that's the steve jobs scenario, a price target of $466 on that scenario. >> which do you think he is? >> henry ford. of course. >> always good having you. >> good to be here. >> lighting unthe room again. guys have a good friday. hand it off to the jump and the "half." welcome to the "half time show," we're expecting to hear from president obama in 15 minutes and will bring you that statement live when it happens. first, let's meet today's starting lineup. jon najarian, co-founder of option monster. pete najarian also a co-founder. joe terranova, manager at partners and begin with stocks on track for the biggest weekly gains in six weeks. don't look now, even with all of the global issues weighing on the minds of investors, even with europe teetering on the edge of another recession, the s&p is only about 1% away from its alltri-time high suggestinge u.s. is undoubtedly the best place to put your money these days. or is it?

we welcome in the chief economic adviser for his take. a while but great to welcome you back to the "hoof tialf time sh" >> thank you, scott. >> what do you make of the u.s. ability to brush off all of these concerns and march towards the new highs? >> impressive and a bet on the fed and a bet on central banks and the rest of the world. >> well, the bet that they're not going to end their stimulus anytime soon in any great magnitude i guess? >> yeah. if you look at this week's data. you are mentioned it. shockingly poor. both out of the u.s. and out of europe. what does that mean? it means that central banks will be dovish for longer. what does that mean? the market needs to continue to bet on the fact that the central banks have been the market's best friend. i agree with all that. two really important qualifyifications, scott. swun valuation matters, and at this level of valuations for the bond market and equity market,

they are telling you different things about the destination. that's the secretaond issue. not enough to bet on the journey. you need the destination to come through. i'm more nervous this bet on bad news is goodness. there's a limit the higher valuations go. >> i had the pleasure of being on "squawk box" yesterday morning and a gentleman came on there, a very noted strategist, who raised the issue of getting double digit returns over the next few years in the stock market, talking about multiple expansion, given where earnings are coming in based on the fact that interest rates are so low. is that, that farfetched of a scenario to consider? even in the wake of everything that you mentioned? >> you need a few things to happen. first you need the geopolitical head winds to die down. that's really important. because they're getting cumulative, scott. a limit. central banks cannot fight geopolitical head winds for a long time. the first thing. second a successful handoff from

policy induced growth to genuine growth. if you get these two things, there's a ton of cash on the sidelines, still, and there's lots of great innovation going on. the problem, scott, is the probability of getting the first two things happening, not as high as the guests suggested. >> guys? >> well, one of the things that always makes me a little nervous about the overseas markets, so i don't disagree with your call at all here, the liquidity factor over, if talking about europe broadly, or some of the most liquid markets are, of course, in london markets. but then you go across the rest of europe, and we trade more in the first 15 minutes than they trade all day long. so the liquidity just isn't there. now, yes, these are big market cap companies, but as far as the access and egress in and out of these stocks, it's just not there. so that -- does that factor into your equation as well? >> it does, and those of us who

lived through the consequences of the taper tantrum, when liquidity evaporated, and evaporated intensely in certain segments, be it the non-u.s. markets, the developing world, will tell you that the liquidity factor, the liquidity risk is under prigsed today. the reason it's yurnlder priced is because we haven't had a liquidity disruption since january. so i would make a more general point which is that liquidity is being underpriced today. when sentiment changes, the broker dealers are not there to absorb paper on their balance sheet. they want to get out of the way just like everybody else gets out of the way, and investors should remember that. but right now, liquidity risk is not a major concern for most investors, unfortunately. >> you pass a note this morning, at about 9:40 a.m. with a headline, markets are making a sucker's bet on europe. you want to elaborate on that, tell us exactly what you're talking about? >> yeah.

the bet on central banks assumes not just their commitment, which i totally agree with, but, scott, it assumes the effectiveness that somehow central banks acting on their own will be able to deliver great economic outcomes. now, as stan fischer reminded us monday, the central banks have had to revise down year after year their own projections. falling short of their oh projections. the reason is simple. using imperfect tools to try and achieve economic outcomes. so unless the other policymaking entities get into the game, then we are going to play this repeated game. meanwhile, the risk of financial instability goes up. my concern is, not whether the central banks are committed to being the market's best friends. they are. because they need the markets to attain the economic objective. my concern is that the tools may not be adequate. and at these valuation -- remember, everything has a price. at these valuation, markets are

