Roll back begins with the fed. Chair janet yellen on the hill. Rate hikes, Balance Sheet, strength of economy. Speaking of yellen who might be the next fed chair . Carey co00s name getting another boost. And apple bringing down targets for iphone sales. Will it be a delayed launch for the 8. Futures up modestly after sell off sparked by donald trump jr. s release of email exchange. Yellen will testify before the house. She says gradual rate hikes will be needed to sustain economic expansion. Regarding Balance Sheet see says the committee anticipates reducing quantity to a level below recent levels. What got peoples attention is the idea that rates may not have to get as high as they were in prior cycles. I think what that is saying to people is we are going to take them up but you are not going to get inverted yield curve. There have been a lot of recession talk of late which i dont get. There is no recession on the rise from the companies. This does take that off the table. What it does put on the table. We have Bank Earnings on friday. If you take off two rate hike scenario and you see stocks trade down. This is not what those stocks want. I went back to when we had a twoyear high earlier this year. Causes the market to take a serious dip. Then we went up. Im not buying the theory that we should buy stocks when rates go down anymore. There are too many financials that need rates higher. This market cannot go up on amazon and boeing alone. Boeing, why do you throw boeing in there . Incredible. Up more than 30 . Its been a fantastic. The aircraft aero space market has been so on fire and that has become our industrial leader. People dont talk about it enough. I actually have not noted what a move boeing has had. Best component of the year. That is a giant u. S. Industry that produces a huge amount of jobs. You really want for banks to lead at the expense of everything. I want this 91, 92. I want the banks to have enough money to lend and return capital. I need jp morgan at 100. Really need to see that market leader. Huge number of people there. So whatever where are they out there. Im not with them. They are out there in the mountains. You want a wells, jp morgan city rally because that produces much more bountiful relth. I find a zero sum with technology. Buy facebook. It means you have to sell what is it excuse me which. Snap. We are going to get to snap. Trust me. Below 16 this morning. This is not enough. You get under the desk because that would be a good example. Put on a hard hat. You have to put on a hazmat suit. We will talk about those individual names. Gary co hen set to be top to replace janet yellen. Here is what he said to us when asked. I have a great job right now serving the president has been a dream come true. I come into work every day and very excited to be in the white house. Here is politico this morning. It is his job to decide if he wants it. He will probably want it by the time next february rolls around. The odds of trump tapping yellen again are close to zero. He would be worth maybe five percent in the s p. Im saying i would give him, he is worth i would spot them five. He is not an academic. Maybe consider the opposite of an academic. He did not spend a lot of time writing long memos. He is a practical guy. I think he is not a theoretical guy. I think he is a guy who understands the labor force better than any people i heard describe it. I dont know if you heard him talk about the economy and why wages arent going up he has a certain quality about him that makes me feel far more optimistic and far less gobly gookish. I know yellen is going to talk now for two days. She is ambean. You would rather hear him speak. He is a five hour energy drink. He would definitely be an interesting choice. We have been talking about this since day one. This notion of the economist saying we are going to appoint a nonlawyer to the supreme court. The guy has had his whole career in finance. I would love to have a fed sheet that understood finance in reality. The idea of an academic i said what would happen if you had someone like i remember how good rueuben was as treasury secretary. I think gary cohn. Do i know him from a previous life yes. He would be fabulous. Some of that previous life was at a firm that was concocting securities that were not, shall we say, of the greatest quality, some said betting against clients. Back to hearings in front of senator levin. Not fine moments. You can say he understood the root of the crisis. Donald jr. Would say there is a way to do it. Elizabeth warren would get on him. You would have goldman alums at treasury and the fed not to mention some playing the would he get the votes. Former democratic, who knows. Giant squid. I always hated that analysis. He admitted they did some things. Wasnt in denial. A long time ago now. I think this notion i think gary cohn is well respected on wall street. I think if you had an academic lets give someone not an academic a try. Wouldnt you love a guy who knows how to sell bonds . Got news regarding apple this morning. It expects a delayed launch for the iphone 8 cutting shipment estimates for september quarters. There is a quote sense of panic in the air at apple and that the company has been working to Fix Software Problems in the new iphone. Who knows who the source is. Tim cook is a real panicker. He is the guy you go to with two seconds left on the clock and no timeouts and at the 30. He has just become a football fan because he went to the super bowl. The idea is that this guy panicking, he is the coolest man in the room. Do they want the bugs worked out . Of course, they do. The easy good charge which we all really want. This is not a company that says if we dont get it out x day then we miss y quarter. Tim cook is not playing the analyst game. He is not buying the supercycle. Its not the way he thinks cht that is one reason why the stock has been the greatest of all time. What you are not saying is that it may not under perform in the near term or that there might be impact on asps. Someone will sell it. These are radekally different new parts of the phone. He wants to get them right. They dont put out product until they think it is right. Panic. Panic. Come on, guys. Its like i saw an article about facebook. Facebook ads are lagging. Facebook lagging these