Transcripts For CNBC Squawk Box 20171130

Dow, it will be an eight straight month of gains for the dow and s p 500. Strugglest for the Technology Sector once again. Lets look at what happened overnight in asia. You will see that the nikkei ended up by close to 0. 6 points. Stocks in china under pressure the hang seng down by 1. 5 points the shanghai down by 0. 6 . In europe, in the early trading, it looks like there are green arrows across the board. Biggest gains from the major averages come out of germany where the dax is up almost by 0 0. 8, the ftse up by a quarter percentage points. Right now looking at crude oil prices opec and nonopec producers, ie russia, are expected to announce an extension of output cuts until 2018 a lot of concerns about that, whether there will be Sticking Points along the way thats why crude oil was under pressure yesterday things have picked up this morning with a gain of 1 for wti. Up 53 cents to 57. 82 well get a live report from the meeting of opec in vienna. Thats coming up at 6 30 a. M. Eastern. Among the big stories were watching, we are monitoring the price of bitcoin it continues after a volatile session yesterday. The Digital Currency crossing 9,000 on sunday, 10 tloush1su tuesday, and 11,000 yesterday before posting a drop of 18 in late trading this morning. Thats a drop of almost 2,000 thats the thing about bitcoin. Its a volatile currency i spoke with a number of people yesterday who bought into bitcoin in the past couple of weeks using coin base and some of these things. If you are based in new york, coin base may be one of the only services youre allowed to use you can trade your bitcoin i can send you my bitcoin, you can send me bitcoin, if you want to turn it into cash which is what you have to do through coin base, its not clear its so easy to do they charge a 4 or more than 4 Doctors Commission Percent Commission on your end it was supposed to be taking a margin out of things theres margin inall of it i understand why theyre charging 4 when you talk about this volatility. I would want security, too heres the question, if you are a market maker, like a coin base, at some boint do you spoiu say why are we buying bitcoin from you when everybody is selling . It will be interesting to see how this works out i had a conversation yesterday, going around it, theres a difference between a fraud and a bubble when it comes to this. Fraud is a bit of a big word, i dont know if you can call it that a bubble, my gosh. Is it a Payment System or a Money Laundering system . If its a Payment System, if you dont know if youre paying someone 11,000 or 9,000, thats not working. If youre trying to get around governments, scrutiny, then i can accept you understand the volatility and billions of dollars have either been misplaced or can you delete your bitcoin, and go, oh, and theres no getting it back it said billions of dollars have been lost or deleted people say that coin base is based in the u. S. , but there are exchanges i in sri lanka and places all over the world. It sounds like a retailers cards that you get like give me a gift card people love those but you lose them its like billions of dollars lost in that people dont use them these are the early days. Yesterday is where cramer is good yesterday or the day before, cramer said this is just this worries me, not just about bitcoin but about everything right then by the way he took a lot of flack for that saying he was getting hate email coming in because of that. Then we cross 11,000, you look again and its 9,000. Thats when it starts getting you to wonder about it who knows. I have no opinion. I dont own any, unlike some other people sitting at this desk i dont own any andrew has only 5 bucks that somebody gave me it was 5 bucks. It turned into 8 0 and probably just came down. You locked in the Charity Donation we rounded it up to 100 in corporate news, nokia shutting down reports that its in talks with juniper. Nokia said it is not currently in talks with nor preparing an offer for Juniper Networks sources earlier had told cnbc a planned deal would value juniper at 16 billion shears of juniper initially popped on the initial report. Weekly jobless claims and october perm sonal spending comn out at 8 30 a. M. Eastern, followed by chicago pmi at 9 30. And fed governor Randal Quarles and rob kaplan will be speaking today. And we will hear from kroger before the opening bell. The companys stock has been under pressure this year, especially as amazon entered the market with its acquisition of whole foods. Michael schlotman will join us at 8 10 on cnbc. At t and the Justice Department have a court date a u. S. District court judge set december 7th as the date, pearl harbor day i spoke with Randall Stephenson yesterday at the new york economic club. On this particular case, the department of justice chose to file the suit, and so we see absolutely nothing in this case that is anticompetitive, lawfully anticompetitive. As a result, looking at the facts of the case, we feel like we have a darn good case we feel like this is one worth pursuing into the courts were prepared to make concessions, if you will what we put in the filing yesterday is a concession that we would actually take away a right turner has to block out content if they cant get to contractual agreement. We have taken that off the table so we have demonstrated a willingness to make reasonable concessions to address legitimate concerns the government may have. That concession probably makes it harder for the judge to rule against at t in the suit, because he signed off of that same condition back in 2011 when comcast bought Nbc Universal Nbc Universal is the Parent Company of this network. That was a great interview. That element, you teased it out yesterday in the show, they offered a behavioral condition without having time warner already sent the contracts out. They sent them out two days ago. So anybody who wants to sign off on it, its conditional upon the deal being passed. If they do its there. Its a brilliant not negotiating maneuver but way to approach it. One thing i asked him, joe, to your point about fighting city hall, you can win and still not necessarily have clarity on some of these issues if the government chooses to appeal, appeal all the way to the supreme court. Well see. The professor is here well get to him in a second President Trump is nominating Marvin Goodfriend to the board of governors mr. Liesman has more on that story. Interesting choice. President trump tapping Carnegie Melon University president Marvin Goodfriend. He does not easily characterize as a hawk or a dove. Hes a member of the shadow market committee, a group generally criticize iing fed secrecy. Chairman paul volcker did not lay a paper he had, but it laid the ground work for todays transparent fed. He will offer Historical Perspective and good friend was critical of the decision to purchase Mortgage Backed securities, but in jackson hole he argued in favor of negative Interest Rates to combat deflation. And i quote removing zero interest bound is nothing more than the sensible application of monetary economics credibility against inflation is tied to credible against deflation. So maybe a hawk on both sides of the mandate. Goodfriend will also differ with the more rulesbased Monetary Policy change coming to the fed we have a vice chair position that is open i am told it will be a person who has expertise in Monetary Policy especially. Mohamed elerians name bandied about. And then an opening for a Community Banker a fed governors job typically held by a fed banker thats a lot of positions, a lot of change. But theyre proceeding with pace i think its going well. The president seems to be finding different people, but not people that are so radically going to upset the shift as to upset markets here thank you, steve. Pleasure. In the meantime, republicans in the Senate Voting to begin formal debate on the tax reform bill, moving one step closer to a full vote. Ylan mui has more on that. Reporter debate on the tax bill has officially begun and republicans are in a race to get this passed by the end of the week the one positive sign, senator lisa murkowski, a centrist who opposed the healthcare bill, she backs the tax plan also Vice President mike pence had dinner last night with some republicans who had been on the fence. They are working through some of the thorny issues that are still lingering out there. One of them is a possible fiscal trigger. Thats an idea from senator bob corker that would automaticall raise taxes if federal revenues fall below a certain threshold there are at least five republicans who do not like this idea they are still negotiating the specifics of that proposal passthrough businesses are another Sticking Point Senate Republicans are planning to increase the deduction they can came from 17. 4 to 20 that won over steve daines of montana. He estimated the benefit is worth at least 60 billion, but its unclear if another undecided vote, ron johnson, will be satisfied with that deal then theres a push from marco rubio and mike lee to make the tax credit fully refundable. They want to walk back the corporate rate cut from 20 to 22 in order to pay for it when i talk to republican senators, they say they want to get to yes, but theres not much time left for them to make up their minds. Back over to you ylan, thank you very much we have quarterly numbers just out from retailer sears sears losing 2. 64 per share, smaller than the 4. 46 anticipated by analysts, but Comparable Store sales were down more than 15 . Thats much more Consensus Forecast sears says the challenging retail environment continues to pressure sales the overall performance is seeing improvement that stock up about 3. 5 this mornin morning. Maif macys, kohls, nordstrm are having trouble, can you imagine being sears . No. We heard about more closings theyre doing, including the one near us. Is it impossible just to throw in the towel on that one with all the real estate for years its just been lets keep it open, but why . You can throw in the towel, but your moment for doing that was years ago. Remember arthur martinez, that was like 20 years ago they needed a savior. Then lampert the real estate was supposed to unlock it all i recently visited one you know what i was looking for . Clipon tie clipon tie you cant find them anywhere this one. Yeah, this one. My son had to wear a tie. We said you have to learn to tie a tie, which i never did with bowties. To the markets now joining us for that is james swanson, Investment Officer of mfs investment management. On set is jack caffrey, equity Portfolio Manager from Jpmorgan Private Bank would either of you like to explain the divergence yesterday . That was a huge selloff in the nasdaq, and another new high for the dow. How does that work i think what you have seen over the past, call it three, four weeks, is a number of highprofile Tech Companies managing to report good numbers. But then expectations were so high going into that number that people have actually been booking gains. Add to that the fact that value has done so poorly this year you have high Rising Energy prices with Energy Stocks having underperformed the fiscal commodity. You had some set up for rotation within some people saying i actually made 40 in technology maybe i should look at things up 10 or down 8 to put some money to work going into yearend. James, maybe the s p is a better index to use, but lets use the dow for a second were almost at the unheard of level of 24 how. That election was a little over a year ago we were still in the teens, and there were predictions that if trump got elected we would be down 5,000 points. Not only did that not happen, but were actually up, i dont know how many points, 5,000 points so, is this global synchronized growth, and as bad as he is he wasnt able to derail that move in the market . I think it is why did it go up 250 points when it didnt look like tax reform would get done . There was an uptick on Global Growth on tuesday, it wasnt the tax reform or deregulation or anything going on in this country . No, i dont think so. I think the real story is that no one thought europe could grow 2 real, or japan grow at 1 these are economies that the populations are very stable. Theyre generating strong numbers. And a lot of our big multinationals in the dow and the Big Companies in the s p are doing business in europe and japan. So thats what is the real story behind this. The world is green light for growth i think thats what is driving the market i dont think it was washington or anything do with the election the tax deal is already well known in the marketplace i dont think thats a driver. It will be for Certain Industries and sectors the real driver for the dow and what youre looking at is Global Growth the question is does that continue so if okay it just was ready to kick in a year ago then. Yeah. It was set up it just happened. Everyone thought it was due to the election in the u. S. Its not deregulation either . If tax reform goes through and adds 10 a share to the s p, thats not going to be positive either jack, do you as you put it, if tax reform goes through, thats worth 10 a year ago we had earnings about to comp positive after a year and a half of earnings declines. So i think the issues are coming back to we have Global Growth, having gone from a u. S. Centric Economic Growth environment to a Global Growth environment. We have gone from negative earnings comparisons, massive earnings revisions from lower Energy Prices to where those have gone higher i dont know i would want to attribute success to one person for the state of the global economy. You can actually have policy shifts which can accelerate some good news. But i think the issues with respect to earnings and a global picture is bigger than any one individual or any one policy change you could see weve been benefiting from positive upon positive upon positive within that whats interesting, if you are talking about a Global Growth environment, if you look within the s p, the best growth has been more secular, healthcare and technology but not the parts of the market that are most leveraged through an improving Global Environment okay. All right. Thank you jack and james thank you to you both. Coming up, Holiday Travel nightmare that can impact 15,000 flights over the holidays. Well tell you about it when squawk box returns not rebalancing your portfolio. Focused on what you love, not how your money will last through retirement. We make it easier to plan for retirement with day one target date funds from prudential. Look forward to your 401k plan. We thats why at xfinityic. Weve been working hard to simplify your experiences with us. Now with instant text and email updates youll always be up to date. You can easily add premium channels so you dont miss your favorite show. And with just a single word, find all the answers youre looking for. Because getting what you need should be simple, fast, and easy. Download the xfinity my account app or go online today. American airlines is there a bit of a sticky situation. Many of its december flights are without pilots this due to a computer glitch that allowed pilots to take Vacation Time at same time now American Airlines is offering pilots 150 of their hourly rate to work on those dates. By the way, they dont want to go back this is the union who outed this situation. 