It will be the worst month since may of 2012. Europe still in the red as well after german retail sales unexpectedly dropped. Road map begins with markets in a Holding Pattern on this last trading day of the month. While deliberations by the u. S. And allies over intervention in syria stretch on. Meantime, a new nbc news poll finds roughly half of americans are against military action. They are kicking off that iphone trade i told you about earlier. And ge reportedly set to spin off its Consumer Lending business. Well talk more about that, too. Futures pointing to a slightly higher open on the last trading day of the month as fears of imminent military action in syria ease. The uk voting against joining any military action. The white house says the president will decide on a response based only on u. S. Interest and nbc news poll shows 50 of americans believe that the u. S. Should not intervene in syria. Never the less, guys, all the papers this morning, the journal, the times, the ft, saying that the u. S. Is prepared to go it alone if thats what they think they need to do. Yeah. It looks like to me the takeaway marketswise is because thats the case its probably more likely to be eliminated, more likely not to be a twomonth bombing campaign. I doubt if investors are going to be talking about syria as a swing factor in a big way one way or the other month from now. That said, we have to get into september which is historically the worst month but also an incredibly volatile month. Not since 2005 has it had a sub2 move in either direction. Wow. This year you have many excuses why it might still be jumpy. What i take calm for the is the market attitude, the psychology has gone a long way towards kind of coming to terms with that. Were seeing the volatility index has not backed off even on up days the last couple of days. Youre welling up the clinching up in advance of all of that. Doesnt mean its not going to be continue to be jumpy but i do think that everyone is on the lookout for it at this point. It does seem to be the case when you can identify the risks out there its probably not the risks that have identified. Theres a little bit of this. T it has to be priced in, carl. All months, you know, the dig dow stocks kind of let us down. They were for sale all month. Emerging markets to me is the thing that is not predictable. Theres not a date that says heres when its going to be figured out or not figured out or a decision is going to be announced. Headlines this morning that a story from reuters saying that there are about 12 currencies or so countries who are struggling with Peoples Trading basically out of their surns currencies. India may be trying to rally support with all of these different countries, why dont we act together. This is going to be one to watch. Volume today will be interesting, especially after we get into the middle of the day. Well get chicago pmi and michigan. Theres some stuff going on. I just wonder if theres people around to trade on it. We already had some interesting reports this morning. This july consumption report is an important one. People want to know what the Third Quarter is going to look like. We had better news in the Second Quarter. Are we still in a period where good news in one quarter sets the bar higher for the next no, the threshold of surprise goes up a little bit. I do think right now the market doesnt want to see real soft data even though its now being july consumptionwise was not great. Theres a expectation that the fed wants to do less in september. Almost certainly than you want them to be doing it because theyre reacting truly to better data and not just because. Yeah. As we said, the dow is on track for the worst month for more than a year. How syria and the latest impact data. Michael jones, chief invest ms officer with Riverfront Investment Group and westbury. Good to see both of you. Are you ready for september . Do we need to buckle up . I dont think we really need to buckle up too much, carl. I think were living with a case of almost hypocon degrkocohypoc. Theres always been things to worry about. Yes, theres been things to worry about but pretty consistently weve come through this with the stock market up and the economy growing, 2 growth, roughly. And i expect that to continue. In fact, i expect the economy to accelerate as we get toward the end of the year. So, sure, it could be a little bumpy but i think investors should look through that and be investors. The stock market is still cheap. And just hold on and everything will be okay. But, michael, its precisely that acceleration which has alluded us here. Why do you think that now, if you think that now is going to be a turning point, the second half will finally see, you know, what has so far not happened, which is couple of quarters back to back where we get upwards of a 3 print in gdp. Keep in mind how much damage the economy has absorbed from washington this year. We started off with big tax increases. Then we went right into sequestration budget cuts. The Third Quarter, you know, hours work i believe is coming down because employers are adjusting hours work to avoid obamacare, that 30hour thresho threshold. Off had something pretty big coming out of washington that has impeded economic growth. As