hi, everyone. welcome to "on the money." i'm becky quick. is the correction coming? the global hot spots that have the marketers in vows and what you can do to protect your money. the lessons some sixth graders can teach us object investing. and is betting on your own ideas the best strategy? from povero prosperity, to help the poor to middle class. >> you hang around them and you'll be the tenth. if the markets have you nervous we have the best. here's a hint. it's not under your mattress. "on the money" starts right now. here's a look at what's

making news as we head into a new week "on the money." stocks had a severe case of the jitters all week with the s&p finishing at the lowest level in more than two months on thursday. and the dow closing at its lowest level in more than three months. the markets have plenty to worry about from worries in russia and new u.s. involvement in iraq. but stocks rebounded on friday. the flight to safety saw the yield on the u.s. treasuries fall to their lowest level in over a year dropping below 2.4%. it was big media's turn to report earnings and the news was good though viacom fell short. disney did better than analyst expected and 21st century century fox and time warner did as well. two big deal as peer to have fallen apart including a possible megamedia merger. rupert murdoch and 20th century fox says they will no longer pursue time warner. and sprint walked away from a possible teel with t-mobile. and they say it will not reincorporate in a foreign

country to lower its tax rate. that practice known as an inversion, is the controversial one. walgreens faced political pressure after announcing it was considering a move like that. it hadn't exactly been a typical sleepy summer week for the markets. jitters about the middle east, russia and maybe even a correction all conspire to make for some volitity. brie brian jacobsen and jonathan golub, thanks you both for being here today. >> thanks for having us. >> looking around, things feel much more ununeasy than they have in quite a while. is that the beginning of a correction, brian were or are things go to improve sn. >> i think things will improve. a lot of what we've seen has been driven by geopolitics and people's fears by what that means about the companies they're investing in is sanctions against russia and the tension in middle east will that lead to lower profits to businesses whose stocks you own?

i don't think it will over the longer term. what we're seeing right now is just sort of a cloud over the markets in general in terms of sentiment. if you look through the cloud and look at the fundamentals of the business you're investing in the picture is brighter. >> jonathan, how about you? >> i think we're on the same page. you see earnings season, our company is doing particularly well. yet, stocks are, you know, off. 4% off. given this tremendous bull market run, so not particularly concerned. stocks are cheaper now than they were at the beginning of the year and as brian said, i think when we get through some of these near-term jitters the markets are higher at the end of the year. >> maybe that's the point. we're not used to this kind of volatility. we've gotten used to stocks going straight up. brian, i wonder, what are you hearing from clients? athe they nervous? >> a lot of them are. that's what really characterize this is as being a bull market correction where it only takes a 5% move down to get people

feeling as though it was almost like a 15% move down. so you sort of get lulled into the sense of come plcomplacency. and suddenly you see things drop and people panic and that panic is going to be very tempered. >> jonathan you're right about stocks motoring along in terms of what the companies are doing. very good news. the other point is, when you look around, there's too many other places put your money. we look this week at the ten-year treasury trading below 2.4%. i didn't think it could get that low that quickly but between that and the german trading at around 1%, what does this temperature you? where else do you go? >> i look at a little bit differently as a strategist which is, how cheap or expensive stocks versus bonds? or what does fair value for stocks given what they're costs of capital? their cost of capital is an interest rate? and stocks are trading probably something more like 17 to 19 forward multiples to trading right now at about a 15 for ward

multiple which means this probably just very substantial upside and you know, you hit it where else do you go? once we get through some of this cloudy issues, i think we get back to that discussion on stocks are cheap. the earnings are showing up. >> let me ask you both. we're writing off some of these geopolitical terns at this point. what is it that would make you re-assess that whole idea? is there a headline that could hit that could make you change your mind? >> we've done a whole bunch of work on this and by and large, unless the u.s. is in some major, you know, involvement, it really doesn't affect markets that much. if you look at the tell view stock exchange you think, oh, my god. it's been up because ultimately, what investors do is look forward and say, are these good companies? are they affected by the outlook? what's the future path? the future path is fine and healthy. there are a couple of things that are problematic. the european economy is

