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tv   Markets Now  FOX Business  July 18, 2013 11:00am-1:01pm EDT

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losing its place as world leaders to china. perve -- perspective on that. the best ever quarter, the ceo here in the hour to talk about that. that interview in 20 minutes or so. talk about baking. nearly 130 million people in the midwest and on the east coast who are just dealing with the scorching and a dangerous heat wave, so all of that and dagen on this hour of "markets now". dagen: we will not talk about the blurred lines video this hour. connell: perhaps we can get into the blurred lines, whatever ben bernanke has to say to congress today. that could be the different take on it in this hour. dagen: exactly. triple digit gain on the dow now. all-time high, annie coal, what are you looking at specifically,
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nicole? >> they are the first headline story is 15588. the dow jones hit an intra-day all-time record high, obviously, had a tough go after ben bernanke eluded to tapering back on the may 22, the markets dropped a thousand points, down to 145 only to come back now, in a few weeks, so, so far, so good. health care is doing well. united health care is a big leader on the dow jones, and energy, names like exxon and chevron, financials doing well. again, stanley had their numbers, but you are seeing gains across the board. jobless claims better than expected, and the fed number helped things along. dagen: thank you so much. a group of bipartisan senators struck a deal to restore lower interest rates for students after rates on staff ford loans doubled from 3.4% to 6.8% at the start of the month on july the 1st. the new deal offers lower rates
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through 20 # 15 or the academic year for 2015, and then would tie the interest rate level while democrats want to cap the rates. steve moore is the senior economics writer at the "wall street journal" joining us now from washington, d.c.. steve, how does this deal in the senate differ from the one that the white house already passed? i mean, both looking to at least lower rates for student borrowers. >> well, mainly, it's by tieing the rate to the federal funds rate, dagen, and i have to say i look at the deal, and everybody's talking about, you know, giving -- reducing the interest rates for student loans to help students. the real people who benefit the most from this are the units themselves, and we have a number of analysis at the "wall street journal" showing clearly every time we provide lower interest rate loans for student loans, the -- what happens is the cost of tuition rises like a dog
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chasing its tail. one other thing, you know, that really kind of pissed me off on the news this morning is the congressional budget office is going to say this is going to reduce the digit deficit by a billion dollars over temperature years. now, how does that work? we're providing subsidized loans, and by these weird accounting rules used in wash, this is to lower the deficit. dagen: i know. some of the ideas coming -- there's so many things wrong with -- because, again, when you read the headlines about the stafford loan rates doubling, everybody gets up in arms about it, and i'm like, okay, well, then you're willing as the american taxpayer to continue to subsidize the rates. i want to know long run -- >> interrupting on that point. that is such a critical point. you know, if you provide a subsidized student loan, that's fine. if we, as a society, want to do that, but let's not pretend this is a free lunch. this is not a free lunch.
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somebody picks it up. that will be just who you mentioned, the american taxpayers on the hook here. by the way, if you look at outstanding student loan debt, a great scandal in america, you know the stats, a trillion dollars of student loan debt. who do you think is on the hook? >> where do you draw the line? looking back at how much the rate on the loans went up, it did -- it was at a level because it went up to 6.8%, and comparedded to the ten-year treasury, that's ridiculous amount for the federal government to be charging people. how do you fix the long run? the democrats' idea in the senate is to eventually, after 2015, cap the rates at a certain level, 8-- eight and a quarter percent cap, but that doesn't -- but then what if rates are higher than that? you have a taxpayers eating it. well, we've known each other a long time. you know the answer. allow the markets, not congress,
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to determine what the interest rate will be on these student loans. now, if we provide a subsidy, we should be very straightforward to the american taxpayer about what that subsidy is. setting a cap on the interest rates, i think, is absurd because as you said, we don't know what vest interest rates look like from two or five years from now, and i believe that these rates should be risk adjusted, and they should be based on what the markets decide, not what congress decides. dagen: people complain about college, and it's exactly like housing. you have plentiful cheap credit available to students, and all that happens is college is charged more, that's it. >> you know, i have a sign -- i'm not going to mention the university or i'll be kicked out, but i'm paid $62,000 a year, you know, for the tuition right now, and it's unfair for people paying the whole freight to then have to be paying, you know, the student loans for people who are not paying the
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tuition costs. dagen: i feel for you, i do. >> you feel my pain; right? dagen: i do. wake forest was cheap when i went there. thankful for that. >> not like today. dagen: no, it is not. thank you so much. connell: chinese are better than us or soon they will be. that's what new polling shows out of 39 countries they surveyed, 23 of them say china has either replaced or will replace the united states as the top world leader. with us now from mountain view, california, the chief investment officer at merck investments. what do we take from this, if anything, that, hey, china passed us or are going to? >> well, you can think of the pr issue or we think of it as a money issue. if we have a world power, what's clear is it's expensive. if we had a military cop flick with china because we have to defend taiwan because of treaty
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obligations, we borrow money from china to fight the chinese. that cannot work. it's not a successful strategy, and so if we want to be a world power, we have to live within our means. we talked about student loans, spending money generously, it comes back to haunt us. connell: how absurd that is because our relationship with china, although it's the most important bilath rail relationship we have, and it has not been going great, but if there was a conflict, hey, give us a few buck, and let's fight. you're the banker. the other thing that i thought jumped out about the survey, other than just the headline figures, are what they are, is in our relationship to the chinese, nonislammic country where more than half the residents have an unfavorable opinion of america of china, 54%. they don't like us that much either. >> well, obviously, these are
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perceptions, they are opinions that can change. i think the chinese are currently more focused on japan. read the headlines coming out overnight. they said that the japanese are pursuing dangerous policies. glad they are speaking up. obviously, what the japanese are doing is destroying the currency, trying to dump everything on the rest of the world causing political instability, and, ultimately, again, pulling us back to the money item, the one consistent dream throughout the world with the printing going on is we destroy the social fabric, creating political instability, forcing them to rise up pop pew lism, and the chinese, are, of course, have a billion-plus people to manage, and they see these threats, the monetary threats originating from the u.s. so it goes forward beyond military power. to have peace, you need social stability and start with sound monetary policy and fiscal stainability everywhere.
