And im brian sullivan. Crude oil falling again, and that seems to be hurting your investments today. The dow is down, not a lot, you can see 15 points, crude oil though is down 2. 5 . Many in the market not only watching oil but also looking ahead to Janet Yellens big speech later on this week. And of course were going to let you know everything you need to know about that coming up. Michelle. Hey, brian. Im michelle carusocabrera, heres what else is happening at this hour. Shares of Dunkin Brands up more than 2 tracking their best day since july 14. Automobile driving in the United States hitting a record 1. 5 trillion miles logged in the First Six Months of 2016. Thats up more than 3 from a year ago. Ralph lauren now joining speedo in dropping sponsorship of olympic Gold Medalist ryan lochte after he admitted to lying about being held up at gunpoint in rio. Lot to get through this hour. Going to start with the markets though. Market that no one seems to be trying to beat anymore. Instead, investors rushing into market etfs. Lets get straight to mike santoli at the nyse. Hi, michelle. Actually, this has been a trend thats been rolling for a while. The public has not been that e nam mored. Bank of america estimates more than 900 billion has gone into index funds including etfs since 2009. That compares to about 600 billion coming out of actively managed funds that actually try to beat the market. This obviously is really exacerbated a trend of fuer and fuer managers have new money to go out and seek those fresh ideas. Its creating also a little bit of an argument out there that maybe the tide is about to turn in favor of active management. As we know its been very hard for active managers to beat this market. Fewer than 20 of large cap stock managers beat the market in the latest year. It looks more like 15 in the last ten years. The public seems to basically say why bother paying up for active management when it doesnt seem to work. And you have these other trends of hedge funds being in retreat. So the contrarians out there are trying to argue that this is in fact when basically the tailwind will return to those investors that try to pick stocks individually. There is a counterpoint to this, michelle, and i think its actually very interesting, which is perhaps its the weakest active managers that are being forced to essentially shut down or do less when money flows away. And its only the skilled ones, the ones with the great records, the ones with the Better Process that are staying in the game, plus the indexers, which means the market could theoretically become even harder to beat over time. I will add also one final note, which is its usually in downturns, corrections, bear markets that active management shines. So perhaps its just a cyclical thing where once a bull markets been rolling for a while people say why pay more, ill just ride the index. Mike, thank you very much. So are index funds the way to go for investors as the fed preps the market for a possible rate hike later this year. Janet yellen of course speaking out at the jackson hole conference on friday. Lets bring in tim ang, chief Investment Officer at clearbrook global advisors, and joe tanies, strategist at bessimer trust. Tim, what do you think . Its hard to argue with the success Investment Funds have had in beating active managers. Sure. So shouldnt they be why shouldnt they be the core holding in most peoples portfolios . Well, index funds have been very popular over the past year plus as statistics show. 85 of active managers have not been able to beat the indices on a cost basis. But its been driven by central bank policy. When you have liquidity driving the markets, investors dont differentiate in regards to valuations. What they care about is getting exposure to particular asset class. So because of that youve had higher correlations amongst equities, stocks, Industry Groups within essentially the stock markets. The etfs have been the right way to go. We began, you know, joe, this year as i recall with a lot of chatter about how this was going to be the year that the stock pickers were able to beat the index funds. Because this is a stock pickers market. Youre just not going to be able to ride the indexes anymore. Hasnt turned out that way. And it hasnt turned out that way in some downturns as well. Well, i think you have to ask yourself whats really driven markets over the past year. You know, if you look yeartodate while earnings for the s p 500 outside of energy have been relatively flat, the s p 500s up about 6. 5 , 7 , suggesting this really has been a multiple expansion driven rally. I think in that type of an environment beta certainly serves you well. And i think the proliferation of etfs has made it so much easier for investors to gain access to them. What you have to ask yourself in this environment where we are in the Business Cycle given the expectation for volatility to rise, should you now consider moving a little bit more into active. Tim, i listened to everything you said. Youre an active manager, right . Well, we invest in active management. Right, right. Nothing you said convinced me that i shouldnt do anything but etfs. So active management today as youre starting to see some liquidity coming back, what youre seeing today is correlations breaking down amongst Industry Groups. So the first time, michelle, the past couple years weve actually seen active management, particularly even in large cap, small cap and emerging markets actually outperform over the past six weeks by substantial 400 to 500 basis point ver sis indices. First clue weve seen breakdown in correlations across Industry Groups that finally were seeing the ben fikefits from active management. So now would be the time even though it hasnt worked in the last couple years because of the fed . Yeah, particularly if you have Central Bank Policies varied where the fed is going to issue Interest Rates