Transcripts For CNBC Squawk Box 20131213

Threeday losing streak in nearly four months. That index is down nearly 2 in the last three sessions, closing yesterday at 1775. The s p 500 is up about 27 yeartodate. We are going to talk more about the fed markets. Thats coming up at 8 30 eastern time. The Producer Price index for november will be released at 8 30 a. M. Eastern time. Congress are expecting a reading that shows an unchanged reading. Right now, take a look at the futures. At this point, dow futures are indicated up higher, up about 47 points. S p futures up by 7 points. Right now, lets get over to andrew with more of todays top corporate stories. Andrew. Weve got a lot of news for you, the first one being that directv is now exploring the idea of an online video service. The Company Plans to target what they call price sensitive young people. Other commerce have dropped their pay tv service. Directv and the nfl have agreed to a framework to renew the popular sunday ticket pass. Also, cocacola saying its going to split its north American Business into two operating units. This is part of the beverage giants brand to return to a franchise brand. Companies will be called cocacola north america and coca cola refreshments. You build it up, you destroy it, you build it up again. Finally, boeing planning to cut 1200 Research Jobs in washington state. Not good for the union movement. The move will reduce the companys reliance on engineers in the seattle area. Boeing currently considering proposals to move 777x Wing Development outside of the state to avoid union conflicts. Im not going to take this cord cutting crap watching internet stuff on some small screen. You dont have to watch it on a small screen. I dont care. Im doubling my big screen. Im doubling the size and the number and im getting xfinity on every one of them. Thats what im doing. This is ridiculous, cord cutting. You cant im going to. Because it doesnt exist. Theres bigger ones than 50 inches. You have a 45 inch one right now. I do. You dont have one thats only 45 inches, do you . 50. What is your biggest tv, joe . 50, i think. Im getting bigger and im doubling the number and im getting double xfinity. Double sequence xfinity on all of them. And a triple play for 99. Get the deal on that. And lets talk. What time is liesman on today . He has some all american thing going on, doesnt he . He does. He read his story last night. I read that story. But as many people when he went out, his neck is about this long on that taper thing. I know, i know. But you know who is telling him hes right . The market is telling him hes right. But if it turns out that it was right, what happened . Did the market listen to liesman or did the market already know and it was confirming that liesman right right . Its really moved. It did. As you said eloquently and with great feeling, lets not get you know, its 200 points. Were at 15, 7 on the dow. 15,739. Its down from 15,000. But when you look at these small daily moves, youre trying to interpret those, trimmers like that make a difference. But it doesnt mean the taper is going to all of a sudden kill everything. Although a lot of things have aligned, you know, now wire not worried about the budget any more. Now we are going to start tapering. So all these things that economic numbers have actually yeah, that, too. So these things, we were going up when infinity. We were going up when the xx opposite, as you like to say, we were going up as the exact opposite of these things were happening. Does it mean that theres a little bit of a breather here, mickey direction lerexler. What is the name of his suits . I made a suit called the ludlow suit. And the only thing low about the suit is the price, ludlow. No, very reasonable. I went with the old stand by when i went. The zegna. The zegna. Got me a zegna. Got me a zegma. Okay. United technologies is the stock were going to watch today. The dow component provided weaker than expected guidance for 2014. Profits as well as revenue. The company expecting a sales reduction from its Government Aerospace business. We got the impression from congressman ryan yesterday that some of the concerns from the right about the defense sequester had been ameal your ra emelurated to some extent. When the National News talks about boehner, they go think what you will. We all know you think hes a jerk because weve told you he is for the last five years. So we know you believe the Mainstream Media that he is a jerk. But in this case, i can hear it in their tone. That thats basically what theyve said. In this case, hes a little bit more palletble for us. You know what . Youre so good because you nail stuff. That is you know that im right with that. We live in new york, though. So were bombarded with and you are a product. I mean, you live, breathe, sleep, your heart is ticking, your lungs its all yeah. Anyway, inway washington oh, here we go. Did you see this . This is great. People were worried, 33294 for that bill, the bipartisan bill. And it really did kind of like some of the stuff boehner was saying yesterday. You know, he finally just said, look, ive tried to work, tried to take