Transcripts For CNBC Squawk On The Street 20240713

Its ceo Michael Wirth will join us exclusively this hour tesla shares set to hit a new record at the open as the electric carmaker delivers its first china made model 3 to customers. 24 hours ago looked like the selloff might continue on monday and reaction to those middle east tensions but stocks did erase earlier losses to finish yesterday in the green. Major indices saw their third positive session we watch gold, jim, are we betting this is short in duration and limited in scope . You used to work for zilian i keep thinking about that word over and over again thats the word that define this is market. Because yesterday when we were down very bad, ugly down 200 dow points, the dow is down that much, it did look like the beginning of something big, and you know what you saw . Shorts pressing, thinking this is it, this is the big one it wasnt the big one and i almost feel like that unless something happens thats completely out of left field, if you read what iran wants to target, people want to own stocks they want to own them so badly, and they want to own them even if theyve gone up a great deal. Amazon, 1900, suddenly people talking about amazon getting interesting. I see people talking about amd, as if amd wasnt up the most in the s p. Now suddenly they like it. People raising the price target. Goldman reorganization, its important the stock went up 50 points change the way they report segments, not a reorganization of personnel im saying you could argue major or you could argue that you know what . People are willing to come in even up here even though it had a good run, one of the strongest performers in the dow. A lot to talk about i think i want to be a little cautionary, where have these people been . Where has cowan been micron is up but carl, the thirst for stocks and the moment that they went down almost reminded me of 2018, where we did great and suddenly vix blows up in the first week of february right now, unless iran does something radical and erratic, people are buying stocks you say where have people been phase one, brexit clarity, u. S. Mca, 232 expiration, all these good things are happening. Youre right. The first big week of the year china was not mentioned yesterday. It didnt. Its going to get mentioned next yeweek it was rather amazing you leave on vacation and its all china. You come back, its all iran in the meantime a lot of companies in ces saying great things with the possibility to do a lot of business with china. I can craft like my friend byron wein this morning, a bunch of positive scenarios how about if Bernie Sanders wins iowa, david, first week of february coming up now new hampshire, second week of february, right . Feb 11 are you giving me a good scenario im saying a lot of people will say sanders versus trump . And trump, hate him or like him, pretty darned good for the stock market sanders cant beat trump im crafting that. Theres another scenario that says sanders wins one and then buttigieg wins one and somebody else wins another and you go to super tuesday and youre Michael Bloomberg and you get what youre hoping for, which is 15 plus percent and you get a brokered convention and that would be positive, too now thats highly unlikely 1924, secretary mcadoo . Might happen sometime might as well be now i was talking with my nephew, who is the head writer for this show and only writer for this thou show mad money have you seen the numbers for buttigieg, the money thats coming in better start focusing on him wall street loves buttigieg. How about that huge props from tudor jones and others, its true. I think again im crafting positive, buttigieg is good for the stock market, trump good for the stock market you were saying the market was downplaying the risks. I am looking at a february kind of problem, a 2018 february in that remember like january pretty good that year and we have taur i hariffs and vix. Am i positive . Im more neutral than positive when i come in and i see microchip preannouncing. They say the business is going to be down 3. 75 to 4. 25 instead of down 3 to 7 but thats industrial thats commerce. Thats consumer. Thats aerospace, defense. Thats the economy so i keep seeing things that defy my desire to be more bearish. Certainly a little reason to be bearish on tesla today, on track to open at a new record high, Company Announces a program to build the model y suv at its shanghai giga factory delivering first three cars to the public and during that ceremony if you havent seen it by now musk expresses his joy by dancing on stage, preceding to strip off his jacket, reveal a tshirt with the cartoon of the factory and boosting teslas presence, you got to just watch this you cant cut away from this this is musk talking about the companys presence in china. Take a listen. We tend to make, continue making a significant investment and increasing the investment in china, making the model 3, and the model y, and future models also in china, and i think something that would be i think super cool would be to and so were going to do it, were going to do it, is to create a china designed Engineering Center to actually design an original car in china for world life consumption so youve had nice things to say about it maybe more positive than i ever heard you talk about he could be naked, i wouldnt give a damn, that would not be fair to be truly naked oh, i dont give a damn. This thing what are you looking at im looking at you. I catch this thing at 280 you did told me i was a has been. My wife said if you tried to drive it, raise 2 billion instantly. Im a believer ten months he built that plant yes ten months. Listen, the moment you throw a rock at a window and it goes through it and the deposits soar, come on . David, at 27 of the short, people still dont believe there are any number of musk companies, and i had the opportunity to speak to a handful of people who work not just tesla but other places and one thing they uniformly say is how hard he pushes to get things done some even saying perhaps pushing too hard, too fast, but you cant underestimate his ability to move an organization, move it quickly. Why is tesla not worth twice the value of ford and gm put together given the fact that ford is a declinie ining asset. Gms sales in china were down, sold over 3 million vehicles sales down 1. 3. The dividend seems the same and interesting to contrast gm and china, which is a very important market, they sell more autos in china than here yeah, yeah. Whats the yeah, yeah its still 3 plus million. I dont know if you watched com this morning with Brian Sullivan, maybe you get up to watch that 4 00 show, too . Infomercials but thanks. Com was marveling over the idea tesla is almost as bigas the market cap in gm and ford. Ford is wasting the asset and gm is doing autonomous. I agree with byron wein, autonomous is years out. When you do the simulations they crash too much yeah, one of byrons surprises is the idea that the dream of full autonomy gets pushed out this year, because of some maybe unnerving events. I was at nvidia and saw the brilliant jenson wong show me simulations. They have to do millions and millions of simulations and the wars in snow. The cars in black ice the cars with pedestrians doing the wrong thing. Right these are all suboptimal. Yes listen, we sat here what, three, four years ago talking about the fact we thought autonomy would be here in 2020. You loved autonomy, remember . I did you loved autonomy. I did not the company by the way no, that was ill advised. I like ev. Were going to speak to the ceo of chevron i like mike wirth, like him a lot. What happens when we all go ev what happens what happens to chevron . I dont know. Dont you think we have to ask mike wirth if not today then in coming weeks or years ev as a percent is still what, 2 , 3 , somewhere in there . A lot of growth what did chevron go up 40 on this problem with iran, 50 . Nothing, zippo. Nothing. The commodity didnt really move that much at all fiveyear i dont want to be in mikes business i think mike is terrific but thats not a business i want to be in. Apache up 4, sold to you apache killed us on the alpine high so theyre like the serial killer theyre a real serial killer investors agree with yo because they dont seem to like the sector either for years going, it was the worst perfo performer or one of them last year underperforming what does it take, no one can take them over no. Oil at 100 bucks would probably be good, that would help how is that bid being put together you know what oxy, theres a lot coming on that i think theres a lot more synergies perhaps than you anticipate, mr. Negative synergy synergy is oil at 70 yes were almost there no, the forward curve hamms worry is 75, right hamm, he told me he liked 80. Hamm harold says the same thing all the time ham, pastrami, boars head. That was irreverent i thought it was really good. Other people are using it what can i use ill watch Cartoon Network what channel is Cartoon Network . Thats warner viacom remains the most stock four times earnings. How do we get back to viacom . Because were doing a lot of growth by association. Its like jims brain and then theres this whole part right there thats just viacom nonlinear thinking is the way to go in 2020. Its true i understand that. I am one i dont know if you noticed my weight since i came back, i am on a turn back time tour are you really . I am. Planet fitness today ringing the bell im going to turn back time. You had them on last night, didnt you yeah, hes turning back time. Were going to get krcramers mad dash and talk to the chevron ceo Michael Wirth, his company is pulling employees out of iraq amid tensions in the middle east watch futures. Well get to upgrades of paypal, timo, csx square, kellogg and more were back in a moment our Retirement Plan with voya gives us confidence. So we can spend a bit today, knowing were prepared for tomorrow. Wow, do you