Amazon prime day a look at the Ripple Effect amazon is having on consumer goods companies. By the way, the shares of the company slightly lower in the session, and battle of the home echo wars. Goggle and amazon are slashing prices on their devices. 50 or more in some cases. And its its the final countdown. Were gearing up for big reveal of americas top state for business we are anxiously awaiting the result, and we will bring it to you later on closing bell. You probably saw scott cohn reveal that georgia was number two a little while ago reporter but we knew he wasnt in georgia. We knew he wasnt in georgia. We just dont know where he is right now, but well find out here on closing bell today lets begin on capitol hill where our ylan mui has the hills reaction to the emails released by donald jr. In relation to a meeting with a russian lawyer who claimed to have damaging evidence against democratic president ial candidate Hillary Clinton. Reporter Senate Majority leader Mitch Mcconnell saying that he has full confidence in an investigation that the Senate Intelligence committee is conducting into possible connections between russia and the Trump Administration, and now apparently the trump family as well. Mcconnell just wrapped up a News Conference with reporters saying he was sure that the committee would get to the bottom of what happened i caught up with republican senator john kennedy in the hallways here, and he said he was worried that this email investigation would be a distraction and throw a wrench into the legislative process clearly a distraction, but the president fired the fbi director he didnt fire the fbi the fbi is work being diligently to get to the bottom of all of this. Reporter a few other headlines from mcconnells press conference he said that thursday is the day that senators will unveil their new version of the Health Care Bill he also said about the debt ceiling that they plan to hopefully have a vote on that before the august recess and they will have a little more time to do that because he also announced that they will be delaying the august recess by two weeks. Back over to you guys. Thats what we wanted to ask about. You saw the market originally spike lower this morning in all the email stuff now its moving upwards and it sounds like this is the point that art cashin viewed that they view the august reves move that perhaps theres an indication for some for that agenda. Lawmakers need more time to move on key policy items such as health care and nominations and mcconnell blamed democrats for stalling that process. Their complete lack of cooperation is the reason they need to stay longer, but well have to see if two weeks is really going to make a difference. Okay. Ylan, thank you. Lets get more on how this is affecting market behavior today, and our Closing Bell Exchange from hightower is with us at most nine and so is Kenny Polcari and Rick Santelli checks in from chicago at the cme there. Kenny, we were talking about this earlier it would be pretty clear that the algorithms read the headlines about the release of the emails and down went the market and it left the humans scratching their heads wondering what the big sdeel about. Thats absolutely true. Technology is fun and cuts both way. You have smart a lg os that do nothing but read headlines and if the word is perceived to be positive then they initial buy orders and if its perceived negative they initial sell orders everybody said what really happened, and was the headline at all even that negative . Im not sure that it was so, so negative, but what happens they kick it into high gear and they take advantage because the market is out of line from where it should be and look what happened they supported it right at 2415 and then they take it right back up again. I think the socalled smart a lg os are the new dumb money, what do you think . I disagree. If you look at where money is being spend on artificial intelligence, computerized programming, all in the hands of amazon, google, facebook they are investing heavily in picking stocks where i think the fundamental analysis of stocks is going to be gone in 10 or 15 years. Already huge investors are making big bets on algorithms picking stocks based on trend following, based on sentiment and based on emotion youll see hedge funds and private equity funds and all kinds of funds spring up in the next five years specifically. I think id take the other side of that thats all im saying. I think theres still a place for fundamental analysis for sure on a day like today you see longterm effects on a piece of news like this dont really matter when pepsico beats numbers, when people still have to brush their teeth and fill their hair and turn air conditioning on theres still Consumer Staples and so on and longer term more and more stocks will be done by stockpicking computers. We could spend a whole hour on that. Im not saying its a good thing. Its probably an opportunity for those who can get in the weeds with companies and pick apart Balance Sheets and pick good managements and find the uncommon value, but im just saying more and more that trend is continuing. All right hey, rick. Play with that all day, im sure, but, you know, while we saw this selloff in equities, we didnt really see a rush to any of the safe havens per se. You did see yields coming down but that was mainly i guess the strong threeyear note action and the dollar index is hovering at year lows right now. The dollar index is kind of the and having a hard time holding ton to a 96. If you want to see a real currency chart, look at the euro yen or euro pound the euro dollar doesnt look bad either the dollar is doing better against the yen. I guess the currency that is of least investor priority to own these days is probably the yen which is very fascinating considering they have an export economy