MARIA-03
Reportedly Looking to Make Every Penny Possible Before a Generic Version of
the EpiPen Hits the Market; Investors Around the World Wait to Hear from
Fed Chair Janet Yellen; Security Warning for iPhone Users; EpiPen Loses
Star Spokesperson; Police in Brazil Summon Ryan Lochte Back to Brazil - Part 2>
Barnes>
Medicine; Politics; Election; Technology; Omaha Airport; iPhone; Mylan;
Fed; Donald Trump; Hillary Clinton; Immigration; Earthquake; Italy; Zinck's
Inn; Pine Bros; Ryan Lochte; Brazil; Jarrod Dyson; Christian Yelich; Matt
Moore >
MCDOWELL: One of the issues that Bill Dudley certainly sounded with Peter Barnes in that recent interview that Peter did with him, is that the investors are complacent about interest rates, particularly, if you look at the 10-year treasury. And the 10-year -- the yield ticked up a little bit, so there's a bit of selling in recent days. It closed yesterday almost 1.58 percent, but again, these are -- this is an incredibly low level for a 10-year, for an economy that is still growing. It's growing, slowly, poorly, but growing nonetheless. That's dangerous because you could see a snap-back in longer term interest rates, and you're talking about capital losses.
OTTER: But you pointed out that the GDX, an ETF have really fallen recently.
MCDOWELL: Gold prices.
OTTER: Gold is falling. Utilities have been hit.
SMITH: Can we get some commodities up and do a bit of a market check here as we're just less than an hour away from the open. And this is going to be a huge day for markets, GDP reading coming in in-line with expectations for the second quarter, 1.1 percent. Janet Yellen is going to be speaking from Wyoming, just about an hour and a half from now. Any indication that we're going to see a change in the interest rate environment in this country could be a big thing for the market. There you have gold prices, Jack, 1,330 a troy ounce, up half a percent.
OTTER: What is interesting is because gold is often bid higher when investors fear inflation. If the Fed were to hike that means the Fed is going after inflation. The gold trade looks a little less attractive by those lights, so that's why gold miners getting hit so hard earlier, utilities getting hit. These other Bond proxies getting hit suggest some investors think maybe the Fed would hike the 10-year bond and others.
SMITH: If we could look at currency too when you guys get a second. Obviously, currencies are going to be -- play a big part as we await any word from the Federal Reserve. Looking at the U.S. dollar up against world currencies could be a huge as well. Right now, by the way, global currencies are up across the board. Again.
MCDOWELL: You have to ask yourself, this economy hasn't grown faster than 3 percent in almost eight years. Do I think Hillary Clinton's plans to do more of the same, even juice President Obama's policies, how is that going to deliver a different result? That's the question people got to ask themselves.
SMITH: And Gillian, all this happening in election year, making it all the more interesting when you look at the Fed and this predicament on whether or not they're going to raise, and still what is this tough economic environment of just 1.1 percent growth in the second quarter.
GILLIAN TURNER, FOX NEWS CONTRIBUTOR: And as we're talking about earlier, trying to gauge how candidates who like Donald Trump, who are a little bit of a wildcard are actually going to behave once he -- you know, if he takes the reins in the oval office.
SMITH: And it's not just Donald Trump and Hillary Clinton. Somebody sitting with us right now likes to talk about those third party candidates. John Stossel is joining us right now. John Stossel, I want to bring you in on this conversation. I mean, we are sort of in a wait-and-see mode. I know you don't watch the market that closely day-to-day, but this is big moment as far as the discussion that we might see from Janet Yellen on whether or not they're going to raise rates by the end of the year.
JOHN STOSSEL, STOSSEL HOST: Why isn't there more discussion that we just threw $4 trillion into the economy, an experiment that never happened before.
SMITH: And where we are now.
STOSSEL: . and horrible things.
SMITH: Yeah, exactly. All right, so you are on a huge story this morning, and you have been on the story, Pharmaceutical giant, Mylan, under fire for their 400 percent price hike of this lifesaving EpiPen. All right. So Mylan had increased price of EpiPen since taking control of the drug in 2007. It is the timeline that has come into question in addition to the price. It sped up the price hikes after agreeing to allow a generic competitor to enter the market in 2015. And, there he is host of Stossel on Fox Business, again, John Stossel. Does this spike in cost for this life saving drug highlight a need for more government regulation? Let me guess what your answer is to that.