versus bank of japan, et cetera, yes, youre going to see that. Youre also seeing sector rotation, something we havent seen before. You have a lot of utilities essentially move the markets, become overvalued. Now you see rotations into health care, into technology, information technology. Joe, a lot of big themes here. I just want to know how to make some money. What looks cheap to you . Yeah, well, what looks cheap to us i think when you look at the equity markets broadly speaking, its difficult to find an area that looks cheap. But i will say in this type of an environment considering where we are in the cycle, it makes sense to move a little more towards Quality Companies focusing on the individual companies as opposed to sectors. And of course focusing more on alpha as opposed to beta considering the rally that weve had. Within the u. S. I think we lean a little bit more towards consumptionrelated stocks. If you think about the household sector and how healthy it is, we want to be able to participate and enjoy the benefits of a healthy consumer balance sheet. Tim, quick thought. You like some mlps, tell me which ones and why . We like tortoise. Tortoise has come down. Typically has a low correlation versus oil prices. We went as high as 80 correlation. Typically trades at 30. It also is dominated mostly by storage with a guess. So it should not be correlated to oil prices. And has a yield about 4. 5 . Tortoise sounds exciting, right . Yeah. Its not just a shell company. Oh, you are on. Eight minutes in. Only took eight minutes. Im done for the week. Even quicker than ryan lochte losing hes here all week, folks. Tim, thank you very much. Go to powerlunch. Cnbc right now, do not hesitate to see how joes playing this years president ial election. Biotech bankers certainly not taking the summer off because theres a huge deal in the Pharma Industry today. Pfizer paying 14 billion to grab a fast growing Prostate Cancer drug. Meg tirrell is here with more on the deal of the day, maybe the week. Maybe the summer. Although investors are hoping theres more to come. Pfizer today winning the battle for medivation paying 81. 50 a share in cash for about a total of 14 billion for medivation. Thats a 21 premium to where medivation closed on friday, but of course a lot more than where medivation was trading earlier this year when french Drugmaker Sanofi put it into play with a bid of around 52. 50. So paying quite a bit more than that today for pfizer. They say thats going to add about 5 cents to earnings in the year to come. So for 14 billion what does pfizer get . Whats up . No, finish, i get it. So theres an improved drug approved for Prostate Cancer, its more than 2 billion revenue drug pfizer will split with the japanese drugmaker, also two cancer drugs in the pipeline people are excited about being tested for Breast Cancer and other cancers. And then the second one is an m immunooncology. Do you have any good explanation for why the premium is so much bigger. The French Company comes in several months ago 52. These guys are coming in above 80. Thats huge. Why is pfizer willing to pay so much more . Are those cancer drugs that much more important to them . Well, they are important to them. This is an important area for pfizer. And the other answer i think is it was a competitive process in addition to we know that sanofi was at the table. Its been reported that celljean, gilead and merck were also interested. That could have driven the price up. Pfizer may have been under pressure to get a deal done after trying to buy a couple and showing its doubling down in the Innovative Products area and in cancer. Sanofi could have in theory paid more based on their tax structure, right . Pfizer is here in the United States. Sanofi could have done an inversion, which meant they would have had Financial Synergies which they could have paid even more if they wanted to visa vee u. S. Company, right . Yeah, thats a good question. Trying to accomplish with allergan deal invert does have a lower tax base. Buying a u. S. Asset using u. S. Cash to do that, thats a great question. Questions on the Conference Call of pfizer today said this isnt going to effect 2016 guidance, but whats it going to do to 2017 tax rate . They said theyd update us. Seems medivations board played it pretty well. They sure did. I would be super happy as a shareholder. 30 a share or roughly that. Yeah. Exactly. Thanks, meg. Thank you. All right. It has been five years since tim cook took over as ceo of apple. Stocks more than doubled in that time up 100 plus. Should investors be cheering or screaming . Why are so many people negative after the stock is up 100 . Well debate next. Plus, 77 days until the election, Donald Trumps new strategy, is it turning the tide for his gop critics . Not for republican and former congressman christopher, why hes voting for hillary straight ahead. For decades, iestors have used a 60 40 stock and bondodel, with little in alternatives. Yet alternativ can tap opportunities that traditional aets can aneven though theyre called alternatis, theyre tually designed to help meet very aditional goals. Thats why invesco believes people shld look past conventional models and make alternatives a core part of their portfolios. Translation . Goodbye 60 40, hello 500 20. Happy fifth anniversary, tim cook. Five years as ceo of apple. But are investors ready to pop the champagne . Josh lipton is live in San Francisco with a look at cooks performance over the last five years. Josh. Reporter well, michelle, lets start with what traders and investors focus on, the stock. Under cooks watch apple is up more than 100 . Total return to shareholder, so stock appreciation plus dividends clocking in at 121 . As for the top line apple enjoyed Revenue Growth of 113 through its fiscal year ending september 2015. In the three quarters since then though Revenue Growth has dropped an average of 8 on a