Transcripts For CNBC Closing Bell 20240712

3386 is the number to watch for that s p 500 record close. 59 minutes until the close we have a big show coming up to day the s p 500 makes yet another run at that record close bob doll will tell us why he is expecting the economic recovery to be more choppy. And why hes cautious in the short term plus, gaming the impact of the dnc. Well speak with a policy expert who says this weeks Democratic National convention could be a negative for the market even though its happening virtually. Right now, were going to focus in on the big stories were watching to day. Bob pisani is tracking to days action we have the latest on growing tensions with china. And joining us with his outlook for stocks is tony dwyer bob, start us off with the Broader Market whats going on behind the scenes and whether you think we could see that record s p 500 close today. When you get this close within less than 1 he , you usuy can get over it. Were still not there. 3386 as you heard before is the old closing high that is on february 19th were knocking at the door well see if we can hit that today. In terms of whats been moving, well, its still largely technology i know theres been excitement about occasional little rallies and banks and energy and industrials, what we call cyclicals and value stocks overall, Technology Stocks today were hitting new highs on the old work from home stories Companies Reporting this week like home depot and lowes, quarters ending in july. Theyll be reporting theyre hitting new highs. Best buy, masco. Dont kid yourself leading the rally is the ultimate work from home play those are Technology Stocks. Since the february 19 th highs, Consumer Discretionary is up there elping that is mostly amazon. Along with technology, communications services, health care, and technology as you see,the big mover up 12 . And thats what matters here i keep emphasizing the big five mega cap momentum names. Amazon, apple, netflix, facebook, microsoft, look at these gains here apple, 42 since the old february 19th high thats whats pushing the s p 500 when you get these stocks representing 20 or more of the s p 500. Singularly that, makes the difference and whats lagging is i know people got excited about industrials and banks and energy occasionally they will be outperforming, but not very often you see banks way, way down and down again today as we heard Warren Buffett exiting a few positions on some of the large Money Center Banks well see if we can make it. Back to you. With rate as low as theyve been, hard to see how the banks could rally. I want to ask you about retail were going to see a flurry of returns this week. What about the lack of stimulus that weve seen from washington and the fact that some of the Unemployment Benefits have run out or been decreased and there isnt another run of stimulus checks what commentary are we going to hear from the executives about the amount of money in consumers pockets its a real Inflection Point right now. You saw some work done over the weekend, some reporting. Consumers had money in their pockets even if they were on furlough, they had stimulus checks i think were going to get very cautious commentary. The numbers for home depot, much better than expected theyve been raising numbers for a while now for the second quarter. I anticipate its going to be very cautious about a clear indication that consumers are going to continue to get those stimulus checks. Many people still essentially furloughs and heading towards layoffs. Bob, ill pick it up there. Well discuss the sales a little later in the show. Tensions with china ramping up once again today the Trump Administration unveils new restrictions targeting huawei we have the latest d. C yeah. A lot going on in the front. You remember the phase one trade meetings that were supposed to go on between the u. S. And chinese side on washington over the weekend. They never happened. Its not clear necessarily when theyre going to be able to reschedule those neither side is expected to back out of the phase one deal. But it gives you a sense of how pick will willy things are right now. And today the department of commerce announcing additional action heres. The department of commerce is concerned that huawei was able to do a work around of some of the earlier restriction onz that companys access to chips. So today its tightening up. Heres what the Commerce Department is doing. Theyre requiring nonu. S. Firms to have licenses to sell chips and software to huawei theyre also adding 38 affiliates of huawei to a blacklist. A total now of 152 different entities secretary of state mike pompeo said today, huawei is an arm of the chinese surveillance state, underscoring u. S. Concerns that if huawei has access to the global chip market, they will continue to produce equipment that the u. S. Government worries could serve as sort of spy ware for the Chinese Government to have access to the Global Economy more broadly over the weekend, we did see the president hint he could take action against additional chinese firms here there is a political undertone to all this. The president is campaigning for reelection in november as a tough on china candidate the president mentioning alibaba over the weekend as one entity where maybe he might take some action so well watch for anything further from the Trump Administration in the months to come clearly, a political undertone and perhaps the election would or could warrant a total change after proech on china tensions thats not doesnt seem particularly likely. Either way, is there a time over the last couple years when tensions have felt as elevated as they are right no you its just fascinating the s p 500 is two or three points off a record close yeah. Look, i mean, i think markets look at this and said, well, there is the trade deal. Basically Everything Else is just sort of tit for tat maybe ultimately the markets here are just not as concerned about this and think its going to go away in november but to your point, if joe biden is elected in november, biden is somebody who is not campaigning as a sort of proponent of global free trade in the way that the Bidenobama Administration was a proponent of that. Joe biden said hell be tough on china too if hes elected. I think the tone and techniques will change. The overall thrust will still be there. One of my sources on trade has suggested that perhaps the white house wanted to narrow the scope of what this particular trade discussion was going to be about. They wanted it to specifically focus on phase one, not necessarily all of the various commentary that administration has thrown at china recently but im wondering how much of what the president is doing right now do you think is just saberrattling and how much muscle do you think he really has to take a hard line against china between now and november well, there are a lot of little administrative actions he can take ultimately, he cant affect the entire course of this relationship i think your point is a good one about what it was that they were trying to tailor these meetings over the weekend to. The phase one conversation is an easy conversation for the u. S. And china to have. Both sides agreed to the deal. Both sides agree it should stay in place even though the chinese havent made as many purchases as they promised due to the pandemic, both sides said theyre okay with where that is right now so that is a friendly conversation a broader conversation about all of the different elements including huawei and alibaba and Everything Else, that is a much more tense and fraught conversation can you see why some people here didnt want to have that conversation thanks so much for that lets continue to discuss what all of this and other factors mean for the markets tony dwyer joins us. Tony, great to see you as always i mean, whether its china concerns, whether its the lack of a stimulus deal, your take is that the extraordinary injection of liquidity into markets justifies the fact that were shrugging off the concerns yeah. Thank you for having me. Again, the excess liquidity is something i get. It basically shows if you add up m2 and you take that plus stock and bond mutual funds and etfs, so readily available money something if you sell, you know you have the money today or tomorrow if you take that against what is needed for Economic Growth, it gives you a spread we have never seen anything like the spread that weve got. So you as you know, you get economic and market trouble when you have a need for money and no access to it this is doing exactly what took place after the 2009 low where the fed injected so much liquidity and money supply began to grow above and beyond what you needed for really depressed Economic Growth, that carried the market until the point where you started to get that increased economic activity. So i get that argument the, tony even if its as pronounced as its ever fwhn your eyes, what about the short term what are the short term technicals or other warning signs suggesting to you . So we put out a note today. Im looking at this environment and its so much like summer time of 2009 to take you back, in march of 20 2009, the market made a low. It went into a pause or little correction in june or early july of 2009 and then grinded higher on volatility. Volatility according to cobe, it got down to about 23 very similar to now. Then you went into a period two of months and the end of august into early november where you had four pretty nasty little corrections. Each correction that would range between 3 and 7 , you made a new high right after that. So were calling it a stair step higher and i really believe that were set up for when people like me, i havent raised my target, when people like me are out there jumping over each other to make sure that we have a target that is appropriate relative to where