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tv   Closing Bell  CNBC  July 9, 2013 3:00pm-4:01pm EDT

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>> hungry hannah? >> casey concase so. >> that's cheesy. >> atta-dog alex. >> don't crash. >> do you have qualifications -- do you have driver's licenses? >> yeah. >> they'll be asked to complete any number of challenges. you have to tune in and join the website. thanks a lot for joining us. you know, we've had a lot of lead-ins on this show, but that was one of them, wasn't it? >> you are going to sing the song? >> no, i will not. we were singing the jingle a moment ago. we'll let you do that at home. welcome to "closing bell." things are grinding higher again as we enter the final hour of trading today. >> i'm in for maria. she'll be back tomorrow. the dow is up 75 points, within striking distance of its all-time high set in late may.
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15,542 is the intraday high. 409, the closing high. so we've had the little box counting down the number of points we are within that range. but right now, about 100 shy. >> fourth consecutive up day for the dow. and the best four-day gain the dow has seen since the beginning of the year. when we launched this whole madness for 2013. so this is a strong rally any way you look at it. >> a couple of traders down here saying it sounds eerily familiar to back what happened -- remember may 21st? that's where we set the highs for the s&p, and what happened the next day. ben bernanke. who do we hear from tomorrow? the federal reserve. >> oh, boy. deja vu all over again. meanwhile, reaction still pouring in about eliot spitzer's attempted comeback in politics. wall street and the banks are not happy, but you know who we haven't heard from yet, the person that spitt erspitzer wil running against for comptroller, but you will be hearing from scott stringer here. he'll be here with us, and we'll
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get his reaction to having running against spitzer and the circus that goes with that, no doubt. >> and do you live in the top state to do business in? we will find out during this program. cnbc's top annual states to do business in has been revealed. so far, virginia, utah, nebraska february, north dakota at number two. >> that was my choice. i was wrong. >> a lot of people thought it would be texas, and it was, in fact, we learned from scott, texas takes the number-two slot. they were number one last year. the new number-one winner will be revealed by our own scott cohn. >> you were telling me you thought -- >> okay. i've had a couple of different -- >> give me the first choice first. >> the first was carolinas, then florida, now i've moved to missouri. where are you now after having seen them all? >> it's somewhere in the midwest. it just looks -- i may be one -- >> ohio? >> maybe it will be north carolina. maybe it will be north carolina. i'll see. >> don't have to wait too long. >> i can base it on the scenery
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behind scott. here's where we stand. the dow was up 90 points at the peak. we're up 77 now at 15,301. the nasdaq, which was the lagger yesterday, the technology stocks didn't do so well, today they're back, up 20 points on the composite at 3,505. and the s&p 500 index is up 11-plus points right now at 1,652. so we're an hour away from the close. stocks are rallying for a four-day win streak. joining us to talk about this and if the momentum will continue, is anastasia, james lowell, brett white, and our own rick santelli. welcome to all of you. anastasia, we'll start with you. you're here with us. what do you make of the rally we've had here? we only had a 5% pullback in this market. was that enough? do we just go higher from here? >> i think we could, because you know what, it's not a rally out of nothing. because we do actually have data
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that certainly supports that. so today seemed like a quiet day. we did get something very interesting and very important, which is a foreclosures are actually as low as they have been, going back to 2008. so because of that, the housing market is improving. so that's a positive going into the statement tomorrow. >> james, it's interesting to see this momentum ahead of an earnings season where the negative preannouncement ratio has been almost, what is this, 12, 13-year high? >> it has. one of the things we clearly look at are valuations. we still see room to grow, especially in the balance sheet, the mega-cap stocks in the u.s. the global market remains mixed. we are leery of the emerging markets going forward, but looking to find the rubys in the rubble in the established markets of europe. >> brett, what are you looking for this this market? and what about tomorrow when ben bernanke speaks, to kelly's point? every time it seems the fed
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chairman has something to say publicly, the markets head south on us. >> no doubt. you've seen a great rally from the latest bout of taperitis from the market. what's interesting is tomorrow we get the minutes. that has not fared well. the last three minutes, the markets have dropped more than 2% for the next week. we think that might happen. the market is now back near all-time highs. it might be poised for another possible pullback. if you get it, i think you need to buy -- buy the dips and then buy the buybacks. that's been the real key this year. companies that have announced buybacks have been double-digit gainers on top of the market. >> and rick has been talking to charles beaderman over at trim tabs. he had that view earlier. i imagine the 10-year will be one to watch, because every time the fed's been out there, it has told us what will happen with equities. >> absolutely. and i tell you what, i like the run-in to the show, because as we sit at 113, 114 points away from all-time new high close for the dow, where were interest rates on the 28th of may?