legitimately weaker and you're seeing that in their interest rates and that, i think, is weighing on things which is really the economics rather than geopolitics. >> that did come out of left field to see it will go back into a recession. two quarters of a row of declining gdp. that means things aren't completely fixed? >> they're not completely fixed but they're getting better and that's the thing to focus on. the market if you think about the way in which investors behave, they look forward. what about our expectations. people are expecting italy to have very slow growth, what matters is what is reality relative to those expectations? i think that what the european central bank coming out and saying that they're willing to do quantitative easing they haven't begun the new targeted long-term refinancing operation. >> talk, talk, talk. >> i'm going to take opposite side. if you look at the way the market responded the last time mario spoke, the market was off -- european stocks were up by 1.5%. they were telling mario, to your point, becky, you got to show me the money otherwise i'm not

going to -- here's the then. they will, come september. they already have it. i think that's the key thing. it's all based on -- and that's what makes the market. >> but a different perspective. i think come september when they do the first auction of these targeted long-term refinancing operations and consider that the european banks will get through their asset quality review, their form of stress test, they'll be in november, you're going to have banks going from being a drag on growth to contributing to growth at least. so i think that there's actually tremendous upside potential relative toi expectations in the european market. >> brian and jonathan, thank you both for being here. up next we're "on the money." ever hear the advice, wrooit what you know? if the market gives you jitters investing what in what you know could be the way to a better return. an approach so natural it's almost child's play. and fighting poverty without government help or charity? you can bank on it. as we head to the break, look at how the stock market ended the week.

is the average sixth grader a better investor than you are? kids may have the approach to portfolio management that pays off. buy what you know and understand the world around you. hardeep walia is the founder of motif investing and hardeep, thanks for being here. >> thanks for having me. >> this is a platform that lets you pick things you know and understand. how you feel about the world around you and come up with a stock plan that fits that. you subsequent to a sixth grade class and what d t of it as pet meets jack bobo. we went to this school in fargo, north dakota. and we were surprised. we had a tournament going on for the business schools and this school decided, this group of sixth graders decided to compete with the college grads in a

competition to build a motif. we learned what peter lynch told us a long time ago. keep you're ayes opened to the world around you, keep costs low and diversify and understand risk and these kids were able to outperform some of the best schools in this crew. they were picking things they understood. one kid picked under armour. last year everyone was wearing nike. this year everyone is wearing under armour. christmas was approaching and they were sponsoring the olympics and they told me the stock was cheap at the time. so facebook, something they actually were not using that much, these were sixth graders. more of an instagram crew. they said, look, kids, mr. zuckerberg is a smart person and he'll eventually figure out how to make money on the mobile dies so we think it's a good time to buy facebook. >> it's interesting. not only what you know but the people you trust and think highly of? >> absolutely. and what we've learned through the who proprocess at motif is investing one of the biggest mistakes investors make is they

don't know what they're invested in. you put money in a lot of fund and you have no visibility and and there's a new crew of younger generation that not only want to understand but put their values to work. if you take someone that's into green investing they may not want to invest in shale. someone like myself i think it will solve a lot of energy problems and that ability of knowing what you investing in is a very powerful thing we're seeing emerge. >> let's talk about some unusual event happening around the globe. what are some of the motifs someone could partly cloudy up on? let's say you notice this outbreak of war around the world. is there a way to invest in that? >> there is. we have a motif called modern warfare. depressing motif but instead of conventional warfare this is geared towards drones. what you see and use, unfortunately. this motif is doing well. what you're also seeing is a response to this outlook on war is there's -- prices are up. when you look at shale, we have more oil technically in our

