Meantime, a war of words on cnbc between j. P. Morgan head jaime diamond. Tell you whats behind that controversy thats been brewing for a while. After the bell, wilfred frost has an interview with bank of america ceo, Brian Moynihan. Stay tuned for that. Look forward to that very much. Now, the retail pain. Shares of coal sinking again. The hard times for traditional retailers might not be over anytime soon as amazon continues to outperform. They were out yesterday with a note reiterating the preaddition that amazon could become the top clothing Retailer Next year, 2017. How big of a threat is amazon to traditional retail . Lets bring in stacy and cou Courtney Reagan. We are getting horrible numbers from macys and kohls and others. Is everybody migrating to Online Shopping right now . You know, i dont think its just that simple here. Everybody is blaming amazon and saying, all of a sudden, what is changed . Amazon has been around for a while. The numbers are getting worse. Macys traffic was down 7 . Kohls traffic was down 4 pk . I think the consumer is under a lot of pressure. The other issue, a lot of companies are chasing the same growth categories. You know, growth has hit the wall. Courtney, Morgan Stanley out with a note about the amazon impact. Basically sees amazon and the Department Stores changing hands here. Amazon is 7 of apparel sales and could go up to 19 or 20. The exact opposite happening with Department Stores. I dont want to say i dont believe amazon could do it. Certainly, they have exerted strong dominance but clothing and apparel is tricky. Online returns for clothing is something in the range of 30 to 40 . When its instore, the return level is lower, Something Like 1 10 to 12 on average. If you want to make it profitable, its harder to do online. You have a lot of people that dont love going to the stores, but also dont love returns or getting a sweater that doesnt look like the quality they expected and fit is an issue. Doesnt mean amazon isnt taking share, but its not as easy to pull someone to shop for clothing as it is for toothpaste. I have been saying for years, its not brilliant on my part, but there are too many retailers out there. Are we starting to see that come home now as retailers, as you and courtney were saying, you are going after the same growth categories. Too many retailers chasing the same customer. I think thats a great point. While there are store closings starting to trickle down, we need a good 25 Square Footage haircut in general to the space. The other thing courtney pointed out is very important, not only is amazon going to struggle with the exchange and return rates, the company that is are transitioning online like a nordstrom, 20 of their business is online. They are struggling with the higher cost of being online and the higher cost of dealing with exchanges at the same time their brick and mortar operation margins are going down due to lower sales. Regardless, who could sell through Department Store and who could sell through amazon. Pvc, haines and childrens place. Some poised to benefit in either world, i think. Looking at amazon for a long time, the clothing manufactures and vendors look at them as a competitor. As they have seen consumers migrate there for a shopping platform, if you cant beat them, join them. You may have to go there. Im concerned about their dominance in taking their share. I worry what it does to the consumer if amazon is so powerful all commerce goes through there, the choice is limited. Are the choices going to go up . I worry about that. Thats the conversation we had when walmart started to grow. We havent had that with amazon, which is interesting. Tonight, we will hear from dillards and nordstrom. Thanks. Good to see you. Good to see you. Lets get a check on whats pressuring apple shares. Susan lee from the nasdaq side. Hey, susan. Apple macon tribute it to the nasdaq. The biggest point drag on the nasdaq 100. A good volume. This is behind the nikkei report looking at less orders on the back half of this year, which traditionally is a strong time to put in orders. There should be product launches and ramping up for the christmas season. This nikkei report zeros in on the largest contract maker of the world. We are running at 80 of 2015 orders this year in 2016. Theres no comment on this report. They tell the market maybe theres deceleration when it comes to smartphone demand and there wont be Ground Breaking features when it comes to the iphone 7 launch in september. Back to you. Thank you. Susan li at the Nasdaq Market site. We are watching the market capitalization of apple and alphabet formerly known as google. Alphabet has taken over apple here. Its down 32 from the record high, in february 2015. Again, it is the worst performer on that index since then. Not the only time thats happened, but probably one of the more memorable ones in terms of how that works. Highly notable, that is for sure. Difficult for the people on the dow, too. Its not like theres a huge gap between that and how the s p have done. The Closing Bell Exchange for thursday. Michael is back from destination wealth management. We have jonathan from meridian equity from post nine and rick from chicago. Jonathan, whats going on . You have one good rally, then a sell off. We are meandering today. What are you seeing . Look at the volatility and uncertainty we have had in the market this week. S p has had a 30point range. Dow up 2020 tuesday, down thursday. The market is looking for something to hold on to, whether its a good or bad headline, looking for some direction. We get both of each, dont we . Thats the issue. The headlines arent Strong Enough to move the markets, yet they are. Coming into today, with the futures up, markets back and forth. We had to wait until this afternoon, kansas city, fed president , came out with comments. That was something investors were waiting for and looking for. The uncertainty about what washington is going to do about interest rates, they were off the table for june, now back on. Investors are looking for direction. Today