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>> right, right. >> look at the five and ten year, the left side will show you. look how much rates moved up, and we're still 115 away. we're at 2.17 on a 10. we're at 1.02 on a 5. what's amazing is both those maturities have moved 46 basis points. five year's only supposed to move about two-thirds, 60% of that. it moved the whole thing, which is why people like pimco are so enamored with the bounce in fives. the point of this is, is that it's been afraid of. with all of the talk, they should embrace the fact that equities can survive the 46-basis point run. maybe there's one reason he doesn't like to talk about much -- the duration of the entire u.s. portfolio is close to that five-year maturity, which underperformed, or overperformed, depending on your point of view. so the cost to service the debt is moving higher. many believe that is one of the pillars of these programs. >> yeah, and let's talk about that, anastasia. can the stock market -- will there be a point at which yields
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on the treasury curve will start to provide too much competition for stocks and we start to see it crimp their style? >> there could be a point, but i don't think we're quite there yet. i think the reality is, as investors we do need to be prepared for higher rates. that period has arrived. it is upon us. so the question is, will the data cooperate? both from the fmoc standpoint, but also have the investors' standpoint. to see if the data will cooperate, we'll look to earnings. and we think rates can move up, but because leverage is so low and because companies are allocating a much smaller portion of their operating earnings towards interest expense, those are the reasons why as long as top-line growth is there, earnings can be okay. >> although that's a big if, and the top-line growth will be the focus now, because people will start to say we've seen the earnings boost, we've seen, james, to your point, the impact of buyback, but it will be revenue growth, and that's where we've fallen shy the last qua
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quarter, and already it looks like this quarter as well. >> no question the compression on earnings growth, and we'll be focused on the topline sales versus bottom-line cost cutting to drive the profitability going forward. we remain optimistic about the u.s. companies, especially the larger cap, midcap space, being able to do just that. across the pond, and certainly in the emerging markets, we've got a no-growth to slowing-growth story that continues to play itself out. we think disproportionately negatively to the u.s. plays. >> okay. for the three money managers, very quickly, the best investment idea for the second half of the year. brett, let's start with you. >> stay domestic and stay consumer-focused. we think healthcare and consumer discretionary and those buybacks. >> all right. stay defensive there. jim lowell? >> completely agree on healthcare. it's our single biggest overweight. vanguard healthcare. hartford global, fidelity healthcare, clearly an area where you'll get, i hope, better returns in the mart with significantly less risk. >> okay.
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anastasia, your best investment idea for the rest of the year. >> i think domestically fuelled cyclical sectors is what we still like, whether it's financials or consumer discretionaries. if you look at whether the earnings growth will come from, those are the two sectors. >> so defensive is still the play right now? >> i'm not sure i would call consumer discretionary and financials defensives. i would call them late-cycle consumer-geared stocks that we prefer over globally oriented manufacturing story. >> do you think healthcare, which we heard from the other guys, is too expensive? >> it's getting there. >> yeah. we've seen that on the debt side, as well, people looking at the bond yields and saying, too expensive. we want to thank you for joining us this afternoon. a couple of interesting themes there. thank you very much. >> thank you, folks. >> the dow and s&p 500 creeping higher. josh, how much further do we have to go? >> reporter: kelly, every day in the green here bringing us closer to new records. the dow is up for a fourth-straight day.
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now roughly just 100 points, or less than 1%, from the record close for the blue chips on may 28th. remember, that was 15,409. the s&p on pace to close up for a fourth-straight day. it hasn't done that since mid-may. also, around just 1% from its record hit on may 21st. in the s&p, some movers that hit record highs in today's session include united technologies, 3m, and danaher, around the high end of its range. kroger touching a record high, s agreeing to buy harris. and new 52-week highs include cisco. back to you. >> about 50 minutes to go before the closing bell. we'll keep an eye on the markets. bill, it's interesting we've seen the strong dollar emerge as a theme, as well as multiyear lows for the euro. we've seen bond yields behave in
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this way, correlated to the stronger dollar and the yields, and that will be something to watch tomorrow. >> the three-year note auction today. the yield today was double what it was a month ago. >> right. a month ago. >> unbelievable. a couple of weeks ago on this program, we told you about a new company that's helping individual investors use the same kind off algorhymic tradin. now they'll be here to defend it. and also, another day and another costly delay for obamacare. this time, fines for cigarette smokers are facing a speed bump. and if you think the earlier delay of the employer mandate changed what businesses are doing, meet the ceo of fat burger. he'll explain how his franchises are already using job-sharing to avoid covering their workers. >> ever have a fat burger? >> no. >> i haven't either. emotions are running high as eliot spitzer mounts an improbable political comeback,
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including his own emotions. watch. >> how are you different than you were five, six years ago? what has changed? personally. >> a lot of pain. a lot of pain. >> coming up, spitzer's opponent for new york city comptroller, scott stringer, will tell us if he's buying repentance tour.