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>> finding out how the people years ago felt. thank you very much for coming on. >> my pleasure. dagen: thanks for that uplifting analysis. connell: on the way down. dagen: we're britain. connell: that's what the survey shows. who knows. dagen: chief ben bernanke back in the hot seat for second round of questioning today before a senate panel. connell: here's a sign of the end of the dominance here, the fact we have to have the latest development, and the man on the job is peter barnes in washington. by the way, live to ben bernanke if anything is heated, but in the meantime, what's been going on, peter? >> happy to do it, guys. you know, i'm in clover when this stuff is happening on the fed, and we have ben bernanke back, and he is -- he's having the same opening statements, just finished giving that, but the hearing is starting off with a little, i think, a little bit of an edge. the chairman of the committee, democrat, said that in his
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opening statement, quote, the feds prematurely should not step on the brakes. johnson, a democrat. the republican ranking member of idaho said he wants to see a road map for how the fed unwinds the huge 3.5 trillion balance sheet, a trillion here and there, you lose track, 3.5 trillion balance sheet, when it stops, tapering that. he's looking for a road map toz. >> some of the increase in prices of equities and others recently is attributable to the fed balance's sheet expansion and not fundamentals. in fact, june marked the worst month on record for bond fund outflows. reactions indicate that markets are heavily reliant on government intervention. >> question is are the lectures
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working to settle them down about the prospects for tapering and ending qe? well, the research thinks so. the markets' reaction to ben bernanke's can you hear me now testimony suggests, yes, now we can, since interest rates came down and mortgage rates backing down a limit as well. connell: keep us up to date, peter, on the whole thing, up a hundred on the dow. everybody likes it for today. peter barnes and ben bernanke in washington. dagen: the railroad that literally touches almost every part of the economy reporting its best ever quarterly results. the ceo, is here. connell: that'll be good. dell delaying the vote to be private. new developments on that story ahead. dagen: scorching temperature the in the east coast and impact on businesses and you as we're
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going to get relief in a few days, maybe. look at the oil markets. we don't need to heat our homes, but you still have oil up, really, following the market today, better economy, higher crude pricings, almost 108 bucks a barrel. ♪ (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time.
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dagen: not a record, but it's close. triple digit gains for the dow. looking at ddll and what happens with the potential sale of the company. >> right. it's obviously a key day for dell and shareholders because today is the day they were due to vote on michael dell's offer to take over the company and move it private for 24.4 billion dollar buyout by its founder, and then what happened, the meeting started as 8:12 a.m. central time and quickly adjournedded thereafter because they didn't -- they were unsure whether they had the votes to
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pass it and move it forward. of course, carl ikahn, seconds largest shareholder is vocal trying to take the company as well, and so they adjourned quickly. they didn't have the turnout they hoped, and that counts as a no-vote. back to you. connell: thank you, nicole. charles payne is here to make money. dagen: technology stocks hitting new highs. >> it is. this is interesting because people have to make a decision. if you want to be a part of it, stocks you buy will be at 52 week highs. when i look at the stock, i have a one year chart, and people do that. pull up five year charts and ten year charts to get a sense of where stocks can go because a great number, strong guidance, making a financial breakout, and 43.50, resistance point, closing here is big time. i went back to january 2002 to get that number.
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con cop here we go. look at another, the five-year chart. you get a sign-in there that this is 5 good buy because? >> well, what happens is people -- a lot of people watching the market feel they missed it and reluctant to buy at a new high. understand that you have to go beyond the one-year chart. if you use the five year chart, you see where some of the stocks have been substantially higher, and that takes away anxiety that maybe i'm chasing because people are missing the market because they feel like, oh, i don't want to chase, i'll wait. you wait and wait and you wait. connell: it is a lot. >> oh, yeah, huge move. the number phenomenal. that's a one-two punch. fundamentals change, much better, and huge technical breakout. dagen: charles, thanks. >> you got it. dagen: you doing the -- >> yeah, hosting "cavuto" tonight. connell: 8 p.m. with charles payne. talking with the ceo, best
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quarterly results ever. stay tuned for that. dagen: want time off from purgatory? you got to follow the pope on twitter. connell: let's do it. dagen: you can weigh in. you're more of the authority on the catholic church than i am. connell: because i'm catholic? dagen: yeah. get me out of this. world currencies, how they are doing against the dollar. ♪ ♪ the most free research reports, customizable charts, powerful screening tools and guaranteed 1-second trades.