think you overdid it maybe . Overdid what . Well planned, well invested, well protected. Voya. Be confident to and through retirement. Oh, your shes landed. Ed. And shes on her way to our house. What. I thought she was coming next weekend. I got it. Alexa. Start the coffee. Set the temperature to 72. Start roomba. We got this. Dont look. What . Dont look. Lets move. Mom. The lexus es, eagerly prepared for the unexpected. Lease the 2020 es 350 for 389 a month for 36 months. Experience amazing at your lexus dealer. Before we talk about taxsaudreys expecting. New . Twins wed be closer to the twins. Change in plans. At fidelity, a change in plans is always part of the plan. Realistic goals in 2020, paying yourself first, delaying the gratification. The dollar you save today becomes 5, 10, 20 in the future automate your investment contributions. You dont have to think about it compound interest allows your money to grow over the longterm, the gain on top of the gain one way to keep on track is invest more every year so lets get to the bond pits and check in with Rick Santelli. Reporter good morning, carl. Its an interesting day. I thought wed get more move off the drop in the trade balance, deficit, smallest in years but theres a lot of moving parts there in the market, didnt pay a lot of attention the fourday chart i picked four days because of the iranian incident occurred on thursday four sessions ago. Weve stabilized in a tight range. Tight range lets open the chart up to midoctober. Basically tenyear note yields been closing in the range of 170 to 190 granted its 20 basis points but it has been a tight range. If you look at a four day of bund you see a pattern and highest yield close is minus 24 basis points so were five basis points away. Its obviously in a tighter range, but the formations are the same some of their inflation data ticked up a bit. Nowhere near their target but of course, Christine Lagarde will have her hands full trying to raisin flation levels without doing more damage to the economy and address some of the chronic structural issues, get a little fiscal activity going. Finally when it comes to trade and trying to look at that number this morning, i cant help but think of china and how things may start to clean up a little bit and to that end, the currency market seems to agree the dollar versus the chinese currency the dollar is basically the lowest level since july which means the yuan is at the best level since july. David, jim, back to you. All right, thank you, Rick Santelli as we count you down to the opening bell, 13 minutes before trading we get to i ahma mad dah of all the stocks in the world amd is your favorite over the last three years yes you love the queen of the zone we like to say. Their two ceos, 15 blocks of each other, lisa detwiler, my wife and lisa su not surprised they make its debut on mad dash but why today . Lisa su, this is ces going on, we have unbelievable coverage onfojohn ford is there at th Electronics Show dave left intel behind, intel has had manufacturing problems think about that sentence for a second, amd left intel behind. Jerry sanders ran amd and i was friendly with the Board Members now deceased at intel and thought it was important to keep amd alive so there would be no antitrust. Now amd is getting the mojo, all the big clients. Today heresy, analysts nomura says amd is going to take share from them. From my dog. Nvidia. Of course theyre related, lisa and jen smart cousins but i dont think she can do that i had this argument three years ago, when i said i dont think you can take share from intel. In what area . Data center three years she said to me jim, i am going to trump intel. I said give me a break well now im starting to take notice now i think nvidia, the Data Center Market is big enough, that david, look at this, will you . David, this is why its important just to be in stupid index funds and not pick stocks and not try see because you see this has single stock risk have you seen those adds not as good as index fund, david, because people are stupid and we shouldnt let them pick stocks, except for amd congratulations to lisa su the road map is a tap. Italy she names all of her chips rome, you know, florence ive been trying to get her to do cooler areas. Sure. Punxatawney, capri, where i saw the captain in capri i said hello he saiding in to m nothing to me the captain is jeter hey he was like, eh. What can you do . We had his wife on with us years ago. Well, we have to go will you look at this stock . Look at that coming up, oil and geopolitical tensions, well want to hear from chevron, ceo mike wirth will join us talking about the price of the commodity. Chevron thank you when i lost my sight, my biggest fear was losing my independence. Mmm. Good. So ive spent my life developing technology to help the visually impaired. We are so good. We built a guide that uses ibm watson. To help the blind. It is already working in cities like tokyo. My dream is to help millions more people like me. The unparalleled landscape of park city, or the famed peaks of whistler, youve faced the hassle of lugging your gear through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. Whatever happens out there you have the hilton app. Will the hilton app help us pick the starters . Great question, no. But it can help you pick your room from the floor plan. Can the hilton app help us score . You know, its not that kind of thing, but you can score free wifi. Can it help us win . Hey, hey were all winners with the hilton price match guarantee, alright . Man, you guys are adorable alright, lets go lose this soccer game, come on book with the hilton app. If you find a lower rate, we match it and give you 25 off that stay. Expect better. Expect hilton. Futures in the red between iran being in focus, a host of upgrades, got some ecodata at the top of the hour and in a few moments exclusive with the ceo of chevron, Michael Wirth and the opening bell in seven minutes. Sfx [phone ringing] you still have service . Call the Insurance Company its them, calling us. Its going to be a week before they can get through on these roads shhh, sorry, i didnt catch that. I said ask how soon they can be here right now . Whats now . He says theyre surveying our property now theyre probably at the wrong house i dont see any hovering his name is hovering . Look up . By automating claims with Machine Learning and analytics, cognizant is helping Insurance Companies advance how they serve even hard to reach customers. Cool if i could turn back time youre watching cnbc squawk on the street, the opening bell in four minutes. Very busy Tuesday Morning. Jim and david were talking about gold a moment ago, doing some reorg the bank calling its four main segments Global Markets, investment banking, Asset Management and consumer and Wealth Management, changes before q4 earnings as well as its first ever investor day later this morning page one piece in the journal internally they believe shares should be trading higher and as a result expanding some disclosure some metrics. Trying to present more transparency and a lot of it makes sense in the face of it when you consider things in terms of where theyre moving certain things, lending to corporate clients, where does that really belong, derivatives related to advising, underwriting these things had been designated sort of segments that really dont exist so to speak, and so they set themselves up with segments that reflect how they run the business in the hopes of presenting more transparency theyre giving the analysts a week heads up essential toy get comfortable with it before they report earnings but carl, as you point out, important day is going to come on the 29th with their investor day, and even though the stock jim has done well there is frustration on the part of many members of the organization, who rely on that stock to a certain extent, and in the Investor Base overall so much change has been pushed on the organization by its Senior Management team, led by david solomon. Right there is an argument to be made the last few years under former ceo lloyd blankfein, the organization had become somewhat splerotic, and the question is when you push that much change and dont see a result, do you bring even more pressure from shareholders . This consumer decisiivision, i was in the Wealth Management business at goldman if you brought in anyone less than 10 million, they told me dont waste my time. David, what is it now . 