betting both on the journey and on the destination. >> it's joe. so i guess the question becomes on friday janet yellen comes to jackson hole and as you said probably tells the markets she continues to be their best friend. how is it that you should react as an investor or maybe even a trait trader on the other side of that? reducing allocation to equities, fixed income? what do you do? >> i think she will tell us she's the market's best friend. she will put that in the context of slack the labor market and therefore, limited concerns for price inflation for goods and services. i doubt she will mention asset price inflation as a concern. that is left to other people to mention. she tends not to talk about this. and she will say that she doesn't see the need for anything more than macro credential policy. all that is consistent with the narrative. the one thing the markets have to ask is -- why is it that the equity market

and the bond market are betting on two different outcomes? the equity market is telling you the handoff from policy growth to general growth is going to work. the bond market is telling you, hell, no, it's not going to work. otherwise you could not reconcile these two things. we have interestingly and the gap is getting wider, two major markets betting on different outcomes. >> i've got do run. my last question, ask you for a swhoo quick response, if you could. does draghi have no choice but to go to full-blown qe in europe even though it's more difficult than to do here? >> yes. full blown and even looser credit policy. >> and he will do that, you think? >> he will do that in september or october. >> great to see you. thanks for coming on. >> thank you. do our trader blitz. three trades on three stocks making news. first um, "weekend updatw walma. citing higher employee health care costs. >> focus on the same-store sales

growth, which you have not seen now in six consecutive quarters. so again, we reiterate i believe walmart now is dead money. where's are you seeing, the growth? seeing it in costco. pulled back nicely. i think right here's a great opportunity. that's your hyper markets trade. >> interesting you say costco. i want to bring it up here because you mentioned that. >> okay. >> jim cramer, stephanie link, left the building. they have sold out of costco. cramer this morning calling it one of the toughest decisions they've ever had to make. >> okay. >> why say costco is a place to be in a world where amazon is crushing everybody? >> because when i look at the big box world, when i look the hypermarket model, i believe in, given some economic figures and consumer discretionary itself, i look collectively at the three of them, target, costco and walmart and make a decision, who's the best in breed?

all things being equal now, where do we see the growth? it is costco and again has pulled back significantly. so i like it. i want to own part of that space. the only place that i would be could be costco. >> look at the reaction of walmart. i'll push back on everything you said. the neighbor stores up 5.6%. impressive. something to go after the dollar stores. right? e-commerce up huge. talking 26%. they were -- >> biggest seller in -- >> right and attacking and site gets better every single day. process gets easier. obviously people are going there, using it that much more. everybody would have told me -- >> why's the company been so dire, pete? why in its own words so dour about what's happening? >> because the growth of the entirety of what we're talking about in walmart just isn't there, but there are pockets and just like everybody else. trying to re-invent themselves. look at stock reaction today. says a lot about what people think about walmart here and get that dividend yield as well. >> cisco falling despite beating estimates on top and bottom

line. reporting it will cut 6,000 job, 8% of its workforce. doc your read? switching businesses? routing businesses? core businesses? not doing so great. >> sdn, though, software side of their business, judge, is doing much better. as i said last night, one of the reasons to bet on them going forward. the stock bottomed out last night around 24.18 or so in the after hours. now about 40 cents, 45 cents higher than that. it's still down 56 cents. i recognize 2% drop isn't what people would like. nonetheless, i think it's very stable and it's been working its way up throughout the session. i don't say it get back to break even today, judge, but a reasonable report, not a bad one. >> still ahead on the "half," we mentioned we're waiting for president obama who is expected to speak around 12:15. on iraq, and the situation unfolding in ferguson, missouri. we will bring you those comments live as soon as the president

does head up to that lectern there in his vacation spot of martha's vineyard. and you heard, just made a case for taking off some risk. coming up, a technical trader who's doing just that. find out why mike harris of campbell and company is selling 70% of his stocks after being bullish for more than two years. first, noodles, candy crush, potbelly, we're talking about what some say are one-hit wonder stocks. which companies are too dependents on one prond and which are just misunderstood? calling out fat stoux after the break. plus retail earnings kornt to disappoint. where jk pcpenney deliver the gs tonight? stick around and joe and jon square off in a debate over pennies. with all the opinions about stocks out there, how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers

