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good friday morning, welcome to "squawk alley," joining us as always is jon fortt and kayla tausche. where the sell-off does continue. the market is in the red. the bulls made a couple of attempts, but we're not far from session lows. the dow tracking its worst week in four years and the s&p in spitting distance of a 1 handle. biggest losers of the week include netflix, ross and intuit. two portfolio managers joining us today. good to see both of you. are you sensing what, orderly selling? panic selling in what's your sense right now? >> i wouldn't call it panic selling. global growth is decelerating, we were at valuation points where we were over-extended and now we're seeing a readjustment. what's occurring is that the china deceleration of growth is now starting to take effect in the emerging markets area leer. so you're going to start to see general credit market dislocations, potentially on the high yield side. you're starting to see that

within the commodities markets. as well as oil market in particular. >> jim, i saw my first ted spread chart in a very long time yesterday. s people start to worry about liquidity in the bond market. do you see this as the first, one of those preshocks that, that predate an earth quake? >> no, i don't, i think there is going to be dislocations in the high-yield bond market. i think your other guest is exactly right. i agree with everything he said. what investors need to remember is while this dip in the negative territory is unusual over the last four years. over the long span, it would be more unusual not to go negative at some point in the year. it's pretty normal for a market to go negative at some point in the year. what we're looking at still is very low interest rates, 2.06 on the 10-year treasury. we have some concerns about growth around the world. but that should make the u.s. look better by comparison. and here in the u.s., our ism

services sector looks very good. the biggest part of the economy. yesterday we had the philly fed report that came out. it does show growth, yes. it's subpar growth, no the what you want, but it is persistent growth. i agree that the markets maybe got a little ahead of themselves. now they're readjusting. but at the end of the day, what's going to be the favorite asset class? i don't think it's going to be bonds or international markets. think we'll see stock market investors come back to this market. >> readjusting as that may be, jim, i'll throw the question to chad, disney, the poster child of investors trying to figure out what right place to pay for some of these companies is. if you are wanting to buy the dip and wanting to ride this higher, where is the dip? what's the price you're willing to pay for some of your names? >> our group thinks about 5, 10, 15%, we would not be shocked. the forward-looking multiples close to 17 times on the s&p 500. you could see operating margins

on the s&p 500 drop by an additional 100 basis points. we would move up the quality spectrum, get out of the speculation classes. and going to be investing in low-momentum investments, as opposed to high-momentum investments, the high-flyers, stay away from them. go to the companies like dr. pepper, hershey's, the boring of the boring. >> it occurs to me that the leg down isn't because of any one particular thing. it's not like there's been one event that has led to this. but i wonder is there some particular metrics or group of them that you're going to look at and say, either this continues or this doesn't. i mean what separates this as just a healthy readjustment versus something that's more concerning.

to get to your question, i think what you're going to want to see is breadth start to improve. while i agree with chad's first answer, i don't agree with his second answer. think what you're going to want to do is come back to some of these names that have just been hammered. in the last couple of days we've seen a lot of the babies thrown out with the bathwater, that's another thing i was looking for in terms of when the market sell-off is maybe abate, is throw the babies out with the bathwater. we saw very popular names get trashed over the past few days. but where is your growth? your growth is in health care, that's been a leading sector over the last year and a half. i think that's where you're going to see the growth. in certain tech names. i think investors are going to get, have to get used to a stock-pickers' market rather than a buy all the indices all the time market that we've seen over last few years. so use this sell-off to buy some of those leaders. off of their highs as they correct. and i think that's what you're going to want to look for. i think the bonds will settle

down and i think breadth will improve and that's what we want to see. >> why is the 10-year stuck at 2.06, 2.07. are people going to cash instead? >> you haven't seen a substantive sell-off as of yet. you haven't seen the panic in the market which would push people into the 10-year or the 20-year, it would go down to 175. hence the reason why i started this interview saying we haven't seen real panic yet. you haven't seen that flushing out of the market. now, the thematic is going to be global growth deceleration. and investors have to get used to that. not only here but across the globe. so the european or the eurozone markets and the economy there, deflation, deflationary trends. growth there. expectations, by the imf, it was 1.5%. >> you weren't encouraged by the pmis? i would say stay in the united states. the overweight dollar-denominated assets, move up the quality spectrum and wait for your seams of opportunity. it doesn't mean there aren't

seams of opportunity, be a little more pragmatic. >> chad morganlander from steifel, and jim lee camp from ubs. when we come back, top vc gurley sounding the alarm about valuations. and twitter back below the ipo price, is now the time to nibble on that one? we're still watching the markets, dow is down 248 now. has been down triple digits since the open. on days like this, the european close, sometimes a driver of action at least in the middle of the session, we will get that in just over 20 minutes. don't go away. opinions. there's no shortage in this world. who do you trust? whose analysis is accurate? how do you make sense of it all? a simple, unbiased stock score consolidated from the opinions of independent analysts... is that too much to ask?