might have been a tip of the hand as to what we are going to see next week. Michael, what do you make of the big cap tech names here . Depends on the big cap tech name. I think alphabet certainly is an investable asset. Oracle, we have doubts about. We are not sure how they are transitioning to the cloud. Apple, everyone loves to hate apple right now. It depends on the time. If you buy apple for a twoyear time horizon, when the next upgrade cycle comes in 2017, forget 2016, i think you are going to be very, very pleased with how apple stock does for you plus you get a dividend. Tech, you have to be very careful and not get too exposed. We are seeing a bit of a rotation away from more higher leverage names to value cash flow names. Dividend oriented are going to be key this year. Rick, important treasury auction these last three days. Now that they are done, what do you think . What did it look like . You know, i was so surprised, dead wrong. I thought the 30year would resemble or rhyme with the ten year off the charts in terms of demand. If you look t all three maturities, this is fascinating. Interesting to know where investors and institutions of foreign Central Banks own it. They own three, four or five basis points lower. About the same amount of base points they are losing on tens, we have to see how 30s turn out. Thats not good. When you look at 10year rates, we thought we were going to make a beeline around the mid160s. But, here is the eighth day now, it looks to be a settlement in tens between a 1. 74 and a 1. 79 . Really, sideways is the direction at the moment. I really do think this may continue. One trader said, listen, when i look at the world and see gold, yes, its high but still 600 off the alltime high. When i look at yields, yes, they are low, but havent challenged them for the year. Whats it going to take . Cynicism, if rates arent going below 170, they probably arent going to this cycle. If gold cant make a better beeline for highs, consider whats going on with Foreign Exchange and rates. Whats the better time . It makes sense that markets are not very exciting. I think traders are taking a step back. What is your sense, michael of the picture . You know, rick makes a great point. The underlying story is, perhaps the economy is not as great as everyone thinks. The unemployment numbers that came out, a headline number of 5 , which is great. Below the surface, as steve said, rick pointed out in commentary the numbers arent really that solid. So, from my perspective, if you have low inflation, that is a positive for the economy. What about real organic growth . I just dont see a lot of real, organic growth. Thats why the market isnt migrating higher. Theres nothing to hold on to right now. When you have an environment where growth is sluggish, its tough to have strong rallies. John, i guess thats why theres a lot of skepticism of any rally on the trading floor. Tuesday was a prime example. People looking at each other saying why is the market up 200 points on the dow . We couldnt point to a specific idea. Thats right. There was no real cause for that rally. Thats what investors need to be worried about. When theres not a headline for it to move, expect it to come back. Thats what we saw. Investors are looking for anything to grab on to. We have retail sales tomorrow. We know how thats gone so far throughout earnings season. I think investors are taking risk off heading into the weekend. One thing, the skepticism about the rally and economy has been going on for some time. We have seen huge demand in credit markets, huge issue. Could be a 50 billion week and people are looking to plow because they dont trust equi equiti equities. If they are doing that, doesnt that make the case for stocks longer term while this continues . Who do you want to answer that . I dont know if thats the case. Kelly, i think, yeah, certainly there is tremendous demand, but i dont think, really, the two have much correlation. I think what you are starting to see is tremendous interest in fixed income markets because people are looking for better guarantees. I think people have more feelings of uncertainty in the markets. Thats why you see a robust credit market. Remember, activity is not going through the roof. This is credit debt issue. Kelly . We are not seeing this rotation out of equities and into fixed income. Theres a lot of money sitting on the sidelines back to last year thats been trying to figure out where to come into the market. As we get closer and closer to the election date, investors are trying to find, whats the next secure safe haven there . Its out there somewhere. Thanks, appreciate it. A lot of food for thought. 45 minutes to go. S p is up five. Dow has a weakness in the airlines. Meanwhile, bank of america chairman, brian minor ham will speak with wilfred frost. Start ups are having on the banks profits. Up next, peace in our time or at least in the Republican Party, maybe. Likely gop president ial nominee, donald trump and paul ryan meeting in washington. We have the results of the much anticipated encounter. New hampshire governor and senator gives us his take on the courtship and whether the two republicans can find Common Ground, coming up. You are watching cnbc first in business worldwide. Man 1 i came as fast as i could. Whats up . Man 2 this isnt public yet. Man 1 what isnt . Man 2 weve been attacked. Man 1 the network . Man 2 shhhh. Man 1 when did this happen . Man 2 over the last six months. Man 1 how did we miss it . Man 2 we caught it, just not in time. Man 1 who . How . Man 2 not sure, probably offshore, foreign, pros. Man 1 what did they get . Man 2 what didnt they get. Man 1 i need to call mike. Man 2 dont use your phone. Its not just security, its defense. Bae systems. Welcome back. A little over 40 minutes left in the trading session. Monsanto is reporting that a bossable bid. A market value of 40 billion and it is up a smart 8 1 3 per cent on the reports. Kelly . Donald trump and House Speaker paul ryan holding a key meeting in washington to discuss Republican Party