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♪ all right. welcome back. listening to one of joe's favorite one-hit wonders. [ laughter ] and why one-hit wonders may be fun to listen to. they're not always easy for your portfolio. as you know, dom chu has more on that story. a lot of people talking about some of these so-called one-hit wonders. >> not passing judgment. again, the markets are. right? look at market. telling you something about them. we're going to call it first of all, the first one, a wet

noodle. right? noodles reported earnings and sales fell shy of analysts estimates and lowered full year outlook. the story -- after going public in june of last year, at $18, this stock doubled in its first day of trading. hit a record high of nearly $52 just two days later. 190% return in the first week. then it's fuelen by over 60% given today's steep losses. a big one. then potbelly. anotherfooft casual restaurant debuted ats 14ds in october last year 120% return on the first day of trading. it was an all-time highs 34ds. since then down $12.50 a share. also a 60-plus percent drop from the highs. >> make good sandwiches. i don't care what anybody else. >> they do. no one's passing judgment on the sandwiches. they're good. the stock, maybe not so much. >> hot peppers there, good, too. >> i like hot peppers on everything. i love you scott, for so many

reasons, but because we have so many similar tastes. >> we do. your golf swing is better than mine. >> i don't know. we got to work on that together. the other? king digital. of course? talk about this one here. this thing got crushed. we all know why. interesting numbers, but lowered its full year guidance and said, maybe there is competition. maybe there are questions about its business model here. remember, it's started trading at -- didn't start trading. ipo-ed at 22.5. march of this year. dropped 16% in the debut and hit a record of $23.50 last month and now it's 40% lower than where it was from that record high and, of course, one more here. i want to throw it out there as a, maybe a bellwether if will you for sentiment. gopro. $24 ipo on june 200th. 31% pop, first day. record high, $50. now down 20% since then. the question becomes, it's still

above its ipo price, but the jury is still out here. does it become one of those one-hit wonder type stocks for now? >> jury's out. throw to the jury. guys? take any one? noods noodles, gopro? >> king, a one-hint wond jer comes down to candy crush being the only big name. you have to produce something else. if they can produce another game, they can put themselves into the mix again. the valuation of the stock, now the problem is, it's all on one -- look at what's driving it, it really is just candy crush. >> i would say, though -- >> gross bookings. >> zynga had the same issue with farmville and tried to come out with another franchise pap slew of other games, couldn't replicate. does that become the model? >> zynga, people were fearful as king would come out, a similar slide, subsequent to the earnings, and you saw what happened. >> no. you know, a lot of these names, you're talking about. listen, gopro, completely

differ. i think gopro is different than the other thee names you mention. looking at all three of these names. what are you going to do with them? buy them and put them in a portfolio and sit with them for 6 to 12 months, ride out the volatili volatility? . no. trade around them and looking for pure momentum on other side. whether up or down, it's a ride. i don't think the case of any of the three names, that we're mentioning as potentially being left for dead, there's anything right now that would tell you that they're going to reverse the negative momentum. it's in place. that's been established. you take those three names. if i were me, completely forget about them. dead money. >> red robin gourmet burgers. worry about that. >> down 2 percen20%. >> trading at a new low. i don't know the proposition. a lot tweak shake shack, emburger, all of the places that compete for these same dollar, and it doesn't have the benefit

that chipotle has as well as we're very green and organic and all the rest of it. when you're talking about a burger chain, i don't know why you'd jump into red robin gourmet burger. >> scott, one thing i would add to close up that restaurant conversation. everybody is looking for that next cmg, the chipotle. ride? trade around -- you didn't have top trade around chipotle. went sky high. champion does that? >> loco. is that going to be the one? >> okay. dom, thanks. >> you got it. coming up, trader trade-off series gets a little class today. when we find out what jon najarian does when not trading. grooming his ponytail? ballroom dancing? >> no. >> find out what he is doing. having a good time, for sure. which u.s. companies have the most exposure to weakness? that's coming up. a bad week for retailers.

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after all, you can't turn dreams into airplanes unless your passion for innovation is nonstop. ♪ welcome back. markets are higher. there are stocks hitting new 52-week highs. invesco and xerox fell back. jcpenney set to report after the close today. after the disappointing report from macy's hit the sector, a 25% drop over the past year, is it an opportunity to buy the stock at discount or is the

entire sector out of style? debate it now. logon to cnbc.com/vote. decide the winner in realtime. jon the bull. joe the bear. buck 30 on the cloct. doc, go shopping. >> i've said before i'm not a fan of buying stocks pep ahead of labor day, judge. labor day, fine. as far as jcpenney, restructuring costs and the court of pension restructuring, that's has already been playing out. in other words, i think that helps them add to the bottom line going forward. closing stores. joe knows this. at an accelerated pace. 32. might surprise us an announce a couple others, which i think would be positive. they had 6.3% sales increase, judge. >> looking at the vote. you better talk faster, or do something. >> well what -- >> jump up an r and down or something. it's like 96% -- [ laughter ] >> what i like about them here is -- >> joe, be quiet. joe's doing fine. >> the first time in 30 months went positive on the last report. as far as same-store sales. i think they do it again, and i

