>> how amazing. >> which stock by the way held up even with all these news of the auto pilot accidents and et cetera. held up strong. we'll trade that. >> thank you for watching "power lunch." >> "closing bell" starts right now. hi, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> i'm mike santoli in for bill griffeth. we might have some news this hour. we'll see. tesla ceo elon musk set to make a announn announcement this hou. >> up nearly 2%. who says brick and mortar stores are dead? best buy getting a boost on the earnings this morning. up nearly 19%. we'll dig deeper and why it's such a shock to shareholders in a moment. mylan shares falling again today as outrage over the epipen

price hike spreads but that's not the whole story. mylan raised prices more than 100% for 7 products over the last 6 months. those details also coming up. cash burn isn't always a bad thing. we'll talk to the man known as the dean of valuation about which stocks with negative cash flow he says could be good investment opportunities. aswath damodaran coming up. nasdaq and s&p could be in record territory dow. bertha coombs, when's happening? >> you know, kelly, this is like the rodney dangerfield market. nobody gives it much respect yet the nasdaq continues to grind to new highs and seeing some of the small caps catching up to the big cap indices. russell 2000 within 3% 5% of the all-time high set 13 months ago and this is a big laggard and momentum continues to be in big

tech. chips seeing a new 16-year high. dating back to october 2000. broadcom among the chip stocks today at record highs. the sector up 16% since the start of july and a big comeback before brexit. big cap seeing more momentum. some indices of 16-year highs. that's helping to send the nasdaq 100 today within just a couple of points of a new all-time high, the big cap index, qqqs. and even though pokemon go may have peaked, ea today is at a historic high. netflix, in fact, among the best performers today. among the fang stocks and best so far this month. still, though, well into bear market territory. retailers today kind of mix on the back of the good news coming out of best buy, amazon one of the better performers, reportedly ready to launch a $5 a month music streaming service,

guys. but there's a catch. you have to ask alexa because they want it on the echo devices. amazon wants to hold on to you and keep you in their sphere any way they can. >> all right. bertha, thanks very much. alexa is not yet invited to live in my home. when she is maybe we'll ask her. >> 5 bucks a month for the music. >> not too bad. let's get to the "closing bell" exchange. today we have susan fullton, stewart garfoyle and rick santelli. susan, we heard of consumer discretionary stocks up and chemicals, materials. seems like the cyclical trade is in gear. do you think that's something worth playing here? >> i think they're moving -- >> market itself is looking for yield. you know, it is almost only

horse race in town right now. is yield. and the cyclicals, i mean, the tech stocks are beginning to pay pretty well. we're a little concerned because the market seems or the complacent. it's not very volatile. it's as though volatility it's had since 1995. and it's hitting all-time highs everywhere except in terms of growth and productivity and income. and that people stuff and just not happening yet. >> well, just to jump on that a little bit, 1995, quiet market. wasn't reason to run away from it, was it? back then. >> no, no. i don't think you can run away from the market. only horse in the race. >> yeah. >> well, sarge, what you watching? >> we hit 2193 on the s&p 500 today and hit it last week so that's our firm level of resistance. i think for today's trade,

when's most important is thing two things. the price of oil above the technical support level thanks to iran. that's a real positive. dragging the energy stocks higher and new home sales. which print out a really dramatically higher level, highest level since 2010. a print like that for existing home sales tomorrow, the housing sector is on the way even if manufacturing's not really coming along for the ride but there are undeniable bright spots in this economy. >> rick, every market seems to be impressed by the prospects for a pickup in growth except maybe the global government bond market. those yields haven't bunched. we had a firm 2-year treasury auction today. what are you seeing? is anything going to break, the treasury complex out of its range? >> well, i don't think that the market is enamored with the prospect of growth. just because we had 654,000 new homes, it would be 1.5 million

if they were enamored. you need some perspective. this is good in the new normal but not enough to pay for the new normal. and i think, you know, the epipen, cnbc has done such a wonderful job of covering this. what does this have to do with the market? everything. how many guests have talked about regulation issues? you know, the fda is just a bureaucratic entity and the government person that was on today basically said as much. he knows how to lob the grenades at the problem but he has no idea about fostering a landscape of growth. without that, it just -- you're going to see the markets tighter and tighter and tighter. you know, is it really a proud moment to be a 5,000-plus handle in the nasdaq? we were there when i had all black hair a while ago. >> susan, what would you add to that? >> one of the things i think people forget is about 10 or 15 years ago the fda gave -- took money from major drug industries

to do its own research. and since then, the fda has been owned by major drug industry. and we've seen the result of that. i mean, the fda is not the institution it was in the '70s and '80s. the fda is an institution that in order to save money in the budget and this was a congressional decision, in order to save money in the budget took in industry as its major supporter and its major funder and we're paying for that. >> we'll have more on the epipen issue coming up in just a moment. >> absolutely. i mean, and sarge, out to the market action right here, a lot of talk yet again today about how just eerily calm the stock market has been, been in the extremely quiet range. what are the implications of that for you? >> you know, i couldn't hear you question right now. i came in garbled but i like tech right now. i was in tech last week. i'm more into the space this

week. more so into the growth names as i've been in the old-school tech names for quite a while. as for the industrials, i'm sort of moving out of them. just a matter of getting the right price. is that what you asked? >> not exactly, i was actually talking about the extreme low volatility, the calm tone we have had to the market right now and whether that tells you anything in particular about the prospects for either up or down or some kind of a more dramatic move. >> you know, it's very hard to think that you want to take very large shots right now with janet yellen's speech on friday at 10:00, with the bank of japan, with the ecb, with the bank of england all on deck for september. i think now there are with those nice pmi numbers out of europe, kuoda, i think people and we saw overnight are kind of sheepish about whether there will be a large stimulus package brought forth by the three central banks in september.

people are right now, they're a little careful. i can't blame them f. you're going anywhere without protection right now, it's a dangerous thing to do i think because the volatility may be around the corner. >> all right. that is the forboding feeling people are getting. thank you. >> thanks. best buy surging on an earnings beat thanks to rising market share in electronics. courtney reagan has more. >> best buy may be the last big consumer electronics retailer standing and standing strong. the in-store demos might be making a difference. they post a wide profit beat on stronger than expected revenues when the street was forecasting a delicline and while sales fel the category performed the opposite of best buy. consumer electronics are third of the best buy total sales and important. target's electronic sales fell

double digits in the second quarter and apple down. joly said he won't comment on individual vendor performance other than saying the relationship of apple and samsung is strong and best buy said sales of tablets and smartphones are hurt by lack of new products and sales are now, quote, less bad than they were. walmart with a strong second quert and the retailer's u.s. ceo wouldn't break out electronics performance either when i asked him but tv sales soft atwal administrator's samsung stores and joly said the price drop and company's still continuing to gain share there, anyways. kelly and mike? >> this is an amazing story. i understand the comp sales up less than 1% and double more than anybody expected. courtney, so after target told us that electronics were a problem and rattled off the other places it's not been a

positive force, what is best buy doing? what are the in-store demos? seems at odds with obviously what everybody was expecting. >> right. so we have talked for a long time about the strength of amazon in electronics and some can be considered commodity products if they're the same or virtually the same across retailers but if you're going to spend a couple thousand dollars on a whole-home theater system, the 4k tv, plus the speakers or the sound system, whatever it is you want to include in that, you probably feel better seeing it in person, getting some information about it from a sales rep. best buy's done a good job giving you information on the website and in a lot of cases joly said consumers come in to the storms informed with the information online. come in and ask the questions, see the demo, feel better and buy it in store and we talk about the physical experience still being very, very important for retailer. you can't necessarily do that on