150 is the top of the contract they have. Thats the top they allowed. The union is pushing for more. Saying we all have vacation, im not coming back. I want that glitch. Call your agent right it seems to happen on other shows where everybody is off nobody left righting the ship nobody left flying the plane were important, i guess. We all need to be here should feel good about that mission critical. Would you like some autonomous planes right now . No. No im sure they have time to figure this out. Yes theyll reach something. The standoff to me seems like theyre pushing for more than 150 is the airline going to cough it up theyre talking about thousands and thousands of flights being canceled i read that, i was sort of chuckling, these poor suckers trying to fly american around christmas. I was like wait a minute, i think i have a leg of a flight around christmas on american this is serious, it needs to be dealt with this is not a funny thing. Yes, it is. It is funny theyll get it figured out theyll get it resolved if its not 100 have you seen when they need a seat exactly thats what it reminded me of. 1400 bucks. Everybody looks around there is a number. Theres a number or you get dragged off the plane. Or you get dragged off the plane. That doesnt happen anymore how much did that cost in market cap . A lot its back thouey built it back but you dont like to see that. In new york city, the annual lighting of the Rockefeller Center Christmas Tree taking place last night nbcs broadcast featured performances from the rockettes, Brett Eldredge and gwen stefani. The tree is a 75foot tall norway spruce that weighs 12 tons it is decorated with 50,000 multicolored lights, and a star. Beautiful you know what it means for us . Lots more people here good luck getting in and out of the city gridlock alert days every day. If youre doing anything in new york city get your metro card thats what you heard thats what i do. I learned the hard way i believe it. They may be faster coming up, a key decision at the opec meeting in vienna well get a live report on the extension of the output cuts after the break. Tonight is the final season of the secret lives of the super rich what are andrew and family doing this Christmas Robert frank will give us the finale. I think we want to do many more seasons of this. We will it wont always focus on the sorkins. As we head to break, heres a look at the s p 500 yesterday. [vo] when it comes to investing, looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Welcome back youre watching squawk box, live from the Nasdaq Market site in times square. Good morning u. S. Equity futures at this hour, responding again to global synchronous growth that was going to happen no matter what up another 8 3 points. That would put the dow above 24,000 and the nasdaq is green today. That was pretty ugly that was weird to watch yesterday, watching the dow at times up over 100, and the nasdaq down 100. That was weird getting bifurcated the nasdaq, if youre going to look for the place where there was the most excitement, those f. A. N. G. Stocks. Amazon theyve been responsible for some Massive Gains weve seen. If there was going to be some other parts of the market that have not moved, as far as financials, if those could be up, tech could be down, probably not that unusual on any given day. Stocks to watch, costco is not talked about as a premiere way to manage, the way its navigated, the waters over recent years, pretty good story. Samestore sales rose nearly 8 this month the Warehouse Club operator says total sales rose 13 in the first period that included prethanksgiving, black friday and Holiday Weekend sales. And you do need to, like, appreciate a vat of mayonnaise where you never will have to isnt that the stuff you get there . They do that. Its big purchases of things, but they also are good about doing treasure hunts, we thr ha where they have goodies hidden within my dad loves t there s tshgs its food open. You get the samples to go through the entire thing didnt you have an uncle that used to go to some of those hotels for im seeing a pattern here free food, my family will show up. This is the second example. My uncle traveled a lot he would show up at hotels and get the free breakfast nobody ever looks. I know. The guys that work there, theyre looking at him i wont say which uncle theyre not sure whether he was staying there, not staying there. Okay even worse when we were kids, we used to go swimming at the holiday inn. This is number three. Did you used to sneak into the second movie after the first. Weve done that before. In the multiplex. We had a lot of kids, not a lot of money growing up. Sometimes a lot of popcorn on the floor. Never did that. We did bring in our own pizza. Okay. Wow this is i still do stuff my pockets with candy i go to dwayne reid i expect it from you. Put the candy in the pockets. You pay for the when i say the pockets, you pay for the candy. There are places like where you go in, you get your own bag. Theres 30 different things. I have sampled a few oh. I know. What about a frozen yogurt place, you start eating before it goes on to the scale. Yeah. Yeah i dont do it anymore at supermarkets, you can open up bags of stuff a couple of chips. Theyre not watching that. Workday reported what do you mean no . I can see youre guilty. Reported better than expected Third Quarter results as more companies signed up for cloutbased finance and Human Resources software the company raising the fullyear sales outlook. Shares lower today because analysts say the billings and the deferred revenue you have to look at all these things. You have to be an expert or watch us well tell you what the analysts say. Box reported a wider Third Quarter loss the Cloud Storage provider says it closed fewer large deals with customers. Some contracts slipped into the Fourth Quarter box spent heavily on marketing to attract some new customers. Opec members are gathering in vienna today discussing the extension of output cuts Steve Sedgwick is on the ground with more. Thank you very much look, a couple of big investment banks and big ones based in the u. S. , goldmans and citi have been casting doubt on whether opec can get this deal through to the whole of 2018, whether there will be issues about come mrips, whether the russians will want to go with this as well so lets listen in to see what the key kingmaker of this, mr. Novak of russia, and mr. A al falea of saudi arabia had to say. Consensus is almost complete. There will be a decision we will announce it after the conference as we always said, there are 24 participants, each has an equal vote in terms of where the market is, 100 agreement that the market is on its way to full Recovery Market on the way to full recovery the idea was to get full compliance, they pretty much got that at about 102 over the last 12 months. Two, to get global inventories down theyre halfway there. They were 330 Million Barrels above the fiveyear average, they want to get that to the exact fiveyear average, theyre down to 140 Million Barrels. Three, the obvious, they wanted the price up when they started this deal a year ago to this day, they were in the low 40s were in the low 60s the market is taking this deal well that they have a ninemonths extension. We have russia joining the fray this afternoon whether they will want some specific time lime reviews remains to be seen we know the reviews will be there. They have a committee, the jmmc, joint ministerial monitoring committee, the russians are on that the saudis and a couple others they could meet in january, meet in may and june, the next opec meeting here in vienna the point being for the market, the message that comes out this afternoon. We will get reviews, but whether they become official reviews because the russians are playing to a domestic audience that remanl r remains to be seen how the market will take that. Whats clear to me, i spoke to the iranians, the iraqis, qataris, venezuelans, they want a ninemonth extension then theyll have a look at the end of the difficult first quarter, possibly midway point of 2018 and see where they are because a lot of the opec delegates think well get rid of those excess inventories by the middle of the year theres a problem, the bit they cant control is shale i spoke to various players in the last 24 hours, they are concerned about shale. The iraqis told me yesterday, they have to look at whats going on on the other side of the river that means when youre above 60 a barrel, were happy as opec producers, but we notice what its doing to shale production theyre worried about shale in key markets where they used to be, ie china the americans were not selling shale or oil two china two years ago, now theyre growing ridiculously fast. In october, 208,000 barrels a day. This month, up to a quarter Million Barrels a day, next month it could be up to 350. Were those growth rates, they are getting worried, looking over their shoulder at the shale producer im not saying there will be a fly in the ointment but lets look at the russians ill speak to them later sedgwick, do you got any money . Do you go to dinner when youre there . I do go to dinner yes. I have a favorite, i have a favorite Italian Restaurant here in vienna. You ever heard of dough and co its across from st. Stevens, the cathedral. Wienerschnitzel, go there. Its expensive, though have i got your Corporate Card thats an idea. Good idea well send you the expense code. Send me a picture of the back of the card as well, front and back ill work on your signature, thats fine. Thats great. Have fun i did think about that it is a great place. Thats a beautiful gothic, cathedral. Just suffocating stunning. Its oppression iwppressopprk around and say they built this suffocating the wrong word. I was raised catholic any way, thanks, try it out. Dough and co hopefully they hear about it and i can get comped next time im there. Maybe theyll show up tomorrow on the set. When we come back, a sneak peek of the Season Finale of secret lives of the super ri. Rich. And at t versus the department of justice. The latest developments in the lawsuit to block the merger with time warner and reaction from Randall Stephenson stay tuned, youre watching squawk box on cnbc opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Wow record time. S. At cognizant, were helping todays leading Life Sciences companies go beyond developing prescriptions to offering subscriptions with personalized, realtime advice for lifelong, healthy living. Honey . You almost done . Nope. Get ready, because were helping leading companies see it and see it throughwith digital. I am the proud father of aeness very strong little girl named adelaide who was diagnosed with infantile spasms an incurable and debilitating form of epilepsy. Its been a devastating journey that has robbed my baby girl of normal development. Thats why i have launched the my shot at epilepsy campaign and im asking you to join me. Take your shot at the hamilton pose, donate to help us find a cure, and lastly, share it on social media. This is our shot to take. Learn more at myshotatepilepsy. Org welcome back to squawk box. Tonight is the Season Finale of the super lives of the super rich. Robert frank saved the best for last what do you have cooking for us i cant imagine what you can top everything off with. This is the king of late night television, johnny carson, this is his former home in malibu he lived there for 30 years until he passed away there 2005. He bought it in 1984 for 9 million, now its on the market for 81. 5 market. Theres no strip of sand in all of california that attracts the ultra rich and super famous like malibu theres no better example than this clifftop trophy house with the power to say dues the king of late night tv, johnny carson. One of the most beloved spots is here on the tennis lovers private Championship Court an extravagant gift paid for by his bosses at the network. Were at johnnys court that nbc gave him in appreciation we are sitting on the center court bench that johnny sat on and wimbledon gave it to him as a gift. Reporter its enough to make you want to channel mr. Carson and make these owners an offer they cannot refuse malibu market now is in such high demand, a property in carbon beach, further south, sold for 85 million. A piece of land sold for 50 million. I think what youve been on air, part of nbc for 20 25. I think a golf course for you would be in the offing par three a hole or something. Maybe a hole a golf hole with grass from augusta unfortunately, in malibu, how much is that worth just enough land for a par three hole land is going for between 2 million and 4 million an acre in malibu Larry Ellison bought 1 properties in cashin beaproperty s in carbon beach, so theres not much left. The neighbors for carson are julia roberts, hopkins you forgot ron myer absolutely. This house, these views johnny walked into a party in this house in the 1980s and told the owners i want to buy this house. They said its not for sale. He wrote down a number and bought it there. It wasnt even for sale. He made an offer they couldnt refuse this was his house he commuted every day from this house to the studios how long was that back then it was 40 minutes now its a couple hours. What year was that . 