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>> this is your fox news minute. president obama set to defend the law in the white house speech expected to challenge geep efforts to repeal the law pointing to a half a billion dollars to be paid by insurance companies directly to 8.5 million americans this summer. we're waiting for the press conference. today is man delta's 95th birthday, and while the
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president has been hospitalized since june with a lung influx, authorities report the condition is, quote, steadily improving. today is mandela day. supporters asked to volunteer 67 minutes to hop nor his 67 years of public service. an offer for the twitter followers. if they can't travel to brazil to join him next week, the pontiff grants indulgences, reducedded time in purgatory if they follow events in the twitter feed. dagen: all right. >> bless me, father, for i have sin. i'm going to tweet it. dagen: i want to ask connell about that. >> i'm going to get in trouble. i'm not making fun, but i had to go to the booth, not tweet it. i'm not making fun. dagen: of course you're not. it's serious. >> okay. dagen: thank you. >> you're welcome. dagen: thank you so much. union pacific, the railroad company reports its best ever
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quarterly results, second quarter profits up 10% from a year ago. how do they keep it going? jack is here to tell you he's the ceo of union pacific. jack, great to see you. how do you keep it going? i looked at the results, you had a lot of this from price increases. >> we had solid pricing, but there's a great franchise, great business opportunities, and we have a terrific team that's focused on creating value for our customers, taking advantage of every one of the opportunities, so that's really how we are doing it. >> you, in the statement in the release, said that the economic outlook is uncertain. how do you make decisions in the environment? that's been a theme sounded again and again, quarter after quarter, your results don't line up with the way you seem to feel about this economy right now. >> look at it from the
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perspective we have business that's economically driven and others that's not. for instance, looking at the oil business, that's not economically driven, but outside the dmi. the economy is not that bad, more sluggish in the second quarter than the first, but it's an op growth trend opposed to shrinking with some indications now looking at lumber carloadings, for instance, and even some extent some preshipping information on international that we might be starting to see trends pull up again. we're not pessimistic, but we have to be careful, manage with agility, make sure we have the people, the locomotives, and the kinds of things we need to meet the customers' demand. dagen: what are the hiring plans now? have they changed in the last several months? >> no, actually, they haven't. i think before the year is out, we'll probably hire somewhere close to 4,000 people. we have a large attrition base
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and expansion in the capitol programs and things like that, but on target to get 3900, somewhere in that neighborhood. dagen: in terms of the safety of the rails in this country and, of course, union pacific not involved with the train derailment in canada, but speak to that in terms to reassure the american people that that kind of accident will not happen here. >> yeah, you know, if you look at, first of all, the rail industry itself had the safest year in history last year as did union pacific. every year we're better and better, but there's opportunities to be even better than that. in that example in canada is a great example. it's tragic, an our hearts and prayers go out to the people involved with that, but we'll learn from that. when the dust settles, the investigations done, we'll take all the information from their accident, process that, and look at our own operating procedures, our training and development that we use for our employees,
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and things like that to ensure an accident like that does not happen here. dagen: other than that, what keeps you up at night? worry about interest rates? what's your sole focus or concern right now? >> you know, i do worry about interest rates. i look at -- actually, the thing that keeps me up is mostly a positive because i see so much potential that's out there right now. we have more people calling us, companies that, from the euro zone, companies that have been building in other countries over the world are now kind of looking at the united states, saying, hey, wait a minute, they have great transportation infrastructure. they'll have cheap energy prices. you know, there's a rule of law matches with their currency, and those are positives, we're seeing people make decisions that rather than build in germany b but build in the united states, and i just keep looking and thinking, how can we facilitate that and help that and how can we help the government reassure the
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manufacturing community that cheap energy prices are, in fact, going to pass through to the manufacturers and insent more business to locate right here in the continental united states. >> that really is great news, particularly, coming from you which i want to reit ray, union pacific literally touches almost every part of the economy in terms of the products you move on a day-to-day basis. jack, great to see you. thank you so much for being here. >> dag ergs n, good being with you. dagen: the ceo of yinon pacific. connell: talking about something going op right now as the global cyber threat continues to banks and government agencies putting themselves basically to the test. attacks, potential for that, and everything else happening now. that's coming up. dagen: millions struggle to protect themselves from the heat as rising t are really scorching large parts of the country. ♪
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from the hartford. why wait? ♪ connell: back to nicole. news recording that u.k. investigation in the boeing fire last week. >> right. while we are watching, obviously, both honey well and we remember what occurred friday was the fire, and the question was whether or not it was the boeing battery, ruled out, and looked to the honeywell emergency pieces, and seeing whether or not that was the cause of the fire. the investigations will continue. we wont learn more until a few days. honeywell is working with investigators and offered to take out and remove the emergency beacons out of all the 78 # 7s if needed insisting they have been doing this since 2005 with 3,000 emergency beacons and has not experienced a single
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problem with them but is willing to work and pull them out if needed if that was the cause of the fire. back to you. connell: more on that to come, thanks. >> more than half of all global securities exchanges fought off a cyber attack this year, and they are putting defenses to the test. >> we are talking about quantum dawn 2. it's a coordinated cyber attack simulation involving banks like jpmorgan chase, and others, and securities industry association are organizing the exercise. hackers will assault banks with different attacks, and they work from there in the workstation like a regular workday testing responses. they say we expect the exercise
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to improve the readiness of the sector as a whole to respond to a street wide cyber attack allowing each participating firm to test the coordination mechanisms and processes to maintain the resiliency. this is just the type of exercise banks need to improve defenses. the coordination part is perhaps the most important, an an attack in the financial industry is not likely to be limited to one institution. knowing who the peers are in the private sector as well as law enforcement make sure responses to attacks are quicker and more effective in the future. other security analysts say different sector, those running the energy infrastructure, should take a cue from the exercise and develop a simulated attack like this of their own. publicly traded companies are disclosing cyber attacks, though there are those who say businesses should be more transparent about attacks and how well they are preparing
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against them. connell: thanks. we have a former senior adviser, and, currently, brian white joins us from san fransisco. what do you think -- it's like a fire drill in school. what do you think we'll learn today as tests are taking place. >> i think what we're going to learn is that the banks are more prepared than most sectors. they have taken the necessary time and steps to be prepared, in fact, a good demonstration of how serious they take planning in the fact they are testing themselves. connell: on a number of times, here next hour on markets now, writing this paper years ago, and it might unfold against the banks, concern about the e-brokers, concern on insider trading and market data coming
