brent cruelde up almost half a percent. three big losers here, with vertex leading the way down. ty, up to you. that will do it for this edition of "power lunch" for a monday. thanks so much for watching. >> see you tomorrow. "street signs" begins right now. iraq flares up are world energy markets about to become unhinged? our first guest says, yeah, they might be. plus the statistic about health care in america that may make you feel ill. and the real estate related stock you probably never heard of that one big bank says has big-time up side. the s&p you can see here is pretty much flatlining. what it's actually doing is

trying to avoid a fourth loss in five sessions. . you do the math. so what is doing well today? yeah, the utilities have been real great this we're. >> mand where laid it out for you, folks. investors are trying to understand the global implications. the situation deteriorating as i.s.i.s. pushes towards baghdad. let's get to michelle caruso-cabrera, who is live for you in northern iraq with the very latest. michelle, number one, i hope you're safe. >> we are safe here in kurdistan. they have a strong military here, and as a result there's more -- it was a bit of good news and bad news for the iraqi government.

the bad news was yet another town has fallen to the islamic insurgents, a town called tal afar. at the same time insurgents were not able to take baghdad as many thought they could do late last week. at the same time the iraqi government is wage waging a pr war. is the iraqi air force released footage to the associated press yesterday, which they squlams shows air strikes being carried out against i.s.i. circumstances and their hideouts. and it shows various buildings, vehicles and people being hit by explosives. satellite coordinates on the video suggest the attacks near the town of ishaki, which is near tal affair. here in kurdistan, which is in the northeast of iraq and what's

called a semiautonomous state, the iraqi army is still big vilified. kurdistan has its own military, and they stepped in last week in nearby kirkuk, and held their ground when the iraqi military fell. >> to control the economy, they want to control the energy, they want to control the security, then why should we be part of a country one does not -- when that country doesn't treat you equally? >> reporter: in addition to what he said, he was also deeply critical of the iraqi army, which has receive so much funding and guidance, but has -- but the peshmerga here in kurdistan has not. ladies and gentlemen, back to you. >> michelle, thank you very much. so are we ought an energy tipping point here? let's bring in david nelson,

chief strategist and arriva vala. david, your note this morning caught our attention. thank you for coming on. you thought in your words, the energy markets could become unhinged. >> i think we're seeing the early signs. iraq is not the only troubled spot in the world. in ukraine, russia has already shut off the gas supplies there. that could hit 15% of the natural gas supplies for europe, and don't forget china is showing their increasing military might in the seas. so in the end, all of this is about oil and it's conspiring to drive energy prices here and everywhere around the world higher. that's bad news for our economy. >> and bad news for the world economy, isn't it? >> it's a disaster, especially when you have -- you know, mandy, the only thing i can think of that's worse than a radical islamic state is a well-financed one. this one seems to be well financed. >> riva, what scenarios are you

seeing here in what's the most likely scenario? >> i think there's nuance to that analysis. in iraq in particular you're not going to see production or exports, experience a serious shock, until you sigh something happen in the south. we still consider that as far less likely. right now you're seeing a lot of that militant activity concentrated in the sunni band, in particular where you have a lot of infrastructure that supplies the domestic market. farce production of exports, you won't see that much of an impact. >> reva, how did thisened? >> in iraq it's not going to see an end for a while. iran has all the interests in the world to make sure that baghdad maintains its forces and ability to check the advance, and they will. we've already seen the mobilization of shia militias. at the long term, that come -- that is the cost that iran is willing to pay, but you're going to see a lot of volatility.

again it's all about the southern exports that matters. >> and militarily, how is it that a group of 2,000 to 3,000 men max are able to take over a city of 2 million? >> here's the interesting thing. they wouldn't have been able to go this far if it hadn't been for the local sunni support they're getting from associated groups. a lot of attention has been placed on isis, but there are other groups working with them. and many of those groups do have ties that go back to saudi arabia. you can bet that the saudis are sitting very happily watching iran on the defense i have been. >> so it's interesting, what reva is saying unless we see a push down to the south and it disrupts into infrastructure energy exports, she doesn't seen a -- >> we're okay for now, but if baghdad falls, they will go to the south and that would be a problem. here in the united states, i think the debate that will carry on both in washington and here at home, as the united states pulled back, a lot of bad things are starting to happen.