think the stock goes higher. >> okay. 89% going with the bear. >> i can't win now, as i look at this. >> shows you, it's a sentiment story more 2457b anything else. >> people don't pay attention to fundamentals. >> look at it now. how you have to look at it. long the stock tonight. by the way, you sell short the stock tonight that is completely foolish, because everything that jon is highlighting is actually happening. there's a management turnaround. a traffic turnaround. that was the inflection point in april. >> but if there's -- >> hold on. hold on. you don't go short the name. however, you ask yourself tonight with the stock trading $9, do you remain long? okay? you get a good report. add that as fast as you can. why? cash flow positive. not happening by the end of the year. the most important condition with the value at jcpenney at $9 you tradeoff. credit high yield market telling you it's running out of steam. >> what if -- some people think it's great.

what if there's a market share turnaround? what if they're taking some of the market share back that they lost to macy's? not that far femped to consider? >> tried to use the power of voice on nobc as far as traffic into stores. sounds like a reach. a popular guy in their strongest markets. may have brought more team n. you have to see dig sent -- >> i got to go. sorry. the bear case wins. 61% to 31%. pete a quick, quick comment? >> i'm a bear all the way. with joe on this one. sorry, jon. i don't know how they hit this thing, this ship turned. i don't see it. >> that's the story. we mentioned at the ton of our program today we are still waiting for the president to emerge to make a statement expected, we think, to discuss the situation in iraq and the continuing developments out of ferguson, missouri. we expect to hear from the president later this hour. we'll bring you those comments live from martha's vineyard. coming up, why a longtime bull is turning bearish and

selling off 70% of his stock exposure. find out where he's putting that money now. also, as european data continues to frustrate investors, what american companies are at risk from that weakness? we're going to scour the data to show you all the names you need to watch. plus, new ceos, electric cars and health care. unvealing market movers not on your radar but should be. all that and more, next. a card that gave you that "i'm 16 and just got my first car" feeling. presenting the buypower card from capital one. redeem earnings toward part or even all of a new chevrolet, buick, gmc or cadillac - with no limits. so every time you use it, you're not just shopping for goods. you're shopping for something great. learn more at buypowercard.com

we are doing whale watching now. dominic chu, aren't we? involves -- >> four time as year. every quarter. the biggest money managers in america have to disclose what they own. long positions. this time we got hedge fund activist hedge fund dan loegens, third point lmplt lc. we want to highlight first, big additions, subtractions, deletions. first with allied financial. one that's a huge stake now for dan logan third point. stake worth about $1.1 billion. billion with a b. huge stake. ally financial. new from the previous quarter, although we have heard about that kind of allied financial

situation with dan -- rumblings at least in the past. highlighting, international paper, google, verizon and citigroup. they're no longer part of the portfolio at thirddissolved all. no nor international paper, google, verizon or citigroup. although they did increase stakes in dow chemical by about 14.5 million shares. a decent sized bump up in stake in dow chemical and bumped up stakes in dollar general and hertz as well. and i will say that they have a new position, a notable one, in drugmaker astrazeneca. azn, the target, remember, of a possible takeover by pfizer earlier this year. interesting news coming out from dan lowe. big stake, a billion dollar plus stake and a news stake in astrazeneca getting out of citigroup, google, verizon and international paper. >> as of the end of june? >> the end of june. remember, these have a deadline

of 45 days after each quarter. this is stale data. so to speak. no saying whether or not these guys are still in it or not. it's just a way to kind of get a little bit of a glimpse into what these guys own as a certain point in time. a balance sheet, if you will, not an income statement. back to you. >> all right. well said. dom, thanks. what do you think of some of these new positions or sold out positions? >> great obviously movement out of, look at search space, taking a lot of money off the table, google. a little surprised they're jumping out of citi because of the potential of the second half of the year of that stock going to the upside. >> what about like most, tired of watching the banks sit there like paint drying? >> i don't disagree. talk about it all the time. asked the other day when i was on here what do you think of financials? i said i think better places to be now. >> anything that stinks and hasn't done well has potential. >> i don't know if i would have exited the position but don't understand why necessarily he got out of the entire position. surprised by that. it dow chemical, talk about them

