Are with us. Lets start it off with you. This idea that it is one of the bigger sectors relatively speaking, the s p 500, but its also, remember, one of the fourth worst performing sectors so far. Say a look at the year to date losers. Interesting stories lines start to play out in terms of the particular stocks and themes drieding the trading. Kohls is down 19 and fossil, belts, watches, that sorts of thing, down 21 as well. If you take a look at some of the other stocks that perhaps are on the other side of this, you see the winners. Off price retail, tj max up 5 . Ulta budy up 10 . Lulu lemon is up 17 . The biggest one everyone talks about is one that hasnt gained a lot so far this year only up 5 year to date. Its amazon. Com. But remember, one of last years top performers and courtney, i got to sashgs one of the interesting things about this whole discussion is this idea of these stocks as melissa, i dont know if there is a theme that drives all these together. But retail definitely a big focus. Why is this happening now . Melissa, there are fundamental shifts happening in retail. It didnt happen overnight. Its not changing tomorrow either. Some of it happened in the wake of the financial crisis. Some of it happened as a result of our 24 7 online culture. Consumers are asking it is worth the price . So for many mid tier, the saens no. Even looking at my own Shopping Habits and my peers, clothing budgets are skewing towards fast fashion tlachlt is h m, zara, top shop. Because of the price that you get, it feels right. Now many shoppers dont feel the need to spend 200 at a Department Store to get an on trend dress. That used to be different. That is working for Outlet Stores and tj mark. When it comes to category trends, at leisure, whether working out or not, it is very strong. But so is beauty. Thanks to selfies and social immediate yashgs everybodys phone has a camera. You cant be caught bare faced at any time. And convenience is king. There is a reason that amazon is eating everybodys lunch. They showed declining spending for nonathletic apparel, accessories, watches, fine jewelry. Consumers that count on tourists or retailers that count on consumers tourist spending, theyre suffering. When the collar is strong and tariff tax increase, shoppers arent coming to those places. Lets turn to disney shares down more than 4 right now. After the Company Reported its first earnings miss in five years. Martin crockett with fbr Capital Markets has an outperform on disney with a 111 price target. Revenues are up 4 year over year. Is yesterday a problem with disney or a problem with the estimates . Thanks for having me on. The reason the stock down 4 here, really two reasons. They missed on revenue. It is rare to see. It doesnt happen that often. I think this is Something Like in 12 quarters that they missed on revenue. It was due to the College Football playoff. They had a tough comp yielded from last years College Football playoff. Its really that simple. There was succession planning on the call. He says he has no plans what sofr to extend his contract beyond fiscal 2018. That made investors uncomfortable. Interesting s the problem really that people didnt like alabama versus clemson there . Or it is a deeper problem at a foot at disney . Theres not a problem here. The stock should not be down 4 or 5 . This was an inline quarter. Disney is different than all the other media conglomerates. They dont really steer the street a specific number in a quarter. Bob eger plays this very interleinte interleinte inter intellectually honest. They missed the street because there is very strange accounting and consumer production licensing tied to the fact that quarter started on january 3 thrd year and start ond december 28th last year. That drove year end minimum guarantee payments. That was it. I think that the tv sbiz doing good. That there are some concerns. I think cp licensing is 18 to 20 better. The theme parks will get a big jolt from the launch of shanghai. And bob eger will be here for another two years. There is nothing to worry about here near term. They have time to figure out the leadership transition. Answer davids point that investors were concerned not to hear bob eger say im willing to stay longer and obviously there have been some succession issues with the recent departures. Yeah, i completely disagree with. That there is no way he can say that if they want to hire someone to replace him. Say he wants to extend his contract right now. That would kill the search process. So that was not on the table. If anyone is expecting that, that is unrealistic. David, can you respond to what barton just said but your price target is marketedly higher than his. You both sound positive on the stock. Well, on the succession planning issue, the problem right now is that there is just really no clear cut candidate. Can you make a case for, you know, ben sherwood, the media fet works cochair. But hes, you know, somewhat green in the role. And he probably doesnt have the level of experience required to be ceo. You can make a case for cheryl sanberg from facebook. Its unclear whether she would even take the role. Can you make a kiss for john skipper. Im not sure if Share Holders are quite comfortable with that. Everyone is comfortable with tom stags. Right. Everyone was comfortable with him. And now hes out. There is just no clear cut candidate at this point. All right. Gentlemen, thank you very much. We appreciate it. Both of you see the stock moving up. 110 in bartons case, 129 in davids. Well get to the third stock rec in a second. First a news alert. Ten year notes are up for auction. Lets get to rick santelli. Rick . Auction day. Yes, 23 billion of ten year notes found new homes about 7 1 2 minutes ago. The yield at auction, 1. 71. That yield is lower than the lowest yield i saw in the one issue market which is probably around 1. 