10 . Its a lot lower, as they do focus to a certain extent on consumer how about how opaque they are about the card ive done a work on the card the apple card which goldman is the right. It is doing very, very well so well that one day, people behind the card think it may have to be spun out, and yet here is the tangible book, ten times earnings this is Goldman Sachs, not goldman slacks when do you believe investors step up and start to show the willingness to pay a premium again that they once did for the franchise . I think that you have to believe that these other businesses, that marques sorry, lloyd i know you like the name but i think you have to see a steady increase. No more episodic works just steady as she goes increases. Youre not getting jpmorgan growth some reporting about what they would provide and wouldnt in terms of financial targets. What i can tell you is they are going to provide enterprise level wide targets, medium term targets for returns, from a returns point of view, so what theyre anticipating, thats important. That will be on each segment they are going to give to some extent real targets for people to hold them accountable to. There is a country called malaysia, looking at 2 billion, 3 billion malaysia you got to get this malaysian thing passed that book, did you read that i read other stuff. Unflattering. [ bell ringing ] a big day for investors and jpmorgan will kick off earnings season a week from today theres the opening bell the s p 500, cnbc real Time Exchange at the big board, it is Planet Fitness celebrating the opening of its 2,000th location, at the nasdaq the resistance based high intensity low Impact Fitness method, all the goldman chatter today reminds me of ubs cutting jpm and b of a to neutral, wait for a better entry point on b of a. Jpm upside only warranted if expands materially it is a cheap stock byron wein said that has to cut again. A lot of people think thats bad for the banks. We say listen wait a second, anything that will foment more Business Activity is good. Its a nice move all the banks had a great move last year look at that multiples selling at a fraction of what a serial Company Sells at does that make sense . Doesnt make sense at all sell General Mills, buy morguen . I wasnt crazy about the General Mills quarter. They played a lot with the blue buff a winner. Credit suisse ups kelloggs kelloggs got a 3 yield, doing better than General Mills right now but then again its kind of low to high. I dont know i just dont believe the bank of america and goldman should be as low as they are. I dont think. Theyre so far behind the market financials were a great place to be last year, outperforming the s p with the big move towards the end of the year. Thats true a lot of stocks catching up to where they were. Amazon still hasnt taken out its high Texas Instruments is back off the microchip preannouncement hire alphabet, david, to break up and to be more accountable, talking about being more accountable alphabet is up 4. 5 already already, there it is have you met this guy, kurt, the data center guy, google cloud . No. Most impressive guy ive met in silicon valley. Many years they have been trying to compete with aws and microsofts azure, still a distant third i want to bet on lebron james data center. Thats what youre calling this guy not me. Thom thomas kurian. Im from philadelphia. Hes a genius. I have a lot to say and not a lot of time and i got to do enough Free Association to stun you. Huh, and my hearings going, too. Your hearing is going thats my problem for sure. Oh, my god. Its loud in here, too. Yes yes, it is welcome to your mid50s mr. Rondo, the man who rang the bell at Planet Fitness started at the front desk of a Planet Fitness thats what you can do in this country. Theres hope for me its great ill start at the front desk of a Planet Fitness 2000, Planet Fitness franchise is good when you see pier one closing stores. This is the most desirable tenant in the world because its experiential david, you dont have to be beautiful like peloton theres people who ride on peloton, theyre in unbelievable shape. They have the nicest looking people on those bikes for those ads. Planet fitness you got people who are, look like the rest of us you dont feel embarrassed to go in there no judgments. Scarlet johansson you want Free Association i had a trainer and right before the client before me was scarlet johansson. Are you kidding me i had to stop, i had to quit this is going to be great, when you take an avengers role because youll be cut, right, youll be jacked like scarlet is i like this man, hes turning back time. Its my turn back time tour for sure really quick, guys you mentioned faang, one is facebook is going to ban deep fakes although not going to remove certain content that is parody or satire and jpm ups their paid sub estimates for netflix that was unbelievable, 300 million. For 2024. Theres 7 billion people in the world. Is that the target market . Is that the t. A. M. , david, 7 billion . That is the t. A. M more or less i dont know how many of them are getting it in china. What are you sounding like the president. China. Were going to make fun of how we talk this morning is that the whole show i told you i went to my 45th High School Reunion and everybody sounded like me. He was barely from queens, hes from jamaica States Tmobile came out with numbers this morning, guys in terms of customer additions. Let me give you walt isaacs take on it from lightshed. Preannounced a million postpaid phone net ads in q4. Churn was up a bit to 1. 01 , year over year, for the First Time Since the First Quarter of 2016 the net ads weds on the higher churn, likely means phone growth additions were turned to growth for the first time in a year, maybe that has positive overt e overtures for apple. 77,000 Fourth Quarter prepaid net adds below consensus, and below last years. So you can see where not much of a response there most important of course is youre going to get closing arguments in the big trial, the state ag, against sprint and tmobile trying to force a judge to block their deal to acquire sprint youll get final arguments next week we wont get a decision probably until midfebruary, but a lot of people continue to weigh in on the likelihood that the judge will, judge moreira says no and certainly it seems to be at the least 50 50 if not a higher percentage believe he will say no instanet has a piece that was very compelling which talks about the shares should also rise on a broken deal. Theyre saying win win. What is their thoughts why it would go up on a broken deal Free Cash Flow, ebitda is stronger actually the fundamentals. Who is running tmobile . Mike seiver is the ceo of tmobile i havent really gotten to know him well i look forward to getting to know him john ledger is there until the spring john ledger is going to be in my cohost on mad money. When . Hes going to take over when i take fridays off, kind of like when carson took them off. Joan rivers. Joan rivers john ledger will be the cohost of mad money. Ive talked to him, oh my gosh, how angry johnny was oh my god. The opportunity arises wed love to have him as a contributor to the network, which would be great sitting right there. I have asked him, i want him. I think hes one of the most colorful figures and built a great company. Will you let him hit the sound board, something neither david nor i do he can do whatever, like elon is allowed to be naked, can he hit any button, okay wow, thats big hes so great beyond meat up 2 on this impossible news they are going to start a plantbased sausage patty in some burger kings other restaurant news, starbucks, jim, 1300 cafes, going to lunch the oat milk honey latte, so menu innovation continues to be a piece of the story. Kevin johnson continues to do a good job the stock is a good example of the stock thats down ten from its high thats kind of the opportunities that im seeing. Many stocks are down dramatically from their highs and people are going for those and i think that does matter i think that theres opportunity in starbucks i think theres opportunity in nike i think nike can go higher Kevin Johnson comes in, a technologist, replaces howard schultz. Mark parker goes out, right, john donahoe, personal consumerization. Who would know more . Donahoe knows his way around that stuff, and service is an important part of what they have done or what they did, what he did there. I like that although he wasnt in the job, how many years was he at Service Couple years some people say not long enough you hear that . Some people. Some people well, ill tell you, i cant wait to see what mcdermott does in service now mcdermott is big think hes big think you ever go to any of his events i dont know that i have. Thats where i saw billy joel, wanted a selfie with me . How do you like that yes, because youve told us many times. Yes, many times billy joel selfie, that was your highlight of 2019. Pretty much so. He takes that chopper in from the hamptons, does that show someone gave me tickets for christmas for the show my stepdaughter. Unbelievable cant wait i gotta go. I gotta go see him how about that there you go. Were in agreement. Were making people a lot of money. We are. Youre doing great Goldman Sachs up 2. 57. Goldman is having a nice move today. On davids news i dont think thats minus. Its their news. Did you see the fire upgrade . They are citing tensions around iran as we await some response its been a laggard not a Christine Lagarde and i dont, im not sure i want it. Crowdstrike has a division that competes with fire crowdstrike is so good people are underestimating the power of crowdstrike theres another one, the stock is down gigantically as is zoom video. These were ipos last year yes im excited about a lot of stocks but i keep thinking ive got one eye on twitter president. Is the u. S. Government uses crowdstrike to secure various systems or the electrical grid using crowdstrike to ward off what will conceivably iran incursions into other countries . Yes the russians can basically turn off the power grid any time they want. Thats scary, david dont scare people like that i think its true dont scare people like that . Why because you shouldnt okay. Highlighting potential risks, which is sort of what we do here yeah, thats true maybe if you learn about it, then you can stop it you want an opportunity yes next week is the jpmorgan Conference Health care pharmaceuticals. Are you going out there am i going to miss that i know. Ill be there breaking news left and right everybody goes there, not me. You cant get a hotel room but you could stay at my place very nice you of you. Ill do the usual 3 00 a. M. And great pieces on founders ousted and raise money again great piece, so good. People, shes so good oil prices pulling back, obviously dow is down almost 100, for a closer look at the sector and how companies are starting to respond to this heightened geopolitical risk, Brian Sullivan is live at the Goldman Energy conference with the chairman and ceo of chevron. Hi, brian. Carl, good morning. Joined by Michael Wirth of chevron. Thank you for taking some time pleasure. You have American Contractors in iraq, they have removed from that country after the air strike do you anticipate they will go back and how much, if at all, have your operations in iraq been impacted . Well, we dont have a big operation in iraq. Were up north in the kurdish