amazon. >> no. absolutely not, courtney. i guess the big question is, you seem to have a bit of a zero sum game element in retail right now. some players don't hit it in the category. somebody else takes the business. can we extrapolate this category of best buy delivered into back to school and holiday? >> i asked something similar and you might remember that the national retail federation forecast a strong back to school year largely because this is a year that parents finally have to go and buy the new computer and buy the school supplies, the fill in and leftovers weren't enough and joly said, look, computing is strong for us and back to school is very important. but he wouldn't really extrapolate further. i think they're doing a lot of things right with the transformation. the eps beat largely a continuation of seeing from them. joly is very good at cost cutting and analysts think there are no costs to cut, he keeps

doing it and i think there's strength on seeing from profit in the operations as well as what we're seeing in store. >> and as the market has taketh away, it giveth. courtney, thank you. >> thank you. >> a great story. courtney reagan. best buy shares up on a market generally moving higher. in the possibility of setting new highs for the s&p and the nasdaq on the close. the dow's up 32. nasdaq z we're awaiting breaking news this hour from tesla. we'll bring it to you the moment it hit it is tape. up next, not just the epipen that mylan raised the price of. we have other price hikes of last six months. a leading expert will tell us why he's calling twitter a malignant cash flow company and not necessarily a bad thing.

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pg&i help customerss, how with their bills.day? there's different rates to fit different needs, so listening is a huge part of my job. because customers want to know that you hear them. they have kids, they have families, they have priorities. i definitely understand that. i have three children, i was a stay at home mom, i didn't have money to pay the bills, and so i put myself in their shoes. and i'm going to do all that i can to lower their bills and to help their situation. to choose the rate plan that works best for your family, visit pge.com/rates. together, we're building a better california. welcome back. let's look at the materials sector leading the market today, a leader in the group cf industries, all the agriculture, chemical and fertilizer names

and seems excitement, merger chatter and an upgrade. mylan lower. remember, mylan's ceo three months on this program and asked her about drug pricing on the heels of maturing pharmaceutical scandal. take a listen. >> i think there's been a lot of confusion of washington and wall street talking about drug prices. when you look at touring or the valaents, they weren't generic drugs. they were specialty that partook in abusive practices. as with anything, there's loopholes and can be abuses. i think the system overall, if you look at the generic industry, we represent 88% of the volume in this country. have saved $1.6 trillion over 10 years so, you know, i would say that the system works and it's about i think really now taking a harder look company by company and our profiles and what makes us different. >> and so she was trying to 'em if size the generic industry and

mylan is in different from specialty pharmaceuticals but a guest asked what makes mylan different than other companies raising prices. >> what we have said and committed to do our part make sure the street, the community understands, the investment community where our growth and why we're doing. i would start by saying looking at the investments we have made over ten years, a manufacturing platform and criticized for years we were investing too much in cap-x and r&d and our people. so our organic drivers have been core to us continuing the growth trajectory we have had. the acquisitions have broadened our footprint, dosage forms like injectables and didn't have critical mass and sitting here today we believe we have an operational platform. we have a commercial footprint across the geographies that's

second to none with the global supply chain of manufacturing what we're selling. so there is huge differences between that and slashing cost, slashing r&d, slashing jobs and raising prices. >> so mylan ceo bresch saying they use the money to invest in company. meg tirrell has a closer look at other price hikes at mylan. meg? >> that's right. while epipen is gathering attention today, mylan is a company that has raised prices on a lot of drugs this year. pointed out in a note actually in june by wells fargo. you know, heather bresch talking about a generics company and pointing out in the june note price increases on a couple generic drugs, more than 400% for the drug of gal stones. more than 400% for this meto clopramide, for a reflux disease and then 400% for the ibs drug.

he says in the 6 months through june, mylan raised prices more than 20% on 24 products and more than 100% on 7 products. epipen, of course, is their biggest product with more than $1 billion in revenue and see here how that price increased over the last five years. now, while it was said in the note the price increases except maybe for epipen have a small impact on the mylan business it could impact the reputation and shareholder sentiment about the company. mylan down there more than 4%. he says in this price environment, increases of 400%, 500% could be beacons for scrutiny and what we have seen of course. we reached out to mylan and in june they responded to this report calling the analysis flawed and saying that they have more than 1,400 products they sell globally diversified business model there. but, kelly, certainly, the scrutiny is here today. >> yeah. you know, meg, i guess it's pretty hard when we hear about

these different product price hikes to put it all in context of whether, in fact, this is generally the way the industry tries to attempt to get these price increases through. in other words, any big company's product fort portfolio would you find these price increases? >> maybe not the large price increases but you see continuity across the industry in terms of maybe multiple, single to low double digit price increases every year. that's pretty normal. even today we see an increase on two cancer drugs and not a thing to make a politician turn and say, wait a minute. what? and so, this is the kind of thing that's really garnering attention and then a drug like epipen and no real other options out there right now and parents depend on this for kids, that's why people react the way they are. >> i was asking about competition in the pipeline at this point. have they raised prices so much,

not only to alienate the consumer but leave the door open for someone else to enter the space? >> that's what everybody says. it should encourage competition to come in and seen competition failed here. there have been a couple of different instances trying. santa fe with a device which was recalled from the market late last year because it dispenses the product improperly and teva is trying to bring in generic and rejected by the fda for dei. >> i guess we'll see if it kind of creates any other centralized response. >> yeah. >> thank you very much. >> thanks. meantime, we have just under 40 minutes left to go before the bell. the dow still up and off the earlier highs of about 30 points. s&p 500 threatening the intraday all-time highs earlier up 6. about a quarter of a percent. we are waiting on tesla for

an expected product announcement this hour. we'll bring you head lines when they're released. also, a leading market technician makes a bold case for tech stocks and a bull case for consumer discretionaries. what if a company that didn't make cars made plastics that make them lighter? the lubricants that improved fuel economy. even technology to make engines more efficient. what company does all this? exxonmobil, that's who. we're working on all these things to make cars better and use less fuel. helping you save money and reduce emissions. and you thought we just made the gas. energy lives here.

tesla stock up on anticipation of a product announcement. some investors cautious because of its enormous cash outlays.

building battery factory and ramp up production. not only company burning through cash. our next guest says this isn't necessarily a bad thing. >> joining us now is aswath damodaran, professor. mr. dean valuation on set for us. cash is king. what are you saying here? >> it is eventually. if you make it a centerpiece for investing, you never invest in a young growth company. it's like having kids and complaining that the kids are teenagers not acting in a mature way. it is the nature of the beast. >> maybe complaining that they eat too much and you have to force them to pay for their food so they can grow. right? so how do you tell a company, a young company, that's using its cash intelligently, building value for the long term and those that aren't? >> i wish i had a precise way of doing it but you have to look at a multitude of things. look at the underlying business.

make a judgment on what that business will look lick if the company makes it. you got to be an optimist. you cannot be a pessimistic and look at the companies. i have made this mistake before. management matters more. >> by the way, i was just going to ask if twitter is one of your favorite companies given what some see as a cash burn rate there. >> i dislike twitter as a company but like it as an investment because i think it's a company i see potential and could have said that three years and doesn't seem to have a management team able to convert it into cash flow. in fact, twitter is a company where i have learned the hard way how much management matters when you have a cash burn company. >> you have a company that's young, raising capital from stock or bond sales or something like that and discretion where to put that money. you can make a lot of mistakes, i assume.

