Transcripts For CNBC Closing Bell 20130911 : vimarsana.com

CNBC Closing Bell September 11, 2013

11th and watching the upset and the terrible happenings, but that monday, september 17th, that was all about america. That was all about resilience. Watching those firemen and all those rescue workers ringing the opening bell sent such a message to the world. Im proud. I was proud then and im proud now to have watched this country and the people of america work their way back. You talk about the resiliency. How about the stock market itself. We have 350 points over the last three days. This september rally just keeps going. And you look at the history books, september is supposed to be a terrible month. Just not having it this year. Meanwhile, watch more on the show coming up, cant afford to miss the interview with carl icahn. Were going to talk about apple. You want to hear what icahn has to say. Stock getting slammed with disappointing investors with the iphone announcement yesterday. Icahn will be meeting with apple ceo tim cook, and well talk about his next investments, herbalife. Carl icahn coming up. Tell him i said hello. Definitely. Is it fun to own the ymca song . In a original case the lead singer of the Village People won back the rights to the song which he signed away three decades ago. The Police Officer of the Village People won that kis. Hes here in a very special first on cnbc interview to tell us how it all went down, what it all means. Is he going to be in costume or a suit. Thats what i want to know. Did you see that . Lets check the markets, an hour to go before the closing bell. You have the market near the highs of the day. Near 100 points on the day. About twothirds of 1 . Check the nasdaq, which is giving some back today. Giving the upset in apple. Stock down. A loss on the percentage basis. Check the s p, doing a bit better on the standard poors, up 1686. Another day, another rally for the dow and the s p 500. Lets check in with bob pisani, see whats driving the market today. Hi, bob. Hi. Apple is not affecting the overall market. The nasdaqs down a little but most of the trend, were to the upside. Put up the full screen. Were being moved by syria and china. The s p 500 is up seven Straight Days and emerging market etfs are up. The rally has been in cyclical groups. They tend to rally. I dont normally cover tenyear auctions. The important thing here, look at that. We had a successful tenyear auction. We saw a drop in the yield about four basis points. That actually helped the stock market in the middle of the day, particularly Interest Rate sensitive groups. Take a look at Home Building stocks. Boom, right up. Second week up, results of the tenyear auction. The s. E. C. Is going to be meeting tomorrow with all the exchanges to discuss that nasdaq trading glitch a few weeks ago. Remember the network that carries the quotes and trades when down for three years. Theyre all meeting, including the nyse, nasdaq, everyone, in washington. What i am hearing is the likely outcome is going to be a push to implement new Software Testing and regulation called reg sci here. Believe it, the rules requiring testing implementation of new software are kind of soft. This reg sci would tighten them up, have standards for that. Theyre ready to go, just reviewing them right now. I think youll see a comment tomorrow about hopefully getting real standard rules and regulations around testing. That will be the big thing. I think the s. E. C. Will make some kind of statement tomorrow. Hopefully it will include that. Back to you. Well look forward to that. Joining us right now in our closing bell exchange, Peter Anderson from Congress Asset management, our own jeff cox and rick santelli. Peter to you first, can this september run continue . It surprised a lot of people. Does it keep going . It goes to show you there are no real rules in this stock market right now. I do think it can be on a roll. I think the most important thing weve seen today is the verizon debt issuance. I think you can read into that and say the demand for those bonds has been so overwhelming. That gives you a bit of insight into whats happening in terms of Interest Rates. Im thinking rates will probably stay the way they are. Maybe slightly higher. It has not deterred longterm bond buying. The 30year bonds on verizon have been tremendously oversubscribed. That tells you volumes about the Investor Sentiment right now. Yeah, i think thats a great point, peter. Randall, do you agree with that . You certainly see a bit of the demand story when you see so much interest in the verizon deal and equities . Thats a great point being raised and broader impact happening on the market, making things a bit more positive than what theyve allowed the market to broond out in terms of anticipation. Youre seeing the economic dow turning more positive in terms of europe, whats happening in japan as well as better, not less nestle grecessarily great better news out of china. I believe thats allowing investors to move away from the safety trade and broaden out to more riskon type assets. Rick santelli, not even 3 on the tenyear can deter this rally. Taper seems fully priced in at this point. Does it not . At least from a bond market standpoint. You stole my thunder. Everybody i respect is a source. That was emailed around the globe. The taper is priced in. Maybe theyre right. The i dont think the fed has made up their mind, i dont think they have enough information. I cant wrap my mind around that and much less how its true. We had a great auction. I understand that. Nobody was more amazed than i am. Here we sit at 2. 