dow down 151, more winners though, verisign is a winner. a lot of the insurance stocks are down today, along with a the home builders. but there, tyler, three winners. that is all for power lurge this friday. >> simon, always great to be with you. "street signs" begins right now. happy friday everybody, the sun is shining outside, but the markets are not we're just a few on the party of all the others. the drug that both saves and kills. we'll explain. and good news if you like shopping, guy or gal. 40% is the new normal, but the retailers make any money? million dollar homes plus billion dollar divorces. we have it all here on street signs. thanks for joining us as well

today. >> happy friday to everybody out there. happening right now, president obama is tackling america's immigration crisis with several central american leaders. let's get to amon javers with more on this. >> we expect the president to meet with three central american presidents here in the next 15 minutes or so in the white house. the presidents of el salvador and honduras will meet with president obama. we expect during that meeting that president obama will urge the central american leaders to really get the message out about the humanitarian crisis on america's southern border, telling parents that if they send their children to the united states, they won't necessarily be allowed to stay here. there you see the leaders arriving at the white house within the past few minutes. also we can expect that the president is going to urge them to do something about the network of criminal smugglers that's helping a lot of unaccompanied minors come into the united states. all of this of course as you guys know coming against a backdrop of a legislative fight here in washington over just how

much aid to spend on beefing up security and handling all of those thousands of children who've been coming into the united states. what to do about all that is a big, big problem here in washington and throughout the americas guys. >> thank you for the update. okay, you already know about the wonder drug, that's the pill that cures hepatitis c, but it costs $1,000 a day, and you're already know it's about to killer for medicaid. but now private insurance companies are starting to sound the earnings alarm bell about this drug. and here's another question for you. is it even ethical to charge just so much money for a treatment? we've got a guy on, he's a financial and ethical debate expert, is going to be joining you later on in the show, you can't miss it. do stay tuned for that interesting conversation. well let's take a look at the markets, okay, we have a couple of bad apples that are ruining it for everyone. i'm not talking about a.m. the company or the stock which is moving higher today. i'm talking about for example, amazon here. it's down by 10%, it's

responsible for about 60% of the nasdaq 100s loss today. and also visa here which is down by about 4% but dragging down the dow to the tune of 60 points. we're going to bring you more in talking numbers later on in the show. and as for the s&p 500, it itself over the course of the week is a little changed. melissa, we'll keep on watching the score and what's happening here. let's go straight down to the floor of the stock exchange and find bob, we're looking quite red here going into the close, aren't we bob? >> yeah, i think visa's far more important than amazon, visa made specific comments they're not seeing the pick up in the economy that they expected. here's the s&p, here's the problem today we dropped here, a lot of comments were coming out of europe. there were some reports that the eu specifically, the head of the eu might be considering tougher sanctions against russia. they haven't bought into this, reports that that might happen and reports around the russians may be providing heavier weapons

systems. you can see the effect on brent crude, that's what really moves the market. when oil spikes up, that's when everybody suddenly starts paying attention. that's happened about this time. the reports came out at the same time we saw germany moving down. germany much more affected by the ukraine talk and issues than we are. down 2% for the month. finally, i just to want point out, mandy, i'm worried about momentum napes. semiconductors a big leader all year, two or three days of distribution, they're selling them heavy. midcap and small cap names. serious logic, free scale, maxim integrated. now when the bioteches drop, i say, a lot of crazy momentum guys play this. when i see semiconductors drop several days in a row, it gets my attention a little more. this is what i'm watching more carefully. >> thanks so much. poor market performance due to disappointing earnings points or bigger conditions? let's bring in highland kpool management and btig dan

greenhouse. good to see you. the headline is if you look and dig deeper, inflows into bond funds, the largest weekly outflows since mid-july, mid-june, excuse me, and 31 straight weeks of in flows to bond. dan, what we are witnessing here in terms of the flows seems to be a retreat from greed, risk aversion. is that the way you interpret it? >> that's accurate. at the same time, i have a hard time believing that these types of flows are indicative of future market performance and that's what matters. clearly, if you look back over the last say two years, flows have not been related to subsequent or even past moves in the market, and i'm not sure there's anything to look ahead to and these flows are telling me someone knows something i don't. >> mark, what's your interruption of today's move in the markets because we did have potentially widening sanctions against russia. we also had the russian central bank surprising with the rate hike to the upside just because