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male narrator: the $197 mattress sale... dog: oh, boy! male narrator: on now. ♪ ♪ mattress discounters! the fdic is pushing for stricter requirements today, and kayla just spoke exclusively to one of the regulators key members. >> the top eight u.s. banks must now meet leverage requirements nearly doubling the strictness of the global counterparts. they want u.s. banks to borrow less against their assets, so there's ultimately less risk in our financial system. the criticism? u.s. banks will lose their competitive position. but fdic vice chairman thomas honig spoke out to cnbc against those critics. >> when you compete from a position of strength, you are doing -- you compete much more successfully. you can handle unexpected surprises in the market. you can handle losses that you might not have overwise
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otherwise be prepared for. if you find by not having a strong capital position, when you have a downturn, as we did here in 2007 and '08, you have an implosion of loans. so you really actually do your economy and your borrowers a great deal of harm. >> reporter: what will banks do with all of the capital? he says they can still invest it, but they can't lever it up to produce artificial high returns. he said 12%, 15% return on equities for banks should be just fine. more capital, he says, will start to cancel out any financial subsidy. he says banks get for being big, he estimated that some studies say that could be as much as $85 billion. and if these proposals mean that banks eventually break up, he says the economy would be the better for it. an interesting development, guys, and we have 60 days to hear from the industry on this rule. so certainly a story we'll keep watching. >> we will. kayla, thanks very much. the dow's on track for its first four-day win streak since late april, and the strongest four days, bob pisani, since the
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beginning of the year. it's a real rally here. >> and we are 1% on the s&p 500 from an historic high. 1,569. a lot of unusual outliers. look at this, when you see a 2-percentage point difference between the dow transports and the dow industrials. and the russell 2000 is at an historic high once again today. but put up some of the dow transport stocks. fedex has been moving. vague discussions that ackman may be taking the position in fedex based upon a new fund they may be starting and described some of the parameters around that. we don't have any confirmation about that. you can see the other ones like matson, one of the big ocean freight carriers, csx, airlines are up. amr is also on the upside, as well. so a broad swath. not just fedex, but a broad swath of the transports on the upside. and the other is the homebuilders. the only real news, core logic
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said dlink we delinquencies are at the lowest since 2008. nobody has given me any ideas on this. finally, the banks, i am waiting, a tough and interesting quarter for earnings. generally, they're the bright spot, the financials. jpmorgan, wells fargo reporting on friday. the good news is overall, the yield curve, will help the banks. i think mortgage refis will be down, rather noticeably. but that's the later part of the quarter. i'm not sure how much of an impact it will have. the one thing i want to find out is the bond exposures. some of the bonds in the active trading account portion of the companies have to be mark to market, and that may influence some of the earnings a little bit. >> right. bob, thanks. stay right there, actually. >> yes, don't go anywhere. >> another discussion we want to have. automated trading and supercomputers have long been the refuge of wall street's elite, but now the kind of algorithmic-based trading is available to the masses. >> we told you recently about a firm call allowing fast trading
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the and most felt it wouldn't be a good idea. but our next guest happens to disagree. he happens to be the ceo of the company. also with us to beat up on chris, patricia powell, and bob is with us, kelly is here. everybody, i mean, i will say, my brother-in-law would love this. he's a day trader. and he would love to participate with something like this. is the risk factor too much for the average investor? do they not know what they're getting themselves into? >> i don't believe so. algorithmic trading by definition is not (unintelligible) trading or anything else. it's just a set of rules. that's what the algorithm is set up to do. it's a recipe. what do i want to buy and when do i want to buy it? this is something you can trade once every six years or every six minutes. and it's really open to anybody. >> i would imagine more of the people using it, though, will fall into the every six seconds as opposed to the six years' camp? >> actually, more -- the most
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frequent traders we see are trading 40 times a day. so it's once almost every ten minutes. that's the most frequent. most are trading on a daily basis, so that means the actual strategy might kick in once every two weeks or something. >> have you figured out a profile of the average person using the algorithms? >> honestly, i have to say, bill, we did invent something, it's revolutionary, wall street 2.0, wall street trading, and in that regard, we're offering this to anyone who has a program, and it's a wide demographic. the beta users, before we launched, ranged from hedge funds for someone learning to trade for the first time and found our software and felt it was a great tool to find out what the technical indicators are. >> patricia, if this is, like, a sale order before it moves below the moving average, what's wrong with that? >> i doubt very much that will be your typical retail investor when they use these algorithms. you know, in all honesty, this might be fine for some 21-year-old student sitting in his dorm room at m.i.t. who can
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write good algorithms and come up with something new. for the typical investor, i like the analogy back to day trading. in the '90s, 90% of them lost money. think of it this way. you have your license to drive and now you want to go on the indy 500 track with the big boys, and you are going to crash and burn. it's real money these people are going to lose, not fake money. >> but, i mean, that's their problem. that's their issue. if they want to lose the money, they lose the money, right? why should we be standing here saying that they shouldn't be doing that, if they choose to. >> i can't say that they can't do it. i can say that they shouldn't do it. losing money is terribly damaging. and i agree with your premise of free markets and free will. but at the end of the day, when people lose money, it affects family. it affects the economy. and, in fact, when the dot-com bubble burst, you saw what happened to the day traders. they lost their retirement money. the families were destitute.
