1%. all ten sectors are in red. they're turning green so we're watching a change. >> a tumultuous week for retailers, in particular. >> thanks for watching "power lunch." have a great weekend. >> "closing bell" starts right now. hi, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. stocks ticking a leg lower in the last couple hours of trading. it's not the skegsary weighing on the markets. financials and staples are getting hard hit. we'll see if the market can come back in this final hour, which is an options expiration date, by the way. >> that's true. meanwhile, watching apple make a $1 billion investment in the china's company like uber. meanwhile, donald trump takes a swipe at amazon ceo jeff

bazos. chairs of intrexon down. the company ceo will join us live to respond on the back of their earnings, too. that's coming up. let's get to what's behind this selloff. mike santolli joins us. >> there was nothing too specific in terms of news but all day the markets traded a bit heavy. i think you want to point to the flattening of the treasury yield curve. rick santelli has been talking about all day. two-year yield is up. longer terms are down. that's a slow growth signal. also a signal the market is sniffing out the strong retail sales data along with the good jolt of employment data this week maybe puts the fed back in play. fed speakers have been trying to focus the market on two more fed rate hikes later this year. meantime, the market doesn't feel as though the growth picture is all that strong.

maybe that's what we can infer. that's hurting financials. you mentioned, bill, the staples were one of the losing groups today. that's an overbought sector. people have been piling in. i would point out, too, you have walmart in there. walmart is one of the weakest components of the dow. that actually is a quaucy retail play also being dragged down with the other chain retailers. >> even as we're hearing, mike, walmart could be the one to take amazon. do a buildout of its own distribution network and charge people that 49 bucks a year or whatever. >> everybody is back to the whiteboard here on what to do. and it seems as if the market's just not that comfortable in banking on these profit pools anywhere in retail, except for amazon, which seems to kill profit pool. that's been the rule. i actually thought there would be a bit of a rally attention in some of those core mall retail type names today. mostly because the xrt, that etf that follows those stocks, down

15% this week alone. >> wow. thank you. jcpenney was the latest retailer to report disappointing results but the federal government says retail sales grew faster than expected. courtney reagan, what's going on? >> the thing about retail, it's a crowded, competitive space. it's two-thirds of the gdp. just because department stores aren't ringing up stellar sales at register doesn't mean consumers aren't spending at all. april posted the biggest increase in more than a year, 1.3% higher than last month. the strongest categories, autos, gasoline and nonstore retailers. that, of course, is where amazon falls. weakest categories, general merchandise, which includes department stores, only up 0.3%. food and services, drinking places and sporting goods all a little weaker. now, the differences do seem to match what jcpenney ceo marvin ellison told me on the phone, employees feel good about their situation, savings are better,

wages are improving for consumers, and these customers feel good about the future. the challenge is there's a shift happening in preferences. don't forget, too, the department store doldrums have a lot to do with prices. goods have been getting cheaper for some time. and in march the bureau of economic analysis price index showed general retail prices declined 3.2% from a year ago. a point that was a big theme for retail earnings in week. many forced to mark down inventory. good for consumers who are spending, bad for retailers' bottom lines. >> what a week it's been for those retailers. >> you can say that again. >> thanks. breaking news right now on general motors. phil lebeau stepping in with that. >> this is a wire from reuters getting a little attention and for good reason concerning fl economy. general smoerts stopping the delivery of three 2006 models, about 59,000 of those vehicles at dealerships that cannot be

delivered to customers because the fuel economy stickers on those windows overstated the fuel economy. this is not a case similar to volkswagen. in is more a clir cal type issue where the stickers on the window overstate by one to two miles per gallon the fuel economy for these models, acadia, traverse. they incorrectly state fuel economy so, as a result, dealers cannot deliver them to customers. they expect this to be clarified and cleaned up next week when they hope to be delivering those vehicles. will get some attention given everybody's hypersensitivity about fuel economy. >> do we know how this was discovered, phil? >> not entirely clear, kelly. not surprising when you have the volume of vehicles coming out from auto manufacturers that occasionally you'll have this happen. general motors is sending the correct stickers with correct fuel economy so they can then deliver the vehicles. >> they have to get those razor blades out and get the old stickers off the window.

buy razor blade makers. thanks very much, phil. let's get to our "closing bell" exchange for this friday with the dow down 171 points. wey cnbc contributor michael farr from washington back with us. kenny from o'neill securities is at post nine and rick santelli checks in from chicago. kenny, today reminds me of tuesday in reverse. tuesday we had a big rally. guys are looking at each other, scratching their heads, couldn't figure out why the market was rally. when i got to the exchange, the same thing was happening. we were saying, why did the market sell off so much? you can point to a million reasons but no single reason apparently, right? >> i really think -- i think today is exhaustion and we've prone the technical level. 2054 is the 50-day moving average on the s&p. we're significant reply below that. it feels heavy. volumes are lighter. we've only traded 570 million shares. it's already ten after 3:00. it's not going to be a heavy

volume day -- you'll get volume at the end of the day because of the option expiration bought the trading volume during the day has been relatively light. it doesn't feel like there's any reason for anyone to rush out and buy stock. the market feels heavy. it felt heavy. it feels like it wants to go lower. i wouldn't be surprised now if over the course of the next week or so we test 200 down at 2015, especially if you start hearing hawkish comments from the fed. >> michael farr, what do you think is going on with the consumer here? >> i think the consumer is probably doing a little better than people think. while the sort of brick and mortar retailers have not had very good numbers, we're seeing a profound shift, i think a structural shift, to online commerce and e-commerce. and morgan stanley came out with a report that said, we're going to see -- i guess apparel right now is 7% of amazon sales. it's going to go to 20%. so, we're going to see more people do more on the internet. and there's a whole lot of brick and mortar still paying leases out there, divisional retailers in trouble. just because you see bad retail

numbers doesn't mean bad consumer. the consumer is still coming in with more jobs and continuing to spend, all be it weakly, but continuing to spend. >> i was joking if we could buy gasoline online we would. it's such a bother to go to the station and fill it up. >> we used to buy our razor blades online. >> rick, some after the retail sales numbers said june, maybe, june is on the table for the feds. do you think the markets are setting up for that at all? >> i see a nervousness that shows up in the yield ksh curve. we have charts. for a while it wasn't close we were going to take out the february low, but we did. hovering around a differential of 95. it's the tightest, narrowest, flattest it's been since christmas of 2007. why do i bring that up? because i think it epitomizes every time you get some strong

data, the curve tends to flatten. because short maturities closely reflect what you're asking. the fact of the matter is twos are unchanged on the week, virtually unchanged on the day. the long end is down about eight bases points on the week. so, when you get a flattening curve after strong data, where all the maturities are basically lower yields on the day, that tells me it's a weak dynamic. the stronger dynamic, in my opinion, is two or three-fold. the long end doesn't believe the sustainability to the pattern we see. you see weak quarters, strong quarters and over four quarters it usually comes out a little below 2%. i think the market has it figured out with all the ka buicky that comes back with bringing the fed back. maybe the biggest issue is derivative trade value. these negative rates make everything with a positive rate look good. i think that's pressuring the long-end yield and making corporates as hot a red light

corporate security as you can find. >> some dividend yielding bonds, right, kenny? i mean dividend yielding stocks. >> right. i think as we move into the end of the day, it still feels haef, like we're going weaker. i agree with that -- i agree with what rick says. as long as this hawkish commentary coming out of the fed, then you can expect the market's going to reprice some of these assets and have you to look for the market to get a little weaker. i don't think it will crash but i wouldn't be surprised if we get waeshg into next week. >> a light volume day coming in on a down day on a friday, isn't that usually a don't worry too much? i mean, if volume were picking up in this downturn, you would rely, but right now doesn't it feel like a nothing burger? >> yes. but it still feels heavy. listen,ist friday going into the weekend. there's no reason to buy them. a lot can happen over the weekend. i think you have to reassess next week. i think the next couple weeks are going to depend on what we hear out of the fed.