84 that was a lot of money in 84 like 80 million today exactly funny how it works. Great house, we have more tonight. Thank you well watch this evening. Thank you. When we return, the u. S. Is threatening north korea with destruction if war were to break out. We were talk to former state Department Official evan revere, and right now a check of the european markets green arrowscrs aosthe board. To dig a hole to china. Eg at t is working with farmers to improve irrigation techniques. Remote moisture sensors use a Reliable Network to tell them when and where to water. So that farmers like ray can compete in big ways. China. Oh. He got there. Thats the power of and. I just finished months of chemo. But i dont want to talk about months. I want to talk about years. Treatments have gotten better, so. Im hoping for good years ahead. Thats thanks to Research Funded by the American Cancer Society. The same folks giving me free rides to treatments, insurance advice,and a place to stay during chemo. I need that stuff like you dont know. And now that you do, please give. Call 18004164357 today. Your contributions to the American Cancer Society fund valuable research but thats just the beginning. A cancer diagnosis can kick off years of challenge. And thats where your donation truly shines. You help us fund free rides to treatment. A live 24 7 help line, free lodging near treatment centers, and even efforts to expand access to insurance. So, please donate today at cancer. Org and help attack cancer from every angle. For her compassion and care. He spent decades fighting to give families a second chance. But to help others, they first had to protect themselves. I have afib. Even for a nurse, its complicated. And it puts me at higher risk of stroke. That would be devastating. I had to learn all i could to help protect myself. Once i got the facts, my doctor and i chose xarelto®. Xarelto®. To help keep me protected. Oncedaily xarelto®, a latestgeneration blood thinner. Significantly lowers the risk of stroke in people with afib not caused by a heart valve problem. It has similar effectiveness to warfarin. Xarelto® works differently. Warfarin interferes with at least 6 bloodclotting factors. Xarelto® is selective, targeting just one critical factor interacting with less of your bodys natural bloodclotting function. For afib patients wellmanaged on warfarin, there is limited information on how xarelto® compares in reducing the risk of stroke. Dont stop taking xarelto® without talking to your doctor, as this may increase risk of stroke. While taking, you may bruise more easily, or take longer for bleeding to stop. It may increase your risk of bleeding if you take certain medicines. Xarelto® can cause serious, and in rare cases, fatal bleeding. Get help right away for unexpected bleeding, unusual bruising, or tingling. If youve had spinal anesthesia, watch for back pain or any nerve or musclerelated signs or symptoms. Do not take xarelto® if you have an artificial heart valve or abnormal bleeding. Tell your doctor before all planned medical or dental procedures. And before starting xarelto®about any conditions, such as kidney, liver, or bleeding problems. Its important to learn all you can. To help protect yourself from a stroke. Talk to your doctor about xarelto®. Theres more to know™. Welcome back to squawk box. President trump promising a new round of north korean sanctions following Senior Adviser evan revere is here. Good morning. Good to be back. So the big question is you see this happen. There has been sort of a red line at least described about all this except its sort of hard to do anything about the red line what do you do i dont think weve reached the red line yet i give the north korean credit for what theyve just done with that Missile Launch. It was the most successful Missile Launch theyve had to date it theoretically can range the entire United States right. But once again the missile has never been tested in a combat trajectory. This missile wednesdnt straightp and came down straight its never been tested with a warhead. The north korean have yet to demonstrate they can bring a missile with a warhead back into the earths atmosphere and have it land where it needs to land. In a combat setting thats why they did in the the dark this time theyve done one other in the dark much more difficult and they cant collect the pieces afterward . Well, all the pieces fell in japans economic zone. If it doesnt work was that on purpose or a mistake . I think they were trying to do a head fake to demonstrate they have the capability not only to do it in Daylight Hours but in terms of where it landed. Theyve done that many times. Many times. That sounds fine but its not all that reassuring. Its not all that reassuring. A lot of people thought the 75day pause was an indication the North Koreans were perhaps not going to launch. Most experts that i know did not believe that for a minute. This was a sophisticated missile, the most capable one they ever launched and it took a lot of time to prepare the reason for the pause is not that they were getting ready for diplomacy, theyre getting ready for a launch. Weve only shot one down at night. We dont know if we can shoot them down at night, or do we we have certain capabilities as they approach United States airspace if they were directed at japan as opposed to over japan or short of japan we would have certain capabilities. You have a high degree of confidence that yes daytime, nighttime, it doesnt matter. If they were ever to launch one, theyve only got one chance to do this, dont say in. If youre talking about a launch directed at the United States or directed at one of our allies you have a high degree of confidence we could thwart if its one missile, despite the fact our Missile Defense systems are not perfect we have a good chance of hitting. It why wouldnt they do that and launch multiple things at the same time . They would probably want to launch multiple things but lets hold back here for a second. This is a country that is not bent on National Suicide this is a country that despite their eccentricities is rational they understand that an attack or a threat or preparation for an attack on the United States, our bases or our allies will lead to a response by the United States and will put north korea out of business in the most fundamental sense of the word. Whats the end game were not there yet where we are right now is theres an absolute requirement in my view to ratchet up sanctions to an unprecedented level. Thats the track were on. More and more people, though, are inclined to say that theres nowhere were going to stop this and we need to figure out a way to live with it and manage it and deal with it. If you were an investor and you saw the market dip briefly in part because of the tax reform plan looking like it was going to be real, things came back, this would be part of any of your calculus i think over the next several months it would probably be part of the calculus. But lets keep a look at whats going on in the korean market. The koreans have been on the front lines facing these threats on a daily basis you dont see people running for the exits in south korea theres a level of confidence that they have in their own military and our military and the credibility of our deterrent and our ability to manage this and control it and hopefully resolve this issue successfully. Do we get pessimistic about chinas ability toll do anything for us. Ive long been pessimistic. They just sent a highranking official over. Who got dised in a big way by the North Koreans and that was also predictable. So why dont they cut off the oil supplies china is very much conflicted on this. The biggest nightmare for china is not a nucleararmed north korea, its chaos on their border so the idea of a plying overwhelming economic sanctions and bringing about the collapse of the north korean regime, thats chinas nightmare, theyre trying to avoid that so when we ask them to sign on to an americanled program of maximum pressure, massive pressure, the chinese go, well, well help you a bit but were not going to help you undo the north korean regime because that results in our nightmare so the chinese are trying to have their cake and eat it, too, keeping the north korean regime alive, keeping it on life support, keeping america happy by doing a little bit more in terms of sanction sanctions but not so much. So were going to live in a world where Nuclear Warheads are pointed at us and we have some pointed at them. I hope we dont get to that point. How do we stop it if you take the approach the Trump Administration is taking right now to its logical conclusion, set aside the talk about war and presememption andl that, but if you ratchet up sanctions, get the International Community on board, put together a coalition of the willing to squeeze north korea in unprecedented ways we may yet be able to get them to blink and come back to the negotiating table and deal responsibly with the International Community and that would include getting rid of their nukes the chances for doing that are not as great as they were five or ten years ago they are in effect a Nuclear Power now. He really wants to be a world player and be taken seriously. We could make that country we could feed the starving. There is things you could do that would make life so much better for North Koreans those are precisely the talking points we used in the Clinton Administration and the Bush Administration and never mind then. Exactly. Weve been down this road before and were in a different place now. Right now squeezing, pressure, isolation and a bloeblly coordinated program is the way to go about this. Thank you. Great, see you. Good to be with you. Coming up, tax showdown in wmerbenng laaks giinto mall debate that could start tomorrow x yier good morning, futures higher this morning as tax news and opec talks take center stage for Global Markets the full rundown of what investors should be watching negotiation that in todays trading session that is straight ahead. Debate is now under way on the republican tax plan. A final vote could happen as early as tomorrow. Well hear from senator mike rounds on where things stand and how he will be voting. At t is not giving up without a fight. Randall stevenson sitting down with becky yesterday to discuss the dojs case his comments and what it means for more media mergers minutes away thats a lot of ms. The second hour of squawk box begins right now announcer live from the beating heart of business, new york city, this is squawk box. Good morning, everybody, welcome back to squawk box cnbc, we are live from the Nasdaq Market site in times square im becky quick along with joe kernan and Andrew Ross Sorkin. Lets check out the futures, weve been looking at green arrows once again. The dow indicated up about 77 points above fair value, nasdaq would open up by ten points, the s p 500 would open up by 7. 5, its been a strong month for the dow and the s p 500. A big networking equipment deal is apparently not happening despite reports to the contrary. Nokia issuing a statement that it is not in talks to buy Juniper Networks sources told cnbc yesterday that the two were in buyout talks that would value juniper at about 16 billion. Junipers stock, by the way, is riding a ninesession winning streak but you can see on this denial the stock is down by 6 amazon is making a push to bring its digit al assistant alexa into the workplace the idea is to let alexa book concerns rooms, set up meetings and perform other work functions. Details will be announced at the annual conversation for Amazons Web Services unit. Its a busy morning for economic numbers in 90 minutes well get october numbers for personal income and spending as well as the labor departments report on initial jobless claims. Were monitoring the price of bitcoin after a volatile session yesterday. The Digital Currency crossed 9,000 on sunday, 11,000 yesterday before posting a drop of about 18 in late trading its been volatile this morning. Ive had people on twitter writing in why are you obsessing about this no one out here has any. That could be changing if you look at the journal etfs. Who says nobody has any well, our our viewers, what percentage of our viewers to do you think own it i cant tell you about people who have said i have bought some or i want to know if i should. I think that says more about view than our viewers. Ten million accounts on coin base, so somebody has those accounts its not a lot of u. S. Ownership. Its not even in the top ten its global speculation thats the first vehicle where everyone in the world could speculate together. Well talk to you in just a second and more. And bitcoin. President trump nominating Marvin Goodfriend to serve on the Federal Reserve board of governors. The Carnegie Mellon economist has been a critic of the fed he said they should welcome more congressional oversight. He would take the seat vacated by sara blooms rekin who resigned in 2014 we want to talk markets, krishna is here and also joining us is doug cote, the chief investment strategist at voya do either of you own bitcoin separately and apart from everything no, my son insisted i buy him one, i didnt being a good investor. Mistake he remind me everyday. When did he want you to buy a year ago. How many people before we get into the markets, how many people come to you now and say do you think i should be in bitcoin . All the time. For me, no. Its an interesting item, speculation, but its not an investment vehicle. So what do you think of jim cramers thesis which i think he espoused yesterday or the day before which is that when you see a frenzy like this, forget about what it says about bitcoin unto itself but what does it say about the marketplace . Is there so much money sloshing around now that maybe it means that no, do not mix whats going on with bitcoin with whats going on in the market theyre two separate things. This is a highly speculative its going to end badly. There has to be enough cash and liquidity for people to get around in a tulip craze, correct . Theres not as much trading as the numbers would have you believe so its more about pricing going up and not a whole lot of activity taking place on the back of it so i think doug is right, this speculating or insisting that the prices of bitcoin is going up because of liquidity in the marketplace, i dont think that is the case i think what is going on is this is the first vehicle available for people to speculate on a global basis anybody in the world can participate and therefore its relatively easy to do that i think thats what were seeing more than anything else. I imagine you contend that to the extent the market has continued to rise its in large part because of tax reform no. Fundamentals, if you look at the big three pillars of the global economy, that would be europe, the u. S. , china, when europe does well, china does well, when europe and china do well, the u. S. Does well and i think the momentum is Getting Better and i dont think the market fully appreciates whats going to happen in 2018 were already seeing an accelerating corporate earnings, broadening manufacturing, consumers are an alltime record high in u. S. Health, 100 trillion i next to continue tax cuts will only be icing on the cake this is going and i believe tax cuts do get done were in a probusiness environment not only in the u. S. And around the world, definitely invest globally. Whats it going to do to the real economy what is it going to do to wages, this tax cut in your mind . So i think one of the thesis that is being articulated is that it will lead to higher raises i dont think that is going to be the case. I think the rise in Economic Activity may lead to a modest increase in wages but i think that magnitude is very, very modest because we are talking about maybe onetenth, twotenths percentage point increase in gdp based on the stimulus numbers that we are talking about. But, again, doug is right, on a what we are seeing at the moment is a globally synchronized economic the picture and easy policy and high earnings thats the driver of the market, not as much as tax reform. Tax reform is helping but thats not the primary driver. Do either of you have any bears in your office guys or women who during morning meetings saying you have it wrong, this other thing is about to happen and youre missing out. We have andrew here. Absolutely we have differing views and that creates robust conversation in our whats the most unique idea youve heard internally at your place recently about what may be off about to the extent that you have this view. Not off but what was an innovation that i heard from one of my colleagues is productivity you saw Capital Expenditures with the gdp going up to 3. 