Transcripts For CNBC Closing Bell 20160630

The dow and s p essentially erased about 80 of the losses incured after the brexit vote of last thursday when the uk voted to leave the eu and bank of England Governor Mark carney hinted that more stimulus is coming. Listen. In my view, and im not prejudging the views of other independent members of the mpc, the Economic Outlook deteriorated and some Monetary Policy easing will likely be required over the summer. What selloff . A little quantitative cant take care of. Just wipe it all away with easy money. Hershey rejecting the 23 bid and hershey shares are still higher. The market seems to think mondelez comes back with another offer. Trading above where it was before they rejected the offer. Netflix known for keeping the ratings under wraps and nielsen says it has numbers for some of the streaming services most popular shows, including season premier of orange is the new black. Those details coming up. Hef hertz signed new deals with uber and lyft. The stock is down more than 20 this year. Well examine whether or not its a good strategy. Tech stocks are rallying today. Its been one of the losers in the first half of the year. Bertha coombs with a closer look at that part of the story from the Nasdaq Market site for us. Bertha . Thanks, bill. The nasdaq is on pace for its first back to back quarterly losses in about five years. And really, its nothing to do with this weeks brexit plunge and recovered from that. The real story has been the breakdown of the big cap tech sector. Small caps are actually up for the quarter and year to date. But the big caps and, of course, when you talk about that, you have to talk about the biggest. Apple. Just didnt recover from disappointing earnings reports this quarter. Really the first half. Apple technically broken. Now down three of the last four quarters and not alone. Microsoft, off 8 year to date. Google down 10 . Intel and netflix, one of the fang stocks, down 20 year to date combining for a biggest point drag on the naz gak 100 in the first two quarters of this year. The chip sector has been the one big exception. Philadelphia Semiconductor Index looking technically stronger and 4 from a new high. But as for the nasdaq composite itself, well, as it goes in the first half, how does it do in the second . This is the fifth time ever the index started the year with two down consecutive quarters. In 2002, it was off 31 . The end of the year. Three of the last four times ended the year lower. First time in 1982 did it recover. Michelle . All right. Something to watch for the rest of the year. Thanks, bertha. After todays close, we will have officially completed the first half of the trading year. Mike santeli with more on the themes for the rest of the year. Mike . Yeah, hey, michelle. Some of the obvious stuff, massive rebound in the oil market and finishing up in the s p 500 and heres themes that did animate the first half. Uss a safe haven and flat for the s p 500, the average stock up 3. 2 . Also, way out performing every other equity market index in the world. The lust for yield. We talk about this. That compression in global bond yields, in demand right now. The dividend sen trick stocks massive outperformers. People think theyre too expensive and where people are going for that scarce income. Heres another theme. Main street over wall street. We have seen this trend since really the middle of last year and wages growing much more quickly and corporate profits on the down swing. I think that probably continues even if profits stabilize. For the second half, is the fed really sidelined . I think theres a comfortable consensus. People think the fed isnt able to move to raise rates any time soon and perhaps not this year or next year and wait for the jobs number next week and Inflation Numbers at the target. That could be something to watch. Bank stocks jerked around by expectations for the fed. Business investment revival. A missing piece and the market story industrial stocks really should depend on a rotation into more Capital Spending and then late cycle storms. Late in the economic and market cycle. Typically volatility will pick up as you get there and people get twitchy about whether we have a lot more to ask of this cycle. Of course, this is seven years into a recovery. No saying exactly how long it can go and people on alert for the signs that maybe its closer to the end. All right. Mike, good stuff. A lot to think about there as we go into the second half there. Lets talk about the closing bell exchange. Susan fulton with us. Jonathan korpina here at New York Stock Exchange and Rick Santelli getting over the carney announcement. He is in chicago with. To talk about that. Well talk about that in a moment here. John, first to you and today, whats motivating the market higher here . I hear about these pensions that are doing some trading here. We have got the end of the quarter, the end of the first half of the year. Whats going on . A combination of a few things here bill. The end of the month, end of the quarter, end of the half year. We have Pension Funds money looking to come into the market. By the end of the day today and then see that normal window dressing activity and the way the market traded, volatility, theres Short Covering here. I think the short traders were not expecting this market to continue this rally. Yes, we did get a bounce after the two down days. But to see this consecutively happening now, i think the short covers have come back to this market and dont want the positions right now. If you missed all the news thats happened in the last four days and you opened up a newspaper today, you would think nothing has happened to this market because the numbers are exactly back to where they were. That is amazing. I know. I was looking at the European Market performance over six months, shocked to see what is the best performing European Market of the majors over six months . Surprise london. The ftse is in positive territory. Germany sold off hard. France, italy is just horrific. I mean, look at these moves. Of course you want to leave the European Union right now. Absolutely. Susan, is there anything more important in this market right now as a factor thats driving Asset Allocation than all of those negative yields . Mike santoli highlighted that lust for yield with trillions yielding negative in the bond market. I mean, utilities up as much as they do makes sense. I dont think theres anything bigger than the yield market. I dont think theres anything bigger. With britain saying it will probably lower rates, losing its aaa status in terms of its bonds, you know, i dont think theres anything bigger. We have been saying for a year now, year and a half, that we dont see Interest Rates going up until 2017 at the earliest. Interestingly enough, it is not an economic decision. It is a demographic decision. The world is getting older and were not we pairing for it. Yeah. I mean, were looking at the chart of the best and worst performing sectors. We have been having this running joke. I will ask a money manager if they would invest in utilities, thats too boring. Anything but. Yeah, yeah. Second best performing sector this year. Hold on. We have breaking news. On the st. Louis fed president bullard with negative yields. Not all that enlightening making the comments earlier. As a matter of fact, on june 17th. And i read through the whole report. Basically word for word. He is sticking with and repeating the new Monetary Policy framework that the st. Louis fed adopted on june 17th. It is very interesting because he refers to new regimes. Economic regimes that basically he wants to put in place at the st. Louis fed. For a long run outcome for the u. S. Economy. And basically theres no reason to forecast any sort of recession given the current data. Also forecasting one rate hike which was detailed earlier, as well. Single rate hike for the foreseeable future. Repeating the new Monetary Policy framework and put it in place before the brexit vote. Hes sticking with 2 growth. 4. 