>> we have to go, guys. good to see you all. michael, come back when you can stay longer some time. >> thank you, sir. >> see you later. have a good weekend. let's talk about this story, apple making this $1 billion investment in a company called didi. what they're calling the uber of china. i think it's more than that. susan lee plains what didi is what it means for apple's future. >> didi chuxing means hong kong commute literally in chinese. they have 99% market share when it comes to taxi hailing, 99% when it comes to private car hailing and they operate in over 400 cities in china. you compare that with uber which operates in 45 to 50 cities in china and anyone that's ever traveled to the mainland, they know that didi chuxing reigning supreme. they also let you book buses. they have this innovative service called hitch which allows to you book a chauffer.

so you can book a designated driver to you, which will take you and your car safely home. now, if you're wondering who's behind didi chuxing, we have l alibaba, and jean liu, la nova's founder, and they haven't had a problem when it comes to raising money because ten cents alibaba, two of the largest tech giants in china were some of the early backers. now this company is valued at over $20 billion, coming from $6 billion just in february last year. so, they've come a long way. they have a lot of cash on the balance sheets. about $3 billion at the end of 2015. makes it one of the most -- top five most valuable tech startups in the world. not just in china. when we talk about profitability and financials, didi, of course, they haven't been so forthcoming in terms of how much they're making but they say they are closer than ever to profitability and, in fact, they

are making money in over half of the cities they currently operate in. and they spent some of that money recently. just about $100 million to get into this global alliance with lyft, ola, rap taxle of course to rival uber. >> we wonder how these sides are shaping up, how are they taking shape globally? let's bring jon into the conversation. you know, travis -- >> apple is investing in lyft. what's going on here? >> first of all, the folks at didi are incredibly smart. also the people at grab. what's happening here is a grab not just for this ride-hailing market. what we think of it as here in the u.s. in china, throughout southeast asia even, some of what's happening with these apps is

kind of the remaking of public transportation and the remaking of the commuting experience. it's one of the most important things people do with their smartphones. you look at apple looking to grow in china, looking to grow in a lot of markets, they get called emerging over here. partnering with these particular entrepreneurs, the way that people who are driving thoost these services are paying for things and getting paid. that's an area apple wants to be in as they try to move into mid-tier smartphones, as they move into payments with apple pay and services like that. >> the first thing i thought when i heard about this was that this was one way apple could use some of that money -- the cash they have stranded overseas and put it to work. what you seem to be suggesting is there's an intention here to bring this company, didi, into the apple ecosphere, right? >> i think there's some of that and the desire for apple to get into didi's ecosystem as well.

apple has huns of billions of dollars strand outside the u.s. they also have to be careful because apple wants to be a platform company. as you make these alliances, you also make economies. look how they are feeling about apple partnering up with didi. it's not to say apple wants to do a lot of these because they could end up alienating important partners and they only have so much attention they can give to various industries, but this is one that could be said to make a lot of sense because it's china, because of who the entrepreneurs are and because the way the mobile economy is developing in places like china and throughout southeast asia. >> the other question i this is why does didi even need this investment? they already have -- you said 99% of the taxi-hailing business. they have tremendous market share. they're already very successful. >> very successful. when asked last night on a pretty private conference call with jean lichlt e, the president of didi, if they had

international ambitions. she said every company should. we do. but right now we're focused on chinese consumers going outside china. they still want to operate in more china cities. they want to grab more market inside the borders. >> if you opened didi as a user into the u.s. takes them into lyft's service. we'll see how these line shakes out. heading to the close, 44 minutes left in the trading session here with the dow industrials down 174, was down almost 190 at one time in a late-day selloff that people are still wondering about. s&p is down 17.5 and nasdaq down 21. likely republican presidential nominee blasting amazon ceo, saying the company has a huge anti-trust problem. we'll debate next whether he's right considering amazon is dominating retail and some other industries, too. plus, intrexon shares have

plunged more than 30% since a report called it the theranos of the public markets. coming up intrexon ceo will be here to defend his company and claims using mutant mosquitos to fight zika really does work, despite the naysayers. coming up.

about 40 minutes left. market still coming off the lows of the session. the dow down 167 after having been down about 190 an hour ago. the s&p is down 16. the nasdaq down 17. did i say it was expiration day? it's not. >> so those comments expired. >> i had bad calendar information. >> chip maker defying the markets. thanks to strong demand for its gaming graphics chips. and so you shall -- >> that's the story on nvidia. presidential candidate donald trump going after amazon and jeff bezos last night over alleged anti-trust issues and

bezos separate ownership of "the washington post." listen. >> this is owned as a toy by jeff bezos who controls amazon. amazon is getting away with murder taxwise. he's using "the washington post" as power so the politicians don't tax amazon like they should be taxed. he's worried about me. i think he said that to somebody, it was in some article, where he thinks i would go after him for anti-trust because he has a huge anti-trust problem because he's controlling so much. amazon is controlling so much of what they're doing. >> well, we reached out to amazon for comment but have yet to hear back. does trump have a case here? joining us is andrew stoltman at post nine along with scott blum, also the former general counsel of the u.s. senate's anti-trust subcommittee. welcome, guys. you know, what's the anti-trust case here against amazon, andrew? >> i think the anti-trust case has to do with the fact that amazon is an 800-pound gorilla,

and they have done things in the past that at least raise an endicia of anti-competitor products. they secured diapers.com, zappos.com and those companies. european regulatories have started investigating because of the book sales issued. >> they bought zapos, right? >> they skewered them for a while. >> scott, you're not buying this, are you? >> first of all, it's seth. no i don't agree with that. so, what seems like donald trump has a problem with jeff bozos owning "the washington post" and some things "the washington post" has said but he hasn't articulated any anti-trust complaint. i mean, anti-trust law is big is not bad. there's not a problem with a company that grows big and a large market share as long as it doesn't engage in illegal conduct. amazon has become a very

efficient producer and have delivered many benefits to consumers. that's what really is the test here, is whether the conduct of amazon is benefiting or harming consumers. and i haven't heard anything about how amazon is harming consumers. >> look, i feel like i'm in a bizarro world. have you a republican candidate raising anti-trust concerns and he hasn't provided any details to us. all i'm saying is when you have a company this big that controls that segment of the market, that's problematic. i know there are a lot of competitors out there, so that kind of allays some of those concerns. >> i mean -- >> but amazon shouldn't take these statements from donald trump so lightly, because once you get the doj, once you get the ftc looking at you, there could potentially be problems. >> the doj and ftc have well-developed standards over a century of anti-trust law precedent to determine whether or not there can be a claim made against the company. as i said before, merely because a company is large and has a large market share does not

necessarily mean it's a violator of anti-trust law. one thing, for example, amazon was accused by apple and book publishers of trying to monopolize the book market. those allegations fell short. and the reason was for millions of consumers the price of books has decreased. it's more convenient consumers don't have to go to the bookstore. they can look on their computer and get books delivered to them. have you to look about whether or not there is really an anti-trust concern. that depends on whether or not consumers are being harmed. certainly large companies can engage in conduct that's in violation of anti-trust law. we have to have some allegation of conduct. not simply just throwing out accusations against amazon, which i think is motivated by mr. trump's differences with mr. bezos rather than any real anti-trust -- >> european consumers have made these allegations.

i'm not saying anything is go to happen to amazon. all i'm saying is if trump is this serious about this issue, i'd be a little concerned if i was amazon. >> i'd be concerned if i was business. thank you, guys. >> andrew stoltmann and seth bloom, thank you for joining us. bridgewater's 13-f filing and kate kelly could not be more excited about this. she has details. >> you got it. i'm super excited. this is one of the largest -- i think it's one of the largest hedge funds out there with a number of changes. a few things i want to point out to everybody. number one, they have increased by a small margin, nonetheless, a huge position in a merging markets. this is the vanguard ftse emerging markets etf. now around 35 million shares. they also have made moves in the retail sector which has been really beaten down in the last month or two as part of a broad downdraft in consumer discretionary holdings. in terms of bed bath and beyond

they lowered their stake but in macy's they raised their shares. pepsi, they're essentially dialing that back almost to nothing from about 300,000 shares to 55,000. that's a parallel move, i might add, to what we saw a short time around from trian partners which is out of its pepsico position after a lucrative three-year holding position and activism that didn't play out as planned but led to nice returns. bridgewater cut their stake in apple from 327,000 shares to about 106,000 shares. some interesting themes on the consumer side as well as that emerging markets holding, which remains an important one, bill and kelly. >> that's true. thank you, kate. we appreciate it. kate kelly there. we expect to get a lot more of these filings going into the weekend. a little more than 30 minutes to go in the session. dow down about 172 points. transports are off 106 and nasdaq is down 18. a recent report says intrexon and zika virus cure may

not be all its cracked up to be. when we come back, ceo randal kirk will join us exclusively to fight those accusations, among others. and facebook ceo mark zuckerberg denying social news bias. larry kudlow weighs in on whether facebook is really politically neutral or whether it even has to be. stay tuned. [ soft music ]

e.t. phone home. when you find something you love, you can never get enough of it. change the way you experience tv with xfinity x1. . just about 30 minutes left in the trading session with the