if that's the path for america, we better have a plan b. and plan b has to be energy independence in this country, and i mean are. >> but before we get to the plan b, what are you doing in terms of a plan a? are you -- >> i'm in the sitting still, no. i think most investors came into the year underweight in energy stocks, wee just about above market rate. we have to increase that. >> are you doing anything for transportation stocks? that has a significant -- >> transportation -- you've got to question my commitment to airlines at this point. goldman did a great piece last week. they said a 1% lies in centering prices could be a -- an almost 3% hit to earnings, 10% higher in energy. that could be 29% in eps cuts across the energy sector. that's at all-time highs. >> i hear you, but reva, i know you're 23409 a strategist, but i want to show this chart, and

actually despite what everything says, oil and stocks have tended to go up or down at the same time. they have not traded, so if oil goes up, history says stocks may also be able to go up unless this time is really different. david, i know you're chomping at the bit, but stj time different and worse? >> for the energy markets? no, i don't think you'll see that big of a shock. we're still saying in that is 13 barrel range. that isn't that big of a difference. most of that risk from the middle east has been priced in, and again, you're not going to see that major supply disruption that's going to impact the market. >> david, you're shaking your head. >> this is the way it starts. it always starts off slow, but i assure you at $150 oil that will affect our economy. think about it, oil touches every fabric of the economy, not just the consumer. it hits transportation, it hits industry, and eventually that gets translated to the consumer. >> you're saying be prepared?

>> be prepared. reva, i don't want to use the word allied, better i don't know what else to say, with iran? these are strange bedfellows. >> july 20th is a dead livan. there is a very deep and broader developing between the iran and the united states. certainly this is another layer of cooperation between the two. >> it's a real pleasure, a good discussion, not one that's over. >> thank you. we'll get larry kudlow's take, plus his thoughts on the economy overall. >> plus why every nation's equity market should be dreading a world cup win. "street signs" will be right back. at is heads above the competition, but we're not in the business of naming names. the fact is, it comes standard with an engine that's been called the benchmark of its class. really, guys, i thought... it also has more rear legroom than other midsize sedans. and the volkswagen passat has a lower starting price than...

much better. vo: hurry in and get 0% apr for 60 months on 2014 passat gasoline models plus a $1000 contract bonus. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies.

as you can tell it's a very busy monday. a lot to keep the market on its toes. who better to bring in than our own contributor larry kudlow. larry, all those things and other stuff. what are you focused on right now? >> you know, it's funny. i'm more focused on the economy, probably because i don't understand this iraq story. i want to come back to it with regard to oil, but let me make this point. i do not see a recession for quite some time. abbess it the economy will expand slowly, subpar, for several years, and i say that in

a timely way, i hope, because of the fed meeting today. the fed is signaling, we are not going to a 4% target rate, whether it's a reverse rp or what you have they use. we won't go to a normal target rate. i think in a medium growing economy, that is correct. so here's my thought. just a simple thought. you dpra el or disagree. in the next two years, ten-year bond rates go to 3.5 to 4, that's roughly the growth in gnome nat gdp, and the short-term rate goes to about two. bottom line -- we've never had a -- without an inverted yield curve. i think the fed will consciously stay away from such a thing and consequently the economy will continue to expand. the stock market grinds higher, with occasional correction. >> what's the black swan? what do you think is the biggest risk? >> you know, i think -- >> if not iraq. >> it could be.

if 9 old fields in basra are taken over by the enemy. i don't believe that will happen. i don't think the iranians will let that happen. i don't think the united states will let that happen. i don't think that nato will let that happen. $150 oil, you've got problem. whether that's recession, i don't know, but you have a big problem. you could say to me, what about inflation, all this money has been printed. i would say the real money supply is not really growing, i don't see an inflation problem at all. what i'm saying, show me an inverted kiffin, the 23rd five times tighter, i'll show you a recession, i don't see it. >> honorable sir, i will disagree. about oil, but also to your point. we have had inverted curves and not had a recession. your point is -- >> when? when? >> yes, yes, but every inverted curve hasn't met we've had a