7 unemployment rate. 2 mean inflation. And fed funds rate basically we are going to see one hike. Thats what hes detailing in london. We were wondering to get the old hawkish bullard or dovish. Thats exactly right, lower for longer. Thanks very much. Rick, couple that with i could hear it when it happened, i could hear you slapping your forehead and mark carney said to probably reduce rates this summer sometime. Stocks sold off, rick. They need lower rates. They have to do something. Obviously. I mean, the world is watching. Uk rates are obviously too high i mean, the fact that they broke 40 or 50 basis points or with the relationship to the boon changed 40 or 50 basis points. You know, some on the floor said maybe he wanted the currency lower. Give him a shovel. He can dig a hole to make it lower. I mean, come on i dont understand. Listen. You know me. Ive thrown out compliments to the current fed like i throw around chicago manhole covers, okay . Ill say ive heard very little out of our fed. I think thats a wonderful idea. I think if you want to call brexit a crisis, many experts that were wrong did and whatever you call it the market is dealt with just fine. This micromanagement and ben willis said it best. He talked about the qualifications of those making these decisions but, yeah, i dont know where you draw the line. You know, once again, lets keep it simple, people. Brexit is a call that you cant lead the world by the nose and think you know everything just because youre a leader. And i think that isnt only true for government, true for all the sub agencies like the central banks. But theyre going to keep playing. Okay . And just like brexit, theyre going to ignore the signals until the reins are taken away. I would continue to monitor, for example, italian banks. One thing lost yesterday with the eu summit is that Prime Minister renzi tried to get merkel in germany to bail out this bank. Okay . Even though they have a bailout fund. We are in a crisis. This is time i want the eu and brussels to bail it out. She told them, no. But their Banking System down close to 60 now. Those are the things to watch to really make a difference in the market. Horrific. Yeah. The moves in the italian banks have been. We wondered what they protended. I think you have to keep in mind were almost back to where we were before the brexit vote shock and also been at 2100 in the s p. Almost there. We have been there dozens of times. Have not been able to make headway above it and another challenge going into a new month, new quarter. Well see if theres more fuel in the tank after today. All right. Everybody, thank you. Appreciate your thoughts on todays market. Good to see you. Take care. Thanks. We have about 48 minutes left in the trading session here to finish out the month, the quarter and the first half of the year itemizing. Dow up 202 right now. Sweet deal in the works getting gummed up. We need a lot of candy metaphors for this one. Hersheys board rejecting a takeover offer. David faber will have the developments next. A senior netflix executives says the video streaming giant is looking into the chinese market. A leading analyst will tell us what a chinese entry could do for Netflix Subscriber base and the companys stock. Thats coming up. 45 minutes left or thereabouts. In the day, in the month, in the quarter. Et cetera, et cetera. Dow was up 221 at the peak. Up 122 right now. This is like a merger monday. Merger thursday. Lionsgate buying starz. That deal follows months of talks. Media mogul john malone has interest in both companies. Good for you, dr. Malone. Speaking of deals, proposed blockbuster candy deal hitting a road dsz block. Hersheys board rejecting the offer of mondelez. David faber has the details. David . This is just getting good here. Moved very quickly today, of course. Dow jones breaking the story earlier today and then details of the 107 a share half stock, half cash deal. That offer delivered last week was promptly rejected by hersheys board just about a half hour, 40 minutes ago in a press release in which it said that not only did it reject it after talking to its Financial Advisers and bankers, lawyers, but that also, it does not provide the basis for further discussion between mondelez and hershey and seemingly did nothing to dissuade them from sending the stock higher for a long halt for news pending from hershey. Now trading right near the highs of the day. Why . Well, the expectation, of course, the rejection was based on price and therefore that theyll continue coming back with a higher price for attention and allow for further discussion. And, well, perhaps the idea of somebody else out there although that always remains somewhat unclear. We didnt get to the trust. You know, it is interesting. I spent a lot of this day reporting on the Hershey Trust and controls 80 of the vote as hershey and you have to get the approval of the trust. As i reported earlier, they were willing to say, well change the name of the company to hershey. Move the headquarters of the business to pennsylvania. Hershey, pennsylvania. And well maintain the manufacturing jobs in that state. All of that designed to get the approval of the trust. The problem is first you have to get the approval of the board of directors of the company. The rejection today is the people running the company. Correct. Different than the trust of the board of the trust. That is right. There are some overlaps in directorship and people who sit on the trust board, remember, the trust started by Milton Hershey many years ago to take care of disadvantaged children. Enormous. 34 ownership it has in hershey. And they first have to hear from the board so in this case its interesting to note in the press release they talk about, well, we received input of management, the board of directors, from outside financial and legal advisers, they dont say advice from the trust itself. Thats the next step. So if youre trying to get a deal done, you have to have a deal with the board and unable to do and then move on to the trust. Who else is out there . In Emergency Rooms of what . What might bid for hershey . Yeah. Nestle. Nestle is a name you certainly hear and private companies or family controlled companies. Faro. Nestle, by the way, has a deal to license kitkat to hershey in the United States and important part of the business and values that business at 3 billion. Its a great candy bar. Youd have to imagine if nestle makes a bid, by if way, theyre in health and wellness right now, down that path and if they were to make a bid, 3 billion away and getting that business back if hershey changes control. Mondelez is trading higher. Normally a deal announced or potential deal, the acquiring company goes down. Unless you think, god, this is super or Something Else going on and worthy of noting, no . It is. What you showed earlier, lionsgate down because people worried about the price theyre paying in the deal and can be the case, michelle. Here i think the stock is up in part because people like the idea of it. Global behemoth in the chocolate business. But you have to also consider the idea that mondelez sent out word to those who might have interest in buying them that you better move if you have any interest an im not saying there is but move now because we might get a lot bigger and wont be able to buy us down the road. Interesting. I have a feeling to hear from you in the not too distapt future. So interesting w. That weird trust structure. Super interesting. Ill have a milky way bar after all this talk. You do that. Do research. Thats mars. Yeah. Sorry. No idea. Its all chocolate to me. All good. 40 moneys left in the trading session here. Dow jones higher. Nasdaq higher by almost 48. Netflix lurking around chinas doorstep. A leading analyst will weigh in. Look at the risks and rewards that netflix could face entering the market and boasts several home grown streaming services of its own coming up next here. Later, yuri milner spoke exclusively with kelly evans about quest investment. The search for alien life. Thats cool. Dont move. Netflix continues to make a push into china, even though that companys struggles to break into other asian markets. South korea is a good example. Tuna amobi joins us. Its a great market, great opportunities, but the structure over there, the political structure and the economic structure are huge impediments in some cases, arent they . Thats right. Its an attractive market but the conundrum doesnt go away overnight. Media Companies Understand that china has unique challenges and attractive market so for netflix i think probably going to be a marathon, not a sprint. This is a market that requires a lot of patience and overtime i think the upside is quite tremendous. Does the stock move if theres an amazement and going to do this . Does it move lower considering how much trouble companies had going into china . I think they have demonstrated track record of launching successfully in several international markets. You know . Granted china has unique challenges. We expect an announcement from the company in the second half of this year in terms of their specific strategy to enter china. We expect them to be more open minded. But the chinese streaming market is more competitive so i think that for netflix they understand the challenges and by the way was smart of them to leave china last for their rollout so wed be very patient here and dont expect it should affect their global profitability for next year. You anticipated my next question. Sometimes companies have a to do a joint venture with a Chinese Company to gain entree. Whos over there . What kind of competition do they face . Not just from the internet giant that is you know. But theres a host of, you know, local players that are very, very, you know, strong competitors in china and i think china has unique challenges, broadband speeds are not as high as here in the United States. And i think the market is a little bit more, you know, fragmented. Having said that, you know, i do believe that theyre moving in the right direction and if netflix is very smart about how theyll large or partner with, i think theres really tremendous upside here. What do you make of the stories saying that nielsen has got some numbers on streaming now measure them and that, for example, the premier of orange is the new black watched by 6. 7 Million People in the United States . According to wall street journal. Good enough number . Second 5. 9 Million Viewers. Where does that fall in to what you hoped, expected and does that bolster the valuation it has or hurt it . Well, you know, i think the data that nielsen released, you know, is a very significant step in terms of what, you know, Investment Community and studios clamoring for and when you talk about orange is the new black getting 6. 