we move into the Fourth Quarter youre finally kind of unshackling the private sector from what washington has been doing to it. I think thats where you see the acceleration. Curious, as well. Youre talking effectively about a policy thats coming out of washington, obamacare, et cetera, that could be having an impact. I dont know if people are focused enough on how much of a fiscal drag there is out there. If you were to take that out of the picture, the growth that weve seen so far might look a little bit better. Unfortunately it doesnt look like theres going to be any end in sight for that. Doesnt that argue, again, for a little bit more caution here among investors . I really dont think so. I think with that weve absorbed the higher Social Security taxes. Were getting used to whats happened with sequestration and it wasnt the disaster that some were predicting. And were now adapting on the private sector to obamacare. Were getting hours work where employers feel good about what their Health Care Costs are going to look like. All of those adjustments are happening and have happened. I think as we move through the Fourth Quarter here youre going to see the real underlying strength in the private sector. Remember, its miraculous when you think about it, that weve gone b from trillion dollar deficits as far as what the eye can see at the beginning of the year to now the cbo is saying the deficit is going to be less than 2 in 18 months. Weve made that transition. Still growing at 1 1 2 , 2 . Thats really a testament to the strength of the underlying economy. Brian, you mentioned that stocks still look cheap. If they look cheap in the early in the year when you sad sub 2 treasuries and junk bonds under 5 . Are they still observably cheap now now that you have a lift in rates . Yeah, i think they are, mike. And the reason is pretty simple. And that is if you look at corporate prompts and we just got a great report on corporate profits for the Second Quarter. Corporate profits alone justify higher stock prices. Even at current multiples. And in our models, weve already incorporated a higher interest rate. We always have. For the last couple of years, when we put the tenyear treasury into our models weve been putting in a 4 1 2 tenyear treasury. We did that even when the tre treasury was 1. 6. Were doing it today when its 2. 8. We believe the market can absorb these higher rates. To michaels point, i go back and look at the last couple of years, gdp has been running about 2 but if you take out government, if you just look at the private sector, private business investment, housing, consumption, weve been growing closer to 3 . So this economy has been doing better than most people think. And you can see it in these profit numbers. Guys, on that note, well see how we fair throughout the month of september and certainly today. Thanks a lot, guys. See you later. Thank you. Meantime, apple is a story today kicking off an iphone Trading Program at select stores today. John ford is live at one of the stores with more on that story. Hey, jon. Hey, carl. Good morning. Im here at broadway and 67th. The apple store here. They opened up just about ten minutes ago. I called them before they open. They said you can come in with the iphone. Theyll check the serial number, the physical condition of the phone and give you a credit toward a new one. There have been rumors about a program like this floating around for a while now. Its not clear how long until apple launch these widely or if it just is a storely store thing. One way or the other, old phones are kind of the new thing. Based on the fact that smartphone saturation has just become really high in this market at this point. And if you can trade in your phone and get a discount toward the new one, a lot of folks are thinking you will be more likely to buy the new one. Best buy also launching a program this weekend where you can come in with an older phone and get a discount toward an ipho iphone5. I dont know how much that is worth when apple is probably going to be announcing a new phone or multiple new phones in less than two weeks. So what is the older phone worth and what did you pay for them . What would you pay for them right now . The iphone 4s is worth 450 at this point. The, i phone5, 550. A new iphone, 650. Historically thats where its been. Youre probably to probably get a little less than half of this trading these things in. Kind of the car dealership model. Carriers launching new options for early upgrades based on the idea that you turn in your old phone. They like to resell these things into Corporate Accounts. That could boost margins for carriers, guys. Im curious because pricing is going to be so important for what consumers do here. Do you have any sense of how much theyre going to give you for these devices . Totally depends on the condition of your phone and which model you have. So its sort of the car model that weve all gone through and you into the dealership. You want to see the new models they have. They walk around your car and get a price. You probably wont get as good a price as if you sold this yourself on craigslist or ebay. But its convenient. If youre in there to buy the phone, they think you will take the money and go. Jon on the upper