STOSSEL: Look, it's gross that the CEO pays herself $19 million, and she's got political connections. And my daughter has to have an EpiPen around because she has anaphylactic reaction, but I'm fine -- it's a private company, the FDA killed all the competition, said you're not good enough, and the more profit they make, the more other greedy people will enter the medical innovation field and maybe invent something that keeps all of us alive.
SMITH: So, you're saying it doesn't look good but you're not against the way this works?
STOSSEL: This is all we have. All innovation comes out of the United States. If government tells everybody what prices they can charge, people won't go into the field.
SMITH: Because Hillary Clinton said this would not happen if she was president.
STOSSEL: Right, no bad things will happen when she's president. And everything will be wonderful if Trump is president. That's why we need alternatives.
MCDOWELL: Her solution is more government. It is price controls -- let's talk about price controls on medicines and pharmaceuticals, and then what happens to innovation then? Will we see the kind of cancer therapies that we're seeing if you have more government -- the government telling companies what they can and can't do, and what they can charge for these drugs.
STOSSEL: You'll see a little, but you'll just see far less. Look, it is greed. So much of what they try fails. It costs a billion dollars, takes about 10 years to get it through the bureaucrats. To be incentivized to do that, you need a lot of profit at the other end. SMITH: All right. This is a big day for many reasons. Tonight, you're hosting a libertarian town hall right here on the Fox Business Network. We have a clip of Gary Johnson discussing capitalism. Let's take a look at that.
(BEGIN VIDEO CLIP)
UNINDENTIFED FEMALE: How would you help to support and raise free markets while working to reduce crony capitalism?
GARY JOHNSON, PRESIDENTIAL CANDIDATE: Most Americans, actually, have come to associate crony capitalism and free market as one in the same, when in fact they're opposites. Crony capitalism, pay-to-play is when government involves itself in business. We want government out of business. That's a level playing field. That's equal opportunity.
STOSSEL: How?
JOHNSON: I vetoed a lot of legislation that gave unfair advantage to business, as opposed to legislation that could have treated everyone equally.
(END VIDEO CLIP)
SMITH: I really look forward to seeing this, so what can voters expect to hear out of this tonight, John?
STOSSEL: You'll get questions from people in the studio audience, from the street, from social media, weird ones and normal ones. But isn't that refreshing to see a sane person running for -- you know, not a craven narcissist. When he was governor of New Mexico, look, he served two terms. He is a Republican in a Democratic state. Did a good job, vetoed lots of bills that would have favored these businesses, state legislators like to do. He said just stay out of government. Let's have it be a level playing field.
SMITH: What is the trend as far as people listening to these libertarian views?
STOSSEL: For some reason, most people don't even know who Gary Johnson is. We went -- polls have shown that. A lot -- we took his picture to the street. Most people, who, who is that guy?
SMITH: My favorite part of your show when you go out there.
TURNER: But these kinds of other parties are so healthy for the democracy as a whole. I think whether you agree what other alternative views that people put forward, the Libertarian Party, the Green Party, whatever it is, it's important that they're there. It's important they're advocating alternative positions because we tend to get very stuck into the two traditional parties, and a lot of people don't find homes there. So, this is great.
STOSSEL: I'm biased. I don't think the Green Party adds anything, it's just Bernie Sanders plus some and Hillary plus some. But, it's healthy if people are aware of them. If they can get into the debates, but the debate commission run by Republicans and Democrats, it's not some neutral group, won't let him in unless he gets 15 percent in the polls. And most of the polls puts him either last or don't mention him. So, that makes it tough.
SMITH: All right. So, by the way, what is your takeover on, I mean, Libertarian candidates included. Donald Trump, Hillary Clinton, got the emails, the race baiting, I mean, the rhetoric, definitely as we've been leading every hour this morning, John. It's heating up, and we're getting closer to November.
STOSSEL: Well, look, it's the business channel. We should trust the betting, people putting their money where their mouths are. If you go to electionbettingodds.com you could see its 76 percent Hillary, 21 percent Trump. She's almost certain to be our next president.