3 10. 4 in his notion is what matters more than wages is productivity is finally going up capital to labor and thats going to be an ultimate driver of inflation and Economic Growth. If youve had anyone for the last year and a half thats been an outspoken they shouldnt be at your firm anymore. Thats precisely the point. Fire them, theyre totally wrong, the market is up 30 . They mean nothing. The biggest thing about this rally is the fact that people have been extraordinarily reluctant to accept the fact that the markets could rally. The other thing thats irritating me listening to this is that the United States is responding to the rest of the world. We know the United States is the biggest economy in the world still, china has not surpassed the United States yet so everybody that is so hesitant to say the u. S. Is leading the global economy, thats like saying the teague is wagging the dog. The rest of the world is doing better but some is a direct correlation to how much better United States is doing so the rest of the world responds to how well domestically were doing and you cant distinguish between oh, it happened over there first and now its happening to us. Its all part of the were the dog. That is true. I think what changed in 2016 was the fact that because of a commodity crash, other places actually went down and went to that they came back, the u. S. Has been steady at 2 give or take so i think when people talk about its not driven by the u. S. , its overseas, they mean the synchronization of Global Growth came from things coming back. Didnt happen in a vacuum. But the catalyst was Europe Europe was the big change over the past few years that really started helping out. Yesterday European Senate indicators that a 17year high every right now europe is in a Virtuous Cycle that we havent seen in a long time and that got the that was the spark that got things going. If you think in terms of delta, change in sentiment related to what the Market Expectations were doug is right, the biggest change over the last five years really has been in europe five years ago, if you had told me that europe was going to grow at 2 i would have laughed you out of town. Everyone did now we are growing at 5 for, what, 17year highs. The turnaround in europe and people dont want to accept the fact but mario draghi probably deserves the most amount of credit for this because his policies got us there. Krishna, oppenheimer does a lot in emerging markets. Yes. If you could move your money around right now, what emerging markets interest you as a result of what youre talking about we approach emerging markets as a Company Level not geography level so we are investing in emerging markets for growth so focus on consumptiondriven emerging Market Equities more than anything else. Why do you do it as a category given that ostensibly there will be certain countries that are more attractive than others china could be more attractive but if you just invest in china youll end up with the soes and buying Steel Companies in china doesnt do you much good from a growth standpoint you want to buy alibaba and Companies Like that. So its Company Specific on a diversified basis so you dont exclusively focus in one country. I agree with that, but one thing to focus on is global trade. With the panama canal widening were seeing a disruption in trade routes and our Energy Industry down in louisiana and houston are exporting find the one good thing president obama did free market was drop the export barrier and now were seeing exports from houston, louisiana, to europe to asia through the panama canal its massive. Andrew, to answer your question, if there is one country that changed the month over the last two years in emerging markets it would have to be brazil brazil went from this is a solid recession and it may grow as fast paz 4 next year so that transition is very, very impressive thank you both, appreciate it, great to see you guys. Coming up, at t is not going away without a fight ceo Randall Stevenson firing back at the Justice Department over its planned merger with time warner. A Pretrial Hearing set for december 7 were going to talk about the implications of the lawsuit and what this case could mean for media mergers next odd date i dont know whether i would attach any significance to that, pearl harbor day and the senate moving to start debate on the republican tax bill a vote could come as early as tomorrow senator mike rounds of south dakota joins us to discuss stay tuned as you know, youre watching squawk box on cnbc and highdividend strategies. Sure, these are investments. But theyre not what people really invest in. What people really invest in, is what they hope to get out of life. But helping them get there takes a pure focus. Because when you invest their money without distraction, hidden agenda or competing interests, Something Wonderful can happen. They might just get what they wanted out of life, and maybe even more. Or a little internet machine . [ phone rings ] it makes you wonder. Shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. You get up to 5 lines of talk and text at no extra cost. So all you pay for is data. Choose by the gig or unlimited. And ask how to get a 200 prepaid card when you buy any new samsung device with Xfinity Mobile. A new kind of network designed to save you money. Click, call or visit today. Welcome back, everybody. At t firing back at the government, defending its proposed takeover of time warner. On this particular case, the department of justice chose to file the suit and so we see absolutely nothing in this case that is anticompetitive so we feel like we have a darn good case and we feel like this is one worth pursuing into the courts. Joining us to talk about deal making is craig microsooff cofounder of moffett nathanson. What kind of case does at t have against the government. Look, theyve what they will argue is that first the real competitors here are google and facebook not the traditional comcast and dish Network Second and maybe most importantly, time warners content or turners content is nice to have but not necessarily must have. You cant hold your competitors hostage by threatening to withhold that content. The really interesting thing yesterday, though, was in at ts reply comments the night before last, in at ts reply comments to in the case, they effectively volunteered and made bind ago set of behavioral remedies that would have been what you would have expected the doj to recommend. Because its the same as comcast Nbc Universal. And it really gets right to the heart of the dojs case which is that you could raise the price of content to dish network, comcast and what have you. So that have sort of neuter it had dojs case in a very preemptive way it will be interesting to see how the judge responds because it backs him into a bit of a corner hes the judge who signed off on the merger. He approved exactly those conditions in comcast so it makes him hard to say those arent good enough this time around. So what happens do you think that as a result they win win the day . It certainly helps a lot. Remember ordinarily the doj would have recommended conditions and you would have negotiated these absent that negotiated settlement, you go into court and the judge is faced with a very difficult problem which is if i approve this case there are no conditions whatsoever and then there are no limitations on what at t can do so at t by saying ill volunteer and make this binding why didnt they say this before it got to this . Did they just come up with this . Why did they my understanding is theyd been offering this all along. And why didnt the doj say well they must have some other motivation i dont know about that, i dont know that you can politicize it that much. As much as you can say what theyve said is that they dont believe in behavioral remedies when you do that, you effectively make the government a babysitter. Although dell rahim was a lobbyist for comcast Nbc Universal. And people said he should recuse himself. And over a year ago he said he thought this deal would be easier to pass than that. It didnt present vertical issues but presumably look, remember the way things happen, whether its the doj or any federal agency the work tends to get assigned to the subject Matter Experts within the staff so the same staff who organized the conditions in comcast. I red thad that the deputy antitrust guy it sounds like he may have been looking at these things its the same staff that said heres what we require in the comcast deal. It would have been odd if they said something different. From what ive read about this judge, theres a sense that for some reason he may not have been even though he approved the comcast nbc deal, he may have some misgivings about that decision oh, yeah. So the question if you were to have to relook at that deal all over again which is effectively what hes doing in this instance, yes he may be backed into a corner but he could also turn around and say you know what . I dont know if hed be prepared to say i made a mistake or whatever. Well look, i think this deal should be approved on the merits unto themselves, personal view, but if im him and i have whatever views he harbors im trying to understand what argument he would make on the other side. Well, youre right. In the comcast case it was a very unusual situation both parties came with an agreedupon settlement and it was judge leone that said i have a problem with this, i dont think its strict enough. Then he acquiesced and said i agree to what the parties have agreed to. So he signalled at the time he had problems with it. We should probably all go reread it. What were the issues he was unhappy with then . Well, some of it has to do with the ability to police all of the remember, what at t agreed to was overwhelmingly the most important condition, but comcast agreed to more than 100 different conditions and that creates there were neighboring issues in terms of channels and if two players provide a deal with an ott provider you have to agree on similar terms but what do similar terms mean it gets incredibly complicated so one of the concerns, and this was dell rahims concern as well is once you get down in the weeds of trying to administer that you effectively and police it. Police it, you effectively create this entire federal agency whose job is to monitor whether or not there is compliance with this complicated Consent Decree and who wants to be in that business and whos prepared knob that business and whos competent to be in that business and isnt that a terrible outcome and therefore a better solution is sell this or sell that and then well be done with it. Is there any asset within the time warner at t mix that you think that at t would be prepared to sell prepared to sell possibly but pea prepared prepared that would solve the problem . No. Its either directv or turner. The doj has already said that but you can understand why they would say that thats where the confluence of issues arise and so you either have to sell this really large chulk of one or a large chunk of the other. Should this put a child l on mergers and acquisitions in general when youre the talking about telecom . Sure, theres all this talk about disney and whether its fox, comcast and fox theres no way comcast is going to go after u. S. Assets at fox they might be interested in the International Assets but i said before theres no possible way comcast at a time when the doj is saying we regret having approved your nbc deal that theyll say lets open the kimono and go back in front of the doj again and ask for more so its a nonstarter you might want to start using a different phrase. Sorry about that. In todays world. Andrew, you go back and read that and you take notes and will you give it to me an becky i will deliver im going to watch netflix. Ill deliver a book report tomorrow. Would you mind . Like a cliff notes andrew notes. That could be a business. How long is that thing . You have andrew notes, its called your column craig, thank you. Thank you. When did you start writing a column en while ago wh we return, well talk drug prices. Back in a moment no matter how the markets change. At t. 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Coming up, senator mike rounds of south dakota will be on to talk tax reform. As we head to break, look at aiths sidy futureupolly agn is morning your brain is an amazing thing. But as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. Thankfully, the breakthrough in prevagen helps your brain and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. Good morning and welcome back to squawk box here on cnbc were live at the as in dpak mark Nasdaq Market spite in times square we should be getting earnings shortly from supermarket operator kroger. The Company Expected to report profit of 1. 