Relationship. The compatibility of the dna troubles me. Youre an expert in molecular biology. I didnt even take it that far its just the whole idea. Lions and tigers dont go together. Frog thats this big how do you know . Structurally it makes it very difficult. I go back to the bee movie. I dont know if you saw when a woman fell in love with a bee with Jerry Seinfelds voice. That was not going to work. The husband was jealous and the woman was those cross species things dont work, as you know maybe you dont know. Lets get to our top story. The markets getting set for the opening act. Where did you grow up . Fridays jobs report is the big deal but today we get the adp employment report. This is the gauge of private payrolls expected to increase by 215,000 for the month of july. That is down from 237,000 hosted in june. Checking on u. S. Futures they suggest a positive open. S p by more than 4 and the nasdaq by more than 12. Jobs will be one of the many big topics well tackle later this morning with Federal Reserve governor jay powell. That exclusive interview kicks off 7 30 a. M. Eastern time. Do we have you to thank for that . No, we have the southern company. Oh, okay, good. Weve had him on before but i believe, joe, this is the first time a Federal Reserve governor sat on the squawk set. So as is every day we will make additional cable history today. Fantastic. Isnt that great . Who was that . Lockhart . Yesterday. Unless something really changes. Right. So the ipo would be he dissuades him but excuse me quarter point. I was on the set yesterday. So Interest Rates will be a quarter point. No, actually, they will be 37 basis points. Its something you have to get a little bit used to. With china now . No, so you have to get used to this. Im worried. People are waiting for it. When you come here the current fed funds rate is like 12 basis points. When the fed moves it will move by 25. 2512 is 37. 2537, theres no difference. Its almost 0. Okay. Well discuss later. Disney, actually i was just just dont ask me any questions, okay . Im looking at the chart of disney. A three or four year chart versus the s p. Any of those charts versus the s p. Its going to look good, right . Its just going to tell the story that obviously cord cutting, the daunting future that all media companies, especially cable that theyre facing now that needs to be managed, none of that is new. So today were going to have a pull back and lets keep it in perspective. Disney shares taking a big hit. Magic king tom with 1. 45 a share. Revenue slightly below at 13. 1 billion. The company also lowered its outlook some what based on the strong dollar and the impact there on revenue but along with declining subscribers at espn and other things. But the rest of the cable operations continued to show gains. Its difficult now. They had previous deals set up and they get paid for on demand switches. But people obsess about one thing, right . And rich greenfield was here the other day and he was obsessing about this one thing. And he says we are going to see things like this happen but its not going to be dramatic over the next five years in his view so probably no over the top thats the reason the stock sold off, right . They said yesterday were not going to do that . No, this was a decline in espn and it speaks to the whole question of its not new. I know. But theres a question about whether they face this threat of people abandoning them. It was the same day that netflix well see how that all works out. I took off one day for my children when they were born. A guy can take off a year. For the babies. When they have a baby . Netflix was up huge. But thats a private sector decision. Yeah. Thats what they want to do for their people. God bless them. But i think it was up yesterday because they got their plans together for japan. But a 50 murder in the Second Degree market cap. Taking market cap away from conventional media but add up conventional media and theres some market cap to take away. If you added comcast and disney and time warner then youre at almost a trillion dollars. Right. But you dont want to take it from comcast. No. But were at netflix, not to overstate it, its not 50 billion. Its not a zero sum either. No. I know people in my family who are watching more tv. On netflix. Because netflix is there. I go home and i asked my daughter who is 15 on netflix and i say so could you ever see a day when you didnt have any cable and she said i could see that now with netflix. And my wife and i were like no way. I want to turn on some cable. Thats the thing. But she says she would look at yahoo something or other if she needed use. I said what if you needed this and this and this and she had an answer on the stupid internet for everything but for me its not going to be satisfying. Their anchor to the cable box is Sports Center and the only other reason they turn on cable is to watch now, we watch the yankees and the mets together but i think thats it. They dont have another connection to the game. Are they watching on a small screen somewhere . No, no, the typical way my kid watches television is with his computer in front of him. Thats awful. Theres actually three screens. Except for the two day fomc meeting when youre on. Are you kidding me . Yeah, dad, we watch, sure. They think its cool when the golfers come in. Disney chairman and ceo bob iger will be appearing on squawk on the street at 9 00 a. M. That will be a must see interview. Just to hear him and i dont know whether he was booked before the stock was down 7 or 8 . Do you know whats now telling . Think about what he said when he was here and he already knew all of this stuff, right . And when he says eventually espn does go over the top. Think of disney and what