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>> we can make the same argument about gambling, for example. and i agree with her point. generally, i think people should be careful about this. i don't really have a problem with it. i think it's been mischaracterized. you're not a high-frequency trading shop. your point is, if somebody wants to say, i want to program my computer to buy micron, i want the computer to be able to do that, why do i have to sit there and wait for it to cross the 50-day moving average? that's what you want to do. my problem is, and i agree with patricia, is there any evidence that people who do this can make any money? if there isn't, maybe it's not worthwhile. secondly, i don't know if you're that original. doesn't fidelity, have quantitate um programs you can buy off the shelf, right? >> to answer those categorically, we are original in that we made a visual programming language, you can drag and drop. >> yeah, a good point. >> automated pointing isn't around. what we're trying to do is either alleviate the need for quantitative programmer or hiring, frankly, a goldman sachs
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to create a black box for you. you can create anything. patric patricia, to your points, the 21 m.i.t. student, actually, bring it on. i welcome that guy to start bring on the algorithms. >> he's the customer that can get value out of this. >> we sell to hedge funds, the biggest institutions on wall street. >> i'm fine with the big boy. no problem with that. >> also to bob's point, how do you make money in the market? i don't have to tell you, i'm sitting here on the floor. it's buy -- i'm sorry, it's buy points and sell points. we make it easier to pinpoint the optimal buy points and sell points and do it in the scientific way. >> the real concern ultimately people will have it goes back to the oldest time issues, which are the extent to which, you know, someone can and should try to market time, try to use some of the metrics as a way to get in and out of the market instead of identifying value, buy and hold. >> yeah, yes, you're absolutely right. also, an additional tool that will help there is the back
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testing. not only can -- right now, we're using technical indicators for the tools. 2.0 is around the corner. with the back testing tool, you can make a very simple strategy, test it over the past ten years and see how you would perform if you were trading all along. that's something anyone can use, whether you're a private wealth manager, on the sales side, trading desk, here, or, of course, a stay-at-home trader. >> do you understand the concerns that people like patricia will have, that there will be people that will buy the app that should have -- that have no business trading the way -- as easily as you're making it for them to trade? >> i might be too optimistic. i'm an entrepreneur. i believe in the markets. i'm a capitalist. there's not a bone in my body that believes we should limit people's potential to use technology, just because we think it's in the safety or the best interests. they can choose it themselves. >> well said. good job, chris. thank you for your insights, patricia. bob, thank you, buddy. keeping an eye on the dow.