and they are working on a deal, trade deal, of course, with europe, also driven by export economies whose biggest economy germany export cars has done japan this is going to get very interesting to be sure, and do i have to weigh in you know, kelly, i agree with you on a lg os and computerized trades its ultimately going create a lack of volatility 99 of the time, and the other 1 its going to be rip your face off volatility but to be fair we dont know how many they sold on way down we dont know how many they bought on the way um for all we know they sold x on the way down and bought three times x on way up and actually made money no matter how you slice it, whether you like it or not, a lot of people on the floor 30 years ago did not like electronic trading no way tstop walmart, amazon, its a disrupter doesnt mean that its a different style. If you look at the fx markets, you want to talk about the share of computerdriven trading there. Its like 80 . Anywhere, just thought it would be fun to raise the point. Boy, theres something to think about for another day. Thank you guys, appreciate it very much. Thanks, bill. Thanks, kelly. Your thoughts on todays market action. Another big story today. Some of the amazon prime day a look now at the details of this day starting were you, courtney hi there, bill. Amazon shares are slightly locker the third prime day in a row that weve seen that pattern, but theres no indications that theres any cause for concern. 12 hours left for this years prime day and the cnbc had millions shopping by record levels at 4 00 a. M amazon devices, including its echo family and those fire tab lets are among the best seller. Discounts range from 30 to 60 on the tablets but hundreds of thousands of deals on a very wide variety of goods. The latest products with very steep discounts and have already should out a 23 considerate gold plated watch, thats 95 of and then youve got to vr head set with a controller if you want it, too bad. Its already gone. Fourpoint usb charger and also gone hays are been feely. The price of comparison side pride clag when he looked at the top ten deals. For smarters 40 of the deals were sold only on Michel Samson so that means you cant price compare on any other site. Now 20 of the deals were actually cheaper elsewhere this is even after shipping and tax. The remaining 40 of the deals that he looked at amazon did in fact have the lowest price by avere of 18 now analysts have been expecting sales to grow by as much as 56 over the estimates from last year or to as high as 1 billion on this prime day. No glitches have pulled down the system or app. We have catch point systems watching that for us today if that chanchings. Before you are get to eric, hang on there. I have a feeling about prime day, for example people are taking them to task they dont always have the cheapest prices. I dont think a lot of people shop amazon for the cheapest price, not that price sensitive. They are convenience conscious i speak with Michelle Carusocabrera about this all the time the personal consumable products like your face washes or shampoos where the margin is pretty small, she knows shes ordering those for convenience but not price but some people see 89 off and think of have to have it. A lot of these brand numbers thirdparty sellers and tom were in theful with a y you. Courtney, thank you lets get over to eric who claims all this Comparison Shopping is zapping out productivity. Kind of a fun exercise. We were concerned how much time and productivity people would spend on amazon rather than doing their work we estimated the value of the lost work is roughly around 10 billion. Think of it this way prime day lasts a full 30 hours, but people are only in their office for about a third of the time its estimated there are 85 million prime members. Lets just say they spend one minute as new deals roll out so you combine those numbers with gdp data and youre looking at 10 billion of lost worker time focused on amazon. Thats an estimate not all prime members will be shopping from work, and we mention none nonprime customers. The 10 billion might not be stolen from work it could be the daily bleed from everyday time wasters. Maybe its facebook or twitter or watching wimbledon that will actually suffer because of amazon. Youre nodding your head. I thought the same thing. There are plenty of reasons and things that distract people from their task at hand at their desk, but this is just one of them youre a lot of fun at cocktail parties, arent you, eric . Dividing it up and figuring out minutes. And i heard some people golf in the middle of the day, too, so amazon prime might take away from that. All right touche, very well done. Bye, bill. Seriously are we looking at a situation where people do have this loss of productivity . Well, 10 billion isnt a huge number either, i mean, in the context. In the scheme of things, youre right youre asking me, you want my take on it, bill we ask the questions. You answer the questions. Thats the thing. Right, theres always some event going on 10 billion is not a huge number on any driven day when you think about the gdp. If only 1 billion is getting sold, theres an inefficiency there where people are spending time in their computer where i may have been quicker to go down the stre and buy the shampoo in the store there are special deals today. It will take a lot more of the third year of amazon prime to figure out what is is worth peoples time in the long run . I think this is here to say. Look at all the free advertising they are getting from doing this. Eric, thank you you got it. Meanwhile, our next guest is finding that Consumer Packaged Goods Companies are reallocating ad spends to digital versus traditional media. Emarketer estimates that the digital ad spend will hit nearly 7 billion this year, about 2 of the total market. One