7 Million Viewers in the premier, its remarkable. The viewership on netflix rivals some toprated tv shows and more importantly sets what could be the stage for a lot more data towards this socalled total audience measurement. To date, streaming is the missing piece of the puzzle so when you can aggregate the data and put it together, it can be really very powerful but more importantly than static data point you want the know, you know, how the shows has progressed over the season so orange is the new black in the fourth season. We know that the viewership grown over the years and not nearly how much and it will add more confidence in terms of the dealings between netflix and the other stakeholders. Do you like the stock here, tuna . We do, we have a buy recommendation. We have a 12month target price of 120. Theres resetting of valuation and everything really seems to be in place for them to deliver on the International Expansion strategy and if they can get through this year 2016, you know, we think it sets them up well to really, you know, expand on their profitability and be able to okay. Worldwide in the next few years. Wow. 100 million. Holy smokes. Tuna, thanks so much from s p. Thanks. Time now for a cnbc news update with sue herrera. Hi, sue, bill. As the death toll of the airport attack rises to 44, a turkish official says the three systuic bombers of russia, ukraine and kurdistan. Authorities said all the information so far suggests the attack was the work of isis. The government is urging owners of 313,000 older hondas and acuras to stop driving them and get them repaired as soon as possible. This after two tests found that their takata airbag inflaters were extremely dangerous. The fda is barning against batter of any kind with an outbreak of illnesses of a strain of e. Coli found in some batches of flour. General mills voluntarily recalled 10 Million Pounds of that flour. Johnny manziel is suspended first four games next season for vie latting the Substance Abuse policy. Manziel released by cleveland in march facing an assault charge in dallas involving a former girlfriend. Thats the news update, guys. Back down to you. All right, sue, thank you very much. 30 minutes left. Here we go. The most important half hour of the trading session. Dow up 206 right now. Wall street guru it says here. We called you a guru. Thats true. What art cashin is watching next. Very zen, you know. Also ahead, two main Street Investors that join us the day after the brexit vote tell us if the strategies changed now that brexit is in the rearview mirror. Todd spaletto, president of the north face, we are working on the prototype to match customers to gear. Watson, lets give it a try. Say its midjune and im backpacking in yosemite. Of our 353 jackets, i can recommend nine. Watson, what if it rains . There is just a 3 chance of rain, so i recommend the breathable stretch fleece fuse form dolomiti jacket. A Perfect Choice watson. No wonder our Customer Loyalty numbers keep climbing. I believe we can do even better. I like the way you think. I believe we can do even better. In a world held back by compromise, businesses need the agility to do one thing another. Only at t has the network, people, and partners to help companies be. Local global. Open secure. Because no one knows like at t. The dow up 215 points. The high up 221 today. The s p up 25. The nasdaq, the laggard today and for the first half of this year, actually negative for the second consecutive quarter. First time thats happened since 2002. Michelle . Bill, so this is the big week of brexit. Art cashin, ubs financial services, joining me here on the floor. The uk market up for six months and the other major European Markets are way down. I thought it was catastrophic for the United Kingdom. No, not gnat aat all. Looking at ftse theyre in exporting getting 22 of the gross rev news of inside the british area. So, what youre seeing is beneficiaries of a falling pound. All of their products and services will be cheaper. Theyll be able to export more. How much speaking of the uk, how much of the move we saw in the stocks today in United States is mark carney coming out and saying theres got to be more stimulus in the wake of what happened . A. Well, he helped bonds better. He certainly had an impact on the currencies. I think what you are seeing in stocks here, rumors around for a week that a lot of Pension Funds saw their portfolios out of balance because of the postbrexit moves and needed to buy stocks and sell bonds to get in order and so you can see it in the stocks and bonds but that i think is because carney benefited the bonds. Got it. All right. Relay location going on . Yep. Thanks. My pleasure. Last week you will recall on friday the reaction postbrexit. Today we have them back to tell us how their strategy changed in the past week and welcome back for the Retail Investor roundtable, julie warner of better investing and deman hicks. Good to see you both. Its been quite a week. Last week, deman, you said you were getting a list together because you planned to do some buying. Tell me you have bought in the last week here. I bought but not like i wanted to buy. I got in to tech stocks and i bought two reit companies but everything turned around so fast and everything started to increase. I didnt have time to do the Due Diligence on other companies that i was interested in. So many people well, i know of some people who were panicking last week, julie, but now theyre kicking themselves that they didnt use it as a buying opportunity. You were planning to stand pat and wait it out. I assume you did this. I did. Looked at the portfolio over the weekend and, you know, its really amazing if you really were in tune with the market because we didnt go anywhere near the february lows and the market was still quite high and a lot of my stocks were not down enough for me to buy. Except for wells fargo which went down to that february low and so i was able to pick up some wells fargo at 3 dividend yield and that was one purchase i made. All right. Looking for yield. What do you think about the negative yields in the world and does that impact you deciding what to buy . You mentioned some reits . Are you going after reits because of yield . I am and dividend payout for longterm investments. The dividends look good. I looked at washington reit and City Office Reit and dividends and yields look great. What are you getting on those . Im getting, i believe its 24 cents a share for one and 92 for the other. Wow. Got some income in this. Im going to pound the table in the utilities again. I always do this. Julie, you know, theyre so boring. Money managers dont want to touch them. Last year they were the best performering sector in the stock market in the u. S. And the six months of this year, theyre up 20 . Whats wrong with utilities . Theyre not complicated. Theyre not except for theyre not really growth companies. You get the yield and a lot of times you dont get growth in those stocks. I would prefer to buy a Growth Company to have a growing dividend over time. And one of the other stocks that, you know, bank stocks are controversial, but at some point in time Interest Rates will go up and a local bank that i own synov is in georgia didnt quite get down to i wanted it in the mid20s. Down to about 28. But this is a company, its a local bank. They had some problems in the previous housing bubble and changed the ceo. Hes done a wonderful job. They have a great loan portfolio, investing in technology. Theyre going to start raising their dividend. Okay. Sorry. Didnt moo ento cut you off, julie. Deman, what are you looking for in an another pullback . What else is on the buying list . Like i said, tech. I usually dont have tech in the portfolio. I started to look at tech stocks. They look great right now and one is avnet and one is Arrow Electronics and looking at the fundamentals and all high and strong buys for short, immediate and long term. All right. Very good. Well, good to see you both. We made it through a hektdic week. See you again, im sure. Joining us as part of the investor retail roundtable. A favorite segment. Do love this. 20 minutes left in the trading session with the dow up 204. Uber, lyft and hertz all have one thing in common now and business is driven by automobiles. And now the longterm rental car king is teaming up with the rival ride sharing services. Well have details on the deal coming up. Some politicos on both sides of the atlantic believe the brexit vote is good for president ial aspirations of donald trump. Larry kudlow and barney frank debate that coming up. The light bulb, a bright idea if you use the right ones. Led bulbs use 85 less energy and last a long time, saving you up to 100 over their lifetime. Heres an idea replace yours today. [light instrumental music] three major averages having a great day long in the market. All of them higher by at least 1 . If they did that every day, you would have a great year she said. A decent first half. Yes, it has. But in the nasdaq lower in the first half. Laggard. Mobileeye . Higher on reports of working with bmw to develop selfdriving car technology. Mobileye makes cameras, softwares