47 per share on revenue of 7 billion. Investors will be watching closely for any ongoing impact from amazons purchase of whole foods. Facebook is eliminating its transaction fees for online charitable donations it had been challenging a 5 fee. It had been challenging a 5 fee for donations made on the facebook web site or mobile app. What . Theyre going to remove that. That seems like a good sign. Thats a massive charge. Fascinating, right . Yeah former today show host matt lauer is out with a statement. Lawer says there are no words to express my sorrow and regret for the pain i have caused others by words and actions. To those people i have hurt, i am truly sorry. He goes on to say that some of what was said about him is untrue or mischaracterized but there is enough truth to make him feel embarrassed and ashamed. The Senate Voting to open formal debate over the tax bill that could lead to a vote before the end of the week. Joining us now, senator mike rounds of south dakota for those of us senator, good to see you for those of us that were amateurs at trying to figure out and handicap these things. If you did 5248 to move it out, does that mean you have 52 or indicate you might have 52 when you vote on it, do you think well it means theyve been able to put together every single remember to agree we want to move forward with the project and everybody wants to get to yes and thats a positive step it says what leadership has done to bring everybody together but it says a lot about the fact that these republicans believe is it absolutely necessary that as a team we provide tax relief. So at this point we can probably as far as who would get it to 50 or 49, lets just say, for example, there are there is a Sticking Point. Theres a lot of people in the eight that are not now in the eight of potential problem spots. Whos still left in that eighty . Is mccain . Do we know what hes going do . I guess you never do is it flake . Because murkowski seems like senator murkowski is in. Senator snow seems like theyre in. Ron johnson. I cant imagine johnson or corker i think eventually are in unless that trigger thing comes out. Well, for both senator johnson and senator corker they have different points of view in terms of what they have expressed but both have been saying were going to get to yes and part of the message is for senator corker is were not going to leave a huge deficit for the next generation. Our goal is to eliminate the deficit and in order to do that we have to build the economy thats what this is about. Senator johnson clearly understands the differences between a c corps and an s corps, the passthroughs, he believes businesses make decisions about how they set up their entity as a c corps, an s corp, a pass through, and you have c corps and s corps, theyll look at who has the bottom line at the corporate level and thats the part hes expressed and hes done a good job of that. In doing so, other members on the committee have made some allowances, some changes to shorten or narrow that difference between an s corp and a c corp in the new tax structure. Im sure you saw the wall street journal in the lead story here and cornyn says no way that hes going to go above 20 . Thats what the president has been saying but you have lindsey graham, 22 doesnt make this a horrible bill. Its like making a cocktail. If youve got to add more of this and less of that im fine i dont know if youre a margarita drinker, senator, if you keep adding mix and not patron, its not fine. The key is to get to 50 plus one, if we can get 52 in and bring this through the finish line at 52, thats the bottom line. You think 22 you would do that and do the Child Tax Credit what would that get you if you did 22 on the corporate rate . What im saying is if thats what it takes to keep the team together, thats where well end up at. Right now the last discussions weve had have been based upon the 20 rate but we recognize that theres two parts in this first of all, theres Consumer Confidence but also a reck nation the businesses which are going to invest have got to be treated to where they have the resources to do it so i wants a trade between how much do you put into the consumer side so theres a confidence that moves forward and how much do you put back into the business side so that they number one want to do business in the United States and second of all that they have the resources to put it back into labor and into the purchase of materials and the intellectual property necessary. Its a tradeoff. Right now were pretty close to that right balance so youll hear a lot of discussion about whether or not we ought to move this by one point here or there, but youre not hearing anybody saying weve got the wrong concept. Youre hearing everybody saying can we make it better. Like making sausage, how much spice do you need . We need a little more of this or that it doesnt mean well agree we have everything we want. Its not a matter of trying to stop this, its a matter of people trying to make it better. How long has it been since youve had that in the Republican Party cocktails, sausage, we can probably come up with other ones so this will happen tomorrow and then i saw the president in missouri talking about the big pot that you put in the and you mix it up and even Better Things come out of it what do you think the final thing looks like in terms of the house when they get involved and everybody starts similar thing . Well be talking similar things probably but not that far away. I think theres a couple that i think could be sticklers part of it is i think the state and local taxes, or salt, as we call it, not that you want to put it into that kind of category but state and local tax, theres a clear understanding we want to do something to help with regard to property taxes or other taxes and i think the 10,000 deductibility we have right now is a pretty positive move. There may be a couple items the house has talked about that were not enamored with but the house started first and did a great job with the resources they had when we were able to put in the repeal of the individual mandate, that gave us in excess of 300 billion additional room to work with and putting that back in made it easier to take care of some of the challenges in rewriting a tax bill. The house didnt have that availability to them. Senator as a total aside, theres some crazy stuff happening in congress right now i dont know what happens with roy moore but hes back on top, hes up 5 again then you have conyers and franken and 20 million worth of settlements, we have no idea who else could be involved do you have insight into the thats just the tip of the iceberg. Do you have insight into how this plays itself out in these respected bodies what finally happens with regard to mr. Moore, the people of alabama are going to look this thing over and make a decision as to how they want to proceed then we have to deal with it one way or another so its going to be up to them as how they want to have this happen and i know that right now i think theres people down there struggling do you vote for mr. Moore or against mr. Moore. When that comes out in the wash then it will be put into our laps, the leadership here has made it clear that there would be if mr. Moore is elected there would be an ethics investigation and based upon that Investigation Congress would be asked to respond. On the other hand of it, up here right now i know theres been a discussion about Sexual Harassment and what the appropriate way is to proceed with all of the attention throughout the United States and remember congress is a microcosm of what goes on in the rest of the country. It came as a surprise to a lot of members i think, the fact that first of all we didnt have a normal business like process with regard to how to treat individuals who were making claims and end this second of all for a lot of us there was the surprise that this particular fund was made available for making payments for individuals and settlements for Sexual Harassment and i think that will be addressed as well theres an understanding here that you have to have a process in place that process was put in place back in the 1990s culture and the approach to these types of issues i think has changed and theres nothing wrong with going back in and i know the house and senate have good group of people working specifically on those issues and theyll be updated and i think the American Public will see were trying to respond appropriately to the changes in our culture and the way we should look at these issues. Im glad i asked you that, senator, thank you for your thoughts on that and thanks for your time on the other stuff which well be watching tomorrow well see. Then at least its interesting to watch thank you. From a distance. Yeah, from a distance when we come back, well head to the Forbes Health care summit our very own meg terrell brings us an interview with the ceo of express scripts. Then kathy mcmriors rodgers will be our next guest. Squawk box will be right back. What we do every night is like something out of a strange dream. Except that the next morning. It all makes sense. Fedex powers Global Commerce with vast, farreaching networks. Deep knowledge of industries. And, yes. Maybe a little magic. Welcome back to squawk box. Futures right now are indicated sharply higher again, up 76 points, up 10. 5 on the nasdaq, up almost seven on the s p the Forbes Health care summit kicking off in new york, thats where we find meg tirrell with a special guest good morning, meg. Good morning. Joining us is tim wentworth. You are the ceo of the biggest pharmacy benefits manager and there have been questions about the business model, about the future of your business. Do you feel the pbm model is under threat i feel pbm model has never been more needed the questions that have been raised by people who are trying to raise the cost to the system, i think we have completely answered in terms of the alignment we have with people who pay the bills and patients who need the medicines so i love where we sit in terms of the challenges the payers face and the solutions were bringing to the market. One of the biggest questions people have is amazon going to come into this industry. What is your take on what signals youve seen from them . Amazon has built a great consumer business, what people dont understand is we have a tremendous ecommerce business with almost 30 billion of mail service prescriptions being done with digital interfaces with our clients, about 85 of the time eprescribed into us so we have a tremendous business thats solving the needs for those patients amazon if they were to look at coming in as a retailer or taking care of cash patients we think could make an interesting partner for us but im not i cant comment on how interested they would be into coming into a market thats so competitive already. It seems like early stages for them in terms of Decision Making have they reached out to talk about your potential entry we talk with all kinds of folks all the time and i wont talk about any particular set of conversations. Im confident theyre looking at the market, as they should be. They look at every market theyre not in and try to evaluate things and from our perspective if they take a good hard look theyll see a competitive market i would point to the fact that what they will see is the magic isnt in lowering net prices to consumers, its getting the right drug to consumers, helping them navigate the system, all things weve built a business over 30 years to do. So you perceive them more as a potential partner than threat to your breadandbutter business very much so. In terms of consolidation in the industry, thats happening quite a bit and some deals in the works. Do you feel pressure as the only stand alone pharmacy benefits manager to partner with somebody or acquire or be acquired and have that kind of conglomerate i think the path of partnering is the path were best positioned to take advantage of we dont have stores to feed, we dont have a health plan to feed, we work with over 100 health plans we work with hundreds of direct payers so we can vertically integrate with them to help them integrate their objectives so i dont feel pressure other than to help our clients drive down their costs. In terms of acquisitions, we just executed on one were hoping to close soon that takes us into patient management and thats natural for us to do. I expect us to continue to look at those things but i like where we sit as an independent, focused all our capital going to driving down drug prices and appropriate utilization. On the drugpricing debate, since the epipen controversy, there has been a focus on the supply chain and the role of pharmacy benefits managers which which Drug Companies argue contribute to higher prices for drugs. Now theres a proposal being discussed about applying rebates on drugs directly to the drugs rather than spreading them across the system. Whats your take my take is if you go to the usc shaffer school, they said pbms are making 2 on every 100 on prescriptions so its a fallacy to say were keeping that money we pass those rebate us there the payers payers decide whether they want to pass those through to the members with lower premiums or outofpocket costs. The proposals would invoke bringing that down to the patient and thats a decision that can be made we pass those rebates through. We would argue it would drive up costs overall in Medicare Part d for those patients in terms of premiums going up because today those rebates are being used by the plans to support lower premiums does that hurt your business if that proposal goes through . Not at all. We pass them through 100 of the time and we have taken a pledge long ago to drive what our plans want us to do so we have the capability to take those rebates and put them at the point of sale for those members if thats what the law says or what a payer wants. Lots discuss, thank you for your insights. Thanks for your time, meg. A lot more coming up. In the 1 00 hour, we have another ceo, stick around for that. Thank you, meg, were looking forward to this. Coming this march, the cross roads of Health Innovation comes to cnbc. It a test healthy returns conference, a cnbc special event featuring top ceos, news makers, invests or and entrepreneurs about the business of health care mark this date down, wednesday, march 28, 2018, right here in new york city, for more information and to get tickets you can go to cnbc. Com healthy returns. Coming up, we have stocks to watch. Check out the futures right now as we head to break. We have some green, more green dow looks like its open 71 points higher, s p 500 looking six points higher. Squawk box returns after this short break. Most etfs only track a benchmark. Flexshares etfs are built around the Way Investors think. With objectives like building capital for the future, managing Portfolio Risk and liquidity and generating income. Thats real etf innovation. Flexshares. Built by investors, for investors. Before investing consider the Funds Investment objectives, risks, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Your insurance on time. Tap one little bumper, and up go your rates. What good is having insurance if you get punished for using it . News flash nobodys perfect. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch and you could save 782 on home and auto insurance. Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. Its that most wonderful time of the year its beginning to look a lot like christmas in new york city, especially right around Rockefeller Center last night, the annual lighting of the Rockefeller Center Christmas Tree taking place. Nbcs broadcasted the event featuring performances from the radio city rockettes, Brett Eldridge and gwen stefani among many others. Things are all lit up. Ready to go. Lets look at stocks to watch that are not overall market movers. Gab was downgraded to sell from neutral at citigroup following a 40 jump in the stock so its a valuation call that you can see illustrated there on that chart, unless youre in the car citi says then you shouldnt be watching. Citigroup says gap will face more difficult comparisons in 2018 especially at its old navy unit. Thats because they said old navy is doing so well, its been on fire as dana was talking about. I mix jackinthebox we dont have those here i used to go there quite a bit. California . Yes and i miss it but they earned 73 cents a share in the latest quarter but that was 16 cents short of estimates the Company Called the quarter challenging and said it was continuing to evaluate alternatives if kqdoba, its mexican chain. Costco had an 8. 4 jump in the u. S. Markets figures better than the Consensus Forecast for the warehouse retailer which is close to another high and up 2 . We talked about this earlier but you almost cant get enough of it. American airlines in a bit of a sticky situation this Holiday Season the airliner revealing 15,000 of its december flights are without pilots thanks to a computer glitch that allowed all these pilots to take vacation at the same time. Now American Airlines is offering pilots 150 of their hourly rate to work on those dates but the unions are pushing for even higher wages so 150 is the high sign of the union contract. But theyre saying this is an extreme situation. Are you going to pay 250 how many pilots did they let off . If its 19,000 flights. 15,000 flights and you have to have a copilot. In some planes you need three if youre going international. Thats a lot of pilots you have to lure back in and then the other issue is you some will time out so they cant fly. So you cant pick up every single right. Were assuming there will be a deal that is reached and that they will be able to step up. They have plenty of time to figure this out. Three weeks but its akin to who would like to voluntarily get off this flight 400, 800, 1,000 type of call. Think about this. If you had a Family Vacation that you had planned for the last year, youre going to wherever time and a half may not be all that appealing. Right right. If everybody got vacation, yeah i want to find out about that glitch. Youre going to find out about how to replicate it . When we return, well talk to House Republican conference chair Kathy Mcmorris rogers is going to join us to talk tax reform then earnings coming out from kroger, the companys ceo will talk supermarket consolidation, amazons acquisition of whole foods and the companys telast quarter well do that when squawk box returns right after this but right now, our bond is fraying. How do we get back to us . The y fills the gaps. And bridges our divides. Donate to your local y today. Because where theres a y, theres an us. That was just aight for me. Yo, checi mean,t dawg. You got the walk. You got the stance. But i wasnt really feeling it. You know what, im not buying this. You gotta come a little harder dawg. You gotta figure it out. Eh, i dont know. Shaky on the walk, carriage was off. Randy jackson judging a dog show. I dont know dawg. Surprising. Whats not surprising . How much money lisa saved by switching to geico. Wow performance of the night. Fifteen minutes could save you fifteen percent or more. Looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Merry christmas riding the rally the dow turning in 62 record closes so far this year and futures are pointing to more green today. New this morning, opec takes steps to extend production cuts. The latest from the cartels meeting in vienna coming up. Plus buckle up, bitcoin taking investors for another wild ride as the final hour of squawk box begins right now. Come on and take a free ride, come on announcer live from the most powerful city in the world, new york, this is squawk box. Good morning and welcome back to squawk box here on cnbc live from the Nasdaq Market site in times square im joe kernan along with becky quick and Andrew Ross Sorkin the futures have been up 81 on the dow, up eight on the s p, nasdaq indicated up almost 14. Treasury yields, were close to 240 on the ten year so were at the high end of the recent range, 238 actually right now. It was 239 earlier and that two year above 1. 75 right now. A couple big stories to tell you about that investors will be watching today bitcoin the top of the list. The Digital Currency dropping back below 10,000 it crossed 9,000 on sunday. It went to 11,000 yesterday but then it posted a major drop in late trading youre looking at bitcoin right now at 9,825. Big questions about the liquidity of bitcoin. Its back up to 9800. A lot of people can buy it gets more complicated to sell on coin base theres huge commissions involved and at some point you have to think about Market Makers when everybody runs for the exits, what happens . Do they pick off this stuff thats so volatile i dont know thats a real thing to think about. I know. You wonder about the market itself and how liquid it is. People get mad if you say anything. I know. I know in corporate news, nokia shooting down reports that its in talks to buy juniper. This in response to a cnbc report that nokia was preparing a bid for juniper. Nokia saying they are not in talks with nor is it preparing an offer for juner if networks related to an acquisition of that company. Thats interesting wording. Related to an acquisition of that Company Seems relatively clear but maybe theres a little wiggle room in there . Sources told cnbc a planned deal would value juniper at 16 billion. Shares of juniper initially popping more than 20 on that report sears was once a large market retailer, now it has a market cap to less than 5 million thats amazing to say a loud reporting a smallerthanexpected quarterly loss a 15. 3 drop in comparable is sales larger than the estimate of 6. 2 drop the retailer says its exploring ways to maximize the value of home services, auto centers and kenmore and die hard brands. This includes partnerships, sales and other means. That is stock is a 5 stock but its up 30 based on this news and look what has just arrived this morning that was my gasp. Bestill your heart. I was reading the news and you were looking away, i didnt know what was happening. And i gasped . What happened what have we got arbys. Arbys comes through big time this morning now also we should say they own the held hi choice. Famously owns Buffalo Wild Wings and yesterday we had cinnabon. Is this going to be an every morning rich ball . Probably the more we talk about it i dont see why not. These kind people hear my wish curly fries. In the morning. Spicy curly fries are those onion rings or curly fries . More curly fries. I dont know, this one has a lot of bacon and all sorts of stuff going on in here. Its 5 00 somewhere, thank you, mack, thank you you two feast, ill talk more about todays top market stories including opec ministers meeting in vienna where we find our Steve Sedgwick what can you tell us about now steve . Becky, thank you very much, indeed it seems that weve got half the story. Most of the story so far is about this 1. 8 Million Barrels a day. Will they extend in 2018 the extra three months, extra six months or the end of 2018 . Their best Case Scenario is the end of 2018 but there are lots of ifs and buts and i want to listen to the king maker from opec and then well dissect what he says and hope to move on a bit. Lets listen in. I think all of us wants to be nimble and on our toes there is the base case the base case in terms of supply, demand is going to require all of 2018. However we will need to consider other events that may develop. We know there are too many variables at play in terms of supply and demand that may surprise us and this group of 24 countries have been responsive and have been responsible. Theres so much in there. Its not exactly greenspan there. Basically hes saying our base case, 2018, ninemonth extension. Thats what the market thinks as well but we need to be nimble and consider other factors those other factors, shale at the top of the list. If the price keeps on going up and shale keeps onramping up production, the rig count goes up as well, they will respond. They dont like what theyre seeing in terms of the market. Global economy, geopolitics and what the speculators are doing as well. We havent talked about geopolitical and speculator premiums and if they see that on the price, theyll react in terms of being responsive and responsible, the responsible part of that is that their compliance has been really good. Long time viewers will know that opec cheating is quite legendary. You say youll pump 30 Million Barrels but you pump 32. But theyve been very good this time around. That i kept to these cuts because of a multitude of factors, some including the fact that venezuela and one or two other countries have gone down because of domestic problems others have gone up such as nigeria and libya who arent subject to a cut as well now being nimble this is where the reviews will be baked in. The truth of the matter is and this is very important when we get the big announcement and viewers watch this later on. Theres going to be reviews regardless, even if we dont get in the statement when the Russians Join us and the russians will speak this afternoon here, even if we dont get an official, there will be a review after three months, there will be a review after six months, the truth of the matter is and we know this reviews will be baked in anyway. They have a jmmc, joint ministerial monitoring committee, it will meet in january, possibly may and in june so my message is listen to the words but the deed will be that theyll go for 2018 and reviews will be there whether they officially say it or not. I hope that gives you clarity, back to you. Steve, thank you, it does meanwhile, there are a few stocks we want to talk about here well talk to the cfo of kroger in a moment. The Supermarket Chain seeing a big jump in shares, there hasnt been a lot of great things happening for this company its up almost 9 . Estimates beating on the top and bottom lines plus the full year forecast was above current consensus. It remains confident in it ability to keep growing Comp Store Sales as well. In about ten minutes from now well speak to the seicfo. Chipotle was citing uncertainty stemming from the announcement that the ceo and founder will be stepping down. It was up yesterday on that news now theres uncertainty. Michaels earnings beat the treat by a penny the arts and crafts retailer says it was pleased with the quarter despite hurricanerelated sales disrupti disruptions. It says customers are responsibilitying p inresponding positively. Now to washington news, the senate is moving closer to a vote on its tax plan joining us is representative Kathy Mcmorris rodgers she serves as the chair of the House Republican conference. Chair Mcmorris Rodgers, thank you for being here. Good to be with you, thanks. Lets talk about the Senate Clearing this latest hurdle puts them with momentum trying to get a vote as somebody sitting on the house side, what do you think about the differences between the house plan and the senate plan at this point . Im very encouraged im most encouraged as to what tax reform means for hardworking men and women across the country, for the economy im encouraged the senate is moving forward to come up with a vote even this week. That means we would be on track to get the differences between the house and the senate worked out and a bill ultimately on the president s desk by christmas which has been our goal but its very important the senate take action this week weve been told the majority leader said that we might even work on the weekend. On saturday or come back on monday to expedite a Conference Committee so we can keep this going. Lets talk about that in Conference Committee you would be looking at the differences between the two bills and right now the senate bill does have some pretty explicit differences from the house bill and the house bill was crafted very arefully to try and win as many votes as possible what do you think about some of those changes, including lets just start with the idea that salt deductions, what the senate has proposed versus what the house proposed the senate doesnt leave anything on the table there. Right i think its very important to recognize that for the most part were headed in the same direction, that we have aframework agreed upon by the house and senate and the president and that has kept us moving on the right track. There are some differences the salt deduction is one of the major topics this is the state and local Tax Deduction. Its especially impacting those high tax states. Were seeing that our members reached an agreement so that were middle income americans would benefit from a 10,000 property Tax Deduction which we thought was very important so that we could ensure that middle income americans, we want everyone to benefit from tax reform and that was an agreement we made in the house that we hope the senate will come over to the house position. Kevin brady said thats nonnegotiable so im guessing thats something that in conference if it doesnt get worked out is a big problem. That was a big priority for the house and we think that is an appropriate position to take. Clearly we have some states that have been gaming the system that they have high taxes and then theyve been given the deduction from the federal government but the property Tax Deduction is a way to really target low and middle income americans and make sure they benefit from tax relief. Another thing that has been seen as nonnegotiable from the president s position is the idea that he wants 20 . Hed like to see 15 for Corporate Taxes. He says 20 is nonnegotiable but there is an amendment that will be voted on today or tomorrow that is being offered from the senate that would raise the Corporate Tax to 22 in exchange for paying for some child care supplements in return how do you feel about that if Corporate Taxes went to 22 is that a deal breaker for you orb no i want that rate as low as possible weve had a stagnant economy, stagnant wages and getting that rate as low as possible has to be one of our to be priorities, we have the highest Corporate Tax rate in the world and you see companies that are moving overseas, moving their headquarters, moving jobs overseas rather than continuing to invest and expand in america. Thats why its so important to keep that low. Im also very excited about what we did to expand the Child Tax Credit i know that were looking at options to extend that further as you think about hardworking