possibly a gio political tensions. are you concerned that the geopolitical will come back in the coming weeks? >> i think we all are. and i'm not surprised to see the outflow. i think dan's right, this isn't the end of the bull market, but i think there's a pause here and the market's up 7%. off lot of in your opinions coming out next week. we have gdp, inflation, wages, we have a fed meeting. we have a potential argentina default date. there's a lot coming, and i think investors are maybe taking a pause. when we look at the outflows out of ek wes it and etfs, as you know they are passive fund. so you're getting out of passive. we haven't seen money coming out of mutual fund which are more active. we've seen inflows into things that are more active, active, sort of management. nontraditional bond fund that seem good inflows. that's a good sign to me that people are maybe getting more interested in the micro, trying to position themselves better to

be traders as opposed to calling what we're going to do in the second half. by the way we don't see the second half being the same as last year where you have this massive back half rally. >> talking of rallying or pulling back, dan, i think we've gone about 70 sessions now since we had the last 3%, correct 3% with we're not even talking 10% which is the proper definition of a correction. 3% pullback. what do you think is going to be the next catalyst to get us any kind of magnitude of a correction, if any? >> listen, i have no idea what the answer is. i think the argument about the 3% correction is a little more valid in my mind because, listen, i don't know when the markets going go up or down on the short term basis and i don't think anybody else does either, but i think we, if you look over the last two and a half years or so. the time period during which we would say this market's gone straight up. there have been a number of corrections. what's happening right now, coincident with what mark and i are talking about. semiconductors or the macro is

that we've gone about 71 days or so since the last 3% correction. now you might say what does that matter? that's just about the type of correction we're getting in this type of market and this is almost about to be the longest we've gone without such a correction. the short term here could certainly be a bit to the downside, but it sound like morgan, i agree, the bull market doesn't end because there's a minor correction. >> that's correct. >> mark, to your point though about the move from passive investing to active investing. we have the s&p technology index. that's close to 14 year highs that the point. yet we have this earnings data points, and i'm wondering if you look and think that they may be sentiment killers. amazon, you look at qualcomm. does that concern you here? >> die verns within the sectors, amazon, but facebook is up 38%. they put out great numbers. we're seeing the diversion. comes back to my point about being a stock picker. you want to be in situations

that you feel good about the fundamentals because they're starting to matter more. when prediction becomes difficult, that means preparation becomes more important. we think that that's a theme going forward from here, preparation beats prediction. it's hard to predict things as dan said. i agree with him, it's very difficult the call where things are going. you have to focus on the micro, and that's where what we are seeing. seeing this dwerngs, and its been a profitable thing to do. if you're a long short fund, if you're in a global allocation fund where you can go anywhere, there are a lot of interesting things to be doing in here. there's good money to be made. >> always good money to be made, dan and mark, mark, welcome to "street signs," thank you. >> thank you. okay we're digging in on pandora's plan, and amazon's big miss. >> don't call us crazy, but there are only about 152 days until christmas. but for many retailers, it's christmas in july. the summer time mall madness

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pandora opens up box and traders didn't like what they heard. dropping like a stone today down by about 12% right now. the steepest drop in about three months. this is after higher costs offset continued revenue growth. i should say though the results were still better than expected. here's the problem. user numbers and listener hours,

they dipped in june. and that is what is really raising the red flag, melissa. >> amazonman zi -- amazon, mandy is not fairing better. is this a time to reevaluate the stock? let's bring in s&p capitol iq. >> thanks for having me. >> you're at a seller rating financially, it coincides when amazon started to retreat off of its high. off $300 price target. what point do you think it's getting interesting? >> well i think, you know, what we're struggling with here is that the company seems to believe that market share gains and sustainable profitability that both concepts are exclusive. so i think part of our recommendation reflects the fact that, you know, amazon appears to be in a investment mode, and we'd like to see that begin to translate into sustainable profitability. the guidance that was very disappointing, and just looking now, it seems to me that they're doing all of these cool and sexy