recession. every recession has had an inverted curve. there have been other times. >> i can't remember. may post-war 1945, '46. >> i'm sure our smart ought yen will let me know if i'm wrong. let's go to energy, though. yes, oil prices are higher and they do damage. however, the stock market and oil have trade indeed tandem the last five or ten years. i get your point, but i also remind our audience we were at inflation adjusted 40 a barrel ten years ago, so effectively got un250%, so yet stocks have gone up also. >> there was a very positive correlation between oil commodities and the stock market, as we move from deep recession for at least modest recovery s i think that relationship is starting to break down. regarding oil, it depends how long. a spike to 150, if 078 a week or

two means nothing. >> that's $6, $7 gas. it filters through the gas lien price which affects consumer spending. it also affects business investment. that industrial number today was a good number. look, we're going to make a deal with iran? i find that extremely hard to believe. >> maybe it's the silver lining, maybe it will mean a thaw of relationship between the u.s. and iran. if there's a cooperation, maybe that might be the silver lining. >> with all due respect, my view, you can't trust them a nickel's worth at any time. what's missing here -- i don't know why this is missing. where is nato? we put a big warship fleet, okay, back in the persian gulf. where is nato here? nato is very important. you know why nato is important? the turks are getting involved the. the turks lost a lot of people

in mosul. they don't like that one bit. we need to get nato involved before we start making concessions to iran. however, aren't the kurds protecting the kirkuk oil up north? >> they're going to try. and mosul -- >> the word i read is they have troops around the big oil fields. >> right. >> up north and down south. >> at all costs trying to protect the fields. >> so we're see how this plays out. the bad guys are the bad guys. this has been coming on for aye some time. i don't think it's just shia versus sunni. i think it's a radical extremist group that wants the caliphate from syria through iraq. i think nato has got to do something about it. troops on the ground, i don't know. bombing? i think that should have been on the table a long time ago. we've got to be very, very tough. i wouldn't trust iran a penny's worth on any subject under the

sun, but i would trust nato and the usa, and i don't see a recession coming. >> on that note, larry, always good to talk with you. >> appreciate it. a device that basically makes every diabetes treatment that we have now obsolete. a potential game changer in the fight. plus one of the single best investments you can make if you can afford it. the price of entry extremely high, but we'll tell you what it is and why common wisdom about it may be wrong. that's coming up. ♪ ♪ over 1.2 billion eyeballs are on us during the two weeks at wimbledon.

true tennis fans want to know what's happening, they don't want to just see what's happening, they want to know and understand why it's happening. anybody can just put data up, but we want to get a reaction, make it far more interactive. we rely on the cloud to provide that immersive digital capability. ♪ "first day of my life" by bright eyes ♪ you're not just looking for a house. you're looking for a place for your life to happen.

♪ ♪ ♪ [ male announcer ] if you can't stand the heat, get off the test track. get the mercedes-benz you've been burning for at the summer event, going on now at your authorized mercedes-benz dealer. hurry, before this opportunity

cools off. ♪ mayo? corn dogs? you are so outta here! aah! [ female announcer ] the complete balanced nutrition of great-tasting ensure. 24 vitamins and minerals, antioxidants, and 9 grams of protein. [ bottle ] ensure®. nutrition in charge™. a mobile control process could be a major game changer in the fight against type 1 diabetes and also a massive money maker. a bionic pancreas that uses a smartphone, glue comonitor and insulin pump is showing success.

both adults and teens were included in the tests, and the people who used this device said it was like a dream come true. about 6 million americas have type 1 dibets. i think we all know somebody who has diabetes. you obvious have to inject yourself as well, and quite onerous, but this is a wearable device and controls everything. people who wear it apparently say it just makes you feel so much better, because it's monitoring your blood sugar levels all the way through the day. >> it could be big news for a lot of people. staying with health care medtronic cake off its high, investors adjusting the bid for eye require-based mel device maker ko covidien. that aside, let's talk more about it.

