Transcripts For CNBC Squawk Box 20130930

Italian bonds and shares following after cabinet leaders, Silvia Berlusconi threatens a new election. Well talk with ross westgate. Hsbc purchasing Managers Index is showing growth. It has been below expectation. Thats three big stories for a monday morning, joe. All of them probably more important than any merger that could happen on a merger monday. 6 beltway ben. I think hell have an answer. Hell have an answer. Redskins won finally. Redskins won finally. Can we take a look. Do we have the stock of gray matters by the way . Are you pumping another one of your pieces . I dont want to talk breaking bad at all if we can avoid it. Do you think the stock may be up or down . I dont know. I dont know where it will be this morning. I dont have an article about it. Given what it must be something to do with gray matter and the final episode which i havent seen. I mean, i saw the daily news which says dont say it. Its on the front page. You should not spoil it. Its on the front page. For people who go to sleep early. They should not need to know breaking dead. Breaking dead. Theres a show on amc that has dead in the headline. Does it have a picture of walter white . Its a show you like though. Theyre walking. It ruined it for me. Walking dead is coming soon. Do you think anyone watched homeland last night . No, but a lot of people will watch it tonight. Theyll watch it on demand. Welcome to the future. I didnt see the patriots i saw the beginning of the patriots. I cant believe that they would launch i mean, why would you launch homeland on the same day. Sunday night football is the Biggest Network event of the week. Rightly so. I was thinking of having to tape breaking bad so i could stick with football. Do you believe that for a second . Thats a dirty, low down lie. I know for sure. I thought you were going to say have you ever taped a Football Game . Never mind. Football isnt tapeable. It is thats true. But thats the beauty of network television. You should watch every commercial and buy those products that are advertised on nbc. Oil this morning has been buffeted by things in the middle east more but well see if were going to shoot ourselves in the foot and cause an economic slowdown. The ten year will be bullish for bonds as well you would think. 261 now on the ten year. Thats going to be interesting to watch where the ten year goes. The dollar has been weaker although thats better. 1. 35 is kind of the cutoff for the trip, european vacation. Im going to mexico. If it gets below 1. 30, then when did you do japan . Thats so far. Isnt it on be the other side of the world . It is. Yeah. Thats difficult. Have you been . Youve been. Ive been. Sushis good. The sushis good. Thats one of the reasons youre still in the city, right . They have access to all of the international. Chinese food, sushi, dry cleaning. Quick look at gold. I dont know where to tell you where gold heads on any of this. I can make a case for gold going up or down. Were all talking about it, shutdown of the government could impact squawks breaking news programming. One of the unintended consequences could mean a delay in the big jobs report which is due on friday. Thats how we gauge the next fed move and whether the last fed move was right. I saw john harwood. Sometimes its fluffy. Today it looked a little limp. So you fixed it. Thats good. I didnt do anything, joe. It dried. It dried. It was a shower, it gets wet, then it dries. So you acknowledge earlier it was wet because you just got in the office. I was happy to see yeah, i hadnt been up for a few hours. I will cop to that. Im with you. Youre doing great. But i was happy to see the redskins yesterday. Yeah. I have to tell you, i did not watch most of the redskins game. Ill bet you didnt because this is pretty compelling, this stuff. No, no, no, thats not why. Oh, why . Because i was o on a little bit of a homeland bender in the runup to the first of season three catching up. Then i did watch the season three open last night no kidding . Yeah. Yeah. So, you know, i kind be of have gotten conditioned by the first three games of the season to getting my expectations down. I can come back to it later when rg3s knees a little bit healthier. You could be a bengals fan then if youre conditioning yourself like that. How are they doing right now . 22. Cant beat the browns. I dont know. You know my team. Hows andy dalton playing . Hes okay. My team has always been and will always be the broncos. I went to school in colorado. Well, thats a happy story. Yeah. Im a broncos fan. Im a denver fan. Ill always be im really quick to jump on the bandwagon. Pretty fun to see peyton with weapons. He is just unbelievable, isnt he . He has wes welker over there, too. Anyway, john, 18 hours because its 6 00 a. M. I came up with that quickly. 12 hours to 6 00 p. M. And then six more hours and then we see, right . It is a drama of trying to figure out when is the moment at which john boehner cuts loose the 20, 30, 40 Tea Party Republicans who have been hijacking his strategy. Can that happen tonight . If the Senate Passes a clean extension of government funding, will john boehner say to those people, hey, guys, sorry. Were going to go ahead with an extension of government funding and were going to do it without you or do they need the backlash, market reaction, the phone calls from wall street donors to say to the Republican Party after a couple of days, nows the time when youve got to do it . Thats what were thats the end point were getting to. Theres going to be an extension of government funding. The question is when does boehner make it happen, either with republicans or with republicans and democrats. What about a bill that just does the medical device thing and everybody says were all happy . You know, i think the medical device tax may go away, but i dont think its going to go away in this process. You know, it is theyve got 79 people who have gone on record in the senate saying theyre against it. Its not that hard of a target, but democrats believe that theyre and republicans believe that democrats are winning this fight because it is so clear whats going on that they can hold out and pass a clean extension of funding. Maybe theres a wink and a nod and say, yeah, we will get rid of this tax a month from now or two weeks from now or after you raise the debt limit or Something Like that, but i dont think its going to happen in this process. All right. So whats your well be done by when . Well be done within 48 hours . What do you think . Itll shut down for a little while . Yes. I think thats a reasonable expectati expectation, within 48 hours. Thats only done on this portion of the fight, joe. Weve still got to go through this on the debt limit. I was talking to somebody in the Republican Leadership over the weekend who said the way that this the government funding gets extended is that the speaker puts it on the floor and a bunch of democrats vote for it, a bunch of republicans and the republican resisters, theyre all going to be voting no but hoping it passes, what they call the hope yes vote no caucus because they know that theres a lot of heat on their party but theyre not going to be associated with it. The question is, you know, when exactly does that moment come . And i think within 48 hours but what this aid was telling me is whenever we get to the debt limit, which is supposed to be raised on the 17th of october, we have to go through the same back and forth again to get that done. Okay. John, dont go anywhere. We want to bring ben white into the conversation. Hes politicos chief economic correspondent. Does what john said make any sense to you . Do you want to differ with him . No, i dont think id differ with him. I think theres you know, the republicans want some sort of victory in whatever goes through the senate. They want the medical device tax in there. I think john is right that harry reid and the democrats in the senate are not going to give up on that. They think they have a winning hand here. Therefore, youre saying we get shut down. We get shut down unless boehner can get closer to the moment. How many days . Couple of days. A couple of days. The heat grows on republicans. No chance of just a weeklong extension . Theres a chance of that. You can get a clean seven day extension out of the house and through the senate. You have to get what to happen before that . What kind of fig leaf, olive branch has to happen . Thats the problem. House republicans need something in a funding resolution they can point to and say we got that. The medical devices tax would be the one thing. There are so Many Democrats who have medical device contributors who dont like it. So far the democrats are so hard lined that were not giving away anything. Theyre not going to give into hostage takers. I dont see how you get that. That doesnt mean you dont get a short extension that passes with mostly democrats and some republicans. Thats possible. You did this in morning money. Do it for the viewer. What does the world look like with the government truly shut down . What is shut down and what isnt . Well, all nonessential stuff is shut down. National parks. Normal people are not going to notice that much right away because the military will get funded. Your trash is still going to get picked up. There wont be a lot of immight yaet impact on the real world. Thats less pressure on republicans to cave. If it drags on longer i think the impact is bigger on confidence, its bigger on the economy at large. The real problem to me is if you drag on this fight for a couple of weeks you come right up against the diebt limit. Government is still shut down. Then you get more reaction in the bond market. Maybe that raises the pressure ultimately. Is there an arg ghumt bad news is good news and if you get the shutdown it forces the issue on the debt ceiling and you dont have a problem . Theres a chance of that. Thats the goldie locks scenario. House republicans who arish itching for a fight, they say we stood up to obama on obama care. Then it turns around. The polls are bad for them. Boehner can say, we did the best we can. We have to raise the limit and move on. There are a lot of things going on. Whether we shut down or not, theyre going to roll out obama care. Yes. Theres these glitches. No one has tested the system yet. They point out that people that they need to sign up even if theres the slightest glitch at the start and it doesnt work out, that can poison the experience for netanyahu people to mess it up. Then the democrats can say that we could have rolled this out if the government hadnt been shut down. It almost gives them cover for if the republicans stood aside. You think obama care might be it might not be a great roll out. Might fall apart eventually. It might. The democrats will say people will enjoy the benefits when they get them. Im not saying thats right. Thats their hope. Explain the political calculus here. I dont understand. We keep talking about how the republicans are holding it up. My question is if thats true, what happens to 2014 . Twhoops 2016 . I think with 39 Approval Rating for obama care, i think a lot of people are like i dont like it. I dont like it either. I dont like what the republicans are doing but i agree basically with the principle of not letting the law go forward. Joe, this is when you look at the polls on obama care, there are more people who will say that they dont like it than like it but this is very much a partisan deal. That is to say, democrats like it, republicans dont like it. Theres a good bit of intensity to the Republican Opposition but people dont move very much. Theyre going to react to the law based on the personal experience that they have with it if its a bad experience, thats going to be bad news for democrats. Theres one thing to move it along, theres another thing to not have a shutdown. I havent seen the poll. Do you not like the law . Republican leader well, andrew, weve done polling on this and the polling says do you want obama care defunded . A plurality of people say, no, we do not want it defunded even if more people say they dont like the law, they dont want it defunded. Secretarily, if the defunding involves a shutdown its overwhelming against it. This is why the smarter republican strategist within the house caucus are afraid. Thats why theyre trying to beat the tea party is they believe this is the one thing that could jack hammer them out of the majority of the house of representatives. Its not easy at all for democrats to win the majority back. Theyre not likely to do it. But if you have a shutdown, a debt crisis, everyones going to see where it came from and it came from the Tea Party Wing of the Republican Party. Thats how they could lose it. Thats why theyre so republicans are so concerned about it. Just one final point, let you guys chew on this. This is the first strategy the first standoff that ive seen that is so disconnected from normal legislative back and forth. I was on with jim nussel in worldwide exchange. This is jim nussel who was once a renegade house member, bushs omb director. I dont even know what victory looks like. We had him on last week. No one could get a word in edgewise. He was so animated. I dont know what hes smoking. Everyone involved in this knows that the speaker himself is against the strategy that hes pursuing. He just hasnt been able to stop it. Well see. No ones Approval Ratings are going up right now. Well see what happens in 2014. If i were you, id just keep your eye on the senate too, john. Youre going to be putting out fires all over the place. The senate isnt necessarily, you know, going to go the way Everyone Wants at this point for you either. So youre going to be putting fires i dont know about for me but republicans have got it shot. Im tickling you. Im tickling beltway ben here, too. Republicans have a shot to take over the senate. No, but you may think theyre going to get tarnished. I dont think president obama i dont think his numbers are going up in the midst of all of this. Everybody gets hurt but republicans have more on the line. Up negotiate with iran but you wont make a call to the leaders of the house . I mean, youre hearing that a 4r09. That sounds good but doesnt mean anything. I know. Still, people remember that. You know, its his biggest really it looks like his biggest enemies are not assad, putin, or rowhani. Theyre frenemies. The real enemies are tea party guys. Thats crazy. You know who doesnt believe in the effectiveness of that talking point . Every single republican strategist you can find. Theres nobody who thinks what the Tea Party Caucus is doing is smart politics. I know. Well see. Nobody is winning here. Nobody looks good. Even the journal here. Ryan and obama. The leader of the budget parties neither one is around. Its not the budget. We wanted to have ryan on the show. Remember that point. This is not about the budget. Forget about what i said. You were pouring over the guest list. Thank you for the report. Ben will be with us. Im not going to out you on that. I love you. You just did. Im not paying that much attention. Time for the Global Markets report. Tros westgate standing by in london. Ross, you come prepared. Whats the worst bond yields that were seeing in these new countries that are getting screwed up . Were not back dating. Were near where we were in italy, arent we, even though it was a rough weekend . Yeah, no, were not. Spreads over about 300 bases points which is the widest for, what, about, i dont know, 12 months or so but nothing dramatic. Equities have been dragged lower by u. S. Performance and whats going on with u. S. Politics. 