things, fire tv, fire phone, kindle unlimited, all of which are in concept nice, but, you know, from a business perspective, investors would like to see more shareholder friendly initiatives. >> you said it, right, in concept, it's nice. that it's spreading too thinly, that's the. is it too thinly? get out of certain things, it has everything, smart phones, cloud services, what else, tv stream box, you name it, it's doing it. should it peel back on some of the things, and start concentrating on the core? >> that's the argument we hear more and more they should focus more on what the core confidence is. now there's no doubt that it's a best in class retailer. if you look at the results, the core retail business is doing well. both domestically and internationally. the problem is a lot of cash flow that's been generated is reinvested into question blg initiatives. i believe that the more i talk to investors, the more they're becoming inpatient, they have

billions now in cash which should be deployed. >> the concern though, if amazon telegraphed that yes, we are going to focus on just being a retailer, the multiple will collapse. it's got to have the growth businesses, but the problem we're seeing right now is that the growth businesses are slowing significantly. i mean the price cuts in north america when it comes to cloud from google and microsoft are really hitting aws at this point in terms of regulator deceleration. what else served to prop up the multip multiple? >> well, i think the landscape leans that way, retailers are straddling traditional and online. so i would beg to differ that the multiple would collapse in that respect. to be sure the evaluation right now is excessive with, but i believe they can probably focus more on, you know, there's no doubt the web services is gaining traction, prime video, beyond those two, it's arguable that the other things they're doing is adding any meaningful value, you know, whether it's on

a mere term or longer term business. >> very quickly, ally bah baa, massive chinese economist giant, it's expanding here, topsy turvey world, how much of a threat is it to amazon? >> i think it's going to be a viable threat. you know there's no question about that, you know, i would argue though that amazon is good at responding to competitive threats. as much as it is going to keep amazon on their toes. i don't think it'll have any near term impact. >> good to talk to you as always. enjoy your weekend. >> thank you. only five months away from christmas which means only 152 shopping days left, or precisely 152 days, nine hours, 44 minutes, and 64 seconds. >> in case you were wondering. >> in case you were wondering. for many retailers like target and best buy, they're already having christmas in july. let's bring in our retail experts, and koutny, i feel like it's going to be christmas all year round. >> you're right.

pretty much what we've heard from retailers and why they're doing it, it's a sexy thing to say black friday in july, they're hoping to give shoppers a reason to come in. it's all the event-based shopping that brings shoppers to stores. bill simon who is now leaving walma walmart. they come out when they have a reason. you get the mountains, then you get these valleys too. >> is this for real, jan? who wants to buy tank top and shorts and give them for christmas? i mean honestly, aren't they trying to get rid of the ininventory they have lying around anyway? >> are you kidding? i can barely wait these 152 days. yes, of course they are. they're trying to get traffic in the stores and trying to clear the merchandise. they had a tough spring selling season. as i said before, the fourth quarter of last year was the most promotional quarter we've ever had in retailing in a non-year, non-recession year. first quarter same way. second quarter will be just like that. you get to july which is the

second most promotional month of the year anyway and it looks like they're giving it all away. why? because they are. 40% is the new 30% off, so in july, it's 60% off. that's not going to change much as we head into the back end of the year, 40% off still going to be the new 30% off. they're going to start black friday november 1st and it's going to run through christmas. >> i could get on board with that, right? but is it 40% off the normal price or 40% off the already fake inflated price? i've worked in retail, i know thousand works. >> it used to be 30% off the fake inflated price. it's still, it's not, it's really not. >> it's real. >> 40% off the old fake inflated price. >> how do they make any money? >> they have to become much more efficient. if you looked at macy's last year, 10 percentage more points promotional than the prior year. it came out of venders, whole

supply chain structure. that's what they have to do. you have to be an efficient channel retailer or you lose. >> and they're getting lean we are varieties too, isn't that true? this back to school season we should see visitors much more lean. >> they're getting faster. so they can carry leaner inventory because they're faster on the uptick. >> so, this really puts the squeeze then on the second, i mean if we're going to dig through this, it puts a squeeze on the second layer of companies that actually, like a hanes, what's your take on who this really crushes? >> it doesn't crush anybody, if you're ralph lauren -- >> it's going to crush somebody. if six is the new 50, jim, it's crushing someone. >> you're getting pressure. so unless you can make your supply chain much more efficient, you see growth margin erosion. those guys have still done pretty well, but we've seen some pressure on them. yes, it's putting pressure all down through the system, and it's really because of the internet. because the pricing on the internet's very, very aggressive and a lot of people are going