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from a boomberg or whenever people get it, that that might be sabotaged. are you saying in the last few years, the banks have tightened up, that they are ready for about anything? >> well, two things, any part of the bank is a potential target. part of the motive of moacial attackers is just to cause disruption. some want to take information, intellectual property the bank has. what banks have been forced to do is put a variety of mechanisms in place to secure themselves. critical to the strategy is securing the information itself and putting multiple layers in place to make sure there's robust policy, protection, and they are taking advantage of the technologies to be a step ahead. connell: say you are right about that, and learn more about the test in the particular industry. if so, then i guess the
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potential attackers know that too, and they say, all right, well, the banks, they are ready. let's go after somebody else. who or which industry do you think in looking at this is the most as a vulnerable worrying ye most? >> two points. one is, you know, an attacker only has to be successful once where a security professional is right 100% of the time. the odds against us in the security community. with that said, what's critical for various sectors and those that have high intellectual property like pharmaceutical industries, aerospace, defense, financial services, the tech community is to put good policies, programs, technologies in place taking a page from the financial play book and test them. tip hats to the financial sector now because they are testing their protocols, information sharing with the government, and at the end of this, they really have a good understanding of how
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prepared they are if, in case, the event is real. connell: a realtime test, and they get set up like a fake exchange to respond to the attacks. thank you very much for coming on. >> great, thanks. >> day five and counting of the east coast heat wave baking millions hitting your wallet. more ahead. connell: it's hot. speaking of hot, nominations revealed that netflix, online series "house of cards" made history, and we'll have a report on that straight ahead. coming up, and before that, more numbers with ten-year yields above 2.5%. ♪ [ male announcer] surprise -- you're having triplets. [ babies crying ] surprise -- your house was built on an ancient burial ground. [ ghosts moaning ]
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>> the heat and summer, where we are at this point, but dangerous for people here because it's been some heat wave. the largest or biggest heat wave in the area since 2006. dagen: fox news' david lee miller in battery park city, new york city, with more. hey, david. >> hi. this is day five of the heat wave. it is a heat wave that's affecting some 130 million people in some 22 states, and washington, d.c., we are in lower manhattan, a popular park,
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a bicycle and jogging trail. take a look here. today, it is almost deserts. many people deciding they are best often staying at home in the air-conditioning than coming outside in the sunshine. the utilities continue to cope, but this could be a record breaking day when it comes to power usage. con eddy son advising customers not to have the thermostat lower than 78 degrees. they say it does not expect any significant problems. listen. >> >> we're halfway through without any major disturbances, blackouts, bronouts, or anything that they notice up to this point, and we're cautiously optimistic the rest of the week will be the same. >> just how much power will they
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provide today? they estimate 13 billion with a "b" to customers, supplying the juice for some 6 million air conditioners in the new york city area. in addition to the economic costs of the heat wave, there's a human toll. we are told that in kansas, a man with alzheimer's disease walked from his home. he died suffering the symptoms of heat exhaustion, and in new hampshire, a father allegedly left four children in a car. the temperature 97 degrees, and he's been charged with four counts of child neglect. meanwhile, back in new york city, folks are doing the best they can to keep cool. the city has 400 so-called cooling centers opening up for those without the benefit of air-conditioning, and, lastly, my friend here says it is now just about 93 degrees, and in the next few hours, we expect it's only going to get hotter.
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connell: there you go, david. man in the real feel, it's hotter than that. battery park in new york city. quarter until the hour here, time for stocks now, every 15 minutes. today, the market comets as it did yesterday to monitor ben bernanke and the testimony on capitol hill. today, as peter brarns reported for us earlier. so far, so good in terms of stock reaction. dow up, and the company at the new york stock exchange, headlines coming out today. we watched the testimony, carried it live yesterday, but just in the last few minutes, they were asked about quantitative easing, bond buying, and stimulus, has it done good? they provided an important boost at critical times. his quote. the second thing is on timing, all coming to you, when is this going to wrap up? well, ben bernanke said reducing quantitative easing at the september meeting is not a, quote, done deal. trying to say, well, what's that
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mean? what does that happen? that's the difficulty, i guess, for investors, figuring out when it wraps up. >> it's not new news. connell: you''e right. >> the good news is they prop up the economy is we need it, but bad news is, we need it. that's not new news. the rally is, in part, due to the fact the flexibility factor is there for the feds, but look at earnings with the rally. we've had 81 companies in the s&p report with 70% beating. i think that the u.s. still seems to be the place to be. we refocused on europe, and europe is having, obviously, problems, and, again, looking at those, and there's no other place to put the money. rally continues here. connell: we'll take that best of the bunch as we've been for a while. good to see you. thanks a lot. >> thank you very much. connell: all right. dagen: commodities have a mixed reaction to the federal reserve chief. connell: jeff flock at the cme
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with reaction there. >> i want to a if they care, but first the movers, gas, a mover, why? it's hot. you hear from david lee miller in new york. it's hot in chicago too. natural gas up, last check, up over 4%. crude is up today, and we have a narrowing of the spread in the wti versus sprint to less than a dare since 2010. does that mean anything? >> it's not significant. you know, what's significant is we have a nervous oil market and news better than expected makes it look like the economy's better than expected giving us a bump. >> i'll get the answer from you, does anybody care what ben bernanke says today? does anyone care on the floor? >> he's not the story today, that's the economic numbers, that's the driver. >> other moves, gold up six-tenths a percent, and corn down today, this weather is not
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helping the crop, you'd think. >> well, things are currently, but it's hot, we have wetter weather in the forecast putting pressure on ages. be careful with gold. with what they are doing, it's not inflationary cycle. buy the gold. it's a bump. ultimately, if we go into deflation their cycle, how effective is 1300 gold look to you? >> always the honest answer from scott. doesn't varnish anything. dagen: the way we like him. connell: the show "house of cards" a big day being the first online only program to get the top nod at the emmys. a lot of people talking about that. dagen: it is excellent, but it's costly. dennis has more on that coming up, and, first, from today's winners on the nasdaq. ♪
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connell: oh, man, this guy. dagen: the emergency emmy's arer the best in television, and this morning, best drama went to a show that never aired on tv at all. not traditional tv. connell: i didn't love it at first, but i got into it, and dennis will report on it because, hey, an online show, a
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nod at the emmy's. >> what's that say about tv and netflix? netflix got nine nominations for "house of cards," 14 nominations in all. best drama, best actor for kevin spacey, and three for "arrested development," but not best come by. justin baitman with the best actor nomination, henlock grove with two. second year in a row, house of cards is going to have to be a field here, madmen on amc, homeland on show time, my favorite, and downton abbey on pbs, and game of thrones on hbo. they stopped, tripled in the past year, and that programming brings buzz. remember the dollar numbers, hbo, profits last year, 1.4 # billion, reaches close to 30 million homes, netflix, 30
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million homes and just $17 million. you got to wonder where the money here is. spent a hundred million dollars on "house of cards." dagen: for two seasons. >> for two seasons. while 3% of the downloads for reruns, only 1% of downloads for showing "house of cards." dagen: 4% for star trek. >> yeah. dagen: star trek, 4%. >> bottom line. for now, buzz is great. i think netflix stock down today, but it's had a huge run, trying to get back the 300 level at last july. connell: it's not clear if it's the new model. >> it will be. connell: how do they make money? arrested development is the other one; right? dagen: which was not, frankly, not as good. >> they are buzzed for this. connell: how does it make money? >> right.