9 to 1 advancers being outpaced by decliners. The ftse was down 1. 3 . Xetra dax, cac carant down. At the weekend mr. Bur lus skoeb any ordered five people to leave. There was a conference scheduled for tomorrow but its been delayed to wednesday. The Berlusconi Party has been fairly split. At the moment the hawks seem to have won the power. They would like elections as soon as possible. So well see. This confidence vote, therefore, is going to be fairly tight on wednesday. If it doesnt get enough support the government will collapse. There may be enough time to get some measures through, particularly they need to support an electoral change. They dont want another election because thats whats thrown up the instability at the moment. They may be able to get support from them. It has causerd the ftse to fall. Its also meant the banks have gone down fairly heavily in italy as weve seen yields rise. Italian banks have gone lower. Down between 2 1 3 and 3 1 4 . The ceo effectively resigned by the board over the weekend. It was expecting he would step down at some point but hes gone earlier than expected. Lets show you where we stand with italian yields. They have gone up to 4. 64 . We were higher this morning up to 4. 73. We had that spread between italian yields and german bond yields, clearly below that at around 290 bases points. Thats where we stand. Back to you. Ross westgate. Thank you for that. Coming up, all bad things must come to an end. Joes mouth is dropping here. No. Breaking bad Season Finale aired. Advertisers put up big bucks to be part of walter whites return to new mexico. We have that story when we return. Do you think it should be out and about or do you think they should do it in icahns office . We went last wednesday . We went to michaels. Table 4. Table 4. Do you know where table 4 is . I dont even know. In the back. Great second room. You looks at fish bowl lunch at michaels and theres a chart and a diagram. Youre such a media powerhouse that you get one of these thats gary dollos table. We get, hes not there. We can sit you at barrys table. We have another table to talk about. I promise we wont spend thing. All bad things do come to an end. Breaking bad. I dont want to see this. Youre not missing anything here. The amc show reportedly pulled in up to 400,000 for 30 seconds of ad time. Not super bowl money but not bad for cable. The spots are the same price range as shows like american idol, modern family. Its saying amc has underutilized cable channels. Stock is up 35 this year. Berns says it could climb another 20 . You have a number of other shows coming out. Sol is coming back. Theyre going to put that show together. I wonder, it must be in the works now, what the plot is going to be . Because hes multitalented. I want to buy vince gilley began stock. He signed a show with cbs. He has this amc show, cbs show. Walking dead starts next week. Weve been counting down the days. According to an in house expert, my son, i think theres going to be a spinoff of walking dead which has other people other than rick, another group of surviving people. I want to buy the Vince Gilligan stock. I dont like spinoffs. They generally fail. I love the brands. Jonie loves chachi. Joey. That was nbc. Joey. Do you remember when Threes Company went to twos a crowd. Frazier works. Lavern and shirley. It does happen. Mork and mindy was a spinoff. This is true. Youre not walking are you up to speed on not up to speed. Never seen it . Need to get up to speed on that. Not really you. And then homeland. Theres guns. Now that i just finished breaking bad i know about guns. And death. What, i did not give you anything. Youve been watching the first two were there no guns . Are there guns . I didnt say anything about that. Im not talking about that. Coming up, look at the daily news. The fed left the punch bowl on the table but is congress about to throw a giant wet blanket on the markets and the economy in were going to open up that discussion next. Mine was earned in djibouti, africa. 2004. Vietnam in 1972. [ all ] fort benning, georgia in 1999. [ male announcer ] usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection and because usaas commitment to serve military members, veterans, and their families is without equal. Begin your legacy, get an Auto Insurance quote. Usaa. We know what it means to serve. She loves a lot of its what you love about her. But your erectile dysfunction that could be a question of blood flow. Cialis tadalafil for daily use helps you be Ready Anytime the moments right. 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Good morning and welcome back to squawk box here on cnbc. The headlines are what you can imagine. Futures are down sharply this morning as the threat of a Government Shutdown looms. The senate is expected to reject the bill passed by the house. They really should have rejected it yesterday but no one was around which would have funded the government. Harry has the keys and he said, i aint coming in. Theres no way. Could also delay implementation of the president S Health Care reform law. More on that in a moment. Twitter is yeah. Ive got you here. Its like i have someone here that i can run things by and immediately get feedback. You can needle me. Its like one of those things where you see the chart when people are talking and the audience level. Im watching you. Real time reaction. Buffeted all over. Youre saying things that are demonstrably false. Okay. Its in the eye of the beholder. Youre beltway ben. These are antibeltway things. There is another just like andrew now knows, manhattan is an island. Theres a whole world west of manhattan. I live in new jersey. Im a jersey guy. Tentacles how often are you down there . Four times a month. A lot. Lets be real. Twitters reportedly set to unveil details from its recent ipo filing that was done on twitter. It will been done on a confidential basis. It can soon be made public, which we love transparency. Twitter could begin trading by late october and early november. Italian bond yields are soaring today. Nowhere near where they were at the height of the european crisis. Former Prime Minister berlusconis party pulled out of the coalition. That could put italy on course for new elections. In this country the story of the day that hopefully theres no way we can talk about it too much because we are going to. A lot. Hopefully youre interested in this story. Thats why i started harwood with a little football. Sports. Were going to talk about it. What we say doesnt matter. Its going to be what happens. Theyre not even up yet. Their alarms are going off. Im ready to do a talking bad visited situation. I think we talk about harwood not watching the redskins. Incredibly disappointing to me. Hes watching homeland instead of football. Thats a problem. The threat of a Government Shutdown is going to impact us. Joining us, hans and carl riccadona. I see the futures, but i dont you see the future or you see the futures. I see the future. Call me now for your free reading. I dont think it should matter. I dont think its going to. I dont like the market reacting to this right now. I think its going to be over quickly enough. We have bigger longterm issues that should affect the market. This seems like it should be in the market already. This is coming at a uniquely bad time, right . The market is up almost, what, 20 on a total return basis on roughly maybe 5 Earnings Growth. Volumes have been light over the last couple of months. If youre volatility has dropped off. If youre looking for anything to tip it over, this would be a good thing to do it. Its not only the budget fight but the debt ceiling that comes after that. Theres been a remarkable lack of anything to knock the market off the pins this year. Its been our concern that this could be it. And, in fact, its shaping up to be a properly good fight which unfortunately we didnt get a taper. We didnt get a taper. The thing is, one of the problems with this recovery is were above stall space. The slightest external thing can be a problem. Is this another absolutely. I think possibly the foresight of the fed knowing were heading down this bumpy road of dysfunctional government in october was one of the key reasons why they didnt pull out the taper. We still got to 85 billion. I think that scared them into waiting a little bit longer. If congress screws up and causes the economy to weaken, the fedotenko very well get the blame if they had tapered at the meeting. What would you rather . Would you rather have the 85 billion with the Government Shutdown or no 85 billion and no kbft shutdown . I would prefer to have no Government Shutdown. Id go with the 85. Give me 85 every month i can put that in the stock market and make that go up. Which is what happened. You think its a genius move to leave it there. It was erring on the side of caution. They were getting close to doing it. The last employment report. Nothing to do with all of these things weve been talking about . If its such a genius move how did they not know a couple of months ago when they were talking about tapering, how did they not know. How severe it would be. Now they do . Two weeks ago im not saying it was done for this, but this was one of the items on the list of concern. Two weeks ago, shame on us, i think there was a sense around this table, i could be wrong, that we were not going to have this situation. No. I think we were always going to go there. I said the shutdown was 60 to 70 likelihood a few weeks ago. The fiscal cliff you knew this was going to be a contentious event. This could be the tip of the iceberg. I think today is the canary in the coal mine. We had Grover Norquist on the show and he was saying, its all going to be fine. Were not holding anybody hostage. He may not be but the Tea Party Caucus is. Grover norquist, you could put him in the reasonable person. Hes not a rhino. This is over obama care, not tax hikes. Its a fight for 30 to 40 House Republicans who live and dye over obama care. When you lost the house in 2010 it was over obama care. When pelosi lost her speaker ship it was over obama care. When the president was reelected it was over obama care. No, it wasnt. You cant pick and choods which election why did he not get 39 you think being reelected was a stamp of approval on bomb ma care . Thats b. S. Thats b. S. It was in every debate with mitt romney. A lot of different things. You cannot pick and choods which elections. It shouldnt have been rammed through the way it was. That may be true. Poison the water for its one of the reasons that the jobless rate has remained suh high, the economy you can say evidence schmevidence. Why would you hire people if you cant afford to hire them . Theres no employer mandate. The earnings season begins on october 8th, right . Yeah. The expectations for Third Quarter earnings are rather weak, right. Theyre looking at this point to be something on the order of a. 7 increase on the prior year. Maybe double it. So 1 1 2 . Then youre into earning season as the debt ceiling argument starts to take hold. I cant think of a more perfect storm for the equity market than those two things coming together. Probably knock us down. You had a 10 Unemployment Rate and his first 18 months was spent in a knock down dragout fight where all of his political capitol was spent on it happens fairly easily over mitt romney. We have to run. In a vacuum you cant figure out other reasons why mitt romney lost . I assure you this debate will continue when we return from the break and clearly for the test of time. We have more Political Drama in southern europe, but will it turn into another fiscalisca fi. I was going to say financial crisis. Well see. Thats coming up next when we return. [ male announcer ] this store knows how to handle a saturday crowd. [ male announcer ] the parking lot helps by letting us know whos coming. The carts keep everyone on the right track. The power tools introduce themselves. All the bits and bulbs keep themselves stocked. And the doors even handle the checkout so we can work on that thing thats stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything. So everyone goes home happy. At bny mellon, our business is investments. [ female announcer ] today, cisco is connecting the internet of everything. Managing them, moving them, making them work. We oversee 20 of the worlds financial assets. And that gives us scale and insight no one else has. Investment management combined with investment servicing. Bringing the power of investments to peoples lives. Invested in the world. Bny mellon. Where are all the bond yields . Theyre not as bad. That was what we were going to wake up and see. There were three big events into the troubled economies over the weekend. Italian government on the verge of failure once again. The troika leaving greece, pausing negotiations with greece in terms of their next bailout and then several members of the Greek Parliament were arrested, part of this golden dawn. Think of them as fascists. Sylvia berlusconi wants to pull his people out of the government. He doesnt want to raise the federal tax to 22 . He might have to serve house arrest for one of his convictions when it comes to fraud. So the Italian Government is on the verge of collapse. The current Prime Minister needs eight defections from either berlusconis party or from the comedians party to keep the coalition in place. Theres going to be a vote on wednesday. The comedians party. He is a comedian. Hes called a comedian. I call him the comedian. Lets look at italian yields. That was the question. Theyve risen. Not as dramatically as you might expect. They got up to 4. 7 , now theyre at 4. 5 . Where is the above 7. Italy is different than greece and portugal. Because their budget wasnt as bad as those countries, they could live with the 7 yield for a long time and still not necessarily need a bailout. They have the greatest tourist attraction in the world. All the antiquities. No, food. Food. Thats my favorite. The coast. Tuscany. The people are lovely. The food is lovely, views. 