dow down about 180 points right now. midday, market just sold off, about 1:00 eastern time when we started to see the selling intensify as we head toward the close. the s&p is down 17 right now. and the nasdaq down 19 points. freeport shares getting hit hard as well after agreeing to cancel two drilling rig contracts with noble drilling at a cost of $600 million. freeport will likely have to issue a secondary offering to pay noble for that cancellation. freeport down over 6% in today's trading. meantime, we have a news alert on alibaba. seema mody has details. >> let's take a look at shares of alibaba. an anti-counterfeiting group is reportedly suspending alibaba's membership after some retail companies have voiced concerns over the chinese e-commerce goods as being fake or counterfeit, in addition to the national anti-counterfeiting

coalition telling members it failed to tell the boards of conflicts of interest involving their president who had close ties with an alibaba executive. in november u.s. trade officials warned alibaba about counterfeit goods. we'll see if today's news brings that larger story or concern backed to table. right now we're looking at shares down 2.3% on the day. >> thank you very much. time now for a cnbc news update with courtney reagan. >> good afternoon, bill. here's what's happening at this hour. russian president putin describing the development of na nato's missile defense program as a threat to global security and vowed russia will take the necessary steps to maintain a strategic parody. he spoke at a meeting with military officials in sochi as senior polish and u.s. officials broke ground at a site in poland that will host interceptors for u.s. missile defense system. poland has been seeking nato and u.s. troops presence on their territory because of increased

activity by russia. a second day in court for a baltimore officer who is facing charges in the death of freddie gray. edward opting for a trial before a judge and not a full jury. his attorney said he did not arrest gray. a florida woman is learning to drive again after two decades of being blind. during spinal surgery 23 years ago, mary ann franco had a stroke and lost her sight. recently she had another spinal surgery, but this time when she woke up, she could see. doctors think an artery in her spine may have been realigned. that's amazing. that's your cnbc news update this hour. for now, back to you. >> unbelievable. >> isn't that awesome? >> you choose, i guess, not to dwell on the lost 23 years, she got her sight back, at least, but my goodness, what in the world happened to cause that to begin in-w in the beginning? we'll take a break. we're into the last half hour of trade with the dow down 180 points. officials confirming the first

case of zika in a fetus in puerto rico today. coming up, we'll hear from the ceo of intrexon about his fight against that virus and he'll also advocate for his cure. plus, just how safe is the global banking system now that thieves have pulled off another major cyber bank heist? that's coming up later on the "closing bell." trade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade. we built our factories here because of a huge natural resource. not the land. the water. or power sources.

it's the people. american workers. they build world-class products. and that builds communities. and a better future. for all of us. because making something in america means so much, to so many. weathertech. proudly made in america. ...of fixodent plus adhesives. they help your denture hold strong more like natural teeth. and you can eat even tough food. fixodent. strong more like natural teeth. fixodent and forget it. you wouldn't order szechuan without checking the spice level. it really opens the passages. waiter. water. so why would you invest without checking brokercheck? check your broker with brokercheck.

(male #1) rock crawling is a great activity. it's a lot of fun. -it's exciting. -it's exciting. (male #1) you get to explore, you get to see things that people don't get to see or do. (announcer) at truecar, we believe buying a car should be as fun as driving one, so we'll help you find the car you want and show you what others paid for it. (male #2) once truecar came into the picture, that's--that's where i go now. it was just such a quick, easy experience that i just go back to them.

(announcer) discover for yourself how easy car-buying can be with truecar. welcome back. a pretty broad selloff across wall street. the dow down exactly 1%, 176 points. all averages under pressure, bill. >> kelly, thank you very much. we're going into the last half hour. we have mike from rosenblatt securities with me here today. i've heard many, many reasons why we saw this selloff today. what's your version? >> i'm not sure what other people have been telling you, but i think it's a bunch of things. risk off, the move in gold and silver of late. i think a little bit of what's been happening in some of the retail names, apple and suppliers there. i think a little uncertainty on the political front. then you also have brazil and brexa. >> do you buy the notion that

the stronger than expected retail sales could put the june fed meeting back on the table again? >> you know, the fed's kind of boxed in here a little, bill. have you negative rates in some developed countries. you have a policy that really isn't providing any dividends, to speak of, in terms of some of the inflation numbers, some other things they're looking for. i think people are a little concerned about what the fed can and can't do and how well it's working. i think that's part of what you're seeing here in terms of the uncertainty. mixes up a little bit but not that much. eventually you get to a buying opportunity and sell off. >> just not there for you. speaking of buying opportunities, kelly, gordon bought this tion line. he's very proud of it. >> i was waiting for the tie harassment this afternoon. >> very nice. >> didn't disappoint. >> thank you. >> thank you, guys. a little more than 20 minutes to go. keeping an eye on markets, the retail sales number this morning was strong, but you can see here the fallout. biotech company intrexon reported nearly a $65 million loss earlier this week.

up next, we'll talk to the company ceo about it and its controversial zika program. also still ahead, a facebook face-off. republicans up in arms over a report the social media giant suppresses conservative stories. two political vets, larry kudlow and jimmy williams will scare off on the internet flack. stay tuned. lligent one. ♪ the all-new audi a4, with available virtual cockpit. ♪

igoing to clean betteran electthan a manual. was he said sure...but don't get just any one. get one inspired by dentists, with a round brush head. go pro with oral-b. oral-b's rounded brush head cups your teeth to break up plaque and rotates to sweep it away. and oral-b delivers a clinically proven superior clean versus sonicare diamondclean. my mouth feels super clean! oral-b. know you're getting a superior clean. i'm never going back to a manual brush. technology moves faster than ever. the all-new audi a4, with apple carplay integration.

right now on the industrial average. and it's the hardest hit of the major averages. the s&p is down 16 and the nasdaq is down 15 points as traders look around, trying to figure out why. but, you know, you can find plenty of reasons. it's just the timing of the selloff when it happened. if it was going to happen maybe on the open this morning, you could point to all the retail problems that have been going on. >> and that move in the ten-year, too, that keeps sliding lower. you can see the impact on financials here. and there are shares of intrexon down nearly 3% today. they've dropped nearly close to 36% since a short-seller put out a report questioning zika, the virus cure and it's business model. >> ceo r.j. kirk has come to his company's defense countering the

claims. right now on a cnbc exclusive we're joined by r.j. kirk. thank you for joining us again, sir. >> thank you for having me. >> you find yourself pretty much in the same position that elizabeth holmes at theranos found herself in, where people are calling into question the business model, the products, the results, the promises and everything. what is your strategy to counter the naysayers right now? >> we have a wonderful business that is operating under an extremely capital-efficient plan. we have many, many successes. we have mature products. we have market-ready products. we have products approved by the usda, health canada, endorsed by world health organization, panama health organization, et cetera, et cetera. when you say investors, so as you know, there are a number of short-selling hedge funds who -- and the report you just alluded to, by the way, was an anonymous

blog. >> right. >> by a self-identified short hedge fund. and we've responded publicly, i think, in the best way we know how. in terms of our overall response, we're going to continue to operate our marvelous business. so, i'm not -- i'm not concerned about that. we've got extremely healthy balance sheet. i don't even get the comparison you're talking about. >> well -- >> i read it this morning. i read it this morning, so let me tell you a little about this particular blogger who made this comparison this morning. >> well, you know what, i get the countering of an anonymous blogger. that i get. but let's talk about analysts on wall street who question -- read a report today by an analyst who has a neutral rating on your company. and he admits, he's still trying to get his arms around the business model. you have so many partnerships, you have licensing agreements, have you so many deals going on with other companies that ha

have -- that are outside the confines of your own specific company that he's still trying to model the business and figure out exactly where all the money's going to come from for your business. so, it's not just an anonymous blogger. you've got some legitimate wall street analysts -- >> no that's not the same point. that's a legitimate point. i can understand people who have the job of reporting to investors what our shares are worth on a discounted cash flow basis. internally it's, frankly, it's a pretty complex task for us, too. we do that. you're right. we have -- i think we have over three dozen partnerships. these are with firms like johnson ampbdz johnson, merck, sun pharmaceutical industries, which is the largest drug company in india, and i can understand how it would be difficult for an analyst to calculate those and deliver a discounted cash flow, especially since many of our projects are

so explosive in terms of valuation upon success. and it will be a while before we can show you that we have succeeded. for example, we have a meth methanotropic, we have a bacteria which consumes gas and translates to isobutanol. >> i'm glad you mentioned that. >> there are a couple of explosive things under way here, the gas-to-liquid bioconversion being one of them, and zika, the headline, obviously, for your company very frequently. but on both of those projects, how close are we to commercialization? >> well, as you -- as you probably know, we have a temporary registration, an approval in brazil right now. we announced last week that we are commencing a program to eradicate the aedes aegypti from the cayman islands, which