all the time. that's the area. specialty chemical, killing it and plenty of upside, whether dow, due ponte, go through the entire, eastman chemical, all up -- >> positions in dollar general, joe, interesting, considering dollar tree and the deal there. with family dollar. >> right. >> that's interesting. what catches your eye? >> not completely out of financials. he has a large stake in allied financials. international paper, this is truly where i hear a lot of commentary lately about alternative investing. that's not the place for investors to be. this is how you get access to gentlemen like dan loeb. invest with the hedge funds. international paper was a huge win for the hedge fund community, for dan himself, larry's brother, jeff altman, in that many, many years. that's a great win there. cabot oil and gas, noticed he existed that stake. that's interesting to me on the energy side that he's out of that. >> doc. >> a name on the list one of our

stocks today that has unusual activity, judge. i'll hold off on that. a dan loeb pick. >> like the tease. okay. back to today's market with a look at three things that might not be on your radar. that's right now. who's up first? joe? >> health care. 100%. i myself, i'll be the first to raise my hand. >> health scare sector year to date, leading up 11%. >> raise my hand. under invested in the space. a favorite of pete. i'm looking at it in terms of that little portfolio we have, my own personal portfolios. names i like, abbott labs, amgen. mckesson. pki. clearly health care gives you a little bit of the insulation against a lot of these global geopolitical events we're experiencing. it's a place i think you've got to be looking now. >> doc? >> plug power is one for me, judge. the stock's up 45% in the last month. of course, they supply power for the likes of fork lifts and that

sort of thing. on-site poub power, but up nearly 300% year to date. from 230 million to a billion dollars, or thereabouts over the course of this year. >> momentum stock. >> a big momentum play here, and i've been in and out of this name this year. happy to be in it now. >> pete? >> i think a lot of people just continue to see some of these names but they don't come up. not exciting. hewlett-packard. the run, very exciting. it continues. meg whitman, talk two areas. microsoft, new management there. obviously, meg stepped in a couple years ago. look at the transition she's been able to make so far. two names. laser focused and areas of growth, so is hewlett-packard, willing to make tough decisions. why they're trading well and why microsocht is at multiyear highs now. nice move, a lot left in both of these stocks to the up side. >> top of the show talked about europe. it's continuing to release

disappointing data. at what point did europe's weakness weigh on u.s. companies? seema mody tells us which s&p 500 companies are most at risk. >> scott, get this. over 80 s&p 500 companies generate 25% or more of their total sales in europe. analysts i spoke to this morning cautioned further deceleration could impact earning of these multi-nationals. what we did, looked at s&p 500 companies that generate a big chunk of sales in europe. what we found. first up, coca-cola enterprises. analysts i spoke to, further weakness the eu could pressure prices. something to watch for. knewmont mining. 60% of sales come from europe. gold is up about 7% this year and that's being seen as a boom for gold miners. able to yaufr set weakness in europe. moving on. priceline. over half of their sales come from the eu and online travel player benefitting from a pickup in booking from customers in

europe. another big one is, in europe, philip morris, actually saw a rebound in european seams this yaur. up about 8.5%. for some of the multi-nationals, scott, europe is has bright responsibility. experts say they could change if data out of europe continues to disappoint. >> okay. seema, thank you so much. joe? real issue. the market as a whole seems to be looking beyond europe for the moment. if more companies here, that people are investing in, seem to be developing more troubles as a result of what's taking place there, you've got to pay attention? >> you have to pay attention. and you also have to take advantage of the potential opportunity. because the ecb is going to be there, be there, go all-out, you asked muhammad alleren before. companies sold off now i don't think you should dismiss. names like bmw. adidas. >> adidas. >> okay. names like that. i think you should look at.

