Transcripts For CNBC Squawk Alley 20160713

President and ceo walter isaacson. Great to have you on the program. Great to talk to you again. Our top story will be this. New privacy concerns surrounding pokemon go and its creators. Some are calling out the company for collecting massive amounts of player data. In a letter he writes im concerned to the extent which niantic may be unnecessarily collecting using and sharing a wide range of users personal information without their consent. The games creator released an update adjusting how much data it actually has access to but clearly were in the opening innings here of trying to understand the social regulatory, political consequences of augmented reality. Exactly. I mean, here in aspen yesterday all sorts of people wandering around there and of course youre using it and its collecting your data and also collecting all of your google data. Thats a little bit much. One of the wonderful things about it is it will inform us and make us think more about what data we want to block and what data we want to share because it makes the game more fun. We also want our right to share data when we want to. The massive overcollection of google data and getting access to not just basic information and when people wanted to play pokemon, it raises the question do there need to be selfimposed regulation and do there need to be even beyond that a federal regulation protecting consumers from having their information sucked out by these companies because we know they can be hacked and then when that happens, oh my goodness. Id rather have you regulated than trying to have it be done by congress. Id rather have us discuss it. If im searching around here for pokemon characters and no longer automatically by default open up my google data. So a little bit of an out cry and a little bit of a fix. Thats the way the world should be working but i do think we have been here at the conference and this pokemon thing in my opinion you talked about at the last hour is a bit of a fad and after awhile youll get tired. Hopefully they build it into learning apps so you can take lessons but use a great game and education tool that teaches you how to computer code but you can win pokemon things. I think the gameification of learning is more important than of pizza parlors. New comments this morning where you are. Over why you called off a donald trump event at his home last month. He invited a small group of people to meet with a nominee related to tech. Once he got word it was being turned into a fundraiser he cancelled and took to twitter. We are interested in engaging both campaigns in open dialogue and issues in technology. What was the response like there walter and how are ceos supposed to operate in this hyperpolitical year. Well, adam asked him the question, he walked it back well. Its a very you have the right question just now. Its a hyperpolitical year in which people are really torn and passionate and i must say without trying to be partisan myself its mainly about donald trump. If youre a Major Corporation and you seem to be supporting donald trump a lot of your workers and your customers are going to be inflamed about that and, you know, its not usually the case in president elections that people get so inflamed about one particular candidate. Were already in an environment where companies decided to take sides on certain issues. Weve seen apple weigh in on same sex marriage and salesforce and other companies, paypal on state legislation. Where is the line for companies on how far sponsorship of an issue should go . Well, my own opinion is that companies and corporations have a certain goal thats both to be good citizens of this country, good citizens of the world and make a return to shareholders. Something that effects their work force such as same sex marriages or for that matter even the comfort of work forces if theyre going to deploy a facility in North Carolina it probably makes sense for them to weigh in on it. Im not sure im that comfortable with corporations just randomly becoming political for no apparent reason. Weve already seen that in the environmental and green space and i think, you know, we walk the line pretty carefully in this country and im not particularly worried about corporations crossing the line. I think they have a right, people at corporations and corporations themselves have a right to push for certain types of social policies. Walter, do you have a sense of whether this was naive or miscalculation on intels part about what to expect from this event or whether it was over aggressiveness on the trump campaigns part turning this into something that it wasnt initially intended to be . It seems like it was probably both but frankly i do not have any inside information on how much the event changed from here to there. I know it probably did have as you would say in the military, Mission Creed that began with q and a but does show the flashpoints especially around trump that happened in this election season. Finally walter, shares of amazon, record highs again. The Company Reports Second Annual prime day was the biggest ever surpassing last year by more than 60 worldwide. Prime is now the latest ecommerce innovation created by bezos and we keep having this conversation about his ability to be entrepreneurial at scale but at what point do you worry about him having too many irons in