region, and we take security measures on an ongoing basis as we see risks evolve around the world, so this is a relatively normal move for us to move some people to do their work from a different location we have good people on the ground still in iraq, iraqis and at some point as the situation clarifies itself and we view the security position as proper, well see people return. But youre still operating, Still Producing in iraq, just the americans have pulled out . Yes, were actually developing a discovery so its not in production yet so its Early Phase Development work are you surprised the price of oil did not jump more than it did . Not really. You know, we saw the attack last year on Critical Infrastructure in saudi arabia, and pretty quickly the market reverted to areas of price range where it had been before. We continue to be in a pretty well supplied market and this event while certainly is newsworthy didnt fundamentally Strike Energyinfrastructure or change the supply and demand dynamics in the market so i think certainly a reminder of the risk that exists in our business but fundamentally hasnt shifted supply and command which is where price gets set up. Are you adjusting your internal estimates on the price of brent or wti crude Going Forward, based on not only what happened on friday, but on the opec move and the recent firming up of the market, a little bit, over the last couple of weeks . Have you changed your estimates . No, we havent. Those are the kinds of things we see in this business, and we look at a longterm view really on supply and demand, and we dont overlay the shorter term phenomena into our thinking about price and the things that drive investment i know we have jim and david and carl back at the New York Stock Exchange jim, why dont you come on in here sure, mike. Youre really probably the great visionary of the large oils, and i know you must be thinking about the day when you do have no growth, perhaps its because of reduction and demand for fuel, perhaps because of ev, and i know its not that close but youre a forward thinker what does chevron do when big oil has no growth . Well, look, the world consumes 100 Million Barrels of oil today. Weve got 6. 5 billion people on the planet, 20 years from now there will be 9 billion people on the planet. And so even and the world will need 30 more energy 20 years from now than it does today and that includes all forms, wind, solar, oil, gas, everything. And if you see a day when we see demand begin to plateau, theres still underlying decline its a depletion business, as you develop the resource you need to invest to replace that and youve got to have a price signal that incensed the replacement. There is a long future in a growth environment, and theres a long future even in an environment that begins to plateau for good Economic Investment to continue to provide the affordable, reliable and ever cleaner energy that the world will need. Are you surprised at all that the forward curve has not really budged despite the turmoil in the middle east . Not really, jim you know, fundamentally, supply and demand remain where they were before these incidents. We havent seen anything that has actually changed that last year we did see something that impacted supply for a period of time, which was at tack on infrastructure in saudi arabia, credit to aramco for a strong recovery and repair of that, but fundamentally, markets while they see the geopolitical risk, i think weve been in a wellsupplied market for some period of time here and its generally what the view continues to be at this point. If oil prices, mike, stayed where they are, i mean thats a big if, 63 bucks they were at 55, so theyre up 7 or 8 every dollar of incremental gain in the price of oil as i understand it benefits you to the tune of 450 million a year in additional cash flow. Is that correct . Thats roughly correct, yes 1 increment, 450 so you are sitting on a lot more Free Cash Flow if Oil Prices Stay this way for a significant period of time your Capital Spending budget hasnt budged, its been the same for three years would you look to increase it next fiscal year if Oil Prices Stay at 63 on wti . Probably not. Its a longterm business. We sent our Capital Spending plans for a longterm Value Proposition for our shareholders, our dividend is the most important thing to the people that own our stock. Weve increased our annual dividend payout for 32 consecutive years. Our board will make a decision on that here later this month, in terms of 2020 but i would expect that streak to continue i know david is going to jump in with a question as well what happens to the extra cash flow it can strengthen the Balance Sheet. Were buying back shares at the rate of 5 billion a year we have a disciplined financial set of priorities and well stay consistent with those priorities david thanks, brian mr. Wirth, last year, esg investing i think came into its own in a way that perhaps it hadnt up until then but its not going anywhere now more and more assets going into these broader esg strategies, which often dont include a company like yours what are you doing to try to phase down the impediments that investors may face in terms of investing in a chevron i know for example that in australia, you started up a co2 injection project in early august great country to do it in, given the fires right now, that are taking place there, perhaps as a result of in part climate change, but just address for me what chevron can do when faced with so many investors who simply say thats no go territory that stock i am at the Goldman Sachs conference today, meeting with investors, and we talk about esg issues they care about the s and the g, where i could woo hold our company up against any e is the one really you are asking about and within e, its climate. Its not water or air quality that is getting a lot of attention today. Three primary approaches that were taking on climate. Number one is to reduce the Carbon Intensity of our operations, and so weve got a strong commitment in place, and metrics that affect my pay and the pay of every employee in the company that hold us accountability to rereduce the Carbon Footprint of our operations second strategy integrate renewables to our business, solar and wind to power some of our operations ive talked to jim about some of our things on renewable natural gas, working with Dairy Farmers to take the byproducts of dairy farming and captured natural gas for consumption, and the third is to invest in breakthrough technologies, which is really where companies that have the scale and the Technical Capability should be focused how do we find solutions that can work at scale, that can be competitive and economic, with the alternatives today, and there is work to be done there so were focused on all three of those, as we have discussions with serious investors that want to see our company and those in our industry be part of the solution i think they understand the things that were working on quickly, are you going to stay in california, your Corporate Headquarters is in san ramon, across the bay from san francisco. Weve been in california i know, 140 years for 140 years. Its the birthplace of our company. We were the Standard Oil Company of california. Look, weve got big assets in california, bi california, big refinery, big oilfield there we have people in texas, all around the world its been our home for 140 years and that hasnt changed. Okay. Michael wirth, ceo of chevron, thank you for joining us guys, ill send it back to you at the New York Stock Exchange carl. Brian sullivan. Still to come, possible foods, not just focusing on burgers, the company launching plantbased pork and sausage products stay tuned for an interview as the dow is down 120. Over the last six months or so s p up 8 tesla up roughly 100 in a new alltime high today as musk celebrates the first deliveries out of cha. In dow down 121 this morning. Were back in a minute now you can, with shipsticks. Com no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. Sending your own clubs ahead with shipsticks. Com makes it fast easy to get to your golf destination. With just a few clicks or a phone call, well pick up and deliver your clubs ontime, guaranteed, for as low as 39. 99. Shipsticks. Com saves you time and money. Make it simple. Make it ship sticks. Shipsticks. Com saves you some things are too important to do yourself. Get customized security with 24 7 monitoring from xfinity home. Awarded the best professionally installed system by cnet. Simple. Easy. Awesome. Call, click or visit a store today. Jim, whats on mad. Harmon, one of the most amazing in the world built by samsung. I will show you the future he is the future what a man. Looking forward to it. Dinesh paliwal. Dont forget turn back time tour thats what im going to shoot for. See you at 6 00 when we come back, ceo of impossibleoo fds, launching sausage. Burger king is on board. Dow is down 104. So we can s, knowing were prepared for the future. Surprise we renovated the guest room, so you can live with us. Oooh, well. Im good at my condo. Oh. I love her condo. Nana throws the best parties. Well planned, well invested, well protected. Voya. Be confident to and through retirement. Good Tuesday Morning welcome back to squawk on the street. Im Carl Quintanilla key data, to Rick Santelli. An important day. Nonmanufacturing for december. Of course the Service Sector biggest u. S. Economy 59, follows 53. 9, best numbers since august when we were 56. 4. Lets go to factory orders this is a november number. Factory orders down. 7 big miss there, down. 7. Strip out transportation, though, and you can see that that made the difference it pops up to. 3 look at durable goods orders on the headline minus 2. 1. Thats not good. Minus 2. 1 is the weakest number since may when we were minus 2. 