the market is, thats usually comes from pressure from the client base. Not from them directly but from us not wanting to look or feel wrong. Thats the kind of thing that is a setup for a little bit too much optimism and time for a pullback so how much of a pullback, tony, do you think we should see . And in ermz terms of the Global Recovery, is there a risk that the u. S. Is slower recovery or at least slower ability to keep the virus under control could be a tail risk to the broader Global Recovery story that everyone is talking about . Yeah. Thats a great question. So every cycle theres a different reason that you go into recession it can be the snl crisis, it can be world com and telecom bonds blowing up, it can be great financial crisis and, it could be a covid19 crisis the reasons are always different. But what happens once youre in a recession and begin to he ameri emerge from it are not typically the market has this massive move off the low h the dollar starts to weaken because the flight to quality ebbs you get into this environment where you think the market is ahead of itself. The economy cannot catch up. And of course that happened in 2009 and 2003. It happens after each recession. What you get then is a lift. You get all of a sudden this global synchronize recovery. It is truly extraordinary that youre getting a never before seen level of excess liquid and its no the my opinion or view, it its just statistical fact. You have a historic amount of excess liquidity according to the oecd or market pmis, youre just beginning to pivot in a synchronized way a Global Economic shutdown that came from the covid19 so again, it was the covid19 that drove it. But excess money and reentering Economic Growth of any kind is what lifts it back up. So again, you know, to be clear, were very favorable weve been in favor to the cyclicals over the stay at home stocks for a come of months now. Sometimes its no the so right but its a theme that will be with us for years. It was the last time so were pretty bullish even with a prospect of a 3 be or 7 correction we are watching that closely, tony we need to leave it there. Tony dwyer we have breaking news we want to get to new developments in the fight between epic games and apple josh lipton with details thats right f epic is just now saying its seeking a preliminary injunction against april apple, seeking a court order of removal of fortnight from the opp store. It is being cut off from ios and Mac Development tools. Epic saying were asking the court to stop what it calls this retaliation. Remember, apple and google both pulled fortnight from the stores after epic launched that in game Payment System that bypassed the rules. So now we have this court battle that could take years to play out. We also have that battle in the court of public opinion. That is very important too back to you. David and goliath fight josh lipton, we appreciate the update there coming up on closing bell, shares of teledoc higher as wall street gets bullish on virtual medicine up next, well speak with the ceo of competitor md live about how the pandemic has transformed health care in america youre watching closing bell on cnbc. Well be right back. Introducing stocks by the slice from fidelity. Now you can trade stocks and etfs for any amount you choose instead of buying by the share. All with no commissions. Stocks by the slice from fidelity. Get your slice today. Stocks by the slice from fidelity. I keep working my way back to you, babe with a burning love inside yeah im working my way back to you, babe and the happiness that died i let it get away servicenow. The smarter way to workflow. I am totally blind. And non24 can throw my days and nights out of sync, keeping me from the things i love to do. Talk to your doctor, and call 8442142424. You say the customers maklets talk data. S. 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That stock up 9 today the upgrade comes on the heels of a news report that teledoc competitor is preparing to go public in 2021 with the teledoc deal being a driving force behind that decision md live seeing a huge increase in demand this year with bookings through june soaring by more than 300 joining us now for more is charles jones, the chairman and ceo of md live charles, good to see you thank you for joining us thank you for having me so tell us a little bit about the next six to 12 months for your business. It seems there is going to be a shift ahead from getting patients who would normally go to in person doctors visits on to telehealth platforms to reaching more patients and americans that dont have access to medical care through telehealth tell us about that transition and what the outlook of your business looks like. So as you pointed out, were seeing a huge increase in bookings for the business. 85 increase in revenue year over year to date. But what is really going on here is the pandemic has created knowledge that Digital Health can satisfy the needs, the health needs of people because it provides ample and better care, promptness and the ability to see a doctor on average we do it in 7 1 2 minutes. Our competitors and ourselves are all under 10 minutes from the time you need a medical visit until you get to see a doctor it allows for contagious free environment. And important to the payers and to the consumer is the fact that the costs can be less than the infrastructure cost and the execution costs in brooks and mortar you take convenience and care, you take cost, you can take contagion and america is becoming intrigued in its use of telehealth youre Company Raised 236 million so far why are the Public Markets attractive to a company like yours and why is q1 the right time to go public . Well, i think what the Investment Community is understanding is this isnt just a growth phenomena for a company or several companies this is in the Public Interest and what i just laid out, as good as this is today, as much as of an improvement it is, invest me investment and technology can make it better speed, accurate comprehensive d diagnosis and lower the cost and make it convenient as the Patient Consumer would intend it to be. The combination of all this is just strategically compelling. It is by acquisition as they consolidate and build better economies of scale enormous opportunity here with great public need. We all know with the babyboomers, the demand is increasing the supply of doctors is decreasing this is a way to better manage those resources and make the doctors moore available. There is Better Health care. Charles, what further level of development in terms of technology is needed for the ability for doctors to diagnose things remotely being just as good just as foolproof as in person if everyone had a smart watch on wrist. Would that make a huge difference its here today theyre monitoring equipment and thats going to make the care of patients and what is going to be important is its going to be overlaid with Artificial Intelligence thats going to gather that information. Knowing a problem could be coming its going to alert the appropriate health care personalities in order to intercede and make sure that things dont get out of hand you avoid hospitalization. If you need other attention might be appropriate so it is investment and remote diagnostics and Remote Monitoring the necessity of Artificial Intelligence and not unimportantly, all the logistics necessary to make sure the right doctor with the right board certification is available on the day and the hour you need tremendous amount of prediction as skills have gone in to this business md live and our competitors and making sure the doctors are available to execute. Charles, is there any analysis in terms of things like how many prescriptions have been given out per appointment this year in remote appointments versus last year in in person appointments i wonder whether there is maybe its high everywhere, is there a difference in terms of the doctors ability to think i would like to follow up and check this or to be able to raise this issue with the person if they were here in person. But since theyre not, i better just be careful and give them the prescription either way. So the pandemic has made some things unequivocally clear to me people who are doctors, they really care about the patients they really care about the patients these people dedicated their lives to taking care of people so they they are prudent in the execution of their work. We have as our competitors do a quality review process we have clinical reviews we tape record all these visits so we can actually get into the details of what takes place and the medical doctors full time employees of ours reviewing this go through this material the care they get is equal to the care you get in bricks and mortar i also want to add the pandemic reflected Something Else to us that is the payers care as well. Many of them to my knowledge, all of them eliminated copays in order to encourage people to continue to get medical care and not to worry about a copay. They encouraged them to see telehealth doctors i think that is a terrific indication of how the whole system is coming together given the contest the Health Contest that comes from this pandemic to your point about the number of prescriptions, there has been a considerable number of increase in prescription thats versus the function of so many more visits. But also as the doctors become more familiar with how to continue to monitor and Health Record system in that regard there is great follow off as well. Charles jones, thank you for joining us thank you weve got 35 minutes left of the session. The dow is lower s p 500 slightly higher. Nasdaq up by 1 . Were just still a little way off the required level for a record close 3386 the number needed on the s p 500. Up next, more mcdrama. The mcdonalds Ceo Steve Easterbrook is rpoinesndg