72. Lower yield, higher price. We give this auction an a. Everything about it is stellar. The last time we had a yield at a dutch auction, this low was 12 12 12. Its been a while. Weve had some 2. 70s, fwhaut is still a stellar amount of demand. 73. 5 on indirects. I have a 15 year data base. I couldnt find a higher indirect in this 73. 5. 11. 8 on directs matches. The 12 ten auction average, 14. 7 goes go to primary dealers. This is the first auction, of course, but well see two reopenings. Stellar auction. Corporates are all the range, seems though anything with a decent yield the find a fier, manufacture them. Sully, back to you. All right. Rick, thank you. Lets get to our final stock recs of the day, staples and Office Depots. Shares of both are costing investors a lot of money after a federal judge ruled the two cannot go through with a merger. But are these drops just the buying opportunity you were looking for . Senior Equity Research analyst with bbnt market analysts. Are you recommending your clients that they buy either shares of staples or office depo depots . Neither, or both . Neither, quite frankly. This is a real big setback for both companies. You know, there is very compelling strategic and financial rational for this deal. So now this deal is off the table, its really hard to make a compelling investment thesis for either stock. I think both are maybe lal oversold today the but for a long Term Investor sh its really hard to get behind either of these companies right now. Given the secular headwinds and increased competition. What is the long term outlook for staples and Office Depots . Do they have a long term outlook . I would say that, you know, staples will survive. I dont know if im necessarily sure they will thrive but theyll survive. Stap slz in a good position to take advantage of the fact that Office Depots sort of is dazed and confused. They put the oice max integration on the back burner waiting to see if this deal would happen. They also lost a lot of really good employees. Office depots, i think the long term outlook, its mercury. They dont have the scale, Balance Sheet that staples does. They dont have the profitability. Its clear staples will be around in five to ten years. With Office Depots, not as clear. Yeah, and now the two are competitors again, anthony. So theyre going to hammer each other over price. You may see deflationairy environment in that sector of the economy s there anybody that may benefit from the fact that this deal is not going through . There is one clear beneficiary and that is amazon business. Amazon business was established a little less than a year ago. Theyre already doing a billion dollars in sales. And thats growing 20 a month. In addition to that, amazon business is adding more and more b 2 b capabilities. They can do customer specific pricing. They can now invoice the customers. They can do tax exemptions. And thats one of the many reasons that we think the ftcs decision was plain wrong, nonsensical, ludicrous. Were going to talk to them about a official that is going to tune in. Thank you. Is there any segment of the economy that amazon is not involved in . I dont know. I just bought blue jeans from amazon. Get out of here. I d i bought a nice pair. They actually fit. There you go. Queen he lelizabeth unplugge. Were going to give you a look at elan musks hyperloop test in las vegas, nevada. Phil lebeau is live there. Phil . Brian, they think its the future of transportation and as you mentioned, were just a few minutes from a test run from Hyperloop One. Well show what you its about and have reaction coming up in a little bit on power lunch. Im in vests and as a vested investor in vests, i invest with e trade, where investors can investigate and invest in vests. Or not in vests. Wherthey found out whos beente who . Cking into our network. Guess. I dont know, some kids in a basement . You watch too many movies. Who . A Small Business in china. A business . They work nine to five. They take lunch hours. Like a job . Like a job. We tracked them. How did we do that . We have some new guys defending our network. New guys . Well, theyre not that new. Theyve been defending things for a long time. [ digital typewriting ] its not just security. Its defense. Bae systems. A rare moment from the queen of england shedding light on how she really feels about the kline hes, the exchange taking place at a garden party at Buckingham Palace on tuesday. It was filmed by a member of the queens own staff which makes you wonder why the palace decided to release that video. Interesting off camera or on camera remarks. There is always that layer where you are like what do they really think . And then there is this other layer with this particular piece of fill clm is do they want you to know thats what they really think . Yeah. All right. The uk and china to brazil. The brazilian president could be impeached today. Majority vote of the senate would force her to step down for 1 wi 180 days to undergo a trial. Take a look at the brazilian market. If rousseff is out, what will that mean . Lets bring in our analysts. Lady and gentleman, good to have you here. Katherine, this is an incredibly tradable event. Even her relection was tradable. When her polls went up, the stock market went down. When her polls went down, the stock market went up. What do do you when we go the event that has driven the stock market there . The correlation is one to one. The market is banking on imimpeachment. I think today is the last day in office as the president. I think if here on out market upside our down side will come from Vice President selection of the cabinet. Then his reform agenda and after that, either execution or potentially new elections by 2018. Faces a lot of hurdles when it comes to execution. Reforms are so necessary and so structural in nature that