3. If we look at some of the internals here, lets take out transportation, it becomes less negative but still negative on factory orders down. 1 without transportation lets get to the money ball, shall we, capital goods orders nondefense exaircraft profit for Capital Spending up. 2 up. 2. And last month up. 1, prior to that up 1. 1. At least were putting positive numbers together, albeit small if we look at shipments, thats down. 3. Nothing to get too excited about. But nonmanufacturing solid number ism as we whoever at 181, which has been the recent high yield over the last session and a half morgan, back to you. Rick santelli, thank you. Our roadmap begins with rising risks to stocks, the latest in the middle east and what it means for markets. Thats coming up next. Plus a vegan in vegas. Ceo of impossible foods will join us in a few moments. Finally something to dance about, at least if youre a tesla shareholder. Why . The stock is at an alltime high where does it go from here well debate this hour. Begin with rising middle east tensions. Pentagon saying u. S. Has no plans to target iranian cultural sites after iran vowed retaliation for the killing of its top general. Iran says 50 killed and 200 injured in a stampede that broke out during a funeral procession for the general. Secretary of state pompeo delivering remarks now well monitor that and bring you headlines. Meantime Steve Liesman looking at how economists and strategists are digesting this news good morning, steve. Good morning, carl. The analysts breakette down, impact, best case and worst Case Scenario three specific areas lets gothrough them the first they look at is the confidence channel, both consumer and businesses. Oil and whether higher prices are as negative as they once used to be final lip gauging the possibility of military attacks, minor to possibly major attacks. Pantheon, we cant rule out a sort of grand scale attack but our core bet, the risk cinema something trigger a real war, however, will likely put a premium on oil prices for the next few months at least with the u. S. A major producer an oil spike has a different impact and perhaps it once did take a look here in october, the latest available data oil imports equaled exports. Whats paid in higher prices is also received in the u. S its going to hurt consumer in oil using regions in the country but helps producers in the Oil Production two puts helped underpin the economy and mark it says when it comes to the tension in iran a power put fed will focus on growth effects, not inflation. A trump put. The president will keep tensions at some level, reasonably low to buoy the stock market and economy. Some people have their doubts about that wars and recession take a toll on confidence. Obviously not discounting the personal toll thats taken the conflict with iran could delay expected rebound in Business Confidence from decline in trade tensions and Consumer Confidence and equity values have potential to undermine growth carl, when have you a conversation like this, obviously you dont mean to discount the human toll that happens but this is the way they are trying to analyze the potential economic impact. Our job is to cover both. Thank you, steve Steve Liesman. Lets turn to the Market Impact steve mentions morris is with us managing parter at geo plAsset Management good to see you. Good to see you. The last couple of days, change your view on investing equities. Not on a longterm basis but you have to be concerned about any political event you cant predict. Thats beyond my pay grade so were concerned, of course. How were you feeling about markets in the new year prior to these events with a measured degree of optimism which we still have but this is an Election Year i dont predict elections, especially the one as contentious as the one coming up theres a huge difference in the policy paradigm of the two candidates, whatever it will be. Best case, worse case in that political framework . In terms of the direction the democrats go and or the drx republicans go, i think what youre most concerned about are policies that will kill the economy with good intentions i think the epitome of that would be the program espoused by senator warren not so much the wealth tax but Capital Gains tax increase, income tax increase, indiscriminate attitude for people making money and work and make money. Is that going to keep you from buying stocks especially if someone like warren wins iowa . All it does is introduces element of unpredict ability i have a lot of confidence in our system we generate more innovation in this country than any other country in the world maybe israel per capita is better thats why people want to steal our i. T. Because we create it. I think theres so many areas of opportunity, so many areas of change that we want to take advantage of it. Serum when you talk about innovation, look no further than your portfolio to see it being put to work. Im curious what you think about tesla . Looks like you added to that position, went long last quarter . We pretty much had a hedge position in tesla for a long time and it was costing us some money. We basically unhedged it and added to the position when two things happened. Number one, when they raised equity this year, that bought a lot of time for the company. Number two, when they reported Third Quarter earnings, that showed they actually could make money, they could produce cars, and that they were really running a business then when you look at it in a broader context, they are at least two to three years ahead at least two to three years ahead of any potential meaningful competition in the electronic vehicle area. Im not denigrating german carmakers that produce quality products two to three years in a world of rapid change is a lot, and they dont appear to be standing still. Is it something that we just buy and put away no, not yet. Were watching the operating performance very carefully last months production numbers were encouraging the fact they were able to build a factory in china is a plus well take it one step at a time. Morris, if memory serves, facebook was another one of your favorites, at least in the past. Im curious as to your thoughts, particularly given again your point its an Election Year. Facebook is certainly going to be under the microscope, making changes as recently as today in terms of deep fakes. How much do you worry about regulatory versus the ability of them to run their business with such incredible margins. I think you defined it there. I worry. Im paid to worry. Since we have our capital invested with our partners, we worry. But its a great business. It does appear, and im not trying to sound facetious like Mark Zuckerberg is finally growing up, that hes learned he cant just do things he wants. He is running a Media Business with a very Strong Technology base, and its just a great series of businesses i just look at the way people use instagram, the opportunities that it has. Its not so much the Digital Payment initiative, its the fact that the company can become an important source of Digital Payments in a broader sense in the same way that alibaba and tencent do in china. I think they get it. Theres tremendous opportunity, a growing audience, growing usage. People want the product, and its free. Im not being facetious. Just the way broadcast television is free we pay for it through advertising. We pay for facebook the same way. Doesnt sound like youre worried about either Regulatory Risk or that in some way consumers are repulsed by the way their data is being used. Okay. Lets take the second one first. As a practical matter, i talk to people, i talk to people in my family, i talk to people just day to day, and Everybody Knows that nothing is private anymore. Okay people use that carefully. So i think of course you want your privacy protected i think that standards have to be and will be enacted i think gdpr in europe is a good example of the direction that well go but within that context, these services are very useful with regard to regulatory action, you always worry about what actions can be taken, but i think that as Media Businesses they have the right to free speech okay they have the responsibility not only the right, the responsibility to communicate everybodys views effectively. So i think that is a measure of protection all these companies, this is not just facebook, but the major companies, also have one other thing going for them they are National Assets they are innovators. They are idea generators and more than just service generators so ultimately barring a real extremist that whatever Regulatory Framework is developed will not inhibit the ability to be economically productive. Ive got to get your thoughts, ten years ago i was reading an interview where you were talking about advent of internet tv. Youve come on cnbc and talked about names like disney. As we see more streaming services launch, what do you think the next chapter looks like i think there will be tons of it streaming is the future. The only impediment to faster adoption of streaming is nfl, because broadcast television essentially has the right locally to produce nfl programs, and thats the only thing where ratings are going up but i think the direction is clear. I think that you can have two general comments anybody today can stream just about anything and that opportunity will grow, but everybody cant consume everything had the chairman of Weight Watchers on cnbc and she made that comment with regard to food you can eat anything you want but you cant eat everything you want thats in regards to streaming as you look at it, im reminded of one other line, content is king thats what we have to watch were very from an investment point of view positive on disneys strategy. We think maldorian has given a big kick up with disney plus, no baby we like the direction they are going. They have the Balance Sheet to do it and they have the management with the attitude to do exactly what amazon did when netflix came into operation. Amazon killed their dvd business