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connell: more money. >> this is it, the future, and maybe it will be, but they have to figure it out. >> the more you make, the more you flop. lucky out of the gate. dagen: one thing you push over and over and over again is the cost of house of cards. you mentioned that so much money. >> they didn't have dvd. sony got the rights. dagen: david fincher got a nomination? >> i don't know, maybe. connell: she's on at noon and one o'clock. you're all over it. dagen: i could be wrong. thank you, dennis. connell: he's coming up next with cheryl. stay tuned for that. and, well, will we ever get to the real truth of the irs scandal? that is a big question for dennis. in fact, that's what is bugging him, just one of the things bugging him tread. he wants to hear from you on that. weigh in there at the bottom of the screen. dagen: rolling stone cover, dzhokhar tsarnaev, walgreens is
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not selling it, cvs won't, more than half a dozen retailers said, no way. dennis and cheryl will talk about the fallout ahead with charles payne. ♪ anteed one-second trade execution, we route your order to up to 75 market centers to look for the best possible price -- maybe even better than you expected. it's all part of our goal to execute your trade in one second. i'm derrick chan of fidelity investments. our one-second trade execution is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.
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cheryl: i'm cheryl casone. dennis: in the immortal words, let me say, hey, shorty, it's your birthday, party like it's your birthday. cheryl casone, happy birthday. cheryl: thank you. partying on the birthday. dennis: new york and the country baking, but with the second day m testimony on the hill chill the markets? all over it. so far, no. cheryl: all right. hot stock today, bank analysts is here in moments. not only do they think it's one of the worst quarters seen for
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the banks, but they are pulling a fast one on you and everyone. okay. we'll talk about it. dennis: what's bugging me? will we get to the real truth of the irs scandal? my take ahead, and i want to hear from you, tweet me your thoughts. top of the hour, stocks every 15 minutes, and dow and s&p hitting all-time highs, nicole? >> this is one of the days for the record books a remember cheryl's birthday forever. well, maybe not, but we may surpass the levels, but we have set record all-time intra-day highs on the averages. the drug stocks, bank stocks are doing well. right now, the dow jones industrials up triple digits holding the gains, the fear index down, the u.s. dollar stronger. we continue, ben bernanke, the fed is giving the same testimony as he did yesterday. we've got out numbers from ibm and intel. doing well, pulling back, names like netflix and ebay with big news. a lot of names to watch, it's
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earnings season, and record day op wall street in addition to a very happy birthday to you, cheryl. cheryl: thank you very much. she still wishing me a happy birthday. thank you so much. we are blurry-eyed when we come in. breaking news, ben bernanke saying that tapering bond buying is far from a done deal. peter barnes in washington where we continue to testify for a second day, and these comments were an add-on to yesterday, not just a rinse and repeat. >> that's right. some senators bigging down trying like the rest of us to find out where the fed chairman thinks all this will go. when the fed could taper the bond purchases. you know, a lot of analysts on the street speculating the september meeting, but a senator pointed out since the june fomc meeting at which it past tapering was laid out.
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laid out, if the economy keeps growing, if job creation stays up at a good pace, they could start tapering later this year. some not great economic numbers. there have been some data points since then. i think it is way too early to make any judgment. what the fed is breaking into the forecast is dissipating later in the year.
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cheryl: i like that you use the word presumably job creation. peter barnes, itself. dennis: sam stovall say though both have been done. the second half of the year has seen an average job of 7.5%. you have some other reasons to bullish. >> first off, let me remind everyone that history is a great guy, but it is never gospel. i think momentum does tend to be self fulfilling. 83% went on to celebrate their
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fifth birthday. history indicates that once we recoup what we lost in a prior pullback which is what we exempt from the end of may to the end of june, we tend to rise anywhere from four-8% before slipping into another duck line. that would point to about 17 before we go through another digestion of gains. dennis: by how many months, how many years? >> usually, it is a matter of months. it could be something that we see in the latter part of this year. dennis: we just had a technician on yesterday. do you think that the stock rises wonderful? some people say it is all soufflé. it is not based on real
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strength. >> i would say look at the earnings data. we still trading at double-digit discounts. you could question whether these earnings are true earnings or whether they are shenanigans of share repurchases, felt tightening, etc. prices lead fundamentals. what we are seeing happening now is more a reflection of what the market thinks will be happening six-nine months from now. dennis: you like discretionary, healthcare and financials. >> yes. good earnings increases. getting a little party at this
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point. we are going with the momentum, financials. providing this group with good momentum. healthcare is the most typical of the defensive sectors. dennis: especially with government monday. stay away from telecom and utilities. why do you say this? >> interest rates are going up. if we look at that season of fact, it tends to bring prices down. it has a similar affect on higher-yielding sec tours. despite being sold off, they are still trading at very high ratios.
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dennis: liking all of that optimism. thank you very much for being with us. 16,000. here we come. cheryl: a big piece of what we are seeing today are the financial names. they are soaring on earnings reports. the weirdest thing he has ever seen. these banks just did a con job on all of us. bank of america getting an upgrade today. morgan stanley a new high. >> essentially, you know, i think that 18 companies that have come out that i have looked at so far this season, there are two. morgan stanley and wells fargo. almost all of the others showed the clients and loans, the client in net interest income,
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declines in mortgages. cheryl: goldman sachs had really strong trading revenue. >> no they didn't. basically everyone of these companies show weakness. your last interview, i think you hit it on the head. nobody cares. people want to buy stocks. they are convinced that there will be a very strong economy by the end of this year. by the way, i agree with that. i know that you should aid nor what is going on in this quarter. cheryl: i was looking at the profits. if you are going quarter to quarter, i am looking more year over year. those were profit numbers. the earnings per share, it was
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100%. one of the things that i found about morgan stanley today is that they did this by that. government approved it. it seems like we were able to get the taint of the bailout. >> we have gone 14 quarters in a row using year-over-year statistics. the industry earned more money than ever before in its history. the banks have been earning a great deal of money. however, you will see that virtually every one of the major products that banks cell have declined. cheryl: are you including home loans? >> they have come down because refinancing has weekend. basically, what you are seeing is a reduction in loan loss
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provision. a reduction in operating costs. a reduction in tax rates. capital gains, unrealized capital gains. of assets.eing, basically sales all of this stuff is being thrown into the earnings picture in the second quarter for the industry making these bottom-line numbers look good. bank of america is a perfect example. essentially, their loans were flat. their net income was down. their margins were flat. they showed a 50% the client and trading activity. cheryl: bank of america, there was certainly a cost reduction piece of it that would be positive. >> i am saying, you know, if you want to grow a business, you have to grow revenues and more
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of your products than you manufacture. i am not telling people not to buy bank stocks. bank of america continues to be my favorite stop. morgan stanley is also one of my top picks. what is fascinating me is that these banks have reporters type of earnings two years ago. they would have been arguing that there was no improvement in core earnings and all the improvement was coming from poor liberal areas. we think that the outlook for the what has changed is the psychology. we have gone from everything is miserable to everything is wonderful in this industry. i am going along for the ride. cheryl: i am glad you are saying you still like the banking
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sector. the profits are still there. thank you for being here. >> thank you. ♪ dennis: what it'll be me? the irs scandal and how it has disappeared from our conscious. the media easily dismissed it as a small time. even republicans are backing off. this is not a partisan issue. it is an american issue. we have the right to a fair and impartial irs. clearly, it is not that at all. the irs targeted dozens. clogged up their applications for tax breaks. irs blames a few bureaucrats in cincinnati. the general counsel in washington, a white house appointees personally held up the cases. lois lerner was involved.