there. sop trips are down for the rest of investing lives, trips to the mall are going to be eroding, and con skrerngs is going to be -- conversion is going to be up and we're seeing pressure. >> we've talked a lot about brooip's theory that perhaps people wouldn't spend so much on user disposesable income if they were buying a house or car or bigger purchases, but i'm wondering for the youthful generation how much they're using mobile phones, and gadgets and things like that, that's what's goebling it -- gobbling it up. >> we didn't all used to have these wi-fi we all need where where we go. you may not be realizing that you're income is being diverted to things like data plans that we now cannot live without. and so as wages continue to remain relatively flat and teen jobless rate is high. you're not going to have disposesable income. what are you going give up first, sweater or cell phone?

>> i don't want the sweater, i want the latest gadget. what does that mean in terms of action or stocks? >> well what it means as far as the retailers is that you're going to see continued big time pressure in the teen space. i wouldn't want to be one of the a's or the successful fast fashion retailers because they're taking pressure too. >> such as? >> forever 21, h and m. >> those are not investable. >> exactly. >> for the average person. >> and that's why they don't have to be so worried about the pressure. >> they can afford it. that puts additional pressure elsewhere. >> correct. >> so who feels that additional pressure? >> aeropostal, american eagle, buckle, it's everybody that's in the mall that's a public player. >> like macy's. >> and macy's, they're one of the fortunate few that's gotten very efficient, and has been winning the game. >> who says the mall is dead, you and i were there last weekend. >> never seen so many people. >> it was unbelievable. >> it was crazy. we couldn't find a seat.

>> they're probably all goinged to the grand old opry. >> wow, what a road trip. >> thank you, jen. >> thank you courtney. we have a quadruple dose of downgrade today. plus the one drug that could save millions of lives, but it could kill medicare, medicaid, and your health insurance company. financial and ethical debate is growing thanks to new earnings reports. do stay with us. (vo) rush hour around here starts at 6:30 a.m. - on the nose. but for me, it starts with the opening bell. and the rush i get, lasts way more than an hour. (announcer) at scottrade, we share your passion for trading. that's why we've built powerful technology to alert you to your next opportunity. because at scottrade, our passion is to power yours.

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but i think most people would say, if you're doing business here, if you're basically still an american company, but you're simply changing your mailing address in order to avoid paying taxes, then you're really not doing right by the country and by the american people. >> that was president obama talking tax inversions during his interview with cnbc yesterday. tax inversions are when companies head overseas to avoid paying taxes in that country. mark cuban tweeted, if i own

stock in your company and you move offshore for tax reasons, i'm selling your stock, there are enough investment choices here. he followed up with, when companies move offshore to save on taxes, you and i make up the tax short fall elsewhere. sell those stocks and they won't move. tax inversions are favor to believe dividend paying companies, morgan brennan joins us now with more on that, morgan. >> hello ladies. we've seen a lot of these strategies deployed in the health care sector, and charles cantor says, many biotech and medical device companies are doing this because it fulfilled three criteria that makes this attractive. they raise a lot of money abroad, to bring that money back to the u.s., they would have to pay up to 35% u.s. corporate income tax and that's not including the state taxes. second, for a tax inversion to work, the acquisition must be at least 25% of the company's market cap in other words, there has to be an acquisition target that's big enough to buy and

third, this makes a lot of sense for, or makes, yeah for companies that pay dividends or want to pay dividends because the companies in theory would have to pay taxes to repay treuate the money they're looking to distribute in dividends to invests. so tax rates are very complicated and vary by country, but let's say in theory, a u.s. company with cash abroad is looking to pay a dividend, it would have to get that cash and pay a u.s. corporate income tax on top of any taxes paid abroad. to pay about a 4% yield to the cost of that would actually, depending on where that money's coming from, be closer to 6%, thanks to those taxes. now what a tax inversion would do is effectively make all of the companies cash flow everywhere the same. so, the cost of equity on a future 4% dividend would be closer to 4%. now, that would enable to company to sustain its dividend or raise a dividend, keep in mind, there are many ways

companies can manage dividends, but this is one more factor that playing in to tax inversions and making this attractive. >> clearly going to be a rush perhaps to do these inversions. >> absolutely. well in the meantime, there is one stock that wall street is going crazy over today. and that name is ahead. and we're talking million dollar homes and billion dollar divorces. what a combo. all ahead when "street signs" returns. in a world that's changing faster than ever, we believe outshining the competition tomorrow