to the call back of his sefrns pay. Those details after the break. I see an unbelievable opportunity. I see bestinclass platforms and education. I see awardwinning service, and a trade desk full of experts, available to answer your toughest questions. And i see it with zero commissions on online trades. I like what youre seeing. Its beautiful, isnt it . Yeah. Td ameritrade now offers zero commissions on online trades. New developments in the bombshell lawsuit brought against mcdonald against steve easterbrook. He granted one Employee Stock options and conspired to keep evidence of the relationships secret he is not denying the existence of the relationships they filed a meritless and misleading lawsuit in the wrong forum. They argue that mcdonalds has not received any new information since the board offered him the separation agreement by all the corroborating emails have been in the companys possession and the suit is filed in the wrong state. Delaware where mcdone saldz incorporated instead of illinois where it is headquartered. The company said we stand by our complaint the factual assertions and the court in which it was filed a lot of gray area between the two sides. We have to see where this settles. Even if there was a slew of convincing lies told by easterbrook over the top, it still doesnt get you past the fact that mcdonalds had on its servers damning evidence at the time when they were getting rid of someone for some level of wrongdoing however serious that wrongdoing was at the time they believed it to be and paying that person tens of millions of dollars and they failed to do the Due Diligence to find that evidence which was on the servers. Maybe there is all sorts of misleading lies told on top of that which might have made the job a little harder. Fwhaut is a damming indictment for the mcdonalds board that they could authorize a payoff while firing someone for wrongdoing and not done enough due dial jell jeens at th dilig they wanted to air out his dirty laundry saying this material even existed. The company has 3. 5 billion of cash on hand as of the end of june and its going after a sefrns payment that, yes, is very lucrative, more than 50 million in stock and options for easterbrook. But it did have that material in his possession its a teaching moment for company and executive here for the company, read the receipts before you write the agreement. And for the executive, for anyone really in Corporate America as my good friend the comedian heather mcman says it, say it, forget it, write it, regret it. Its extraordinary. In terms of whether theyre airing the dirty laundry, they also have a matter of principle of making sure they did come clean on perhaps the further details that they later became aware of that their former ceo had engaged on so there is a matter of principle there theyre going through. Either way, it is still to be played out in delaware or elsewhere, well see mcdonalds stock flat or so today. More details to come out of that extraordinary story. Now time for our coronavirus tracker. New cases of the virus in the u. S. Have remained stubbornly high in recent days with the country averaging more than 51,000 new cases per day over the past week. Seven day rolling averages are high in states if california to delaware, hawaii where cases have jumped. This comes as universities and schools have begun to reopen many against a backdrop of Significant Community spread in new york, Governor Andrew Cuomo says gyms are allowed to reopen at limited capacity at 24th of august shares of Planet Fitness rallying on that news. New zealand postponed elections as they struggle to contain new infections spreading across the country. It is time now for a cnbc update with sue herrera. Sue, what do you have for us we have lots of news going on today. Thank you very much. Two men have been indicted today in the 2002 shooting death of run dmcs jam master j. One of new york citys best known unsolved murders Ronald Washington who had been living on a couch at the musicians home and carl jordan are accused of killing the hip hop star in his studio even though pizza sales have soared during the pandemic, 300 of pizza huts 6700 u. S. Locations will be closing in a deal between the chain and its largest domestic franchisee which it happens to be in bankruptcy protection. Most of those closings will target dine in restaurants former Ohio Governor john kasich is among the four republicans scheduled to speak in support of joe biden at tonights kickoff of the democratic convention. Heres one former gop leader who will not be endorsing biden or trump for that matter in response to speculation that john boehner may back the democratic ticket, a spokesperson told nbc news, the answer is no hed rather set himself on fire than get involved in the election. Just love the quote regardless of your politics youre up to date. Back to you. John boehner never one to mince words. Then or now. Sue, thank you still ahead, nba hall of Famer David Robinson is the cofounder of an Investment Firm with more than 1. 7 billion in real estate assets hell join us with his take on the real estate Landscape Plus his thoughts on the nba bubble and more as we head to break, heres a check on bonds as business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will. You can rely on the people and the network of at t. To help keep your business connected. The coronavirus decimated Retail Industry sending names from Neiman Marcus to j crew into bankruptcy. A Licensing Firm Authentic Brands can hold the key to saving some household names from failure. Lauren thomas joins us now lauren, youve been speaking with the ceo and what theyve got planned to continue to try and save a couple more brands. The question is how deep are the pockets . How many brands can be saved yes, exactly. Thank you for having me. I did recently have the opportunity to catch up with the ceo of Authentic Brands and he pretty much put it as, look, im just nif just in the first inning here. He received 600 million from backers that include black rock and will he be ard green and partners and he said he has over a billion dollars in cash on hand at this point looking to do many more deals. So far, with Simon Property group, the biggest mall owner in the country, salter has come together and made bids for both Brooks Brothers and lucky brands and is expected to acquire both of those as those deals are transactions are completed so far weve seen about 40 bankruptcies from retailers this year and when i talked to folks, i think many more are expected to be on the way. So certainly Authentic Brands with Simon Property group, i mean, i think could be in some way, you know, they could be the one to save some of the retailers that are on the brink of collapsing, obviously, with the pressure thats been put on the industry and the pandemic. So again, more than a billion dollars on hand and probably expect some more deals to come lauren, a lot of the brands that are in authentics portfolio declared bankruptcy first and then rescued after they declared s that still the strategy or are they trying to rescue the companies before they actually file chapter 11 . Yeah. Thats a great question. I think the strategy is still waiting to see who files and strikes some sort of deal to rescue companies from bankruptcy i think the thinking there is that you can get it at a much better price and even the ceo said were getting retailers, you know, very cheap and they can make their money back theyre looking to make their money back within a year max so i think the strategy still is like they did with forever 21. This was the team that rescued forever 21 and air pos will. So there is a trend here were waiting to see what happens with jcpenney. Theyre still in bankruptcy proceedings right now. Were waiting to see ultimately who can save them as well. Lauren thomas, thank you for joining us thank you weve got just 22 minutes left or so of the session. Were lower on the dow, higher s p 500 and over 1 higher on the nasdaq after the break, a few hours from the kickoff of the virtual dnc. And one policy expert says this weeks pomp and circumstance could actually be a negative for the market well discuss next [squeaky shopping cart] [sniffing] is the salmon wildcaught . She only eats wild caught. [cash register beeps] uh, i need a price check on honey. Dont get mad. Get e trade and get more than just trading. Investing. Banking. Guidance. The dnc kicks off today. Could spell trouble for the stock market joining us now on the cnbc news line is terry haines, he is the founder of that company. Terry, im curious what you think were going to hear from the campaign this week the former Vice President and senator Bernie Sanders launched a 110 page manifesto in july that pretty much laid out all of the these progressive president ial policy positions. So what do you think we can learn this week that is new . What happens is a lot of the policy positions get adopted as the official democratic platform mostly most time platforms dont mean anything really i think this is the rare case where it does mean something markets generally think that biden is likelier to win than not. Markets i think comfort themselves that Vice President biden has been a centrist throughout his political career. There is going to be a wakeup call this is not going to be running or governing as centrist they send them as progressives and i call them progressive light. And thats going to introduce among other things the potential for large tax increases, one source calls it a 4 trillion tax and may cost the top 1 earners of 8 in after tax income there is discussion even back in the sandersbiden document about a new fed requirement. Nothing against the fed considering this it is an uncertainty about the mandate. So, terry, even if the democratic campaigns you think they also end up governing in