the fire . I dont seem to worry about him at all. Back in 1999 when i was with time we made a man of the year and i thought okay at some point this will burst. He has been the most brilliant entrepreneurial and hes been like lets create a shopping holiday. Who knew in the middle of july we would surpass almost every day of the year as a shopping holiday. Thats something that helped amazons products. Here in aspen at the institute one of the people from amazon got off and showed off the echo machine. A lot of people buying it here on the campus. It is a whole new way to have a user interface. Theres whole new ways of doing business that have been invented by jeff besos and im blown away by amazon and amazon is still creeping up to record highs. They can come out and say it was the biggest ever and sales up 60 and thats like netflix saying the premiere of a certain series is the biggest ever but still declining to give any ratings or viewership information. The hundreds of thousands of kindles and fires and amazon tvs that were sold in the past two days, that really does imbed people into the amazon environment. Maybe its a little bit overhyped and you may be right. The numbers arent fully there but when i looked at the numbers that they put out i went wow doubling tripling from last year. You keep on this trajectory. Amazon invented something new which is prime day which i had never heard of a year ago. Walter, what does it say about amazons cultural relevance. This reminded me of Montgomery Ward creating rudolph the red nose reindeer and Department Stores turning christmas into something it hasnt been before. Are we in another zone like that with ecommerce and amazon and what does it signal about where it goes from here. That could be for the good. You look at the core of the cities. Shopping has become a fun entertaining experience rather than where you just go for the serviceable item but look i come out here to aspen and im running out and i just go to amazon and it gets delivered and when we have much more natural user interfaces our line is doing it to ipo today. We chat happening in asia and the messaging apps you can use a buy to shop naturally with conversational tones. And conversational approach to the Company Using alexa with the amazon echo. All of these things are going to change the nature of shopping. Walter, knowing what we know about entrepreneurship its great to get your insights today. Always loved having you. Thanks so much. We have to apply some of that to educational and learning technology. Thats what we have been talking about here. We look forward to hearing more about it. Its been a great week for you already. The markets at this hour are little change. The dow and s p 500 setting intraday records at the open but still mildly in positive territory. And denying the bank of japan would pursue helicopter money and of course the bank of england meeting tomorrow and that of course is against the backdrop of the u. K. Today getting a new Prime Minister. Pandora is moving higher and upgrading from overweight to neutral citing improving Profit Margins and high hopes for the new on demand platform. That was put in place last week after three died in that trial. Shares are up better than 16 . Stocks still trading in record territory. The best places to find hidden value. Its also the biggest tech ipo of the year. Details online after the break and materials trading at the highest level in more than 12 years. Well talk to the ceo in a first on cnbc interview later this hour. Your Business Needs Better Technology to drive better performance. So you need it to be reliable and fast. Really fast. Introducing the comcast business Summer Savings event. Fast Internet Speed to drive performance, plus cutting edge wifi for your employees and customers, and voice mobility so your calls find you wherever you are. Get some of our most advanced products at a great price with over 500 in savings. Call today and ask how to get these savings plus a 250 prepaid card. Comcast business. Built for business. The dow and the s p 500 hitting record highs again this morning but they paired gains since the open. We are open on track 4 a 4th day of gains for the dow and the s p. Joining us is john sweeney. Executive Vice President for retirement and investing at Fidelity Investments and the cofounder and managing partner with mayflower advisors. This is being called a relief rally but people are worried this is again Short Covering all corporate buy backs. Who is in there buying . What is this . Three different types of investors. One theyre seeing solid employment and getting raises as we saw from some companies yesterday so theyre putting money to work regularly in the market in their 401ks. You have them looking for yield so theyre stretching and buying equities and you have the traders stepping in post brexit when you have an Inflection Point and theyre putting cash to work. The drive toward stocks is continually fuelled by central banks. The fact that is u. S. Is the best house in a bad neighborhood. Central bank sentiment can turn on a dime. How sure are you that this is a reality that can sustain itself . You make a great point. With the dow and the s p at all time highs you would think investors would be jumping for joy but theyre not because most investors saw that as a post brexit holy cow the strategists for wrong, im underinvested