of the companies that could benefit from this shift is amazon joining us now is the man behind the report okay lets get to the point here sir, and thanks for being here. Thank you. Amazon is a major threat to some of the Consumer Brands that we most are aware of pepsi who reported earnings this morning and all of the others, right . Right, exactly. I mean, the crux of this report really came from trying to understand what are the latest trends in the tressing market as it stands today and the Procter Gamble of the world, pepsis of the world, biggest were seeing pressure across thebert because they have a disproportion at amount of their dollars marketed the strength of their business which weve seen historically and thats distribution and now they are being disrupted by amazon, they are not really fighting back on that which is real putting amazon this is not new news and the fact that budgets are moving in the way that they are is concerning. Were showing you the biggest names and marketers. I want to make sure people didnt miss the point you just made we talked earlier about how viagra is not going to be advertising as much. Youre saying some of the biggest marketing spenders in this country will be pulling back because of amazon explain that. Theres two points to it. One, we could be seeing a downward pressure on the aggregate advertising dollars spent across the board which is 1 to 2 of gdp. Historically that number could see downward pressure of cpg and Companies Pull back in the way that we think that they may. And the second on amazon, if they are not investing in their brands the way they used to. You request expenalty m to see that as you put it, consumer packaged goods may be the new dialup thats the ultimate insult. Wow look, i mean, i was trying to catch a headline with that its true in the sense that the dialup companies focused on cash flow above growth, above all else and thats what the cpg Company Seems to be doing as well cash flow above growth. Yet another amazon disruption great to see you again. Thank you. Thank you. Were headed to the close for this tuesday with about 44 minutes left in the trading day. A lot of volatility, but were just wondering if it was really necessary. The dow is up 18 points right now. Microsoft is the preparing to make a big investment in Rural America. Well take a look at their plans as well as who is against it thats coming up next. And on the heels of aaron judges home run derby win last night, a new etf is hitting the market and involves baseball and the three other major league sports, too. Well talk about tips makeup and the sports rhett van behind it ceokh out to the show on fabo, twitter or on facebook what do you think about all of this youre watching cnbc, first in business worldwide look at me. You used to be the yes guy. What happened to that guy . Legacy technology can handcuff any company. But yes is here. So, youre saying we can cut delivery time . Yeah. With help from hpe, we can finally work the way we want to. With the right mix of hybrid it, everything computes. The power of a low volatility investing approach. The power of smart beta. Power your clients portfolio with powershares. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. More than 23 Million People in Rural America have no hack ses toss broadband and microsoft is looking to change those numbers. Josh lipton joins uses from San Francisco with the new details josh thats right, kelly so the news is coming as a bit of a surprise but by 2022 microsoft hopes to bring bebond connectivity to 2 Million People in Rural America as you mentioned, theres 23 Million People living in Rural Communities without reliable high Speed Internet service. Microsoft wants to change that by improving access through whats called tv white spaces or unus channs used to liver Broadband Access they will have the system up and running and brad smith talked about the issue today. This is an issue near and dear to our hearts at microsoft, Broadband Connectivity for the nation were not a telecommunications company, and we dont want to be one. Were not a broadcaster, and we dont want to be one either. But we are a Technology Company, and were a Technology Company that for 42 years has focused not only on building better products but on creating bigger markets. Microsoft tells cnbc its financial commitment is substantial but emphasizes its not seeking to profit from this project. Microsoft executives also talked about the role that the theres googles project loan and facebooks drone projects that hope one day will provide web access across the world. Thanks very much. It all sounds good and despite the microsoft move there is not a clear exact broadband path for Rural America. A former chief of staff himself at the fcc joins us now to talk about all of this. The first thing i thought of was the the earliest days of broadband as they gan the rollout. You know, we talked about how expensive it was, and the rural markets were just left out because the return on investment was just going to be so better is it better now or why microsoft is purr soog this now . Why did you think microsoft is doing it for precisely the reason indicated in the last second is that the more people who have beband the more people who can use their products ant bigger the market can be. Right. And they are not the only tech company as your reporter indicated, google, facebook and Satellite Companies including elon musk are thinking about trying to get into the business and expand it that way. Thats now kwai though . Does the cost offing a significance didnt years ago. If youre laying fibers or pipes, youre going to areas large and left dense, that makes it really difficult. The broadcast industrys response to this has been interesting because they are clearly not happy. Yes. It puts them in this odd position of having to