92 yield. Bob pisani said great auction. We are now looking at the third or fourth highest yield close since july of 11. We havent come off much. I find it fascinating. I still say theres pressure in Interest Rates and i dont know how anybody can say whats priced in when we have no facts. What are you expecting in the next couple of weeks . Jeff cox, thoughts on that . Zooz z as we always see, estimates for earnings are coming down. I think the picture will get a lot different, especially in how we see the whole Interest Rate climate unfold. All this talk about Interest Rates, such an interesting commentary about the culture of financial repression we live in. The dallas fed came out with a report i posted on cnbc. Com yesterday, a lot of my media cohorts didnt Pay Attention to it. But they put a price tag on the financial crisis, upwards of 14 trillion. I think its an interesting number to think about the damage that that caused and about how this whole culture of easy money, leads to asset bubble popping. Ap out about income disparity since 1928, the year before the stock market crashed. Peter, its hard to believe fiif i could just i just want to go back to the verizon issue. I dont think can you overstate this. What bob was saying about yields being priced in, et cetera. If youre verizon, certainly you want to issue these bonds now. The thinking is i dont want to pay a higher Interest Rate when the fed does taper. I get that totally. I havent heard any answers about this, on the buy side, who are these people buying these bonds with the foregone conclusion that Interest Rates will be rising. Doesnt make much sense unless you say to yourself, we think that its priced in and we dont think were going to take it on the chin by buying new issue verizon bonds. Heres a question. We have had a big surge. Look at the sprint deal, junk bonds, biggest issuance ever. Is this Companies Just trying to get out, running for that exit door, trying to get the last big round of debt issuance before the rates start to spike . Well, if thats the case, fine. What im saying is you have to two sides have to make that market. I totally understand if youre an issuer. But if youre the buyer, you know, when i managed highyield bonds, i would sit on the sidelines if i thought things would go down in price. Hey, wait a minute what if the stock market goes down a couple thousand points because the taper is mispriced in or it gets more digital as we go, sir . I would think those verizon bonds, just like treasuries would rally and youd have principle appreciation as well. So, i dont know, 520 it makes sense. Weve seen a huge amount of people and investors go into high yield and corporate sector to avoid what they perceive as questionable sustainability in stocks. The fact theres a shortage of collateral, talk to anybody in the repo market. Seems like a rough game to me. Were going to make that the last word. Thanks to all of you. 45 minutes before the closing bell sounds for the day. A Market Holding onto a triple digit move. Former new jersey governor, jon corzine is asking the case against him for bringing down mf global be dismissed. Will it happen . Why does it seem after his moves collapsed an entire firm folks like jamie dimond and jpmorgan are getting a harder time from regulators than mr. Corzine is . Were taking a closer look at that. Jamie dimond wasnt a senator or governor, huh . What are you insinuating . Carl icahn owns a large stake in apple. Well get his take on apple and why hes now taking to twitter to announce his investments. Hes a big fan of twitter. Then the ymca song could lead to a change in recording rights. The Police Officer of Village People just won back the rights to the song. How much money is on the line . Well ask him live on closing bell. Welcome back. Dow is higher six out of seven days. Seema breaks down the big movers. As the dow sit on a triple digit gain, take a look at top performer, ibm up 2 , outperforming its peers in the large cap tech space. Facebook is another big winner, hitting an alltime high. Mark zuckerbergs fireside catch tonight at tech crunch conference tonight. On the downside, netflix shares under pressure. Btig analyst rich greenfield downgrading from new tal to buy citing valuation concerns. Shares have gained 200 just this year. Apple getting slammed after unveiling two new iphones. The 5c is being seen as not cheap enough for emerging market audience. Second, investors were hoping for a china mobile deal announcement but the street did not get that. In response, rumored apple suppliers are feeling the pain as well. Qualcomm, cirrus, all these names, trading lower. Back to you. Thanks so much. Meantime, former mf global ceo jon corzine wants the case against him toe be dismissed saying the cfc manufactured charges hes responsible for misuse of 1 billion in customer money. Mf global settled and mr. Corzine so far isnt facing any criminal charges. Its interesting. Is corzine getting off easy, compared to the governments relentless scrutiny and investigations of jpmorgan and jamie dimond, in particular. Turning now to securities to talk about it, tom curran, partner at patgar and abraham, and andrew. Good to see you. Is jon corzine getting off easy because of his political connections . No question. If anybody did what he did and his firm did, borrowing over 1 billion of customer money, no question the book would be thrown at him. Instead hes got civil charges and relatively watered down civil charges. Thats shocking. Thats not so, he was a former senator, former governor. You say thats the bottom line . Absolutely. Hold on. Hold on. Tom, your time is coming. Hang on. Contacts matter. When you have the sort of contacts that a former senator and former governor have, thats huge. I think thats a major reason why regulators havent lowered the boom on him. Tom . I think its crap. They dont allege he has a reason to know this they were doing what they were doing. They dont allege he actively participated in it. They allege he failed to ask or to see whether anyone was doing this or engaging in this kind of wrongdoing. Hes a ceo of a farflung enterprise. The cftc seemingly had a problem with him or his firm taking risks. Well, theyre a commodities firm. What do you think theyre doing . But you cant borrow customer money. You cant do that. No allegation he knew they had. They dont even allege it. From a control person liability perspective, it doesnt matter no, they have to hes the supervisor. They have to prove