are faux dramas. We go through this before every single new launch with apple. Every time. Thank you. We are just getting the beginning. Im sure there will be more data points that people site. It is written several times. Its not panic. I will give you where they should be panicking, snap. Not apple. Come on. This is a company that is sitting there laughing at that article. They have no sense of panic. They want to get the product right. Thats what they do. They are a Consumer Product company that is the best in the world. I want to get a visit of the new headquarters. You would love it. Do we know anybody who has seen it firsthand . They are getting closer. To me when i saw it i thought it was the eighth wonder of the world. Im stuck in that business silo. I have seen the pyramids. How are they . Nasty. Thats a bad trip. Some guy shook me down for a lot of money to take it so i would hold my hand up. Another guy said you have to pay me too. The whole thing was a bad experience. They should be panicking at below 16. I told david i felt bad for these billionaires who have all the votes in the north korean stock structure. Today we had commentary literally people saying its going to get oversold after the 711 million shares come off of lockup. Maybe wait for the 700 million shares to come off lockup. That could be a prime opportunity. We saw twitter suffer that same fate. New cfo. Just like gary cohn. Stock moving up a lot on a lot of different chatter. You are stuck with the facts. It always bores me that shoot down things that are untrue. If you play the game it can get to 20. I let other people play that game. Twitter might see 19. He is from goldman. Better stock. When we come back as we said snap is trying to bounce back after falling below the ipo price. What can the Company Learn nasdaq up three days in a row at ree highest levels of july. Mo squawk on the street from post nine in a minute. If you could book a flight, then add a hotel, or car, or activity in one place and save, where would you go . Expedia gives you the world in your hand, so you can see more of it. Expedia. The future isnt silver suits anits right now. S, think about it. We can push buttons and make cars appear out of thin air. Find love anywhere. Hes cute. And buy things from, well, everywhere. How . Because our phones have evolved. So isnt it time our networks did too . Introducing americas largest, most reliable 4g lte combined with the most wifi hotspots. Its a new kind of network. Xfinity mobile. Shares of snap trying to bounce back this morning after falling. Blue apron around 7 well below ipo price. We looked back at how long it took facebook to recover. 14 months. They had something the other companies dont have, though. Fundamentals. I love our executive producer. I think he knows that the phillies have had three great days and won and two days they didnt play. That would be what we need for the other. That is the formula. They feel like the phillies to me. They dont feel like say houston. Im not kidding. The reason why facebook pivoted to mobile was a brilliant move. Snap has to pivot to something. I asked you yesterday what are they going to pivot to. We dont really know. I dont know, either. Yeah. Rice crispies . The note you guys covered yesterday, right massive competition from insta. You have a product that doesnt give measurement the way some ad buyers want. I used to write obituaries and had a lot of common things. It was just a devastating piece. To me that read like sell, sell, sell especially ahead of the we have to see what they need to do. I will give them a little lesson because we are pals. You can tell. I will snap to them. They have to say we are not we have canvassed all 700 million shares and no one is selling. There is going to be insider buying. They have to do the optics. They have these great short form videos and unveil them. You tell us that these people so and so that espn is advertising. Give me proctor gamble. All 700 million shares will not be sold. Thats how they do it. They have that structure. Would you rather buy snap or apron . If the gun at my head i say take the gun away from my head. That is not an answer. Didnt amazon give away blue aprons the last 15 minutes of prime . I saw 2 price target. It reminds me of like zynga. So too early. Blue apron is down how much . Five other guys trying to deliver to me. The portions are small is what someone told me yesterday. Speaking of amazon a few hours removed from the end of prime dame. The company says they are on track for the biggest sales day in history. We will get metrics. They will be happy to tell us how enormous it was. They sold the little guy. You think they will tell how many prime members there are it is amazon. They dont have to tell us anything. Its like china town. No answers. Dont have to. What does amazon do . Goes higher. He starts off by saying we have been wrong about the stock. Thats the kind of guy. Thats terrific. Those guys have had a hold on. It was time. Never too late. My dog you have been on fire with the dog photos this morning. How about chevron hoping for 10 30 inventories. Are nvidia says going to 200. I will give him ligaments. Dogs really like that. Doesnt smell great. He deserves it. He is going to 200. Artificial intelligence. People dont realize. The Engineering School commencement speech about Artificial Intelligence. We really will not be doing our job according to the speaker. It is just machines. Machines. We count down to the opening bell. More squawk on the street continues in a moment. Perhaps new theme song for gary cohn. We had him show up at one of our events for spring fling. We always got the third tier. I got stevie wonder. Really . Unbelievable. Pay pal. They said visa could kill it. No. They said mastercard can kill it. They said wells would kill it. They said jp morgan would kill it and google would kill it. All of those are partners with apple being the latest. The master of the deal. That is someone else. He is fantastic. He is the ceo. Now it is on apple and it is like you know apples apple pay. Pay pal turned out to be switzerland. Its neutral and it is brilliant and going higher. Going higher even from here. Many analysts were bears on it. A lot capitulated here and here. They didnt understand it because they didnt have kids. Venmo, pay