but the fed has my back rally. On this network ahead of the jobs report that was the most important piece of Economic Data because that may have kicked off a rotation in the market. Into a broader mandate out of some that investors have been hiding in but theyre no longer providing the reward. Its a healthy action that were seeing in this rotation but rotations can be nasty and they can be fierce and investors are poorly positioned for that rotation in the market that were seeing right now. The morning after the brexit vote i sent my mom and dad a text that said dont panic sell anything and they hadnt seen the news yet but for the retired investor and they are retired as many of our viewers are, have any of the rules changed . Many have to be confused. They want to protect their assets. Theres a lot of volatility and they cant go into Interest Rate bearing things anymore. One of the things we get retireee to think about is youre planning for a 30 year retirement. You want to make sure that you outpace inflation. I cant lose any principle so they go 100 to bonds and 100 to cash and even for a 65yearold you want to be looking at 60 equities. The bonds are providing stability so in this Interest Rate environment bonds will be that balanced in your portfolio and then two years of cash in the money market. Same old rules of thumb. Nothing has changed . Stick with the plan. Stay with the course. Four capital launches tomorrow by the way. Sure. I would also add that if you look at investor portfolios this is a time to rebalance the portfolios. Investors are comfortable hiding in those games. Its easier to get a gun out of an nra owners hand than a dividend stock out of a portfolio now and this is when you want to start looking at the areas that lagged the portfolio and opportunity going forward. If this portfolio is going to have Growth Opportunities and the rally is going to have legs, 19,000, 20,000, were going to see a rotation in that portfolio. This is the time to do it if you believe you can have that rally and thats what investors should be doing at this moment. But stocks cant go up forever. At some point, the hold forever thesis goes away and there does become a smart time to sell. European officials think they can avert an italian banking crisis. Is november the biggest risk out there. You said time to sell. Theyre providing dividends and hopefully producing some growth so you want to hold on to them for those reasons. Look at them as tools in your portfolio that are generating growth depending on what stage of life youre in so the question about selling comes down to timing if you think you can go in and out of the market when theres a period of volatility like we saw last summer with china. Like we saw in february with oil and like we saw last week with brexit. Thanks to both of you this morning. Thanks. Meanwhile, messaging app line set to list on the tokyo and New York Stock Exchanges the tomorrow. The company will raise over 1 billion in what is going to be the biggest tech ipo of the year. Bob is here at the New York Stock Exchange with more. A lot of excitement about this and let me explain why. First, heres the basic facts of whats going on here. This is the japanese messaging app. Its pricing toward the high end of the range. 3300 yen right now. Thats about 33 here. Thats very interesting and its unusual in that its pricing in tokyo and new york one day later. One third traded in japan and 2thirds of the New York Stock Exchange. This is going to probably trade up. Let me explain why exactly here. First its priced at the high end of the range. Secondly theres a lot of retail interest in japan because its very wellknown. Its a messaging app in japan and theres something very unusual about this. Were playing by japanese rules here. Trades on thursday in new york. Friday in tokyo so theres a three day period where you have market risk. So the nikkei has been trading up this week so thats likely to give some to the stock and also theres a three day period here where its not trading but its priced theres a market that developed in london on the stock. Its not here. Its illegal to do that here but in london theres reports that the grey market is trading higher over there. Well be talking about this tomorrow with the head of the New York Stock Exchange right outside the post discussing the new ipo. A big ipo on friday and thats another one we keep an eye on that next day. Back to you. All right. Exciting to watch. Thanks bob. When we come back a first on cnbc interview with gar garydickerson. When squawk alley returns. From augmented Reality Mobile Games to google vr and solar and display Technology One thing they all have in common. Not trading at levels since november of 03. Larry joins us from San Francisco at the west conference as it kicks off. Its good to have you with us. Good morning. What a period were in in terms of new technology making its way to the mainstream. Especially on a week like this. What it means for Companies Like yours. This is a really exciting time at Applied Materials. We Just Announced last quarter 3. 