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to components in the green. by the way if you're watching to see when the dow, if the dow hits correction territory, needs to be 16,516, which is almost exactly 200 points below where we are right now. >> worth watching. joining us on the phone is kara swisher, co-executive editor at re/code. kara, first up, another rough day for the tech sector. right now we've got the nasdaq down, gosh more than 2%. s&p 500 getting close to 2,000. on track for the second worst week of the year. and top vc bill gurley talked

about the sell-off on twitter. his first-ever tweet storm saying it could start to sink some tech unicorns, saying that global tech valuation multiples are compressing quickly. if so we may be nearing the end of a cycle where growth is valued more than profitability. it could be an inflection point. investors are likely to refocus on business model viability and path to profitability. it will seem like an abrupt sea change to many. and then asked if a lot of these companies are ready, kara, your thoughts? >> yeah. it's interesting. it's an interesting question, it's funny it's coming from someone who has been funding these unicorns, including uber and snapchat, whose numbers are out showing them losing a lot of money. the guy, it's sort of like the guy in casablanca, who said i'm shocked that gambling is going on in this place. it's a little bit disingenuous for heem to dot funding of these things and push growth growth growth and say uh-oh, watch out, may be sending a signal to the companies he's invested in. he's a real smart guy, bill is, and he's very thoughtful.

but you know, it's the vcs that created this situation and have been mushing for growth over profitability. now i guess they want profitability. i'm not clear why today at this moment. but the disconnect is big between private and public companies. >> to his credit, he did mention months ago there was a sort of late-stage inflation in valuations. but that the point i think -- >> he created. that just -- to be clear. to his credit, that he created, and so did andreessen horowitz, they love to do this. they love to like create a giant mess and say oh, my gosh, who made that mess kind of thing. i don't know. >> but they're not the only ones, kara, there's so much new money that's coming into the late-stage space. i'm wondering if you think the nature of some of that is going to exacerbate it. the mutual funds, hedge funds, are having to mark some of these positions to market much more often than the vcs do. >> the thing is there's nowhere

for the money to go. i was talking to a really big investor yesterday and he was talking about how public companies, apple is 11 times and it could go to 8. it's apple. air issues are not going to be anything but apple issues, that's a great company that's doing great in lots of ways, whatever you think of the apple watch or new products, they're still a fantastic company. so they're trading at the multiples that are so small compared to their value. it's just, he was sort of fascinated by that idea and he wondered, you know, if these numbers would continue. and he's a big investor in a lot of these companies. >> we should mention we're down more than 300 points on the dow. the s&p has broken below 2,000, not a technical level, but certainly a round number that we noted on wait up, important to note on the way down, the s&p at levels we haven't seen since the beginning of the year. >> kara, to that point we're watching correction levels being approached by the s&p and the nasdaq. we have some 35% of the

components of the s&p tech sector that are actually in bear market territory. meaning that they have fallen more than 20% from their most recent highs. i'm wondering what you're hearing from some of the public companies, that i'm sure they're getting pressure from their investors, i'm sure they're putting some secondaries on hold and makes their business model as little hard to sustain. >> worries about china are at the top of mind of a lot of companies i talk to. a lot of them are showing weakness in revenues. some of them. the product cycles are tougher for companies and what they're putting out. i think that it's just. this has been going up and up and up for a long time. it's not like it's a shock that it could go down. some of the expectations are higher. that said, a lot of these tech companies are really a bargain at this point, i think. especially big ones like apple and others. >> it's kind of an interesting situation where the more valuable companies are getting