certainly changed my caribbean vacation plans, as in i'll be going to caymans. i think it will change the travel plans of many people. and so, actually, that lead -- the lead insect we have off of our oxitec platform is ready to go. it's ready to employ. in fact, this has been field-tested for over ten years. >> the feds -- >> over 100 -- >> no, no, the technology we're aware of. but how close are we to commercialization, getting through the regulators on this? >> it depends on which country. so, i spent the last several days in washington. and i -- as i mentioned the other day on our conference call, as compared with any previous time, i'm actually very, very excited that the u.s. agency people, administration, legislators and so forth are really starting to coalesce now

around the need for vector control. they understand, yes, it's zika, but it's also denghy, yellow fever. i don't know if you're aware of this but there's a sudden spike of yellow fever in africa. with the aedes aegypti footprint now covering 2.6 billion people. we could have a very, very dire situation of yellow fever soon. so, we can deal -- >> even if the u.s. doesn't let do you it in florida, you're saying there could be a lot of emerging markets where you'd have more success being able to go forward with this technology. what about -- >> i was actually saying -- yeah, i was actually saying more than that. i'm saying i'm now very sang win we will have approval in the u.s., eventually, because i see that the leadership in the u.s. is coalescing around the idea, both in general, that we need -- really need to eliminate or at least vastly reduce the population of the aedes aegypti mosquito. and i think they're really starting to get our technology, which, as i said, is

demonstrated over multiple field trials, over ten years. it's reported in over 100 journal articles in scientific peer-reviewed publications. it has no impact on the environment. it doesn't impact any other species we've been able to identify. it's extremely effective. we normally show knockdown rates of 96% to 97%. the short answer to your question s we're ready to go now. we're ready to deploy. >> we haven't even mentioned the potential here for ziro farm and and -- >> this year -- >> thank you. >> thank you very much. >> did you want to finish that thought? >> i was going to say, yes, since you mentioned health, this year we'll have seven different advanced cell and gene therapies in human clinical trials. so, we're very excited. >> r.j. kirk, thanks for joining us. >> thank you, sir. appreciate is it. >> ceo of intrexon. let's go to the break. we have 12:30 left, or thereabouts, with the dow down 182 points.

>> marco, the co-founder and chief investment officer of highland capital management says there's one thing moving the market right now and he'll tell you what that is right after the break. nothing unleashes power... quite like the human foot. introducing the 241 horsepower lexus is 200 turbo. with almost twenty percent more base horsepower. once driven, there's no going back.

e*trade is all about seizing opportunity. and i'd like to... cut. thank you, we'll call you. evening, film noir, smoke, atmosphere... bob... you're a young farmhand and e*trade is your cow. milk it. e*trade is all about seizing opportunity. sign up at etrade.com and get up to six hundred dollars.

coming up on the last eight minutes of trade here, he should mention art cashin just told me $300 million to sell. it was a lot more than that earlier on but it's starting to pair off as we head to the close with the dow town. joining us mark okada from highland capital management and the invisible hand moving the markets here lately n your view, is the dollar, right? >> absolutely, absolutely. you know, one of the things about the dollar and currencies in general is they're big markets. it's a little hard to manipulate them. it makes them kind of good signals to focus on. this dollar that we've seen for the last 17 months has been in this tight range between 93 and 100. we bounced off that 93. >> we went below it. it was weak all of a sudden. >> right. we bounced back. we're up closer to 95 now. as that moves up, that will put pressure on a lot of things, stocks, oil, earnings. >> what are the scene air he yoes if the dollar keeps

weakening or holding steady or weakening? >> if the dollar weakens, if it could get out of this band it's been, if it could break through 93, i think we have a bullish outlook. have you something to change the dialogue. the dialogue is sort of like, well, earnings are bad. there's no revenue growth. we've got this inventory problem. so, if we change the dialogue by saying, hey, the dollar's weaker, that means earnings can grow. we can get multiple expansion. that would be a bullish sign. not really happening. we've got to wash thatch that. if goes the other way, i think we'll have issues with the market. >> something the feds are cognizant of right now. if they're not raising rates, chances are the dollar is going lower, right? >> they're kind of stuck, right? because today's retail sales and consumer confidence, you can't tell me they haven't met their mandates. we have full employment. we've got a lot of wage pressure

building up. you have to be early with inflation. the fed is a little stuck by the dollar. if they start to raise rates, dollar goes higher. that's a problem. if they are on old, the dollar goes lower. now you have inflation on the other side. i think the fed's kind of in a tough spot, really, from here. but if i had to guess, malt m ultimately they care about the markets. they care about their mandate. >> what does that mean for if they start to go, how do china, europe, japan, how does that ripple through? >> the u.s. is the growth meter for the world. if our economy is doing well, i think that pulls everybody else up. my view has always been this slowdown we have overseas is really a function of the fact that we haven't been able to get out of our escape philosophy. you know, you say, oh, if it doesn't kill you, makes you stronger. the problem with our economy is that it doesn't kill us, but it leaves you limping and weak and -- >> doesn't leave us stronger either. >> for many years. so f we can get out of it, that

would be great. i think it would be good for other economies, per se. >> back here, hpity the poor investor who has to put money to work in this environment. already it's considered the defensive stocks, the defensive trade, is very overcrowded right now. we all have figured this out. that's where everybody's gone, right? >> but -- >> so what do you do? >> a lot of those defensive trades are yield plays, right? yield is not a bad place to be, per se n a slow growth world. meaning, we can't really grow until we get through this path. either the fed has to go and then the -- yeah, the world doesn't blow up. and then the economy continue to be as resilient it as has been or we'll be stuck in this place. you'll have slower growth either scenario. i think that yield product, defensive plays, credit, obviously those are good places to be. we've seen a balance on credit. we've seen yields becoming more important for people. we'll see. i think we have to watch the

dollar. and i think for investors, right, that can be -- pay attention to that versus all the noise we've got. a lot of noise. that's a good signal to focus so. >> we'll do that. thanks, mark. >> good to see. >> you mark okada from highland investment capital. we'll be back with more noise. after the bell, retail was battered this week. next week more than half a dozen retailers will release their earnings led by walmart, home depot. can they turn around the earnings for the whole sector? you're watching cnbc, the first in business worldwide.

it takesbut stealing itd work to eaonly took a few days. female announcer: protect your money. find out if you're dealing with a registered investment professional at investor.gov. before you invest, investor.gov. [so i use quickbooks and run mye entire business from the cloud. i keep an eye on sales and expenses from anywhere. even down here in the dark i can still see we're having a great month. and celebrate accordingly. i run on quickbooks.that's how i own it.

e*trade is all about seizing opportunity. and i'd like to... cut. thank you, we'll call you. evening, film noir, smoke, atmosphere... bob... you're a young farmhand and e*trade is your cow. milk it. e*trade is all about seizing opportunity.

sign up at etrade.com and get up to six hundred dollars. got a minute left. volatility reigned in the market this week. bob pisani with me as we close things down on the countdown for friday. we had that rally tuesday, which was followed by the selloff on wednesday. and now today we've got the selloff. so, for the week we're down just over 1%. >> buyer strike today. no big loss in the middle of the day. don't have a lot of buying interest. prices just drop. big story for the week, of course, retailers' new lows. most of the big names, gap, nordstrom at new lows as well. another big story is the banks, bill, as the yields and the ten-year continue to move down a bit, banks have struggled. that's the other big story for the week. >> what a week it was.

thank you, bob. see you later. have a great weekend. the dow down 182 points on the close. stay tuned. more on retail as they celebrate their anniversary. stay tuned for the second hour of "closing bell" with kelly. have a great weekend, kelly. thank you, bill. welcome to "closing bell," everybody. i'm kelly evans. it was a down session across wall street but the dow was the hardest hit. down 185 points, more than 1%. the s&p was down about 17 points. closing around 2046. the nasdaq outperformed, down 19 points relatively speaking up. coming up, mark zuckerberg offering to meet with conservative leaders and releasing facebook's news guidelines after right-wing said news feeds are censored. we have pro-columnist mark

s santoli. "fast money" trader brian kelly joins the fray, too. thanks, brian. mike, seemed to be holding okay this morning and then things went south. >> it slowly took on water over the course of the day. not really anything to point to specifically. i think it's telling how the treasury market traded today. we have strong government retail sales number. it allayed some fears maybe the mall retailers had kicked up this week. but then also with the fed speak this week, people are still pointing to the market of maybe this intention of getting two more rate increases out there. you had this flattening of the yield curve, and traded heavily. once again, we traded through the flat line for the year. s&p 500 break-even for the year is 2043. went below it, went above it. net-net we're still sloging in this range. this range is still in place. toward the lower end but nothing has changed. >> transports have been especially weak.