gopro, another company you looked at and really a darling and crashed to earth. where does that sit now? >> earlier this year when i valued gopro, it is a cash burn company and given the price i could make a bet on gopro. not one of the sure things. but it's a company that's done reasonably well for me and a company might disappoint me in the future but if you avoid companies just because of cash burn, you're taking big segments of the market out of your port foal yes. >> how long of a time frame do you give them? amazon's early days come to mind. tesla now we have mentioned. twitter even you said a couple of years ago. what point do you say it's time to rationalize the business and see if it's profitable and grow and return a lot of cash? >> i think it depends on how big the dream is. with the problem of tesla is elon musk expands the dream and like he's moving the goalpost which is a little difficult for investors because you've got to

readjust. the problem i have with the company like tesla is one part of the business, actually the cash burn looks like it's leading into positive territory. the automobile business. the other part of the business and this is my problem with the solar city aquick sigs is cash burn without an end game. that's going to pay off. like you have the benign version of cash burn and malignant version and i don't know which wins out. >> can we look back at amazon that expands the dream, arguably, as well? saying that the moment at any given point that this was going to flourish? >> right. i think amazon's ruined business for tons of companies because there are so many amazon wannabes. amazon is unique company because it's had a ceo, told the same story for 20 years. it is amazing. he stayed consistent. other thing of cash burn companies. you need a storyteller consistent with the story an

delivers based on that story and that's been amazon's strength for 20 years. >> what is the overall ratio of companies that pan out in terms of their cash burn, turns into a great investment and the ones who aren't able to make that transition? i would imagine the number that make it through and past that point is small. >> especially if you started private company space because that's when venture capitalists play. i would say 1 in 3 companies makes it and 2 or 3 doesn't and they hike up the target rate of return. the problem we face is those companies that used to be in the venture capital increasingly are in the public market stage. >> wait. most say they're in private hands and not public ones. >> ubers of the world are the exceptions. if you look at 30 years ago, for instance, you got to get to a certain stage before you went public. in the 1990s a game changed. you could be a young start-up with huge cash burn and public markets you took on and only

problem is they are not designed for these companies and only tool you have is a pe ratio and stuck with a cash burn company and not going to work. >> it's amazing to think about how much has changed in a short period of time and wondering if you go back to the news of kobe bryant starting or has a venture capital firm and saying this is what i'm doing now. $100 million seeded with. what do you do if you're sitting in that seat and given a ton of companies, very, very early stages and might be products to look at and pick to invest in? are you supposed to take what's given to you and say is it profitable and throwing off cash? how much hope and rope do you give them? >> you have to think about deep money art options. you know that 8 out of 10 times they will end up worthless. 2 out of 10 pay off have to pay off in such a big way and make up for the other 8.

you got -- i mean, you can't win most of the time. your winners have to be big enough to cover your losses. so it all comes down to either getting lucky or really good at picking those supreme winners. >> also reminds me of buffett and monger as much the job to identify good management and the piece of the job might be more difficult than good businesses and tricky thing about some of these people is you can have a starry-eyed guy with a great vision about something, you don't know if they're going to be a great manager, able to turn it around. so you're dealing with lot of questions and a lot of variables that volatility is so high. >> i think you got to ask questions. any management that boasts about the cash burn, i have seen young management, young company managers say we can burn off a lot of cash. making money is difficult. so you almost need managers who can operate on two tracks for it to work about. >> we have breaking news from the company of tesla.

thank you for joining us. phil lebeau, what is the product announcement? >> new battery pack. people might be saying, new battery pack? more energy and more speed will be coming to tesla model s and x opting for a 100 kilo watt hour battery. performance versions only. 100 kilowatt hour battery. more range. greater acceleration. when's the difference and the specifications and how much will you have to pay? let's talk first about the model s because the changes fairly significant. in fact, it's now going to have a range of greater than 300 miles. the range, 315 miles. it will go 0 to 60 in ludicrous mode in 2.5 seconds. previously 2.8 seconds and dropped it down to 2.5. the price $134,500. that's where it starts at. if you have already ordered a

model p p 100d and you will get an upgrade $10,000. as for the model x, the range to 289 miles. 0 to 60 drops below 3 seconds at 2.9 seconds and the price $135,500. we should point out questions on the conference call with musk about things like auto pilot and the ability for these batteries, with the vehicles and auto pilot. he said we're not talking about autopilot at all and another reporter asked about the model 3, whether production has begun. musk said this is all about the 100 kilowatt-hour battery pack. no questions answered about the model 3. that's the news from tesla, kelly. certainly significant if you want a performance version of these vehicles. >> shares coming back down to earth. >> a little bit. backing off a little bit, phil. i wonder if one element of this

announcement maybe points to an override concern or background concern of tesla. if you own one, you can pay a fraction of a new car price to upgrade it to the latest. it doesn't lose much value if the way they introduce new features. >> they have been doing that for sometime. there are software upgrades out to the vehicles on a regular basis and if you talk with tesla owners, they talk about one of the features that they like is the ability to upgrade this vehicle without having to trade it in to buy the latest model that's out there. clearly, with a battery pack, you have to make some changes in terms of getting a new battery pack installed but that's part of the business plan that they have at tesla which is you buy a vehicle, we can upgrade it over time. >> phil, just a quick question. did they talk about recharging this battery or just having access to the kinds of recharging equipment you'd need for it? not sure how all of that works. >> will it take longer to recharge this km paired to a

p90d? >> yeah. >> not dmemonstrate bring different. not a radical departure of the battery pack. you are looking at more energy and more capability and that's why they're saying, look, if you have already ordered a p90d and want a 100, add on another $10,000 and we'll make it for you. by the way, they expect the volume of their production for these 100 kilowatt-hour battery packs in the vehicles by 10% to 12% of the weekly auto production. about 200 cars. >> wow. all right. thank you so much. phil lebeau with the news, product announcement of tesla. the stock up about 1%. who knows the speckation would be. time mow for a news update. let's get to sue herera. >> hi, kelly. president obama arriving in

louisiana touring the flood-ravaged baton rouge area and promising support to thousands of beleaguered flood victims. he thanked first responders, those storms killed at least 13 people and forced thousands from their homes. >> i come here first and foremost to say that the prayers of the entire nation are with everybody who lost loved ones. we are heart broken by the loss of life. at a state police crime lab in chicago, governor bruce rauner signing a gun bill to strengthen gun laws trafficking in that state. 425 people murdered by firearms in the windy city this year. a florida teen one of only four people known to have survived a brain-eating ameba infection. his family joining doctors at a news conference in a florida hospital in orlando. it appears that he was infected while swimming on private property in broward county. microsoft creating the xbox onesie.

the enlarged pockets apparently enable you carry the controller and also an arm pouch for quick and easy access to the mobile phone. and extra large hoods for headsets. finally rollible arms and legs to cater to all temperatures and all seasons. you would need your mobile known with your headset on, i don't know. >> oh, i mean, i don't know. your kids are not there yet, huh? >> no. they're not there. if i have anything to do with it, they will never be there. >> who said microsoft can't innovate anymore? >> unbelievable. >> i think the onesie is an underappreciated innovation itself. not sure if i need an xbox more. >> functional garment. >> i don't know. read a book. >> i'll find the onesie for reading a book. i think it's a snuggy. >> yeah. it is. >> all right. see you next hour, sue.