really hit and the private companies are not. there's definitely a sense of worry. if you have the bill gurley thing, i'm waiting for mark andreessen's tweets on five, four, three, two, one, another person who has funded a lot of these companies and who talks about software eating the world. it's ironic in a lot of ways. >> kara, as you've been talking, we've broken the s&p 2,000, s&p 1999 we've not done that since february 2nd, we hit an intraday low of 1980. but this is obviously happened a lot faster in a more compressed period. >> it's freaky friday, right? there's questions about the political stuff. china, all kinds of stuff. i think investors are justifiably nervous and have been waiting for this. maybe it will be a small correction that will just take a little pressure off the situation. but definitely investors have been just a little bit more wary. mostly because they've been

throwing money at the companies, like lots of companies, sharing companies, car companies, at some point not all of them are going to rise. >> kara, give us some color. in silicon valley at a time like this, do funding rounds come to an absolute standstill? do people try to pull their hat, like indiana jones from the gate before it closes? >> they pick the winners. and the others just get sort of like, the herd gets culled eventually and the ones that are sort of out there which need some more burn i think that's an issue. the ones that have more burn are going to get slapped around a little bit. and then there will be some buying, obviously, there's merger, acquisitions, a lot of great stuff out there. the bigger companies, people see opportunities in negativity. i don't think that's the case at all. everyone is awash in money. where else is it going to go?

that's the problem. >> kara, i found it interesting last night, an intuit report, it said it's spinning off quicken and spinning off demand force, which it just picked up about three years ago. interesting that brad smith over there is deciding to focus as a response to some of this competition from the start-ups in a small business space what do you expect to happen? >> i think fi-tech is an area that's getting a lot of focus. if you know the andreessen horowitz just hired a partner, alex rampell, to be the fi-tech person. i think it's a really interesting area. and of course a company like intuit and banks and credit card companies, there's a lot of disruption going on in this space. >> kara, just really quickly. we did have meg whitman on our show earlier today. she talked about the challenges for pcs. cramer asked is there any hope

at all for growth in pcs? the short-term? and her answer was, i don't think so. >> i agree with her, why would she say that? is there any growth in the work storage business i don't think so. it's all about, especially with apple coming out with the ipad pro. all of these good microsoft service tablets. the workplace is changing and the idea of pcs is antiquated at this point. that's their business, unfortunately. but nobody is buying pcs, and they're hardly buying laptops. so you're going to see a real shift. this is a real secular shift that hp is going to have a hard time dealing with that said. they did great in the enterprise space, they got those currency things to jump up and down that caused issues for them. >> they're not buying tablets either, apparently, if you look at apple's growth numbers. >> that's the question. how is the workplace going to be? and mobile is really important. i do think that the tablets are going to be bigger than a lot of

people think, eventually. we'll see. >> thanks for putting a fine point on that, have a great weekend, thanks for joining us. >> let's get another check on the markets in what has been the worst week for stocks all year. all major averages down more than 1%, the dow briefly down more than 300 points, it's pared some of those losses, down 1.6%. s&p is down 34, nasdaq is down 93. we're watching for correction territory for the nasdaq, 4708. we're just about 75 points away from that. josh lipton is in san francisco with a look at some of the biggest movers in tech this week and it has not been a good week for that space. josh? >> tech sector, the second worst-performing sector this week, now on track for one of its worst week so far this year. more than 30% of the tech stocks in the s&p 500 in bear market territory. down more than 20% from their

most recent 52-week highs. and that list includes companies like micron, sandisk, which is down hard. also finding its fans, craig ellis of b. riley said he took sandisk to a buy, knowsing that pricing, margins, design execution all improving. other names deep in the red include yahoo, down more than 30% year to date and first solar. in addition, 60% of tech in the broad gauge in correction, off 10% from the recent highs, that list includes oracle, emc and salesforce, though that stock, salesforce is in the green today after the last earnings report. pleased the streets so mark benio benioff's company bucking the street in the today's trade. and another move we'll keep our eye on is netflix, down hard again today, down more than 10% in the past five days. scully of cantor fitzgerald says netflix, a crowded momentum name. when those names crack, they tend to free-fall.

still scully telling me he remain as netflix bull. he points out the company just this week raising prices in europe. so france, germany and the netherlands specifically. that's an indication he says, subscriber growth is strong. scully's price target remains 125. kayla, back to you. >> tough week for tech and tough week for the broader markets, too, up next, we will get the european close. oftentimes this has been the turning point for the markets amid the volatile sessions, the dow down more than 300 points. ♪ ♪ if you can't stand the heat, get off the test track.