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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. take a look at that pop, it's today's ipo el pollo loco. it's a mexican style fast food chain. the stock is now trading 29.99 a pop on the first day of 53%. >> nice. >> loco. >> i try. >> you try now. okay. >> keep practicing. time now for street talker analyst recommendations, take a look at gm getting a downgrade to an outperformed from a buy to buy, i don't know, that's crazy. outperform from a buy. >> that sound crazy. >> so anyway, here's the background, so the official is basically questioning gm's ability to leverage pricing

gains from new trucks. so the target has been cut five bucks from 45 to 40, and also downgraded the stock from a buy to a hold on dissent grating momentum. as we can see there on the board. it's currently sitting at 35 and change. >> d.r. downgraded to a mutual. >> the company is sacrificing near term margins. the shareses are down about 10% just this past week alone. >> and we had another downgrade today, bob mentioned this, max m integrated, it warned today. >> that's right. so getting a downgrade to a neutral, it'll take time for them to find any customers. mobility products specifically, the cut from $39 to 30. sitting there at 29 and change, just below the 30 mark. >> rounding up on this down day, getting pumped to a neutral,

this is a new low for the stock in fact. >> right, and the downgrade comes after the vender slashed its output for the year. cut its target on the stock from $45 down to 36. and lucky last, upgrade here, getting upgrade to a buy from a hold over at jeffreys. >> finished on an upnote, moving high by about 9% there. very nice. being bumped from 78 bucks to 130. so almost 67% upsize there. it soared more than 15% over the past 12 months. okay. let's talk visa. shares of the dow are down about 4% today. hoping to take the index down with it. both the credit card processing giant did beat us, it did cut the revenue forecast on growth concerns. the stock is down about 5% on the year. the question now is what do we do? let's talk numbers. katie stockton and erin gibbs, certainly is girl power today, isn't it it? >> it is. >> katie, technical side for

visa. >> i think if you're bullish on the broader market, also bullish on visa. it does have improved momentum of course after that april low. and let's refer back to april. it gapped down in response to earnings and that ended up being a short term low for the stock. i think the risk reward is quite favorable, gaps down due tend to be setbacks over the near term. we could see near term downside follow through. on the chart there is support around 205 to 207, and with next resistance around 235, 236, it creates a compelling risk reward. >> erin, the concern here for the stock on the fundamental side is the dier have jans. that's not going to resolved any time soon. >> and also that there's lower currency volatility which we also don't see being raised any time soon. there's a lot of concerns. we don't own this stock in any

advised portfolios. we're not looking to add it any time soon. for us, when it gets below 21 times forward earnings, that's when it gets more attractive which right now is basically around 205, 210 mark. i think, like i said, the earnings haven't come down, but the revenue concerns are out there, and another thing that we're also looking at is that it's pe really peaked back in january. so it peaked at about 26 times earnings, and has since been retracting further and further. so until we really see some momentum, some positive catalyst for this company, we use this as an avoid. >> avoid, thank you very much. message loud and clear there. here is a very difficult financial as well as ethical dilemma. dlaug saves millions of lives but could break medicare, medicaid, and maybe the private health insures as well. how do we decide who gets it.