5 billion. Record earnings, 25 above our previous record. And what is driving our business is were in the early innings of some big multiyear waves. Memory technology is changing more than it has in decades. Especially the growth and right now our customers can sell every device they can build. Biggest change in Memory Technology in many, many years and really the key thing for Applied Materials is our total available market goes up by a factor of 3 and its material innovation. And its driven by dimensions and now theres innovation with materials and and in the third dimension and its all about materials innovation were applied at the worldwide leader so thats one big multiyear wave where were in the early innings. Can you and youre able to move out of the way and it seemed to be bad for you, pc sales declining. Smartphone sales maturing and yet the change overs in Technology Behind some of that stuff is enabling you to still move forward and also have new markets. How much legs does that have given the fact that some of those end user products that traditionally have been important for you are not growing the way they used to . Yeah, so yeah, you have these multiyear waves and were in the early innings. Memory Technology Changing more than ever. China we doubled revenue over the last two years. This year will be over 1. 6 billion in china. China will continue to grow and and multinationals and both in semiconductor and the display. And going up a huge amount and maybe double again in the next three years relative to investment and the third multiyear wave that were riding is the introduction or the growth of organic led displays in mobile devices. And really, were still in the early innings of the adoption into mobile devices with organic led displays and this is really one thing that sets it apart because applied is unique in this enabling of these displays. We have extremely high share. We had record orders in display and were in the early innings of all three. Memory technology, china and display inflections that are really great for Applied Materials. There are still people that try to argue or end this lull, a valley of sorts in between big Product Innovation errors when you look at whats happening with the phone. Were having to wait longer for big advances. Desktops we all know the story there. Why is that wrong . Again. Relative to Memory Technology, actually im very, very bullish. If you look at the new devices. It will drive the cost down and drive more adoption of these kinds of devices. The performance of the new Memory Technologies are significantly better so longer term i am very, very bullish on Memory Technology as a growth driver and especially in these inflections that are great for Applied Materials. China is going to continue to invest a significant amount. They announce a 100 billion investment in a semiconductor entry and i believe were in the early innings of this change and for all of us, the visual experience is one of the big factors in what devices were going to buy and theres still so much innovation thats going to happen in the display that, again, these areas are going to be incredible growth drivers. And then if you think longer term, you look at what are the drivers for our industry . Artificial intelligence, virtual and augmented reality. Big data. Iot, there are just really tremendous innovations where were working with leading Technology Companies where theres phenomenal opportunity for growth. Well, certainly this stock and its performance over the past few years reflects some of that promise. Good to see you. Thank you so much for your time. Thank you so much. Thank you. Europe closed about 60 seconds ago. We do have a developing situation at the United Kingdom. I want to show you a live shot at downing street and David Cameron will emerge to travel to Buckingham Palace and tender his resignation as Prime Minister. And teresa may will be asked by the queen to form to become the next Prime Minister and then to form the next government. And meantime european markets actually losing ground. We hit a two week policy and some of these markets are turning red as you can see. Important to understand you might be here on wall street and youre down some 15 from the highs we have in 2015 in europe and you still are at a depressed state. As far as the u. K. Is concerned, maybe theyll find out who the next finance minister will be over the next 12 hours. We also have a bank of england meeting tomorrow. Sterling managed today and since the brexit vote. The bank of england may close rates tomorrow and they may also go into buying Corporate Bonds as part of qe. And thats by no means confirms. You see were losing grounds as we work our way to the end of the session. And rally for four days and the big focus is what is happening . Italy and Angela Merkel said there were talks between the italians and the rest of europe about how they can watch a rescue operation within the italian bank and stress tests there that are coming through on july 29th. Most of these banks have fallen away with the exception of arguably the most difficult monte paschi thats higher though its looking at a mass security deal, maybe 30 billion of nonperforming loans. A very big deal that its trying to involve much of the Financial System up there. So guys thats how we are in europe. Back to you. Simon, thank you. Simon hobbs here at post 9. Still to come on squawk alley, pokemon, privacy and augmented reality. The former ceo of Electronic Arts will join us to discuss. [announcer] is it a force of nature . Or a sales event . The summer of audi sales event is here. Get up to a 5,000 bonus on select audi models. David cameron getting ready to