protecting biodiversity. everywhere we work. defeating malaria.
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welcome back. as you just saw, ellipticals are not just for gyms any more. one company has taken them outside and on the road. and diana olick has more for us. >> kelly, if this isn't a disrupter, i don't know what is. it's the brain child of a former triathlete, and a marine who couldn't run any more, due to injury. how graceful was that? anyway, he designed this contraption so that he could get out of the gym and on to the road, and he is selling it nationwide. so far, 17,000 of these have sold around the world. they're in 250 retailers across the nation. elimitigo is what it's called. it's being used by olympians, marathoners and clearly it's
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pricey. $2,500, but just launched one at half the price this year and sales are up 50%. you know this company really has a long road ahead of it. >> we're on a great growth track right now. so i think we're going to be attractive to these companies that are, you know, billion-dollar companies looking for the next new thing. if they're not interested in acquiring us, then i think an ipo is a legitimate route. >> reporter: now, this is being on social, people out there on facebook competing against each other. in october, there is an elliptigo run-around, competing against each other. like the games. back to you, kelly. >> is it easy to use, though, diana? >> reporter: you know, i had to do a little practice. i will tell you. but it's not bad. and to do it on live tv, it's really not hard. once you get the balance, it's all core. >> but you've got the skill. don't be fooled, viewers. diana can do this. i'm not sure i could.
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and there is a guy in central park always on his. you get the crazy looks for now, but we might start to see more. >> first adopter, that guy. >> brave guy. let's lots of questions. but sara brown, an olympian, used one to help her train while pregnant. we have to go. we're out of time. kayla, mike, thank you so much for joining us on "closing bell." "fast money" begins right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square, i'm melissa lee. tonight on "fast," crude is falling, incomes are rising. why are restaurant stocks on the floor? a market mystery that could point to a broader trend for the consumer. plus, donald trump gaining in the polls and a former reagan adviser says that could be a disaster for stocks. and he says that's exactly what america needs. what is he talking about? he'll be here to explain. and later, think amazon is taking over the world? you have no idea. we will take you inside a stunning research report that might have you thinking the stock is downright

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