thank you. all right. coming up on 20 minutes left in the day. we have the dow and s&p all up today. actually, the nasdaq outperforming up a third of a percentage point. what a top trader is watching into the close. amazon is reportedly looking to take a swipe at spotify. you're here to buy a car.

welcome back. less than half an hour to go in the session. today, we're keeping an eye on what the charts are telling us. carter worth is here with places you are underweight and overweight. >> we have to come to a judgment of where to overweight and underweight for clients. two areas we think it's right to stay over and or under would be the following. technology. when's -- want to put it in context. this is a very steep five-year run and literally a pair bollic and this move much for orderly and seven years and nowhere near the high and then just for fun if anyone cares, you have a pe

of 21 and this is orderly and staying with that versus consumer discretion, started the year as an underweight and then see that this is so far and above away from the s&p. we know that this is an underperformer year to date. usually that's not a good set-up. >> do you think this gap here is how well it's done? do you think that's going to narrow? >> you either underperform and both go up or one goes up and one goes down or that goes down more than the s&p goes down. either way, we want to be underweight. >> all right. always like looking at these things. thank you so much for joining us. mike? >> all right. 17 minutes left to the bell. a dow and s&p up. also coming up next, more e-mails, more documents and more headaches for democratic presidential hopeful hillary clinton. we'll have the latest on that. plus, bill gates' net worth is rising and not because of microsoft. those details also next.

welcome back. new data show bill gates is again the world's richest person. the net worth hit $90 billion.

bloomberg say that is $90 billion, gates' net worth equal to 0.5% of the net product. you shouldn't compare wealth to an annual figure of gdp. >> what's the u.s. total wealth? >> u.s. stock market is worth 18 trillion to $19 trillion. >> well, fine. only worth 0.001%. not coming from microsoft. >> not this time. he's sold the stake down over the years and, yeah, keeping the money elsewhere. >> this time, very close with warren buffett and berkshire ha ha hathaway. toll brothers rising, after reporting. it appears mortgage rates are helping to boost sales. chairman says the solid economy and employment picture benefitting the company's target

customers. those shares up more than 8%. also this morning, very strong new home sales data between that and the earnings lifting the whole sector. jm smuckers lower. beat street estimates. disappointed revenue. the shares down nearly 8%. >> not a parent in my shopping but that's interesting. just about 12 minutes left in the trading day. we have the dow and s&p holding on to gains. dow up 20, 25 or so. big day for michael deal here for the data economy when we come right back. the heirloom tomato.

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welcome back. as we head into the close, what did art cashin say the imbalance is? >> 250 to sell. >> the dow up about 18 points. nasdaq, s&p near all-time closing highs. we are on the floor with michael beal. with us right around the time the brexit happened and ways to say it was going to happen. what about today? everyone says it's so quiet out

there. where do you turn for catalyst? >> yeah. it is incredibly quiet right now. coming out of brexit, a thing we said is that you were going to have not a sharp v-shaped recovery but over time you would see a dispersion of the u.s. equities and names concentrated in the u.s. like la-z-boy. now, that trade has definitely started to run the way out. when you look at la-z-boy in particular, they're up 20% since june and 13% from july 1st to august 1st and they're now up only 2% in august and most of that actually took place today. as a result of the kind of cross correlations that people are seeing of la-z-boy and best buy news today and they gave up a lot of its returns on august 15th. not because of any news around them. they're a very quiet stock and because of the downgrades of best buy and now that you see

best buy outperform, that's led to a lot of optimism over la-z-boy to come out and lead to upside or downside around this. >> what other cyclical clues are sniffed out by the system right now? >> never sectors picking up? >> absolutely. when you look at where we are right now, there's a huge diver intelligence of expectations of eps growth particularly on a trailing basis and price run-up. what does that tell you? pe reiatios are extending. there's really only two things to occur to bring it back down. one is either earnings revisions and people bringing down the growth expectations and the second one around that is federal reserve or changes in the asset price and the cost of assets. >> so the warning that you see here is actually maybe with something from janet yellen, stock prices fall? >> absolutely. it is an interesting time. you have seen over the last few

weeks, all of the central banks fairly quiet. and very recently the federal reserve has taken a very neutral stance in preparation for the jackson hole meetings. however, there have been two notable exceptions towards that and that has been the new language this has been put into some of these federal reserve meetings and speeches around regime dependent monetary policy. and so, very often some of those speeches and the types of thoughts taking place in that tend to trickle their way into janet yellen's speeches and so i think that the real interesting point is going to be if that thought process of regime dependent monetary policy makes the way into the jackson hole, in which case i think that's going to lead the market and the sentiment associated with that towards a lot lower chances of a rate hike in 2016. >> got it. >> maybe 2017. with that -- exactly. >> they feel like it's happening with the economy.

>> and then take off and if it doesn't then you will have the spector of interest rates starting to come back up. >> good to see you again. thank you for joining us. fascinating to see what happens come friday. the ceo of data capital management. >> thank you very much. seema mody, what's happening? >> look at mobile eye soaring today up about 6.5% and now poised to close at its highest level since september 8th of last year. the maker of advanced driver systems getting a boost on news that it's teaming up with the maker of delphi in the driverless car arena. it's an opportunity that could result in off the shelf systems for carmakers being presented in early 2019, i should say. shares of mobileeye up about 6.7% here, mike. >> all right. a lot of stuff on the new cars. thank you very much, seema. we'll be back with the closing countdown. after the bell, not quite "raiders of the lost ark," but

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behind the move. >> it is annoying up against the threshold of really breaking out and knocking on the door of new highs for the major indices but i want to see what the stocks unbeneath it or looking like. more than 2,000 stocks trade down here. about 200 new highs down here. i get excited seeing 400, 500. but we haven't seen that and this whole new rally of stuff at new highs we haven't seen the big, big breakout. so today we have some modest. those tech names. broadcoms and those stocks, they're out and new highs. these have been on the new high list for a while now. they keep showing up. every day to the party. i keep waiting for their friends to show up and they're not there yet. >> a point you have been making which is sort of increasing cyclical tone to the rally. >> that's right. >> oil bounced. >> industrials with a nice number, new highs. deere was there, illinois toolworks and it's the same story.