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no wonder she took the fifth. 150 trips to the white house. three times as many as treasury secretary geithner. tweet me that dennis kneale. will we ever get to the real truth in the irs scandal? cheryl: all right. is not a movie. it is a mob cyber attack on the market that is now underway. we will explain coming up. dennis: original series scores emmy nominations. lots of them. my media minute is next. cheryl: this rolling stones cover. charles payne coming up. ♪ my mantra?
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cheryl: potentially looking at another. high for the dow today. look at bank of america, jpmorgan chase. let's bring in nicole petallides. nicole: i am watching dell right now. today was the day, july 18, the meeting convened. it has been moved to reconvene on the 24th. it certainly is a complicated matter. many people who are in support of michael dells offer. some of those actually were on the fence.
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in that 11th hour, they have come through. the question is whether or not karl icahn, he continues to fight his fight. back to you. cheryl: thank you very much. ♪ dennis: time to make money with charles payne. banning the latest issue of rolling stone magazine. what do you think this means? dennis: cbs was the very first to do it. i find it very interesting. speaks i was going to ask dennis your thoughts about this as well. dennis: another desperate as
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measure by magazines. the thoughts that stores will censor or decide that i cannot buy this because they do not like it. that is censorship. i think it is a mistake for retailers to start getting involved in individual case. >> everything they sell goes through a process. this is the one that we like. i am not saying designing everything else. everything we go to the store and buy has been dented by that sort. cheryl: the third paragraph about rolling stone came out with a paragraph and they said they understand that it is a hot button issue. his friends say he was a beautiful boy with a gentle demeanor. a laid-back demeanor. a boy that you can just live with. really? in the third paragraph of the
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story. dennis: they do not have some sort of journalistic fiduciary to do to their shoppers. dennis: we get offended by images all the time. how about we let the free market decide. >> that is free market. six. cheryl: does it hurt sales? charles: this may have been the ultimate hail mary for their website. twenty-two years old and in charge of all the content. this does not jumpstart their website. perpetual decline.
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they ruled the world. they really messed up on politics. particularly, when they went after reagan. charles: it was a reggie jackson swing and a bat. either a homerun or the ugliest strikeout you have ever seen. dennis: not liking gunplay. let's go ahead and put an alleged, accused terrorist on our cover. thanks a lot, charles. cheryl: all right. from heat over that magazine to this. it is certainly hot outside. the east coast heat wave is putting pressure on electric utilities. dennis: netflix is on fire. both the stocks and the series being produced by the company. both the head in media minute. first, how the world currencies are faring as the u.s. dollar.
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businesses individuals to buy health insurance or face fines. bipartisan group of senators voted to restore lower student loan rates approved, undergrads would borrow through 2015 act 3.85% interest rates, grad students at 5.4% and parents at 6.4%. we expect an announcement later this hour. it is nelson mandela's 90 fifth birthday and he has been hospitalized since june with a lung infection authorities report his condition is steadily improving. we wish him well. those are your headlines. back to dennis and cheryl. happy birthday.
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happy birthday, cheryl. cheryl: just down the street. dennis: one of the covers. dennis: that is a pretty nice birthday wish. temperatures are soaring across the midwest, the worst heat wave of the summer continues, and rick had a latest from the fox weather center. >> i cannot believe she sang happy birthday to you. incredible. you need to record that and keep it forever. incredibly high temperatures, yesterday in the big city, everyone is in d.c. and in detroit and minneapolis and the central plains temperatures in the 90s and when you factor in the humidity of to 105 in detroit. a big area of the country dealing with heat and if you look at temperatures you see 80s to the south and 90s in the north and most is across serious towards the northern tier of the country and that does not happen
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often but that is what we're seeing and factor in the humidity and see what is happening, feels like a hundred in new york, 102 in d.c. another hot day. changes come and go from a cold front moving down from canada. we will see severe weather across minnesota and wisconsin and michigan and that friend begins to slide toward the south and behind it with a cooler air is but because the front moves through we will see severe weather. tomorrow across the great lakes and saturday at big stormy day across the northeast towards the ohio valley. the good part is behind that, temperatures drop. in new york three days, today, tomorrow and saturday temperatures in the 90s and mondale little below average, we will be happy to see that. dennis: thanks. cheryl: it is fox business summertime showdown. all the stock picks are in from
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eight competitors. tomorrow we will see the first elimination. chad morganlander kick this off. it was a month ago, bigger was better, picks walmart and triumph group's visit -- over smaller names like tootsie roll and w. d. 40. look how wal-mart is fairing against tootsie roll. could come down to the wire tomorrow. don't miss chad and oliver for the week 1 results on fox business at noon eastern time. we will see who makes the back. or doesn't make it back. dennis: will we ever get to the bottom of the irs scandal? that is bugging me today. wheat me at dennis kneale. cheryl: as the global cyberthread continues banks and government agencies put their security to the test. we will check in on how it is going. i want to make things more secure.