exit 10 downing for the last time on his way to deliver his formal resignation. Delivering a statement in a few moments but having already had a very busy day addressing parliament for the last time. The movers at 10 downing urging teresa may to although she has committed obviously to making brexit happen, staying close to the eu for as he said cooperative trade and security reasons. A breathtakingly quick change of leadership in this country. Well, who would have thought . When did we have the referendum . Less than three weeks ago. There was a calculation that cameron could have lost that referendum but they have lost it and then of course for the out campaigners to have moved to one side in the Leadership Campaign for the conservative party so that that was shortened by 8 or 9 weeks and therefore there wont be a new Prime Minister today. A lot of surprises. Hes having to move very rapidly. Teresa may of course has a number of very difficult decisions to make. Indeed and is already being compared to thatcher in many ways for her occasional ruthlessness and efficiency. This morning wilfred frost said if thatcher was known as the iron lady teresa may is being called in some circles the steel lady. Wilfred frost joins us this morning from london. Wilfr wilfred. We are waiting for Prime Minister David Cameron to make his final fair well. He is expected to be accompanied by his wife samantha. And his three children. It will be his final point to leave 10 downing street as you already discussed. In parliament he said i will miss the roar of the crowd referring to contests in parliament. He said he was willing all of his fellow politicians on and said in the end the Public Service and the National Interest is what its all about. Nothing is impossible when they put their minds to it. Thats some of his words in parliament. His final Statement Due any moment here at downing street. At the age of 49, Prime Minister David Cameron is the youngest Prime Minister to depart office for 121 years. The last one to do so. And at the age of under 50 and his successor, 10 years his senior, teresa may is 59 and she will be coming of course later today and make the short trip, 2 or 3 minute drive to Buckingham Palace. Hell go down to Buckingham Palace offering his resignation to her majesty the queen. The Prime Minister has been the 12th Prime Minister of Queen Elizabeth ii. Only one female Prime Minister among the 12 so far. Later today teresa may will become the second female Prime Minister of her reign and indeed of u. K. History. We await Prime Minister David Cameron now. Most of his staff are here as well so his arrival is expected any moment now. Of course, this will be a sad occasion for him as well as a historic one and momentous one. We are awaiting him any moment now. Back to you for the moment. The political change over happens right now but many issues still need to be sorted out. Obviously brexit means brexit and well make a success of it. She is in charge of the countrys divisions although she will not envolkswagen article 50 this year. When i first stood here at downing street on that evening in may 2010 i said we would confront our problems as a country and lead people through difficult decisions so that together we could reach better times. Its not been an easy journey and of course we have not got every decision right but i do believe today our country is much stronger and with a deficit cut by 2thirds, 2. 5 million more people in work and 1 million more businesses theres no doubt that our economy is stronger. Politicians like to talk about policies but in the end it is about peoples lives. I think of the people doing jobs that are previously unemployed. I think of the businesses that were just ideas in someones head and today im making a go of it and providing people with livelihoods. I think of the hard working families paying lower taxes and getting higher wages because of the First Ever National living wage. I think of the children who were languishing in the care system and who have now been adopted by loving families. I think of the parents now able to send their children to good and outstanding schools including free schools that simply didnt exist before. I think of over 200,000 young people that have taken part in service. The fastest growth Youth Program of its kind in the world. Something that again wasnt there six years ago. I think of those that have been able to get married that werent allowed to in the past and i think of the people on the other side of the world who wouldnt have had clean Drinking Water a chance to go to school or be alive were it not for our decisions to keep our promises to the poorest people and the poorest countries in our world. We used our stronger economy to invest in our health service. When i walked in there there were 18,000 people waiting over a year for their operation. Today its just 800. Too many, still too long. But our nhs is a National Treasure from one that staff performed miracles as i have seen every day. And we have strengthened our nations defenses. Its submarines, destroyers and soon aircraft carriers rolling out of our shipyards to keep our country safe in a dangerous world. These are the choices and the changes that we made. And i want to thank everyone that has given so much support to me personally over these years. The Incredible Team at number 10. The Civil Servants whose