because they knew that the future was, you know, streaming. I like what disney is doing. Even though its not yoda, apparently well have to find out who he is hes a member of the tribe. I havent gotten that far in the series you broke my heart a little bit. Thats what he says anyway. Good to see you. Morris mark. Coming up right here, impossible foods is making some headlines from ces the ceo is going to join us in just a few minutes speaking of the consumer Electronics Show jon fortt is there, live on the ground in las vegas all day. Jon, what is coming up after the break . David, how about some impossible devices amazon Senior Vice President devices and services is going to join me here its a really important space he covers for ces, alexa and lots of things, fire edition tv, alexa in cars. That and more coming up after the break. Achelors degree. Achelors degree. [woman] it doesnt matter how old you are, you can do it, you can finish. [spokesman] finish your degree at snhu. Edu beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Welcome back the amazon exec in charge of echo, kindle, fire, joining jon fortt at ces in vegas. Jon. Morgan, thanks. Dave, welcome. Thanks, jon. This is more and more becoming your show not just amazon but youre one of the Major Players here. Tell me how you see the interface changing around voice, because thats where a lot of your focus is. We see voice as a new paradigm of user face. We like to call it ambien interface. Doesnt replace the phone we know and love but gives customers a different way to interact around them we started with the home, being able to turn on your lights with voice is magical, to play music is magical now were extending that on the go in the car. Auto partners. What are people going to be doing in the car youre driving it. I guess theres some music stuff, navigation. Whats your vision there the big thing in your car, at least until we get to full automation, autonomy, is to make sure youre not looking down at your phone thats unsafe. Voice is perfect user interface with that. The ability to play music, listen to an audio book in your commute or information as youre going throughout your day. Very helpful. Have we gotten to the point we can admit automation is a ways off for a couple of years people talking about, its around the corner its a long corner the more realistic companies are talking about the technologies were going to use in the next year or two and stuff like this. I think thats probably right. When we get to level five autonomy sometime in the future, its going to happen but a little ways out. What you want to do is add more things that give customers convenience in the car in the front seat thats going to be voicebased interfaces, navigation in the year seat we announced fire tv, we would put it in bmw and chrysler, to get access to streaming media as cars get increasingly connected. Fire tv edition is a platform you make available to others so they can build software and services into their own devices whether sound bars, tvs. Youre kind of competing with roku tv there, right its an operating system and a platform on top of that for applications it goes into all sorts of devices. I mentioned cars, best buy, toshiba, most recently tcl with sound bar. Looks like an inflection year based on the way weve laid it out. In 50 devices but you plan 150 thats a big ramp. Not only that but ramped internationally. We launched first tvs in india, first tvs in the uk and germany, including what weve done in the u. S. It does appear were getting a flywheel effect. Its such an amazing time with streaming media, you included, as we see new services coming on board on top of netflix and amazon video with things like apple plus and most recently disney plus. Baby yoda works. Customers are increasing connected. A busy little guy hes very popular. I always ask you about the Business Model behind alexa. You always say, well, were trying to get it out there as much as possible, no hard profit and loss calculation but it reminds me of the browser and search, the way alexa is rolling out there. The interface on the one hand and then a sense of peoples intent how much are you learning from the data thats coming in that way thats cycling through and making alexa smarter and smarter. Thats what were focused on right now, which is as we see what customers resonate with that could be smart home, music, podcast, then what we do is try to double down on research and development and innovation in those areas and increase the breadth of the features. When we first started with smart home alexa new how to turn on and off lights now we have 95 device connecting to 190,000, connect everything from toaster oven to ceiling fans. How does data affect strategy are you looking at the data and say weve got to do toaster ovens now because people are asking for that with alexa. What you do see is what people are interested in, might be using echo. A lot in the kitchen la leads you down the path where you start experimenting with things in the kitchen. You do apis, partnerships with discovery, food network kitchen, to see will customers resonate with recipes half of alexa customers last year interacted with the recipe. You wouldnt have thought about that if you didnt experiment across these different areas. How is the feedback customers have given you about privacy changed over the past year you have ring now . There have been all sorts of controversies around what the cameras are looking up in the neighborhood, how police get access to that footage are you getting a different kind of feedback over the last few months thats changing the way you communicate to customers about what this is and what your policies are. We continue to see incredible momentum with the ring business. They had another record holiday. People loved their door bells and increasingly smart lighting. Youre right theres a lot of bad people in the world trying to penetrate networks and try to get access to peoples devices and homes. Its ours to build worldclass protections. There werent breaches of our system but people using dark web and finding ways of individual cameras. We added more protections over the holiday. Were going to have twofactor authentication moving forward. In addition over the holidays we added notification if anybody logs into a new user logs into a ring camera, the new owner gets a notification so they know whats happening. Thats important move how long before the data consumers are putting in through the system through their alexa request, et cetera, starts informing ad placement more and more and becomes a real revenue driver we havent really focused on ads that much. Theres certain types of capabilities on alexa advertising driven for example i can set a news briefing in the morning and listen to cnbc and listen to another news briefing. If thats advertising driven, we do support that. We havent really concentrated much on specifically billing ad networks out for alexa, feels too early. You have to be experimenting, taking the data you get and say how would we target ties, make the experience better when we eventually roll that out. Not experimenting yet someday we might see that if it adds value to customers but right now thats not something were working on. Lets determine when youre going to do that i think when we can find products that will resonate with customers that the advertisement adds value so one example, another place were on alexa, we have ad supported content is with music. Theres plenty of great momentum with ad subscription supported Music Services, amazon has one. Some customers want the value where its free. So we have put amazons free Music Service, ad supported, spotifys free Music Service on alexa to give customers that choice many do. Tens of millions of customers have opted for that. So if we actually see theres a Value Proposition for customers, and it resonates with them, i think thats when well experiment. Weve covered ground because amazon is covering a lot of ground lilt realterally at ces thanks for being with us carl. Thanks. Still a new alltime high for tesla and the dance that everybody is talking about we cant see it enough squawk on the street back in two. I can. The two words whispered at the start of every race. Every new job. And attempt to parallel park. electrical current buzzing each new draft of every novel. typing clicks the finishing touch on every masterpiece. newborn cries it is humanitys official twoword war cry. Words that move us all forward. The same two words that Capital Group believes have the power to improve lives. And that, for over 85 years, have inspired us to help people achieve their financial goals. Talk to your advisor or consultant for investment risks and information. Talk to your advisor or consultant weveryone, looknk isntat your phones. The design thinking, the digital engineering, security, blockchain, and we will be first to market yes. When we do we launch . Unfortunately, in 2 or 3, hours. Why the delay . Cognizant is helping banks use Digital Technologies at scale to advance speed to market. Actions speak louder than words. She was a school teacher. My dad joined the navy and helped prosecute the nazis in nuremberg. Their values are why i walked away from my business, took the giving pledge to give my money to good causes, and why i spent the last ten years fighting corporate insiders who put profits over people. Im tom steyer, and i approve this message. Because, right now, America Needs more than words. We need action. A big day for etf spotlight, look at energy, spider xle Analysts Expect geopolitical tensions to result in unplanned oil shortage in the middle east elevating a likelihood of oil spike. Sector laggard over the last 12 months chevron, second largest u. S. Oil Company Feeling pressure ceo Michael Wirth did join us earlier, the slight uptick in Oil Following the attacks was not surprising take a listen. We saw the attack last year