you cover covidien. the stock is not at the purchase price. if you own it, what do they do? do nothing? >> i think the transaction makes sense and i think the combined company makes a lot of sense. we think it's a win-win for both medtronic as well as covidien shareholders. medtronic has taken $14 bill chron of cash on their balance sheet, which is essentially using close to nothing and investing it in a company which has a yield of close to 6%. initial, there is substantial tax savings that come with this transaction. essentially through -- there's a valuation of about $8 billion attached to just the tax saving component of this transaction, and beyond that, we see cost synergies, which manage has indicated at 850 billion for

now, which is just their initial estimate, and they have not even yet called out the revenue synergying, which can be substantial given the cross-selling opportunities. >> the -- that you took after this, is you were consulting your rating to fair value, but increased your price target. >> right. we obviously expect the stock to move up from an $82 price target, and we have the highest priced target on the street, very positive on the name, giving the access to free cash flow story that covidien has, so we've up -- basically increased our price target to 93.22. >> that's where the deal is. unless you think the deal is not going to happen, you have to raise your price target, but the stock is at 87.10. so what's wrong? the market is saying this might be risk to this deal? no?

>> i don't believe so. its think it's a win-win for both. so let's talk it it from a covidien shareholders standpoint you know, just in terms of the tax savings that they're offering to medtronic, as well as a little bit more in terms of the cost synergies, as well as the revenue synergies that have not yetting called out. so our case is between 90 and about $93, and i think, you know, they're offering 93.22. >> just very quickly, what do you make of statements like this, essentially they're doing this deal, because there's a complementary strategy, to make them invest more, as opposed to just the tax considerations? how great were the tax considerations, in reality?

>> in reality, we think about 85% or more of the value of the transaction is predicated on the tax synergies. if you think about it, profits generated outside the u.s., they have to be -- when they're repatriated back to the u.s., they have to be taxed as a much higher tax rate. the tax saving of that alone, again, is about $8 billion. about 85% of the value. so i think tax inversion was the number one reason for the deal, and it comes with additional synergies. >> got it. >> a real pleasure. come back on anytime soon, okay? though we're going to run out of the companies with medical devices that are still independent. we'll have to move a ireland. >> back to being with your people. would they welcome you back? >> no, they would not. a red-hot stock that is tefloned. it's wicked away all opponents. plus forget kick stands.

college students will be double-pounding frappuccinos. "street signs" will be right back. we're moving our company to new york state. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york.

[ male announcer ] see if your business qualifies.

become the next business to discover the new new york. could help your business didavoid hours of delaynd test caused by slow internet from the phone company? that's enough time to record a memo. idea for sales giveaway. return a call. sign a contract. pick a tie. take a break with mr. duck. practice up for the business trip. fly to florida. win an award. close a deal. hire an intern. and still have time to spare. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business. built for business.

first off, this is the real estate firm we teased at the top of the show. its co-star group, initiated a buy at bank of america merrill lynch. >> new york city-based real estate data firm, the target boosted for -- from 161, the stocks basically at 161 right now, so still sees about 21% more upz up side. they're done a bit today, but bamle very bullish on csgp. stock number two is gnc getting downgraded. >> and the stock is down 2.3%. they cut their rating on the unexpected resignation of the

company's cfo. on friday the cfo, also an executive vice president resigned sort of out of the blue. stock's down 40% over the past six months. the mean target of analysts 46.55, so either wall street has to start slicing their estimates, on this stock has in up side. and stock number three is williams companies, getting an upgrade to buy at jeffries. >> yeah, there's a deal here. so there's a deal here. basically a 6 billion deal to expand their pipeline, buys up a stake, access midstream partners i believe is the name. jeffries obviously loves the deal. the stock's at 56, already been a super hot stock. that chart is just out of control. >> i think it's at ahn all-time high, thanks to the crack work of our team. stock number four, this

network. >> stock ace up halfsh dish is at 59.25. they bumped the target on dish to 72 from 61. so the stock is nearly 61. they said, we see $$11 more of an up side. up 52%. and finally stock number five, not a -- until the radar name. i wouldn't -- it's ak steel, okay, definitely on our ray dash, getting an upgrade today. >> it's the best we can do. all right. donnell defeat the tease. it was upgraded for three reasons. better electrical steel demand, falling iron other costs in the-second half, and improving free cash flow store at the end of next year. price target raised from to 10, which actually implied about 35% more up side -- i know, ten bucks doesn't sound like a lot, but -- >> and also shares of nuanced