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up 86 points now. i wonder if there are algorithms behind that one, bob. >> i'm bill. he's bob. >> i'm going to leave now. >> that's kelly. she thinks it's florida, or is it north carolina? >> i can't even -- >> i forget the number-one state. we are inching closer to new all-time highs. keep an eye on that. and also coming up, money manager david zeer will explain why he thinks stocks are cheap on a historical basis. and blackberry shares rallying today as they host the shareholder meeting. up next, we'll hear from somebody who says the investors should take some profits because the stock has nowhere to go but down. we're back with more "closing bell" after this. ♪
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>>. >> blackberry shares rallying pretty nicely. despite the sell-off, the company is getting some love from shareholders at its annual meeting. seema, this goes back to when the company started talking about potentially splitting itself up, no? >> absolutely, kelly. the street was definitely anticipating blackberry shareholders to grill ceo hines and voice the concerns around his lack of success, and many shareholders were calm and hopeful. one shareholder asked if blackberry would break its business up, and hines did not dismiss the idea. >> before you go into any strategic option, i think you have to create value, and the value of the company 15 months ago was way less than what it is today. >> blackberry outlined a
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step-by-step transformation plan which includes reducing costs, creating a strong balance sheet, focusing on the enterprise platform, and returning the company to profitability. providing that actionable approach or outline has been well received by the street. heines acknowledged that it hasn't been an easy journey, but urged investors to stay patient, stressing that turnarounds take time. bill? >> yeah, so we hear. seema, thanks very much. shares of blackberry have been higher today amid the shareholder meeting. is this a sign the smartphone maker is turning it around, he said, grasping at straws. let's talk numbers on the technical side is rich ross and larry is doing the fundamental side for us. he's ceo of dinah link, a telecom company. he joins us with perspective. larry, you say blackberry is dead, right? >> yes. blackberry -- i believe blackberry in its current form is dead. it cannot continue.
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it's been -- it's been lapped and all we see here is they've basically come out with a product that's only 5% of the entire smartphone business. so they have $3 billion in cash, and what happens is, right now, the market capitalization is 5 billion. so with 3.5 billion in assets, 5 billion in market capitalization, that's 60% of market cap used, which means they could basically go under, become an asset sale. i don't believe that it will happen. i believe microsoft will come in as a take-under in a 5 to 7 range. >> all right. we'll get back to that. rich, how does the chart look for you? >> i tell you, bill, i could not agree more with larry. in this business, when you have the fundamentals on your side, you pound the fundamentals. when you have the charts on your side, you pound the charts. when you have them both on your side, you bound the table. and that's what i'm doing here as a seller of the stock. you can see this rally that we had at the end of last year. that was hope-fuelled. we went from 6 to 16. i think we go back again. you see the stock settled into a
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trading range between 12.50 and 16.50 on the high end. that's a $4 range. we get a decisive breakdown from that range. we take out the 200-day in the process. in the near term, there's measured downside to 8.50. once again, i think we go into the low single digits, just like larry said. >> larry, what can microsoft do to make this company make money, or do they even need to make money? what would be the strategy to buy a blackberry? >> well, microsoft -- the reason why they would come in, maybe a defensive side, the patent side. and also the enterprise user software which microsoft is doing great in. they're up a lot this year. and it's the enterprise user-based. so if they take the user enterprise base from blackberry and roll it under them, especially we see internationally, 45% of the business right now is in africa, which is emerging markets and growing, they can roll that all under themselves. and, also, possibly through something on the phone side, because they are the third
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ecosystem right now. that would be the only play for them to move forward, i believe. >> bill, keep in mind, 2.9% global market share. that's pathetic. even emerging markets, which is the lone bright spot, they're under attack by samsung and apple, which are both hitting that low end of the market, extremely hard. blackberry, this ship has sailed. you got to be a seller right here. >> as our viewers know, i'm a proud owner of a q-10, and i'm hoping somebody picks up the phone if i have to call them. thank you both for joining us. appreciate it very much. yikes. >> 86 points. there's no need for name calling. you know, pathetic? come on, the company -- >> what do you really think, right? >> 86 points on the dow. a half a percent. similar gains across the s&p and nasdaq today. yesterday, where we saw, bill, a little bit of a lagger, not the case. transports higher but -- >> by the way, we haven't mentioned art cashman is saying it's the buy side, 50 of the top five s&p 500 companies have buy.
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>> okay. >> bias to this point. we'll see if that translates into higher prices at the close. the big question now, is fast-food chain fat burger acting alone? it has found a way to avoid obamacare coverage for employees. the company's ceo will be here to explain in a moment. speaking of food, twinkies are set to make their triumphant return to store shelves next week. is it a triumphant return for the workers? would they have made more money per hour from the final offer? the offer was rejected by the union. are the new bosses paying more? the difference is dramatic, and we'll show you when we return. tdd#: 1-800-345-2550 opportunities are waiting to be found in faraway places. tdd#: 1-800-345-2550 markets on the rise. tdd#: 1-800-345-2550 companies breaking through. tdd#: 1-800-345-2550 endless possibilities.
