Looks like almost a half a percent drop for both the ftse and the dax in germany. In the u. S. , a packed Economic Calendar today. At 8 30, weekly jobless claims. July cpi and empire state survey. Then at 9 00, tick data. 15 minutes later, july industrial production. At 10 00, the philly fed survey and the National Association of Home Builders survey. And the consumer is in focus once again today. Walmart and kohls among the names to show results before the bell. Well be hearing from dell. This is a little bit of a surprise because the pc maker was originally scheduled to report results next week. No shortage of numbers to be running through. Lots to do today. In other economic news, u. S. Home foreclosures on track for a sixyear low. Foreclosure listing firm realty tracks shows 30,000 homes last month, thats down 31 from july last year. Though up 4 from june. Demand for physical gold soaring 53 in the Second Quarter. The World Gold Council reports the jump was led by opportunistic buyers in emerging markets at a time when the metal suffered record quarterly losses. India accounted for the biggest share, followed by china. Looking at gold this morning, up 5 bucks, 13. 38. A bit of Corporate News for you this morning. A u. S. Judge saying the California AttorneyGenerals Office can proceed with a lawsuit that accuses Standard Poors of misleading investors by inflating credit ratings. A Court Finally showing the judge rejected the rating agencys effort to dismiss that case. A little bit of other legal news this morning, the jpmorgan executives who supervised the traders at the center of the london whale scandal unlikely to face any charges. Yesterday, they brought criminal charges against two former traders. The complaints only make passing reference to the traders former bosses and neither former chief Investment Officer iona drew nor achilles mackris are mentioned by name. It refers to them by title only and says it puts pressure on subordinates to deal with the high degree of risk being taken on the portfolios, derivative trades that led to the losses. A little pressure but not this goes to the point you made the other day that we discussed, it is hard to charge the people above you with fraud if the people below you are also being charged with fraud because arguably the people above you were defrauded. Right. It is just interesting to see whether this was a firm wide situation that theyre looking at or whether these were rogue traders or someone who rogue traders are a rogue group that was acting in one way and trying to cover it up on the books in another. It now appears there is a criminal probe going on into the firm. So the fbi just looking at the firm, that thats not looking at a sort of system wide problem, thats looking at the statements and other things that were made publicly by people like jamie dimon, Doug Bronstein and others after some of the whale issues became public. Made to investors. To investors and they tried to tamp some of that down. The firm wide stuff would be civil. No. Thats the interesting part. Im confused by that. If it is criminal fbi and justice are looking more on a criminal basis at that. Unclear to me. At jpmorgan . At the firm. Not at individuals, not at jamie or Doug Bronstein or the individuals, it is at the firm. But they have not done this in the past, is that right . Right. What happens when if a firm, an institution like this were to be found criminally whatever in this case . Thats a good question. I have an idea on that. It is an awesome question. You could say does it turn into drexel and all of a sudden everything stops. They cant do business anymore. I find that astounding. Look at sac capital, the firm has been indicted. You can argue that firm maybe i would have thought if you thats a different thats a different regulatory regime, though. It is a it is not a bank h d holding company. You go back to what eric holder said, too big to jail. Arguably as a firm it is because if you think about all of the unintended consequences that Something Like that would create im still a little stunned to have things like that being tossed around by justice or fbi or anywhere else. It is hard for me to imagine that a company like jpmorgan is being considered in the same realm as some of the others. I want to just stress that im out of my league on this, in the sense of understanding this notion. I do know that banks have avoided criminal charges and gone out of their way to avoid that, because there is something to do with their ability to continue operating. I dont know enough about this. It makes me uncomfortable. I cant even believe this is the situation where you would be putting that in the same sentence. Being very tough. I think thats whats clear. That is. Thats a new regime out there. Thats a new regime. The question about whether youre too big to jail and also whether people actually stopped doing business with you is an interesting one. I would have thought, actually, with sac, for example, they have institutions, Goldman Sachs has come out, were still doing business with sac. But the idea that you would stop doing business with any of them just because there have been charges that have been made without anything without being indicted. Thats what happened. Arthur anderson, before they were convicted of anything, people said, we just cant have you as our auditor anymore because you are indicted. We cant, you know, were a fortune 25, 50, 500 company, we dont want to do witness with you. And thats what put them out of business. Maybe the world also changed. Lets you and i and andrew and becky do more work on this and figure out what these are. Ive come across this in my reporting career. And done some work on this. But the rules have changed dramatically. Right. And it is a different