it seems to change day to day as to which part of that index, but it's been a sign. >> yeah, you know, i think there was no reason to buy, no reason to sell. so, you kind of have this -- you know, nothing really going on. >> what about the retail sales? >> i think actually my takeaway is there are two big stories going on here. but they're secular stories. they're not day-to-day trading stories. those are retail and what i'll call the investment banking side of banking. meaning, those are two businesses that i think are real substantial changes undergoing. and the shift away from retail or traditional retail. to online stuff. and the struggles we'll continue to see. i think for some time on wall street because they can't come up with new ways to make money. i think a lot of the things that happen with lending club are indicative that they'll struggle to come up with new product areas, new ways of making money out of finance other than, you know, homing the yield curve, you know, that rates go up and you can make money on the net

margin. >> lending club is interesting because it was a marketplace lender depending on marketplace conditions which went south in february. you would think the bigger thing by comparison would be able to naf gate stuff like that, but to your point, where do they grow? >> i think it's a commodi commoditization story. across industries you have commoditization, certainly retail, the investment banking sector. you're seeing pressure on margins. i don't see any reason to stop that either in the retail industry or on wall street. >> just one more quick, you have these rolling collapses in these sectors. last summer it was media. the business model's broken. now you have physical retail. you also had specialty pharmaceuticals after valiant. had you this sense everybody in business is a little off-balance in terms of where their money is going to be made down the road. >> what about real estate, brian. it's about to get broken out of the financial part of the s&p 500. one of the fed speakers this week warned about some of the

valuations. this has been going on for years now and there's no sign of it slowing down because it seems like every time i read a headline, it's about a pension fund or someone putting more money into real estate. >> right. it will slow down when the credit is no longer available. when does it happen? it happens when a recession comes. in my view, that's probably some time in 2016. maybe pushed out to 2017. but at these -- you know, these these prices with real estate, if you want to go ahead and buy something, go for it. just don't do it with b.k.'s money. >> speaking of your money, b.k., we just spoke with mark okada about this. he said if the dollar weakens, buy stocks. if it doesn't, watch out. >> i think that's probably an easy way to boil it down. to me, it looks like the dollar is going higher. for all intents and purposes, the dollar last week on that weaker than expected jobs number should have fallen. it broke down technically and completely reversed. for me, the underlying bull trend in the dollar is continuing. it's probably resuming here.

and i think there's potential for us to go much higher in the dollar. >> it's weird, guys, that the dollar was up today and the treasury yield was falling. you could argue there two sides of a coin, but, you know, why do you think it was that yields weakened here after a strong retail -- >> it was not all yield. the two-year yield was up. that's more in tune with fed intentions. i'm not saying the market is all of a sudden on alert for some kind of move in june but it was on a net basis it was the kind of idea that maybe the fed's not going to be standing pat for the full year. >> maybe they should be on alert. not only is the fed not themselves, but warngs it could come, not necessarily from yellen, but every note after the retail sales, even to some extent the ppi was the consumer is strong and the -- >> well, i happen to believe the fed should move. but what's going on is not just, you know, the short end going up. you're really seeing a flattening of the curve. that means nobody believes in economic growth anymore. >> that's true.

>> people don't see growth. that's why people are piling into high dividend stocks or real estate. it's like, where can i get yields here? it will end badly, kelly. just a mention of when it ends badly. >> just in general, crude oil kind of hanging in there, above $45, comes an additive to inflation. it stops dragging on it. >> let's spend a moment on retail earnings. they have been disappointing across the board this week. next week we get more reports. courtney, should we be bracing ourselves for walmart, target and tj maxx? >> i think department stores will be happy to step out of the spotlight and make way for the box and specialty retailers reporting next week. consumers haven't been buying clothing. that's what we heard this week. but they have been investing in their homes. that should help home depot and lowe's. spring is the home improvement retailer's big season and wet weather may put a damper on outdoor merchandise. for target, sin vesters are

seeing if the retailer adds to six straight quarters of inkreection and six straight quarters of traffic improvement and if that line of onsaline sas grow. the largest retail reports on thursday. back in the fall you'll remember walmart announced big investments in it's e-commerce operations and subsequently warned that would depress profits for several years. investors are really going to want to see continued positive momentum in that key u.s. same-store sales metric although it's expected to grow just a half a percent. tjx expects and ross stores are out as well. nordstrom rack sales, up 4.6%, the opposite move of regular comp stores. after april sales reports, don't look for stellar numbers from l. brand or gap either.

today e-commerce showed weakness in sporting good. that could foreshadow losses for dick's sporting goods and foot locker. >> thank you so much. so, the interesting thing, too, in the retail sales this morning was building materials were a little weak. that's been an area of strength. >> they obviously have been on a good run. it was obviously nonstore retail, which was the star, up 2.2%, which was definitely dragging the whole number up. i don't think it gave you anything to be that concerned about if you don't happen to own the 3 or 4% of the s&p 500 that's directly exposed to people shopping. in physical stores. honestly, that's what it amounts to. >> thank god it's 3% or 4%. >> we talked before about traditionally if you go back ten years or so, people would look at new home builds or retail sales as the tale of what was going on in the economy. what you have going on right now is people are saving more money. maybe they're not buying more goods and churning through it more. i think you have changes in

consumer behavior patterns. i can't prove any of this. i'm going on the assumption that something is happening underneath so people are doing things differently than they did 1 10 or 15 years ago. >> do have you a view on amazon? >> no. it's a great company. they provide a great service. gou to the be in the stock that -- all it does is go up. it is one of those things where the net benefit -- >> like the ones that go down? >> the net beneficiary of all that's going on in retail is the end consumer. amazon -- the big beneficiaries are not -- it's not the dividends they're coughing up. they're not coughing any up. it's not in the profits. it's not generating huge profits. it's in the end user who is really benefiting. >> right, brian, that's a great theme? >> it's a great thing if you're jeff bezos, yeah, absolutely, because your stock price keeps going up. it is one of these things where we're in this market and you've got only a handful of stocks that are actually working. so, we can say we're a bull or bear market, doesn't matter. there's probably maybe a half

dozen stocks that are really working. amazon one of them. i'm not a guy who's going to be buying any stock at all-time highs, although i do see the potential in amazon. it's just my trading style is not to buy at all-time highs. >> last year, brian, we have to let you go, was fang. >> right. >> what is it this year? it's changed a little bit, right? >> it has. well, absolutely. i moon, i don't think netflix should be in fang anymore. google to some extent. facebook is still there. one thing i would say about those stocks, if you get any kind of a downturn, and today was actually terrible in the s&p 500, these stocks get hit hard. sometimes they get hit last. the last downturn they got absolutely crushed because everybody's in them. be careful in those. >> thank you, brian. we'll let you go. stick around to catch b.k. with the "fast money" crew coming up with the former ceo of jcpenney where he says he knows the nams that will break and which won't.

now the headlines with sue herera. >> according to "the new york times," which is running this story that says the pharmaceutical giant pfizer has announced it has imposed sweeping controls on the distribution of its products to ensure that none are used in lethal injection. that's a step that basically closes off the last remaining open market source of drugs used in executions. a number of other companies have done this stwl. as well. the pool of companies that would allow their drugs to be used in lethal executions has really shrunk dramatically. this has big implications for, obviously, the justice system. pfizer has now, basically, said their products will no longer be used in lethal injections. kelly, back to you. >> so, sue, if its pulling its products, does that leave a viable option or not? >> according to the source quoted in the "new york times," she says, and her name is mia foa, she trackings drug

companies for reprieve, a london-based human rights advocacy group. she says, quote, with pfizer's announcement, all fda-approved manufacturers of any potential execution drug have now blocked their sale for this purpose. executing states must now go underground if they want to get ahold of medicines used in lethal injections. so, in her opinion, it means they'll have to go underground. >> wow. huge implications for justice system. thank you, sue. sue herera. apple making a billion dollar bet on a ride-sharing service in china. we have someone who says apple should make more moves like this next. facebook is under pressure from conservatives after a former staffer says they were told to censor right-wing stories but mark zuckerberg is shooting down those claims. you're watching cnbc first in business worldwide. all across the state, the economy is growing, with creative new business incentives, and the lowest taxes in decades, attracting the talent and companies of tomorrow.

like in buffalo, where the largest solar gigafactory in the western hemisphere will soon energize the world. and in syracuse, where imagination is in production. let us help grow your company's tomorrow - today - at business.ny.gov the call just came in. she's about to arrive. and with her, a flood of potential patients. a deluge of digital records. x-rays, mris. all on account...of penelope. but with the help of at&t, and a network that scales up and down on-demand, this hospital can be ready. giving them the agility to be flexible & reliable. because no one knows & like at&t.