communications shooting higher today. with samsung and private equity firms. let's bring in herb greenberg. >> you are not now juansed on the name. it's not green, it's not red, it's yellow, so what's your take on all of this? >> i'm keeping it at yellow flag on reality check, because this is a risk call. without a deal, you would argument that the performance at nuance, which has just been substandard, would continue to misperform. i think what you have, though, is very interesting. private equity seems logical. remember, carl icahn got into this company back in april of last year, and started buying more since then. the stocks and performance of the company continue toss go down, but it's interesting, when you hear private equities make sense, samsung and people used

to speculate a loening time ago, apple would make interesting sense. if they want to do wound the other, or get another leg up on the other, you have to understand, nuance is the voice recognition technology behind, you know, that both of them use. samsung certainly using it in the tvs, apple uses it behind siri and its phones. microsoft and google have their own technology build in. you can see how this hole thing can go, but that said. without at deal it's back -- which had organic growth that is been negative for the past five straight quarters. >> is that because voice recognition is on every phone already, if you have a smartphone? let me excel it a different way. would a huge new product cycle change your view on the name? >> no. because it's a commodity that's already -- the manufacturers, we're really talking apple is the big manufacturer here. you know, really driving down

costs, keeping it down. i think that you have to look at it from the perspective of, you know, yes, it's already there. the big story, by the way, if you were to talk to nuance, what they would say, that i'm not telling, they have this other business that's recurring revenue. so i'm telling you they have this other business the that's what private equity would want to look at. by the way, remember, this is a roll-up, lots of acquisitions, lots of goodwill, lots of tangled financials that any buyer would have to dig into and make sure they're comfortable with. >> good to talk with you, herb. >> that was a double, by the way. >> it was. by the way -- he by the way'd the by the way. that's deep. today we're talking underarmour in the past month up 25%, crushing the competition include nike. let es bring in aaron gibb and jonathan krinsky. jonathan, i want to start with you, a stock that's been this

hot for a year plus, any sign of it breaking down or slowing down? >> not in the long run. we're in the middle of the world cup. we could see it'sen the lionel messier of the -- it's about flat on the year. since the '09 lows, underarmour has been in this classic rising wedge pattern, gets to the top of the wedge, moving down, gets to the bottom and moves higher. recently we pulled back about 27% down to the march lows. if we look at the second chart. we can see where we're at. that pullback has this nice rounded base or a cup we think is in the midth of starting to form the handle. that's where you want to get long. you want to buy the pull democrat back, down towards the low 50s is a good entry, and then you willy that should take us to the top edge of that channel form so near term, a little cautious, but i think

there's more term in the long term. >> what about the fundamental side of all of this? erin? >> underarmour has some really high expectations. currently it's expecting about 25% eps growth. they achieved that last year, and they're looking for the same type of growth rate this year, but the problem is it's trading at about 62 times earnings versus its competitor, nike, as you mentioned, which tends to trade more around 25%, so there's a lot of this growth that's really built in. another thing about underarmour is that it is unusually volatile around earnings reports. we're expecting the report in about the fourth week of july. it sends to move 8% on the day of reporting, up or down, half the time down, and last time it was down 15% in the two weeks after it reported. so if they miss just the slightest bit, you're going to see a drop. so for me personally, we don't own this in invite portfolios i

advise on. i'm not looking to add it here by any means. if they do disappoint the next quarter, but we still see solid long-term growth, that might be a better entry point, but not right here. >> might be a perfect name to buy in options on, too. >> buy some options, product to add to that. interesting stats about the volatility there. >> erin and jonathan, thank you both. you can catch more "talking numbers". all right. kellie has a preview of what's coming up on "closing bell." >> we have a great, count jay fisher as those worried about the national debt. he produce add documentary called "overdraft" but since then the deficit have fallen. some like bill miller said it's not out of the question the u.s. could be running a surplus in the next couple years. we'll talk about that also the pretty impressive performance