quarterly basis. Turning to products, cook scored a home run with that iphone 6, which drove big jumps in Revenue Growth from 7 in fiscal year 2014 to 28 in 2015. As for the watch, analysts say it has to be decoupled from the phone to prove a real hit long term. Rbc estimates apple so far has sold 14 million watches, generating 5 billion in sales. Cook does remain confident about the ipad whenever we speak, especially its role in that workplace, though that product does now account for just about 12 of total sales. And finally, beyond devices cook we know has worked hard to expand the Companys Services business, so mobile payments and music and the app store in the past Year Services revenue has jumped to some 23 billion, next year cook says that business will be the size of a fortune 100 company. Of course apple is still dependent for now on that flagship product, the iphone. Some do argue it is in trouble long term. Theyll point to increasingly saturated markets and longer replacement cycles. Others like pipers gene munster are betting cook is going to expand and enrich that device with new Technology Like augmented reality. Guys, back to you. Josh, thank you very much. So, apples stock has basically doubled in the past five years. Not a bad investment. But if youre splitting hairs, and of course we will, apples return is only fractionally better than the overall market, 25 worse than microsoft, and about half the return of google over the same fiveyear period. And did you know that since the apple watch launched, not was announced but launched, thats tim cooks only new product line, apple shares are down 13 . Lets bring in jason weir, apple shareholder and ceo of and steven managing director at ubs. Theres a doubling over five years is a pretty good investment no matter whos running the ship. But compared to the other tech names its underperformed. Are you disappointed in apples performance . I would say the recent history, yes. I mean, i think even cook would probably admit that they overestimated the demand for the recent success. But, look, overall i give him a bplus even though you could argue its probably incomplete. We have yet to see the innovation theyre working in the labs. But hes kept a lot of the Core Principles jobs put in place in terms of a functional organization thats focused on customer experience. The north star of creating the best product possible. And also apple is a very Different Company today obviously than four or five years ago. Hes had to deal with the fbi situation moving into china and india, shareholders, you know, demanding dividends and buybacks, which jobs didnt have to deal with at the time. So i give him a pretty high mark. But the incomplete is for the innovation we have yet to see. Yeah, the innovation, steven, we have yet to see. That was my point about the watch statistic is that really its only tim cooks new product line as a ceo. Obviously he was there and he was involved in a lot of different things. But when you look at what they have created, not what theyre living on but what theyve created, it has been, i think, fair to say underwhelming in the innovation category. I think its been und underwhelming on the hardware sigh, which is of course where they make their temoney. The technology is not there to get the watch away from the phone yet. Where i think theyve done a good job is on the services side, we call it the platform side where apples created a horizontal platform with open operation programming and interfaces that incent third parties. Jobs was initially against the app store at first, and then he was convinced to do it. But theres no doubt that they monetize through hardware. So whether its a car, virtual reality, better watch sales, we need to see that over the next two to three years. So, jason, how do you grade tim cooks first five years . And how concerning to you is the year over year decline in revenues . Or the quartertoquarter decline in revenues . So our grade is about an aminus. You know, if mcdonalds didnt already have the mcdouble, they should name a sandwich after this guy. If you look at earnings, operating cash flow, stock price during his tenure, everything is doubled. R d as a percentage of sales has doubled. So theyre really trying to get that innovation, you know, going again and make sure that they have some Solid Products for the future. But in addition, you know, looking at the products that theyve launched, iphone 6 was a big win, looking at the deal they inked with china mobile post steve jobs, that was a big deal getting into china. Hes looking toward india now, which is going to be big. Looking at the apple watch, you know, theres certainly the jury still out on that, were more optimistic i think than the street on the watch. But hes introduced his first new product category and so far we think its done pretty well. In addition one of the things weve talked about a couple times on the product is the Software Side of the business, the app and software portion becoming a larger portion of revenues. Its up 10x, they eventually might hit the software multiple if we continue down this path. The company would like that. Is that then your view of why youre holding onto it . I see youve got the firm owns roughly 150,000 shares for clients. In theory you could have put that money somewhere else like a google and gotten even better performance. Are you satisfied you kept the money there . And are you keeping it there because you think finally there will be multiple expansion for apple where it has traded cheap to the market for so very long . Thats one of the legs of the stool to our thesis. You know, multiple expansion because it is cheap, because they are growing faster than the market. And there are some quarters like the last couple of quarters where they havent been. And we recognize that. Weve talked about that at nauseam. Apple, they still have the cachet, they still have th