the stocks at new highs for a while. i want to see a broader breakout of industrials and not there yet. >> as we hit the anniversary of last year's big spill, august 25th. thank you. ringing the bell down here, fed-ex and patrick reid. at the nasdaq, oritani financial. all yours, kelly. i think that's a good omen. welcome to the "closing bell," everybody. i'm kelly evans. on wall street, the s&p and nasdaq within reach of new highs and just below the levels. s&p about 3 points below the all-time high of august 15 of 2190. nasdaq at 5260. the dow about 100 points away from 18,636, the record close of august 15th. tesla announced last hour making

new versions of the model s and x vehicles, the shares take a look. up about .7% today. off the highs. we will have more details from this announcement and from analysts expect coming up. mike santoli is back with us for the hour and rob cox, breaking news. welcome. steve grasso will join us off the floor in a moment. but, you know, again, even though the action is not huge, it's significant. i mean, we are near all-time highs in the indexes, nasdaq included, you know, i don't know if that makes it tougher for people and can't deny there's been strength in the market. >> one way of looking at it, the market is not letting you in. if you thought it was going to hold and waited for a better entry point, it is not done so. a lot of studies looking at the similar periods and a month and the market very, very little movement and very narrow range, typically down the road resolves to upside and short term seems

like it's coiled up for something, a little bit of a gut check. >> the issue is coming up, rob, the august 24th anniversary of what happened last year with that little flash crash in the morning. etfs. pisani is talking about the changes to make sure stocks open more quickly, the gaps don't happen so much and that can happen in a vacuum. >> that's like a technical glitch problem and not necessarily the big pictuturpic. we seem to have a morphine drip of global monetary policy. i hear more and more talk. may be whispers but, you know, of well, maybe we'll try and more negative interest rates. maybe there's -- you keep thinking -- >> who's whispering that? if you look at the evidence so far -- >> but it hasn't come out but you keep seeing sort of important policy makers discussing theoretically how it might work and i mean, i'm not sure where it ends but no reason

for you to think it's -- anyone's pulling away any sort of i guess is what they call the proverbial punch bowl. >> goes back to the guest telling us at the end of the hour and used the phrase regime change and talking about janet yellen on friday basically saying if we're in a different environment, finally acknowledging, growth isn't that great, maybe only raise rates once a year or inflation could go further? >> that would be the big structural secular stagnation approach that says that, you know, neutral rates lower. on the other hand, really strong european pmi indeexs today. seeing signs of -- even an interim pick-up and the talk we agree the trend forever in terms of central bank orientation, the surprise is even talking about, you know, shutting off the spi gots a little bit. >> the usda that looks good for the third quarter. >> oil prices up year over year. >> absolutely. taking a look at the home sales

data. welcome, steve grasso. >> thank you. >> fourth biggest month over month jump since 2000. swings all over the place. there's the least supply in the market in three years. >> right. i think the bigger thing is everyone wanted to see you had a couple of months of that trend moving up, upward and people weren't willing to say it was positive just yet. >> right. >> i think today people are willing to say that it's definitely a trend worth noting and it was interesting, the strength and the under $300,000 range which caters to kb homes or they kate tore this. >> shares doing the best -- >> i should say i'm long kb homes and pullty. >> look how great it's doing. >> pat myself on the back. >> no but we saw toll brothers and had earnings and doing quite well and interestingly, too, back to the discussion, goldman increases third quarter forecast of gdp because of this better than expected report. i mean, and you go back to what

happened with best buy this morning. what is home depot telling us? >> we know that janet yellen looks at these reports. right? and looks at home sales. but i don't know if it really matters truth be told to what the market is looking at from what she will say because we're focused on it but we become so numb to the fact of we like to trade off of it, the volumes lower. so maybe we're not -- we're poised to wait, poised the wait, wait, wait and then we get back to trading or not trading again. >> the point i was trying to make, rob, seems strange right now in this week to hear something dovish out of yellen and the fed and stagnation and like, hey, finally the data's looking better. >> but in the grand scheme of things, even if it is and it's sustained and we don't hear just dovish stuff, she sort of points to some of the more bullish indicators, we are still talking about 25-basis increase probably

by the end of the year, two 50 basis points for the cost of money, still ridiculously low. right? i mean, still not a reason to run away from a stock market or into a stock market. it doesn't -- sort of almost meaningless. >> more interesting to see if they don't raise even that little blip. if they don't raise, why they're not raising. why are they so concerned? >> frightening, though, right? >> four rate hikes a year in january the fed vice chair was talking about. what do you think is happening in terms of sentiment? do people think going back to the some of the fed speak we have and kaplan is a good example, they sound like an individual basis maybe more hawkish. >> i think the burden of proof for the market is high right now to think anything besides the fed's going to wait until the last moment. in other words, yes, they'll say interesting what you had to say, stanley fischer, but we know what you think because we have known for a listening time and until yellen basically gives you

a synthesis, i don't think the market moves that much. treasury market doesn't really budge. >> great point. let's talk some tesla then. new versions of the model s and x vehicles just about a half hour ago. phil lebeau rejoins with us the details. >> reporter: all about the battery and the news is significant, especially for those who have said, when will we see an electric vehicle with a range of greater than 300 mileless? meaning, fully charged you can drive at least 300 miles w. the new battery pack tesla announced, 100 kilowatt hour battery packs, bigger, more powerful and increase the speed and the range. what are the specifics now for those who are buying a model s or an x with this new battery pack? only offered in the performance version so ludicrous mode. range, 315 miles and in ludicrous mod with a model s, 2.5 seconds to go 0 to 60. the price starting at $134,500

as for model x, range not quite 300 miles but 289 miles is a healthy improvement. the 0 to 60 time below 3 seconds to 2.9 seconds and there's the price starting at $135,500. here's elon musk within the last hour talking about how many of these more powerful 100 kilowatt hour battery packs tesla can build. >> we think we can do about 200 cars a week. or 200 packs a week right now. and we're working very hard to ramp that up as quickly as possible. so, you know, somewhere on the order of 10% to 12% of our volume. and that's as much as we can figure out how to make. >> reporter: and over time, they expect to make more as they increase production. you see the shares selling off after the news came out. still ending up higher and not as high as they were earlier in the day.

i think that's the reflection of the sign people earlier in the day looking at the reports of tesla announcing some type of a product thinking it would be a new product. well, it is a new product looking at batteries but it is not an all-new version of a vehicle. that's typically not how tesla does those announcements in terms of new vehicles so it's significant especially looking at range topping 300 miles for the first time. >> there's raised eyebrows in a good way on the floor here. guys saying, wait, how fast will it go? stay with us if you will. we want to bring colin rush into the xafrgs from oppenheimer. we talked about your disapproval of the merger and coming to this latest move in terms of the autos business, what is your resanction? >> these are the incremental battery improvements we have been expecting. improving the capacity is an impressive feat from an engineering standpoint and this

is, you know, a capability that we were very excited about. with the auto platform to do these things and roll the products out but like you said, we are not convinced on the return of capital. you know? opportunity for them with the solar city acquisition and still sitting on the sidelines with the stock here. >> what do you think this move, colin, could do in terms of sales rate and their cost as they now add this to the product line? >> you know, i think we see it as incremental expansion on the high end. folks that looked at the products and looked at these very, very fast cars, you know, want to see the fastest car in the world in their grand juries a en and so i think they pony u for the battery and likely spend the extra 7% incremental price for the extra performance just to have it. >> colin, it is steve grasso. when the market shrugs off and see the investors shrug off

every production fail and then he comes out, elon musk talks about another production schedule and it shrugs it off and the stock doesn't do anything, when's that mike you think? is it bullet-proof at this point? what are people focused on that i'm missing? >> i think people are focused on shipment and cash flow on the stock from my perspective. i think there's the true believers in charge of the stock here recently and then certainly a lot of folks skeptical. the borrow dried up on the stock and so it's been very difficult to short and a tightly wound stock and i think what is going to drive the stock higher or lower here is reaching the production in the sales targets and then reaching the cash flow goals and ultimately we want to -- they have made very big promises and come through on much of that but cash flow is what we're waiting to see and i think that's the thing that folks focus on in the next two to three quarters. phil?