there was a reason to know you cant you just cant do it. This goes back to the argument that the same kind of argument you hear surrounding the financial crisis as we remember that five years later that not a single head of any single Financial Institution went to prison, was arrested, was charged with anything. So what . At what point doesnt the guy at the top have to have responsibility for something . You dont look at of course. You cant bury your head in the sand. Hey, tom, let me ask you this, do you think that its been its been overdone, whats going on at jpmorgan and jamie dimon . Theyre constantly shame on jamie dimon and jpmorgan for failing to throw themselves on their knees at the feet of the regulators. The regulatory Industrial Complex who thinks they must have done wrong because they make money. Shame on jamie dimon, i guess. You say shame on jamie dimon but not shame on jon corzine . Im not saying shame on either of them. You just said it. I am looking backwards did he just not say it . I was being sarcastic. Was this the regulatory Industrial Complex you dont look at results and look backwards to blame. Jamie dimon has five department of justice investigations going on right now. They have been absolutely hammered. What happened at mf global is much, much more serious. Hammered . They are resisting investigations. The more they resist investigations the more investigations they face. The regulatory Industrial Complex just because you say it loud doesnt make it right. Tom, if jon corzine gets to benefit from either the trades or whatever the people under him that he may not have known about explicitly, if he bets benefit of that by virtue of his bonus, the stock going up, why shouldnt he pay a bigger price when the ship sinks, even if he didnt know about it, the guy driving it . Do you seriously think facing a criminal investigation, having the fbi crawl all over you its closed. Having the cftc sue you isnt that appropriate . 1 billion is missing. If he has money he must be investigated because something bad happened. Its not his money. Its customer money. They are missing 1 billion of customer money. They dont even allege he had any reason to know his underling was doing this. You have to know. You cant bury your head in the sand and say, i dont know. Is that called willful blindness . How are you not knowing if youre the ceo sdm. Its ridiculous, tom. This is a multibillion dollar business. Do you know whats going on in the mail room at cnbc . No, but you know its 1 billion of customer money missing. The buck stops here. The buck stops at the ceos office up. Better know whats going on. Individual liability now. Now, were not talking about the company being responsible because the company settled up. But whos responsible . Individual liability whos responsible, tom . Whos responsible n your few . His codefendant look, she took customer money and the secretary . If she did that, then thats on her. Blame the secretary, not the chairman of 9 firm. Not the ceo. They dont even allege he had any reason to know. He has to know, tom. Hes the supervisor. Hes the head of the firm. You say that but the cffc doesnt say that. Security law says that. They have no proof. They have to show he had a reason to tom, that doesnt pass the red face test. Thanks a lot, guys. Thank you. Well, were looking for accountability. Were still looking. Thanks, guys. Appreciate your time today. 35 miss before the closing bell sounds for the day. A market up 96 points on the Dow Jones Industrial average. Starbucks and netflix may not have anything in common except one important thing. Theyre at or near alltime highs. Find out next why one of our pros says is the better buy. Which one is the better buy right now. And then hey hey macho macho man ive got to be a macho man ive got to be a macho man remember that tune . Now the original lead singer of the Village People has recovered Copyright Control over many of those songs. Find out how he plans to cash in on the luke ra tifr songs coming up on closing bell. Nascar is ab. Out excitement but tracking all the action and hearing everything from our marketing partners, the media and millions of fans on social media can be a challenge. Thats why we partnered with hp to build the new nascar fan and media engagement center. Hps Technology Helps us turn millions of tweets, posts and stories into realtime Business Insights that help nascar win with our fans. Two big names, two big moves. Talking about netflix and starbucks. Jolting to alltime highs. Which is a better buy for your portfolio. Good to see you both. Gina, lets kick this off with you. Netflix has had an over the top performance this year but you prefer starbucks. How come . Netflix, if you dig deep they have a negative tangible equity. Their profitability isnt keeping up. I prefer starbucks. Starbucks is a play on growth in china and the asiapacific region. Weve seen incredible growth there. Store count is up and theyre continuing that. And even with that enormous store growth, weve seen Revenue Growth up 111 for that region compared to 25 in north america. But the per store revenues are actually still lagging the rest of the world. Theres still enormous upside despite those massive numbers i just told you. I think starbucks has a much better fundamental story. J. C. , lets take a look at the charts. What do you look at for starbucks. Looks like a chart you want to own for the last year. Thats true. What i really like about this chart, i think it has upside potential. The reason i say that, if you look at a chart, you see two very bullish patterns that have developed over the last 18 months. Theyre both rounding. For the sake of this story, we can call them coffee cups. The first occurred in 2012 and ended in 2013. As approach approached the breakout point momentum picked up and shot higher. Last coffee cup pattern in the last couple weeks, momentum building up and stock price is shooting higher. One caveat i do have is both technical Price Patterns have a

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