30 seconds . Dude, i havent even gotten to greece yet. We have to get back to the shutdown. They might shut down the government. I know. Would that be a bad thing . Well talk about that. Government not doing anything. That would horrify me. Can i show the italian banks . Yes. I want to point out that this is the first big test since cypress and what did we learn from cypress. If you are a bond holder in europe you may pay. Now italian banks are not nearly under capitalized like cypress. Europe has made it clear they want to do bail ins, not taxpayer bailouts. That will put additional pressure on the italian banks. Can you stay here . Oh, yeah. To support you, yes. You obviously dont understand that because of the fiscal quagmire that weve been in, the government has been unable to pass the laws to get the economy going this time around. In other words, the governments in charge of getting the economy going . Yes. I thought you were in favor of planning. Thats what i keep hearing. Because of the intransigence of the fiscal side of things, weve been were only growing at 7. 8 because the government hasnt been able to the democrats havent been able to pass the law. More spending would help. We have two congressmen. You know thats where it comes from. Well debarrett thte this is if you would like to stick around. We havent had any investment. I love it when the government invests on my behalf. They invest chinas money into bridges to nowhere. Well continue this conversation during the break. Well get it. All is fair in love and war. Coming up, the shutdown countdown from both sides of the congressional aisle. Marsha blackburn of tennessee and john yarmuth will join us next to face off. [ woman ] id be a writer. [ man ] id be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] id be an architect. What if i told you someone could pay you and what if that person were you . When you think about it, isnt that what retirement should be, paying ourselves to do what we love . Paying ourselves maestro of project management. Baron of the buildout. You need a permit. To be this awesome. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. aaron purrrfect. vo meeeow, business pro. Meeeow. Go national. Go like a pro. Welcome back to squawk box. Wall street focusing on the drama playing out in washington over the weekend as the Government Shutdown looms. Here with more on all this, marcia blackburn, a republican from tennessee and house deputy whip. And good morning to you. Good morning. Heres the question. Why is it acceptable . And maybe i feel like im channeling beltway ben here to my left. He is to your left. Hes not. Hes new jersey ben and right in the middle. Why is it acceptable to shut down the government over an issue like this . We havent been threatening to shut down the government. I think this has been a part of the president s play book, its a power play. We understand he wants the checkbook for discretionary spending. He would like to have eric holder over there who is the attorney general helping the agencies decide what is and is not essential. And what we have continued to do is to send good ideas over to the senate. Why is it why is it acceptable to try to hold up the entire apparatus, the machine that is washington because youve decided you dont like obama care . Arent there other channels and other venues and opportunities to deal with this . Believe you me, we are trying to get everything we possibly can obama care is a program too expensive to afford. It was to be an 863 billion program. The price tag on it 2. 6 trillion. Look, i think theres a lot of things to debate. I think theres a lot of things to debate about the law. And im not suggesting that conversation shouldnt happen. My question is why does it have to happen in this context which clearly has a could have an effect on the economy and country. Were trying to get them to work with us on it. And the cr, the debt ceiling, were saying you have to look at obama care as a part of the spending component because there is 819. 3 billion of new taxes embodied in this bill. The insurance exchanges, the cost of Health Insurance on individual families. Now, 3,600 as a price increase since this president took office. 311 companies on a list i have who have already reduced, altered, removed insurance provisions for their employees. This has an impact all across the board. You have to deal with these issues. The exchanges are not ready. Right. Okay. Obviously you dont like obama care. We get you dont like obama care. But if the senate i dont like government control where it doesnt need to be. Weve litigated this matter. The bill was passed by the house and signed into law by the president and well the debt ceilings the law. We dont raise the debt ceiling. Thats the law. You would rather not look at this, im giving you an example. Youre saying its the law, you know, you have what were saying is there are provisions here that have to be changed. Okay. A simple question, though, if the senate if you could just let me talk for one second. Sure. If the senate were to send you a bill today that funds the government for a week, ten days, clean cr from the senate, would you in the would you support passing that so we can continue to talk about obama care. What else you want to talk about without shutting down the government and impacting markets in the economy . We were very disappointed they decided to take the weekend off and i understand we can play blame game. Well, but youre talking about hypotheticals. Weve been trying to get them. Its not the hypothetical. Its very possible you will get a clean version of a continuing resolution. Would you sign that so you can continue that conversation . Is that a possibility today for you . I think that what we p want to do is solve the problem. And weve been trying to do it and were disappointed that the senate decided they didnt want to sit here and work. Is that okay . Its not okay with me if we shut down. Were not the ones that want to shut down. Thats whats so interesting. Who wants to shut down its not you . Nobody wants to shut down. Well, obviously, the Senate Democrat leadership didnt want to because they want a shutdown . That doesnt make any sense. They decided they were going to take off the weekend and not come work with us. It was disappointing to us. Its disrespectful of the American People. We hope they get to town this morning, not this afternoon. Were still here working. Congresswoman, weve got to leave it there. We appreciate your time this morning and frankly i have to say i wish everybody in washington, including yourself a lot of luck today. Thank you so much. I hope some resolution is reached. Absolutely, thank you. Thank you. Youre not depressed about any of this, are you . I know how sometimes i get emotional. You do . I cry at car commercials. We have to go now. Ive been told, all right, rob. Coming up, will a Government Shutdown turn into a great opportunity for investors . And what does a shutdown obama care and the debt ceiling mean for steve case and all his ventures. Our guest host next on squawk box. Bny mellon combines Investment Management investment servicing, giving us unique insights which help us attract the industrys brightest minds who create powerful strategies for a countrys investments which are used to build new schools to build more bright minds. Invested in the world. Bny mellon. Ready to close the doors, the Government Shutdown looms as political posturing weighs on investors. We have all the angles covered as we get ready for a new week of trading. Table for two. Apples tim cook and carl icahn meeting today to talk about the companys next big buyback. Were going to take a closer look at the role of activist investors and top tier management relations. And a gamechanging mobile app that could reinvent the way people shop for homes. You know, ive always wanted a pad with a giant statue. I think i found it. Were going to hear from the ceo of home snap as the second hour of squawk box begins right now. Good morning, welcome to squawk box here on cnbc. Im andrew ross sorkin. Becky quick is out sick today. We all wish her well. Take a look at the futures. Giving the potential for a Government Shutdown, the dow off about 110 points right now. If we opened up, s p 500 would open off about 13 points. Lets get you through some of the morning headlines. The big one ive mentioned, the Government Shutdown looming at midnight eastern time today barring the lastminute agreement. The house passed a bill that keeps the government running, but it does delay president obamaS Health Care reform law. Senate leaders have already declared, though, that bill is dead on arrival and well have much more on that in a moment. Also, plenty of political turmoil happening overseas, as well, this morning. Members of former Prime Minister berlusconis party pulled out of the coalition and thats sending the country into disarray. It sets up the possibility of new elections, all that sending italian bond yields spiking. We have our own problems over here, lots to chew on, joe. Becky might be on some type of covert mission. You think shes in d. C. . Do you see what she does with us . The way when shes here and we end up hugging. Weve got to get a flight to italy. She could do a lot of good. What do you think if she could work for the u. N. . Secretary of financial state. Yes, she has performed under fire here. She has. But i just i just love you, man. I love you more. This is getting weird. Steve case is here. Wheres becky when you need her . You dont want a little bit of cooperation . We need more of it. Im not sure its necessarily you. You know, youre not looking bad yourself either. That hair. The federal government closer to the first shut down in 17 years. Im just reading here. Green eggs and ham reader, tea party for senator ted cruz, defending the conservatives demands on meet the press. People reject obama care. They understand its not working. The only people who arent listening to the argument are the career politicians in washington. Harry reid wants to use brute political force. I like when i intro a sound bite, john, i disparage. Did you write that for me, john . Me . No. John harwood joins us now with more. It is interesting what were seeing right now. And i do get tweets and mail. Just for the record, joe. Yeah. Nothing that cruz just said was true in that sound bite. Okay. I know, i expected to hear that. But maybe his hearts in the right place, how about that . Yes. Im sure that ted cruz is doing what he thinks is in the interest of of the American People but when he says the American People overwhelmingly reject obama care, thats not true. When he says that yeah, but democrats thats not true. Was the president overwhelmingly reelected . No, he was reelected. Okay. Because 39 and the numbers have gone down. Its not and, you know, your side explains it hasnt been sold right and the media gets in trouble for not selling it for the president for not selling it right. But its not a popular bill right now. And it should be. Were trying to give health care to everyone it could have been done in a way American Public opinion is very divided on obama care. It is extremely unpopular with whites. It is popular with hispanics and africanamericans. Theres a big divide according to who benefits and who who believes theyre not going to benefit from the law. Fundamentally what you have in Public Opinion is a set of americans who believe that they are going to be paying for health care for other people and that fuels the discontent. But the discontent is not overwhelming. It is were divided. You dont have a majority of people saying get rid of obama care. You have a plurality of people saying, i dont know, i dont think its a good idea. And when you ask them, do you want to get rid of obama care if that means a shutdown . Overwhelming thats whats overwhelming. 59 say no. No one wants a shut down in government. Thats like a loaded question. No one wants to shut down thats the option. Thats where we are. Right. I know what no one if you were im not going to phrase it a different way. But obviously, no one wants a shutdown in government. Youre not going to get for whatever means to an end there is, youre not going to get anyone to agree that we need a Nuclear Option to delay something. Theres something to be said for letting it roll out and then decide. At this point, the democrats are going to be able to blame all of this uncertainty on people not signing up or whatever. You know what makes the position that is being taken by cruz and the house it might be counterproductive for them. Its not connected to any rational policy goal, legislative process. Its not a budget negotiation. The two sides are not disagreeing about the budget. Basically democrats are saying, yeah, okay, sequester, fine, keep it going. It is it is republicans who believe theyre still acting, responding to the cues of the 2010 election rather than the 2012. Who believe they were elected to stop everything that went on in 2009, 2010. But the country is two years down the road from that. Obama was reelected. And they you know, jim nussle said, i dont know what victory looks like for republicans because its theres not a theres not a specific, achievable realistic thing in prospect theyre negotiating over. Theyre lobbing these demands on a president who was just reelected. And it doesnt really make any sense. Well, we got, you know, were going to probably this wont probably wont be talking about the shutdown by the end of the week. None of us know that. I agree with you. But then well go to the next thing and the thing after that and then the whole rollout is happening. And then its also october and now europes raising rearing its ugly head. And we havent talked about the taper today. Its irrelevant. Well, i would not want to be covering anything other than businesses right now and politics. Ill tell you that much. I feel like were right in the sweet spot. If only we had steve case here. If only we had steve case here. Bad for the nation, good for cnbc. But some of this, the concern about is it bad what do you mean bad for the nation . The debate right now happening in washington. Troubling to a lot of people, unsettling. This is democracy, we say it again and again is not pretty. Its not messy. I think we have some dynamics now that make a little bit more complicated. I think weve seen the people that used to come together in the senate dealing with these issues largely dealing with the the unifiers were primary to now, you know, people like senator cruz kind of come out of nowhere. His first year senator and can build significant momentum and visibility by taking on the issue. May not be right for the country, may not be right for the Republican Party. Theres more on the other side. I think theres a difference between policy and politics. Thats one of the things ive learned. Im trying to focus on getting the right things done. Last year was access to capital, now its immigration. Thats the big focus this fall. Actually, im a little disappointed theres so much focus on the issues like the debt ceiling right now and the government shut down because we need to use part of this fall to get immigration reform. Youve got more youve been moving right since ive known you. And i want to compliment you on that. I would say im moving to the center. I really believe, no ive always come on over. Ill leave the lights on. The private sector lights. Look at what the private sector on both sides. Look