>> i think few of the questions on the conference call, people would be hoping they would be addressed by elon musk and they were not. not here to talk about the model 3 and general comments of a good vehicle. it will be priced right for the massives, blah blah blah. all of that stuff you expect him to say and not material in terms of what's happening with the development of the model 3 and the other topic he said i'm not going to talk about it is auto pilot and might tie in with the 100 kilowatt hour battery pack and two topics i know earlier in the day a lot of people were saying, will elon musk address those at all? they stayed completely clear of this. >> colin, i have a question for you. i've heard a lot from tesla about how they want to be viewed as an energy company. right? that's been their justification for this somewhat ridiculous deal to acquire solar city. this sort of seems like an

attempt to show, no look, we have the technology and feeds through to the car. i mean, if you were to think of this as an energy car, would you close to value it the way the market does today? >> i don't think so. the stationary energy storage market is going to be a highly regulated industry just like utilities and the thing we're excited about here is not regulators energy business on the customer side and there's some flexibility is where there isn't a form factor and real constraint it is the fact of getting that much power into a small form factor for the mobile market and really exciting and has an awful lot of applications that have significant margin and higher returns on capital. >> we'll leave it there. a lot to think about. thank you for joining us. appreciate it. phil, thank you so much for bringing us the news. phil lebeau with the latest on tesla. steve, thank you for joining us on the floor and let you get ready for "fast money." catch steve and the rest of the

crew coming up next hour. ahead here, amazon stepping up the subscription music offerings. until now, amazon music only available for prime customers but getting set to offer a new music only service for five bucks a month to echo users. how it could change it next. hillary clinton with a plan for small businesses and new tax deductions and details coming up. i'm just a guy who wants to buy that tr

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welcome back. echo users might be able to ask the device to stream music from a new service. amazon reportedly working on a service to only work in the echo hardware and cost just $5 a month. jon fortt has more on the story. hey, jon. >> reporter: hey, kelly. yeah, service is still rumored. amazon has not announced it but partners caught wind of the fact they want to make it happen. what's most interesting? price and the limits. on the pricing side, it's $5 a month. half what other services cost. but you wouldn't be able to use the service on the go. it would stream only through amazon echo devices and too bulky on a jog.

odd way, that actual limitation is key. spotify and others able to cut deals with the industry that allow more streaming flexibility on the pc because people primarily like to listen to music on mobile devices these days and labels might believe people unlikely to abandon other subscriptions to stream through the echo alone and amazon might be up to an on-ramp to a $10 per month service that streams through mobile devices starting to organize on amazon prime music and then for a little more, through the echo and might be more likely to use amazon for all of your music and pay full freight, kelly. >> all right. stay with us, jon. is this the next front you guys think? like the $5, $4 streaming service? do people care if it's not on-demand? >> i don't know it's the end point of amazon's strategy. i don't think it's about the price point and just creating a music service. i think to sort of what jon was

saying and you have to wonder if amazon wants to be the organizing of all of your media type play, a lot of people said maybe streaming is the front end of whatever over the top services, not just music but everything else. i don't know. that's thinking several steps down the way but clearly amazon's m.o. is if you do something, we can do it better and cheaper and this is an attempt in that direction. >> i see an opposite of apple doing. apple having to sell services because it's got to slow down on hardware sales. i mean, this is like a strategy of by the way it's an amazing product. right? >> do you have one? >> i do. it's the summer sensation in my home. you say play blah blah blah from spotify or -- just -- it's actually amazing. >> would you sign up for the music service? >> no, i wouldn't probably but if i didn't have one but i might buy one. >> wait a minute. you have an echo and still not going to sign up for the music?

>> i have spotify and the prime thing, you know, it plays -- there's a big difference. if you say play the smiths, you know, it will go playing from the amazon prime and not as good as spotify. no question. i think -- >> kelly? >> they're about selling the platform and an inducement to get people to do it. >> last word, jon? >> i think part of what's happening here is free part of streaming going away. the music industry doesn't like it. spotify grew on that but they're really putting pressure on providers to do away with free versions of stuff and companies like amazon having to figure out different sorts of tiers to entice customers to paying more for full freight music. they say buy cds from us, downloads, you can stream through prime music. now they're adding other tiers to that whole picture to get people into the ecosystem. just might work. >> do you have an echo, jon? >> i don't. and i don't use spotify either but i do use amazon prime music.

i download occasionally of itunes, pandora. pandora's coming out with more paid options, too. >> right. >> for some of the same reasons and a battle coming on toward the end of the year. >> i'm thinking about that echo. thank you. that's jon fortt with the latest. michael beal warned us the growth of la-z-boy was slowing. >> the stock falling after hours here. kelly, earnings of 28 cents missing expectations by a penny. revenue also below consensus at $341 million. the estimate was for $359 million. but perhaps what is more concerning is same store sales for the galleries declining 1.9% versus an increase of 5.3% in the last year's first quarter. the ceo in the press release says they have experienced flat sales for the quarter due to weaker demand at wholesale and inconsistent traffic throughout the furniture galleries.

the stock again now down almost 17% after hours. but keep in mind shares still higher by around 25% year to date. but nonetheless, a big move here, kelly. >> thank you, seema. one that's really interesting in light of best buy's number this is morning and you were to say the correlation should hold, that's the opposite ways. >> maybe all in recliners. but to seema's point about the stock kind of behaved going into this, it brings it back with the decline of two months ago so it's obviously run-up and people excited about home related retail and didn't live up to this. >> this is the time. if everybody's right about this cycle, they have to get it right. hillary clinton can't seem to shake e-mail scandals. a new batch of e-mails showing a clinton foundation official seeking access to the state department when clinton was serving as secretary of state. what it reveals and could impact the run for the white house next. and those new home sales rose to the highest level of

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that's liberty stands with you™. liberty mutual insurance. welcome back. presidential nominee hillary clinton laying out her small business plan, including new tax deductions over a conference call of various owners across the country. john harwood has the details.

john? >> reporter: hillary clinton is planning this small business aid plan for sometime. today she offered the details. let's run through them quickly. they include incentives for state and local governments to speed licenses of new small businesses, wants to provide a standard tax deduction like individual filers have a deduction for small business owners and wants to make it easier for businesses to get licensed, have the tax deduction and get loans from community banks. community banks have some restrictions on lending and wants to make those easier. part of the message is positive on her own plan. the other part she had the conference call. tim kaine with a roundtable in colorado and he laid out a small business attack on donald trump. >> donald trump has a kind of a track record, frankly, stiffing

small businesses like my dad's or hillary's dad's. businesses, you know, sign up with excitement. contractors, architects, marble installers, drywall installers, landscape professionals to work on major products, casinos or golf course headquarters and clubhouses and then what they find so often and there's many examples of this is they get to the end of a deal with donald trump and then trump says, okay, i got what i need. i'm going to say you 10 cents on the dollar. >> reporter: donald trump's reaction, of course, is that he is going to cut taxes and get the economy growing and also pushing the message today that hillary clinton needs a special prosecutor to investigate the ties between the clinton found decision and her work at the state department, some of which is highlighted in the e-mails that have come out. kelly? >> yeah. exactly, john thank you. hillary on the campaign trail in california and facing the scandals of washington, d.c. the latest batch under investigation from the time as

secretary of state focuses on donors and whether they were granted special state department access. eamon? >> reporter: hi, kelly. more drip drip drip on the clinton e-mail story and could have been that way through october and the different groups investigating the e-mails and releasing them on their own timetables and not controllable by the campaign. start with yesterday, judicial watch put out 725 pages of state department documents yesterday as part of its investigation, a citizens united, another conservative group, they put out 173 pages. these were of cheryl mills phone logs and detailing the messages people calling in and out to a key aide to hillary clinton. also, on monday, a federal judge ordered the state department to speed up the e-mail release as of september, a deadline in september so we expect to see more e-mails coming out of state department by that deadline and the fbi we found out discovered