that travelers has put up during his tenure. the imf making a bold move today by taking sides on a very hot button issue here in the united states. we'll have a first on cnbc with the man who is the main representative to the united states from the imf. plus why a world cup win could be a big sell signal. >> sell germany? tdd#: 1-800-345-2550 searching for trade ideas that spark your curiosity tdd#: 1-800-345-2550 can take you in many directions. tdd#: 1-800-345-2550 you read this. watch that. tdd#: 1-800-345-2550 you look for what's next. tdd#: 1-800-345-2550 at schwab, we can help turn inspiration into action tdd#: 1-800-345-2550 boost your trading iq with the help of tdd#: 1-800-345-2550 our live online workshops tdd#: 1-800-345-2550 like identifying market trends. tdd#: 1-800-345-2550 now, earn 300 commission-free online trades. call 1-888-628-2419 or go to schwab.com/trading to learn how. tdd#: 1-800-345-2550 sharpen your instincts with market insight from schwab tdd#: 1-800-345-2550 experts like liz ann sonders and randy frederick.

tdd#: 1-800-345-2550 get support and talk through your ideas with our tdd#: 1-800-345-2550 trading specialists. tdd#: 1-800-345-2550 all with no trade minimum. and only $8.95 a trade. tdd#: 1-800-345-2550 open an account and earn 300 commission-free online trades. call 1-888-628-2419 to learn more. tdd#: 1-800-345-2550 so you can take charge of your trading. ♪ [ girl ] my mom, she makes underwater fans that are powered by the moon. ♪ [ birds squawking ] my mom makes airplane engines that can talk. [ birds squawking ] ♪ my mom makes hospitals you can hold in your hand. ♪ my mom can print amazing things right from her computer.

[ whirring ] [ train whistle blows ] my mom makes trains that are friends with trees. [ train whistle blows ] ♪ my mom works at ge. ♪

the imf lowering its estimate, but maybe bigger is their firm stance on a hot button issue here in america. steve liesman joins us with a special guest. >> you don't see this every day. you might not -- well, maybe you do. the imf out with its annual resue of the economy and policy, taking a firm stance on the u.s. saying it should raise the minimum wage of a hot political button. joining us notice, from warble is nigel chock.

thank you for joining us. >> thank you, steve. >> what's behind in idea of supporting raising the minimum wage in the united states? are you concerned about wading into u.s. politics in this regard? >> we always have to be concerned about wading into politics, but the again any is coming from the fact we still see poverty rates at very high levels, and they're not coming down even though the economic recovery is going. 1 in of in the population, and we think this is a macroeconomically relevant issue. so we propose a package of policies to help address some of these poverty-related issues. in particular, a combination of a package of an increase in the earned income tax credit, a negative tax credit that the u.s. offers, as well as increase in minimum wage. and the relative trade we'll see

will be much smaller than a minimum wage of our own. >> you don't mention that in the report which i read, that there are reports that the united states would actually lose jobs. how do you respond to that? >> yes, certainly there is an employment trade-off. the congressional budget office, but at the same time they also note the 16 million people would have higher incomes as a result of a higher minimum wage. so definitely tradeoffs, but when we look at the u.s. from a historical perspective. it's much lower. when we look at the u.s. from an international perspective, the minimum wage is low relative to industrial country averages, the third lowest in the oecd, which is quite low relatively to the oecd average. >> earlier on today we were talking with david nelson, where he what he's seeing could

unhinge, and undermine economic stability worldwide. what do you see as the potential imbalance of world prices and therefore the economy. >> it's difficult to assess exactly how much it will affect. we've already seen an impact in the oil markets. that's the primary transmission mechanic temple by which it will affect the economy, but you have to see that increase sustained for quite a long period of time before it starts to eat into sbrout. we normally have roll tilt in oil prices,. >> so a sustained increase in oil prices would definitely start eating into u.s. growth. >> speaking of volatility, your growth this morning is full of concern about volatility in the u.s. markets regarding the outlooks. you're suggesting that the u.s. markets or u.s. pricing on certain products are way too complacent.