welcome back. uber may be taking on the world with its ride-sharing but now apple is taking a bite out of uber. the tech giant investing $1 billion in didi which rivals uber.

he writes, haggshakingmyhead. collin, your point is apple should be doing this all the time? >> it's all about the cash. we always hear apple has so much cash. $230 billion of cash but 90% of that is overseas. $209 billion of that is just sitting there, stagnant. they're not doing anything with it. the domestic cash they're using to buy back shares, to pay dividends, to do some local acquisitions, but that international cash is sitting there. so, when you look at apple and see it trading at ten times against the broader market at 19 times, it's because investors don't see enough forward growth opportunities. take that cash and deploy it. buy future growth opportunities. it's as simple as that. >> it actually makes sense. you have to scrutinize the exact

strategy behind every one of these things. to me using half a percent of your net cash, is really not a big deal. >> correct. >> to experiment and learn and see what this is all about. but the amount of speculation and the amount of really kind of complaint that a company -- anything apple ever does, $3 million for beach was no big deal and people freaked out about it. >> they freaked out because they didn't think they would get a good return on that investment. >> you think somehow it muddles up the purity of the apple ethos. that's what you're finding. >> you have to make that decision. maybe some people say, hey, you're not meant to be a holding company and you shouldn't make those investments. if they don't want to do that, fine. repatriot the cash. stop waiting for a tax holiday. pay the taxes and have that cash available for domestic return to shareholders. don't leave it sitting there. >> i understand that. >> a question an investor might ask -- there's no way they're going to find 200 other didi investments, right? >> they could probably find 50. >> i don't know.

that's a lot of billion dollar investments. maybe they can. let's wonder how many of them would be good investments. but put that aside. isn't tim cook's better time being spent maybe either developing new products or going to washington and cutting a deal to get the cash back to the shareholders through the u.s.? >> fine. but when are we going to get the next tax holiday? >> that's what i'm saying -- >> you have literally $209 billion. this deal -- >> you have $260 billion net of debt. they're going to issue more debt. >> they are. sdoe messticly cash poor. necessity are internationally cash rich. there are just -- even if you can't find 50, there are others out there. daily motion, right, you can invest more into india. you can get involved in, you know -- there's a whole range of things. you saw microsoft buy skype, cisco buy nds because it's the overseas cash and quite frankly, when you're using it, you're getting a discount. otherwise you're paying the tax on it. so, you're able to take more

risks with that money than just letting it sit there. repatriot it. don't just let it sit. >> you're no different than a sovereign wealth fund. if you're finding big, fat opportunities -- >> you're no different than a bank if you let it sit there. >> i'm agreeing. i'm just saying -- when you go, i have so much money, i just have to put it to work and you find an exotic places around the world, a place to put it to work, there's no underlying business case. you know, what is the business case? how do i get a return on the capital? and i don't think, you know, a glorified uber in china is really going to bring long-term value to the apple shareholders. >> the $163 billion they spent returning to shareholders domestically hasn't generated capital -- >> is there a possibility there's actually a business purpose here? this could be the first step to something they're interested in -- >> absolutely. >> -- doing in xhooin? >> absolutely. there are more cases like that. so, let's get out there and deploy some of that cash. let's just use 5% of it.

let's get more activity happening because the sense of apple is that the pace of decision-making is sluggish. >> maybe it's sluggish for a reason. have you to be careful when you're rushing into a lot of these things. what about the idea that it's for political capital in china? then you'd really have to wonder if that's a good investment. maybe it is. i don't know. >> and certainly there is ways to invest and get political capital in other countries that are supposedly their big growth areas, primarily india. make some mother investments along those lines in china. >> you're not worried all these investments are just going to be money thrown count tubes? that you're taking -- >> one-half of 1% of their cash balance? >> you're calling for an increase -- >> it's a seed. we need -- right now, if you think about it, apple trading literally at ten times, right, because investors are valuing a dollar that apple makes. they're saying, there's no forward growth. plant more seeds and you may get some multiple appreciation. there's no reason it shouldn't trade at least with the broader market. >> thank you for joining us.

>> happy friday. >> you, too. there's been another bank hack in addition to the $180 million stolen from a bangladesh bank. what it means to safety around the world. coming up, mark zuckerberg revealing facebook's news guidelines and plans to meet with conservative news makers. larry kudlow weighs in after this. there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here.

fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be. [ that's a good thing, eligible for medicare? but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they could save you in out-of-pocket medical costs. call today to request a free decision guide. with these types of plans, you'll be able to visit any doctor or hospital that accepts medicare patients... plus, there are no networks, and virtually no referrals needed. join the millions who have already enrolled

in the only medicare supplement insurance plans endorsed by aarp... and provided by unitedhealthcare insurance company, which has over 30 years of experience behind it. with all the good years ahead, look for the experience and commitment to go the distance with you. call now to request your free decision guide. ♪ [engine revs] ♪ ♪ [engine revving] the all-new audi a4 is here. welcome back. did they or didn't they? only facebook's trend team knows

for sure. the company under fire for allegedly steering its trending topics section away from conservative viewpoints and toward more liberal ones. what really has conservatives incensed is facebook has been denying it inspect last night mark zuckerberg said he'd invite conservatives and people across the spectrum to talk about this and share their points of view. joining us for their points of view, larry kudlow, cnbc senior contributor a long with jimmy williams, host of "decode d.c." welcome to you both. larry, i haven't heard yet, what do you think in terms of what facebook is doing. is this appropriate? should we expect this? do we care? >> well, we care. we care a whole lot because the power of facebook, what have they got, kelly, 1.5 billion viewers -- users? it's gigantic. the whole issue of the gatekeepers, the curators and who put up the hot topics list, which is very important, gives

them immense political power and gives moto's story -- they came out and said they talked to former curators, there was mischief, and they did keep conservative items and conservative people off the topics page. that's most curious. you're leading point, if it's not a problem, then why is mark zuckerberg suddenly calling for a meeting with conservative folks? by the way, did you hear his speech a month ago where he basically tore apart donald trump and his platform? so, i don't know for sure, kelly, but it sure is suspicious. >> what do you think, jimmy? >> i agree with larry on the first part. i do find this troubling, having started a major website, which i -- which i subsequently sold. and we were always having problems with facebook's algorithm, whatever the hell that is. i still don't understand what that means. it doesn't worry me so much that this liberal versus

conservativism. it's judge somebody behind a screen, that you can't control, was out there deciding what they like versus what should be trending versus what's not trending. that is not what social media's for. social media should be a level playing field. so, that bothers me. by the way, are there conservatives doing it to liberal stories? that would trouble me just as much. now, i don't care what mark zuckerberg's political views are, just like i don't care what donald dell's political views are, but i do care that he brings people in and he fixes the problem if, if there is one. by the way, if this is happening on facebook, who's to say it's not happening on twitter and other social media websites? this should be something congress should look into. >> that's the point. i agree with jimmy, who, by the way is one of my very favorite democrats. he's an old friend of mine. really, what jimmy's saying with respect to liberal and conservative perspectives, there should be transparency. and i think this story so far lacks an explanation much how

transparent facebook's people are. the so-called occur raters. that's what folks really want to know. look, as far as i can tell, i'm not an expert, lord knows, kelly, as far as i've read, some very smart lawyers are saying, look, it's a private company. they can do just what they want to do. okay, fine. i don't think that's in the public interest. but, fine. if facebook wants to get a reputation as an ultraliberal site like, say, "the new york times," just to pull something out of the hat, then their readership or their usership might slump substantially. and their ad revenues might slump substantially. so, i think this is a story that needs getting to the bottom of. >> we want to talk taxes while we have you guys as well. larry, can trump cut the cost in his tax plan without changing it? to what extent have you met with him and tried to influence the directions he goes here?