at what the private sectors done for you. Its been great. I must say, though, im a little grateful of the government making the investment to create the internet. Yeah. No one would disagree. I think theres a role for government, but obviously entrepreneurs, the market has to be the innovator. We need to remain remember, 250 years ago, america was a startup. The reason were a leader of the free world, we had the economy of course i celebrated and it is a legitimate role for the government. We have the greatest constitution and form of government in the world. So, obviously, there was a structure, i dont know if our forefathers felt weve got to go, john. Weve got to go. Were going to talk to bob dahl. Can i ask a quick question . Yeah, go ahead. My question for steve is, you know, i think some mainstream republicans as well as democrats have been waiting for the moment when the Business Community comes in with both guns blazing and tries to bring an end to whats going on right now. I know many Business People felt burned by what happened in the fiscal cliff when they wanted a big deal and it didnt happen. But what do you expect on wall street and in major American Business life in terms of a reaction to whats going on in pressure on republicans in particular to shut it down . I think the pressures intensifying. Two different events in the last two weeks in washington, d. C. Where people were talking about, one was fix the debt and other was related to the business round table. Concerned about whats happening with the economy generally and whats happening right now in washington. Theres pressure to get this resolved. And also recognition if were going to continue to have a Strong Economy we need to win this battle. Got to get these issues solved. All right. Lets get to bob. John, you guys have you went for the gray thing. I may do that. Look at these guys. Look at these. Authenticity. I think you guys have colors for credibility is what i think. Yeah, i have no gray. I go to a colorist to add the gray. This is true. Youve got the scoop. Honesty, transparency is what we want. Thanks. Stock Index Futures taking a hit on the prospect of a Government Shutdown. Joining us now is chief equity strategist. And this man has still has some color, some color going on because hes youthful and young. Bob, without getting political about it. I made the point earlier as long as we got the fed with 85 billion, id stay long. What would you rather have, 85 billion a lot, isnt it . Yeah, its a big help, joe. Look at the margin. For every week that the governments shut down, not that itll last that long is. 25 of gdp hit off the fourth quarter. Just at a time when we start seeing leading Economic Indicators and see globally doing better. Come on, guys, dont snatch the victory from the jaws of defeat as it were. Just at the point in time when weve got a shot maybe doing a little bit better. I thought for sure the next 12 months were going to be better than the last 12. We put enough of this into it, weve got a problem. Somebody mentioned earlier on the show, Earnings Growth going to be paltry in the Third Quarter. The only one way to look at it positively is the only reason they didnt maybe, one of the reasons they didnt start to taper was because they were worried this was coming. The quarter point that youre you bet. And the quarter point youre saving up. They mention it go ahead. Oh, i think youre right. Look, growth wasnt Strong Enough, inflation wasnt Strong Enough, but underneath the surface, i think ben bernanke was saying i smell shenanigans and its not the right time to taper. I agree with you. And it may be off the table for this year. So the quarter point that were getting cut off with the shutdown in some of the other stuff, we may make up on the other side of things. And sooner or later, we all know this is just temporary. Right . Well, it is it is temporary, but we dont want to do any damage to an economy thats already just not quite Strong Enough as you well know. How would that look . My view is if we dont let this pass soon, we could be i looked at the high for the s p at 1,729. I dont want to say that yet, but enough noise around this, the market wont like it. Really. So yeah, but its october. You mean, then the highs might have been. We dont hit new highs in the last quarter of the year then . Its possible with each passing day of the noise. All right. So youre not necessarily if you get 5 selloff, you wouldnt necessarily use all your drive power with 5 . Yeah, 5 , im putting money to work, joe. I think that could be part of the stluolution. If the stock market sends a nasty message to washington to get moving. Is he going to use the executive power on the debt ceiling . Is john boehner going to blink and try to do something with the democrats and few republicans . Theres a lot of possibilities around this. But the uncertainty in markets, hate uncertainty. You know that. Yeah, i do. Its almost certain this was going to happen. I view this as not uncertain. Its not bad to send a signal to washington. I remember five years ago with t. A. R. P. Theres a similar debate. People were debating the intricacie intricacies, the timing, maybe it didnt matter, maybe it did. That sent the signal to washington, suddenly the deal got done quickly. Hopefully today will be that wakeup call and will get done within the next day or two. All right, thanks, bob. See you later. Steve will be with us. Former treasury secretary neal wolin. What it takes to keep the government running and what it means for investors. And apples tim cook ready to meet with carl icahn today. What will be said and how will cook handle the brash billionaire . All that when we return. Welcome back to squawk box, the looming Government Shutdown is the primary topic of discussion on wall street and elsewhere this morning, joining us now to talk about it, former deputy treasury secretary neal wolin. And i teased before you were the treasury secretary. How many days were you . I dont know, andrew, about 40 days or so. So why are you former treasury secretary . Former deputy treasury secretary . 40 days. It was 40 days and 40 nights. Were going to work on your resume. 40 days and 40 nights. So good to be back with you guys. Whats going to happen here . We had a congresswoman on earlier on the republican side who suggested that the democrats were the ones that were Holding Government hostage in all of this. Is there any possibility for a compromise today . Well, look, just when congress ought to be doing things to reinforce the economic recovery, seems to me that House Republicans are really committed now to doing another selfinflicted wound on our economy. And theyre holding our country and our economy hostage to an idea that theyve tried 40 times to put forward into the congress. And its not been successful. They know full well these various proposals theyre putting forward in a fashion are not going to pass through the senate they know the president s going to veto them. And what theyre doing is to advance this idea that theyve tried repeatedly over and over again to be successful with. But it failed every time. They are going to shut the government down and in doing so really wreak havoc with our economy. And i really fear even more whats going to happen on a few weeks time when the debt limit issue comes forward. Is the issue they are going to shut the government down . Or is this part of a campaign so they can go back certain people can go back to their constituents and say you know what, we almost went there. Almost went there. Whatever you think that means if you think it means anything. And they actually dont shut us down. Well, we certainly hope its that version of it, andrew. One cant know for sure and well have to see over the course of the day and if, unfortunately, the midnight passes over the next days what their intention is. But certainly the rhetoric coming from the House Republicans and senator cruz and others is that if they cant get their way on this issue, theyve been trying repeatedly to prevail on but without success, they are willing to shut the government down. And that seems to me to be a crazy thing. It really is itd be a horrible thing for our economy just as we are starting to build an economic recovery. Itll be a horrible thing for the country. Neal, play out what happens in terms of who has the power, if you will when it comes to the debt ceiling debate. Thats what comes up next. Well, you know, congress authority is very clear constitutionally is to extend the debt limit. Thats their authority. Congress decided again, republicans in the house and some in the senate have said we are going to hold that hostage too and that would be, you know, the shutdown of the government would be a problem for the economy but a breach of the governments debt, a default of the governments obligations would be catastrophic. You know, is there any room for compromise . When it comes to this issue about the tax on medical devices some people dont want to talk about it in this context. If that part of the bill was defunded, what happens . Hes willing to talk about a lot of these issues, not a hostage situation. But what the republicans have said repeatedly, they want to get rid of the whole bill. I add one thing, ironically when they stop obama care, thats going to create a bigger gap in the governments finances. More deficit, which, you know, theyre talking out of both sides of their mouth because, of course, they also seem to say they want to decrease the deficit over time. But some of this also, we have to accept some responsibility, cable television, the internet, because 50 years ago, these things would be debated in the halls of congress. Now theyre debated on cable tv and on twitter. And there is a lot of posturing and positioning and trying to play to the base and politics has become more isolated with the fringes having more power and the center being weakened. I think we need to figure out ways to get people in rooms working together, create some compromise. The Health Care Bills not going to be repealed, obviously. There are some things like the medical device aspect that needs to be it is broad legislation. Of course some things need to get fixed. I think its time to put that in play. Some aspects, the marketplace to get the kind of insurance. Makes sense. Doing the same idea. So that aspect makes sense. But i think its time to move on and not just be focusing on the headlines and the posturing but the governing. You know, good policy, not just good politics. Neal, what, though, is the trick to, woing if youre on the democratic side to working with ted cruz. Is that possible in this day in age. Is there something that could be done thats not being done. Well, you know, i think what the democrats have said and what the president has said, were willing to talk. But to talk in the midst of kind of a hostagetaking situation is a difficult place to start the conversation. And there have been plenty of weeks and months in the past, and therell be plenty of opportunities in the weeks and months to come to talk about whether or not there should be adjustments to the Affordable Care act, how we should think in the near term and longer term. So, look, congress ought to be doing things that reinforce a recovery, spending money on infrastructure which until very recently was a bipartisan thing. Everyone agreed in congress that we ought to have infrastructure that helps support Business Growth and our economy. And somehow that has disintegra disintegrated. Theres plenty of opportunity to talk. But it takes two to talk in a constructive fashion. Neal, when you look at what a grade bernanke and the fed now given what looks like is happening, do you say that the decision to not taper, the no taper taper was the right one recognizing we were going to get into the soup with the debt ceiling. I dont think im going to talk about monetary policy, but i certainly agree with the idea that everyone has the capacity to help get this economy moving forward in the right direction ought to be doing everything they can to do just that. Right. Okay. Neal, were going to leave it there, thank you so much for your perspective this morning. Great to be here. Coming up, were going to talk about tim cooks big lunch date today. You know who that is with . Well, id love to, but im here with you instead. Also, were going to talk about the Government Shutdown and how it will affect you. And if it does, take a look at futures. The dow looking like it would open up about 105 points. Were coming back in a moment. Time for todays aflac trivia question. What does walt jr. Claim veggie bacon smells like in the First Episode . Yo, yo, yo. Aflac. Wow. [ under his breath ] that was horrible. Pays you cash when youre sick or hurt . [ japanese accent ] aflac. Love it. [ under his breath ] hate it. Helps you focus on getting back to normal . [ as a Southern Belle ] aflac. [ as a cowboy ] aflac. [ sassily ] aflac. Uh huh. [ under his breath ] i am so fired. Youre on in 5, duck. [ male announcer ] when youre sick or hurt, aflac pays you cash. Find out more at aflac. Com. The ocean gets warmer. When youre sick or hurt, aflac pays you cash. The peruvian anchovy harvest suffers. It raises the price of fishmeal, cattle feed and beef. Bny mellon turns insights like these into powerful investment strategies. For a university endowment. It funds a marine biologist. Who studies the peruvian anchovy. Invested in the world. Bny mellon. What does walt jr. Claim that veggie bacon smells like in the First Episode . The answer, bandaids. How would you know the taste of bandaids . Everybody knows the taste of bandaids. Can we say the ending was awesome . It was authentic, exactly what you want. Who were you talking to . Did you see it . Lets take a quick look at the futures. This morning, falling under the weight of a pending Government Shutdown. The dow would open off about 101 points. Peyton manning was awesome. And the redskins. Theres a lot of bad things in washington right now, but the redskins won a game. Some of us keeping my eyes on gray matter technologies. How about georgia . Did you watch georgia . I was focused solely on the stock price of gray matter technologies yesterday. Thats all i could think about. Georgia. Georgia. Georgia. Okay. In the headlines this morning, the senate expected to reject the bill passed by the house over the weekend. That wouldve kept the government running but would have delayed the Health Care Reform law for a year. Were going to have a lot more coming up on that issue. Also, Dallas Mavericks owner cuban headed to federal court in dallas today battling Insider Trading charges. And hes expected to testify in his own defense. Hes accused of avoiding losses in internet Search Company mama. Com. Remember mama. Com . And by allegedly selling ahead of stock option. Reiters had a poll. 26 said they were likely to buy the ps4 when it becomes available versus just 15 for the xbox. Also, it was no contest at the Movie Box Office this weekend. Cloudy with a chance of meatballs 2 topping the rankings with north american ticket sales of 35 million. Last weeks winner, Hugh Jackmans prisoner finished a distant second only racking up 11. 