and components behind the autonomous vehicles. Intel is the Worlds Largest chipmaker. Rental car giant sherts looking to play both sides of the ride sharing game. Phil he bro joins us with the details of the new deals. Phil . Bill, this is one with hertz and lyft and basically comes down to this. Theyre going to take some of their older models, vehicle twos or three years old and hertz normally be selling into Dealer Auction lots or on its own and make it available for people who are uber or lyft drivers or some other ride share service. They could then rent those vehicles for longer terms. Say for a week, a couple of weeks or rent it for a month and then become a uber or a lyft driver or do whatever you want to do there. The whole idea when you take a look at the market is that uber and lyft, theyre gradually expanding, whether its with rental car companies, the deal that lyft is doing with general motors, gm having a stake in lyft and toyota getting an investment into uber. Youre going to see it increasingly and targeting drivers that dont own cars and they believe theres growing demand there and keep in mind shares of hertz unclear how much demand there is in terms of people that dont own a vehicle saying, im going to rent one for 180 a week and not only make enough to pay for it but make enough to sustain myself, make a living off of it. Thats unclear at this point. I talked with people of sherpa share and they track and work with these drivers and they even said, look, the vast majority of people who do this own their own vehicle and some people out there unclear how many who are looking for this type of an arrangement. Its an interesting deal, guys. You know, i was thinking about this. The economics of it all. This makes sense if you dont want to use your own car, the wear and tear is terrible. Rent this out. If you can make enough money and pay for that rental, you know, this is sure. This is even more than just a sideline for a lot of the drivers out there. Right . Right. But the question becomes, how much demand is out there . In certain urban markets, no doubt theres demand for uber and lyft and why they start the program out in los angeles, las vegas, denver, san francisco. Out on the west coast. But eventually expand it nationwide. Ill be interested to see how many people take advantage of this. How much is a camry . I use uber a lot. The vast majority is less than a taxi is camry and think you can get it less a month than 180 a week. Thats the calculus to do. Theyre not giving specific examples like the camry. Theyre saying a good example is a mid sized two to threeyearold vehicle that they would sell and allow you to rent for maybe 180 a week and question becomes, can you get enough people in there on a regular basis to not only pay that but, you know, earn some money for yourself and what this is all about. Yeah. Thats it. Fascinating. Love that. Thank you, phil. Very much. You bet. You mentioned wear and tear in new york city, also. Just rent it and try it out. Dont commit. If it doesnt work after a couple of weeks, you dont own the car. Just give it back. You going to try it . No. Im into we got 13 minutes left in the trading session. The dow up 186. Kind of i dont want to make much of it. Up starting to lose altitude here. Well see what happens here. As the markets move into the second half of the year, we have a guest whos a small and mid cap stocks most attractive opportunities for growth and explain that next. Welcome back. Ten minutes left in the trading session here with the dow up 186. Art cashin in the break said that the market on close orders calls them a nonevent. 200 million to buy going into the close and doesnt look like its having much impact heading there. George blair is here to make the case for small and mid cap stocks. Its interesting because for a long time balance fund said were not worried about europe. We dont like what happened in england but we buy Companies Whose earnings are linked to whats happening here. We hear lower for longer and suggest that the economy here isnt doing well and worries me about those stocks. I have to say its interesting because the stocks we buy we think has great longterm potential. We think thats important. Not like the big ones, johnson johnson. Exxons. Ours are more the lesser stocks to grow to be known stocks and doesnt take much capital to move those and undervalued for sometime in 2015 and 2014. Give us a for instance. Who do you like here . Good stock, skyworks. Owning an apple phone or a samsung, this is the company that makes the guts internally. 10 worth of equipment now are in the phones and will be 18 soon enough and people say apple is great or samsung or whatever it may be. S in the company that makes the guts. Thinks of picks and shovels in the gold rush. Lets just use the picks and shovels to make the money. Find the gold or not. Thats it. You like Financial Engines fngn. Thats interesting, a play on the reretirement systems. It prohibits any employer telling or suggesting an employee what to do with the money and the employee doesnt know what to do. Theyre a middleman and make the help to try to explain to people where their mutual fund should be, what they should own so its a perfect middleman. Dont charge much to do it. They manage 100 billion right now founded by a nobel laureate, bill sharp. Good to see you. Thank you. George young. Well take a break and come back in a moment. Yep. And then after that, apple may be cranking up the music. Well do the cover and spotify saying it wont approve a new version of the app worried about competition. That will be a good one. All right. Heading to the close, bob pisani as we wrap up the month, the quarter, the first half of the year. Lets take a look at the three major averages and how they performed these First Six Months. Dow and s p higher. The russell up half a percent. The nasdaq down 3. 5 . Outperformed the world. Virtually the other major boers around the world were down. In europe, the performing market is uk. Theyre actually higher in the six months, everybody sels lower. You have to be careful. Ftse 100 is higher but the ftse 250 is down, Broader Market there. Sectors. Very defensive market. Had to be defensive to make money the first half of this year. Telecom and utilities were the best performing sectors First Six Months. Technology and the financials hardest hit in the First Six Months of this year. Encouraged by the fact that oil came back and Energy Stocks did do better. The 10year yield, going out at a 4year lower or just off of it here and imagine what that chart looks like for the first half of this year. We started the year just under 2. 4 and now were at 1. 48 going into the second half of the year. We had a very strange day today. Normally yields were down throughout the day. And normally thats a negative for the markets. Mark carney at the boe saying look for rate cuts there. Oil, what a volatility commodity this year. We started at those near historic lows. Multiyear lows for the price. And then its come back again. Were still below 50 a barrel right now on wti. Finally gold. Gold bugs had their say at the end of the six months. Were back to 13. 25 right now. We started the year just above 1,040. Thats one fear indicator of sort that didnt back off and very interesting. Down a tiny bit today and not statistically significant. I wanted to show you what happened today and a board here for because the s p is up on the day where the dollar has been up. The 10year yields generally moving to the downside and not recently here and oil is down. Getting the combinations, the market is not up like this. My feeling is theres a little bit of unusual end of the year mass nations. We have been talking about outside influencers like pension fund rebalancing. Im much more interested in seeing the next few days and next week with a more normal situation without end of quarter gyrations going on. You wonder how much of an impact brexit will be in the near term here when theyre trying to figure out the leadership in the uk and until they figure out who the next Prime Minister is going to be, we wont know they invoke article 50 then. Right . A long, drawn out process and well talk about the potential impact of brexit on earnings in the United States which is my immediate concern because i think there will be some knockeffects to hear about in the next couple of weeks. Thank you, bob. See you later. Putting them to bed. The books for the first half of the year with the dow up 226 right now. Happy is ringing the bell here. The new york society of security analysts at the nasdaq. Stay tuned for hour number two. A big and loud crowd down here today. Bill will rejoin us here in a second. Heres how were finishing the day. Dow jones industrials higher by more than 1 . S p higher by 1. 3 , a gain of 28 points. 2098. Nasdaq higher by 63, another gain of more than 1 . 4842. It is the last day of the Second Quarter. Heres the check on the major averages finished the first half of the year. All finishing higher save for the nasdaq which is down 3. 5 . The dow up 2. 6 . S p 500 up 2. 3 . Small caps up 1. 2 but the nasdaq lower. Different story for the European Markets. The United Kingdoms ftse, only index in the green. Uhhuh. Up 3. 