Europes largely flat, same for the 10year as revised q2 gdp is largely in line. It is all about the fed today. Janet yellen speaking in jackson hole. 10 00 a. M. Eastern time. And right here, you will hear from former fed governors randy crosser in, fred mishkin and former and current vice chair of the Federal ReserveStanley Fischer at 11 00 a. M. Eastern time in reaction to Janet Yellens speech. To our man on the ground Steve Liesman, good morning, steve. Cant get over the dress. The clothes. Thats all right. Its were waiting at about an hour now less than an hour now for Janet Yellens much anticipated speech, but in the meantime weve had really interesting fed speak this morning right here on cnbc. Most of the fed folks were talking to see rates going up. Not willing to be necessarily nailed down to a timetable but Loretta Mester did say just about a half hour ago, that she sees the u. S. Economy improving enough for the fed to raise rates. I think well have some strengthening in the second half of the year, yes. I think the economy is on a good track. I think the employment numbers show that. The Inflation Numbers are coming up slowly and below our target still but moving in the right direction. So jim bullard also sees improvement in the economy but he has a different foreca. Mester sees rates going up and, you know, about maybe a couple hundred basis points of tightening over the horizon. Jim bullard wants to raise points one quarter point and leave it there for 2, 2 1 2 years until the situation clarifies. Well see if janet yellen gives us any hint at all about whether or not were going to have a rate rise, at least some time this year. I doubt well hear specific guidance to september. Also what framework she uses to decide how to raise rates. And thats another question well hopefully be able to put to stan fisher the fed vice chair, with hell have him on live from here and exclusively at 11 30 and his thoughts on the fed chair speech. Good stuff this morning. I know you have to go but well talk later in the morning. Steve liesman, of course, in jackson hole. As steve said, were going to be looking for color and character here. After bullard today, george today, kaplan, dudley, does she back up any of this notion that september, december is live so to speak . I think the betting is she will definitely echo the sense that the economy has come a long way, you cant declare victory but we are close to our goals, but i think the punch line that comes after that is whats not really known. In other words does that mean your pea in a hurry mean youre in a hurry to get to the next rate increase or where theres this period that there isnt much urgency to get there. The markets are in a neutral going into this. Shes hawkish and the dollar surge but everything is right in the middle of its range. Why theres so much anticipation because its been such a cat la listfree, directionless kind of market in Light Trading theres a lot of hype around the speech and when you go through the economist notes they say, dont expect any meaningful details in terms of when the fed is going to hike Interest Rates. The best guesses come unbalanced. Balance is the key word that economists are expecting for her, potentially short term hawkish, suggesting the economy continues to make progress but longer term, a little more dovish, perhaps, this idea that the fed still has tools to fight weakness as it comes up. Joining us to discuss the question of the moment is randy kroszner, economics professional at the university of Chicago Booth School of business at jackson hole and will be moderating or discussing in a panel tomorrow. Good morning. Great to see you. So whats your best guess as to what sort of message janet yellen will convey today . So i think shes going to be talking more broadly about the tool kit and about the various things that the fed can do if something may go wrong, not talking about the immediate issues of well are we going to raise rates in september versus december. I think she will leave that for the fomc discussion when more data comes in. But you know the markets will parse every word. Of course. Even if she doesnt say september or december or this year they will read into how she characterizes the strength of the economic recovery, how do you characterize that given what weve seen in terms of better jobs numbers but sort of lumpy and noisy Everything Else . So weve seen reasonably good job growth. Weve seen reasonably robust consumption. Weve seen reasonably not so good investment. Both the productivity investments and the payoff from it and the amount of investment has not been very strong, and its one of the key challenges and key issues that fed will be thinking about. If they start raising rates does that make it more difficult to get investment and make it more challenging to have more investment going forward. Or is the economy sufficiently robust that we got to get going. You know, one reason that i think a lot of folks in the market are maybe frustrated or at least confused and tired of this process is simply because the data can be played either way. You can basically say weve just about reached full employment and were on our way to perhaps our inflation sghools sugoals a there. Sure. People saying nominal gdp 2. 