professionalism and impartiality is the greatest strength and my politic advisors. I want to thank my children, nancy, elwin and florence for whom downing street has been a lovely home over the last six years. They sometimes kick the red boxes full of work. Florence, you once climbed into one before a foreign trip and said take me with you. Well, no more boxes. And above all, i want to thank samantha, the love of my life. You have kept me vaguely sane and as well as being an amazing wife, mother and business woman, you have done something every week in that building behind me to celebrate the best of voluntary service in our country. We will surely be heading to Buckingham Palace to see her majesty the queen where i will tender my resignation as Prime Minister and ill form a new administration. Im delighted for the second time in british history the muscles Prime Minister will be a woman and once again a conservative. I believe she will provide strong and stable leadership in fulfilling the conservative manifesto on which we were elected and i wish her well in negotiating the best possible terms for britains exit from the European Union. Let me finish by saying this, the spirit of service is one of this countrys most remarkable qualities. Ive seen that service day in and day out in the incredible work of our armed forces, our intelligence agencies and our police. It is something i always knew but as Prime Minister, you see it so directly that it blows you away. And writing the heartbreaking letters to the families that lost loved ones is a reminder of the profound scale of what these men and women give us for in the defense of our freedoms and our way of life. We must never forget that. In a different way ive seen the same spirit of service in the amazing contributions of countless volunteers in communities up and down our country who are making our society bigger and stronger and im proud that every day for the past two years i used the office of Prime Minister in a nonpolitical way to recognize and thank almost 600 of them as points of light Whose Service can be an inspiration to us all. For me politics has always been about Public Service in the National Interest. It is simple to say but often hard to do but one of the things that sustains you in this job is the sense that yes our politics is full of argument and debate and it can get quite heated but no matter how difficult the decisions are, theres a great sense of british fair play. A prevailing sense that most people wish their Prime Minister well and want them to stick at it and get on with the job. So i want to take this moment to say thank you to all those that have written letters and emails offering me that support. People who ill never get to meet and never get to thank personally. It has been the greatest honor of my life to serve our country as Prime Minister over these last six years. And to serve as leader of my party for almost 11 years. And as we leave for the last time, my only wish is continued success for this great country that i love so very much. Thank you. [ applause ] David Cameron, with his family, announcing his resignation for the last time and one of the more concrete examples that we have seen so far from the brexit vote. Yets, its worth bearing in mind that David Cameron took a big gamble that ultimately failed. There will be some smiles among those that would like to stay in the European Union and the rest of the eu when he talks about Public Service being in the National Interest and thats the basis of politics. As the former italian priel minister told this show it was a selfish decision for the sake of his party and to win the general election but they offered the people of the United Kingdom a referendum on eu membership in the first place. Thats a huge taboo because you often get a protest vote and thats exactly what has happened here. This is a country thats in a state now of political crisis. Maybe she can walk them back from that but i dont think that anybody felt we would be in this position three weeks ago. Even the people that campaigned to leave the European Union were not prepared to step up to the plate and to deal with the aftermath of that vote actually going through. Were going to watch this obviously now. The attention will turn to teresa may that will move into 10 downing tonight. She will. And for a leader thats not known for generous appearances, public statements, twitter chatter, how she communicates her plan for the next six to 12 months. She was at the home office and she remained there for many years. Its a difficult position. She kept her head down and did the job and its safe. The current foreign secretary, who knows if you will be reappointed tonight. The brexit could take up to six years. And let me also point out were talking about teresa may being the second former Prime Minister in the u. K. It was internal divisions from the conservative party that meant that market thatcher was kicked out by her own party 26 years ago and its as a result of those divisions within the party that now you get a new woman coming through. A woman who previously worked for the bank of england that has a meeting tomorrow. Wilfred frost, youre reflections as we watch camer camerons motorcade work its way through the streets of london. Absolutely right. On the way to Buckingham Palace to offer his resignation. Speaking moments ago he described