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it looks like there's another delay for obamacare. john harwood breaking down the latest setback and what it means to the overall cost to the program for taxpayers. hey, john. >> reporter: hey, kelly. it's not often president obama gets accused of favoring big business over the average person, but that's exactly what house speaker john boehner accused him of today as part of his continuing attack on
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obamacare. >> i think what the president did is outrageous. the idea that we're going to give big businesses a break under obamacare, but we're going to punish small businesses and families? it's wrong. and we'll have another vote. count on it. >> reporter: now, what speaker boehner was talking about was one of a series of delays in some key benchmarks for obamacare. first was a delay in the range of options available to employees of small businesses albeit more streamlined set of options now. the second was a delay in the enforcement of the so-called employer mandate. most large businesses already provide health coverage, but they're not going to have to pay a penalty if they don't now while they try to work out communication with businesses. and the third was the delay for one year of some forms of income verification for people applying for subsidies on the so-called exchanges. the reason john boehner asked for the individual mandate to be delayed, like the employer mandate, is because that's the absolute linchpin of the law. that's also the reason why
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president obama and his team cannot agree to delay that. and yesterday i talked to todd park, who is the chief technology officer of the administration. he said those healthcare exchanges where individuals will buy the coverage if they can't get it from their employers will be up and running october 1st. no delay on that, according to the administration. we will see, bill. >> yes, we will see. a lot of questions to be answered. john harwood, thank you very much. see you later. so you haven't heard of fat burger? >> i've heard of them. just haven't had -- >> yeah, they're based on the west coast. when i go to california, i see them. i haven't stopped, i'm sorry. the ceo is joining us. it's a company that already has taken steps to beat the cost of the new healthcare law, and the ceo who will join us says the president's delay of the employer mandate came too late for him. so let's talk about this with the ceo of fatburger. what do you say? >> that's right. joining us now is the fatburger ceo andy. thank you very much for your time. >> thanks for joining us. >> how are you? >> andy, first of all, explain the moves that knowing this
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employer mandate was supposed to go into effect later this year, you've already taken with your businesses. >> first of all, fatburger is a franchise system. and at fatburger corporate, we have 200 employees, and we provide benefits. that's not the message i'm trying to send. it's the franchise operators, the small-business guys, who are afraid to -- as to how this law is being implemented and they're the ones taking steps on their own. i have no control over them. that's why i think this law needs to be improved. what's gone on here is that you have small business, the guy that owns one restaurant or two restaurants, when he goes over the 50 employee limit, when he owns his second restaurant, now what they start to do is job share. they'll split up and stop at 29 hours and have the employee work across the street at someone else's restaurant, and he'll hire that guy. so what needs to happen is these hourly limits need to go away. these should be full-time 40-hour workers to discourage job sharing, because we want all of the employees to have health coverage. the national restaurant association wants it, and so do
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we. >> i feel it's incumbent to point out, a statistic i read, this only impacts 3% of employers in the country. yes, it's not great for the small business owners who are affected by this, but they are only 3%, of the people that create jobs in this country. having said that, what are the franchisees doing to try and deal with the coming obamacare you were talking about? >> right. the problem is the restaurant industry operates on a small margin. it might be 10% to 15%. so saddle them with this additional cost means the independent operators that run their own businesses move around and try to figure out how to save those pennies and nickels. and it's really relevant. so when you have a cliff that they fall off of when they have a certain number of employees, or work over a certain number of hours, 30 hour, full-time employee under this law, or have more than 50 employees, now the law steps into effect for small business, you're right that, in fact, it only affects that small percentage of small business, because 98% of large employers provide coverage and 94% of
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those in between provide the coverage. but the small business guy doesn't have that restriction. and it's affecting him. and really we need to modify and improve the law. so i think the delay helps it a little bit. >> i apologize for interrupting. my question is, what are your fatburger franchisees doing to try and mitigate the impact this is going to have or try to avoid it all together? >> right. so what it is, it's the job-sharing aspect of it, where they're cutting the hours or cutting jobs. they're trying to avoid tipping that scale and going over that limit. >> andy, now that the employer mandate has been pushed back a year, do you expect the franchisees, and i'm sure you've talked to a couple of them, do you expect them to go back to the old way of doing things? or will they stick with this, do you think? >> i think there's a whiplash effect. it's, like, what will be changed next and how will that affect them? it's important the government give clear direction as they try to improve the law during this year, that they have time. and really, you don't want to see employers sharing employees, because that is limiting the amount of wages they can earn for the number of hours they can work. really, we'll communicate with
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our franchise partners to try to avoid any job sharing and try to make sure they're focused on the benefit packages that are available under the system and under the exchanges. >> all right. good to see you. thanks for joining us today. >> thank you. there's a fatburger in new york for you, too, bill. >> where? >> on third avenue. >> on third. >> third and 34th. >> all right. have the car stop by on the way home tonight. thanks, andy, very much. >> take care. >> see you later. where were we? i was flustered. i didn't know there was a fatburger in town. 18 minutes left in the trading session. dow up 86 points. we are about 99 points away from the all-time high. we won't do that today. you never know by the end of the week, right? >> and yet the fmoc lurks. also, we're following, of course, states that are best to do business in. and which state will take this year's crown as the top state? here are your runner-ups. runners-up. and after this break, scott cohn will round up all of the clues for you and set up the big reveal which will happen in just
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about an hour. >> i think it's north carolina. what about you? come on. pick one. >> missouri. >> all right. amazing new video emerging now of the crash. you knew this would happen. this is the crash and evacuation of asiana flight 214 on saturday. the latest on the probe into whether south korean culture may have contributed to this deadly crash. we have phil lebeau still on the site there. he'll explain coming up later on the "closing bell." ♪ unh ♪ ♪ hey! ♪ ♪ let's go! ♪ [ male announcer ] you can choose to blend in. ♪ ♪ yeah! yeah! yeah! or you can choose to blend out. ♪ oh, yeah-eah! ♪ the all-new 2014 lexus is. it's your move. the all-new 2014 lexus is. ever all-new 2014 lexus is. ybody has different ideas, goals, appetite for risk. you can't say 'one size fits all'. it doesn't. that's crazy.