the same way whether by intention or the restrictions that they might face unless they get a clean sweep . Thats the excellent question, wilf it depends it depends on whether you have biden and harris as president and Vice President alone with a continued divided washington then i think divided washington continues to be the base case here but if things move towards an all democratic washington, thats the scenario in which biden and hair kois actually make a lot of this happen. So, you know, today, i tend to be nonconsensus about the election i think its only about 20 likely you get an all democratic washington but, you know, were a long way from the finish line and fit looks more and more like that going into late september or early october, youre going to see the markets react accordingly. The terry, regardless of what poll you look at from recent days, they show the Biden Harris Campaign lead is shrinking im curious what you think that portends for the rest of the Campaign Season and how high that makes the stakes for this week for the democrats i long thought that the polls were going to tighten substantially. And, you know, that is already starting to happen, number one they are national polls. There are likely or actual voters so the race, generally what is going to happen here is the race is going to tighten further, number one number, two most voting advantages are going to be in voting totals for biden and harris are going to be in coastal states that are already blue and are already in their column so youre going to be down a very tight election. Anticipate the market stakes are going to be there is going to be a substantial amount of market nervousness a month from now. Thats going to continue through the election not least because both sides now, both trump and democrats are starting to put pressure on the elections themselves there is an additional nervousness as there already is about whether the elections actually going to get resolved on november 3rd. Or weeks or days or even months after a lot can happen in 78 days between now and november 3rd will well stay in touch we appreciate your views today thank you terry haines. Buffet gets the gold bug amazon looks to the cloud and nvidia may be on the cusp of a major acquisition. Those stories and much more when we take you inside the market zone. At leaf blowers. You should be mad your neighbor always wants to hang out. And you should be mad your smart fridge is unnecessarily complicated. Make ice. Making ice. But youre not mad because you have e trade which isnt complicated. Their tools make trading quicker and simpler so you can take on the markets with confidence. Dont get mad get e trade and start Trading Commission free today. 10 minutes left in the trading day. Were in the market zone. We have credit suisses chief u. S. Equity strategist joining us on the phone. And victoria fernandez, good afternoon. Lets kick off with the Broader Markets. Were on record close watch for the nasdaq and the s p 500 well be the first record close for the s p 500 since mid february 3385 is where we stand at the moment we need one more point to get over the line. 3386 so were very, very close indeed nasdaq up a healthy 1. 1 nicely on track for that jonathan, ill start with you. I mean clearly there is a lot of issues that the market is facing there is a battle with the backdrop of the 15 Million People unem moid we dont have any clarity on when the virus is going to be complete its going to take a couple years to get back to a economy that was at the level before the crisis yet, the cost of capital collapsed. And the government has really come in and put a down side under the market its put things in the right path and youre correct, the earnings are coming in extremely strong and the market seems to be really encouraged by the incremental direction of the market move. Not the level but the rate of change is all positive on the economics. Jonathan, considering that the cost of capital, thats going to be low for the foreseeable future does that mean that you should continue investing and things like Consumer Discretionary because of the positive sentiment from Home Builders and autos . I think there is a special case as it relates to Home Builders and autos and the consumer i think when you see the cost of borrowing down and thats really talking about the cost of corporate borrowing which is how stocks are valued, this really says that Long Duration equities, were talking about Growth Stocks, Technology Stocks, and companies that are really stable long term franchises, those are the big winners. The companies that dont win in a low Interest Rate environment are the cyclical names, financials, industrials, mining companies. So you really have a bifurcated market 70 of the market extremely healthy. You know, deserves peak valuations and you have about a third of the market that is under pressure theyre not participating. And a low Interest Rate environment exacerbates that disparity between those winners and losers in the market victoria,clearly as jonatha said, the direction at least of most of the Economic Data of late has been positive does it risk changing direction if we dont get an extension of the governments stimulus bill i think it absolutely has that risk. Right now i think built into the market continuing to see the market move higher, here we are at almost new highs on the s p 500, is the fact that people expect to have that new stimulus package in place its already built in to what the market is seeing and what theyre looking at Going Forward. I think it was a little bit of a surprise that we saw congress l leave washington without something in place, at least a preliminary agreement they can work on. So you have households that even though they have stronger Balance Sheets than they did before covid19, i think that if they dont get that Unemployment Insurance kmming in it, were going to see consumer demand and consumption pull back. For us thats key in this marketplace. We can continue to have some of these high flying names make their move forward we own them in our portfolio so, you know, we continue to own them we continue to think there is a trend. There the consumer is really going to drive the economy of thats going to drive the sentiment. And we know that all of that is related to what the market is doing. The economy is going to go the path of covid19 if covid19 does better, consumers will do better thats going to drive the markets Going Forward. I want to turn now to gold. It was up today after last weeks snapping a nine week winning streak take a look at shares of barrick gold they revealed a 562 million stake in the company that is as of june 30th this year the stake is relatively small investment for the conglomerate. Berkshire is now the 11th largest shareholders in barrick. The move is surprising dismissing gold as a good story val uchlt either way that, is driving barrick up 11 or so it goes a little bit against victoria the philosophy of the oracle of omaha. What does it tell you if hes getting into gold now . I think a lot of people have this gold play in the portfolio because theyre looking at some of the inflation concerns. There was a deflation concern for such an extended period of time and now were starting to see that turn around we saw some of the cpi and the ppi numbers actually move higher we have seen the dollar move down i think about 5 in the last 12, 13 weeks that is not surprising were seeing treasury issuance continue its an inflation play that people are going into gold you can look at other ways to do that inflation play. Can you look at tips there is a lot of demand going into tips. Were seeing the inflation break even numbers move higher we dont actually hold gold or the mining players in our portfolio. But i think its the inflation that is driving that and we need to be careful going back to the consumer demand make not being there that inflation may not move as high as some people anticipate now nvidia shares rallying today. Theyre in talks to buy oarm holdings we have details. By the end of the summer, thats when nvidias ceo could close the deal for arm according to the evening standard. Declining comment to cnbc. The report indicates arm could be valued at 52 billion they have been on a terror hitting a fresh all time high in todays trade. Rallying more than 100 so far this year. Acquiring arm would be huge. Making nvidia a big player in the cpu market that is the primary brain in most Computing Devices they report earnings on wednesday. Had the team just hiked the price target to a new street high back to you. Thank you so much for that. Been an interesting last 12 to 18 months for arm going through a number of potential and actual transactions jonathan, when you look at the valuations of some of the chip makers, what do you make of them do you think theyve gone too far too quickly . You know, if i were playing in the technology space, i would probably focus away from hardware and chips largely because the Business Models of the social Media Companies and the Software Companies i think are much more advantageous if were in a softer economic environment. But i just think that the backdrop is such that were going to see multiples trading much higher than they have historically for the chips companies and Tech Companies and for the whole market while that has a lot of investors incomfortable, i think theyre going to hold on to the types of valuations. All right Airline Stocks under pressure. As the industry. And it is largely expected this. But it is basically confirming what we feared its a weak market right now. And thats the reason why we need to take a look at the stocks today theyre down 3 to 4 depending on the airline that youre talking about. And theyre all under pressure because frankly september is going to be slower than August August was nothing Great