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market breaking down further. we're down 300 points, close to session lows. s&p back below 2,000 for the first time since february. the vix up almost to 24.

bob pisani is on the floor. hey, bob. >> i want to show you the s&p, because the market was a little surprised right at the open frankly. because we gapped lower, i'm not putting up the futures prior to this. but we gapped about 10 points lower than where the market went out, the futures went out at 9:15. that usually doesn't happen. so that's, you know, 120 points on the dow right there the market just drooped at the open on fairly heavy volume. so obviously a lot of people were waiting for the open to sort of get in and a lot of people caught a little bit by surprise at how strong it was. you can see we're just off the lows for the day. in terms of the sectors, all ten sectors are in negative territory. but once again tech, consumer discretionary, industrials and energy are leading with the way. everything down in that group about 2%. one thing i think is interesting about today is the great leadership stocks that we've talked about for a long time. the small group of tech, your googles and facebooks for example. they're weak here. you see that? and that's the one that

everybody has held up. there's a little bit of elements of capitulation, selling the winners that are kind of obvious here today. i think it's important to put the google and facebook up. simon will tell but the close, but one of the reasons we've been weak in the last half-hour. so europe is looking poor and germany is looking poor and simon will give you details. there you see what's been happening in the last half-hour in germany. they're down 7.5% for the week. it's been a rough day for high beta sectors, solar stocks are notably weak today. cybersecurity, the pure funds one, the second one. and social media and biotech weak. the vix popping up over 20, it's at 23, it's moved 10% three days in a row. that's extraordinarily rare. usually that signals at least short-term bottom. but amentioned, carl, many times i start paying attention to the vix when it gets over 20, it passed it a short while ago.

>> we haven't seen the vix in over 20 in quite some time. oil a central focus of our market action. prices sliding again. wti down 2.5%. brent down more than that. u.s. crude on track for its eighth consecutive weekly loss. the chinese slowdown continues to weigh on that sector. let's bring in senior energy analyst at raymond james. pavel we mentioned the weekly slide. eight weeks of losses, the longest slide in 29 years. is it overdown? >> yes is the short answer. by look, it's macroheadlines, you mentioned china, couple months ago it was greece. the fed, there are currency volatility, it's a lot of nonfundamental things. now to be sure, we've seen saudi arabia, still pumping all out. we've seen a big production spike out of iraq. so but you know, we've known

that for a couple months now. certainly for example oil is down 10% in the past week. that really looks like more of currency and headline-driven move than anything incremental in terms of supply and demand. >> and certainly the china issue would have an impact on this space. even without all of these other macroworries. but it seems like this backdrop of the production glut that we've had, journal calls it the energy industry's version of trench warfare. i'm wondering, pavel, if you think someone needs to blink -- is it saudi, is it iraq, is it the u.s.? >> u.s. oil companies blinked a long time ago. we're seeing capital investment this year in the u.s. oil patch down by more than half. that is blinking. now saudi arabia has been fighting the price war. winning the price war, which is why it's so irrational that they are continuing to pump at record

levels. so look, i'm sure that saudi is under a lot of pressure from other opec members, from venezuela, from the other gulf states to you know, take their foot off the accelerating, it would be healthy for them to do so. they you know, it is not in anybody's interest in the oil industry, to have oil go to $30 a barrel. and based on some of the macro headlines, it could get as bad. >> you pick objecticcidental, h how confident do you feel playing the equity side of this? >> nobody can predict where the price of oil will go in the short run, that's true. but ultimately it has to recover. because today's oil prices do not support investment anywhere essentially on the planet. except maybe saudi arabia. so they will eventually bounce, it is a matter of time.

in the meantime focus on the high quality oil producers. companies with balance sheet stability. dividends and particularly safe dividends. that they're not going to cut because we've seen some, some cuts of late. i think occidental is a very good example of that. 20% debt to cap. 4.5% dividend yield. >> pavel we got to go here. we got to get to the close in europe we'll have you back, talk more about it, pavel mulkanoff from raymond james, we appreciate it. europe is closing, we'll see if simon hobbs thinks it means more buying or selling stateside. >> as soon as they saw wall street was going to head lower. europe went back to negative territory. it's plowed further and further down throughout the session. i think that's why ultimately you've seen another leg down in markets here. perhaps selling inspired by the europeans on these markets before they head off for the weekend. it is deep. actually the data today was quite good.