on Critical Infrastructure in saudi arabia and pretty quickly the market reverted to areas it hadnt been before we continue to be in a market and this event while certainly is news worthy didnt fundamentally Strike Energy infrastructure or change the supply and demand dynamics in the market so i think certainly a reminder of the risk that exists in our business that fundamentally hasnt shifted supply and demand where essentially supply gets set. Maybe more interesting was his answer to brian that if oil stays around here, dont expect cap ex or r d to go up priority remains on buyback and dividend and answer to your question about how they are starting to present themselves to different constituencies. That becomes a more and more important part of the way they articulate at least their strategy given how many investors investing in esg with that title, environment is the first part governance checking boxes going through the way they are trying to show themselves to be worthy of that investment approach, but its a tough one. Yeah. Overall, though, i think its really notable we certainly had analysts and Energy Market commentators coming on that say this is essentially shortterm phenomenon in terms of move higher in oil prices doesnt change the fundamentals. But to have the ceo of one of the largest integrated oil majors in the world come on and also say the same thing i think really throws the weight behind what the street has already been anticipating okay meantime, take a look at shares of tesla hitting a new record high this morning now trading around 460 a Share Company announcing a program to build model y at the factory model 3 cars to the public where during the ceremony ceo elon musk broke out in a dance. You can see that right there some dance moves its incredible. This symptom really continues to break out to new highs the narrative is certainly shifting given everything were seeing in terms of production starting to ramp up in china it will be interesting to see what happens with model y especially given comments in the past, what margins can look like compared to model 3. Torn on the name, Credit Suisse keep underperform but forced to bring target from 300 to 240, which used to be an upside market, now a downside one. A lot of people, a lot short tesla that dont believe in the story, the ability to meet growth targets out there and eventually they will burn through even more cash they have been wrong they have been right sometimes but wrong longer period. But it is interesting in general when you have so many different automakers now launching their own electric vehicle models this year in 2020, it does seem likewere finally hitting this i cant even with this video. Were having this conversation and no one is listening. I want to get on the stage with him and dance im feeling motivated. It is, 2020 seems to be poised to be the year of ev and tesla does have the lead in that so well see how it plays out. Still baumer doing the monkey dance is the best ive seen. That one, too. Maybe bring that back at a microsoft event. Lets accepted it over to sue herera for an update. I followed baumer on that and now elon musk. Here is whats happening a stampede at a funeral procession killed 16 people and injured 200 more as of now no indication what set off the stampede 6. 4 magnitude quake struck puerto rico before dawn and followed three hours later by an aftershock measuring 6. 0. One killed, 8 injuries the largest in quakes that struck the u. S. Territory in recent days. Harvey weinstein arriving at court for the start of jury selection in his Sexual Assault trial in new york. This comes a day after prosecutors in los angeles brought new charges against him. Jury selection could take weeks. And a Spacex Falcon 9 rocket was launched last night with the third batch of 60 satellites for the star band network. Mini satellites covered in dark coating which spacex agreed to test to satisfy astronomers who feared having the night skies filled with thousands of bright satellites in the future interesting experiment thats right up your alley, morgan thats the update. You know it is. Well be talking about it more in the next hour or two. That was a record setting launch for Spacex Spacex is the largest operator in the world of commercial satellites after that last night. Its an amazing story. Sue herera, thank you. You got it. Up next, ceo of impossible foods on the companys new plantbased pork products. Quk t see rurns in two dont go anywhere. With Td Ameritrade youve got courses, tools, and help from pros. Its almost like youre training me to become an even smarter, stronger investor. Exactly. rocky theme music fiftysix straight, come on thats it, left trade right trade. Come on another trade, i want to see it more 80sstyle training montage . Yeah. Happens all the time. Lets get back out to las vegas now and ces show our own Julia Boorstin is sitting down with a special guest. Julia. Thanks so much, david im joined by ceo of impossible foods. Thank you so much for talking to us today you Just Announced a big new product, impossible pork how important will this new product be to accelerate your growth its huge our mission is to completely replace animals as a Food Production technology by 2035. Pork is the single most widely consumed meat in the world, more than 250 billion pounds are consumed annually. Our mission is global. In the u. S. Beef and ground beef are the most iconic meats but global its pork, so this is going to be extremely important for our future, particularly internationally. Your main rival, beyond, had pork alternative sausages and patties back in 2017 and 2018 was when they launched those two products what took you so long to get this pork alternative, and are you concerned about playing catchup . First of all, our main rival is not beyond meat or any other plantbased company. As far as im concerned, i wish them nothing but success they have the same mission we have the only rival we care about is incumbent animalbased industry. We are not going to launch a product until we feel like we have something that passes our very high standards. So this is something weve been working on for a while, and its gotten to the point where you feel like, okay, this can go headtohead against any pork from a pig its good to go. In terms of good to go, you do have a partnership in place but they are having concerns about the supply chain will you be able to produce enough to really expand this yeah, actually, a very good question and also something that is we learned a hard lesson last year when the demand got ahead of our ability to produce. Were not going to make that mistake again. Its a factor when we launch a new product, were not going to launch a product and were not going to launch a new customer until we know we have the capacity to meet whatever demand might come our way, so i think were good there. So how do these new products and partnerships impact your ipo plans . Well, we dont have any ipo plans at this point. I think its reasonably likely at some point that well go public but its really not an important consideration right now. Do you think it will happen this year . I really cant say. Morgan, you want to jump in here. I do. Thanks, julia. Pat, Morgan Brennan here thanks for coming to the show. Given the fact you are looking to expand in china especially nonprork product, also awaiting approval in europe as well how are trade problems affecting and how are you navigating this. Its something thats come up in our conversations with china. In as much as we are waiting for regulatory clearance to sell in china, it hasnt really affected our business yet its definitely something were keeping an eye on. Now, morgan, do you want to keep going there or should i keep go ahead, julia. So one questionas you introduce these new products, you face a lot of criticism about the Health Benefits of these. They are processed they are made with oils. Im wondering how you address concerns these are just not that much healthier than actual meat as you continue to expand your product line. Well, one of our Core Principles is were not going to put a product out that we dont believe is significantly healthier for the consumer, better for public health, better for the world and the product it replaces our pork product has 40 lower calories, 60 less fat and 40 less saturated fat, 0 cholesterol, higher iron and none of the contaminants that are prevalent in pigbased products so i think that its a clear winner from a Consumer Health standpoint. Do you feel like youre going to need to iterate the products and make them healthier. For sure. Will these products change to become healthier over time. First of all, i think this is a way healthier product for the consumer than the pig derived product, just in terms of calories alone but yes, the thing is the Core Advantage that we have over the incumbent industry is that we can continue to innovate and improve. The pig stopped Getting Better making meat a million years ago. So yes, were constantly working on improving nutrition, deliciousness, versatility, all those things. What about new products whats going to be your next thing . Are you working on a bacon we have done some work on bacon. Weve worked on pretty much anything any product that comes from an animal whether its terrestrial or fish or shrimp or anything like that, theres work ongoing about it. You can be sure in the next few years were going to be launching products to cross those categories. It took a while to get this one right. Do you think your pace of Product Introduction will be faster Going Forward yes, it definitely will be. First of all, it took us a long while to just understand meat at the molecular level so we could be smart about creating new products not only i would say is the pace of new Product Development getting faster, but were Getting Better at Getting Better the whole innovation cycle is accelerating on top of that, we have been