>> well, i think that's the tension we saw in discussing with private sector individuals and the government is there's a lot of uncertainly about what's happening in the u.s. economy, not least because of the first quarter results and the poor growth there, but also the labor market is uncertains, the degree torn that slack in the labor market will translate. so i think the fed is dealing with a very uncertainty context, and they've communicated repeatedly how difficult that judgment is. on the other hand, when you look at markets, you see markets that are pricing volatility, very low levels. credit spreads are very low, so that combination seems to us to be disjointed. when you have that kind of divorce from fundamentals, you have the potential of a significant reversal driven by relatively small market news. >> we have to leave it there, but thank you for joining us. >> thank you very much. >> thank as well to steve liesman. why are college kids ready to ditch the vodka shots for espresso shots? we'll have the answer with jane

wells. plus the one investment that is basically a guaranteed winner if you can afford it. coming up. you probably know xerox as the company that's all about printing. but did you know we also support hospitals using electronic health records for more than 30 million patients? or that our software helps over 20 million smartphone users remotely configure e-mail every month? or how about processing nearly $5 billion in electronic toll payments a year? in fact, today's xerox is working in surprising ways to help companies simplify the way work gets done and life gets lived. with xerox, you're ready for real business. and life gets lived. ♪ ♪

♪ [ male announcer ] if you can't stand the heat, get off the test track. get the mercedes-benz you've been burning for at the summer event, going on now at your authorized mercedes-benz dealer. hurry, before this opportunity cools off. ♪

that's why i always choose the fastest intern.r slow. the fastest printer. the fastest lunch. turkey club. the fastest pencil sharpener. the fastest elevator. the fastest speed dial. the fastest office plant. so why wouldn't i choose the fastest wifi? i would. switch to comcast business internet and get the fastest wifi included. comcast business. built for business. starbucks announcing today it will offer free online

college tuition to many of its employees. let's get to jane wells with more. jane? >> reporter: hey, mandy. the employees here are pretty happy about t. the concept at least. howard shultz is saying this is not a perform r stunt. it could however behowever, be . starbucks released a video talking about how most of its workers want to go to college but haven't been able to do. in a deal with arizona state's online degree program with 40 different programs, degrees which they say are just as valid as being on campus, starbucks will give a 100% reimbursement to the last two years of a bachelors degree if they're working 20 hours a week and partial aid to another degree for those who qualify for asu admission. this could end up costing tens of millions of dollars, potentially more, but schultz believe it's important for the company to balance profits with social conscience. >> this is perhaps one of the most, if not the most important

announcement we've made in our history. we're going to have to make some changes in order to administer it properly. i don't know exactly what that's going to be. i'm quite certain we're going to make some mistakes. i'm quite certain people are going to feel as if we don't have our stuff together. >> reporter: now, you can't qualify if you already have a bachelor's degree. you can't use the program for a master's program. schultz said many schools competed for this deal with starbucks but asu won out. and you don't have to stay at starbucks after you graduate. you owe them nothing. a "u.s. news & world report" on the 1,000 online university programs ranked central michigan and state university of new york's college of technology at the top. you see some of the others. asu ranks ninth. that's about 11,000 students just in its online student body. back to you. >> jane, thank you very much. let's continue our discussion on this interesting story with naomi schaffer-riley, author of "faculty lounges," and bill zimmerman, author of "the student loan swindle." naomi, i give howard schultz all

the credit in the world. he's a revolution leader, a great guy. they've done a lot for their employees. i find it interesting that this is with one school and they won't release the deal that was made. is this all good news? >> i think this is great news. first of all, i think it's great that employers are getting more involved in the world of higher education. for a long time, their needs have actually been ignored. and if you survey a lot of employers, they will say the students graduating from college are not ready for the job market. so, that's one thing. but i would say asu actually has a long tradition of being very entrepreneurial. their president, michael crow, has been involved in online education for a long time, and i think this is a very promising partnership. >> and does it also really -- i know online degrees have only grown in prominence -- does this almost solidify and put a big stamp of approval from a major corporation on online degrees, which, let's be fair, have maybe not necessarily had the same respect in the marketplace,