American airlines has trimmed the schedule for the month of september. Theyre bringing it down by 11 compared to this month that brings it down 59 compared to september of last year. International, down 77 compared to the same month last year. The big focus right now for airline investors, will the carriers get the jobs act that would bring 25 billion in insured jobs through the end of march. Youve been following that closely there. If they dont get that money, the layoffs will begin on october 1st. Phil, thank you so much for that rack space one of the big winners today. We have the details. According to a source familiar, rack space is in talks with amazon for a minority investment that comes after the Cloud Services company went public in a disappointing debut. They price ted bottom end of the target range and they sank more than 20 on the first day of trade even with todays pop, shares are below that 21 ipo price rack space partners with amazon and other cloud giants a potential investment could help amazons leading position in Cloud Computing and help it better compete with microsoft in the enterprise space back to you. Thanks so much for that one we have 30 seconds left of the session. And we are just about short of the record close 3381 is where we stand we need another three or five points to get to that record close watch. We were very close to the level and just pulled back in the last ten, 15 minutes or so. Nasdaq continues to lead its up 1 record close due for the nasdaq. Consumer discretionary and technology the best performing sector rates pull back. At the close, were a little short, kayla for the record high on the s p 500 by four points. Still higher by a. 3 for the s p 500. And so we wait aol day for that s p 500 record. Welcome to the closing bell. Im in for sara eisen. The dow is down about a third of 1 the s p 500 closed just four points shy of a record close the nasdaq notching a record close of its own at 11,129 that is 20 points higher than the record april close russell 2000, up. 5 closing up eight points. 1585. 47. Coming up, well ask the chief equity strategist bob doll about why he is cautious on the short term outlook for the market amid the record run for stocks. Joining us now to talk about the market day, Jonathan Golub via phone and victoria fernandez chief strategist from Interactive Brokers also joins the conversation steve, why do you think the s p 500 couldnt make it the last four points to get the record today yet again . We got so close at this point, its not really a matter of if, its a matter of when or if we make it or dont the bigger question i think we have, is you know, not whether they could get a push up a little bit more on the close doesnt take much to move four points i wasnt there in the closing basket, i suppose. But quet is what do we do next does that bring out some profit taking does that lead to further highs . Do we consolidate . Right now it is murky picture. Were close enough for comfort. Steve, that also, i guess, does suggest a level of complaisancy that, you know, its a matter of when not if we get to those record highs. Do you feel like many other people are thinking the same way as you does that concern you that there might be not that many fresh buyers o left out there . Im quite fearful about the lack of fear and that i think speakers to the cl complaisancy were in an upward swinging market with loads of liquidity so what if they cant agree . Lets call it the fiscal put it is priced in and not happening. But the feeling is if it gets bad enough, theyll help out right now you can come up with almost any scenario and say well, we could put a positive gloss on it. But when you really get down it to, yes, it does worry me a little bit markets require fear and greed i really get the sense that we are very heavily to the greed side and much less so to the fear side. There is so much priced into the markets though relatively good earnings expected Massive Central Bank liquidcy. Victoria, as you pointed out, the expectation of at least a trillion dollars in stimulus but we dont have that the earliest that we can get that is september. Even then its not a sure thing that both sides of the aisle will agree so at some point isnt the market going to get surprised . I would think sorry. That is for victoria. Well let you answer that. Pt. I think there is always the opportunity to be surprised in the market and i mean we would expect a pullback at some point there is so much uncertainty thats going on right now. And we talked about the push and pull that we have in the market with some of the positive numbers but yet being concerned that were not going to stimulus go through this morning we had Empire Manufacturing come out and it really disappointed on the numbers. So we have to look and see how do we think things are going to progress Going Forward we do have an optimistic outlook right now on the market. But i dont think that means that you have to stay all in in equity markets were doing a barbell approach here at cross mark so we trimmed some of the names, the high flying names like apple and microsoft. And actually gone in to some more stable names like a walmart, a mccormick we even dipped our toe in the financials with j. P. Morgan. Theyve had a big hit, the financials have this year. We saw some opportunity to go in there. So i think take a barbell approach, find some opportunities in the market. Because you are going to have that volatility and then if you have a surprise and you have a pullback, youre well positioned for that jonathan, with all the liquidity weve seen in the market, do you think the average pe for the s p 500 in the decade ahead of us will be significantly higher than it has been in the decade behind us much higher i mean weve if you look over, you know, the last 30 years, the average pe of the market is Something Like 15. And right now were over 23 on a forward multiple there is no reason why that doesnt stay higher. The multiple is high because the Interest Rates are low and i know that were in the middle of a crisis its going to sound crazy. But the underlying stability of the market is higher if you look at the cash flow being generated by the very largest companies, even during this crisis are, you know, just unbelievable there is the continue to return substantial capital even in this environment. So once we get through the worst of this, i think were going to see over the last decade, that is the single thesis is that over time, the valuations are going to continue to drift higher. And about this whole fear versus greed argument, the market, you know, it is easy to say fear versus greed the market discounts information. The market is assuming that were going to get a deal. We could be wrong. But were going to get something from the government in unemployment and this is all about haggling if were wrong, the market goes down but thats what the market is discounting. The right now the market is discounting that even if joe biden wins and even if democrats take the senate, theyre not going to do a massive tax increase the worst of the policy platform is not going to get enacted. I think the risk right now is to the upside even though there say huge amount of uncertainty. You know, steve, were talking about nosebleed valuations, the expectations of the market healthy and 28 million americans are collecting jobless benefits. Im wondering how you would size up the state of the real economy right now, not the corporate economy. Real economy is not healthy its talking about rents being down 20 on the apartment that hes looking at. So thats one slice. But the problem is its a little different. It doesnt reflect the economy and its always reflected best and brightest. Now increasingly representing the best and brightest put things in perspective, the top five Nasdaq Companies have the same market cap as the fed balance sheet. Thats 7 trillion so were not really focused as much the broader ultimate lishgs you need a strong broad economy. Ultimately, i think low Interest Rates are nice but not sufficient low rates were sufficient, japan would be at a remarkable price valuation. But its not they reflect an equality that is not a bad thing. The about it there is a divorce. Can you understand why there is a divorce. There is just such youre not investing in mom and pop retail. Youre investing in amazon, whether you want to or not, actually i want to bring up another story. In a is the banks. Financials are down 1. 