5 in the last four quarters whats the rush and the risks of going too soon are greater than those of waiting. So how does the fed come down on this exactly . Well i think youve described the different camps that are around the table and i think janet tries to build a consensus. I think its clear that fed broadly is in a movement up mode. The speed is something that theyre debating. Its likely they will move by the end of the year but for some sort of calamity that occurs globally, but i think they are in a path but its going to be a very gentle path. I think the extent that janet does tip her hand at all its going to be that any rate rises will be very gentle, very gradual, not to upset the economic apple cart. Randy, bullard did a nice job this morning expanding on his framework trying to separate us from history in a sense, sort of set aside this space were in. And talk about policy for this block of time that exists right now. Is does that carry a lot of water in this years jackson hole . I havent heard a lot of discussion of it yet. Maybe it will come up during the formal sessions going forward. I think thats jims approach. Im not sure others have taken to it yet. How much are you hearing about fed credibility, randy . This increasing awareness it seems like on the part of the Federal Reserve it is having trouble meeting its mandate and its goal on inflation and that theres a lot of discussion about what data dependence means and whether their communication policy and Central Bank Policy is effective . Well, the question about meeting inflation goals has been one that hearing in lots of discussions for people around the world because most Central Banks are not meeting their inflation goals and having great challenges doing that. The certainly the ecb, the bank of japan are examples of that. So certainly theres a lot of discussion i think there will be a lot of discussion over the next few days what tools will be effective for the for the Central Banks to get to their goals. One, what should be those goals, certainly on the table are do we have the right goal of 2 inflation and second, how do we achieve that. This will probably be one of the things that janet yellen will touch on, what are the tools that allow us to get to the particular goals. Randy, if she is thinking and if the Federal Reserve is moving toward raising Interest Rates, given the progress weve seen in the economy, as early as september or december, doesnt she need to be more explicit today on that kind of maybe not time frame, but setting the markets up for that given that theres only a 50 chance priced into the bond market for december . Well, i think they want to see a little more data before making a strong commitment and i think thats not unreasonable. I also think that its not just the traditional aspects of data but concerns about having Interest Rates low for so long, that there could be some unintended consequences. Were seeing frothiness in commercial real estate markets and some people will be making an argument not just based on inflation and employment but also on some of the Financial Stability issues. Well, its an interesting point, how the market are basically priced after the long period of very low Interest Rates. Do you actually think that the fed is going to want to drag investors attention in that direction as they tried seemingly to do back in the spring and keep the markets back on their heaels and were worrid about froth in these areas and yet havent delivered the policy rate increase except once this whole cycle . And so thats why there are these different camps some people put more emphasis on, the froth, some people put more emphasis on the low inflation, some people say well, we really need to be much more worried about the potential for inflation because the labor markets are so tight. Unfortunately, this is unchartered territory and reasonable people can disagree and certainly we will be seeing a lot of disagreement here. Theres mostly reasonable people here. Thank you for joining us in jackson hole, and your panel, Central Bank Balance sheets and stability. The former Federal Reserve governor. Thanks a lot. When we come back, of course, well be on top of Janet Yellens jackson hole speech throughout the morning after she delivers her remarks stay tuned for an interview with fed chairman Stanley Fischer. First bill ackmans comments about herbalife taking a toll on the stock. Another look at the premarket as we are now 34 days without a 1 move. Does that change after 10 00 . More squawk on the street from post nine in a minute. [a[aouer] foofna . Or sales ent . The mmer of audi sales ent is he. Geup ta 5 500 bonus on le auds narrator it wasnt that long ago. Years of devastating cutbacks to our schools. 30,000 teachers laid off. Class sizes increased. Art and music programs cut. We cant ever go back. Ryan ruelas so vote yes on proposition 55. Reagan duncan prop 55 prevents 4 billion in new cuts to our schools. Letty munozgonzalez simply by maintaining the current tax rate on the wealthiest californians. Ryan ruelas no new education cuts, and no new taxes. Reagan duncan vote yes on 55. Sarah morgan to help our children thrive. Bill ackman, carl icahn back in the news regarding herbal life, his short taking a surprising twist. Kate kelly joins us live from 30 rock. What a story this morning. I know, carl. Andrew and i talking about it on set in the 6 00 hour scratching our heads because the wall street journal had written a story suggesting ackman was going to at least partly buy out carl icahn. I talked to ackman and he called the show. He essentially said heres what happened. Jefferies was working on icahns behalf to help him sell out of his 17 million share plus position which by the way makes him the top shareholder in herbalife and they asked ackman if he would be interested. He said absolutely not. They came back to him a second time and said, were trying to put together a group of buyers are you in, and ackman said on Second Thought i would be willing to buy a few million shares if only to help get carl out. Im going to flip it the very next day because im still very, very short this stock and i think its going way down. Heres what he had to say about the signal that carl icahns potential block sale sends to the market about herbalife. Take a listen. Carl, i would say is the lea leader of what creates the confidence in the company. With carl exiting its over and over quickly. The sooner he sells the better. So, obviously, very negative terms coming from ackman about what the icahn sale could mean and he said that some of the major long holders it was his belief at least were on their way to getting out including fidelity and also bill