6 . Almost 4 . The french cac down 9 . Germany dax down by 10 . Italy in six months down 24 . Joining us today, cnbc senior markets commentator and columnist mike santoli and stephanie link and luciano from wisdom tree and fast money trader guy adami. Good to have you here. Mike, whats the key theme here today . Well, obviously, follow through. Almost a buying panic as the day went along. I was surprised by it yesterday. I said i dont see a buying stampede today. A logical place to pull back after a twoday gain. An element to keep in mind, because treasury yields have not lifted in this equity rally of three days, you have the bondlike stocks also going up along with the growth and more cyclical ones and rallying those other things are backing away and seems as if everything was working and clearly people were underexposed to stocks after the weekend. At least they felt that way going into june 30. The month end. Finally, though, weve been here before. We are at this level. Memorial day. Basically. We have been at 2100 several dozen times in the last s p 500. We have to see if we have a better chance of vaulting. Stephanie, plenty of people felt like the selloff of friday and monday was an overreaction to the brexit vote and now maybe thats been bowed down and gained back little more than 80 in the declines. Seems like a bit of an overreaction. I was excited not have to worry or talk about brexit today with a lot of other things going on that had me excited like ccar and a big topic and the banks did fairly well and rallied into the news and m an in the food decision and Consumer Staples outperforming dramatically today. Of course, we had some consumer data points mixed. Car den was bad. Pier 1 was bad. Constellation was good. We got back to fundamentals and what i like to focus on. Guy, what do you make of the trade . Yo, mcc. Great i mean, you are a jet setter all over the planet. I love the way you said luciano. Drop the mike right there. Did that there. I got to be honest. An overreaction . No. Underreaction. Here we are 100 points higher and should be going lower. Look to me for erudite comments, this is the wrong person because its a deal. Looks like it comes down to just a scarcity thing. Bank of england, you know, talking about cuts there. It comes down to where people are going to put their money and i think theres a scarcity issue in terms of where they can go. Mike talked about, look at, again, utilities. You want a perfect example of whats going on over last couple of months . Pull up a chart of at t and verizon over month and a half, two stocks, two stocks sideways for the last four years, both of them broken out significantly to the upside. No new news. Didnt reinvent the business and people chasing yield. Good thing . I dont know. Mike pushback would be this. Whens the right multiple for s p . You can argue its lower and whens the right multiple for that number in the Global Environment . Negative yields and. 16. 5. People say higher. Because of those low Interest Rates. Thats what makes markets. Can i do this . Yeah. Im sorry. Go ahead. Plenty of Money Managers coming through here before the brexit vote saying theyre starting to go to europe. Theyre going to underweight the u. S. Relative to europe. Do you think that would still hold now or is the european radioactive right now for investing . I make a distinction. You mentioned it earlier. Uk stocks, this week, uk stocks were up. Currency that was down. But the stocks were actually up. Obviously, some of the banks were down. Uk equity market up while the currency got hit 10 and may be an opportunity to start to taking a look at the uk multinationals to benefit from a lower sterling. Second point was what happened with yields. Negative Interest Rates in europe and thats acting as a Gravitational Force and what does that do for the higher yields part of the market . Puts it in play. The s p up 3. 5 yield to date. Dividend paying part of the market up 11 . Midcap dividends about 12 . You have seen this across the board for the entire year but i dont expect it to continue as long as raitds stay in the range. You know, guy raises this question about what multiple should you pay . Yeah. If yields keep going down and down and down you can afford to pay a higher multiple. Professional siegel thinks 20 times for rates this low. I would say on the upper end, a range bound market. 19 times earnings on the high end and 16 1 2. 16 1 2 is bottomed at 1800 back in february. I said 1800 to 2100 is the range. 19 is probably the range on the upper end of the pes until earnings pick up and why july is so important. All right. Dow and s p ending the Second Quarter in positive territory deexcite the fallout of brexit. Bob pisani with what to expect from the Third Quarter. Bob . Bill, what impact if any will brexit have on earnings in the Third Quarter and the Fourth Quarter . Two particular areas i have worries about. Take a look here. First off, five consecutive quarters of negative earnings growth. A major problem overall for the markets and expected to be positive in q3 and q4. Heres the issue. Higher dollar impacting things potentially. Technology stocks and material stocks. And Energy Stocks. When we have the lower rate scenario, you were talking about this earlier. Lower rates for longer impacting the financials overall. So theres a whole series of sectors impacted by the dollar and higher rates very easily. So take a look at freeport mcmaran. It dropped on costs overall. Thats a big issue there. Freeport year to date. Alphabet, a quarterly of the revenues exposure in europe. Could be an issue for them. And then take a look at a financial of Goldman Sachs. They have operations in europe. Significant Wealth Management overseas. Those are all issues to impact them easily. Bottom line is in the next two weeks im waiting to see what they have to say about the potential impact from brexit but watch for the dollar and watch for the lower rates for longer scenario playing out in the United States. Guys, back to you. All right, bob. Thanks very much. Still mentioning brexit here. Sorry. We are not done. Just for today. At least we can kind of focus on other things. Do we need to worry until they invoke article 50 . It is top of mind and hopeful to focus more on some Economic Data points. Nonforeign payrolls of next friday and very big number in terms of what rates do. If they take another leg down or stabilize. Because thats really unsettling to a lot of the parts of the market particularly financials. Can they hang in there . What do the jobs numbers look like . What do Companies Look at for brex it . Luciano, is there a larger market lesson we learn over and over again here which is the consensus is, a and almost always wrong and catastrophic for the United Kingdom but the people really in trouble isnt the United Kingdom. It is the European Union. You know, that may be true. We always think at the end of the day you have to take these big news events with a grain of salt. The market has a way of digesting them. We saw it in the first quarter, a tale of two quarters. We continue to believe if youre investing for the long term you need to get paid to own stocks. Right now you are not paid to be owning bonds. We continue to believe if youre investing for retirement, three to five years, you have to have the dividend as a key part of the total stock return because equity returns may be going further than they have been in the past. All right. We have an earnings alert on micron. Hi, bill. A mixed report of the player that specialized in dram and nan technologies and loss of 8 cents. Better than street expecting. Revenue a bit disappointing at 2. 9 billion. In the press release, the ceo says we continue to face Challenging Market conditions and, therefore, the companys implementing cost cutting measures and job cuts to save over 300 million in fiscal year 2017. Keep in mind the stock is falling on this earnings report, down 5. 5 after hours and this is one of those stocks thats really weighed on the nasdaq down about 27 over the past 12 months. And it also trading around 12, 13. Just last month under 10 a share, bill. All right. Thank you very much. Michael, as we head toward the second half, im mindful everybodys searching for yield. We had a Retail Investor on last hour. Hes in his 20s and playing reits for the yields. Momentum i think appeals to people. The problem with that is going to if the consensus that treasury yields stay this low for this long, proves wrong, then getting a slight yield preel yum through reits and the consumer staple stocks doesnt look so great and thats the question. In the 20s, how long do you want to bet that this is the Interest Rate landscape we have . Guy, we have been asking this question i feel like for almost 20 years. I mean, rates have done nothing but go down and down and down. Last 15, 17 years. Yeah. Ive been in keep waiting. One of the people in this rates are going down camp and i think they go lower. Price action in tlt last two days is concerning if youre bullish w. That said, you know, i think the yield curve continues the flatten. And 10year down to 1. 