5 i do think that was largely because yields pulled back from the highs they were at last week more than anything else. But clearly, a lot of talk about Warren Buffetts 13 f filings on friday and whether that influenced the Bank Share Prices or not at one point i always like to remind people of in case people forget it which is that Warren Buffett has a board seat at jp morgan so whatever people say about whether or not he times these sales well or badly or is past the prime or whatever that might be, he does have more insight into the biggest bank that has the tentacles in all areas of banking than anybody else does in term of the investors and decided to be now for 2 f13 filings a net seller of banks. Yes, buying bank of america. But that is clear now to be a relative small vote of confidence in one particular name as opposed to an outright vote of confidence in the banks. And j. P. Morgan is one of the safer plays. It is one of the banks he is selling despite having that insight in the board seat. I think it is worth noting that. He does have more information than others when it comes to picking winners and losers in the banking space. He is very clearly a net seller of the sector as a whole and someone who in 2008 helped shore up the entire Financial System in bank of america. He knows more than anyone almost about the Banking System as you point out. The that is why his insights and his decisions are scrutinize d o closely letter. In terms of the banks anticipate rotations from outperforming growth names, underperforming cyclicals, do you think the banks should be a beneficiary if that rotation continues . Are they slightly separate because their reliance on yields and reliance on government stimulus which may or may not be forthcoming . You know, you made a great point today on why banks are probably selling off today its a fact that theyre very, very sensitive to the fact that Interest Rates are really low in a way that is very, very difficult for banks to be profitable in an environment where if the overall economy is hobbled, lien loan demaoan dema going to be that strong on a Going Forward basis. Longer term, you need a healthy economy. The banks i any the insights that Warren Buffett had in the 0708 environment about the credits and holdings of the banks are very different than today where the Business Models themselves are under pressure. There is a reason why theyre laggers to day or broadly. And unless we have a rotation in where rates are really moving higher, very hard to see how the banks are going to be a leader but if you do see Interest Rates on a ten year bond pushing towards 1 , banks absolutely crush it on that type of a move. But thats definitely not our base case. Jonathan, victoria and steve, thank you for joining us pleasure. Pleasure. We have news crossing on pinterest. Kate rooney has it pinterest hiring the third female executive to the board of directors. This comes days after a lawsuit was filed by a former pinterest executive. And the new Board Director Andrea Wishom from harpo pinterest ceo Ben Simmerman acknowledging an employee protest thats gone on today in his announcement of her to the board. Saying she is an expert in creating positive content for global audiences she is passionate and advocate for building a company of culture and respect. So again this comes after some pushback on the company after a lawsuit. Guys, back to you. Thank you so much for that one. S p 500 just fell short of a record close today up next, well ask the equity strategist bob doll if the ndocks have more room to run a how investors should be putting money to work at this time or whats trending. Get realtime insights in your customized view of the market. Its smarter Trading Technology for smarter trading decisions. Fidelity. All the major averages finishing higher with the nasdaq closing at a record for more on todays markets, lets bring in bob dole bob, great to see you as always. Thank you for joining us good afternoon. So clearly very to that record on the s p 500, no the quite there. Did you think that overall the market is more due to a pullback or breakout higher we could easily break out i dont know how muchful thro f through there. When you step back, you have to realize, we have come a long way in a short period of time. A lot gf news there in the market of course, even though the market is back to where it was at the all time high, earnings are considerably lower the so we have much higher valuations we have uncertainty around the election coming up we have a fiscal bill that we cant seem to get through. I put that together and im not sure i want to chase stocks. What positioning do you have in u. S. Equities are you tilted towards the underperformers or those that manage to continue to show strong momentum to the upside . So growth over value because were overweight, technology and underweight, financials is hard to argue the opposite when you have that positioning. I guess what i would further say is i think its no longer either or. I think its both and. We have technology, nasdaq, growth leading watt i today. Tomorrow could be the opposite we have a lot of that rotation day by day do we continue to push the valuation levels up for these already highly valued Growth Stocks or do we get some catchup . The answer will dependent on how good is the economy . What happens to the dollar what happens to Interest Rates as you have all covered in the last few minutes all the issues you raise today, the s p 500 within four points so if investors arent waking up to day and getting worried about those things, when will will they wake up and be worried about them great question the path of least resistance without question is to the upside at some point in time the risk reward gets a little more uninteresting. Maybe we see the ten year yield having moved from. 5 to. 6 maybe it goes to. 7 and. 8 we were. 9 a couple months ago that will cause, i think, some pause. Remember, these higher valuations, especially Growth Stocks, are occurring because theyre Long Duration stocks like a long bond when rates go down, long bonds do better than short bonds same thing in the equity market. Thats been a huge tail wind for the big high capitalization Growth Stocks that have carried the market higher. Move up in Interest Rates. Even a little bit probably casts a bit of a slowdown in all that good activity. And this submit between the real economy and the stock market, how long will this be a divorce that is ammicable . Well, thats a great way to put it look, we are in the midst of a very strong gdp quarter. Third quarter real gdp is going to be 15 to 20 maybe higher and therefore, earnings are going to be pretty good. But it desell rates from there as you know, the stock market likes that Second Derivative if its going to start slowing down at these valuations, kind of whats the impetus to move things higher . Bob, if we were to get approval of a vaccine. What would that do to markets . It pushes them higher for a period and then people will step back and say, okay, how long am it take to manufacture enough units . How much to distribute it . But next week is a lot sooner than im getting im guessing well have a vaccine by the end of the year next week is pretty quick. There is a chance you get a democratic presidency at the same time you get a vaccine. What would that do to the market schizophrenic most likely democratic sweep back up. You dont think the markets pay a lot of attention to the election until kind of like the conventions and labor day. So were coming up on that a democratic sweep means at some point when they can do it, tax rates will move up reregulation will probably be the order of the day i dont think those things are good for the market. So the vaccine is the positive that outcome is a negative you get some schizophrenia and maybe you pick up on volatility a little bit the economy in earnings will tell the tale as we finish the year and go next year. Its likely to be okay but its not going to be as good as the quarter were now in. This is the massive recovery quarter. Bob, you have gave us a lot to think about a lot of home work we appreciate it bob doll thank you. 4,000 . Thats how much one hedge fund is able to gain during the coronavirus selloff earlier this year details about the risky strategy behind that profit straight ahead. And as a reminder, you can always watch or listen to us live on the go on the cnbc app [ thunder rumbles ] [ engine rumbling ] [ beeping ] [ engine revs ] uh, you know theres a 30minute limit, right . Tell that to the rain. [ beeping ] for those who were born to ride, theres progressive. [ beeping ] you say the customers maklets talk data. S. Only Xfinity Mobile lets you switch up your wireless data whenever. I accept 5g, everybodys talking about it. How do i get it . Everyone gets 5g with our new data options at no extra cost. Thats good. Next item corner offices for everyone. Just have to make more corners in this building. Chad. Your wireless. Your rules. Only with Xfinity Mobile. Now thats simple, easy, awesome. Switch and save up to 400 a year on your wireless bill. Plus, get 400 off when you preorder the new Samsung Galaxy note20 ultra 5g. When had a happened in march, they were able to deliver 40 x returns since q 1, they have given back some of the gains as the market kbo goes higher. He said earlier on cnbc that the markets were ripe for another major shock. We see that were repairing these things we dont see the things we dont see the opportunity and the things that lie arent corn cher always lie around from credit bubbles and were also not paying attention to the massive disparity of wealth created when we inflate the financial markets. He also says were in the midst of a epic monumental boom and bust cycle so just because were near record highs, guys, at least according to him, that doesnt mean there wont be a bumpy ride ahead. Yeah, we just heard that a little bit from bob doll at least from the macro perspective. How does his strategy work most people they buy treasuries or they buy gold when theyre trying to seek a safe haven. What is he doing here . Theyre using options to do some things called convexity that creates this asymetric risk profile so if there is a big selloff for cheap exposure, can you capture upside so investors in the strategy allocate about 3 of their portfolio to the insurance therefore, if there is a big selloff while the peers may be down, you know, 9 , 10 , theyre going to be, you know, flat to slightly higher. Now what he will say is that if people invest in gold and fund to funds and basket of hedge funds or bonds and other types of diversifiers as down side protection, youre essentially giving up your upside. His argument you is dont have to guf up the strategy as you would with more traditional mechanisms so what aum did they have in this particular strategy that returned 4,000 and what about total company uam and if we were able to roughly speaking weight it by aum, what would the returns be like then good question because obviously the law of large numbers would indicate that if it was a bigger firm, it would be difficult to achieve those returns. It is a big firm they have aum of about 6 billion. They do tend to return these payouts to investors once you receive, you know, 4,000 returns. Theyre not seeing the aum increase 40 times as a result of the returns. It is 6 billion up about 2 billion from the end of last year because they have returned capital to their investors is their only strategy the 4,000 return or not is that a small portion of what they do . Thats the main one they have now seen a scientific adviser. He, of course, wrote the book on black swan and so that is kind of the bread and butter, yes. St. Wow well, pretty impressive returns. Congratulations to them if thats what the main thing they have done this year. 4,000 thank you so much. One of the most dominant players in the nba during his career now basketball legend David Robinson is taking on the real estate industry. Up next, well ask him how the move out of cities and into bus mpti his investment strategy. Stock slices. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. Schwab stock slices an easy way to start investing or to give the gift of stock ownership. Schwab. Own your tomorrow. Rather than worry about how to pay for longterm care. Brighthouse smartcare℠ is a hybrid Life Insurance and longterm care product. It protects your family while providing longterm care coverage, should you need it. So you can explore all the Amazing Things ahead. Talk to your advisor about brighthouse smartcare. Brighthouse financial. Build for whats ahead℠ home builder stocks outperforming the Broader Market after a record increase in builder confidence the we have the details. Hi. Builder confidence in august matched the record high set back in 1998. Builders saw Strong Demand from buyers taking advantage of record low mortgage rates. The survey from the National Association of Home Builders saw a strang index in buyer traffic. Up to the highest level in the 35year history. There is big gains in current Sales Conditions as well as sales expectation officials the next six months. The only red flag, the cost of lumber has nearly doubled since the pandemic hit mills initially shut down and then reopened to much stronger demand than they expected. That added about 14,000 to the average Single Family home price. Builders said that could dampen momentum going into the fall builders continue to point to a flight to the suburbs and excerpts as they seek more space in this new stay at home world all right diana from just down the street from me, thank you our next guest is seeing a big opportunity in real estate lets bring in admiral capital he could founder and nba legend David Robinson we heard about record sebt in the Single Family space what is sentiment like in the multifamily space . Were finding its fairly similar. Theres people are drawn now to, you know, fairly safe suburban multifamily and thats where we focus for the last ten years. So were in a good position to sell right now and trying to figure out where the markets like everyone else, where are the markets going to go . What are people looking for . Will will work at home be more of a thing and, you know, is office space going to change for us theres a lot of questions out there. And there are also questions coming from washington too and some potential headwinds a potential biden presidency would remove certain Real Estate Tax benefits that help your business then there are questions about more regulations im curious how youre sizing up all of the headwinds and the propensity for a lock of a stimulus bill to lead some renters to not pay in the coming months how you are sizing all that up you know, there is incentive for renters to be a little more lax. But weve seen we have 95 occupancy and 95 of our collections are coming in. So weve seen people really working hard to keep their businesses going you know, we its really hard to say what is going to happen as the year comes to a close but obviously people are going to be more and more stressed if we dont find a vaccine and people dont get back to work and get back to buying things. Its going to be a challenge for a lot of folks sounds like, david, multifamily homes anyway with the portfolio are doing already. Is the retail struggling senator. Retail is tough its been tough all the way around a lot of the businesses are trying to kick the can down the road that is going to be difficult for hotels to figure these things out Going Forward so, yeah, thats been bate of a challenge. The we thats multifamily though is where we focus and i think thats looking strong. Its going to continue to look strong i believe david, do you see the flight to the suburbs that at least anecdotally has been described in some of the major cities . Are you seeing people looking to cut their leases to move to greener pass tours, to bigger properties absolutely. The pandemic kicked it into next level now with a lot of the cities looking at extra taxes, looking to california and new york and theyre looking to tax the wealthy. And its its a lot of people looking now to kind of move to some of the areas and it looks like its doing nothing but accelerating were looking at where are the jobs going what is the Regulatory Environment going to be in you know, what are going to be the rules . You know, a lot of cities like austin or charlotte oreg orland theyre strong and theyre going to continue to be very, very strong we couldnt have the admiral on cnbc and not talk about the nba at least a little bit. Im wondering what your perspective on the nba bubble as an ecosystem has been, whether you think its a success and whether fans next year will come back when things get back to normal yeah, first of all, its a tremendous success i give adam silver and the nba board of governors a lot of credit theyve taken the proper precautions. Theyve put together an entertaining product they transition as well as any sport out there. So very excited about the way things have gone still going to be an awkward end of the year for the season you have spoken to the players. How is it for them playing in the empty arenas. The there is no question the audience is missed it adds a certain element to the game were used to all of us played in Summer League games and played in arenas, stadiums where there havent been a ton of fans. It doesnt take away from the intensity of what youre doing youre going to play hard and practice every day and youre still competing against the guys that are your rivals so there is no, you know, less ening lessenning of intensity. But these guys understand, these are still televised people are still tuned into what is happening on every play youll see great games coming up down the stretch here. Ive been surprised how good the offense has been i dont think the defense is as good people are scoring at a high pace im curious though, david given how much of a success it has been, obviously many in the corporate world are taking note. Theyre trying to figure out what life looks like post pandemic or even during the pandemic for the offices do you think Something Like that is rep lickable in the corporate world . Or do you think that is so unique to not only the world of sport but to the nba specifically i think people have to take into account what that world may be very, very different. I tend to think people are going to try to get back to what they consider normal as much as possible i think there are going to be people in the stands again at some point i think that, you know, people are going to still want to go to offices. The i truly think theyre going to, you know, the socialization, the amount of work, the quality of work you get done when youre collaborating with your people in the office is just unparalleled there are a number of people though who have even before the pandemic started moving to home office, working more from home, being more family oriented you know, i know for me personally and from a business standpoint, its been a resetting time its been a tomb to ime to rethk family and what youre doing at the office i think people are getting a new perspective on what is important in their lives i couldnt agree with that more, david. We appreciate your time today and all of your perspectives thank yous. Thanks for having me on today. David robinson. Of course David Robinson from admiral capital. Still ahead, well discuss whether the medias massive shift torts fast growing streaming services is officially ending the era of the media mogul. Stay tuned well be right back. Experience the adventure of a bigger world in a highly capable lexus suv at the golden opportunity sales event. Lease the 2020 rx 350 for 419 a month for 36 months. Experience amazing. At your lexus dealer. Come on in, were open. All we do is hand you the bag. Simple. Done. We adapt and we change. You know, you just figure it out. Weve just been finding a way to keep on pushing. Were back time for a cnbc update with sue herrera. Hello, everybody. Heres whats happening at this hour this is one of many wildfires burning in california as that state is suffering through an extreme heat wave. It has prompted evacuations in napa county and threaten sometimes homes. The heat is also being blamed for rolling blackouts with warning thats millions of people could be affected today and into tomorrow. Covid19 cases are cropping up in k12 schools around the country, the federal government is not tracking them and some states arent reporting them and that is making it harder to know just how the virus is spreading. And just one week after classes began for the 30,000 students, the university of North Carolina at chapel will hill is moving to all remote instruction four covid19 clusters have been discovered in dorms and in in a frat in total, 130 students and five employees have confirmed cases some students have been moved to hotels due to a shortage of quarantine space and the School Year Begins kayla, back to you and having lived in one of those dorms at unc with that cluster, i can tell you it is