3 million. For some forecasters, though, they thought cloudy would sell up to 45 million in tickets. Although the producer forecast 30 million to 35 million and that its pleased with the first weekend performance. A lot of good movies coming up. New tom hanks movie i want to see. Another movie with the guy from breaking bad in it also with brad pitt and others called the counselor. Which guy . Hank. Hanks in it. A mega power lunch. What if youre the ceo of one of the worlds most iconic brands, he comes aknocking. Well, today, apples tim cook is breaking bread and breaking bad with carl icahn. A Good Management move or a case of keep your friends close and your enemies closer . Weve got all that when we return. Twins. I didnt see them coming. I have obligations. Cute obligations, but obligations. I need to rethink the core of my portfolio. What i really need is sleep. Introducing the ishares core, Building Blocks for the heart of your portfolio. Find out why 9 out of 10 large professional investors choose ishares for their etfs. Ishares by blackrock. Call 1800ishares for a prospectus which includes investment objectives, risks, charges and expenses. Read and consider it carefully before investing. Risk includes possible loss of principal. Farmers presents fifteen seconds of smart. So you want to drive more safely . Stop eating. Take deep breaths. Avoid bad weather. [ whispers ] get eight hours. [ shouts over music ] turn it down and, of course, talk to farmers. Hi. Hi. We are farmers bum pa dum, bum bum bum bum welcome back to squawk box. Tim cook has a lunch date with carl icahn to discuss apples next move. Lets delve deeper into the role of management when dealing with highpowered activists. Joining us to talk about it, associate dean for executive programs at the yale school of management. I want to get steve case involved in this conversation, as well. Jeff, if you are tim cook, is this the right do you have lunch with carl icahn . Does that make sense to you . Andrew, thanks a lot. I i think it is a case, as you mentioned going into the break of keeping your friends close perhaps your enemies closer. It cost him very little to learn what is on icahns mind. Steve jobs probably wouldnt have had this meeting. Talk about keeping your friends closer, you want to bring steve case into things. You have the right guy on the set today. The only mistake about having steve case there today, he should be in washington. If you saw the cover story on steve last month in business week, they talked about the one guy who can bring all of washington together. He literally goes from the chairman of the house caucus to Nancy Pelosis offices pretty effortlessly. They say hes the one Business Leader that talk to all sides. We wish you were in washington instead of on the set. Ill be there tonight and the rest of the week. We saw you in action last week with our ceo caucus. You were there with all of these senators. If youre tim, though, and sitting across from icahn at lunch, what do you tell him . Well, you know, if you go back a couple of years and you think about what happened when the then ceo of motorola innocently went off to the upper floor of the gm building thinking he was going to have a friendly meeting, started as a friendly meeting and got nasty afterwards and led to the breakup of motorola. We dont have that situation here at apple, but if youre looking at 150 billion of cash, you think, well, clearly maybe icahns going to get some credit for more buybacks. Theyve been doing buybacks through much of the last year. Now this is offshore. He cant use 100 billion of that money for dividends or for buybacks. Theres a speculation, andrew, he wants to unload nuance. Steve, different question. Steve jobs, the other steve. Steve jobs would never have this meeting. In a million years. Well, thats correct, but he was not on earnings calls. He felt his job appropriately was to focus on the product design, focus on recruiting talent and left it to others to deal with managing the investors. Most ceos do engage with particularly their large investors. They do participate in earnings calls, do take calls or meetings with their large investors like, you know, tim is doing with carl today. How do you handicap this . Carls a volatile guy. This can go in many different directions. You can win on one side and almost do a richard parsons. I know well, carl called me when right. That was a big bear hug, right . A big bear hug on both sides. And carl was revving up the engines, putting pressure on the time warner board. Id left by then to take more aggressive action, break up the company and there was a little bit of a charm offensive. And as a result, carl backed off. I think thats what tims going to do, listen and coop. Do you think carl loves the fact he can tweet out hes having lunch with tim . Sure. Is there an element if youre tim cook just engage, engage, engage because thatll keep carl happy . To an extent. Ultimately he wont engage a lot, hell be respectful, but at the same time, make it clear to carl and other investors hes taking a longterm view and apples the most valuable Technology Country in the world. And part of the issue, theyve done things so right, so much cash on the balance sheet, thats what the debate is. At some point, guys, the danger here is that carls not going to stay silent as we all know. Hes going to have an opinion after this meeting and every other meeting. Hes been a big cheerleader of apple recently calling it the biggest nobrainer hes had in a while. However, what happens when he starts issuing those public statements . Do they have to do what he says . We look at how stocks he took chairmanship roles in from blockbuster to wci, these things lost, 80 , 96 . Some of them went bankrupt with his voice. Tim running the company, the board needs to be listening and make sure youre respectful of all of the voices. Weve got to leave Jeff Michael Dell has led a brilliant privatization. And misstated what the credit situation was. Weve got to leave it there. Thank you for the conversation, well see what happens over this lunch because i imagine both will be tweeting about it when its over. Coming up, the prices are set and were one day away from new federally run Health Care Exchanges. Were going to speak to the co of one of the first exchanges to be granted a license after the break. And then at the top of the hour, dan gilbert, hes going to join us to talk housing, the consumer, much, much more. Squawk box coming right back. vo you are a business pro. Maestro of project management. Baron of the buildout. You need a permit. To be this awesome. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. aaron purrrfect. vo meeeow, business pro. Meeeow. Go national. Go like a pro. In a we believe outshining the competition tomorrow requires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. Down triple digits on the dow, 107 now with the s p indicated down about 12 1 2 points as far as where it would open. Panera bread is sliding in premarket trading, the restaurant chain shares were downgraded to equal weight from overweight at morgan stanley. The firm says panera may be losing the longterm ability to keep driving samestore sales higher. Carbs. And its called panera bread. What do you think will happen . Theres a lot of things that are different. Are you you still eat carbs, dont you . I love carbs. I just read a great article. Deep fried cinnabun is my favorite. Indiana state fair. Fried twinkies. Chipotle. I do love mexican food is great in my view. They dont do it as a burrito. If you do it as a salad what was the rating on chipotle . Upgraded to overweight from equal weight. Its great, entrepreneurial success story. You think you get underweight or overweight . Tminus one day until Health Care Exchanges open for business. Will they get off to a start without a hitch . Joining us now the president and ceo of north shore health systems. Youll be part of the exchange for new york. Yes, we will. We started our own insurance company, we will be on the exchange tomorrow. The series of articles in papers recently have talked about glitches that are likely and may be part of any launch that is as big as this. Are the glitches, do you think, higher than what would be expected . Because theres not enough time . Or about what should be expected . Well, i think we think we know what is supposed to happen beginning tomorrow. But quite frankly, im not exactly sure that we know what will happen tomorrow. I dont think the preparation was as comprehensive as it should have been. There were, many, many technical problems. Parts of the reform including parts of the exchange piece have been delayed. This is what happens when you have a major, major, major effort. And whatever happens tomorrow over the next couple of months, i dont think well know for the next six to nine months, the extent of which peoples behavior will dictate whether or not they go on the exchange. Both sides have painted themselves in a corner that may be counterproductive to their longterm interests. And by that i mean that it wouldnt have been the end of the world since the corporate mandate was delayed. It wouldnt have been the end of the world if the Obama Administration said lets give this a little more time, get all our ducks in a row. If you dont get enough young people to sign up. If they have a bad experience, the whole thing could collapse. Whereas the republicans, theyre taking this hard line, if they would just let it happen, the marketplace might have done the work for them. Instead, both people were painted into a corner that might be counterproductive to their longterm well, i think whats going to happen either way is that theres going to be major, major changes in this over time. Even if it works as well as the proponents would like it to work, there will be things that wont go correctly. This is what happens in any major, major event. There will be modifications. Thats the bestcase scenario. The worstcase scenario, the people you need to sign up have a bad experience and you dont get the 2. 7 million to sign up and then its not going to work. When you sign up, its going to take about 45 minutes to sign up. Youve got to fill out a form, eligibility form, get all the demographic information. And a question we dont know how peoples behaviors are going to change, we dont know what employers will do. We dont know what the healthy 27, 28, 29yearold will do. I think only time will tell. If you dont start, then you really wont know what whether or not these things will work out the way you want them to. This is sort of this obama care has become a political hot potato. Been talking for over a decade about getting consumers more involved in making decisions, marketplaces, exchanges would be a way to do that. This was an effort long before not only the president was he wasnt in the senate when the Health Care Industry was arguing essentially for this exchange provision and many people have done it for more than a decade. So some of this just, i think, the fear of the unknown, some confusion. It probably will take six or nine months. The private exchanges you see all of these Major Companies putting their retirees into now, they cant afford the defined benefit health care plan, its happening. We saw last year whether we can do it and the exchange aspect. What happened anyway . Well, it was beginning to happen. It wasnt happening fast enough. And as a result, they were going to the Emergency Rooms to get essentially care that was subsidized by hospitals like yours. I think consumerism is important. I think its important that the public gets opportunity to get information, see information as transparent, make decisions, have some skin in the game. People are going to be paying money out of pocket, make decisions and i completely agree, steve, that much of what was going on in the reform effort was going way, way before the Affordable Care act started. So it didnt its not like nothing was happening and all of a sudden the act passed and all new things began to happen. Reform efforts for the last ten years. And the way things got paid for in place. Going to take a while to move to more consumer driven. Its not going to happen overnight. But ultimately we have to shift from a sick care system to a health care system. Consumers got to use technology. Absolutely. Defined contribution. Not affordable by companies and not really flexible for consumers. The times or the journal over the weekend went to five or six different people and looked at their situations and some of the people 25 years old that even 150 a month or whatever it is, theyre totally healthy and theyre like, i might, but i dont know i might not. I might or might not. I was growing up in hawaii, you didnt have to have car insurance. And everybody, of course, didnt think they were the ones that would have an accident and get hit. But ultimately you need something as a society to make sure theres a foundation. If you didnt have the 150 a month. If you were never going to go out to dinner again, you might not want to pay that. Theres no perfect solution here. Every solution moves you down the road a little bit and you modify it and change it. My belief is you wont know for sure whats going to happen for a number of years. And by then, the legislation will have been modified. Things will be modified. And the reason we went into the exchange, the reason we started because i wanted to get in the business of promoting health and not just only be in the business of treating illness. And if i get the full premium dollar and my job is to take care of you and manage population health, then i have all of the incentive in the world to do the things for you in the right location, in the right place, so im not only getting paid to take care of you will you reach over there and hand me a donut . Yeah. Thank you for your time. Hopefully this makes him ineligible for your health plan. Thats another issue, behavior and lifestyle. Hey, hey im feeling good. Hes lost a lot of weight. Im on a third belt loop. Little things matter. These little blinking speed limit signs. Coming up disrupting the real estate world. You never had to does it end after youve expanded your business . After your companys gone public . And the capitals been invested . Or when your companys bought another . Is it over after youve given back . You never stop achieving. Thats why, at barclays, our ambition is to always realize yours. Okay, who helps you focus on your recovery . Yo, yo, yo. Aflac. Wow. [ under his breath ] that was horrible. Pays you cash when youre sick or hurt . [ japanese accent ] aflac. Love it. [ under his breath ] hate it. Helps you focus on getting back to normal . [ as a Southern Belle ] aflac. [ as a cowboy ] aflac. [ sassily ] aflac. Uh huh. [ under his breath ] i am so fired. Youre on in 5, duck. [ male announcer ] when youre sick or hurt, aflac pays you cash. Find out more at aflac. Com. Youve heard of shazaam for music, but theres now a similar app for real estate. Its called home snap. And guy will cot joins us to talk about it. Revolution ventures invest in home snap. And just give us the tensecond shazaamish version. A mobile app that lets you take a picture of any house in the country to find out about it. And i can find out how much it costs. Find out how much its worth. If its for sale, you can find out all about it or if it sold recently, you can see everything about it. See this is what we talked about. So we have what if its a track house in california. We have technology that can separate all the houses out. Even if theyre identical houses, were using more than the picture to figure it out. Using other sensors, as well. Gps. Its like a compass. What does that do . How does that help you . Figure out where your phone is aiming at the exact moment you take the picture and just before you take the picture. And youre getting the data from a zillow . No, we have all of our own data, were combining a bunch of different data bases and trying to make them smarter by talking to each other. Tax records, schools data, things like that. Heres a security question lets say its magic. Heres a serious security question. You know, if i can stand in front of any house and take a picture and be able to see a floor plan with the house and see pictures of the house, you know, if i have some bad intentions, that may not be good. This is all information you can find if youre looking for it in other places. Were making it convenient. Tax records, listing information. We dont have a light that says this persons home or not inside the app. If you search on google for an address, you can eventually find the information. They allow you to take the picture and find the information. If you saw a house you liked, take a picture, learn more about it. You might meet my dog if youre standing in front of my house and taking a picture. Can you tell shes in there . 