25 . I have incorrect brily thought thats bearish pointing to a global deflationary environment. Other peoples argued correctly that the stocks going up because of the reason that i said they should go down. Again, thats what makes markets. To stephanies point, you have earnings coming up. You need the commiserate Revenue Growth to offset the manufactured and managed eps growth of a couple of years and i think this quarter, again, it comes down to are you going to see the Revenue Growth . Is the chasm of eps growth and Revenue Growth going to narrow . What happens to margins if you dont get the top line, do you get margin stability or peaked and add fuel to the bear case in the market . Very good. Luciano, good to see you. Thank you. Appreciate you coming by, guy. Yo see you next hour, buddy. Im coming down there to see you, bill. Be ready. I keep hearing that. Ill be there. It will be fun. Catch guy and the rest of the crew on fast money at 5 00 p. M. Eastern time and joined by a guest who says nows the time to take profits. What is she saying . Coming up. Banks had a dismal first half of the year. But is it time to bet on this beaten down group after the strong stress test results of last night and the widespread dividend and buyback increases announced after that . Thats coming up here. And apple under attack of a big streaming music rival. Spotify says apple will not approve the updated app trying to crush competition. Details of the music fight later. T 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. Impressive. Whats up, tim. Td ameritrade. Closing the books on the first half of the calendar year. Financials lagging as the worst sector in the s p 500 in last six months. Joining us to say whether well see a rebound, charlie from aerial investments and tony sharer with smead capital rates. Charlie, what do you think . Bank of england is talking about cutting rates further. What do you do with financials meantime . Well, the market agrees with you and thats why they have gotten so cheap and the nice thing about financials is theyre realtively easy to analyze and names of Morgan Stanley are trading below the value. Morgan stanley at 73 of book value. People were worried but the fed gave them the okay to buy back stock. Kkr is in a wonderful position trading at roughly back value and makes no sense. A lot of banks below book and people dont believe the book. You believe the book in. Thats right. So i would say that Morgan Stanley has a much cleaner book than some of the other big banks do. Its basically a lot of stocks and bonds. And the book right now, again, it is 73 of that book. A bank of citi or b of a you could argue is tough to analyze. Tony, what are you doing with them . Thanks for the question. We own them. We like them. We think their Balance Sheets are very clean. They stand trial every couple of months and stood trial last week and passed with flying colors. Again, here recently. And now theyre upping the dividends and engaging in buybacks and we think thats a stage of more to come in that regard. All right. Are you willing to touch any of the foreign banks, european banks at this point . Are they just we had kevin oleary earlier on and said they glow in the dark like neon because theyre so dangerous. Charlie, youre shaking your head there. Yeah. Everything about Morgan Stanley easy to analyze, the opposite is true of big european banks. They dont mark the positions to market the way the u. S. Counterparts do and the negative Interest Rate environment is much, much worse. So, guys, its stephanie link. I agree with you both that theyre very cheap. Theyre very well capitalized. Tangible book value is very real. I guess my question to both of you is, what is it going to take, if you have rates staying where they are, if you have a flatyearold curve for a year, do you think the stocks outperform . Tony . You know, that has been a reason to trade the stocks around. They become trading stocks. We think whats going to matter ultimately for the banks is risk taking becomes something that happens again and they have a lot of room to lend and so we think loan originations are the story in three to five years to drive the earnings higher in the banks. Charlie, im interested in the take on Morgan Stanley and not just book value is clean enough and reliable, but that the Business Model still works at these rate levels. They have a tremendous commitment now to retail business. I think people now recognize exactly how much that was subsidized by just the interest spread on the cash balances and things like that. So obviously you think they generally have a franchise to capitalize on this environment still . Yeah. Absolutely. In fact, it is better. A lot of European Investment banks are weaker so Morgan Stanley and Goldman Sachs are better and you made an important point that is this Interest Rate environment isnt going to last forever. Well get back to normal Interest Rates and when we do they make a lot of money on the cash balances. All right. Sounds like you have to be very patient for that time to come. Yes. Charlie, tony, thank you for joining us today. Thanks so much. Thank you. So happenapple is sounding note if spotify saying they rejected the updated app to limit competition with apple music. Next, looking at the impact on apple if spotify has a legitimate claim. And then still to come, barney frank and larry kudlow on the potential Economic Impact of brexit and whether that vote could have an impact on our president ial election come november. Thats still to come. Will your business be ready when growth presents itself . Our new cocktail bitters were doing well, but after one tradeshow, we took off. All i could think about was our deadlines racing towards us. A loan would take too long. We needed money, now. My amex card helped me buy the ingredients to fill the orders. Opportunities dont wait around, so you have to be ready for them. Find out how American Express cards and services can help prepare you for growth at open. Com. Yet another fire fight in the music streaming wars. Apple accused of blocking pot if i. Josh . Well, michelle, spotify has now sent a letter to apples top lawyer saying that the company is harming spotify and its customers. Thats according to a new report in recode. According to a report here, spotify says apple is blocking a new version of its app for the iphone. Apple apparently demanding that spotify use its billing system on the app store. Spotifys lawyer reportedly saying we cannot stand by as apple uses the App Store Approval process as a weapon to harm competitors. Spotify is arguing that apples real aim to squash competition. Remember, spotify saying in march it had 30 million paying subscribers. Apple telling us recently they have 15 million for the music service. Apple charges a monthly fee of up to 30 for the billing system. Spotify passed on the fee to apple customers with 13 bucks instead of 10 and then as recode points out spotify started to offer subscribers a new deal they could get three months of Spotify Service for 99 crepts signing up via spotifys site and spotify saying apple threatened to remove the app unless they stopped telling subscribers about the deal. Theyre not commenting. Mark mulligan, an analyst, notes its really a question of leverage. Aping knows that spotify needs the iphone to reach fans but if apple overplays that fan he says it could anger users, causing them to leave for android and worrisome more, getting on the wrong side of the regulators. Back the you. Josh, thank you very much. On we go. We have breaking news regarding tesla. Phil lebeau with details. Tell us about it. Bill, this is a very important piece of news regarding tesla. U. S. Safety regulators opening an investigation, national highway transportation system, tesla of the system of a fatal crash. It goes on say that that the model s in selfdriving mode in fatal crash and yet to reach out for comment on this and gets to the heart of many people talking about, not just with tesla but with all the automakers seeing the semiautonomous drive systems and the technology in the vehicles, what happens if one of them doesnt function properly. We dont know if thats the case here and theres an investigation in to this system being used a model s that was involved in a crash with the fatality. We are going to try to get more information. You can bet this is going to be very high interest not only for tesla investors but the industry overall. You can see the stock moving lower already by more than 1 . I dont want to make light of this. Are we surprised they have to investigate an issue like that . Theres only a time when one of these might fail. We dont know what caused this. Interesting point psychological. Human error costs thousands of accidents, fatalities a day probably. Yet if the idea that it could just be a bug or a malfunction, seems unacceptable and probably going to affect peoples perception of the safety of the product. Phil, planes are flown automatically nearly 100 of the time now, right . Correct. Well, they are. Except for takeoff and landing which is the most critical part of when a plane is flying. Once its in the air, thats a relatively speaking safest part of the journey on autopilot. When whats interesting is we might see this take place, not just with tesla, any of the systems, ive driven teslas with autopilot and i know other people who have, as well. This is not look around and dont pay attention. They tell you that you do need to keep your hands active from time to time on the Steering Wheel and you do need to stay engaged. We dont know the circumstances of this crash. So we dont know to what degree that the system might be truly linked with this accident other than the fact that according to ntsa the car was in autopilot mode and need more information. Who did you say down 2. 