maybe the financials in europe isn't a place to be. i think europe is still okay. >> pete, laughing. i don't have time. >> i got stuff in my head. always laughing. >> look at natural gas. >> should we have you see a doctor jthts you don't want to know. >> boost on today's inventory numbers. jackie deangelis. >> good afternoon. the department of energy out w its report. a bullish report came in way storage build under expectations and saw a nice intraday pop for net gas over 2% the last time i checked. brian stutland, watching this report closely. what happened? what was interesting? >> what's coming to mind for traders, look at storage supplies. about 17% lower than a year ago. actually about one-third lower than we were off the highs in storage in the lower 48 states. certainly starting to become a concern, because if we don't get storage build we're basically going to have a tight supply situation where we get any sort of cold weather or changes here in the demand structure in that

gas, you could see nat gas move higher. >> talking about winter expecting another cold one. that's the variable here. jeff killberg, curious for your take on prices. the highs we saw in february. do you think we get back there come winter this year? >> i think we go lower before higher. push back. the two reasons why we saw a sharp decline in july. vast supply. the e -- marp salas shale, 15 billion cubic feet in one day pap new record. first time of that production. coupled with the weather. so mild here. normally the killberg household, we have the ac so low it rivals the gibson steakhouse meat locker. now it seems like the next couple of months, very mild weather. watch 374 on the chart, jackie. technically a great support level. we break that, go lower. right now seems like it wants to hug $4. >> all right. remind me never to come to your

house. i'm not into the whole meat locker thing. for more on futures, tune into the online show at the top of the hour. speaking to bank of america's mcneil curry, who this the chart looks like the s&p is topping out. he'll tell us why. 1:00 p.m., scott. >> jacky, funny he says that. a guest is coming up hoop i think will say a similar thing. see you in a bit. joe on nat gas? quickly? >> nat gas, something that when you look forward, it's tremendous opportunity. makes like range resources sold off. you buy those. gat emps certainly a source here. i think when you look in europe, the risk to europe is that the russians cut off the gas to europe. >> okay. coming up, jon najarian is more than just a master of the market. so what does dr. j do when not trading? we'll find out in today's "trader trade-off." also, bullish two years now. a trader with $3.5 billion under management has take an hard turn

away from the s&p. where is he moving a large chunk of his money? that story is next. ♪ when the world moves, futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with paper money to test-drive the market. all on thinkorswim from td ameritrade.

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we hope you'll join us at the top of the hour on "power lunch." italy back in a recession. will europe potentially pull down the u.s. stock market? join the conversation. go to cnbc.com/vote to tell us how you think about it. "consumer reports" hanging up on amazon's firephone, cr smartphone reviewers telling us why he can't recommend it. and the fastest sedan on the road goes more than 2 hrn mi00 miles per hour. meet the new super family car for the average joe. now back to scott on "fast money/half time report." >> see you in a bit. our next guest, a bull for more than two years. check the sharts. mike harris, president of campbell and company. good to see you. >> you as well. >> you say the equity rally may be coming to an end. to many looks like we're

climbing the wall of worry. what's changed? >> look at technicals, it's clear. focusing in on the last 30 days where our systematic models have taken off about 70% of long global equity exposure and a lot of macro reasons. fighting three wars in the world. weakness in europe, jitters around emerging markets. notice took the ice bucket challenge yesterday. it's possible this rally actually had cold water dumped ltz on it 30 days ago. you see the aggressive move down. we have challenged a long-term support line. i think that's -- >> couldn't you make the argument in past down turn, the down turn here, right? stocks rebounded. another down turn, stocks able -- looking at yields. talk to me about the stock market first. any time a down turn it's been a buying opportunity for investors. >> sure. >> you think this time is different? >> go back to the chart and here we are. you can see certainly, we have bounced off that trend line before.

>> down, up. down, back up. almost new highs again. >> that's the primary reason for a systematic approach. models are effectively looking at a weaker trend. why it's taking risk off. we're long in the equity markets. talked about geography early on in the show. it's important. long the s&p in the asian indices net short the european markets. that's part of driving our total long global stock lower. >> taken 70% of exposure off u.s. equities, where are you putting the money? under the mattress? >> that's the key. systematic models are loading up exposure on long global bonds. whether japanese government bonds, bunds, saw the ten-year yield, south of 1%. u.s., ten year yield. long bonds, short the yield, see a beautiful trend coming down and keep taking out of support. 248, gone, 240, gone as well. looking at really 230. the next big level. the high back in 2011 and 2012. and as you know, once we go

through the highs that becomes support. >> a bubble in bonds? >> i don't think there's a bubble. remember, we're active traders. at the end of the day, when interest rates go higher we can shift to a short position and be a hedge to our clients' portfolios. >> guys, what do you think of what mike has said? >> hits 230, do you expect -- is that a level then where you'd all of a sudden change if it can bounce off that, the actual direction moves to the up side for the yield? >> no. continue to xi a down trend. through 230, possible we make a stronger move towards 2%, obviously an absolutely huge level. from a long-term perspective, continuing to see yields fall. so being long bonds, the right trade in our minds. >> good to see you again. longtime friend of the show. good to have you back. >> interesting what mike is talking about. something that sooner or later will happen. the divergence between equities and bond. there seems to be the correlation in terms of performance. gone on four years and sooner or later has to crack. i don't disagree with anything