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welcome back to "street signs" i'm morgan brennan. ibm shares are running lower. it talks to sell its chip making unit, fell apart. ibm and global foundries reportedly failed to agree on terms, looking at that stock, it's down half a percent, back to you. remember cync technologies. . became an $5 billion company before regulators holded trading. today it resumed and as you can see on the board there, it's taking a big hit, down. it is currently down about, '83%. >> ouch. all right, got shoddy

credit? never fear because there's a used car dealer who will still give you a loan, believe it or not. there is a boom in subprime loan for cars. bill and kelly at the exchange. we've heard this before. >> unfortunately, and we're hearing it more and more now melissa, there was a big story in the new york types the other day, they did an investigation of a number of sales, transactions, and they found a rise in subprime loans for automobiles where in many cases now you're being, the cars are being repossessed because they couldn't afford it. >> there's a heated debate over this and whether it's going to be a systemic issue, whether the auto strength would be there anyway. which alone also tells you much like it did with housing last cycle. it's far from clear to anybody as to how important this component is and how it's going to play out. >> both sides of that story coming up, plus the last hour of trade, see if we can pull things back a little bit now. down 130.

>> not a pretty day as we go out for the weekend. geopolitical tensions weighing. >> see you at the top of the hour. >> thank you very much, guys, looking forward to it. popular million dollar home competition is back. six homes are battling it out to see which one is the best bang for your buck. this time we're doing something different. we're looking at reclaimed homes. yeah, each home was originally built for another purpose. like a church or a warehouse. here's how it game works. two $1 million homes faced off. first time ever, we're having you pick the winner. this is a live vote. vote as many times as you want. not sure that's fair, but whatever. or you can go to cnbc.com/vote. the winner will move on to the next round and the loser naturally is eliminated. so far, the mill mansion has won round one, two, and three. can it keep winning? we have a new contender. it's the barn charm, let's take a look. >> this former flower mill sits

on three and three quarter acres. built in 1836, listed on the national historic register and recently its been gungsing as a bed and breakfast. inside this home, many pieces of the original machinery remain. alongside modern appliances. like these authentic brain funnels, now lights inside this enormous commercial grade kitchen. . the property has three bedrooms, one full bathroom, and two half baths with wide open floor plans. across four levels. and this detached guest cottage used to be the hog house. in the early 19 century, this water fall powered the mill, today it adds to the peacefulness of this farm country property. this historic stone mill far million dollars. >> reporter: this early 19th century cattle barn sits on just over an acre, about 30 minutes from a major city. the exterior walls have been recently reinforced and the interior is a work in progress.

on the lowest level of this 8,000 square foot home, the kitchen has every modern amenity. of course, the cattle used to come in through the front windows, gives new meaning to farm to table. all of the exterior whams are stone including here in this master suite. one of five bedrooms and three bathrooms. but the interior walls can all be moved. so if you don't like them, move them. the barn boasts a bevy of bonus rooms, ample space for indoor basketball, racketball, an inspiring artists studio, and of course, plenty of room for a barn dance. all for the asking price of one million 50,000. >> everyone wants do barn dance in their house. let's bring in dolly to shed lights on the two properties. sop we know that the mill mansion is located in upstate new york, but the barn charm, where is that? >> it's in vil low in a va, pennsylvania, which is a really terrific location, it's only 30 minutes from downtown philly. so you're actually close to a

hub which is so nice. and lots of great schools there. everything you really could want it not far from home. and i love. >> what we're seeing in the live voting here which is of course the best bang for your buck. so far the mill is getting 53%. voting is still going. >> please keep going, come on. >> the mill, the mill house seemed nice, but it seems like it's in the middle of nowhere and one full bathroom which seems like a problem. >> especially in the middle of the night. >> are you going to walk. three stories to go to the bathroom? >> exactly. there are a lot of issues, i think, and the hardest one is the winter. you know, summer, it's beautiful out, right now every house looks amazing. come the depths of winter. >> it would cost a lot because they have big windows and big tall rooms. >> would we found a house in the winter? would we have to salted roads to get there. it would be very tough. at least the other one is in a hub. >> count the revenue stream as a

functioning bed and breakfast on the mill house in the bang for your buck? >> i don't think we do. >> it's just the property. >> exactly. we can, but i don't think that we do. >> the voting is closed. it's closed now. and you can see there the bottom of the screen, mill, 57%. >> morgan goes again. wow. this is unbelievable. >> four round now. >> i attribute it purely to morgan. >> stay tuned to see if she gets it. >> you get to the live in the house. >> yeah, good. >> gooded to see you. >> you too, thank you. ken griffin and soon to be ex-wife will be dividing up a fortunate, estimated about $5 billion. wealth expert robert frank joins us now with more on this billion dollar divorce, robert. >> thanks melissa. like most billionaire divorce, this turned kind of ugly. they were married for about ten years before they separated a years ago, now people familiar with the case tell me they tried to work out a settlement