his tenure as Prime Minister as the greatest honor of his hief. The politics was about Public Service and National Interest and thanked the british people for giving him a chance to play a part in that. He also of course thanked his children who were along side him. Those were nancy age 12 and florence and he thanked his wife samantha for her support describing her as the love of his life. As we know he is making his way now toward Buckingham Palace to offer his resignation to the Prime Minister. He will advise her imaginemajes queen to invite the next Prime Minister. Someone he said would deliver strong and stable leadership to this country. So historic times here as the Prime Minister makes his way to Buckingham Palace having made his final statement outside the houses nine, thanks so much. Dow down about 28. S p down about 5. Back after a short break. If youre just tuning in this morning, outgoing uk Prime Minister David Cameron exited 10 downing street addressed the media for the last time, now on his way to that place right there. Buckingham palace tendering his formal resignation to the queen, and weve been watching this and talking a bit about what theresa mays tenure may bring in the months ahead. Cameron statement focusing largely on the economy as hi legacy is written now that hes left the Prime Ministers office, talks about cutting the deficit, creating jobs and businesses, in his six years as Prime Minister, but as simon mentioned, perhaps his legacy will be defined by the political miscalculation that britain would stay in the European Union. Definitely a roll of the dice. Cramer pointed out, uk economy doesnt look bad compared to the other large economies in europe. With all that, get to the cme. Rc rc hick santelli has the santelli exchange. Doesnt look bad at all. Look at all the breck it doom looks in relative terms pretty good is right. Stick with this, because in many ways, what brexit vote did was turn up the heat, and when you turn up the heat, the kinetic energy, everything moves faster, the molecules, shake, rattle and roll. That is important for todays exchange, because fear of lower and negative rates really reached a crescendo last week and part of that was brexit, how certain markets whether it was the ftse, recovered or other markets like tguilds or jcbs or ecbs even in the u. S. , historic negative rates, threw in that wild jobs friday, and what you had was, and this really is interesting, because minutes before we went onair i received this chart. I get a lot of research. This happened to be from s p bank of america, merrill lynch. It fits so well. The percentages of stocks with dividends above tenyear yields, and the chart starts in 85 to today. 60 is the threshold. Were getting very close to that. So the fear caused a surge. You know, its fear and greed. Isnt that what moves market . Thats what moves life. You can change those words to different proxy words, but it all means the same thing. But what were really trying to define here is whether that surge here, the surge in stocks, another channel of buoyancy based on monetary policy, is that going to continue for stocks, or more importantly, does that mean the end of the big drop in rates for the fixed income side . On the latter, i cant tell you. What i can tell you is this we seem to have carved out top of range in many sovereigns but i wouldnt deny the notion there could be a lot more selling considering everything person i talked to in fixed income says theres only one direction. Here or lower rates meaning higher prices. That never works out. Kayla, back to you. Thanks, Rick Santelli in chicago. Of course, rick pointed out the fact that a lot of s p 500 companies are trading with their dividend yields above the tenyear treasury. About 82 o s p 500 Companies Currently trading above their 50day average. A rich valuation. Weve gone negative on averages following the european. Dow down and s p down and nasdaq down, and s p and the dow earlier today, carl, set another intraday record high before pairing those gains. And oil didnt help, of course, which remains down about 2. Though inventories numbers had a slightly smaller than expected draw. A short break. Back after this. Our markets coming off of those intraday highs they set yet again. A big night taking shape for tonight in terms of earnings season. Csx and results and a couple day process of getting inflation data for the u. S. Bank of england, cut rates for the first time . Buy Corporate Bonds. Exactly. And a reuters poll showing a lot of people expect exactly that to happen. And line ipo as well expected to be in the billion dollar range. A big deal for the ipo market, and for people watching messaging and social. A lot of tests to get through over the next 48 hours. Over to the headquarter, the judge and the half. All right, guys, thanks so much. Im scott wapner. Right to a story new at noon today, and a big one at that. It looks like former valiant ceo Michael Pierson unloaded much more of his Company Holdings than originally thought. According to filings i have in my possession, mr. Pierson sold nearly 5 million shares and in the money options for a total of 96. 8 million in recent weeks. Whats even more interesting, of course, that im learning of all of this on the same day that the sequoia fund revealed it is completely out of that stock. Sequoia, you may, at one time the largest valiant