pal. My kids dont know what mastercard and visa. American express, they leave home without the constant. A lot of people are venmow now. It is incredible. I said it was fine. Not something to worry about. I have to do all of dans pr work because he refuses to do any himself. I am telling you he is an unsung hero of this business which is payments process. I hear music which may mean we have to go. I would like to say we are going to sell bonds until quarter to 3 00. And we will have a lot more g t is moving this morning when weethe opening bell a few minutes from now. Your brain is an amazing thing. But as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. Thankfully, the breakthrough in prevagen helps your brain and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. Youre watching cnbcs squawk on the street live from the Financial Capital in the world. The opening bell in about one minute on this yellen day on the hill in front of the house. In front of the senate tomorrow. Repeated the view that some of the weakness in inflation is due to a few unusual reductions in certain categories of price in things like we can assume wireless services. These are actually permanent secular changes. We have tremendous competition. We have a lot of cord cutting. By the way, there is a tremendous decline in a lot of utility bills. But what i think people are missing is the shift economy that people who cannot take full time jobs anymore and dont make a lot of money. Lets understand the rate structure the country has changed. Opening bell on the s p at the bottom of your screen. Safety, income and growth focus on acquiring, managing and capitalizing. It is Diagnostics Company precipio doing the honors. Ten year back to just below 2. 31. Thats how close we are in the cards. Caterpillar supposed to be hitting a new high. Always been the opposite. Caterpillar is worth pointing out. Business is good. The paradigm of caterpillar going down when Interest Rates are going down is not happening. A lot of paradigms being broken. A lot of relationships being broken. Although your financials which of course you have been saying at the beginning of the broadcast you want to become the leaders because you feel like that would be a very healthy thing if i can paraphrase. You need bank of america. I dont want to overstate it. They are down a little bit. Bank of america has had incredible krebcredible asset b, tremendous. If you can get short term rates to go up, that would be the stock to break out. Not goldman or citi which had obviously really good. Jp morgan just say blah r, blah blah. Jp morgan in the red. Amazon reclaiming 1,000 for the first time this month. That was a given i think today may be a day when the analyst, i saw someone say come out and dont forget j. C. Penney. How high it can go and maybe its not just cheering. 40 goes to 53 cents. I question whether you want to buy j. C. Penney here. I know people will say it is time to start looking at the left for dead retailers now that this incredible extravaganza walmart is certainly far from being left for dead. Let me say that. It is up this morning. Do you buy that, as well yes. You do . Yes. Walmart is fine. There is nothing wrong with walmart. I think they will have a good quarter. I think that all of this price competition in food walmart is still a leader. I think betting against walmart when they just begun the process is a mistake. I wouldnt bet against walmart and wouldnt bet against netflix. Netflix being powered by the michael pacter. He has been so wrong for so long. He has been wrong since 2014. When the stock was lower. Now he has been very wrong. A man of his convictions for a long time. Using wrong analysis, discounted cash flow. He is not a house of cards fan. Citing three series cancelled. Thats not how you judge this stock. The stock is not judged like that for heavens sake. Ubs suggesting healthy subgrowth in q 2. They are describing it as very strong q 2 momentum. He didnt get that. He put out a sale at 63. 49. Its now 157. It is amazing what this company spends on content. I think it is 6 billion in amortized spending. Just to put in perspective, fox and cbs around 4 billion. Hbo is about 2. 5 billion. Amazon is number two. They will spend at least 5 billion. Speaking of amazon, they are giving us their press release on prime and it looks like they are saying the event grew by more than 60 compared to the same 30 hours last year although i believe last year was 24 hours. They added another six. And they are comparing 30 over those 30. And the most popular purchase was the echo dot. You couldnt go on there without seeing that every minute. That and that coleman stove. Coleman stove is an old brand. Amazon should go higher. That is revelatory. Probably sell on the news at a certain point not unlike singles day which was short term peak for alibaba. And then there are all sorts of weird things that sold the most. Statisticians put baseball statisticians to shame. Coming from countries all around the world. China, india, canada. Prime members purchased seven times more amazon echo devices. I have to admit it is substantially better than expected. Not just better than expected. It is substantially. Prime members purchase seven times more globally than prime day 2016. That is not unimportant because that install base that they will be able to achieve through the echo and the constant data that it is taking in as it listens to everything going on. Artificial intelligence there. Only helps power it and improve it over time. The more you get out of there the better it is going to be in terms of responding. There is that question what does your echo really know. That brings to mine the upgrade that we got earlier. They take their target to 177. They go to a buy. I love the line, acknowledging we are not early. That is better than just acknowledging you are wrong. The Artificial Intelligence component, just keep that note. People have to understand you dont need people which therefore it is cheaper and they can predict much better than we can. They are better. They dont make a lot of mistakes. We have nvidia behind. If you go it is not code writing. It is a particular software that they have. He has really used chips to a great advantage. That stock goes higher. Caterpillar breaking out. What