quietly, but in recent months, those discussions became more contentious and ken filed for divorce while they were on vacation. they do have a prenun and the divorce filings says it's valid and he's satisfied all of the obligations, but the issue here is custody of the three kids. now he wants joint custody and as part of the talks, she may actually challenge the prenup, kind of like with wendy and rupert where she got more in that settlement. now this is just the latest of a string of hedge fund divorces. david tepper worth about $10 billion. he's splitting with his wife of 25 years. and christopher hone of london children investment fund, he's in a nasty, public battle with his ex-wife over their billion dollar fortune. so the question is hedge fund billionaire more prone to divorce? they have a lower divorce rate, surprising, than the overall population. it's about 8% for billionaires compared to about 40 to 50% for the overall population.

guys. >> okay. robert, thank you. >> thank you. think about this for a second. what if three million americans had a disease, and they could be helped by a new drulg, but the cost could cripple medicaid and medicare. what would you do? >> sorry, go ahead. >> i was going to say, it's not a hypothetical anymore. it's real. private insurance companies are sounding the alarm bells about the drug. stay with us for the very latest. we started zya with the thought that the kid on the back of the bus might have a song that he has in his head but he just can't get out. with the technology of cloud, we change all that. i can sing something into my device, up to the cloud it goes, back down it comes, sounding better. we break down the walls of creation and we give music creation for the masses. ♪ ♪ unlock the creativity in anyone. with the ibm cloud. the ibm cloud is the cloud for business. thank ythank you for defendiyour sacrifice.

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if you're sick and there's a medication to make you better, you'll buy it, right? but what if that drug costs $1,000 a day, 84,000 bucks for a full 12-week course? and what if your private insurance company said this one drug alone was gutting its earnings? cnbc's bertha coombs has the full story. it's a bit of a dilemma. >> and not just for insurers, for all of the payers. the cost of sivaldi continues to draw fire because of this as state insurance and medicaid programs are forced to pay for it. no debate, the hepatitis-c drug from gilead sciences is a breakthrough, can cure the virus that leads to liver failure quickly with no side effects. as estimated 3 million to 5

million americans are infected with the virus, so demand has been huge already. gilead sciences has seen nearly $6 billion in sivaldi sales since it launched this year, but payers are feeling the care. wellcare posted a net loss of $7 million due to higher costs in its florida medicare plan driven in part by help c drug costs. magellan also reported a big spike in health care costs in the quarter, sending insurers lower overall. the medicaid plans will be reimbursed by states, which are struggling with sovaldi. it will save on costly liver failure cases longer term as the drug industry argues, but not near-term. >> i've heard anecdotally that some states are saying they've spent more on sovaldi in the first quarter of this year than they did on all liver

transplants in the past two years combined. >> now, express scripps estimates states will be on the hook for about $55 billion in new hep-c drug costs over the next few years, and they get a 23% discount for medicaid plans. >> wow. >> so, they're getting it at a discount compared to commercial insurers. >> amazing. bertha, stay with us. we have with us the director of medical ethics. art, good to speak with you. what is part of the heartbreak of this story is it's not just a treatment, but a possible cure. they said that 9,000 patients have been cured with this drug. at the same time, how does a drug company come up with this number? i'm sure they would argue, it costs that much to develop this sort of miracle drug. >> well, you know, they think hard about their prices. one thing they take into account is what are we spending on this disease already. so, we do spend a considerable sum of money giving people liver transplants when their liver fails due to hepatitis-c. there are other drugs already