an incredible diversified with the theme parks and with the movies and star wars, its still 46 of the operating income or whatever. Chief Investment Officer and well start with ivan. You were a Financial Advisor when you had the hair cut. You went all the way. You shaved your head. Now arent you running the firm, basically . Research and Asset Management. Running research and Asset Management and we said who could we get this morning that follows disney that can illustrate the success. The potential success of going all the way instead of half or grow it and put it joe, as i said, these are the last messages of a once thriving civilization. So are you ready to sell the stock here . Not at all. Its a huge buying opportunity. Im actually shocked its down but ive said you never buy a stock for what just happened. You buy a stock for whats going to happen over the next few years. Espn and cable is going to get harder and harder to keep in the sweet spot. Whats going to happen is they have the best Movie Library ever. The sweet spot in action and adventure. More billion dollars franchises and tons of movies to come plus action adventure produces the most licensing revenue. Youre never going to have a harry met sally action figure or lunchbox but the ability to license that content is unbelievable. The biggest segment is nearly 6 billion, 5. 77 billion. In studio entertainment is 10 million. The tv product is driving so much revenue. Youre saying the movies will offset. Movies will be the key driver. Movies also drives tv viewership. As bob iger said netflix is a partner not a threat because disney produces content. Netflix is a platform to consume content. So for me that goes hand in hand. Dont they also have 1. 5 billion people that havent been to disney land yet . Is that going to happen at disney shanghai . Eventually. Disney land is pretty cool, is it not . Absolutely. 1. 5 billion. Id like to have the disney brand and the ability to build one of those in china. And see your movies and watch your channels. Heres what i was talking about. Total revenue for disney was up and overall Cable Network revenue increased 5 even with the did dollar so theres a lot of companies that would be envious of 5 . Report said fifa had the world cup. I think heres the key thing with espn. Aztec nolg allows consumers to negate commercials some of the most valuable content will be news and sports. Plus sports has the most engaged audience. Both usually watching sports on tv and interacting over the computer so i think that espn is in the sweet spot. They get a penny for it, dont they . Yes. Its not like the sports is out there as low hanging profit. The competition is so intense. We see bidding wars every time. Yes because the audience that watches sports is so valuable. And how profitable is it to own the nfl franchise. Do they make a lot of money on that . Absolutely. And the soccer. When theyre not around theyre going to start showing hockey. You will eventually be able to see whatever you want and this is new for me but saturday on College Football season, you know the four guys they have at the school where theyre going to hit, i just turn that on by just automatically and prevent Something Else from getting on first and then it stays on and the game is that much more. Theres four other games theyre talking about or five other games i didnt know i was interested in. Its a really compelling i just wouldnt bet against it. You . You can sit there on a saturday and i think you can watch like seven different games with the other networks. So you would buy it and i mean, its a big market cap company. Disney, 10 or 12 years ago, maybe longer, but there was some questions. It was down in the teens. So its had a big run. You dont think that the i think it will continue. Think the tubts that exist ahead of them are tremendous. 200 billion. Whats lumpier . The movie business or the tv business . I would think the movie business . Yes. The possibility for hits or misses are greater in the movie business however their history of hits is phenomenal. Much better. Even cheaper movies to produce such as frozen and theres the nemo sequel finding dori coming out. It just remains relevant. Right but i would still assign a lower multiple because they can be far more consistent. Yes but when the movie revenue ends i think the star wars movie is going to be the first one coming out. They think its going to make some people think its going to be 2 billion. Yes. This is a powerful franchise and then the ability to reap other benefits off of that from theme park rides to merchandise is just incredible. You dont run out of those either. Its the whole universe. Amazing. You never run out of it. Anyway, thank you. I think theres some expectations but i think this is just going to be an unbelievable blockbuster and then theres a movie every two years coming after that. I cant wait. Good to see you. You too. Thank you very much. Lets check on the markets so far this morning. The futures suggest we will get a positive open despite what were seeing in disney. Dow open by 18 and s p higher by 4 and nasdaq by almost 12. As for europe positive across the board except for the Greek Stock Exchange once again. Gains of more than 1 in germany and france. Greece keeps going down because the banks go limit down nearly every day so you need another day and we keep waiting to see where the banks are going to find the bottom there. The limit down on the banks over there is 30 and they have done that now three days in a row. Japan, higher by half a percent. Same with hong kong and shanghai lower by another 1 and 2thirds . Brent Still Holding above 50 at 5031 and slightly positive. 10 year yield. Oh, 2. 