>> all i'll say is the committee to unleash candidates is which i'm a member of, including trump. this is not the trump campaign speaking, just me a member of the unleash prosperity group. we believe and we have suggested to some folks that with some tweaks, we can make the tax plan even more pro-growth and pro-middle class jobs and, by the way, save a fair amount of money in the so-called deficit estimate. i don't really believe these estimates. i wouldn't bet the ranch on it. but, you know, those are some suggestions we have made. mr. trump hasn't commented on it and he sure hasn't signed off on it. >> doesn't sound like you're a big fan of the tax plan, jimmy. >> no, i'm not, of mr. trump's tax plan. yet i have to see it. my bigger problem is i look back at history and what we've done with tax bills. the reagan '86 tax bill, the bush 2001 tax plan. the heritage foundation said in

2001, when we did that tax bill on the senate floor in that building behind us, but it was actually going to cut the deficit completely away by 2010. that didn't happen. so, i'm actually not so sure that i buy this idea. by the way, if we just paid for tax cuts as opposed to them -- like the '86 tax bill was revenue neutral. i get that. but the 2001 tax consult we didn't actually 35i for that. that was used -- the money for that was used out of surpluses that bill clinton gave us. so, i have a big, huge problem with not paying for tax cuts, just like i have a big problem with actually not paying for wars when. when you do that, you end up with an $18 trillion deficit. and here we are. >> quick question for larry. larry -- >> the thing s i've never gotten my pal, jimmy, to understand the supply side incentive factor. >> yes. >> where taxes matter. if you keep more of what you earn, you get better growth, more jobs, more taxable income

at lower taxable rates. and get rid of the cronyist loopholes. >> i'm with george h.w. bush. i think that's phoney. >> that's what trump is doing. that's what john f. kennedy did. that's what ronald reagan did. and i'd say we had a pretty good stretch of growth. >> larry, i've got a yes/no question for you. it's evan. yes/no, can you do corporate tax reform without entitlement reform? because your boy, donald trump, doesn't want to do any entitlement reform. >> the answer is yes. the answer's yes. and the answer is -- >> that's what you think. >> the answer is sequential. you know, if you ask me, the best time to do good entitlement reform is when we're in a period of a rising economy. so, here's my notion, evan. it's very simple. but i'm sticking to it. number one, slash the corporate taxes, i've said 100 million times, slash it. go to immediate expensing and territorial. that will boost the economy. you'll see that in at least a

year or two years. when you get back to 4%, 5% economic growth, then lets go into the entitlement issue. but right now, taking benefits from folks, middle class folks who haven't had a raise in 15 years, this is not the right moment for that. long-term -- >> trump has changed you, larry. no, we love -- thank you for joining us. larry kudlow, jimmy williams, too. really appreciate it. time for a cnbc news update. pleats get back to sue herera. >> hi, kelly. embattled bazillion president dilma rousseff held a news conference with foreign press a day after being impeached. she said the impeachment process was brought about because the interim president had no other way to get to the presidency via vote. a judge found joe arpaio in contempt of course. it's expected to lead to greater court oversight of his office. general motors says it's

temporarily halting sales of 60,000 new 2016 suvs because the windows labels overstated fuel mileage by one to two miles per gallon. the company called it ab inadverteinad ved investigator -- inadvertent error. a woman and her children stepped guard to claim the powerball jackpot. they chose the lower lump sum option making their ticket worth $284 million before taxes. they plan to tithe 10% of that money to their church. and that is the cnbc news update at this hour. back to you, kelly. >> thank you. i was wondering if they would find them because time passes, you might lose the lotto ticket. >> can you even imagine? i can't imagine. >> thank you, sue. >> i'd like to win. anyway, have a good weekend. >> thank you. is any bank safe from a cyber attack? up next, with two cyber security breaches at international banks

reveal about the vulnerability of our money supply globally. everybody knows that business today is built on data. the thing is, most businesses aren't getting the most out of it. the ibm cloud is uniquely designed for all kinds of data. like data from the weather company for 2.2 billion locations. or billions of health-related data points. even social sentiment in real time from hundreds of millions of people. it's all in the ibm cloud. if you combine that with the data your business already has- then things get interesting. so right now we're working with a retailer to blend social and inventory data to help predict demand. we can help a hotel chain match weather and local event data so they can adjust room prices from minute to minute. and another company we work with can apply analytics to sensor data to save millions in energy cost.

today, every business runs on data. that's exactly why we built the ibm cloud.

tod♪ no, you're notss ♪ yogonna watch it! ♪tch it! ♪ ♪ we can't let you download on the goooooo! ♪ ♪ you'll just have to miss it! ♪ yeah, you'll just have to miss it! ♪ ♪ we can't let you download... uh, no thanks. i have x1 from xfinity so... don't fall for directv. xfinity lets you download your shows from anywhere. i used to like that song.

♪ welcome back. another bank has been hacked. investigators are linking it to the bangladesh attack that resulted in $81 million being stolen. we have more on what this means for the global banking system. >> s.w.i.f.t. is the international consortium based in brussels that does electronic messaging. it's used in about 200 different countries. it is the guts of the global financial system. they put out a statement last night saying they found a second instance of malware now at another unnamed bank in addition to the bank of bangladesh situation that resulted in the $81 million theft. they also say that this is an indication that there is a wide and what they call highly adaptive campaign targeting banks for cyber heists. they say the hackers were able to actually block the banks from realizing that the fraud had

occurred because they manipulated the bank's own internal software that connected to the swift system. they say the vulnerability here is in a pdf-reader program used by some customers to access the swift messaging system so there is a big battle going on here now in international finance over who is exactly to blame for all this. the new york fed has sort of by implication indicated that they rely on swift. swift has sort of by implication indicated that they rely on the banks. and the bank of bangladesh has by implication indicated that they want some money back from the new york fed and from potentially from swift. so, all of this goes to show that there is a massive hacker campaign on right now targeting the guts of the international financial system, kelly. >> stay right there. guys, this is the problem. now people know these vulnerabilities exist for probably the most important banking connection in the world, why wouldn't they continue to after it? >> it's very eye-opening. whenever you hear of a sustained

attack, it's only as strong as the most susceptible component and that's where you bring the vigilance. it's obviously a big, broad system with a lot of surface area. >> and security now, i mean, i would expect they're now either going to have to invest millions into shoring this up. >> you know, my thinking on this is that somebody's going to always find a way. what you need is you will never totally be able to wall things off. you need a way to redress issues once they happen. otherwise you're trying to solve really something that's insolvable. >> that's a good point, too. amon, last word? >> the irony is the international financial system has spent 30 years trying to make these transfers as seamless and frictionless as possible. now it might be the case they're too seamless and frictionless and too easy for hackers to get in there and steal money from these banks. >> thanks. we'll continue to follow it. we have a news alert on apple. kate kelly, tell us about it. >> interesting details here out of the 13-f filed by apple,

which is david tepper's highly successful investment firm. a couple things i draw attention to. he has significantly long new financials in what promises to be a higher interest rate environment looking at bank of america. they added nearly 7 million shares as of this filing. synchony financial. he has some energy holdings but worth noting he has added significant new exposure, about 11 million shares, give or take, in both energy transfer partners and williams company partners. those are two notables there. a couple things to look at that he's decreased. apple he's totally out of. 1.25 million shares out of apple as of march 31st. don't know what he's done since then. he seemed to have paired his position in alphabet down by 64,000 shares from where he was a quarter ago. he's also decreased his position in -- i'm sorry, he added to

alphabet. decreased general motors and goodyear tire by, you know, a significant margin on the gm side. a smaller margin but still over a million share decrease on the goodyear tire side. finally, it look says as of this filing they bought almost 1 million shares of valiant pharmaceuticals, that embattled health carroll-up company. 194,000 shares as of this filing. we reached out to them for comment and we were told by someone familiar with the matter they moved out of that position. we saw a move in valeant recently but it appears -- hopes tepper might be in that stock to stay are not true right now. >> interesting, kate. i mean, guys, what do you think? there's a couple things going on here. one is, this is a problem with these filings. it's a snapshot of a period in time, but it can never give you the complete picture of what's happening. at the same time, it's interesting to note that he was in and out of it. >> it is. tepper is not one where he's -- you know, he's flipping stuff

day to day necessarily. sometimes these positions are meant to actually be held for a little while, even if the information is stale. clearly not terribly concerned about the macro environment. i mean f you're in bank of america in any big way, it shows that you don't really think the world's falling apart. this guy, remember, was a credit guy by heritage. i mean, he clearly isn't too scared. but on the other hand, i think it's a lot of opportunistic stuff. buying valeant in the first quarter of this year was a bet this had staying power and was overdone on the downside. >> to me it's all about -- he runs a hedge fund and yet he's kind of picking and choosing stocks like any portfolio manager would. you have to wonder when you look at the holdings of a lot of these hedge funds f i'm buying into apple loose sa, if i buy a hedge fund, what am i really getting? >> stock picking if they do it well? >> that's not what you're supposed to be in a -- >> esoteric credit stuff, mess

aneen debt -- >> successful hedge fund guys were george soros and taking big bets that have high payoff, high risk/reward, general profile. >> doesn't it mean you have a long position? >> no, no. >> pick a couple stocks, you have a long position -- >> all i'm saying, there's a lot of attention recently on hedge funds and their relative underperformance lately. you're looking at one of the more prominent hedge fund guys -- >> this strategy is better to go long term than the esoteric, which works for a soros -- >> you have to wonder what you're actually paying for if you own a hedge fund. if it's a guy to treat a fund like a fidelity fund manager. i'm not saying that's exactly what he's doing, but you can get it cheaper at fidelity. much more cheaply at vanguard. >> we'll look at more 13-f filings. more and more media companies think they'll get fat

on skinny bundles. up next, the editor-in-chief of "variety," the future of tv is all next. stay with us. wow, that was random. random? no. it's all about understanding patterns. like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: every third tuesday. we have pattern recognition technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. there's no way to predict that. td ameritrade.