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cheryl: time for stocks. nicole petallides on the floor of the stock exchange. nicole: earlier today i was talking about the fact that honeywell may remove the emergency locator devices authorities have been looking into why there was a fire on that boeing 787 last week on friday and they thought this particular beacon made by honeywell might have been cause and now all moments ago it turns out the emergency locator beacon should be switched off. they are identified as the most likely origin of that recent fire according to the british investigators. let's check on boeing which is up 2.5%, pulled through this fire pretty well. stock has continued to do well particularly because it was not the boeing battery which was the
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big concern for the 787s overall but this news came out moments ago. they will switch off those locators. cheryl: appreciate the update. dennis: it is code-named quantum don 2, marc cyberattacks on the markets. rich edson is monitoring it. >> jpmorgan chase, wells fargo with the fcc treasury joining along with the top cybersecurity experts, happening right now, quantum don ii, coordinated cyberattacks against the country's financial system, and face a barrel in the quantum gun 2 exercise to enable individual firms and the sector as a whole to test their response plans in order to maintain affective and orderly markets and protect clients. one cybersecurity expert says
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defenses are among the best because they have plenty at stake. >> the financial community is well aware that if many of us are impacted and we start losing our account their entire infrastructure of online payments goes away and they can't afford that. >> they hope to steal customers personal account information, someone to disrupt and damage the banking system. analysts say other industries have held simulated attacks like this testing their defense to protect their systems and intellectual property. some estimates put u.s. losses to cyberdraft that hundreds of billions of dollars every year. cheryl: we will continue our discussion of quantum done 2, bring in former data risk-management specialists and micro vice president of cyber security tom kellerman who joins us from washington. our reporter actually spoke with, that little sound bite, he said the banks have the best
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cyberwalls if you will in the world but yet sifma has a different perspective. where is the truth? >> the truth is the financial sector and specific financial institutions have greater cybersecurity than most industries that the most sophisticated hackers in the world are targeting those very same institutions and you are seeing an evolution of weaponry in the underground that would be utilized to bypass all. sheriff you look at world bank and cooperative study in 2005 about cyberattacks but at the time it was not in the lexicon for many of these banks, now, today called a major players are participating. sifma the ones running the show. what does that say to you about how bad these attacks have been? >> i would complement the industry for an president information sharing with the government and by lateral fashion. however, we usher in a new era
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where in the modern day da on gillette -- john mallinger gangs are cyber and not just focused on stealing money but things like market manipulation, front running, insider-trading, broker compromise and impacting liquidity of markets to incur capital flight out of the u.s. economy. it is not just individual actors but regimes like iran who are behind many of the attacks we have seen. cheryl: i have heard it called low war game. i remember the movie from the 80s with matthew broderick but this is basically what is happening right now. take us behind the scenes of what sifma is doing. is a fake exchange they have created. >> essentials lead they have the best people from the incident response teams to the heads of cybersecurity, 50 financial institutions and department of homeland security and the regulators particular in in a simulation with the red team acting as the adversary. i hope the exercise is not just focused on denial of service attacks which we have spoken of in the past but more on
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thwarting the attacks posed by targeted major tax that developed destructive payload that could destroy the system is. we have seen an increase in the use of destructive payload against the financial sector of late for the purposes of clean up mechanisms or counterincident response. cheryl: i don't want to give too technical, but this is jpmorgan, this is citigroup, this is banc of america, banks large and small who frankly have the most to lose when it comes to a cyberattacks because they lose customer trust, you lose customers, you lose value, you lose money. would you agree with that overall assessment of what is happening? >> safety and soundness can be put in jeopardy, trust and confidence is financial to the sector. the three institutions you named i consider to be the most proactive in how they manage cyber risk. however they are also targeted
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by the most sophisticated eastern european, brazilian and middle eastern hackers in the world. cheryl: we are three hours into it, they have until 2:30 and don't know when it is coming some interesting to see how they react to this threat and how they handle the. we will follow up. tom kellerman, thank you. dennis: dell shares trading higher, michael dell failed in his attempt to kid take the company private, thought it might lose. the latest on that ahead. cheryl: net shares are lower after hitting a 52 week high earlier. the company gets the first non see the company, media minute with dennis coming up on that. ♪ [ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros with dedicated cha and daily live webinars.
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>> i am tracy byrnes with your fox business brief. mortgage rate falling to a two year high as comments from federal reserve chairman ben bernanke concerns about the central bank reducing its efforts to stimulate the economy. according to freddie mac the average rate on a 3-year loan is 4.37%. ford seeking to the number one spot as the best received firm in america. the automaker is not first anymore but among all companies. amazon coming in second with subway, history channel and lows rounded out the top five. twinkies and other hostess
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brands fly off the shelves, the company says they are seeing liquor demand with sales three to six times greater than production. that is the latest from the fox business network giving you the power to prosper.
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dennis: gold trading 2% higher as the shareholder vote on michael dell's controversial buyout bid has been postponed, supposed to happen this morning and now it is going to be july 24th and joining me with his take morning star equity analyst, thanks for being with us. michael del bind himself more time drawing support for the offer. do you think it will work? >> tough to tell. looks like it will be a very close vote. michael dell has had some time to close up shares but obviously one more week might be able to push over the top but it is too
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close to tell. dennis: $15 a share bid, this is the best shareholders are going to get. why is that? >> we think shareholders should look to take the money and run. power ally con's proposal -- carl icon's proposal is one reason to vote against it but there are long term ramifications and also you have ton's proposal is one reason to vote against it but there are long term ramifications and also you have toahn's proposal is one reason to vote against it but there are long term ramifications and also you have to assume you'll get 50% shareholder support to elect his entire board nominees after the board of directors, the only way he can get the financing he needs to enact his proposal. dennis: i certainly trust michael del to turn around the company than carl icahn. he has had the race away from pcs and laptops to smart phones.