24 if im reading that correctly and the dollar right now is stronger against the euro and yen but weaker against the pound. 108 euro for every dollar and gold is lower again by another 6. Look at the right side of the chart. That tells the whole commodity story right there. Lets look at stocks to watch in todays trading. Lumber liquidators taking a big hit. They lost 75 Cents Per Share for the Second Quarter. The company says its been hurt by allegations of the safety of its foreign products and cant yet estimate its outlook. Crafts website operator etsy lost for its Second Quarter. However the shares are under pressure because of etsys soaring marketing expenses. Video maker Activision Blizzard is 5 cents better than estimates and revenue was well above forecast. It also raised its forecast as games like call of duty. First solar earning 93 krcents r share. Swamping estimates with revenue above forecasts. The equipment maker also raising its yearly outlook. All sounded good. It did, didnt it . Did you see the stock though . No. It looked like oil. What you would figure. New overnight, the New York Times reporting a private Equity Firm Silver Lake invested a billion dollars in Motorola Solutions. Theyre looking to broaden its portfolio of emergency Communication Systems and pretty serendipitous. Chairman and ceo greg brown will join us at 7 40 a. M. Eastern. Same day that we had that news. See, fortuitous people confuse with fortunate and it means by chance. It doesnt have a positive context. If something is your fort. Its not forte . No, thats a music note. So much to talk about. Coming up, making the cut. 10 men will be taking the stage, donald trump in the middle of it. And several candidates left out in the gold. The Great Expectations of this first of several debates next and as we head to break, check out this day in history. 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There was some deliberation in when he chose to get in because candidates typically get a bump from their announcement and that bump is who moved him past rick perry. So the candidates weve got are donald trump, jeb bush, scott walker, marco rubio, rand paul, ted cruz, mike huckabee, Chris Christie has also made the cut. He was somebody who had been on the bubble but he said he wasnt worried at all. Were going to make it. He did make it. Now dont necessarily write off the candidates that will be in that jv debate. They still have a big audience. So rick perry is going to have a chance to have a moment. Carly fiorina will have a chance to have a moment. The only woman in the republican race. Theyd like to have her in the main debate to try to advertise the diversity of their party. Lindsey graham and rick perry have been making the most antitrump case. They will have a chance to do that in their jv debate and, you know, this is just a first so we have a ways to go. I dont want to defend the kind of back room, cigar smoke filled political meetings where they sort stuff out but when you have 17 candidates arent some of the Party Operatives supposed to sort some of this stuff out . States exhibit it a sign that something isnt working in the two party system . I can get my brain around five but 17 tell mess that somebody hasnt made choices somewhere. Well, you know, the entry in a president ial race have gotten low. This is an extraordinary field in my experience. Because you have candidates who are serious politicians that had legitimate political careers who it is very difficult to see what their path is to the nomination. Yeah but jim gilmore was the republican governor of virginia. He ran in 2000. Didnt make it. And now its the fantasy that you do something or Say Something that strikes a cord. I think its positive. Who cares. Theyll be gone. Theyll be weeded out quickly. Whomever. Theyll be weeded out quickly and i dont see it as a negative at all. Its great. Most people on that republican side say we have a strong stable. Republican say what a strong stable of guys that have done actually some governing. A great bench with a lot of diversity by the way. No, thats true. Theres more serious politicians in this field that have a legitimate claim to leadership than we have seen in recent fields. So im not criticizing the field. What im say as good that jimmy carter and bill clinton were in much different positions. Jimmy carter wasnt. Yes he was. I was there. I was watching. It was like who is this guy and what possible chance does he have to be president. I wish we had time to talk about this journal piece on biden because you have talked about the obstacles to a biden presidency and make some really interesting points. Hes not going to be able to move in on her by going further left which is what Bernie Sanders is doing. Its not him. He cant do it that way. Its going to be hard they have similar policies, to deny the democrats the first woman president. That would be hard to do. So the only way the yourjournals he can do it is by pointing out her dishonesty which the whole party knows about but no one would say it. He would have to make a conscious decision to go at the track record of the clintons and he would probably loath to do that because youre kind of destroying a candidate. Youre giving the republicans their talking point. I dont think hes going to run, joe. Thats what i mean. He cant. That would be the only way he could do it. I dont think thats the reason he cant. But i think hes not going to. Pretty compelling piece. Thanks, john. John, you finally look at the journal page at some point dont you before you memorized every New York Times op ed. Give me a break. You dont even have to memorize it. It just oozes out of you, thank you, john. Joe, i dont have time to deal with this today. We dont have time to deal with it. But i will deal with i