i think its such a big laundry list that hes lucky to get two or tleef them done. Bottom line, sell on the news here . I think there is upside. I think if he does come through, which i think he will come through on something, then there will be more upside. Michelle, i recommend brazil bonds, u. S. Bonds in december. Weve seen tremendous run. I think that you could see some more upside. With inherent volatility. David, does anything really change in brazil if rousseff is pushed out of office . I think it proves that the society and Political Institutions in brazil are work clg is a great sign. I think its important for developing the societies and developing economies like this to prove that the institutions work. Once were through this, investors can focus on the underlying strength of brazil. There is a great country. It is selfsufficient in food and fuel. 200 million population. They have a lot of dry powder. Interest rates are 14 there. They do vin flags at 9 . But there is a lot of things that could go right for brazil if you get this political corruption out of the way even a little bit. But on that note, david, there are so many other members of the congress, of her party. The Vice President who presumably is going to take over has issues himself. Irmean, a lot of people look at this situation and say okay, yeah, they are battling corruption, however, its so pervasive, the place cant be helped. Twothirds of the members of the legislature are twothirds of the members of the legislature are under indictment for something. So youre right. It is very pervasive. Its a big problem. But being able to remove this very powerful party thats been running brazil is a major accomplishment if it takes place. Twothirds of the legislature under indictment. What kind of Investment Vehicle you would recommend here, david . You know, the main etf, ewz is an easy one to get at. You mention it moved a lot. If you look at the fiveyear chart, it was almost double where it is today back in 2012. So you can see more upside in this as they invest in the environment. So if the currency weakens, you get a double whammy, right . Exactly. What youve enjoyed recently is streng njt currency and equities which i think will continue. Katherine, last word. You want to Say Something about the parliament . I agree. I agree with david. I would say to that the Netflix Series coming out which is the house of cards equivalent for brazil is going to be very, very good. This Corruption Scandal just keeps on going. Its not a real one, right . No, theyre actually is one going on right now on netflix. Wow. That will be incredible story telling. Thank you so much. Iran, iraq, isis, north korea, rush yashgs just a few thing onz the u. S. Defense secretarys plate right now. Today hes in sill con valley working to get big tech back on the government side. Defense secretary ash carter joins us live if a power lunch exclusive ahead. The first stock index was created over 100 years ago as a benchmark for average. Yet many people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Its time to bench the benchmarks. Perfect driving record. Perfect. No tickets. No accidents. That is until one of you clips a food truck, ruining your perfect record. Yup. Now, you would think your Insurance Company would cut you some slack, right . No. Your insurance rates go through the roof. Your perfect record doesnt get you anything. Anything. Perfect for drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claim centers are available to assist you 24 7. For a free quote, call Liberty Mutual at switch to Liberty Mutual and you could save up to 509 call today at see Car Insurance in a whole new light. Liberty mutual insurance. Gold is trading higher today. A few things driving this trade in the session. A weaker u. S. Dollar. Also Goldman Sachs hiking the price forecast for gold over the next if you years. We had paul singer saying now is the time to be in gold. Off the session highs of the close but higher today. Take a look at the metals complex. Green arrow as cross the board. Palladium is up by 2. 7 . Lets go to the bond market where that auction is stealing the headlines. Rick santelli . Absolutely. It was a barn burner auction. If you look at the intraday chart of 10s, the auction came at 171 for the new guy. As i said, it hasnt been since december 12th of 2012 that we had an auction with a yield that low. So lets use that date for several charts. Lets look at a ten year. Boy, theres a lot of 160 handle bottom theres. We havent seen one at 170 on this move since the seventh of april. Lets look at the hygetf. Its in the low 80s. It was at 94 last time we will a ten year auction at these levels. Maybe a lot of room to the upside. Dollar index was at 80. Currently at 93 and coming down. Maybe the most interesting chart of all, you know what its going to look like. The s p 500. That was around 1400 the last time we had an auction under 170 for a ten year. Currently at 2074. What markets you think are a bit vulnerable . Back to you. Thank you, rick. Still ahead, a Small Cap Stock that one analyst says will double. Well tell that you name ahead. Plus, were Just Moments Away from our exclusive interview with defense secretary ash carter. Stick around. Hello sh everybody. Here is your news update. Paul ryan scheduled to meet with donald trump on thursday to see if they can unify the republican party. Heres what he told reporters. This is a big ten party. There is plenty of room for different policy disputes in this party. We come from different wings of the party. The goal here is to unify the various wings of the party around common principles so we can unify. About 1300 u. S. , british and georgian troops starting joint exercises to day aimed at training the former soviet republics military for participation in the Nato Response force. The two week exercises are