west side. May be selling them his own iphone. Well see, jon, thanks very much. True, you probably can get a little bit more if you do it person to person but theres the hassle. Other news, General Electric is planning to spin off the Consumer Lending unit of the ge capital division. Ge would reportedly get an ipo and it could come early next year. Big story. A continued decon glomization op ge. Its probably not a bad time actually to go out and get a value on this type of business. If you look at how, you know, the discover testimonies and cant tpital ones have done, th knit it together and made it upscale. I do think its probably one of the things thats easily kind of sellable as one unit. I had a lot of discussion about, for ge, they have their own reasons to do that they try to unwind part of what jack welch put in place. But others say it would park the end of sort of this three decade long consumer boom and what does that portend for the consumers in this country down the road . I see it a little more through the ge prism. Although the idea that ge no longer qualifies as a longterm Growth Business that probably does speak to that issue. Ge used to get a higher multiple back in the boon because of ge financial which was contributing the le ing thi share profit of the company. Consumers were acting different back then if you recall. Back then, ge was a aaa credit and could borrow cheaply and made it work, the math. Its a discussion of whether they find a buyer or spin it off. Finding buyers though has been a challenge for ge on a number of units. By the way, if it does an ipo, keep an eye on the index. Corporate spinoffs have been a bright spot in this market and so has the etf. Well try to get a chart up. Ge has been hanging in there. Might be csd. Still hanging around 23. 40 or so. When we come back, tensions still high in syria as u. N. Inspectors help to finish their investigation. When we come back, a live report from the area where w. The latest. Later on, the ceo of a company which was started in syria to see how his business is being effected and how hes dealing with the situation in that country. One more look at knfutures as w look at nont of august. The dow to break even only needs 658 points today. Back in a minute. Of august. The dow to break even only needs 658 points today. Back in a minute. Of august. The dow to break even only needs 658 points today. Back in a minute. Moof august. The dow to break even only needs 658 points today. Back in a minute. Nof august. The dow to break even only needs 658 points today. 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They also deployed various iron dome antimissile batteries up in the country, including in the north and including two here in tel aviv where weve seen missile t attacks before, primarily from gaza back in november. Also Israeli Citizens are in a bit of a panic right now. Theyve been going to various Distribution Centers throughout the country trying to get their government issued gas masks because they feel if the syrians Syrian Government does attack israel in response to the u. S. , possible u. S. Air strikes they may attack with unconventional weapons including gas and chemical weapons as weve seen being used in syria. But that being said, israelis had polls in various newspapers. 66 of israelis say that they support u. S. And european air strikes against syria but if they dont happen, 77 of israelis say that israel should not intervene. Kelly . Atia in tel aviv for us this morning. Atia, thank very much. The dow is on track for its worst month in more than a year. 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Oil, eased back down. Gold, eased back down. You didnt see any major flight to safety in treasuries. Youve got to play detective here and put all of the pieces together and see if it makes one complete story. I think what happened late yesterday dlfs some anxiety. While it didnt get wide coverage he said some important things. First, the labor market had met the condition for tapering but far more important, he said were going to taper the first thing we should do is end the mortgagebacked supports. With the housing looking like it might be getting weak, it troubled the market. What hit me over the head like a two by four is he said his view of future growth was no better than 2 for the foreseeable future. And thats just above stall speed. So its going to be dangerous to start tapering if youre going to be just above stall speed. It seems like, if you want to get behind why the market seems to fear tapering. This is about all we can do or this is as good as it might get under this plan. And the other thing is, while you havent heard directly from bernanke on this, although he is somewhat of a lame duck, the other fed governors when asked about the emerging markets and whats going on in the currencies, said, let her mother worry. You know. Thats their problem. So that does not reassure markets. Thats why were a little volatile. Obviously emerging market is going to have two sessions after today before we get back. Amen. Right. We were just talking about september seasonality. But also the events we got to get through over the next five weeks, the fiscal year end, obviously. Obamacare enrollment, debt ceiling, taper, if