country than saudi arabia. the problem is getting it out of the ground and fracking becomes interesting. unlike oil in different parts of the world that's under risk, u.s. oil has the benefit of rising all prices but it's not as risky because the oil is here, homegrown. >> where do you think investing goes over the next decade? between motifs and things have changed pretty drastically? >> we're going to see the cost go down dramatically. one of the reasons our motiving do well is no ongoing fees. we give you an index. you may a one-time transaction fee and you can put as little as $200 or as much as $1 million and they're not these -- we always talk about the compounding returns. now we're focusing on the compounding of costs. take that out and i think it's about transparency. what people don't realize is when you invest in a mutual fund you don't know what you own. there's a lot of trust. this next generation, these millennials, they don't trust as much as the last generation did. >> hardeep, thanks for coming in today. >> thanks for having me. up next we're "on the

money." is capitalism the best tool to fight poverty? why it with h can help save the nation's poor. businessmen with big ideas. >> nothing changes your life more than god or love. move your credit score 120 points. later, the safest way to stash your cash and get the b

if financial little are si, knowing what to do with your money and when, if it were a

basic civil right what difference would it make to our economy? john hope bryant said it would make a big one. he's the founder and ceo of operation hope and author of "how the poor can save captainism." thanks for being here. >> there are grim statistics out there, something like 23% of our children in u.s. are living in families that are living below the poverty line. i think about everything that we've tried to do to fight poverty and just wonder, what have we done wrong? what's going on? >> the first thing we did wrong was define poverty. if you've make $50,000 a year or less in this country that's too much. that's half of america. if you have a co-worker who has lost his job and if your dad lost his home, you're middle class you feel poor. spiritually you feel poor. mentally and psychologically you feel poor. poverty is first and foremost, a state of mind. by the way, this same group is driving the large economy on the planet. 70% of this economy is consumer

spending and people make $50,000 a year take 90 cents of that dollar and put it back in the economy because they can't afford not to. >> you have said that you want to take financial literacy and make it like a civil rights issue. >> it is. >> how do you do that? >> president lincoln tried to do this after emancipation. after the civil war he got the most important thing he could do was to give free slave an understanding of free enterprise and capitalism. he created that an morning 3rd, 1865 and the banks fell in disrepafr and we didn't rery sit that conversation for 100 years with if poor people's campaign. dr. king was killed two weeks before the march on washington, which is about all races of people. because the only -- you deal with clashing race for free so my point is we manufacture got the memo. not like the poor and workings class families got the memo and screwed it up. they never got the memo on free enterprise and capitalism so we're winging it. the largest economy on the planet is winging it, when it

comes to growing the economy and creating jobs and giving people aspiration. people up in high school? not connected to education with aspiration. >> you point out yourself that the reason you know about so much of this is your father was in business 1234 you grew up in a household where this is mondayplace and it's taught it's a different scenario. >> if you're wealthy you get this this as part of your dna in you want your son in business. his dad is in business. why is it your son bought real estate in he saw his daddy buy real estate. why are they in stocks? they saw their daddy's do it. we're all role modeling. you hang around nine broke people and you're the snooent look at people with no banking accounts. 9 million american households don't have bank accounts. a serious problem with the unbanked. how do you solve that? what is a problem that it creates? >> you won't solve it by telling people you need a bank account. everybody goes to bed thinking, i want toy 20% subprime

mortgage. we want to become homeowners. at all levels of economic strata we're looking for love in all the wrong places. we have to tie the bank account to an aspiration. so in elementary school, give kids course in fooishl literacy. course in interprenoourship. course in self-help. 25 businesses you can start for $500 or less. and give the kids a picture. a shark tank for kids. when the kids get two minutes because that's life and they pitch and they win, we fund the business up to $500. >> this is not just talk. this is something you're putting into action? >> we're doing it. >> how many locations? >> we have 17. we have 100 locations in 250 days we're calling the adult version of this the starbucks of financial inclusion. the private banker for the working poor and struggling class and the teetering middle class and we put it inside of the bank branchs in the adult locations. we're in suntrust banks and pnc bank, region's bank.