there's an unexpected expansion in business activity in europe on the composite pmi. let's look at the market over the last two weeks in europe. now europe is already in correction territory from the highs that it had. but take a look at the chart of where we've traded over the last two weeks and you'll hopefully see that the stock market is down now 8% in europe. and i was saying to you yesterday because it's so internationally exposed, almost 9% is the move. this is the broad index. the stock 600. it's true to say that we were cutting the outperformance in europe during the course of the session until you saw the s&p take this further leg down. i think we're at an outperformance. which was 16%, 17%, is down to 7% or 8%. keeping an eye on ha is happening in greece. the greek prime minister appeared in public. after last night he resigned to trigger the snap election. the left wing of his own party has said they will leave the

party and fight him in the election on an anti- austeriaus platform. the opposition parties in greece are attempting to form an opposition government. that's their right, they will fail. each of the three has three days to do that we're looking for elections on september 20th as we were mentioning, 24 hours ago. in the meantime, i think this is perhaps the most important piece of analysis to come out. citi is warning that because you now have the election in greece, none of the austerity measures can go through for a month. that will push the whole process of the third bailout and the assessment of the progress in the bailout further into the fall. they are therefore suggesting you may find the eurozone creditors will not start debt reduction talks with the greeks until next year. that will anger the prime minister if he comes back into power on that pledge to find that they're not playing ball emboldened by an election win. that's not the story clearly for

now, that may be something we deal with in the fall. have a good weekend. the selling continues, obviously we're sitting right at s&p 2000. this may end up being the worst three-day period for the s&p since 2013. then there's twitter trying to hang on to the $26 ipo price, down 30% in a month. we'll cover it and the broad markets in a moment. i'm caridee. i've had moderate to severe plaque psoriasis most of my life. but that hasn't stopped me from modeling. my doctor told me about stelara® it helps keep my skin clearer.

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here's your cnbc news update

at this hour. australian prime minister tony abbott confirming the u.s. has asked his country to expand on its role in iraq by joining airstrikes against isis in syria. he said his government will make its decision within the next two weeks. south korean residents living near the border with north korea taking shelter after the two countries exchanged artillery fire. about 700 residents were ordered to vault and stay in shelters. north korean leader kim jong-un says his country is in a quasi-state of war with the south. and electric generator explosion rocked downtown los angeles thursday night, shaking a 19-story office building. that explosion knocked out electricity to a dozen surrounding buildings and caused a momentary power outage at the staples center where shania twain was performing. there's a more move to get late-night host jon stewart on the presidential debate stage. neither stewart nor the debate

commission have commented on the effort. that would be must-see tv. all right that's our cnbc news update this hour. back to "squawk alley." we're still watching the market in just recent moments we have hit session lows on the dow currently down 314 points. we're keeping our eye on correction territory for the nasdaq as well, it's just about 60 points away and as stocks continue to sell off, there's one sector in particular that could be in danger of cracking, bertha coombs is live at the nasdaq with more. >> you know you don't invest in biotechs if you are faint of heart because they are known for volatility. they are on pace for the worst weekly decline in just over a month. and in correction territory, down more than 12% from the july high. about 1 in 10 of the ibb, the

biotech shares here at the nasdaq in the index are hitting a new low this morning. about 15% of those components are down more than 10% just for this week. a lot of the biggest decliners are small cap. like arena pharma, down by about 16%, orexigen, down, mannkind getting crushed as well. the big question is whether it's a correction that could be a case of a more serious pull-back in biotechs which a lot of folks have said is really overdue. they're on pace for the first quarterly decline since the december quarter of 2012. the index is sitting at a really weak technical area right at its 200-day moving average. so if it continues to fall below there, it could be more bad news, and seasonally october, the october quarter could be a really tough one for biotechs. when you look at a 20-year chtw

chart, you see the corrections in the sector are not uncommon and even when it sits at its 200-day moving average, like it did last september it rallied to year end this one sector really to watch in terms of where the whole market is going, back to you. i'm sure we'll talk to you in a few moments. meantime shares of twitter closing below the ipo price for the first time yesterday, trying to stay positive for today. hovering around the $26. does twitter have further to fall? let's bring in evan wilson, an analyst over at pacific crest. evan, happy friday to you. we've had some analysts predict we would get some management succession imminently. hard to find any sign it's coming any time soon. >> well management, that's a key we're watching at this point in time. we did a big study of how long it takes to typically find a new ceo and twitter is not behind the schedule. we think early q 4 is the time for the announcement if it's like other tech companies that