building up our r d team were probably going to double the size of our r d team in the next 12 months because this is the most important problem in the world. Its a really hard scientific problem, and were all in on it. We look forward to tasting the new pork product im sure it will be very interesting to compare that to the animalbased one thank you so much for joining us here from ces. We really appreciate it. Morgan, back to you. Julia, thank you. Lastn e return, the te o Carlos Ghosns escape from japan. The dow is down 90 points. Ern obstacles. Lease the 2020 nx 300 for 359 a month for 36 months. Experience amazing at your lexus dealer. Were committed to making college more affordable. , thats why were keeping our tuition the same through the year 2021. [woman] i knew snhu was the place for me when i saw how affordable it was. [narrator] find your degree at snhu. Edu. The best of the best find out more on cnbc. More squawk on the street coming up. Legendary terrain in telluride, the unparalleled landscape of park city, or the famed peaks of whistler, youve faced the hassle of lugging your gear through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. There he is. Boogie man yes. The control room is enjoying this. Im enjoying this. Musk has a lot to go before he gets to that. Look at the vertical height on baumer. He was incredible yeah i miss that. Look at him, hes so psyched meanwhile, the stock price, none going down as ceo. There goes the jacket. The dance, look whats going on all right. Were not going to get tired of that one. No. Authorities in japan issuing an arrest warrant for the wife of carlos ghosn as details trickle out how the ceo escaped the company. Phil lebeau has been monitoring it and following it. He has the latest for us. Reporter the arrest warrant is one of the developments in this carlos ghosn investigation. Carole dpoechl, tghosn was name. Japan is accusing her of giving false testimony around april of last year. Here is carole ghosn talking to us about the situation carlos found himself in during the 13 months he was under arrest in japan. Id like to speak to my husband. I miss him dearly. I wish i could go and be with him at the hardest time of our lives and to take care of him. He really needs me i need him this is just cruel and they are punishing us they want to break carlos. Its a way of putting more pressure on him. It doesnt make sense why i cant see my husband hes combative and wants to prove his innocence. He knows hes innocent thats why he didnt confess to any of these allegations, even though he was in solitary confinement for 130 days. Well, now he is in beruit how did he gets out of japan well, it was by a charter airplane in fact, we have learned that it comes 350,000 to get him to turkey initial payment was made to an aircraft operator that flew him from osaka to istanbul, turkey, and then he took a second plane from istanbul to beruit. No second payment has been made. Its still unclear had paid that 175,000 at least on the flight from osaka to istanbul, he road part of the time, its believed, not confirmed, but believed in this Music Equipment box. The white powder you see there is when they dusted it for fingerprints we did talk to sources in turkey that said, look, there were holes drilled in the bottom of this box this box was found on the plane after it landed in turkey coming back from osaka. So guys, a lot of developments but what everyone is waiting for is to hear from carlos ghosn that should be happening tomorrow when he holds a media event in beruit. Phil, any expectation in terms of what hes going to have to say presumably hes not going to go into too much more detail about his actual escape and the logistics itself, right . No. I expect no details at all, no comment at all wouldnt be surprised if there was some kind of requirement made for the press who are there that, look, youre not going to ask about his escape because hes not going to talk about it. Hes going to make no mention of all of that. He wants to focus on the allegations japan filed against him regarding not reporting all of his salary and withholding tens of millions of dollars. Thats the allegation he was held under arrest in japan he wants to prove that those were bogus allegations while that will be the focus of his commentary, remember, most of the world is still focused mainly on how did he gets out of japan when he was under arrest. Such an embarrassing episode for the japanese authorities, thats for sure. Phil, we look forward to more clarity. Phil lebeau. The markets starting to erase earlier losses sawonhein0 pots quk t street will be right back at fidelity, youll work with an advisor on a flexible wealth plan. And with new brokerage accounts, your cash is automatically invested at a rate thats at least 21 times more than other advisory firms. Personalized advice. Unmatched value. At fidelity, you can have both. Unmatched value. Looking to get your business off to a fast start in the new year . Its go time switch to comcast business and get fast internet on the nations largest gigspeed network. Plus, complete reliability with 4g lte backup. And, cloudbased security to help protect the devices on your network. Greenlight your business in 2020 with fast internet and voice for 99. 99 per month. Act now, and get 1 year free of wifi pro. Call today. Comcast business. Beyond fast. Watching boeing this morning. Lets get to dominic chu for a market flash boeing shares have been moving steadily higher and sharply around the 9 45, 10 00 hour on some unconfirmed reports and rumors that Berkshire Hathaway and Warren Buffett may be taking interest in the stock. We have reached out to Berkshire Hathaway in response to the cnbc request for comment, theyve referred us to some of their own corporate guidelines, in essence saying that they do not confirm nor do they deny any kind of market rumors whether they are correct or incorrect because they do oftentimes traffic in many of these securities, buying or selling, one doesnt preclude the other. What that then means, though, is that berkshire is not really saying anything about whether or not boeing is in their crosshairs or not. That is the statement that weve received from Berkshire Hathaway, again referring us to their corporate guidelines david, read into that what you will, but boeing shares had been rising on some of this rumor or speculation. Berkshire is in essence saying they never comment one way or the other on anything correct or incorrect with regard to the market action, david back to you. Well watch the stock there perhaps well get more we never know. Meantime, goldman reorganizing the way it reports its Business Segments this just ahead of earnings next week Wilford Cross covers the company closely. He has more on what theyre saying is about transparent si exactly reorganizing, the segments, it breaks its earnings down in. If we can roll the prompt again, ahead of earnings next week and its crucial that it comes at the end of the month we have institutional client services, investment banking, investment management, and finalfina finally investing and lending. The key change well see is investing and lend willing go away and its parts redistributed among Global Markets, investment banking, Asset Management and consumer and Wealth Management the i and l part will mainly go into Asset Management whereas the lending part will be split down based on client, so Corporate Lending will go into investment banking, private client will go into Wealth Management i and l has been seen as a black box, commanding a lower multiple than the other parts these changes are an attempt to rectify that and allow the ceo, david solomon, to clearly articulate his longterm priorities, breaking out roe by segment for the first time at the moment, Goldman Sachs is on a 1. 05 times the multiple compared to jpmorgan 1. 8 a 7 discount. Stanley is thought to be easily recoverable if invest today goes well and the 1mdb issued cleared up theyve played catchup. This week theyre up over 20 , the bank index is down week to date this announcement certainly the first step forwards impressing investors. That investor day is an important one for them absolutely. More so than many of the institutions you mentioned that trade at higher multiples. Goldman has changed in the last couple years, in the midst of significant change those roe targets will be very important because theyre the first ones youll hear on specific Business Segments that didnt exist to some extent. Its not make or break but a significant milestone for the new management team. I think whats interesting about the way theyve announced this today and the stock price reaction is the latter half of last year, when we still hadnt reached the investor day and the date was pushed back and it was going to be a 2020 target, people started to get concerned, have they got things not to cover up, but are they not excited enough about their own forecasts. They suggested they wouldnt give specific targets. That list shows thats not right and theyre take their time to get things aligned as they want more within the individual segments, one, we know that the consumer this is still very small, we saw that under 5 , Global Markets is going to increase in size and the much sort of maligned trading is going to increase in size as well, perhaps what people wouldnt have except expected for a new Goldman Sachs. As we wait for it to be consumerized, it willing a big investor squawk alley moments away. Live coverage from ces continues tethbrk. gentle music did you know that americans that bought gold in 2005 quadrupled their money by 2012 . And even now, many experts predict the next gold rush is just beginning. So call u. S. Money reserve, the only Precious Metals Organization Led by a former director of the United States mint. As one of the largest u. S. Gold coin distributors in the country, u. S. 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