world right now. A post dodd frank world and there is a lot going on here we have to figure out. Lets get to whale watching of a different kind. Here are a few highlights. First up, bill Ackmans Pershing Square has a new stake in air products. We talked about this. The company is saying this, but we have talked about it here before. The firm is also dissolved its stake in mondelez. David einhorns Green Light Capital cut stakes in cigna, gm, Computer Sciences and marvel technology. It also took a stake in riteaid. It increases its stake in aetna and dissolves stakes in microsoft, hess, barrett gold, western digital, seagate and cvs. Dan lobes third point dissolve stakes in hess, spider gold, apple, delphi, and advi. What is that . I dont even know what that is. It cut its holdings in sprint, delphi, mylan labs and hartford. Took new stakes in thrm thermo, cooper tire. Trian had new stakes in dupont, gnc and sothebys. George soros added 2 million shares of his stake to jcpenney. Right now, lets get a check on the markets this morning. A quick note, Berkshire Hathaway coming out with its numbers now in terms of its stake, cut its stake in American Express. Wale go throu well go through it and give you some of the details as we peel away. Okay. Lets get a check on the markets. The futures are at this point indicating a little weaker. Dow futures down by 37 points. S p off by 5. You have oil in this morning and right now oil prices are up about 93 cents to 107. 78. The tenyear at this point is yielding 2. 735 . And the dollar right now, take a look, youre going to see, dollar is down against the euro at 132. 84. Also down with the yen at 98. 07. While were on the list, berkshire cutting the stake in wells fargo by 30 . By 30 . By 30 . Do you think thats a rebalancing . I dont know if thats a rebalancing. Look at the shares of wells. They have gone up and could be a rebalancing. Hard to say. There is that and then also the cutting of the stake in amex. Both things could be i would be stunned. Thats what it says. Were if there is a headline from reuters Berkshire Hathaway, cuts stakes in well do a little bit of work on this in the meantime. At 13 . On amex. On amex, right. Lets look at global news. We started bringing you this story yesterday when the numbers were smaller. Now the death toll in egypt climbing to 421. The Muslim Brotherhood pledging to fight back. Well check in with reporters on the ground in the next half hour. That difficult situation there. Time now for the Global Markets report. Carolin roth is standing by in london. How does your morning coming on to afternoon look today . Good morning to you, guys. We are seeing a little bit of a pullback in terms of core european markets. Having said that, it is nothing to be too worried about, because volumes are pretty low. It is a holiday across many markets in europe today. And we have had six weeks of stellar performance for the european markets, so, yeah, give the markets a chance to breathe a little bit and take some profits. The smi is a little bit of an underperformer today in relative terms. It is down by. 8 . Dragged down by earnings from zurich insurance, this is one of the Biggest Insurance Companies in switzerland. Stock is up by 3. 4 . It was hit by natural catastrophes, bad weather essentially, in north america. But also in europe. Net profit missing expectations for the Second Quarter, and companies also pretty cautious about its outlook. Last but not least, i want to show you what is happening in the currency space. Sterling dollar at a twomonth high, sitting at 155. 78. Getting closer and closer to that 156 level. This is on the back of better much stronger than expected retail sales for the month of july. Certainly benefitting from that heat wave we have been seeing in the uk. Euro dollar pretty resilient at 132. 82, back below the 133 level. And dollar yen seeing a little bit of softness at 98. 07. This is because the finance minister in japan pretty much quashed hopes of that cut in the Corporate Tax rate and this is what the markets had been hoping for. So we are seeing some yen strength. And on the back of that, we are seeing declines, pretty big ones, actually, in the nikkei 225. Back over to you guys. Thanks very much, carolin. Becky, are you still looking . Looking for some of these. Cisco shares, they are under pressure today. The tech giant giving weaker than expected revenue guidance for the Current Quarter. The company also plans to cut 4,000 jobs or about 5 of its workforce. Joining us right now is simon leopold, Raymond JamesCommunications Equipment analyst and thank you very much for coming in today, simon. Thanks for having me. They made a lot of talk about different things, actually beat expectations slightly for the Current Quarter. That stock was down 10 in the after hours on some concerns about what is happening in the Current Quarter, particularly with asia. What was the big concern there . Yeah, so i think there are two elements to the concern. One was the lower guidance for the october quarter. But i think the bigger surprise was the comment about retuesddi head count, 5 , 4,000 people. They refer to it as a realignment, and anytime with cisco reports we look at the choice of words pretty carefully. And in what we think theyre doing is trying to control costs. It is not a situation of trying to reduce costs or cut costs. But i think this is going to make investors nervous today. Why is that . When you hear realignment, hear i hate to say it, but wall street at times, when they hear about layoffs, they cheer on the news because they think it is going to be improving the cost structure. Why is it such bad news when you look at cisco for this . Cisco is a tech bellwether, an indicator for it spending, tech spending overall and the other