5 . Show us the mobileye then, as well. Heres a Company Involved and down. Suppliers. In sympathy with all of this. Of course that stock up 8 today. Sure. Right. Very serious, for sure. But i would expect more of these investigations. Of course. Just to increase over time given that the technology is so new. But and, phil, you would think the safety regulators would be doing more Due Diligence before these ever hit the road to begin with. Right . Well, thats not the way this works, bill. The way it works is they work with the automakers in terms of saying, hey, have you proven this out . Are you proven that the Technology Works . Years ago, when you first saw cruise control, where it would slow down before a vehicle, people said, i dont know if it will work. It was borne out that it would work. Doesnt mean there werent failures along the way and accidents. Probably were. You would have to search that. But overtime, this is how technology and new vehicles is developed. Its not as though the federal regulators put a stamp of approval on every piece of new technology saying we checked it out 100 perfect. They work with the automakers and suppliers and with enough confidence that the technology will work, then it starts to roll out into vehicles. I get what youre saying and agree. This is a different animal as far as im concerned. Other cars around. I want to know that they have double tested and triple checked this whole thing before it hits the ground. Right . Thanks very much. Regulators to keep you safe . Dont bother. Time now for a cnbc news update with sue herrera. Michelle, you make me laugh. Thanks. I appreciate it. An a 13yearold israeli fata y fatallied stabbed in her bedroom was a u. S. Citizen. She was attacked after a assan assailant entered the home. The attacker was killed by security forces. The group lick quid dating the madoff firm said hes paying out again. Pickard said it goes to 972 former discuss merles of madoff investment securities. Estimating the customers lost 17. 5 billion. Three people were hurt after a car crashed into a hair salon. Video that you are seeing right there showed the car plowing into the salon and several employees and customers inside. The driver was an 83yearold person taken to the hospital with nonlife threatening injuries. On a much lighter note, how about this . 17monthold, yes, a 17monthold boy learning to water ski in iowa. Flynn is skiing behind his familys boat in davenport. The family is part of a professional ski show team. So hes boning up to be part of the performance. Thats the news update this hour. Just learning to walk and now on skis. Awesome. Love it. Thank you. Youre welcome, guys. Stocks recovered 80 of the brexit losses. Barney frank and larry koud lud will talk about the brexit fears. We hear so much about the space race. Yuri milner with his eyes on the stars and funding projects searching for intelligent life through the universe. Has anybody looked for life . I hope not. Not seeing it in tv. I know that for sure. That was a joke. I know. Well hear from him later. 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Sixtyfive may get all the attention, but now is a good time to start thinking about how you want things to be. Go long™. All right. Tesla, more on this now. They have responded to this announcement by ntsa. What are they saying now . Whats most interesting, bill, is sort of the circumstances behind this accident that tesla the autopilot was engaged in. Heres what tesla says happened. Tesla informed ntsa about the incident immediately after it occurred. We know that the vehicle was on a divided highway with the autopilot engaged when a tractor trailer drove across the highway, perpendicular to the one that the model s was on. Neither autopilot or the driver noticed the white side of the tractor trailer against the brightly lit high and the autopilot brake was not applied. The high ride height, the tractor trailer, and the positioning across the road and the rare circumstances of the impact caused the model s to pass under the trailer so it passed under the trailer at right high speed. Its advanced crash Safety System would likely have prevented a serious injury but didnt take place. It went underneath the tractor trailer. Thats the circumstances regarding this incident involving a model s that was in autopilot mode. A fatality of the accident. And the failure, phil is the truck perpendicular across and the lighting . Right. Back lit or the sun . Well, thats what essentially theyre saying is that neither the autopilot, the eyes on the cameras on the car and the radar, nor the driver noticed the white side of the tractor trailer against the brightly little sky so the brake was not applied. Basically saying is that need a better camera. Not recognition of the radar, the camera or the driver. Sounds like an admission of failure by tesla, doesnt it . I dont know in a special circumstances. Yes. A human probably couldnt have responded that quickly and the sensors are designed to do just that. Except in maybe a circumstance like this. The point i was getting at is we had no idea about this crash and maybe theres something of human error. Now the company says, yes, okay. The car didnt see the truck. In an extreme circumstance i guess. Right. Right . Right. Thats just summary of it. I think we need to see the accident report, more of the investigative details of those responding to this accident scene. Beyond that, tesla says its cooperating and will work in helping them in their investigation. But, guys, that is the response from tesla at this point. Very good, phil. Thank you very much. We have a news alert on nike. Heres the details. Nike just now announcing that tim cook, the ceo of apple, appointed lead independent director of the board which is effective immediately. Keep in mind, cook has been nikes director since 2005. Hes also the chair of the Boards Compensation Committee and a member of the nominating and Corporate Governance committee. But again, the main news, nike appointing tim cook lead independent director. Well have to see, guys, if this leads to a stronger kinship between nike and apple going forward. For now, back the you. All right. Thank you. First blush . Well, i think the bigger news is chairman phil knight is retiring. Worked out a plan for phil knight . Parker has been running the show for quite sometime. This story is all about innovation. If they can Work Together to improve innovation, i think thats a good thing. What a Great American hero capitalism. Huh . Bill knight and nike. Absolutely. The value over the years. Fantastic. Must be tough for him to make this change, i think. Ahead, going head to head of the brexit and bill clinton and Loretta Lynch coming up. Row probably heard the flamboyant former london mayor johnson says he will not run for Prime Minister. After leading the charge to have the uk leave the European Union. That story, one. Story two, eyebrows being raised here at home on word that former bill clinton met with attorney general Loretta Lynch on monday. Which would not generate much attention except that lynchs Justice Department has an Ongoing Investigation in Hillary Clintons emails and discussed. Joining us now to talk about all that, barney frank, former representative of massachusetts and cnbc contributor larry kudlow, senior contributor, as well. Mr. Frank, what do you make of the meeting of Loretta Lynch and bill clinton . It was thoughtless. I dont believe for a minute anything improper either was discussed or could lead to it. The fbi james comey and president obama deserves credit for appointing is is a man of absolute integrity, a record of standing up to pressure and inconceivable to give in to anything. Also, i believe do you believe its inconceivable that bill clinton might not have tried to do something or influence her . Or at least ask some questions . Yes. I think its inconceivable because i think he understands that this would go nowhere with Loretta Lynch. But the fact is i think he may just not have been thinking about it. But Loretta Lynch, who i believe is a woman of great integrity, says it never came up. So, the premise of your question is was she lying about this . Ill leave aside what you think about bill clinton. He is a controversial figure. I believe him in this case. I dont believe for a minute that Loretta Lynch was lying and in reporting that nothing remotely connected to this came up. I believe she was telling the truth. What do you think, larry . Well, look. I agree with barney. I think jim comey is a powerful, tough cop. I have all the confidence in the world but theres stuff thats worrisome here. President clinton meeting with the attorney general lynch. Last night or late yesterday afternoon, the Justice Department files a stay or an injunction of emails between Hillary Clintons top staff people, four of them i believe, and any emails concerning the clinton foundation. Of which there were quite a few. Some people are saying that includes 34,000 emails. I guess the state department is going to do this. They want to delay of, what . 