find themselves in a similar situation. they'll announce then. we think it's most likely that twitter is important enough in the value that they will get a good candidate. >> evan how much does it matter? in the last earnings call twitter management owned up to the fact they don't have the products they need right now to fuel real growth. they're going to have to come up with the products and then it will be a while before we see the real results from those. is management change going to make that big a difference for the stock? >> i guess it matters who it is. if we find someone who is focusing on more revenue that hasn't been twitter's problem, the revenue projection is really good. twitter is too hard to use for mainstream internet users, if they can fix that problem it could be simple or complex. it could be short-term or long, we can't know that until the new person sits in the chair and tells us what the plan is. >> what kind of candidate would impress on the product side? >> i think you could have two potential candidates that would

surprise to the upside. one is adult supervision, so when it comes to twitter and gives it more credibility with the street. the second one is someone who comes from another internet company, facebook or google who is known as someone who can develop a product that's easier to interact with for mainstream users. we know that that's the big problem that twitter has. >> push the stock up slightly against a tough tape today evan. we got news about the ad network being expanded so the promoted tweets and videos will reach the entire 700 million user base on the mopub network. how meaningful is that? >> it's meaningful but not big concern. twitter has a network that's meaningful. twitter has done way better than respected relative to the ipo price when they came public on the revenue side what they need to figure out is how to get the user growth to start up again and it will come from mainstream users. we know from you guys and how much you tweet. it's still the service where people who make the news get

their news. they're doing great there. we need to get our moms and dads on there as well. >> we do it for free. that is part of the problem. evan thanks for your time. good weekend to you. up next, take a look at what some of the stocks are doing, continuing to sell off. all major averages down close to 2%. amazon and google down more than 3%. for example apple almost 4, we're back in a moment. whether , ♪ 800,000 hours of supercomputing time, 3 million lines of code, 40,000 sets of eyes, or a million sleepless nights. whether it's building the world's most advanced satellite, the space station, or the next leap in unmanned systems. at boeing, one thing never changes. our passion to make it real. ♪

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coming up, famed investor jim chainos is with us today. on china, emerging markets and more and investor paul meeks on what he's doing, especially with tech getting slammed. with oil barely hanging on to the $40 level, is 20 the next stop? jon, so much to talk about, top of the hour, see you in about 15. looking forward to it. one of the market's biggest winners meanwhile is becoming one of its biggest losers. in short-term. apple down 18% from the all-time high in april. not getting a lot of love after a recent survey from baird indicating consumer was sooner buy a fitbit than an apple watch. joining us is the analyst behind that survey, will power. will, people are buying a lot of fitbits, their last report not too shabby, the apple watch had

been in short supply. it's not a huge revenue generator for apple. should people really be bearish on the stock because of the watch? >> no. i don't think so. there's tailwinds around fits in generally in the last survey, 22% of respondents said kaited they planned to purchase a fitness tracker. fitbit is leading the category bay wide margin and they've got a much broader selection of price points and devices and apple shows up pretty well in that survey. despite being at a higher price point. the ires for apple are around the iphone comps in the december quarter in china. those are the two factors, but we like the stock on this weakness. >> i guess in a way if you think that apple still has its mojo, if you're long the stock, pullback might not be too bad, including we got a lot of news from them. the biggest news of the year that always hits in september, and october. what's your feeling about the apple next iphone, which we

expect to be the 6 s, plus 6 s plus. we've had amazon on taking they've been taking share from samsung and others say they may not be able to sell as many iphones as last year. >> we had a separate iphone 6 s survey from last week and i thought the results were encouraging, interestingly the percentage of respondent who is planned to purchase a smartphone this year is down slightly from what we saw a year ago. as we looked at u.s. consumers, the percentage that plan to purchase an iphone went up from 43% and change to almost 49%. that really speaks to the recent share gains that apple has had. we expect the share gains to continue and in our sense there's still a lot of upgrade dpand in the space. apple talked about 27% of its space vp having upgraded. >> we like the 6 s opportunity and think they can continue to

grow off of tough comps as we go into next year. >> will power from baird. not planning to buy watches, but planning to buy iphones. have a great weekend. >> we're watching apple in negative territory for the year. it's high was on april 28th, 134.54, pulling back yet again, 291 points. apple a big part of that. market solidly down below 1%. dow down about 1.75%. the gillette mach 3 turbo