that mike is saying. if yields go lower, 230, signaling something. probably a little more ominous for the economy globally. >> interesting, joe. when you took some of your exposure down, you didn't up your exposure into fixed income. you added the cash. said it was maybe a little too early. it's been a tough trade to manage. right? i mean, every time there's been a risk building up, it's reversed just as soon as everybody gets so pessimistic. >> yeah. i would agree with that. probably one of the better things i did amonth ago, give up on the notion that yields here in the u.s. would rise. the bet i had made. gave up on it quickly. that's actually worked out. being in so much cash has not worked out well. and i think in the second part here of august, we're beginning to see a little bit of that potential pain that you sigyou looking at risk, elevating and taking exposure off quickly. it's happening right now i

think. >> pete, your opinion as well and take note, and remind all of you as well that we are waiting for president obama to make that statement on what we think is about iraq and the situation in ferguson, missouri, from martha's vineyard. pete, may have to jump in and interrupt you to go to the president in a moment, but what are your thoughts on this topic? >> you're talking about yields still. it's been an interesting trade, scott. you know, quite frankly. i'm always focused on equity markets and look at opportunities presented as we get to some of these shifts. the ups and down. just the other day, scott, we all talked about it on the show. unusual activity. the transports. everybody looks for the transports's. >> interrupt you. go to the president right now, live. -- i've been monitoring closely the last couple of days. first of all, we continue to make progress in carrying out our targeted military operations in iraq. last week i authorized two limited missions. protecting our people and facilities inside of iraq, and a humanitarian operation to help

save thousands of iraqi civilians stranded on a mountain. a week ago we assessed that many thousands of yazidi men, women and children abandoned their positions to take refuge on mount sinjar in a desperate sin attempt to avoid slaughter. we also knew that isil terrorists were killing and slaying yazdis. without food or water, they faced a terrible choice, starve on the mountain or be slaughtered on the ground. that's when america came to help. over the last week, the u.s. military conducted humanitarian air drops every night, delivering more than 114,000 meals and 35,000 gallons of fresh water. we were joined in that effort by the united kingdom and other allies pledged their support. our military was able to successfully strike isil targets around the mountain, which improved conditions for

civilians to evacuate the mountain safely. yesterday a small team of americans, military and civilian, completed their review of the conditions on the mountain. they found that food and water had been reaching those in need and that thousands of people have been evacuating safely each and every night. the civilians who remain continue to leave aided by kurdish forces and yazdis helping to facilitate the safe passage of their families. so the bottom line is that the situation on the mountain has greatly improved and americans should be very proud of our efforts because the skill and professionalism of our military and the generosity of our people. we broke the isil siege of mount sinjar. we helped vulnerable people reach safety and we helped save many innocent lives. because of these efforts, we do not expect there to be an additional operation to evacuate people off the mountain and it's unlikely that we're going to need to continue humanitarian

air drops on the mountain. the majority of the military personnel who conducted the assessment will be leaving iraq in the coming days. and i just want to say that as commander in chief, i could not be prouder of the men and women of our military who carried out this humanitarian operation almost flawlessly. i'm very grateful to them and i know those who are trapped on that mountain are extraordinarily grateful as well. now, the situation remains dire for iraqis subject to isil's terror throughout the country. and this includes minorities like yazdis and iraqi christians. it also includes many sunnis, shia and kurds. we're going to be working with our international partners to provide humanitarian assistance to those who are suffering in northern iraq wherever we have capabilities and we can carry out effective missions like the one we carried out on mount sinjar without committing combat troops on the ground.