15,000 new e-mails not turned over as part of the production to the state department. all of that yesterday. just today, citizens united released 378 pages of new e-mails that detail the world of money and access over at the state department, indeluding this e-mail to show you the world that these state department aides lived in. this is an e-mail of huma abedin and she says the problem is abigail disney keeps e-mailing hrc, hillary clinton directly and quite anxious to talk. disney obviously a member of the famous entertainment family with a direct pipeline there to the secretary of state to talk about the concern of women's concerns. now, the clinton campaign not buying it's a scandal. a spokesman tweeting out yesterday, the foundation is a charity that helps people around the world. it's already announced major steps to take if clinton wins. kelly, just within the past hour or so, the associated press putting out a new story, their investigation finding more than

half of the people outside government who met with hillary clinton as secretary of state also gave money to the clinton foundation. that is a story that's going to get attention through the afternoon and into the evening, as well, kelly. >> not to mention you have the clinton global initiative next month to put them front and center anyway. thank you. we have a news alert on madison square garden. seema, what's happening? >> reporting a 5.1% passive stake in madison square garden. we're not really seeing shares move. interesting development nonetheless. >> we were talking about the investment in square, they bought about a same-sized 4.5%. this one for msg. >> a real -- a hedge fund stock. this is a play thing of hedge funds. a spinoff of a spinoff. it makes some kind of sense. people think there's a bid ask

of the stock's valued at and the say sets and interesting play. >> a lot of different moving pieces. >> all long island guys. you call in and -- >> well, by origin and stamford. >> across the -- >> grew up reading -- >> connecticut guy. doesn't take anybody. >> we don't accept him as a member of the connecticut, you know, hierarchy but, no, certainly he probably knows it. >> shower. time now for a news update. let's get to sue herera. >> here's what's happening this hour. secretary of state john kerry meeting with nigeria's president for talks on how to beat hoboko haram. iraqi security forces launching a push to push into mosul and met by the militants stationed at various entrances to the town. back here at home, you saw tim kaine campaigning in colorado promoting the clinton

campaign's small business plan while taking swipes at donald trump's record. he toured a business that makes precision machines for aerospace and medical companies. and here's your inspiring story of the day. it has been a year since then 8-year-old 12kion harvey received the world's first bilateral hand transplant at the children's hospital in philadelphia. well, today, the hospital held a news conference with zion and his mom to discuss the strides he's made. they include throwing a baseball, writing, preparing himself lunch and managing the zippers on his clothes. and he's looking forward to school. >> that's fantastic. >> that's the news update. isn't that great? >> yeah. >> my favorite story of the day and he just keeps improving so always nice to leave on a high note. >> thank you for bringing it to you. see you tomorrow. the price of an epipen spiked more than 500% in the last decade. 500%. with some customers paying upwards of 600 bucks for a pack

of 2. the ceo will join us with the take on the price hikes and who should be paying for it. we'll be right back. oh watson, your japanese is very good. thank you. (speaking japanese) exactly. i can understand nuance, context and idiom in seven languages to help companies all over the world with everything from retail solutions, to banking, to cyber security. (speaking japanese)

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receiving criticism and backlash for increasing the price of epipen drug more than 400% since acquiring it. when we spoke with the ceo in may, rob cox on the panel then and today asked her about the increase and what makes mylan different from other companies raising drug prices. here's her response. >> what we have said and committed to make our sure and the street and community understands, the investment community, where our growth and why we're different. i would start by saying when you look at the investments we have made over ten years, putting a manufacturing platform, in fact, we were criticized for years investing too much in cap-x and r&d and people and bringing the first generic advair to the market. the acquisitions broadened the footprint, broadened dosage forms like injectables where we didn't have krital mass and

sitting here today we believe we have a platform of over 1500 products. it's truly second to none with the global supply chain of manufacturing what we're selling and huge differences between that and slashing costs, slashing r&d, slashing jobs and raising prices. >> joining us to discuss the state of drug pricing is ron coheb, ceo with meg tirrell here at post 9. ron, listen. it's interesting in a way that it took so long for the focus to shift to mylan as this is happening for sometime. people are going back to school seeing the price hikes here and now probably certain that this is indemonstratic to the industry. what do you say? >> well, it's not indemic. there's a bigger picture and getting missed here because people trying to pick one

example out of thousands and then make a generation out of it and one example may not be all that meets the eye so at this point in the story it just seems like people are willing to just accept willie nilly that the drug industry is doing terrible things, profiteering all this. i've been doing this for 30 years. i started as a physician. the drug industry, mostly, people going to work every day rying to improve lives. >> meg, the price of this epipen we are showing it there, and this goes back five years and when they got it in '07 something like 50 bucks? i mean in that range, maybe. maybe under $100 let's call and now over 600 and a high profile case of what people say is, is there a reason for the price hikes? just happen in a vacuum? >> they don't happen in a vacuum. when's interesting about the epipen situation is lack of competition available for the drug and though it is, you know,

an old chemical, epinephrine in the product, generic competition hasn't been able to crack it here and seen the price rise as a result of that. ron, in your role as chair of bio, bio and pharma taken steps to distance the rest of the industry from companies like valaent, like turing saying that's not the drug industry and what point do price increases become too much? when does it become egregious? >> so, so, i think it's important to understand that we in the united states have the best system for developing medical innovations and progress that's ever existed and continues to. we produce 60% of the world's new branded drugs in this country with only 4% of the population and that's because overall the system actually works. and you have to look at it and say, how does that system work? the way it works is that to develop a drug successfully, next drug for alzheimer's disease or breast cancer or

multiple sclerosis better than anything coming before, on average takes ten to 15 years. hundreds of millions of, billions of dollars and nine out of ten fail. >> ron, i love you. i've heard your talking points. we have to talk about drug prices. >> here's the thing. yes, prices can be objectively high. but in order to get people to invest in that kind of a system, for ten to 15 years, they have to get a high return on the investment. otherwise they're going to be investing in the next version of this, which is great. but it's a less risky investigation. >> okay. but condemning certain drug companies and saying they're not part of the industry, where's the line? >> well, so in the case of mylan, this particular case, we have the look at when's going on. i think you alluded to it. it is far in excess of what we normally see in our industry in terms of annual price increases over several years and you have to say as you did they're one of

the very few providers. i think one other provider and one question i have is, why isn't that product getting more play? because consumer reports says you can get that product for $140 at sam's club. right? why isn't that getting more play? second question i have is, why don't we have more generic entrants? the way the system is supposed to work is you innovate a drug, you get it 10 to 12 years and a high return on that because you have to to get people to invest in the future, but then it goes generic and we have to sign up for that and say, once it goes generic and the patents are over, we should have a robust industry to compete and lower the price. >> that's the argument of mylan making with the discussion a couple of months ago saying it's a specialty pharma company. the generics company say we have to price it a couple dollars below and no reason to offer

this thing 90% off. >> not if you're the only provider but four providers on average when there are four providers, the price down by 60%. if there are eight providers, down by 80%. and by the way, most drugs that have ever been branded 90% prescriptions today are for generics and overall the system does work. the problem you have is when you have a one-off like this where for whatever reason not more generics on the market and there are things that we could do to make it easier for generics companies to compete in these spaces. >> well, okay. do you -- just pulling back here. we keep hearing about these e agree jous examples. might be one here or there. but they keep coming. at what point do you worry your industry is sowing the seeds of its own demise and effective lot not just donald trump calling for single payer negotiation but everyone out there paying 150 bucks every year at school time