word that came up on the call that was interesting is inconsistent in terms of John Chambers discussion about the macro recovery. And so i think heading into call, all of us, myself included, were pretty optimistic that things were going to be sounding a little bit better. And this did not support the idea that, hey, the world is getting better. It is choppy. Choppy, particularly in asia . Yeah, so they did bring up asia. Cisco had issues in china for some time. Thats not new. But india sounded good, but that was probably the only bright spot in asia. Japan in particular was tough. A year ago cisco had very Good Business in japan. So theyre facing a tough year over Year Comparison there. That is an economy that certainly took a toll this quarter. Is this more concerns about cisco specifically or the health of it spending overall . I believe it is some of both. The aspects of cisco specific are share loss here and there, competitiveness, for example, set top boxes for cable tv. But it is also a reflection on the overall macro, cisco is so big, so diverse, it does reflect on what is going on in tech spending. The overall macro, does that mean in addition to being concerned about cisco, youre concerned about other companies today too . Somewhat. Somewhat. I dont think that the macro recovery is turning around. It is just a very slow painful recovery. And so i think heading into this, we thought things were going to sound a little bit better. And theyre not. But cisco is looking at, you know, flattish subsequential guidance, not calling for a decline. They talk about controlling expenses, not cutting expenses. So these are really, i think, issues of tone more than a sharp decline. Chambers made some comments yesterday where he was saying Something Like he sees cisco really returning to be the top it company out there. Would you agree with that, or no . I still dont quite understand what he means by that. And it has been discussed for some time. I think when he talks about being the top it company, hes talking about position and sentiment, not necessarily being the number one revenue generator in all it because there is some really big players in that space already. So what do you do with the stock today . I hate the phrase buy on weakness. But i remain a buyer of this stock. We maintained our price target at 30. To us, cisco is not an investment that is a growth story. It is very much about the earnings. And our earnings estimates really didnt change. So why should our price target change . And so we do think that trading oriented folks may sell off the stock. Were not surprised to see it weak today. But from an investment perspective, we continue to like it, and we continue to be buyers of the stock. All right, great. Thank you. Simon, thank you very much for joining us today. Programming note for you as well. We will have cisco ceo John Chambers, hell be joining the show later this morning at 8 40 eastern time. Make sure you join us again then. Want to talk about the other headlines before we go to break or go to im told were going to wait. Well wait. Well wait until we get back. Changes on Berkshire Holdings. Well come back after the break with those. Coming up, why an economist is changing his opinion on deflation after 20 years. But first, as we head to break, lets check on the National Forecast with the weather channels reynolds wolf. Good morning, reynolds. Hey, good morning, guys. Lets look at the forecast around the country, even in parts of the tropics, were watching this one area near the yucatan for potential development. Not named yet, but going to be five separate aircraft that are are going to fly into the system and take a peek at it. Meanwhile, the chance of more showers and thunderstorms across the southeast. More rainfall for parts of the upper midwest and cool and dry for you across the northeast. Life is beautiful there. No problems to really deal with there. But more rain in parts of the southeast could be a problem. Scattered thunderstorms in the Central Plains and plenty of sunshine out towards the west. In terms of travel today, look for potential backups in miami, also atlanta, los angeles, a mix of sun and clouds, maybe a little bit of a rain layer, otherwise, no major issues. Thats a look at the forecast. We have so much more coming up around the corner on squawk box. Welcome back, e everybody. We have a wiquick note for you. It looks like some headlines are wrong. Were redoing the math now, well get you an update on the latest filings from the s. E. C. Now it is time for the executive edge. This is a daily segment that focuses on biffi igiving busine leaders a leg up. David rosenberg, frequent guest here, says hes finally giving up on his 20yearold deflation call. In a note published by Business Insider, rosenberg argues the deflation camp is way too crowded at this point. He suggests the fed chairman bernanke will be successful in his antideflation drive. And you combine that with an economy with less and less capacity, hoonly time before prices rise again. If youre an issuer and the time for refinancing is now, not later. If youre an investor, dont spend too long debating whether hedging your portfolio before the prospect of longterm Rising Interest Rates and that environment. Even as Central Banks continue to keep shortterm policy yields at the floor. Gentlemen, this is a big call for rosenberg to make a transition like this, it is something we should probably set up and Pay Attention to. Im not an expert. Im a student of steve liesman. Let me say he and others have been calling for this moment to happen for a long time. So im not this does not feel like the call. I remember him i thought saying something similar about a year and a half ago. Many people making this call. The problem is you got to mak