OTTER: I'm a data guy. I always calling out people who express opinions instead of numbers. So, I'm with you 99 percent. And the 1percent, the one reason why I don't trust these polls quite as much as others is, because Donald Trump does taps into a new electorate. And I don't -- he might not win, obviously the odds are Hillary. But it is possible that there're people not answering their phones when -- or pollsters don't even have these numbers. We could be surprised that this alleged, you know, Donald Trump.
SMITH: He keeps referring to the Brexit, right?
OTTER: Yes.
SMITH: And comparing that and using that as a parallel.
(CROSSTALK)
STOSSEL: And 20 percent isn't nothing.
OTTER: Right.
STOSSEL: The betting isn't perfect, but it's better than everything else.
OTTER: If I would bet, I'll put money on Hillary, But I do think that's the wildcard that the polls can't account for.
STOSSEL: You wouldn't put your money on Gary Johnson.
(CROSSTALK)
OTTER: The Barron's, by the way, has written a lot about Gary Johnson.
SMITH: So, by the way, when you.
OTTER: Our economics editor is a big Libertarian.
SMITH: There is a big difference when you have the head-to-head matchup Trump, Hillary, and then you added the other candidates. Who, when you add the other candidates, does it siphon more votes equal away.
(CROSSTALK)
MCDOWELL: Yeah. I think the Quinnipiac polls it seems to be almost an equal siphoning away.
STOSSEL: So you can't say it is a spoiler that's going to help one candidate or the other.
SMITH: Amazing. So, we will be watching that tonight. John Stossel, thank you.
STOSSEL: Thanks.
SMITH: Good to have you here. The Libertarian town hall airs tonight at 9:00 PM Eastern, right here on the Fox Business Network. All right. Coming up, will they or won't they? We head to Jackson Hole ahead of Fed chair, Janet Yellen's highly anticipated speech happening a little bit later this morning. This after we got the in-line reading on second quarter GDP, 1.1 percent was the number there for the second quarter. Plus, are dollar stores sending a warning sign on consumers? What that means for the health of the broader economy, next.
(COMMERCIAL BREAK)
SMITH: Discount store rivals Dollar General, and Dollar Tree reporting weaker-than-expected sales figures. Dagen McDowell has that story and other headlines. Dollar store not doing so well, huh, Dagen?
MCDOWELL: Dollar General says that same-store sales, Sandra, rose only .7 of 1 percent in the second quarter. The company saying a cut in food stamp benefits in several states kept its customers away. It speaks right to the -- how people are struggling. And Dollar Tree said same-store sales increased just 1.2 percent. This comes as struggling lower income shoppers spent less at these stores.
More than 25,000 Safety First strollers are being recalled in the United States and Canada, the reason is a fall hazard. The recall involved step- and-go travel systems sold under the Safety First brand and manufactured by Adore Juvenile. The firm said that the stroller tray folding mechanism can come apart on one side when used with an infant car seat attached to the stroller.
SMITH: Oh, scary.
MCDOWELL: There have been 30 reports of incidents, but no injuries yet have been reported. Consumers should stop using the strollers with the infant car seat and contact Safety First for a free repair kit. The stroller system were sold at Babies `R Us and other retailers nationwide. Safety First can be reached toll free. There you go. There's the phone number on the bottom of your screen, 866-762-3036.
Apple taking steps to prevent its iPhone for being hacked. The company has issued a security update to block spyware on its device. Apple is also urging users to download the latest version of its IOS operating system, that's 9.35 for security protection. It pushed it out yesterday to most phones. The problem was discovered after a prominent United Arab Emirate dissident, Ahmed Mansoor, was targeted. The flaw could let hacker's sips through contacts and photos even turn on the phone's microphone to record conversations, Sandra, back to you.
SMITH: All right, thanks, Dagen. We'll be right back.
(COMMERCIAL BREAK)
SMITH: Fed chair, Janet Yellen, set to speak at the Fed summit in Jackson Hole later this morning. Peter Barnes is in Jackson Hole, Wyoming, with Atlanta Federal Reserve president, Dennis Lockhart. Hey, Peter.