120pound german shepherd. We make the money when people buy homes, we let people connect with an agent. When they buy a home, we share in that commission. Its part of the first mobile first real estate application. There were a lot of things about it that was web centric, this is mobile centric, which is where the market is most. Thank you very much. Congratulations, im going to try it now. The nation facing a Government Shutdown and bigtime debt issues. Th thats not stopping dan gilbert. Were going to talk to him about his plans, the debt ceiling and a lot more in a moment. At bny mellon, our business is investments. Moment. Managing them, moving them, making them work. We oversee 20 of the worlds financial assets. And that gives us scale and insight no one else has. Investment management combined with investment servicing. Bringing the power of investments to peoples lives. Invested in the world. Bny mellon. When we made our commitment to the gulf, bp had two big goals help the gulf recover and learn from what happened so we could be a better, safer energy company. I can tell you safety is at the heart of everything we do. 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The dead rising from the grave. Human sacrifice, dogs and cats living together, mass hysteria. And speaking of government in crisis, the city of detroit working through its bankruptcy. Hes a leader in the effort to revitalize the motor city. Plus, diana nyad swam for 53 hours, now shell tell us why shes going to swim for another 48 straight hours as the third hour of squawk box begins right now. Welcome back to squawk box here on cnbc, first in business worldwide. Im joe kernan along with andrew ross sorkin. Our guest host this morning is steve case. Mega bucks individual and chairman and ceo of revoluti revolution how many islands are there in hawaii total . Eight islands. You just own one, basically . I own parts of two. Okay. All right. Maybe if you want to quibble with the facts. Larry owns his own island, i own parts of parts of hawaii. It doesnt have a name does it . Island of maui we have some resort. His island doesnt have a name. Oh is that larry . I thought that was murdochs. He bought it from murdoch about a year ago. Going to be building a third hotel. Wed like to welcome you back to hawaii, though. Its hard to get there from here. Its hard to get there particularly if you have a morning show. Little challenging. Maybe you should move the whole show. If we did the whole show from there, it would be nighttime, right . Five or six hours depending on the time zone. Why dont you move it for a week . We would do it once. Thanks for the invitation, we appreciate it. When do you want to do that . In the winter, well be doing that. Does there anyone that doesnt know you founded aol . What else do i need to say about you . Revolution now. How many different investments . 25 investments. Revolution growth and revolution were closing a 200 million fund to invest in startups. That focuses on the earlier Stage Companies that needed 3 million, 5 million, 7 million. But both cases really trying to pick a handful of entrepreneurs with great ideas that we think with our capital but also trying to help them on brainstorming or partnerships or adding talent or creating visibility. We can take those Business Scale and how many acres do you own in hawaii . That arent being used effectively . Is it are we going somewhere . No, were not going anywhere. But you wouldnt if you didnt have a couple of acres, you wouldnt know. How many . I know where were going here. Im going to duck your question. Do you have hundreds of acres . We do. Maybe a bit more. Remember the decembscendent . I do. And all that land. I do. The rise of detroit. Were going to do the show from hawaii and i appreciate the invitation. The countdown to the Government Shutdown is on. Take a look at our countdown clock. Yesterday, the house passed a measure that would delay obama care for a year as part of a deal to keep the government running. The senate expected to kill that bill leaving both sides at a stalemate. If a new spending bill is not passed by midnight tonight, nonessential Government Agencies and programs will shut down. Well have a lot more on that story in a moment with hampton pearson. The viewers did not see that move from 57 to 56 minutes. In corporate news, we should note that twitter could be going public sooner than we thought. The social media titan reportedly planning to make the secret filing public. I want to talk to steve about this. Under u. S. Rules, that means by late october or early november. Its still unclear what twitters plans are for the offering. Some people expect they want to get it out there before thanksgiving. Lets get a quick check on the markets. Futures sharply lower this morning on fears of that Government Shutdown. The dow looking like it would open off about 115 points. Japans nikkei had the biggest drop in six weeks losing just over 2 and lets flip the board again because european stocks trading lower across the board. In italy, members of former Prime Minister berlusconis party pulling out of the Ruling Coalition sending the country into disarray. Its setting up the possibility of new elections, all of that sending the italian bond yield spiking this morning. And the countdown to the shutdown is on. Congress has less than 16 hours to come up with a spending bill to keep the government running. Hampton pearson joins us now with more on what happens if lawmakers do fail to reach a compromise. Good morning, hampton. Good morning, andrew. Not everything comes to a halt right away. But starting at midnight tonight, hundreds of thousands of workers will be placed on leave. Well see museums like the smithsonian here in washington, National Parks and landmarks like the statue of liberty and the Lincoln Memorial being closed. However Social Security and medicare benefits will continue to be paid. Some 1. 4 million active personnel will remain on active duty but their paychecks could be delayed. Half the civilian employees, as many as 800,000 people could, in fact, be furloughed. Air traffic controllers, tsa screeners at airports will remain on the job along with most of those involved with federal Law Enforcement and Homeland Security all considered essential services and personnel. Now, its the Government Data collection and reporting considered nonessential that Financial Markets will be watching this week. At the top of the list, the jobs report due out on friday from the bureau of labor statistics. There is a possibility it will be postponed. A postponement on the bls website says if a shutdown occurs, quote, all survey and other Program Operations will cease and the public website will not be updated. A lot of that depends on, for instance, if the september jobs report has already been prepared and it would be up, basically to the office of management budget to green light any contingency plans for releasing that report. Now, that did happen back in 1995, 17 years ago, the shutdown there. This was a concern about a cpi report getting leaked. The commerce department, however, has already said therell be no data releases this time around if were shut down. Construction and factory order data are due out later this week. So here we are. The countdown continues, joe, back over to you. All right, hampton. And we have a clock and we you dont need to look any further than that. We know exactly how long its going to be. We should look. What does it say, andrew . 15 hours, 52 minutes and just 27 seconds left, 26 now, 25 now. Itll continue going down that rate. This is so exciting this Live Television thing. This is what we do. This is like watching the apollo landing. We had a camera on madoffs bathroom window. Swear to god. Which is why you guys are such leaders. And when the light would go on at 3 00 a. M. , we would be there and also at 3 30 and 4 00 and youre worried about the home snap. Were killing it here. Our guest host our next guest in the leader of an effort to revitalize the city of detroit. This morning, breaking ground on a startup neighborhood in the motor city. And joining us now, dan gilbert, founder and chairman of quicken loans. Founder and chairman of the detroit based rock ventures. And you should have bought the lions not the not some of these other. Did you see that . Yeah, theyre looking pretty good. 31, tigers going to the playoffs, Cleveland Indians going to the playoffs. The browns are 22. Im excited. Cavalier season is starting. Lake erie is great place to be right now. It is. I think that might be a metaphor, dan. I dont know, i hope so. I dont know. Its an exciting time, joe, how are you . Im good. Well see you tomorrow night with one game playoff with the didnt look too strong over the pirates over the weekend. Anyway, dan, how are the other effort whats happening in terms of detroit right now . Well, detroits going through the bankruptcy process as you know. You know, i think that the emergency financial manager put it the right way a few months ago when he said, look, detroit was already bankrupt. The bankruptcys sort of the legal formality. I think getting through this is going to be good news. And the city itself, i mean, downtown right now is hitting levels it hasnt seen in decades. A new startup neighborhood called the madison block which is really an extension of a building where there are about 25 startups in and google came in last week and announced their neighborhood really. And worked with us and we created this madison block now which is moving a lot of these Companies Growing out of that building and theres a lot of action here. Obviously as you know the Automobile Companies are doing well. And hopefully now with the federal government coming in on friday making some announcements about working in the neighborhoods and working on blight. I think things are starting to turn here in motor city and looking up. I was in detroit recently and Startup Energy is terrific. I think its worth taking a step back and remembering in the 1950s, detroit was silicon valley. It was one of the most Exciting Technology when the car was the hot thing. Silicon valley in the 1950s was nothing, it was just pastureland and detroit rose on that and then fell when detroit kind of lost its way, lost the entrepreneurial mojo. The Car Companies are getting it stabilized. Whats going to lead to the rise again, i think, of detroit, the work of dan and others in detroit backing up the startup scene. That is core to sustaining these economies. Hey, dan, quick question. No question, steve. The start the Automobile Companies, back early part of last century, they were the startup businesses and there were hundreds of them until there was a lot of consolidation among them and you had General Motors and ford and chrysler. Psalm thing here, the good news is in a technology era, you dont need seven years of runway to build an automobile plant and you dont need 250 million or 500 million whatever it would cost to build one, things can happen quickly as you know well better than anybody. Not to be a downer, but given the potential for a Government Shutdown, what would that mean to the Housing Market considering new federally backed Mortgage Applications wouldnt get processed. How do you see that . Well, you know, were sort of watching the situation real close over here. We havent heard exactly what fha is going to do, fannie and freddie. Were processing loans as normal as usual. I guess if it happens, you know, i dont know if they know whats going to happen with those agencies at this point. So were watching it closely. And until that clock hits zero, were business as usual. Every once in a while, dan, we hear the government needs to bail out some aspect of detroit whether its pensions or something. Theres times when i think maybe just some Public Private Partnership Might be in order and then theres other times i think if you can do this purely the way youre doing it, it might be more long lasting and just set a better example for everything. Do you still want some type of federal assistance now . Well, you know, a lot of people will make the comparison with new york in the 1970s where the federal government did bail out the city prior to the bankruptcy. You know, now that detroits in bankruptcy, you know, and politically i just dont think its feasible, i think i tend to believe in free markets and working your way out like you do. Theres always a place for government to do things. The Obama Administration came to detroit on friday. We had four secretaries of the cabinet come in, they made announcements and taking existing federal dollars from different areas and basically pushed those towards the neighborhoods. Thats the key here. Downtown is starting to do better as is midtown. The neighborhoods are the ones that need help. We need to take down all the blight in detroit and i think, you know, as appropriate where they can to move some dollars around and help detroit. So, you know, we can forget about any bailout thats not happening. But if you can direct some of these dollars and we can get through the