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why does michael del need 32% voter approval? >> he has 16% equity share and he is not going to be partaking in the buyout vote, he can't vote for himself so the remaining 84% is what you need a majority from that coming out to 42% approval michael del needs. if you don't vote that is a vote again so he needs 40% approval. dennis: if you don't vote is a vote against. that will kill him because no one will vote in these things, they vote by buying or selling shares. why isn't he voting his own shares? is it regulatory not allowed? if you own a 16% stake in your company you want to be allowed to vote those shares anyway you want. >> he has recused himself. dennis: he has recused himself. that is a problem. we have other companies, google, the top three guys, and
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cablevision, but this guy has to take his own 16% stake off of the table. so sorry to hear that. tries to do a good thing but it backfires. >> that is one of the things that is a risk to carl icahn because it is voted down he needs 50% of the total spending shares in order to get his board of directors nominated and michael del can take his 16% in swing it against anything carl icahn decides to try to enact. there is a little more of a down side. dennis: when it comes to the carl icahn proposal he will go ahead and vote those shares. he owns them. thanks for being with us, good day. cheryl: let's go to the floor of the stock exchange. the date for the market, numbers look like we are backing off of session highs for the dow but do you feel this is more about ben
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bernanke's testimony or more earnings focused today? >> happy birthday. i think it is based on earnings. we are hearing the same thing over and over again and what we heard yesterday was something we heard for the last few months so i will say this is more about earnings than anything else. cheryl: any particular sectors you like or don't like? >> financials. i am always watching financials. they're coming out with the buyback and in general financial earnings have been very good and the financials being solved we have good possibilities for very sustained rally. cheryl: the buyback was a big surprise but a nice one. thank you so much. natural gas biking after supplies in weekly inventory, let's head to the trading pits of the cme, phil flynn. >> this was when natural gas was supposed to get above the 5-year
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average. last winter was so cold and supplies were drawn down, june was very full, didn't turn on our air conditioner, that didn't happen today and the reason that is critical is next week we know we will not get supplies above the five year average. the reason is hot temperatures, look at the report today that came in at fifty-eight billion cubic feet, there was more demand and less production than anticipated. we know the power generation next week will be a lot more because it was just announced new york city will have record power demand today. we will see its in next week's report. cheryl: you are not kidding, of chicago either. no wind in the windy city today. great stuff. dennis: and the nominations came out this morning and the winner is netflix. for the first time ever show that never aired on television has been nominated a major
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category and netflix's original series house of cards that's nine not including best drama, best actor for kevin spacey and best actress for robin wright, got 14 and in emanations total including three for arrested development but not best comedy, and that shows you how the tv business is changing in the internet age and the second year and run them and of of the best drama nominations went to rashad a major broadcast network. house of cards will have to beat one heck of a field, madmen on amc, homeland on showtime, downtown at the on pbs and game of thrones on each the 0. a result programming creating a buzz for netflix and helped the stock price and triples in a year. the new study says house of cards got only 1% of tv download at netflix and reruns of madmen got 3%. gerri: you were saying producers of house of cards made, stake in
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the dealmaking. dennis: netflix paid for it and dvd rights went to sony said it put up 1 the did million dollars for a season it doesn't even own the rerun rights in perpetuity. usually if you pay for it you own it. cheryl: new wild fires threatening southern california homes. details coming up with the west coast minute. dennis: your last chance to get in on what is bugging me. will we ever get to know the real truth of the irs scandal? your answers just ahead. we used to live with a bear.
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[growl] we'd always have to go everywhere with it. get in the front. we drive. it was so embarrasing that we just wanted to say, well, go away. shoo bear. but we can't really tell bears what to do. moooooommmmmm!!! then one day, it was just gone. mom! [announcer] you are how you sleep. tempur-pedic.
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cheryl: time for west coast minute. more wildfires to tell you about in southern california happening west of palm springs. several homes and mobile homes have been completely destroyed or are threatened at this hour, thousands of presidents have
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fled with the authorities warning there may be more evacuation is today, the winds have been changing and not for the better. las vegas continuing its massive renovation, and expanding adding new york city steakhouse b l t sticks set to open in 2014 and 93,000 square foot restaurant will have a fireplace, 250 seats in the dining room, everything else in new york city about a pop over. they are really good. finally barnes and noble may be struggling to keep stores open and business going the unit of the company has signed a deal to operate allied pacific university bookstores which are to the largest university bookstores in the state. the unit barnes and noble college has deals with 650 colleges and universities around the country. that is your west coast minute. dennis: i asked for your take. will we get to the real truth behind the irs scandal? here's what you had to say.
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brad mosley says i don't think we are nation of amnesiacs. there is a direct counter in tension within the department of justice to investigate the irs. seymour says you are joking. they're investigating themselves? gus says it is disgraceful the administration has because it but it's become so unresponsive to the people there represent. cheryl: from your twitter responses it is hard to find anybody that is sympathetic to the irs. dennis: a lot of heat on the mix up with charles payne over the magazine cover. they have every right to sensor. cheryl: looking at the article, how it was written, i could see where people were taking defense to how they were describing it and it looks like jim morrison on the cover. dennis: once this taurus sensors that cover if kate upton comes up with too much cleveland -- cleavage there's a new standard. cheryl: i can see men wanting to sensors that. back to barnes and noble, the
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ceo, time for them to return, maybe there should be many malls. dennis: roger martin from the school of management joins laurie and i. it will be rory and me. lori and.
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>> 1:00 eastern, lori rothman. welcome to markets now. dennis: i am dennis kneale. markets are breaking records as fed chairman ben bernanke does an encore on capitol hill. will we see catering in september? deutsche bank says you bet. lori: dell deal a. shareholder privatisation delayed until next week with large investors like black rock and vanguard on board. what is the hold up? dennis: netflix making history. not only is the stock hitting new highs butirst time ever an online program garners an emmy nomination for best
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driver. lori: we will get into that but let's update you on the broad market. as we do every 15 minutes let's head to the stock exchange to check in with nicole petallides. record day for stocks but the dow off a session highs. nicole: this is the david goes down in history, record all time highs for the dow jones industrials were off of those highs. we had triple digit gains. the third index to the downside, the dollar has been stronger, some has been buoyed by good economic news. and in addition the four week average, an improvement which is that. i want to look at two in particular, united healthcare stocks are doing well helping to keep this market afloat, the best performer hitting a 52 week high, better than expected earnings, the good news,

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