bank of the west. and banks are not doing this out of charity. they're doing it because we are raising credit scores 120 points and nothing changes your life more than god or love is raising your credit score by 120 points so we're creating sustainable customers. so the people driving the economy need to be included in the largest economy on the planet and growing our middle class is the whole ball game. >> thank you very much for joining us. >> thanks for keeping the issue alive. >> thank you. up next "on the money", a look at the news for the week ahead. and cash is king. if you have plenty of it where's the safest place to park it? we have the answer when we come right back.

for more on our show and guests, go to our website, otm.cnbc.com. here are the stories that may impact your money. a big week of earnings from the retail sector. walmart, j.c. penney's, and macy's. the thursday, graceland will host its auction of elvis presley memorabilia. and friday, the producer price index followed by the industrial production numbers for july. and one of the seven modern numbers of the world. the panama canal will turn 100

years old. millions of investors use money market and mutual funds to stash cash in their portfolio and they're generally viewed as safe, convenient, short-term investments but there are changes on the horizon. personal finance correspondent sharon epperson joins us to explain the latest rules and tell this how this affects you. money market mutual funds have grown so popular u.s. investors park nearly $3 trillion in these investment vehicleless. but since the financial crisis regulators have been tightening regulations to ensure they're safe, regulations won't go into effect for two years but now is a good time for investors and consumers to side if these funds are truly the best place to stash the cash. >> i bring this up because i over heard this. i was giving a guy a hard time and i think he was wrong and i was right and they're not all the same. >> that's what's so confusing. you hear "money market" and you think they're all the same but

they're not. there are money market mutual funds. that's what the exchange commission has addressed in recent days. and also, there's a money market accounts and that's a bank account. like a saving's count so you have the money market mutual fund which is an investment vehicle and the money market account which is like ap saving's account. >> the s.e.c. rules only impact which one of these. >> the s.e.c. rules only impact the mutual funds. the money market mutual funds. two provisions. one that looks at the institutional money market fund and that's looking at the underlying value of this fund. normally it's pegged to $1 a share and they want to make sure people understand what it's truly worth and they'll have a floating value now for these funds. >> and they'll trade like mutual fund? >> exactly. >> that's a very big consideration because this whole perceived risk idea is part of what is breaking the buck idea is about and a run on the bank and that's what they're worried about. a run on these funds.

they don't want people to stampede out. >> that's part of the reason the government had to get involved. people did do a run opt banks and when it got broken people started pulling out their money and the government stepped in and said -- we'll cover you. >> so taking these withdrawals is another provision of the rule and that's looking at all money market mutual fund making restrictions on when they can be taken but they'll probably -- the withdrawals be 245i8 be restricted. >> how do i figure out what's right for me? >> you need to figure out what you're going to use the money for and then you can figure out where you're going to place the money. keep in mind it's money market mutual fund is for investment. if you want cash on the sideline, lots of folks want that in their portfolio so they can take advantage of a market move when it happens it's right there in your portfolio ready to make that move. if you want savings for the short-term, that's what a money market account is for at your bank. it's a little bit better than a saving's account in terms of y50ed because it invests in other things like treasury cd's. and that's still protected?

>> that's the key point. if you want to keep your money really, really safe you want to hake sure it's insured you need to have it in a money market account at the bank or a saving's account at the bank and it can be insured for deposits for up to $250,000. >> sharon, thanks for clearing up that question. >> sure, my pleasure. next week we take on the sweet smell of success with cinnabonment, kat cole. have a greet week and i'll see you next weekend!

. >> lights, camera, action! ♪ >> con sthsciously uncoupled. brad's red carpet attack. kim and kanye's multimillion wedding. all this in the first half of 2014. i'm shawne robinson. welcome to "access hollywood." the midyear roundup. the biggest scandals of the year so far. for that we go to bill. >> thank you. the year is halfway through. already, fair share of scandals. joining me now nimy guests. what's