perhaps, as you know, physically attending? >> yeah, i think this is sort of a second big milestone this year. also, the university of wisconsin also this year decided to do an online degree program as well, and that is a very prominent, you know, very rigorous university. so, i think now it has the stamp of approval, both from the world of higher education, and from the world of employment, which i think is great for online education as well. >> yep. i also believe that as part of this deal, there is no indication that your studies were completed online. you receive the degree from the university. it doesn't say this is actually only an online degree, right? let's bring in bill. what do you think? do you think other companies will follow? but what are the broader implications, do you think? >> well, i applaud the decision, but this is a thimble full of solution in an ocean of problems. there are 40 million americans carrying student debt. the total is $1.2 trillion. that's too much to ever be repaid. these loans have to be

refinanced in the same way that housing debt is going to refinance. but congress is unwilling to do that. they're hopelessly gridlocked and too beholden to wall street. so, the borrowers are going to have to take matters into their own hands if we're going to have a solution that affects everybody, rather than just -- >> what do you mean borrowists take solutions into their own hands? >> well, for example, imagine a website in which borrowers with student loans can pledge to stop making payments if 5 million other borrowers make the same pledge. if 5 million americans simultaneously threaten to stop paying their student loans, congress might then be forced to refinance those loans. but it's only tactics like these that are going to solve the problem going forward. borrowers have to be as tough on the banks as the banks have been on the borrowers. >> but bill, haven't you written

yourself that it's not -- i'm not going to -- i'm not implicating the banks or whatever, it's just whenever you extend credit to anything, whoever's extending the credit, whether it's a big wall street bank or the federal government, prices go up, right? prices go up for houses when interest is cheap. prices go up for cars when loans are cheap and plentiful. why is college any different? >> first of all, we have altered the meaning of college in our society in the last 30 years. 100 years ago, it was realized that citizens needed public education -- needed to be educated to function in our society, so we created free public education. when that education needed to be extended through senior high school, we extended free public education through senior high school. now we're discovering that a college education is necessary to function in our society, but instead of extending education as a free public service, we've started to sell it. you used the word investment before, that college is a good

investment. when did it change from being something citizens have to buy in order to succeed from something that they were provided by the government as part of their right as citizens? >> or didn't need college at all? 100 years ago, you could become a lawyer, bill, without going to law school. >> well, that's only because our k-12 education system has become so bad that people are not learning what they need to in high school. i mean, there's another problem here. it has to do with k-12 education. >> but to bill's point, why do i need to take philosophy 101 if i'm an education major? the other half is elective which keep you in school four to five years. why do i need those classes, to round out as an individual? >> well, this is a good reason for employers to get involved to really show what the importance courses are. and they may be liberal arts courses. they may involve reading and writing and critical thinking, not just business courses. >> nothing wrong with liberal arts. just political science. >> i think there is ample evidence that -- >> look at me!

>> -- that this society needs more critical thinking. >> but bill, i agree, i agree. we've got to go, though. thank you very much for joining us. nothing wrong with the liberal arts. >> yeah, i can't decide if i agree or disagree with him. all right. coming up next, the world cup curse. avo: waves don't care what age you are.

take them on the way you always have. live healthy and take one a day men's 50+. a complete multivitamin with 7 antioxidants to support cell health. age? who cares.

i research. i dig. and dig some (trader more. search. because, for me, the challenge of the search... is almost as exciting as the thrill of the find. (announcer) at scottrade, we share your passion for trading. that's why we rebuilt scottrade elite from the ground up - including a proprietary momentum indicator that makes researching sectors and industries even easier. because at scottrade, our passion is to power yours. the u.s. kicks off its first world cup game against ghana in just a few hours. while many of you may be rooting for the u.s. to win, a note from

easy mize may make you think twice. it's the world cup curse. the sugar high. the equity in the economy that wins the cup grows 3.5% in the month after victory. three months later, the winning team apparently of the nation underperforms the global market average by 4% over the next year. and things are even worse for the runner-up. on average, the nation that comes in second in the world cup underperforms the global average by 5.6% in the three months following the game. brian? >> message -- dear america, lose today to ghana. >> yeah. "closing bell" is next. good luck, america. welcome to the "closing bell." kelly evans down here at the new york stock exchange. >> hey, kell. i'm scott wapner. bill griffeth is back tomorrow. iraq looms as the market struggles to find direction. what is weighing more on equities right now, the troubling and still unresolved si