27 months if i have this story completely right. This is brand new. It comes a day or two after clinton meets with ms. Lynch at the very least theres some questions that have to be answered here. Are we to believe this is a total coincidence . Color me skeptic. Yes, we did. Hold on. We want to move on to brexit. I would like to respond to that. Go ahead, barney. This is part of a pattern of accusations about the clintons that almost all fail. Lewinski one didnt fail. I spent the 90s with three republican committees in the congress invest gatding whitewater and vince foster and the travel office and the fbi. Kenneth starr finally told the house, none of it had any substance. We saw the benghazi thing peter out with no serious charge proven. So, no. I do not think that Loretta Lynch, a woman of great integrity, prosecutor with unimpeachable record fiddled because bill clinton asked her to and, of course, somebody should ask her that. This is a different version of it. And i lets ask Loretta Lynch. Im sure shell deny it. Okay. Lets get to brexit because we are running out of time here, guys. The fact that Boris Johnson dropped out of running for Prime Minister, i mean, larry, you know, clearly, those in favor of brexit need to get their act together to develop some leadership to get this thing done, dont they . Im ready to go. They havent asked me yet. Im ready to jump right in. I call it mag thna carte 2. 0. The way i read it, michael gove is the guy to be Prime Minister. He actually was the intellectual force behind brexit. He has good relations with Boris Johnson on the one side and then on the other side so this could be a breakthrough. I wish that tories could get the leadership thing done this summer and i guess it waits until Early September and i feel overall, look, theres uncertainties. But i think you have got a twoyear period here to solve the issues, particularly on trade, finance and business. Cameron met and said he of course business will stay close to the negotiations. I just think that the negative economics here are really vastly overrated. Im not saying theres no risk but i just think its overrated. Mr. Frank, some people think that the brexit vote signals good things for donald trump. What do you think . I think the political figure donald trump resembles Boris Johnson. To do transatlantic analogies, not such a good idea. They could change hair and you wouldnt notice. But i dont think it means much about trump. I think these things are very different. They underline the failure of people who have been supportive of globalization which in itself is a good thing to understand that it has both good overall macroeconomic effects and unfortunate distributional effects and here and england and elsewhere theres policy makers failures to do better recently to offset that. And i think that is a reminder. Let me give you one lesson ive taken from this. I think its incumbent on the leadership in the congress of president to make it clear they dont try to get tpp ratified in the lame duck session. To enflame the anger of many people think is going too far and im one of them, push tpp through after the election and overwhelmingly opposed. Thats as good of an example of whatnot to do. Larry, i have to go. Larry, i got go. I agree with barney on the trade. Good. Well stop right there. Dont stop him from agreeing with me. Well let you duke it out later. Thank you both. Barney frank, larry kudlow joining us here. Up next, yuri milner reveals the latest plan in the space race. The first stock index was created over 100 years ago as a benchmark for average. Yet many people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Its time to bench the benchmarks. Kelly evans sat down in aspen with yuri milner and got his take on the space race and where we are in the investment cycle. Listen. The really big frontier is going beyond the solar system and trying to see whats going on out there. Specifically the nearest star is called alpha centary and we believe in the century we can step beyond the solar system and send a small robotic probe to nearby star. Thats so fascinating. Do you consider elon musk and jeff bezos to be part of the same team, or do you think you guys have separate or maybe even competing objectives . Not competing at all because we are separated by a lot of space, so so the solar system is big enough for a lot of people. Im pretty confident that the strong founders will be able to compete successfully even with Government Agencies in exploring the solar system, but i think also the same time the universe is much bigger than the solar system and were trying to trailblaze this completely new area. Probably the next stage will be building a prototype. How far are you from that phase, do you think in. Probably ten years. And then the ultimate goal is to build a system which will coast probably as much as the biggest scientific experiments that we have ever done, something maybe in the 10 billion range, comparable to speaking long term out here, about as long term as it gets, but i just wanted to ask, too, theres a lot of talk about investment cycles lately and whether the valley is, one, turning again and can you give us a sense because youve had a number of successful investments in past cycles. Where are we this time of around . I think were in an interesting place right now. On the one and i think macro trend is on our side. If you go back ten years there were 2 trillion worth of value created in Internet Consumer technology globally. Of course most of it in the United States and some of it in china and so it means that on average every five years theres 1 trillion worth of value created by those very powerful Online Platforms so we we project that this trend will continue without acceleration but in the linear fashion that on average in the next 25, 35 years every five years there will be another trillion dollars created. Thats good to know. Even better would be, okay, which are going to be the next companies that will be the successful ones. Any sense of where capital will find its best returns next . Well, first of all, we have confidence that there will be new companies because, again, historically, if you look ten years back, 40 of that 2 trillion was created by new companies and 60 accrued to new companies, so if even if this ratio will shift a little bit towards already existing companies, still significant value will accrue to the new ones and it looks like every generation is capable of creating this significant breakthrough businesses that become, you know, 100 billion and more. Well, hes got lofty ideas not only about going to the universe about how much value can be created every five years. And to be honest, i think if youre an existing company, thats exactly what scares you, right . A tremendous percentage of future growth is going to be owned by companies that are just now coming into existence which dont exist, and i think this is one of the puzzles of the investment. People complain about Mature Companies buying back stock and not researching because they dont see the ability of themselves to be the innovators that create the value. Its a mismatch between who has the cash and the new ideas. Coming up, more on apples move to lead tim cook as its lead independent director. Stick around. This man creates software, used by this bank, to protect this customer, who lives here and flies to hong kong, to visit this company that makes smart phones, used by this Vice President , this little kid, oops, and this obstetrician, who works across the street from this man, who creates software. They all have insurance crafted personally for them. Not just coverage, craftsmanship. Not just insured. Chubb insured. Big afterhour session for nike which named apple ceo tim cook its lead independent director. Cook has been serving on nikes board since 2005. The big news, of course, is phil knight retiring from the position. Becoming chairman emeritus and taking another step back. Whats interesting, tim cook is rolling apple. This at nike and 10 of the Dow Jones Industrial average, this guys got a pretty big say in whats going on. Thats an enormous amount of work, isnt it . You would think. To one apple and to be on two very different important forums. I worry about that. And as an apple shareholder he does have a lot to do right now. I think that its actually interesting though because they are putting more consumer people in nike and putting more consumer people around them and more technology and thats really where this is going. Nike is probably right behind. I want sneakers that tell me how far ive worked. See you tomorrow. Stephanie, enjoy the College World series. Private joke. Now that i know the answer. I dont know whats coming here, but that is closing bell. Its time for fast money with a very special host tonight. Lets see who it is. Surprise. Fast money starts right now. Live from the Nasdaq Market site overlooking new york citys times square and also partially from ec headquarters, dont adjust your screen. Im sue herera making my fast money debut. Melissa lee is stuck in mean traffic in new york, but she will be here in just a few minutes. Our traders on the desk are tim seymour. Hi, sue. Hey, tim. Karen finerman, steve grasso and guy adami. Hi, sue. Hey, be gentle. Tonight on fast, hersheys to monday lease, kiss off, but another consumer staple giant could soon be taken out. Well give you the name the traders are betting on, plus, tesla plunging