of "variety," the future of tv sthu welcome back. today is the last day of the annual new fronts presentations of two-week marathon where companies from hulu to youtube are making pitches to ad buyers. these pitches to advertisers come at a time when many digital

companies are setting their sights on the traditional cable ones. these attempts to lure customers, so-called skinny bundle options, hul uconn firmed at its presentation it has a skinny bundle option and youtube is ready to launch another one next year. our next guest wrote an opinion piece for "variety" saying fat chance these skinny bundles happen. thank you for joining us, andrew. >> thanks for having me. >> so, your point here is that if hulu and youtube are trying to take over and disrupt the industry with these skinny bundle roll-outs it's not going to work, is that right? >> i just don't see it happening. look at the market conditions. number one, cord-cutting. we're not really seeing it yet. it may eventually happen. not happening yet. number two, there are already skinny bundled products out in the marketplace from dish, from sony, that really haven't seen much traction. they're not selling like hot cakes. number three, let's not forget

we've already seen some very big players attempt this, like apple and intel, only to back away. this is a tough one. >> bringing in the panel for some thoughts here. >> andrew, you say it's a tough one. why is that? is it just because the programming costs haven't adjusted? in other words, when i look at these equations, the decision if you wanted to go with a skinny bundle is to pay a little less and get a lot fewer channels. right now that seems to be what the bargain is. >> yeah. and it sounds like a great bargain in theory. but as apple can tell you, obtaining that programming can be brutally difficult. and also as far as being a compelling offering in the marketplace, the devil is in the details. what channels are you going to get? what's your price point? so far, dish and sony are finding out it ain't so easy. >> how much, andrew, of this -- is a discussion as well about the way it's being delivered, through cable or over the top, you know, how is that playing into the offerings here? >> well, over the top is, of

course, going over the internet, which is why you're actually seeing companies like dish and also verizon offering these things. i actually think if skinny bundles are going to make it into the marketplace, you'll see incumbent pay tv providers probably have a little more traction than some of these upstarts like, say, a hulu or youtube. they control the pipe. >> andrew, it's evan. quick question, do you agree that consumer behavior, especially among younger people, like my children, is fundamentally changing? and if that is the case, what does the future look like ten years from now if it's not skinny bundles? what is it? >> that's the million dollar question. i do agree it's fundamentally changing. where i'm not so sure is, you know, when you look at young people, millenials, clearly they're growing up on youtube. clearly they're growing up with low-cost options. but does that mean that once they get jobs, they're not actually going to graduate back

into the pay tv system when they can afford it? that's a very debatable point. i'm very ambivalent on that front. but certainly some will say, as soon as they've got money in their pocket, they're going to go back for the big bundle, where sports is, where news is. it's a tough proposition. >> sports and news and everything stay there. we look forward to more from the upfronts next week. a little more detail on this. for now, thanks for joining us. it's commencement season and some big names for obama to howard are offering pearls of wisdom. we'll size them up and offer some of our own. the tsa warning travelers this summer could be one of the busiest travel seasons ever. they're urging passengers to sign up for precheck. if you haven't, check it out.

i'm in vests and as a vested investor in vests, i invest with e*trade, where investors can investigate and invest in vests... or not in vests. sign up at etrade.com and get up to six hundred dollars. ♪ ♪ (charge music) you wouldn't hire an organist without hearing them first. charge! so why would you invest without checking brokercheck? check your broker with brokercheck.

the busy summer travel season fast approaching. and the transportation security administration is warning travelers about very long wait times at airport security. phil lebeau joins us now. three, four, five hours here, phil? >> i don't know if we're talking five hours, but some places are already seeing three-hour ways. longer lines this summer in terms of people going through tsa check points. earlier today, the head of homeland security outlined how they're trying to alleviate this problem. he was asked point-blank, is three hours a little ridiculous for people to wait in line to go through security? >> obviously waiting three hours for what may be a two-hour flight or 90-minute flight is not acceptable. it taxes everybody's patience.

>> unfortunately there are not a lot of good solutions that are coming. they're adding officers, that will help a little bit, more canine teams to help sweep people in a big group, make them go through quicker. and they're working on getting people to reduce the number of carry-on bags. despite these efforts from the tsa and the federal government, we're going to have long lines this summer. record number of people flying and you can expect a lot of people are going to be frustrated. >> i'm already -- i already feel frustrated. the tsa precheck has been one option. >> right. >> it seems somewhat unreliable. half the time they're sort of directing you in a different way. i don't know, i wonder if that's really going to help people. >> it does help. it helps especially early in the morning for business travel. take it from been who does a lot of business travel early in the morning. they fly through fairly quickly, but it's not a perfect system. >> the whole thing is a total nightmare. once they put it under homeland

security, you knew it was going to be a nightmare. by the way, it's not like we haven't had enough time to figure this out. how long has the tsa been around? >> until something happens -- >> well, that's not the way you set policy. >> i hope we can one day say, remember when we used to have to wait in line? commencement speech at the university of southern california today, receiving an honorary degree. we'll see what he had to say and bestow some of our own advice for graduates. ♪ i built my business with passion. but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands of dollars each year going back into my business...

that's huge for my bottom line. what's in your wallet? there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be. amazing sleep stays with you all day and all night. sleep number beds with sleepiq technology give you the knowledge to adjust for the best sleep ever. it's the semi-annual sale!

save $500 on the memorial day special edition mattress with sleepiq technology. know better sleep. only at a sleep number store. my m...about my toothpasteice. she eveand mouthwash.ice... but she's a dentist so...i kind of have to listen. she said "jen, go pro with crest pro-health advanced." advance to healthier gums... ...and stronger teeth from day one. using crest toothpaste and mouthwash makes my... ...whole mouth feel awesome. and my teeth are stronger too. crest-pro health advanced... ...is superior to colgate total... ...in these 5 areas dentists check. this check up? so good. go pro with crest pro-health advanced. mom's right...again!

remember this, graduates, when people start telling you that you're crazy, you just might be on to the most important innovation in your life. [ applause ] of course, the other possibility is, you're crazy. >> that was oracle chairman and founder larry ellieson giving the commencement speech at

southern california, where it looked beautiful. he received an honorary degree from the school but actually dropped out of the university of chicago. >> it's interesting. a lot of famous dropouts. >> yeah. >> because you only hear of bill gates, zuckerberg, you read a lot about the ones who attended. >> any pearls of wisdom? >> i came up with something. although i was criticized. stealing other people's quotes. i think it's very hard to say something original. oh, there they are. know thyself. all you need is love. that's the beatles. >> hey, wait, let's have a sent mental moment there. >> it's better to be a lover than a fighter. >> is that all you need, though? >> no. it was my last piece of advice there. i told san tolly what i was really going to say. i said i would probably be fired for saying it. you want me to go ahead and say it? two pieces of advice. for young graduates.

number one was, don't vote for donald trump. and the other was, don't go work on wall street because the next 30 years ain't going to be like the last 30 years. that's real advice. >> i think they'll probably be with you on that. >> i think so. >> what are your words of wisdom? >> the basic is, don't expect whatever plan you have right now to actually be the one you're always going to be fixing on. and forget about the past. basically your strategy may not survive engagement with the enemy. >> do we have the baseball picture? >> evan and i went to the same college. >> we did. i'm much older than he is. but i think we have similar outlooks on life, even though he was very critical of my original commencement advice. >> you're quoting from the best. what did you think of larry ellison's by the way? >> it was good. like most people, innovation might be making toast in a new way in the morning.

>> we're talking to young people starting their -- >> i know. i like the advice is, which is go after life, don't be afraid of failure. i'm all in favor of that. >> mike and evan, have a wonderful weekend. that does it for "closing bell." "fast money" begins right now. "fast money" starts right now. i'm melissa lee. traders on the desk, tim, steve, brian and guy. tonight on fast, the former ceo of jcpenney said he knows which names will survive the retail wreck and which won't. there's a disturbing trend emerging among the hedge fund community. it includes some of the most widely held stocks in america. and later, did you lose money in apple this week? well, we've got a clever way you can get that money back. it will cost you less than a bublg. first, we start off with the sell-off. 9 dow sliding 206 points at its lows. the dow and s&p posting its first