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oh, we're almost there, kids. we're countin' them down to the stop state for business in 2013. we'll reveal in about an hour which state gets this year's bragging rights. scott cohn's been telling us the runners-up -- >> see, now we've both done it. >> -- throughout the day, and now only one remains. >> scott cohn joins us to help figure out who the question mark is. scott, we've been trying to figure out from scenes behind you, people, vehicles, license plates, anything. so go ahead. what's the last clue?
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>> does this help at all? i don't know. >> not really. >> bill, you guessed -- you guessed north carolina, bill? >> i did, yes. yes. >> okay. and, kelly, you're going with florida did -- >> i guessed missouri, but it's a low-conviction guess. >> reporter: okay. all right. i won't tell you yet. i will tell you where we've been thus far, as we counted down the top five. we have our first-ever tie in the top five at number 5 with utah and virginia. utah was the runner-up last year and virginia was number three. and it's always been right up there. they both slipped to a tie for fifth. in fourth place, nebraska makes its first appearance in our top five. nebraska's always done well, but does particularly well this year as we put an emphasis on low costs in our study. north dakota, with the big shale oil boom moves in to number 3. it cracked the top five last year at number 5. and it came within a hair's breadth of number 2. the runner-up was texas, which beats north dakota by just a point. texas is still a powerful state
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for business, but does have some cost issues, particularly in terms of utility costs and property taxes. now, let's go through the hints we've given you thus far. we had big mouths. well anchored. scratch beneath the surface. and negative territory. and our final hint, which i'm kind of partial to, the final hint is you don't hurry enough. you don't hurry enough. that's what they always told me when i was a little kid. that's why i'm kind of partial to it. anyway, about an hour from now, we will reveal the top state for business 2013. you will then be able to go to and see the rankings for all 50 states we measure in 10 categories. 55 metrics. we think it's the most comprehensive measure of competitiveness around. we'll have a few other special things planned for you, including an interview with the governor of this top state for business, and you'll finally get to know where i'm at. that's coming up next hour on the "closing bell." guys? >> see, i thought it was going to be north dakota. i really thought with the oil
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and gas boom they've got going on, that would push them up there with the incentives they're providing, but it finished number 3. >> scott, did you say the phrase, you can't hurry enough, was something people told you growing up? >> reporter: that's something they said to me growing up, does that have to do with the hint? i don't know -- >> i hadn't heard that one. all right. we'll see if anyone else -- >> see you next hour. scott, thank you very much. we have just about 12 minutes to go before the closing bell. in fact, we haven't actually seen much movement on the major indexes. in figure, the dow is paring the gains. >> that's the buys that were expected to come in. the dow is only 100 points away from the closing high. both of our next guests explain why they are still bullish on this market right now. also, disgraced former new york governor eliot spitzer is making a political comeback, or at least trying to. he's running for new york city's comptroller job. coming up, his opponent, scott stringer, will react. that's later on the "closing bell." ay's markets, a lot can happen in a second.
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welcome to this episode of "land of the giants." wait'll you see the other two guests. >> i was going to say. >> who picked this out? >> we'll get the soapbox. >> where's my apple crate?