we obviously feel a great urge to provide some humanitarian relief to the situation. and i've been very encouraged by the interest of our international partners in helping on these kinds of efforts as well. we will continue air-strikes to protect our people and facilities in iraq. we have increased the delivery of military assistance to iraqi and kurdish forces fighting isil on the front lines. and perhaps most importantly, we are urging iraqis to come together to turn the tide against isil, above all by seizing the enormous opportunity of forming a new inclues uv government under the leadership of prime minister designate abadi. i had a chance to speak to prime minister designate abadi a few days ago and he spoke about the need for the kind of inclusive government, a government that speaks to all the people of iraq that is needed right now. he still has a challenging task

in putting a government together. but we are modestly hopeful that the iraqi government situation is moving in the right direction. now, second, i want to address something that's been in the news over the last couple of days. that's the situation in ferguson, missouri. i know many americans have been deeply disturbed by the images we've seen in the heartland of our country as police have clashed with people protesting. today i'd like us all to take a step back and think about how we're going to be moving forward. this morning, i received a thorough update on the situation from attorney general eric holder who's been following and been in communication with his team. i've already tasked the department of justice and the fbi to independently investigate the death of michael brown along with local officials on the ground. the department of justice is also consulting with local authorities about ways that they can maintain public safety without restricting the right of peaceful protest and while

avoiding unnecessary escalation. i made clear to the attorney general that we should do what is necessary to help determine exactly what happened and to see that justice is done. i also just spoke with governor jay nixon of missouri. i expressed my concern over the violent turn that events have taken on the ground and underscored that now's the time for all of us to reflect on what's happened and to find a way to come together going forward. he is going to be traveling to ferguson. he is a good man and a fine governor. and i'm confident that working together, he's going to be able to communicate his desire to make sure that justice is done and his desire to make sure that public safety is maintained in an appropriate way. of course, it's important to remember how this started. we lost a young man, michael brown, in heartbreaking and tragic circumstances. he was 18 years old.

his family with will never hold michael in their arms again. and when something like this happens, the local authorities, including the police, have the responsibility to be open and transparent about how they are investigating that death and how they are protecting the people in their communities. there is never an excuse for violence against police or for those who would use this tragedy as a cover for vandalism or looting. there's also no excuse for police to use excessive force against peaceful protests. or to throw protesters in jail for lawfully exercising their first amendment rights. and here in the united states of america, police should not be bullying or arresting journalists who are just trying to do their jobs and report to the american people on what they see on the ground. put simply, we all need to hold ourselves to a high standard, particularly those of us in positions of authority. i know that emotions are raw right now in ferguson and there

are certainly passionate differences about what has happened. there are going to be different accounts of how this tragedy occurred. there are going to be differences in terms of what needs to happen going forward. that's part of our democracy. but let's remember that we're all part of one american family. we are united in common values and that includes belief in equality under the law, a basic respect for public order and the right to peaceful public protest, a reverence for the dignity of every single man, woman and child among us and the need for accountability when it comes to our government. so now's the time for healing. now's the time for peace and calm on the streets of ferguson. now's the time for an open and transparent process to see that justice is done. and i've asked that the attorney general and the u.s. attorney on the scene continue to work with local officials to move that

process forward. they will be reporting to me in the coming days about what's being done to make sure that happens. thanks very much, everybody. >> that was the president there, as you see, up in edgartown, massachusetts, making statements on two stories that have been dominating the news flow of late, certainly the situation that continues to develop in iraq and then also in ferguson, missouri. let's bring in hampton pearson who's in our washington bureau. to the latter first, the situation in ferguson has really presented the white house a somewhat difficult challenge on trying to figure out what the appropriate response to what we've all been seeing on our television screens should be. >> you heard the president try to strike that balance in the statement he made where on the one hand saying there is never

any real excuse for violence against police but statement some of his strongest words were calling for restraint on the part of the authorities in ferguson, missouri, just north of st. louis. basically saying there should be restraint, respecting the rights of people to peacefully protest. obviously a very volatile situation there and also respect for members of the news media, essentially trying to do their jobs and cover the story. he did say going forward, he called for calm, but at the same time a very transparent process in the investigation going forward. that's been a thorn in the side of people in the community there because, among other things, the authorities have not released the name of the police officer who did shoot 18-year-old michael brown. that's been one of the things that's been somewhat fueling some of the community unrest in that community and then again shifting gears very quickly back to the president's news about the situation in iraq.

at the top of his statement, good news on the humanitarian front. still problems with the iraqi government going forward. back to you. >> we don't expect to need additional operations in iraq, those the words from the president. hampton, thanks so much. "power lunch" picks up the story now. "power lunch" and the second half of the trading day start right now. >> thank you very much, scott. we are going to focus on europe in part this hour. will europe's problems become our own? what will weak production in the countries that make up the backbone of the european economy mean here for you as an investor in the u.s.? plus, exposed. reporting on u.s. companies with the biggest connections to those troubled eurozone countries. and retail wreck, another one bites the dust. how much trouble is retail in? we are going to zero in on the latest victim of weakness in the retail world.