PETER BARNES, FOX BUSINESS NETWORK: Well, hey, Sandra, thanks. And Dennis Lockhart from Atlanta, thanks for joining us once again on Fox Business. Well, obviously, the big question is what's going to happen with rates? And we are going to be hearing from Janet Yellen this morning and -- what kind of comments from her might help clarify the path forward on rate hikes?
DENNIS LOCKHART, ATLANTA FEDERAL RESERVE PRESIDENT: Well, one thing to remember, I think Janet will mention that she's speaking for herself. She's not speaking for the committee. And we'll convene later in September. And I think she has the option to signal her preference or not, you know. And so, we'll have to wait and see. I haven't seen an advance copy of the speech, so I really don't know whether she feels she's seen enough to signal.
BARNES: Progress in the economy.
LOCKHART: Yeah.
BARNES: . to possibly go raise in September. You have said that you can't rule out the possibility of raising in September. You said that last week. What kind of economic data would you have to see between now and the end of September to feel comfortable discussing or voting for a rate hike then?
LOCKHART: Let me give you my sense of the economy very quickly. My sense of the economy is that the GDP number that we saw for the second quarter.
BARNES: Yeah.
LOCKHART: . really is not the total story.
BARNES: Yeah, the 1 percent, now 1.1 percent with the revision this morning.
LOCKHART: If you look within that number you see the effect of inventories. And if you exclude that, you look at real final sales, you see a more encouraging picture. A picture of a kind of steady moderate growth economy, not impressive, but nonetheless steady. If I see by the run-up to the FOMC meeting, data that are kind of consistent with that picture, my position is we ought to have a serious discussion. That doesn't mean necessarily even I am going to support it, but it deserves a serious discussion.
BARNES: As far as the labor market, the unemployment rate and inflation, what? Tracking on your outlook and making progress, enough progress to start.
LOCKHART: Tracking my outlook, tracking of on a steady, moderate pace of expansion and no surprises.
BARNES: So, we're all focused on September because it is the next meeting, but there is a meeting in November and December, as far as if you don't move in September, there does seem to be a chorus growing among your colleagues that, at least, as long as the economy is making progress sometime this year the Fed should move. And you have.
LOCKHART: I said that.
BARNES: . said at least one -- at least one move this year. Is that.
LOCKHART: Would be appropriate, you know, providing we see the continuing pace of growth and continuing progress toward our objectives.
BARNES: On the international outlook, that was something that the Fed said it was watching closely. We're now -- we're now a couple months out of Brexit. That seems to have faded. But China is still out there with some slow growth. What about international developments, you know, Europe and others, do you have any concerns about those?
LOCKHART: Well, I'm always paying attention to risk possibilities out there that could develop. Brexit was one of course, and that was very dramatic for a while, but it seems to have settled down.
BARNES: Right.
LOCKHART: In my case, I'm more focused on domestic issues at the moment. The China's slowdown continues to have some frictions in their economy that have to be worked out. Banks in Europe, particularly, Italian banks, are on the radar screen, but none of these are really dominant in my thinking at the moment. I'm really focused domestically.
BARNES: One last question, do you have any concerns about asset bubbles? You know, we're seeing the markets at record highs. The bond markets at record highs. And I asked some of your colleagues about that. Any concerns about that and potential for financial instability and overheating or anything?
LOCKHART: Always paying attention to the possibility of some kind of really turbulent period developing. Yes, the equity markets, certainly are by historic standards at high levels and high valuations. I think we have to watch it carefully, but I'm not calling it a bubble by any stretch of the imagination.
BARNES: All right. Dennis Lockhart from the Atlanta Fed.
LOCKHART: Thank you, Peter.
BARNES: . thanks for joining us this morning on Fox Business. All right, Sandra, back to you.
SMITH: All right, good stuff, Peter Barnes, thank you for that. Of course, Janet Yellen will be speaking a little bit later this morning. All right. Peter Barnes, thank you. We will be right back.
(COMMERCIAL BREAK)
SMITH: Jack Otter, thank you. Dagen McDowell, thank you. Gillian Turner, good to have you. That's it for us. Varney & Co., starts right now.
END
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