because the kid has a peanut butter allergy? aren't you worried about that? >> very worried. very worried about it and worried about it in particular because it's taken on a life of its own and not based as much in reality and data and facts as it needs to be. the reality is that if you look at our health care system overall, hospitals, diagnostics, doctors, all of that, it costs more in this country than it does anywhere else. >> no competition. >> no, no. that's not why. >> there is truly a competition problem? >> it's a railroad complicated subject but the reality is when people come out an say, you know what in drugs cost twice as much here as europe and so do hospitals and sometimes three times as much for hospitals, right? drugs are not out of line. my point is, we have a systemic issue about health care delivery in this country and people if they focus only on drugs, they're focusing on the one part that's the most innovative. we need to pull back and say,

how do we get people access to the most effective health care, whether it's drugs or procedures or anything, and pay for that based on the value of what we're getting? >> ron cohen, thank you for joining us down here at post 9 on a day when it's very, very much in the news and don't expect it to go anywhere just yet. meg, thank you. millennials are not buying it, referring to homes in this case. homeownership rates are down. our next guest says a good thing. she'll explain why. ♪ using 60,000 points from my chase ink card i bought all the framework... wire... and plants needed to give my shop... a face... no one will forget. see what the power of points can do for your business. learn more at chase.com/ink

see what the power of points can do[chains dragging]s. [eerie music playing] [crickets chirping] [owl hoots] announcer: if you don't fix them, sparks from dragging tow chains can cause a wildfire. and that could be scary. bye, smokey! only you can prevent wildfires.

♪ welcome to my house new home sales soaring in july. no thanks to millennials, though. u.s. census bureau finding 34.1% of americans under 35 owning a home and down from 2010. but that's not necessarily a bad thing as katherine rampel writes. she joins us now to explain why. welcome. >> thank you. >> here's my question. is it that we're glad they're not buying homes because that's seen as a poor financial move? why do you think they're not buying homes is a good thing? >> two main reasons. one is financial in that i think as a nation we very much overstate the value of buying a home, from a financial standpoint. not a psychic, sentimental being part of the american dream, that kind of stuff. but, you know, if not for those

aspects, hard to imagine a financial adviser, for example, telling you to sunk 100% of your savings in a liquid asset and very low return. like if you look at the -- >> i know some but anyway. >> on average. right? if you look at the rate of return for housing, over the last century, it's less than a percent on average per year f. you put that money instead in the s&p 500, you would be much better off. so from a financial standpoint the fact that young people are not putting the money in these assets is not so bad. the other point that i would make is that we want people to be mobile. we want people to have as few frictions for changing jobs as possible. you know, there's a lot that's been said about job lock. that's the term for it. we have tried to reduce job lock with health insurance, for example. housing has the same effect. for young people graduated in the recession, started out on a low-paying career trajectory,

you want them to be able to hop into a new job with as few frictions as possible. the fact they're relatively rootless, let's say, living with parents or renting or whatever, it makes them more mobile. >> so what happens if, it looks like and home depot told us this. they're six years behind. so if people start to buy homes because they still want to, all that fuzzy social stuff you're talking about, is that something to potentially worry about? >> no. i think when they're more settled in the careers, it is not so worrisome and it's more emotional benefits to homeownership and looking at the data, survey data show that young people still very much want to own, you know, they're not part -- not a sharing economy mum bo jumbo. they very much want to own. maybe it's six years later but at that point more settled in the career, hopefully they will have had more opportunities to hop on to a better paying career trajectory. >> yeah. >> and at that point in their career it wouldn't be potentially as damaging or as

freezing. >> they can't afford the rent payments in the urban center any longer and doesn't make sense. >> thank you. well, a come bs back tale. gone not too long ago then a funny thing happened. we'll look at what's behind the bounceback, next.

shares of best buy closed up nearly 20% today. the retailer beat in earnings on both top and bottom lines, but also showed a surprising increase in same store sales and raised earnings outlook, but does it justify a 20% increase

in shares? >> it's a cheap, cheap stock. if this is the none earnings run rate, the july quarter for best buy er is not the make or break so clearly, they have to have a decent holiday coming at the back end of of this fiscal year, but it seems like trading at 11 or 12 times earnings, it seemed like it was sort of a step function, okay, things are on a more stable path. but flat top line, we're not talk iing about a story m just slightly bert than expected. also, the tok has just gotten back to where it was last year. >> missed some of those. >> it's kind of like they've proven that as a way the survive the amazon onslaugt, but there's no growth in top line year over year. they have managed to increase their share from online, which is good, but it's really the showroom model. it's keeping people coming in and like, oh, please buy something while you're here. maybe not an amazon echo, of course, but it's sort of like a survival strategy, rather than a

growth strategy. why would you pay more than 12, 13 times earnings. >> since 2001, just incredible staff. lazy boy going the other way. california's largest casino is undergoing a major expansion. it's not just a gaming floor that's getting larger. jane? >> at a casino, get home, oh, man, i left my prosthetic leg behind or my bag of sex toys or the drone. we can relate. up next, we go inside the belly of the beast and a larger lost and found. stay tuned.

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as they say what happens in vegas, stays in vegas and what's brought into california's largest casikwascasino sometime there, too. jane? we all though. we went inside california's largest casino, where you have to feel for the maids because they find everything and i mean everythingne inside the hotel roomses between the rooms and casino. now, as they spend $285 million to expand and add more hotel

room, it's going double the size and staff of its lost and found, where pretty much if you can imagine it, they have seen it. >> i was going through a backpack that someone had left and i actually found the remains of his mother. >> i know we've had glass eyes turned in. we get walkers. we get dentures. >> yeah, dentures. >> we get things from hotel that are pretty gross. >> adult toy sns. >> yes. >> okay, everything is held on for 30 days and if not reclaimed, it's donated. probably not be adult toys. also things like a drone, prosthetic leg, portable toilet. $18,000 in cash, $9,000 ring. more gori details on cnbc.com including the joy they feel when they return things to people who have lost them like mom's ashes. back the to you. >> mom's ashes were at a casino

lost and found? >> the guy, i guess playing the slot, maybe that's where mom wanted to end up. he was playing the slots. left his backpack. got collected. she opened it up and hello. they had to call the coroner for that one. >> got to bring your good luck charm. >> exactly. >> what is going on here? >> i don't go to casinos. not because i would leave everything. because i would lose everything. i have a strong track record of 30 years sober oni casinos. >> the bright side of how to view this is this people win big and say that just leave that stuff behind. >> mom's ashes. >> sex toys. >> yeah. oh, my gosh. >> some people snort remain, right? was it keith richards -- >> no, no. jane, we thought -- thank you. >> jane wells, out there in california for us. >> speechless.

>> yes, we all are. that does it for closing bell. we have still friday januaryet yellen on more serious issues. rob, mike, thank you for joining me. "fast money" begins now. live from the nasdaq market in new york city's times square, your trader is -- tesla backing off. just as elon musk reveals major upgrades to s and x. why aren't investors excited? plus, cause for concern. two recent ipos are starting the to look similar to go pro and shape shack. the names and what it could lean. later, amazon planning to launch a new ad free music k streaming service at a super low price might the impact be? cara swisher wilha