steerits. We have calls to find out if thats the case. F if it is it has not shown up in the securities filings yet. We know that ackman is very, very short the stock. Its been famously called the billion dollar short. He does not dispute. However it would cost him potentially money to buy icahns shares even if he were going to flip them in a day. Heres when he said about the economic of that. Take as listen. If i bought 3 million shares at 55 and i told them at 45, you know, ill lose 30 million but weve got more than a billion dollar short position and getting carl out would help. I would spend 30 million to get carl out. I would spend more. So carl, you can see why this might make economic sense to ackman. Its an interesting and ironic new twist to what, of course, is a very long running story about two titans of investment on opposite sides of this herbalife trade. Very curious, i wonder and weve got sara and mike here as well, what carl must be thinking about jefferies at this point. Yeah. I mean his longtime broker, have to feel they want to survey everybody. In theory if bill ackman had an interest in closing his short position, this is an efficient way to do that. Actually. It would be at a loss. Unlikely given what hes been saying about herbalife but you to survey the street and this what kate points out here is interesting, if ackman would have seen this as a mechanism to unlock a huge chunk of supply of herbalife stock and put pressure on the shares it makes backdoor sense. Right. I mean i think that was the logic. When you see the story it seems bizarre because ackman within the last few weeks certainly since the ftc settlement on july 15th with herbalife for 200 million of course sent some negative signals about the companys Business Model but stopped short of calling it a pyramid scheme. Ackman has said im short this stock, not bailing out of this investment thesis. I think earnings are going to erode once the company has to abide by the terms of the ftc settlement and it may take a little longer but the shares are still going down. However, its not shocking necessarily to think that he could be changing his mind, given that they didnt call it a pyramid scheme and you dont see a clear and quick path to the stock going to zero as he long predicted. The opposite, kate. The stock has gone in icahns favor since he disclosed it back in february of 2013. Double digits higher . Sure. Sara, thats a good point. Ackman made a hat tip to icahn. If you bought with carl at that time, you did well. If you sold with him now you would do well. I think icahn bought in the low 30s and more recently north of 60. Fair point there. Great story. Interesting wrinkle we will watch this. Kate kelly at 30 rock. Carl icahn is back at delivering alpha this year along with other titans including jack lew and paul singer who has been making news the past couple weeks that a takes place on september 13th. Yesterday we saw the Dollar Stores taking a hit. This morning, different type of retailer is slumping. Which one why and what it says about the consumer when we return. A look at futures as we count you down to the opening bell and to fed chair Janet Yellens jackson hole speech. We are seeing futures up 27. S p up 3. More squawk on the street live from the nyse straight ahead. Wats, letrevi the ectric micecor ofhe bl. T paent. Was qui. As pt ur r rearch, i so cd lab sususuwithnotes abo, was qui. I the benefi of much mo data, and a t time toplanhe best tres i stayocused 24 7 never sle yod like lot o mecal studts ino i stayocused 24 7 never sle muplaythhwas createdt ock inde ovea as abenchmark for ag i stayocused 24 7 never sle withegs thateople ststheenmalpofoos ovea as abenchmark for ag i but insting isntabachiev. Itsutieving goals. Ovea as abenchmark for ag i inscliesing isntabachiev. Ing that today reires the a a expertiof higcon. Anslatn . Te toench the nchmar. Man yououaul [icic ing k you [click gamestop down sharply in the premarket. The video Game Retailer posting a quarterly revenue miss, comps down 11, gamestop citing a lack of new titles and decline in hardware sales. Some discussion about console redesign and is that why hardware was down 33. Thats going to get some attention today. The idea that customers are waiting for the next wave of upgrades. You know, in a sense the reaction to gamestops results goes a little against trend. This retail reporting season its been the favorite areas like home improvement, like, you know, off price clothing like, tjx. When everyone loved an area or Dollar Stores and they reported okay results they sold off. The structurally challenged one like best buy and Department Stores rallied because people said not so bad, these are cheap stocks. This is a cheap stock backing off. People are not sure how long they have. And they root for the shorts. To make it works. Wedbush came out and reiterated their overweight positive call and see it as a second half story around some of the upgrades. They see catalysts like the new playstation, september 7th, playstation neo, october 13, playstation vr and then some new games coming out. But well see. I mean thats hardware, software was a drag. Ecommerce was strong for the quarter. And thats going to be the play, whether they can shift to digital. Sure. And get more revenues out of that. I will say, this sort of demise of the physical gaming and video games, has been called for for a long time, has been a heavily shorted position and yet doesnt go away. Interesting to see how the Company Continues to evolve and whether it can do so. And that trades under eight times this years earnings. Its kind of priced for slow decline at least, maybe rapid decline, and, you know, that theyve been Cheating Death as you say for a long time in a sense that, you know, the kind of data richness of the games is going up and not as easy to have it displaced by online versions. You mentioned loved names. Ul ta, the beat and raise, com ups up 14. 4, beats a 12. 7 estimate. Although the beat