men and women that have children at home, that is an important piece and we need to continue to look at options to increase it further. Chairman Mcmorris Rodgers youre handicapping on this. What do you think the odds are this gets passed before christmas and signed into law . We are on track i am very hopeful. There is just a real desire by the republicans in the house and senate, clearly its a priority of President Trump he has hes long said we have to get this done by president. Were keeping our eye on the goal and i am very hopeful by the progress were making. Congresswoman, thank you for your time this morning. Good to be with you, thanks. Thank you im waiting to i see something they put in the room now. Maybe theyre not doing it. What . Some music. I thought they were going to do it are you going to do it hungry eyes i had to move that stuff away from me because weve now had several mornings of hungry eyes inhaling like 2,000, 3,000 calories at a shot. Nobody puts baby in a corner. It was obvious, they could see it in our eyes, couldnt they . Sedgwick talks for a while. Which you appreciate so you could eat. I did but then he anyway, coming up, the cfo of kroger joins us live. Shares of the grocer jumping on betterthanexpected quarterly results. Ouch stay tuned youre watching squawk box on cnbc. You ate all of that now ive got you in my sigh now ive got you in my sigh sights iddle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Everyday our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment management businesses of prudential. Welcome back to squawk box. Take a look at the futures we are in the green again. The dow looks to open 75 points higher, s p 500 seven points higher and the nasdaq looking to open about 12 points higher. Check out the shares of kroger, the grosser giving an upbeat full year forecast. Lets bring in cfo mike schlotman, hes also a member of cnbcs global council. Mike, we had you on recently with when the Company Posts and this is different than some results weve seen what went better was there things management instituted or the operating environment . Why is the stock up and what was better about this quarter . Well, its a reflection of the hard work you are a associates have been doing all year we announced our restock kroger plan in october at our annual Investor Confidence and its focused on a few key respects about redefining the Grocery Shopping experience. Our visits continue to grow throughout the quarter, sales exceeded wall street expectations our guidance for the year had been above wall street expectations so analysts were expecting less out of us than we were expecting out of ourselves and were happy we were able to deliver on our own expect stations and beat wall street estimates. Our brands had a phenomenal quarter. It continues to grow they add to the gross margin rate because even though theyre less at retail they come with better gross margin rate and those combined have led to a nice quarter for us. Were pleased with the results. The head winds have been partly the deflationary or disinflationary environment in terms of pricing not input but pricing. Did that moderate . Are those head winds still present or are they Getting Better getting more positive . There is a little bit of inflation creeping back into the business there is some inflation getting passed on in retail pricing. I would say our cost inflation is still in advance of our retail inflation so were not passing all of the Cost Increases we see but we have passed some of those on. Theyre both in positive territory so there is inflation at both cost and retail. We did continue to invest in price. We what we want to do is be there for our customer effort from how they want to shop everyday, whether its online, in the store or through our click list operation and do that at a very affordable price for our kucustomers. Mike, youve got to explain the apparel thing to me. And whose idea what kind of apparel what kind of clothes why would someone want a kroger tshirt or can you whats that whole initiative . I thought it was expensive but i see in a quarter youre doing 27 billion, 28 billion worth of sales how many bill over the next few years will you spend on this apparel line keep in mind we have a line of Department Stores in the Pacific Northwest called fred meyer. So thats where that is that will be a component of it we have a lot of what we call Marketplace Stores scattered throughout the company which have an apparel offering we have always had our own brand of apparel, this is redesigning it and making it more relevant to customers today. So youre not selling kroger tshirts or pants . We have a name in mind, i probably wont announce that today. Id like to be around until our investor call at 10 00 so ill refrain from announcing that today. Slchlotman apparel or something . We would like it to appeal to a broad away of folks so that probably wont be the name, that would be my guess. Very good all right, well, hometown its my supermarket. Ive told you in the past you put my uncle out of business thats okay, though. As i recall your dad worked for kroger at the time. He worked in the kroger building. It seemed like it was a family dispute. I told you about that prouts corner, there was a butcher shop and up in priceville. Right across from kroger because you got one across from st. Theresa. All right, thank you appreciate your time this morning and send me a kroger tshirt or schlotman tshirt. I actually if i ever make it into the studio i have a gift for you nyway. Do you really it will show up it might have to do with your favorite college. Ooh excellent thats great. Can we get some food . Yeah, im full now. When we come back this morning, at t says it is willing to fight we will hear from ceo Randall Stephenson on his plan to get a alonfor mede de ti warner. You are watching squawk box right here on cnbc well, its earnings season once again. Yeah. Lot of Tech Companies are reporting today. And, hows it looking . I dont know. Theres so many opinions out there, its hard to make sense of it all. Well, victor, do you have something for him . Check this out. Td ameritrade aggregates thousands of earnings estimates into a single data point. That way you can keep your eyes on the big picture. Huh. Feel better . Much better. Yeah, me too. Wow, you really did a number on this thing. Sorry about that. Thats alright. I got a box of em. Thousands of opinions. One estimate. The earnings tool from td ameritrade. Welcome back to squawk box everyone, at t and the Justice Department are ready for a fight. A u. S. District court judge set december 7 as the date for an initial status conference of the lawsuit too block at ts merger with time warner i spoke to Randall Stephenson yesterday at the new york economic club. We are convinced once we own time warner the ability to integrate that content differently for our customers, produce new experiences for our customers will happen much quicker so that is the premise for doing this it has absolutely nothing to do with a backwardlooking view of the world where we say how the way turner can now price their content to cable distributors is the reason were doing that it has nothing do do with this deal, thats why we made this concession right off the bat, thats irrelevant. Those concessions he was talking about are ones they made in Court Filings the day before yesterday where they went ahead and time warner sent out offers to all of its distributors that is basically the same concession that was given between Nbc Universal and comcast when they did their merger stephenson says at t is open to concessions but is ready to fight the doj to get this deal done. Coming up after the break, we have breaking Economic News we have weekly jobless claims and personal income spending the numbers and instant Market Reaction straight ahead. Stay tedun youre watching squawk box right here on cnbc gglobal bonds, and highdividend strategies. Sure, these are investments. But theyre not what people really invest in. What people really invest in, is what they hope to get out of life. But helping them get there takes a pure focus. Because when you invest their money without distraction, hidden agenda or competing interests, Something Wonderful can happen. They might just get what they want out of life, and maybe even more. We are the driven. The dedicated. The overachievers. We know our best investment is in ourselves. We dont take no for an answer. We fight for what we want. Even for the things that were once a given. Going to college. Buying a home. And not being in debt for it for the rest of our lives. But were only as strong as our community. Who inspires and pushes us to go further than we could ever go alone. Sofi. Get there sooner. I believe in a thing called love just listen to the rhythm of my heart i believe in a thing called love do you think he knows were taking a picture of him in the middle of the street good morning, everybody, welcome to squawk box on cnbc. Among the stories front and center, a major expansion is reportedly being planned at the walt disney theme park in tokyo coming to japan according to japans nikkei business daily. The local owner of the resort is planning an investment of 3 billion, thats the largest since the resort opened in 2001. In the meantime, we are seconds away, right, joe just seconds from weekly jobless claims and personal income and spending, the futures continue to be sharply higher. The ten year right around 238 or so, Rick Santelli has the numbers at the cme rick well, in terms of initial claims, take away 2,000 to a 1,000 revision last week so we go from 239 up to 240 last week, now down to 238,000. 1957, that was a good year, 1. 957 million on continuing claims that is up a bit from 1. 915 million. Personal income for the month of october expecting up 0. 3 , we received a tenth more, up 0. 4 more on the spending side, up 0. 3 as expected but the 1 that we had last month was sod ill, 9 still solid. Lets look at the deflator month over month, up 1. 6 there was a rise last month initially reported at 1. 6, same as this month, but it moved to 1. 7. On core month overmonth pce, thats up 0. 2 year over year up 1. 4, thats hotter than the original release for september but it was revised to equal 1. 4. Cutting through that, some important issues, these data points werent bad, we came within a whisker of 240. Last time we traded a 240 yield was the 14th of november if you take away the two, boons traded 40 basis points, not by a whisker, they went above it. They traded above 40 basis points it was also november 14, south korea raised rates, First Time Since 2011 all things to Pay Attention to, we still have chicago pmi left becky, back to you. Rick, i laughed last night i was reading about how the spread has widened between the short and long 60 basis points as if thats some big thing we dont need to worry, anymore, right . I dont worry when it was flattening to me central bank that is taking the leadership role in reversing years and years of policy stimulus of course is going to keep the front end tight and moving higher. The long end is moving with a lot of global rates that have been on the soft side. I dont think its the data we can argue but u. S. Data has been accelerating. So not an indication of anything going on in the economy . This is just the weirdness of the Central Banks all over the globe . Yeah, in my opinion, that is the case, but dont dismiss the notion that investors are still always nervous about a major flattening in the curve and, yes, you are right that dynamic has slowed and reversed a bit over the last several days the long ends around the globe are moving higher. Rick, thank you great to see you. Thank you. Steve leishman is here, he joins us with his take on the data what do you think . I did a search on this when the yield curve was compressing the way it is now and its Something Like its successfully predicted nine of the last five recessions so it doesnt do a very good job. Its an overactive indicator. It has to go deeply negative to really be a recession indicator, if it is at all and i agree with rick that the data is accelerating look at the data today, its pretty darn good, i guess. 0. 4 on personal income after a 0. 4 last month wages up 0. 3 , thats a good number the consumption number after that big pop in september that was hurricanerelated, that 0. 9 , to do a 0. 3 is good not off the charts, the savings rate ticking back up to 3. 2 it could have been done because of the spending related to the hurricane but also the stock market is doing pretty well is any my understanding so you could have some offsetting in terms of measured savings because your portfolio has done well, you may be allocating less towards savings, we havent talked a lot about the wealth effect but im beginning to suspect it could be a stockfuelled christmas in terms of the wealth effect and that may be helping drive certainly spending people feel wealthier so they spend more. And confidence numbers are meaningful, very much so. Thank you, steve. Sure. Cnbc disruptor uptake announcing an additional 117 million in series defunding. Joining us with more on the predict analytic companies and internet of things that care . Internet of big things. The cofounder and ceo of uptake technologies. Youve been on the program before, but explain what uptick does. I brought a prop, this is a sensor. You need a bigger prop. This little device captures data like vibration, temperatures and all kinds of Movement Information and this is installed on industry assets all over the world so think of these as nerve endings of industry uptake is the brain. Uptake takes those data from the nerve endings and offers Software Platform and data science to deliver insights to the front lines of industry globally. What do you put these things on on wind turbines, locomotives, all kinds of assets. Its like the fitbit of industrial this is it. Machines. The assets wear this and we are the ones uptick software and products to industry all over the world, making industry smarter. So youve done some business with caterpillar did have an exclusive deal with them originally. Weve realigned that partnership and bought back their equity so we are totally neutral across every brand in every industry. And youre also doing work with Berkshire Hathaways Energy Business yes, Berkshire Hathaway and were in the manufacturing space, oil and gas, mining so we are in eight industries globally and were delivering as i said insight in six continents. Were still not in antarctica but well get there some day. I saw that youre involved in a Smart City Project in rhode island. We are, buses should not break down and therefore you should not miss the meeting because you couldnt get there and our Technology Helps the Rhode Island