unity. John harwood has the lowdown. The republican nominee met with paul ryan and other republican leaders. We have just now heard as donald trump was preparing to fly back to new york from donald trump over how he thought the meeting went. He said it was great, things appear to be working out well. Paul ryan summarized the meeting himself before cameras at the house afterwards. I was very encouraged from what i heard from donald trump today. I do believe that we are now planting the seeds to get ourselves unified to bridge the gaps and differences. From here, we are going to go deeper into the policy areas to see where the Common Ground is and make sure we are operating off the same core principles. That was not an outright endorsement. His caution reflects a cup things, risks on both sides. If republicans reputeuate their nominee or a large number of them do, it hurts the entire ticket. On the other hand, if they get too close to donald trump given how polarizing he is with latinos and women, that means danger for republican members in swing states. There are seven republican senators, one running in states president obama won twice and also in swing districts in house of representatives. It makes it more challenging for the party to build Going Forward in 2020 when paul ryan, himself, might be a candidate. This process is going to go on. It looks like it is going to end with an endorsement. Paul ryan is going gingerly toward that goal. Thank you, john. Our john harwood. For more, the gop will fall in line, broadly speaking with donald trump. Lets bring in judd greg, the former ceo of the securities industry and Financial Market association. We could go on and on. Lottery winner. Yeah. Senator, good to see you. Have you been having an out of body experience watching the Campaign Season unfold this year . Oh, absolutely. I mean, this has been something that, the only thing predictable is its been unpredictable. No conventional wisdom applies to the race at all. You know, your cochair, we mentioned your multiple titles here. Cochairing an initiative known as fix the debt. Lets take a quick listen and remind ourselves of what trump told cnbc about the federal debt. What do we do with all the money we owe everybody when rates go up and now, all of a sudden, we have to borrow at two points more, three, four, five points more. Its a real dilemma and we have to be very, very careful. I am the king of debt. I love debt. I love playing with it. Of course, now you are talking ability, you know, you are talking about something that is very, very fragile and should be handled very, very carefully. So, that led to the column in the journal today saying gop aversion to debt is gone for now. What are your personal feelings about this issue . How important is it that this is first and foremost and do you trust donald trump with the presidency in that aspect . As you said, i had a group that started off after Alan Simpsons group, their spin off, basically. Its a bipartisan group. It is to do something about reducing the deficit and our debt. It is a huge issue for our nation. If you want to talk something disrupting, our debt is closing in on 100 of gdp. Its not sustainable. If we continue to move in this direction, we are going to pass on to our kids a nation that is less prosperous because they have to pay off so much debt. It has to be a number one issue in this campaign. Clearly, its not on the other side of the aisle. Bernie sanders massive spending and Hillary Clinton is moving in on him. Proposals for a Single Payer Health care plan. Its got to come from the republicans and the republican nominee that we will have a great discipline to debt. The strength of paul ryan is he is a leader on this issue and he plans to and has put forward ideas of how to get the deficit and debt under control. Ideas republicans can gather around. He is talking to donald trump about whether or not he takes seriously the ideas put together by the leadership and rank and file. Ryan said you cant unify the Republican Party in 45 minutes after their meeting was over. The debt is just one of many issues where paul ryan and donald trump disagree and other members of the gop. Immigration. We could go on and on and on. Yeah. Where is the middle ground . Who has to blink to unify the party right now . First off, our Political Parties are structured to be big tents where they crowd and the process of reaching consensus. We are the government by consensus. Thats the checks and balances of government. Paul ryans role, he understands and made clear, he is trying to be a buffer between donald trump and his rank and file members that have to run for reelection. Trump tends to go off on his own on some of these issues and is not in line with membership and has to figure out a way to adjust that so members can run on their issues and not be labeled as being with trump on the issues hes supportive of. Its a delicate dance. John harwood is right, the dance hasnt been finished. Today is not a bear hug, its a kiss your sister type of event. Theres a long way to go before we develop a scenario where paul ryan is comfortable putting his membership at risk saying they are 100 behind donald trump. Do you expect, at this point, senator, to support trump . He looks like the likely nominee. Hes going to be the nominee, theres no question about that. I think he is going to win, to be honest with you. Theres a lot of cynicism with that. The way the race is shaking up. I said i would vote for the nominee. I am in the paul ryan camp. I would like to see definitiveness on the issue of how to address the deficit and the debt. Im concerned with the erratic positions he takes, occasionally, the reverse of what he said the day before on big issues like the debt and deficit. The issue like how to deal with the debt. He earlier said he would consider doing it as a private sector individual. You cant do that. You cant threaten the payback of the debt. You just cant do that. If you do, you create a fiscal crisis and monetary crisis. Let me go crazy for a second here. S