around that we're trying. they do say, hey, we've got to recoup our research costs, but you know, they're really recouping the cost for their entire research enterprise, because some drugs they make don't work out. and they're kind of pushing the market to say, you're going to pay for this. so, it's a combination of all that. >> and for those who say, well, how can they justify that kind of mind, i would push back and say, just from the devil's advocate point of view here, art, $84,000 to cure you in 12 weeks, save your life, improve your life? maybe it's not that much. >> well, it's a fair point. look, we're spending $1 billion a year to try to eradicate polio. there's a bunch of drugs out there that cost hundreds of thousands of dollars that basically buy you two or three months of life, a bunch of these new anticancer drugs. so, why this one causing the controversy? look, people get hepatitis-c because they use needles in drug use behavior. people don't want to say it, but it's part of the reason i think some are thinking, hey, should we spend on something that you

cause or you harmed yourself? there's another angle, it's public payers, you heard. medicaid, programs for the poor. do i want to pay a big bill for somebody else? i don't think we hear as much complaint if it was -- >> hold on. these are fascinating arguments, but you're saying it costs $84,000 for cancer or some other drug that's not necessarily for a disease, that's not necessarily caused by you through needle use, then there wouldn't be as much pushback? >> oh, yeah, like -- >> we'd be a-okay bankrupting medicaid, medicare and potentially having the private insurers pay out because it's not your fault? >> well, there's part of that. and imagine if this was child n children. do you think people on the insurance side will say, this is for children. >> i beg to differ, because people are using this case to talk about the fact that we are going to see some cancer drugs coming down the pipeline that could be $500,000 apiece. >> wow. >> the issue here is that, yes, it saves lives, yes, long-term,

the costs are less. however, you have a huge volume of people, potentially up to 5 million people, and trying to pay that up front -- >> that's true, absolutely true. >> -- is the real issue. >> but remember, these cancer drugs coming down the pike and others, they're breast cancer, they're colon cancer, they're the common ones, too. if you had something for children with muscular dystrophy or other diseases, i don't know. but let's swing the point around in a different way. the question is what do we want to pay? we all say what are the insurers going to do, what are the payers going to do? >> right. >> the question is, what's congress going to budget? we've seen a lot of yelling right now about the va, right? va is a huge at-risk organization for hepatitis-c. it has tons of vets with hepatitis-c. are we going to put money in there? >> do you think this could lead to more discussion about price caps or some sort of mandatory discount? >> i absolutely do. we're in the middle of rationing. no one wants to say it, but

that's what this is all about. so, bigger co-pays for individuals who want it, some type of price limits or price-fixing for very expensive things, maybe trying to get more bargaining power back into negotiations between government payers and the private entities. i think it's coming. >> really interesting conversation. it's certainly a water cooler story. a lot of people are talking about it, a lot of ethical issues at stake here as well. >> middle of rationing. i thought he was also going to say midcycle elections. >> that's true. >> because this is very popular. >> absolutely. >> art, thank you. bertha, thank you. >> it's almost time for julie's box office prediction. what movie does she say will be a big hit? [ female announcer ] there's a gap out there.

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at the summer event, going on now at your authorized mercedes-benz dealer. but hurry, offers end july 31st. share your summer moments in your mercedes-benz with us. despite a few hits, it's been a disappointing summer at the box office so far, but next "guardians of the galaxy" comes out. will it save the summer or be a box office bust? julia boorstin joins us now from comic-con in l.a. with her predictions. julia? >> reporter: well, "guardians of the galaxy" could be really huge. the studio, marvel, which is owned by disney, was originally expecting around $60 million, but at the premiere earlier this week, i was there. the reaction in the audience was massive. i thought the movie was really great. it was funny. it had a lot of sort of "spaceballs" thrown in there along with the comic book characters, and i think it will really reach across demographics. it has a 100% critics rating on rotten tomatoes and a 99% want

to see rating. almost 100 people have clicked in. we've talked to dozens of people here. they say this is the one they're most excited to see. guys? >> 99%, wow. all right. >> they're very quick -- oh, we've got to go. wanted to talk about the flops. much more interesting. thanks for watching "street signs." have a great weekend. "closing bell" is next. welcome to the "closing bell" on this friday. closing out such a big week here. i'm kelly evans at the new york stock exchange. stocks are taking it on the chin today, this on the comeback bac high-profile earnings week, bill. amazon was the focus the last 24 hours. >> it was, but it's visa that's taking a toll on the dow itself. russia, all of that combining to make this cocktail that is weighing heavily on the markets today. the industrial average was down 168 points. we're off that low right