Transit Authority understand what the condition of their buses are so they can fi them before they break so its about predictive insight and advanced maintenance and also optimization in Industries Like oil and gas and mining where every minute, every hour the assets are not productive is a lost hour and also people are not replaced, they are enhance sod were about making the people that are part of these industries superhuman. That sounds like a safety factor if you notice something is wobbling on the train or one of these super turbines you get it before it falls off. And our forward value drivers, our four sources of value delivery are productivity, reliability, cyber security, and human safety and environmental safety in a bigger sense because were talking about optimizing the condition of these assets and making sure they work appropriately. Who do you think of as your competitor im going to name one of them who has been in our news a lot, General Electric made a big thing of being the internet of things for industry. The times are interesting because i im looking at what i think is the greatest opportunity for technology to create value ever. Global Value Creation from technology through Predictive Analytics in industry is as big as ive ever seen. At the same time, ge said theyre going to focus on a handful of applications. But ibm says stuff just like it they talk about showing up to fix the elevator before you know its broken. My belief is that a entrepreneurial focus is the right one for creating technology and this is a unique time, in the last five Years Technology has changed in terms of its ability to enable a company like uptake to do our job beautifully so we are competing against these Big Companies. We are unique in terms of being a small player, 800 plus people but were talking about 800 phenomenally talented and focused people thats a winning formula. Let me ask you a question this eventually is going to be a commodity business, with apologies to the fitbit folks. Its a consumer product. The Value Proposition i have to imagine is in the data and the analysis of the data totally the Value Proposition is efficient ability to take that data from assets all over the world and the data science that delivers insight so the value is in the insight and the delivery of industryspecific industryrelevant insights to the front lines. How are you going to compete against, to the extent they get in your world, google and amazon and everybody else who is investing serious money in deep learning machine learning, ai to be able to look through and analyze this data at a level, frankly, that i think is far i do not what most people are doing right now. The same way great competitors win, execution and focus and the more we execute and focus, im serving eight industries delivering insights, you find we get better over time, it backs harder to compete and our focus doesnt sway. Let me ask you a separate question is the longterm goal of your company to be a publicly traded entity or would you be happy if jeff bezos or google or somebody called you up and said hey, lets do this . My focus is growth, is execution, the passion i have that for what were doing is off the charts ive been Building Companies for 25 years theres nothing, nothing ive ever seen like industrial insight. Can you control it in terms of your control of the company do you get to make the deciding factor this is a privately held company and our investors are focused and theyre betting on our ability to deliver. How hard was it to have the conversation with caterpillar . These guys are your early partners, gave you validation early in the game, it was great to some extent but also prevented you probably from being in other businesses as a result do you have to go back to them and say love you, thank you but i have to somehow change this dynamic . We are huge fans of caterpillar and theyre still a customer so the version 1. 30 of our relationship with caterpillar, you saw it, version 2. 0 started with a conversation between me and the current ceo 2. 30 is about independence both ways and interaction from a customers and Partner Relationship versus a deeper more structural thing so it couldnt be this is a winwin, as cliche as that sounds, they have the ability to optimize their business and we do ours but were still provider to them. Whose commercial ibm wasnt it ibm where a guy shows up and says a part is going to fail in the elevator. Hold on a second. Do you remember . Which hall sends frank out to get a part that is supposedly going to fail and it doesnt fail and theres one on earth didnt fail. That was to kick him out of the safety of the zone ibm didnt think about that before this commercial thats the cool thing about this is we not only give the recommendation but once you go out to do what we ask you to do or suggest you do we capture whether were right or wrong and get better over time. He was wrong. More often than not were right. Well, well see. Thank you. Congratulations thank you. See you soon. When we come back, cash, credit, or crypto currency were going to introduce you to landlords who are now taking rent payments in bitcoin probably seems like a better idea yesterday than today. Stick around,ish watching swaux stick around,ish watching swaux here on cnbc what we do every night is like something out of a strange dream. Except that the next morning. It all makes sense. Fedex powers Global Commerce with vast, farreaching networks. Deep knowledge of industries. And, yes. Maybe a little magic. So thats the idea. What do you think . Hate to play devils advocate but. I kind of feel like its a game changer. I wouldnt go that far. Are you there . Hes probably on mute. Yeah. Gary wont like it. Why . Because hes gary. phone ringing what . Keep going yeah. laughs voice on phone its not millennial enough. There are a lot of ways to say no. Thank you so much. Thank you so were doing it. Yes we got a yes start saying yes to your companys best ideas. Let us help with money and knowhow, so you can get business done. American express open. Welcome back to squawk box. Lets look at oil prices oh, come on. All right, were going to look at oil prices. And looking at other things, bitcoin. Is that where we are right now maybe because of the massive moves in the last 48 hours. I dont want to live in a world im going to get in trouble again. Are you calling it a fraud . Not a fraud but i dont want to live in a world where bitcoin is where after we do the future, we do the ten year, the dollar and bitcoin no, theres a reason were doing it right here. But is that possible . Anythings possible. On the currency board. No, no, no. For it to be there . The yen, the euro, the british pound and bitcoin. If it ever stabilizes, sure thats the bullish view on bitcoin would be that it becomes something we talked about literally everyday. I want to know and you havent answered me is it going to be used as currency or to avoid taxes and launder money . The latter. I think theres three things going on i think one is if it becomes stable it will be used as a currency if that happens two an investment in a speculative way and its being used three by some in this third form governments can cant print more of it they cant debase that currency. Theres labor taryn reasons. The left and right love bitcoin for difference reasons. We talked about people in the United States buying this stuff, a lot of this is International Investment by people who look at this as the first true global currency. Particularly if you live in an oppressive regime and youre worried about having something you can get out of your country. Its about trust. Its about saying i dont trust these other people but i trust this. I trust you though i dont know whos behind it. Right. Although there are cases for it being used for regular everyday consumer issues. Yes, thank you, we keep going back and forth on this as consumers get more comfortable with bitcoin, more vendors are accepting it you may soon be able to pay your rent wit diana olick is here with that. Diana . Reporter it seems like its only been a few years that you can find a rental or request repairs on a mobile app. Thats old now how about paying your rent in bitcoin . Its a new offering launched in january by manage go, a company thats been provided landlords and tenants with those Services Online and through mobile. Now bitcoin. They admit there is not a lot of demand so far but theyre expecting it any minute now. We lead in innovation so we wanted we saw that bitcoin was something thats going to happen and become a standard currency some time in the future but right now the type of clients that we have, their tenants fit the profile and we want to offer it as the new amenity beyond a fancy gym, a new couch in the building, we want to accept bitcoins. Reporter the way it works is you pay online or on the app with the bitcoin then manage go converts that to dollars through coin base which is a Digital Broker then the landlord gets the payment in dollars now bitcoin is extremely volatile so you lock in the value at the time of the payment. Again, is there a huge demand for . Well, i spoke to the ceo of bazuto and he said no one has ever asked to pay in bitcoin yet, hes not ruling it out. He says theres some buzz about it at an apartment conference. He says theyre watching it and in the end its about convenience. It could happen, guys. Crazy thank you, diana, sorkin, are the winklevosss like go zillionaires theyve gotten like 100 million maybe more how much money did they get . I thought 50 from facebook. So if you took 50 million think about this you took 50 million and put in the facebook back in 2013 and you kept you just held it straight, is it possible youd have 800 zblld in maybe. But what are the odds they did that i dont know. Although i do know somebody who piut 400,000 in it who has 14 million in it. Really . I ran into somebody last night who put 500 and hes saying he has 400,000 of it im telling you i know, i know. But in every you were right to point out that chart io the wall street journal today. The spike and how quickly that happened versus i would buy this before id buy a Lottery Ticket i have a problem with the Lottery Ticket with this, i so hold on, hold on would you then buy now, joseph no. Joe, do that again thats bitcoin, how quickly thats gone and heres the other bubbles that scribe idescribe it there. Which was the japan . The japan is the one that goes way up and then goes down and a gold one, and u. S. Housing prices that ran up into. They got three or four comparisons and then show how quickly that time frame was for bitcoin, going up much more. Maybe this time is different. Maybe it is when we come back, jim cramer, live from the New York Stock Exchange you know his views on this well talk to him again in just a moment the futures are indicated higher dow futures now indicateded e about 92 points above fair value. Stick around, squawk will be right back get you down to the New York Stock Exchange and cramer joins us now. I know you saw up to 11, down to 9. So what does that indicate, jim, when the volatility starts getting that crazy is it going to 20,000, quickly i dont know. Thats usually a topping process, because youre getting guys who are coming in and guys who have already had it, or obviously flipping it to this new level of demand, which is the grandma demand if youve been following btc on twitter and there are people who are saying, listen, i just bought my first bitcoin and im really feeling great about it. I wish these people were buying gold and cyrsilver, honestly but they want to do this and they have religion and, you know, its sacrosanct to even say what i just said, but i said it right and it wasnt sacrosanct you didnt get in trouble all the way up, which reminds me of some of you remember in the past, we had names for all o them the presstekians the wayforians. Yeah, wherever it was after it had already made a huge run, if you said anything, the people that were getting in really late were the ones hey, why i want mine. Why are you saying it now. So well see yeah, but look, obviously, this is one of those things where i dont want people to get hurt you can say, jim, how are you going to get hurt . It goes up every day and the answer is, the day it stops going up, you have this volatility, it comes down, why didnt you tell me to get out of it or its coin bases fault, or whatever look, theres some theres great profit everybody i just heard, andrew was saying, i got this, i got that i met with a guy who put a million in, he got a lot, and hes a real smart guy and took out everything but his cost. And hes a guy that im not going to mention his name, one of the smartest investors weve ever seen. He said, im willing to lose my cost, but thats all that makes sense. That would be yeah, that was not take everything but your basis. Jim, thanks, see you in a couple of minutes and talk more about that coming up on squawk. Youve heard of take your kids to work day, well tell you why amazon now wants you to take alexa to the office. 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Sources tell cnbc the company is preparing to talk about new tools that will make it easier to use that assistants device, i guess its called a voiceactivated Virtual Assistant and to use that in the workplace. Partners have developed specific apps for business customers. Alexa will be able to do a thing such as book Conference Rooms and set up meetings. Im thinking about the possibility for workplace pranksters you scare me so much, im afraid to scare it on the air now. The amazon echo, doesnt answer to that if you said, you know, turn off the lights or call the police remember, we have the play Christmas Carols but we had the co of polycome on yesterday, right. And this was the issue if everybody is going to have devices that have microphones in them, you know, will they be who controls them and will they be able to do Conference Calls these big so these sort of purposebuilt things sort of change and think about the times like weve played practical jokes on each other. You leave your computer logged on and you instant message, as if youre somebody else. Or use the twitter account twitter you could Say Something that, you know, in this day and age. Be in big trouble for it. Weve got to go make sure you join us tomorrow squawk on the stree squawk on the street starts right now. Rollercoaster good thursday morning welcome to squawk tonigsquawk e stree street. Im Carl Quintanilla with david faber and jim cramer the nasdaq tries to rally from its worst loss since midaugust. The tax bill begins 20 hours of debate in the Senate Europe is up personal income and spending were pretty solid. Todays opec meeting is supporting crude our road map begins with the last trading day of the