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there will be a visit by the chinese premiere to washington in september. carl i would say in the arsenal of words available to the treasury secretary. these are rather subtle words, he could have said manipulation, he could have said troubling about ten days ago. they said they took a pass on judging the chinese move on the yuan, the devaluation there and ha was just saying they're closely monitoring it.

obviously some are concerned about a currency war and there's talkers of concern in washington among representatives in the house and senate about chinese devaluation, carl? >> we did have a discussion this morning about where and when that rhetoric would begin on either side so thank you for that. steve liesman talking about the statements from the treasury secretary. we continue to hover just below the 2000 level on the s&p. interestingly the vix setting new highs for the year. and one of the biggest monthly gains going back to 1990, the 10-year has finally started to move, giving into some of the selling. we started the morning around 2.07, now around 2.04, 2.05. in determines of 300-point losses on the dow, we've not had back-to-back 300-point losses since november of 2008. which the thick of the financial crisis. joining us today, brian jacobsen, a chief portfolio strategist at wells fargo. brian, good morning to you. >> good morning the it's been

pointed out virtually nothing is helping today. there's waves of negativity from desk to desk. whether you work on 4-x, whether you're covering geopolitics what to you are the most important themes right now? >> well right now i think we're just in a pessimism loop unfortunately. where there is a lot of negativity and there's reason to be somewhat negative about some of the information coming out of say tension between north korea and south korea, you also have political issues and in south america, obviously the slowdown in china has everybody's attention. so there's plenty of things that you can fixate on that can make you negative. i think this is where it's important for investors to really assess what's their time horizon with a lot of their investments. i've been encouraging people to look at getting more into emerging markets as the market has come down. that does require you to be very patient. having an investment horizon from 18 months to three years,

as opposed to three days to three months. >> how much does the pivgt complicate the story of economic strength in the u.s. recently the data were moving in the right direction for the fed. >> it was, yeah, it seemed like the fed was getting closer and closer to the september lift-off. and i believe they will lift in september because we have a lot of data to come between now and their next meeting. the problem is that when it comes to parsing what the fed has been saying, i think that it's actually important to recognize in the minutes what they were talking about as far as the concerns as it relates to international developments was more on the outlook for inflation and not for economic growth. not to say that the united states is any sort of you know island on its own where it can just be kind of sitting here growing without the world growing along with it. but it's more on the inflation front that i think the threat, fed is worried about. and not so much on the growth front that has them concerned. >> all right. brian, i'm just wondering, i

mean what's a reasonable amount of cash right here in your view? >> well it depends on what your cash needs are over the next say six months to 12 months. i encourage people to follow a pattern where they try to keep enough cash such that they can ride out market volatility that can last anywhere from six months to a year. not many americans are in that position where they can do so. for those people who are higher net worth, that's about what sort of balance i would be looking at. most of our portfolio managers have been a lot more cautious going into this turmoil. so this is actually i think more of a buying opportunity. and an opportunity to be deploying that cash as opposed to being hoarding that cash. we will see about that. >> obviously a lot of people in other camp was disagree. but thanks for your time, brian jacobsen from wells fargo joining us today. oil about 15 cents from a 3 handle. down almost 300 points, slightly off of session lows, more on

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weemplts haven't had a 1 handle on the 10-year since 2008. we're not far away since we're seeing the yield below 2.05, we mentioned the vix a lot of concerns about volatility creeping into the market in a hurry. >> safe to say risk is officially off especially with some of the haef-haven trades, the 10-year working well. all the pundit who is said the 10-year going back to 2% before it goes to 3% are probably cashing in at this moment. look at gold, very interesting on pace for the biggest weekly gain in gold since january. so certainly a lot of money going into the gold complex as well. >> on the heels of the salesforce earnings which has the stock up a couple of percent. you might have hoped that

workday and box would be up but they're both down. no follow-on effects. >> tied for the worst s&per of the week -- netflix. 15% unbelievable. that does it for "squawk alley," chanos is with the judge, let's get back to headquarters. welcome to the hoix shalfti show. the picture not pretty for the long u.s. equities today. the selling continuing again, the dow down it its lowest level since october. 85% of energy from a bear market of recent highs. 43% of the materials, 35% of tech and the list goes on. the damage far and wide and much of it far from home. china and the emerging markets remain in turmoil. serious questions about currencies and con tajing which leads us to our speci