pretty tight quarters, sue absolutely. Well see how the university handles it i think thats a question a lot of usniversities around the country. Well keep track of it for you thank you we appreciate that as always up next, postal problems the controversy over the u. S. Postal service reaching new heights endangering many jobs across the country and now big corporations are stepping up to help well break down all the details when closing bell returns. [announcer] if youve tried college but never finished, snhu lets you transfer up to 90 credits toward your bachelors degree. [woman] it doesnt matter how old you are, you can do it. You can finish. [announcer] finish your degree at snhu. Edu. The u. S. Postal service controversy reaching new heights. We have all the latest thats right. The speaker of the house today saying shes going to Bring Congress back n the house of representatives back in on saturday theyre going to vote on about 25 billion in additional funding for the u. S. Postal service which is struggling financially recently this bill under the democrats would roll back some of the policy changes that the post master general under President Trump put into place democrats say they are concerned that the president is trying to undermine the Postal Service ahead of what is expected to be a very heavy mail in ballot Election Year this year starting in it november meanwhile, were seeing a number of Companies Participating in an effort here to push for additional funding they say that the Postal Service is simply an important infrastructure underpinning. Well see whether the senate will take up this measure as well the house is expected to pass that on saturday back to you. The Senate Majority leader was asked about this earlier today. And he reportedly said that the treasury secretary has said that they would back 10 billion for the Postal Service in funding that republicans support is this an official White House Position what do you know about what the us what would back here . Well, look, the white house and Mitch Mcconnell havent been on the same page for a couple weeks. Its difficult to tell the president tweeting out this was in the past hour or, so save the post office. So it would seem that hes in favor of something here. And the question is whether or not this is an opening i think for a skinny bill as people have been talking about in terms of the overall financing for a stimulus effort. Could this be an effort to expand this bill and add a lot more to it in terms of stimulus payments to americans. Thats something that the president s been concerned about as well. And some Senate Republicans have been blocking that could you triangulate and have sh kind of a deal on all the fronts come together by this beekd . May weekend maybe, well see the shifting media world. The New York Times piece titled the week old hollywood hnally, actually died. Itit earlier today well discuss it coming up next. Stock slices. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. Schwab stock slices an easy way to start investing or to give the gift of stock ownership. Schwab. Own your tomorrow. The industry evolves into a more streaming focus world to underscore that point, barry dill said that disney will remain relevant. All the rest are caddies on a golf course theyll never play joining us is ben smith. Thank you so much for joining us its a great read. And my only to lead us into the discussion is to say the week hollywood died perhaps slightly misleading title and is more about the idea that traditional Corporate Executive media moguls have a more bleak future looking forward. Yeah that the power no longer resides in hollywood, warner Media Studios is now a subsidiary with a Company Based in texas theres great programser making stuff for hbo. But theyre in control of their own destiny. With reports like that then maybe old hollywood wouldnt be totally dead but a step towards losing control. A change in corporate structures who is in control, as you said, one of the ingredients of a Successful Company moving forward is the focus and importance still on the best content creation. Thats obviously a huge part of it. Whats interesting about warner media who had a huge shake up week before last is that they have great programming hbo is producing shows everybod wants to talk about. Youre one of the few people that has downloaded the hba max app you will find all sorts of highquality stuff but they kind of stumble givin people away access to pay for it has been huge consequences for them. Hey, ben, as the power and paychecks of these traditional studio executives have been diminished is there a parallel disengine on the digital side on key men and women running these new media outfits or have we not seen that yet . I think thats the real question, the guy running warner media, rent hulu for a while and much more a product, Digital Media guy, thats who is running these things with the exception of disney. They want people who are in retail, not whole sale theyre focused on getting things to consumers, not making deals with fellow moguls theres also history in hollywood of people like that being chewed up and spat out and one who died last week, the line, constent king, that pendulum does swing. An have had to figure out what are the hit thats will draw people to keep people in these apps while also giving them away for people to see them thats what were wrestling with right now and everyone is chasing netflix. The title old hollywood lets talk about big bloft blockbusters everyone is framing this year as a big blow as they cant have traditional releases, is is there opportunity there . How have some of the paid for over the top releases gone for wouldbe blockbuster movies. Its the ultimate way of looking at it as you suggest the movie producers are freed of the theater owners in some way, in some ways this very oldfashioned business that are pulling back and from. This digital future. Nbc broke the embargo going streaming and infuriating theatre owners with trolls which did quite well i think a lot of these the Media Companies are looking for ways to break the strangle hold that the theater owners have, while trying to stand good with people who still do, and what these things reopen still will produce opening weekends where they make most their money. Its a real balance, complicated diplomatic situation and its also a question how much cash are you willing to shell out and lose now to bet on some future state. Youre seeing disney with mulan later this year. Kind of going halfway. They released a movie that we wanted to see. They dumped it on the stream earlier this year but i think for mulan they decided to charge separately for it and youre seeing realtime how they balance these things. A fascinating read, we appreciate you talking about this ben smith, New York Times. Up next we look ahead, big day for retail earnings, tomorrow we break down the key names every investor needs to be watching. The closing bell comes back. Na . Yup and thats faster . Faster, yea but is it reliable . Ah huh and secure you should consider making a big deal about it bigger . I said bigger oh, bigbigger deal bigger than what im doing . Its not complicated. A 5g Network Needs a 5g device. Now everyone including existing customers can get a free Samsung Galaxy note20 after tradein. Were back retail earnings kick into high gear this week we hear from walmart, lowes, home depot and more, more on that now, frank . Home depot and lowes trading at alltime lows and doubling from march lows earlier this week revenue and profit estimates increasing double digits year over year in the First Quarter of covid19. And Home Improvement retail sales improve as americans make their homes more comfortable those sales increasing double digits in each of the past three months to watch online sales growing from last quarter and expected to be the same this quarter if not higher. Back to you. All right thank you so much, frank someone, well, who has painted much of the inside of my house during this quarantine i can say home depot and lowes have definitely been the beneficiaries of that. Yeah its a massive trend and clearly those Companies Expect to do well walmart of course also likely to benefit from recent trends, it will be interesting to see to what extent they benefit to the likes of amazon who many a fantastic set who had a fantastic set of numbers amazon comfortably best performing sector at 1. 2 . You save that for flattering in terms of headline numbers. Nasdaq up but dow down 0. 3 highlighting slight breath in conviction even though we did edge closer to the record close on the s p once again but not quite there. But we had mixed data, mixed sentiment, there wasnt a lot for the market to hang its hat on today perhaps as some of the commentary comes in from these retailers they will have much more nuance to think about in terms of the consumer and how much they will have in their pockets after the expiration of the programs and what the outlook is like in past three months. Got a tiny leg up near the close but back to 0. 7 on the tenyear gold slipped last week after resounding gains yeartodate but up nice 2. 3 today and banks suffering partly because of the yields, and partly because of the setting Warren Buffett asia continues to be remarkably strong china up despite ongoing tensions in d. C. Between u. S. And china, well see if it takes a toll on u. S. Markets or Chinese Markets Going Forward. Okay thanks so much for joining me today and look forward to joining me later that does it for the closing bel bell. Fast money starts now. Welcome to fast money everybody, todays trader lineup tonight on fast it is a big week for retail earnings with some of the biggest names in the biz set to report so what stock should you be adding to your investor shopping cart we got answers call it a home builder home run,