bankruptcy, which i think we will in the short period of time, i think things are going to be really looking up. The government could play a certain role in stabilizing things. But what dan and others are doing in terms of driving the startup scene is hope couldnt you get rid of the buildings by having people, you know, own the actual equity that theyre located on. There must be a way to do that private sector wise. Then people could do it to make money eventually. What were talking about are buildings that have no hope and Something Like 70,000ish plus nobody knows the exact number. I was appointed on a committee to be a cochair with two others. And were working on this thing with a whole bunch of other people here. The city, the state, as well as the federal government, the Business Community, the foundations. I mean, ive never seen this area so focused together and working hand in hand. All these sectors working together to really, really finally make major moves. As you know, things like this dont happen overnight. Happened years and decades of bad decision making. And finally, the backs to the wall here and great things are coming out of it and starting to come out of it. Were seeing the rise of the rest where entrepreneurship is happening across the country. More of the venture firms will have different strategies instead of focusing on silicon city. Its easier and cheaper to start companies. You can start them detroit or des moines or what have you. It needs the energy and leadership of people like what dans providing in detroit. I think thats right, steve, you see all kinds of venture guys now coming down to detroit. Were touring a couple a week throughout the whole downtown area. I think thats right. Wealth is created as you all know. And creating Entrepreneurial Companies and jobs and the excitement and most importantly, actually, for us here is to keep the talented graduates of Michigan State and wayne state and eastern and western and all together down in the motor city versus leaving the state. Thats number one. And a lot of people get these educations, go to silicon valley, new york, because they think thats the only place to get a job and see their home or where they grew up moving, theres energy and excitement, they want to move back. Thats starting to happen in detroit and other parts of the trend. Its a big trend to watch over the next decade. Entrepreneurship moving broadly across the country. Not just being limited to silicon valley. We only could fit 1,157 colleges. Theres no question this generation wanted to impact the outcome. Here in detroit, they can now get a job in technology and start of businesses and also impact the outcome positively with the city itself. And thats exciting to people. The whole idea people want to go to detroit, not because its easy, but because its hard. Making it more of a startup city once again. Real quick, dan, there was a very cynical piece in the New York Times, do you know the company that makes watches . Sure do. They were on the show. Theyre trying to take advantage at some level of the detroit brand. And manufacturing here. And manufacturing here. And the times writes not much different than buying a fair trade, you know, sweater. Youre buying a small piece of the revival of the American Manufacturing city going dead. Do you buy that . Do you think thats fair . No, i think thats silly. And, actually, im wearing i know the watch coincidentally. But, yeah, its made in detroit. These are guys that came from texas, they didnt ask for a penny. Came into the city because they like the way, you know, the made in detroit sounds and tests in their marketing. And also because of the work ethic in detroit. Theyre doing well. I think theyre hitting the cover off the ball. In fact, theyre making watches and bikes, its very exciting for us to see here. When the New York Times called it a liberal idea. Youre certain they were using that in a negative . The way it was being projected. Are you absolutely sure . Im pretty confident. Im telling you what it said. Liberal idea was a bad idea. I was thinking this is a seinfeld episode. I was buying myself a watch i hope you would. Well, apparently i would be a liberal trying to support detroit. Clint eastwood did not do such a great job at the Republican National convention. But he did a great job a couple years ago talking about it being halftime in america again. Your colors are detroit was fighting its way back. Your colors all of us cheering for dan and others. Your colors are showing again. Not everyone thought clint did a bad job. Well, actually, most no, no, no the romney camp did. Maybe so, but speak for yourself. Well, i thought so. Speak for yourself. Anyway i am speaking for myself. Thats for sure. Thank you, dan gilbert. Coming up next, the countdown to the Government Shutdown is on. Congress is less than 16 hours now to agree on a temporary spending bill. Im going to be looking at my shinola watch to figure out how much time is left. Or Government Agencies will shout down for the first time in 17 years. Up next, well talk to John Barrasso about a possibility of a compromise deal. The most Free Research reports, customizable charts, powerful screening tools, and guaranteed 1second trades. And at the center of it all is a surprisingly low price just 7. 95. In fact, fidelity gives you lower trade commissions than schwab, td ameritrade, and etrade. Im monica santiago of fidelity investments, and low fees and commissions are another reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Welcome back to squawk box this morning. Take a look at futures right now. We do have red arrows ahead of what could be a Government Shutdown. We do not know if a compromise will be reached. The dow looks like it would open off about 114 points, s p 500 off about 13 points. We should note this morning that gamestop the latest retailer is weighing in on the Holiday Hiring season. Planning to hire about 17,000 workers as the company gets set for the launch of the sony ps4 and Microsofts Xbox 1. Thats a good way to start. No, no, this is an important point. Thats amazing. They temporary workers become fulltime jobs. And in this day in age, you hear about u. P. S. , 40 of the Senior Management started on the trucks. And i cant tell you how many people i meet who want to be interns and refuse to get coffee because they have to do the that was the Ashton Kutcher speech where he said i never quit one job without having another and there was no job he wouldnt take. Yeah. We had a little bit of other news. For the first time in 13 years, cocacola has been unseated as the most valuable global brand. You want to guess what it is . Squawk box. The new number one is apple. Of course. Ranking, taking into account for financial performance, the ability to influence Consumer Choice and the ability to command a premium price. Google taking the number two slot to three rounding out the top five ibm and microsoft. Do you buy that . No. Wheres comcast . Right. Coming up nbc and cnbc coming up i cant be myself. Do you have a little picture of brian roberts, you look at it next to your bed . Look at his screen right now, his screen saver. Brian, steve, ive got them all. Okay. Coming up, well continue our conversation of about the possible Government Shutdown. Dont leave anybody out. Im scared, who did i not say . Oklahoma governor hell be the guest, i mean, and former california congressman vic fazio. Bny mellon combines Investment Management investment servicing, giving us unique insights which help us attract the industrys brightest minds who create powerful strategies for a countrys investments which are used to build new schools to build more bright minds. Invested in the world. Bny mellon. Transit fares as in the 37 billion transit fares we help collect each year. No . Oh, right. Youre thinking of the 1. 6 million daily Customer Care interactions xerox handles. Or the 900 million Health Insurance claims we process. So, its no surprise to you that companies depend on todays xerox for services that simplify how work gets done. Which is. Pretty much what weve always stood for. With xerox, youre ready for real business. We are less than 16 hours away from the Government Shutdown barring a temporary spending bill. The house pass add proposal early sunday morning that included a oneyear delay for obama care which is expected to be rejected by the senate. Joining us now, John Barrasso, a former orthopedic surgeon. Good morning. Its great to see you. Thanks, joe. You think it should be delayed for a year for a lot of reasons. From what i can tell, you dont think this is the way the republicans should be going about accomplishing that . Well, republicans are united against thiS Health Care law which is bad for patients, its bad for the providers, nurses and doctors who take care of them. And its terrible for patient and for taxpayers. What i am saying is i dont think we should shut down the government, which is why i believe what the house did was a reasonable and responsible approach. Fund the government, keep the government open at the same time limit this tax that hurts businesses and hurts jobs and delay for a year the entire Health Care Laws. One of your previous guests who was involved in one of the exchanges says they really havent tested it out and its not ready to go fully. Senator, i even made the point that both sides have backed themselves into a corner where it might be in the president s best i mean, it might make sense to go a year delay. He wont do it and especially when youre trying to force him to do it, itll never happen. Its a nonstarter, hes unwilling to do what might help this bill and the republicans, it might be in their best interest to let this start where it doesnt work very well because it needs to be fixed and it collapses on its own. It seems like both sides are staking out positions that could end up being counterproductive for what either side wants. Well, for families all around the country who are looking at this individual mandate that goes into effect now starting january 1st so they have to start buying government approved insurance or pay a penalty or a tax or a fine, theyre saying why is it okay for the president to give businesses an exemption but not give the workers. Why should the boss have an exemption but workers not be exempt from the mandate for at least the delay of a year. The president s granted exemptions for members of congress. Hes kind of changed the law without changing the law by saying the different subsidies that with have received from the exchanges, he changed it to the honor system. By the law, people were supposed to have to actually verify their income. So the president s done a lot to change the law in ways that i think arent really legal to do. So i think its reasonable for republicans to say lets delay the individual mandate for at least a year. Yeah, its reasonable to say that. But you know when you tie that to a Government Shutdown that the president s not going to go along with it and harry reid and the democrats are not going to go along with it. You know, both sides are entrenched in these positions that are not workable and the government could get shut down because of it. Well, it seems that harry reid and the president seem to be eager for a shutdown. We were here and shouldve voted yesterday on what the house proposed which i thought was a reasonable proposal, a responsible thing to offer. But yet senator reid said no, were not going to come in until monday afternoon at 2 00. You know, i think that was irresponsible. Senator we should have been here working fully. Most people dont think its going to last that long. How about doing it in other ways . Lets say in the next 24, 48 hours, we reopen the government or dont close it down. Then start whens the next pivot point for trying to get a delay of a year . Its starting on tuesday. Were going to see whether and we should get some indications early on about how many young people are signing up for it. You might have some leverage if its not going well for the next pivot point whether its the debt ceiling or, you know, whatever. Well, a couple of things. One is that im hoping that five democrats vote with the republicans today in the senate to adopt a reasonable and responsible house position and keep the government open. If that doesnt happen, as you say, there are additional leverages down the line with e the with the debt ceiling because i will predict to you today that before january 1st, we will see a delay of the individual mandate to provide fairness to middle class working families all across this country so they have the same delay that businesses have been getting. So senator, when you came to washington, do you expect this kind of constant political squabbling. It just feels like the discussions that used to happen, decades ago. Now people go on cable shows or go on twitter and put out press releases. How do we get back to actually focusing focusing on policy and not just have it all about politics. It must be frustrating for you to dedicate your life to this and be caught up in the system thats sort of stuck and the American People are frustrated. Ive been a doctor for 25 years taking care of patients all around wyoming. Im used to solving problems for people with medical problems like i came to washington with a hope of focusing on getting down the cost of care for people, for providing patientcentered care. And yet, instead of Health Care Law was passed, forced through congress, forced down the throats of the American People. Which is not what the American People were asking for. They we needed Health Care Reform because of the cost of care. People wanted to have Affordable Care, quality care, and now with thiS Health Care law, so many people will tell you they think theyre going to end up paying more for their care, less quality, and thats why when the exchanges open tomorrow, i say its buyer beware. The president promised last week in his speech that youd be able to find quality Affordable Care for less than the average cell phone bill, which is 71 a month, i will tell you theres going to be sticker shock tomorrow even with the subsid s subsidies. Young people, and you talk specifically about young people signing up. Theyre going to find it much more expensive after the exchanges are open to buy Health Insurance than it was before the exchanges existed. All right, senator. Appreciate your time. Appearing with us on cable today. Youre appearing on cable today with us and youre probably tweeting and doing all the things im not in congress. I know youre not he needs to be on cable talking about this to the public, to the American People. Arguing is fine, actions is better. Cut the deal. Lets get on with it. Its time to see less politics and more policy. The country has problems. People are frustrated. Get some work done. You said things about cable tv. Internet, my friend. I had some role in getting america online. Sometimes you have to stop talking and start acting and do more listening. The reason we have two ears and one mouth, remember that