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we have ten minutes left with the dow losing altitude. >> that's right. we're still watching the all-time highs. the big question is whether the momentum we've seen over the last several trading sessions can continue. is this a warning sign? let's ask david and tim from elevation, appropriately enough, llc. guys, are you worried about the sort of lack of momentum into the close today? dave? >> well, we don't focus so much on the short term. i wouldn't know what to do -- >> what a luxury, what a gift. what's your investing horizon, a decade? >> a decade, longer. >> so then what are you watching today? >> in general, we're still finding value in this market. there's lots of places that are still attractive. you look at natural resource equities, those have kind of been left for dead alongside the road. those are trading at 6 to 7 p/es. >> people don't like commodity valuations for the most part. >> true. that's where the opportunity is. >> tim, we've had four consecutive up days for the market. and the best four days since the beginning of this year.
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does this mojo continue, or are you getting ready -- >> no, i think it does. and key derivative fundamentals we focus on, the technicals we focus on, look positive near term. mortgages have held in. mortgage collateral. we think treasury is overdone here. we think they can rally to the two-half level. if you look at where risk is across the board, we are a function of interest rating. u.s. interest rate volatility is absolutely the richest asset across all asset classes across the globe. >> why doesn't that crimp the stock market? >> the global growth iss pickin up, and the u.s. is picking up. and the investors are acting rationally here. if you look at equity risk premiums, 50 basis points on 10 years, yes, on the margin, it is not necessarily great. but it is really not that big of a deal if we're looking at a positive growth scenario. if you look at equity volatility as very cheap here, correlations
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and other metrics have fallen dramatically. the ecb comments on friday were significant. they've put a putback in the market. >> david, how worried are you guys, or do you have the luxury of looking past the federal reserve when we look at tomorrow and what we've heard from bernanke so far this year? >> this tends to be a softer period of the market in the next several months. i think we'll see more volatility, both up and down. but, you know, the bias to the market is still upward. we think the market will still most a nice return for the year, and the short term doesn't matter as much. it provides opportunities to -- >> what do you think will take us there, the cyclical side, the defensive side? >> we tend to buy baskets of stocks, so we don't focus on individual sectors. the materials, natural resources area is attractive. and if you go outside the u.s., looking at emerging markets, those have been beaten up pretty bad, and those are pretty nice and attractive. >> a daring bet. >> thank you, guys. >> appreciate it. thank you. up next, we're coming right back with the closing countdown.
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>> and get ready to find out this year's top state for business in 2013. we've been talking about this all day. scott cohn has the big reveal and an interview with the mystery state's governor coming up next hour of the "closing bell." you're watching cnbc, we are first in business worldwide. n ty all your important legal matters in just minutes. protect your family... and launch your dreams. at we put the law on your side. after age 40, we can start losing muscle... 8% every 10 years. wow! whoa! but you can help fight muscle loss with exercise and ensure muscle health. i've got revigor. what's revigor? it's the amino acid metabolite hmb. along with protein, ensure helps rebuild muscle and strength naturally lost over time. [ female announcer ] ensure muscle health has revigor and protein to help protect, preserve, and promote muscle health. keeps you from getting soft. [ major nutrition ] ensure. nutrition in charge!
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that. they matched it. so we're off the highs of the day for certain. but still, the strongest four-day gain for the market since the beginning of the year, terry dolan. is your pullback you'd waited for, is that over for? are you ready to go long, this market? >> well, no, i think that as we discussed, we're looking at a market that now is in a trading range. i think we tested some of the low -- the mid-points, the low end of the range, around 14-9, and now at the top end. i don't think there's any reason to start to run in and start to think the market will break out above its prior highs right now. a nice numbers-driven rally for the last four days, starting with the jobs numbers on friday. tomorrow, don't forget, we'll look at what the fed is thinking, and that has never really gone too well in the last three, four meetings. >> we've been discussing that. >> and as you've been discussing that, then we feel as that it might be a headwind coming into this marketplace. again, we're 100 points away from the top. we've kind of vacillated in this trading range. and again, we want to be buying the dips and we want to be
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selling -- maybe selling some of strength to buy them back again. >> all right. very good. thank you, terry. [ bell sounds ] that'll do it for the end of the first hour of the "closing bell." midwestern farmer, farmer mack, ringing the bell and commemorating the anniversary. and getting ready for hour number two as we find out what the best state in america is for business. knocking on the door of a new closing high for the dow. welcome to the "closing bell." i'm kelly evans. maria bartiromo is back tomorrow. >> and i'm bill griffeth. the dow rallying for the fourth-straight day. we were up about 90 points thereabouts at the high of the session, but came in from that on the close. a gain of about 75 points, right at 15,300. the all-time high was 15,409. so we're about 110 points away from that now. the s&p up 11-plus points


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