in washington. Coming up, much more on the prospect of a Government Shutdown. Up next, well talk to a former oklahoma governor Frank Keating and vic fazio. [ bell ringing, applause ] five tech stocks with more than a 10 . Change in aftermarket trading. All the tech stocks with a market cap. Of at least 50 billion. Are up on the day. 12 lowvolume stocks. Breaking into 52week highs. Six upcoming earnings plays. That recently gapped up. [ male announcer ] now the world is your trading floor. Get realtime market scanning wherever you are with the mobile trader app. From td ameritrade. With the mobile trader app. In a we believe outshining the competition tomorrow requires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. Welcome back to squawk box. Congress has less than 16 hours now to come up with a spending bill to keep the government running. Joining us now with more on the Government Shutdown. Frank keating, the president and ceo of the american bankers association. Also with us, former u. S. Congressman vic fazio. Good morning to both of you. Good morning. So i dont know where to go with except to say is there any chance we actually get a compromise . And thyme going to go to you, frank, first. Well, obviously i hope so. Because, you know, this isnt red country or blue country. Its the United States. This is humiliating. The chinese are laughing at it. And things, andrew, need to be in perspective. In the year 2020, just servicing the National Debt will be 1 trillion a year. By the year 2025, every cent of federal tax revenue will go to medicare, medicaid, Social Security and interest on the debt. None of this is sustainable. Whether its a temporary shutdown and okay, well have a good laugh against the republicans or if the debt ceiling is toyed with, the sovereign integrity of the United States, the embarrassment to the president and chief of state and head of government will be very real and very painful. We got to fix it. Frank, in your current role, i assume you have conversations with people like ted cruz. How far do you get . Well, you have to understand, the team party and not incorrectly came to washington seeing this place is unstable. The country is out of control. It took 1789, George Washington to the start of george w. Bushs presidency to get to 5 trillion of National Debt. George w. Went from 5 trillion to just about 10 trillion. Now were at 17 trillion. We have to raise the capped another 1. 1 trillion, it is unsustainable. So the tea party came intent on trying to do something about this dangerous debt and all were doing is playing politics. Youve got to sit down, the president has to bring everybody together and fix it. Because it is not sustainable. How do you reach a compromise at this point in an uncompromisable situation . Well, i think we have a hard core group of republicans in the house, probably 25 of them. Who are leading another 75 in this box canyon that they keep putting their leadership in. If boehner had the support of his caucus, i dont think wed be shutting the government down today, i dont think wed be toying with the debt limit. These are terrible, destructive things that will be hurting the economy, slow growth and frankly in the long run add to the deficit. Were going to be paying more interest on National Debt and individuals wed be paying more interest on their own personal debt simply because the full faith and credit of the United States is being threatened. Is this a steady march towards not only no compromise today but less compromise in washington period . Or do you think this will become an historical anomaly . Well, i think were at a point where people are so polarized and the members of congress dont know each other, they dont like and respect each other. They come from the oneparty districts where compromise is a dirty word. I think we have a number of republicans who fear primaries far more than reelection. And so they come to town and adhere to the tea party mantra even if they dont personally agree with it because they fear the consequences. This has made it extremely difficult to negotiate across party lines. I agree with frank, we need a deal. Is congress more polarized than ever, are the people of this country more polarized than ever . Yeah. And i i think that vic would agree with me. I think a lot of people are very alarmed at the state of the Fiscal Health of the United States. And it is going right over the cliff in a few short years if we dont do something about it. And i think a lot of people dont realize as legislators and as a governor of a state with a democrat house and senate, the only way i got anything done whether it was ride to work or tax cuts or getting rid of welfare was bringing anybody together and saying, look, the kids dont take hard enough courses in schools, we need to work on this. And independent analysis of where that was so. The president needs to bring everybody together, close the door and say, look, we are not going to become a laughing stock. Weve got to resolve these problems and work together. Takes leadership. Real quick, i want you both to handicap, ten seconds each. What happens next week when we get to the debt issue . Oh, my. Take a valium. Gong back to your question, andrew, i think the country is very polarized, but the districts now as you heard from the congressman are hyper polarized. People are worried about a primary challenge and a lot of things. Is that because of gerrymandering . Thats a key problem. Iowa more recently, california, have taken some steps. Do we blame both parties for that . Absolutely. When they have a chance, they draw the districts to protect their incumbents and no incentive to come to the center on both sides. Its to make sure youre covering your flank and nobody primaries you from the right or the left. First, we need to make sure the government doesnt shut down and get the budget on the right path and fix immigration but theres longer term issues around making sure we get the governance right and t got to be reforms like redistricting. Thank you, guys. Appreciate it. Lets hope we dont go over, but well see. A and coming up, she swam for 53 hours to become the first person to swim from cuba to the United States without a shark cage. Diana nyad the former cnbc host. Will join us next. Her next feat swimming for 48 hours to benefit the victims of Hurricane Sandy. [ female announcer ] youre the boss of your life. In charge of long weekends and longer retirements. Ask your financial professional how lincoln financial can help you take charge of your future. How lincoln financial can help you take charge of your future. Customer erin swenson ordebut they didnt fit. Line customers not happy, im not happy. Sales go down, im not happy. Merch comes back, im not happy. Use ups. They make returns easy. Unhappy customer becomes happy customer. Then, repeat customer. Easy returns, im happy. Repeat customers, im happy. Sales go up, im happy. I ordered another pair. Im happy. both im happy. Im happy. Happy. Happy. Happy. Happy. Happy happy. I love logistics. Now were live. Just about a month ago diana nyad made headlines by swimming from miami to cuba. Joining us now, were trying to get reacquainted before the camera came back on. Diana nyad, my old friend from the old cnbc building. We were colleagues and friends. I gave you university of cincinnati bear cats in 1992 to go to the final four and you had to come back and tell me, the others were were do you remember that conversation, diana . Joe joe, i remember you, the bear cats, thats a distant memory. Because i was right and gave you them before the tournament started and you had to come back and say, wow, i wish id listened. Steel trap. Yeah. Tears in my eyes, i guess. There you were and made everyone so proud and me, as well. And its great to have you on this morning. I was looking forward to it. Thank you. Now youre going to this should be. This is not even in the ocean, this 48 hours. But this should be like breaking sticks for you, no . You know, in some ways, you know, any time youre in a pool and fresh water and there are no jelly fish, sharks, tidal action, wave action, yeah, its easier. On the other hand, i take 48 hours pretty seriously. Youre going to go into some hallucination land and its going to take a moment of endurance to get through it. Its no joke, thats for sure. No, youre right. I swim, diana, i was never a great swimmer and now i do. I do a mile. So thats 64 32, and im in by probably 20 im almost hallucinating. I cannot the feat that you accomplish joe yeah, go ahead. Joe, since you have already declared this now to the entire audience, you better show up at that pool next week. I think you should do the first 48 minutes of the 48 hours with you. You want that sounds good. I accept. Live on cnbc. And this is for sandy how does it work, diana . Who thought of it . Yeah, its well, as you know, because you guys are right there, i thought of it. Im from new york, i saw Hurricane Sandy hit last year and you know what these natural disasters my god, in 30 seconds your home is gone. And, you know, your life changes and its a front page news. You guys are talking about it, especially the financial details of it. And then a week later, its off the pages, nobodys talking about it anymore. Well, those people, there are thousands of new yorkers, not to mention people from the jersey shore who are still homeless. I went to my sponsor, which is procter gamble, they stuck with me when i was failing cuba over and over again. What American Companies support somebody who is failing . And they just believed in me. Believed in being fearless and now their people that are already in the, you know, business of disaster relief, thats duracell batteries and tide that show up with the bank of washing machines at katrina at sandy and moore, oklahoma. They have gone in with me, underwritten the entire event. So this cool pool thats going to be installed for 48 hours is completely underwritten. Every dollar now thats going to go in, you know, through americares is going directly to sandy victims and helping a few of them get back on their feet. Its going to be something im very proud of. Its a nyad swim relief. Com where you can sign up and start getting involved. And joe, the speedo, it needs to come out next week with you at any time. Now were talking cnbc ratings. Joe in a speedo with diana. Were all very proud of you, diana, particularly proud that 25 years ago you were at cnbc and now youre doing great things setting world records, joe is still here at the desk. She said it we used to kid around about david faber in a speedo. I may do one of the borat yellow. You know, diana, how many people were on your team . I got a little p. O. ed, and i saw a guy currents. It made absolute sense. The current was moving at like five miles an hour. Didnt you have about 20 people that would have had to have been complicit. I dont know how you kept a straight face or didnt get mad. I think i would have walked out of the interviews. How many people were with you when you did it . There is your point right there. If we were going to go into a court of law, not only do we have all the gps, scientific, unchangeable navigator points that are electronically recorded and john bartlett, he is a math matt cal genius. They should vet an event. I would respectfully ask, can i see your navigation logs. That was fine. Another group of people for maybe the next 20 years will still be doubting and questioning and hating. I just cant pay them much attention. We have actually laid out everything transparently. This swim was clean as a whistle. Your point, it wasnt 20. We had 44 people who were watching this. As you say, some of them are brilliant scientists from the top jellyfish expert in the world. Dr. Angel yarsos harnega. Are you they going to col lewd 44 of them, and say, lets let her sleep on the boat and they want to be part of history. 100 clean. You got lucky. This time, you were great. We are similar ages. To do that, i feel like i can do anything now. Im not going to do that. Thank you. Thanks, diana. Great to see you again and catch up. Jim cramer gigs to jois goi us in a moment with his views on the Government Shutdown and much, much more. [ bagpipes and drums playing over ] [ music transitions to rock ] make it happen with the allnew fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Get 200 free trades when you open an account. The ocean gets warmer. The peruvian anchovy harvest suffers. It raises the price of fishmeal, cattle feed and beef. Bny mellon turns insights like these into powerful investment strategies. For a university endowment. It funds a marine biologist. Who studies the peruvian anchovy. Invested in the world. Bny mellon. Is welcome back to squawk. Lets get back to the new york stock exchange. Jim, are we still talking Government Shutdown . Any other issue you would like to address . I would like to ask tim case if he is thrilled with the job Tim Armstrong is doing at aol. Really turning it around. I think he is making great progress. I saw him over the weekend. Over half of internet traffic went through aol. He seems back on track. Great to see. Im glad you say that. I think it is the unhurled internet story. Yahoo is up so much. On the shutdown, what can i say . We know that bernanke knew what he was doing. People come on and try to game it. I just think that no one can. One of your guests earlier talked about taking a tranquilizer. That seems to be sound advice. Thats all . I just think the market is too high. I said on friday that the vics 15 is way too low. Because i dont know if it is going to be a week or two weeks, from a stocks point of view, we are too high. You dont buy on all this bad news. No, too early. It was too early in 2011. Too early in 2012. Too early in the sequester. Not that early in the 1995 1996 scenario, because the market went up. I dont think there was a group of people that think it was important to shut down the government. It was just people that couldnt agree. I think there is a hardcore group of people that really would like to see us default. Are you talking about the white house, jim . Im kidding. I know, i know. Coming up, our guest host is going to be steve case. You may get the last word unless i keep talking. Americans take care of business. They always have. They always will. Thats why you take charge of your future. Your retirement. Ameriprise advisors can help you like theyve helped millions of others. Listening, planning, working one on one. To help you retire your way. With confidence. Thats what Ameriprise Financial does. Thats what they can do with you. Ameriprise financial. More within reach. Thanks to our guest host, steve case. You know your last word has to be aloha. Lets come together in washington to get things done. We really need to deal with immigration reform. That and aloha. Thats a longer aloha. And mahalo make sure you join us tomorrow. Squawk on the street is next. Very nice. What a night of Television Last night as amcs breaking bad comes to an end. We promise not to spoil it for you z we are on