your position and not just dismiss them, but take them seriously. But try to further your goals and i agree with a lot of them, even though as paul ryan said, we have a democratic president and a democratic senate. But boehner said ive listened and ive tried to do it. But at this point, were going to do this. You loved it . You liked it. You liked it different as in stuff. Yeah. I think this was great. Nobody was expecting it to be quite this strong of a vote. Paul ryan didnt expect to see it. If you can get past some of this contentious stuff, build up relationships, people working across the aisles to see what we can get done instead of seeing what we can stop on both sides, there are some areas of agreement. If you can take those small areas of agreement and try and work on them, i think thats a great start. Was it true that 92 of the sequester remains . Thats what ryan kept saying. Do figures lie . I think if youre looking over the years, yeah. Is that how . Because everybody has a number that bolsters their you can look at this a lot of different ways. If youre looking at in this year, i dont know if how did we lose you . What are you looking at . Tell me. Its a story that becky is going to talk about. Youre is in the script preparing . No. I looked t screen and i wanted to be able to give you the exact answer about this because you would ask me before the program began. If what you told me is true, this takes out a large part of my daily pleasure. No, you can block people. Supposedly they dont get told if youre blocked. Lets find out whether its true. Twitter is backtracking after some changes to the sites blocking functionality. It was greeted with open revolt. Righting is reporting to the block function that users or interacting with their tweets. Allowing them to view or tweet. The people who are harassing still get the joy of harassing, still thinking that youre harassing. Twitter said the change is meant to protect users. It is back to the old world. Tell me in english, andrew. That means basically what they were worried about every time you block somebody, theres a potential for retaliation or that people will then write tweets about you but they wont use your hashtag or whatsoever. But i wont see them . You wont see them. So they thought, okay, the way were going to fix this is by letting people you can block them, i wont know that youve blocked me and ill keep writing these crazy things out there and ill feel like im completely empowered, except for the fact that youll never see it. But other people can see it, by the way. That was the issue. Because there are bitter, small minded haters. Some of them used to actually work here, hedge fund type that write stuff. I dont see it. I dont care at all. Im whistling past the graveyard constantly. Which you could still be doing, but they wouldnt know. I think the changes that theyve undone i dont think was necessarily a bad thing. Because you provoke someone when you block them . You do . Yes. Thats the whole point. When you block them, it will stay block. I do double secret blocking. I also report it at spam. Do they know that i report them as spam . And i mean both kinds of spam. Youre a scary preservative laden how do you think people feel but . Who . Hormel, the spam people. I think they like me, but they worry about me. Because the lovers of spam, we probably dont have a lot of them in our audience, do we . Have you ever had it . I cant say ive ever had it. I dont think ive ever had it. I dont think so. I like hormel products. I just think spam is funny. I think the name is funny. I think its a meat and if its a meat, it should be called whatever type of meat it is but no one knows. The next time we have the ceo of hormel on, we should ask him about how spam has been used in this verbiage. Anyway, so the bottom line is, you can block people and let me see if ive got anyone in that case, even someone nice. Joe, here is the catch. They can still write about it. They just cannot use your but i wont see it, right . You wont see it, but the rest of the world will. Go on a message board sometime and search sorkin. Trust me, i know. Anybody who is out there knows that. I sadly know. I sadly know. If you dont see it, its not happening. Its a good way to think about it. You know, big stars and ive seen this recently, they have to can you imagine affleck after batman, the amount of stuff that was pikers, we deal with three things . Aflfleck dealt with 3 million. Gweneth paltrow, how about the one you know . Ann hathaway. There are people devoted to hating ann hathaway. Its a lesson that we all need to develop thicker skin. Lets do it right now from here on out. From here on out, let us be thicker skinned. Deal. We hopefully wont need it. Were going to go across the pond for a moment. It is time for the global markets. Our good friend Ross Westgate standing by in london with a mix of red and green behind him for the Holiday Season. Thats right. A very good morning to you, andrew. And we have been in the session. Were about up to the session highs where we wandered down to the flat line here. Around about 5 to 5, just about advancers and decliners on the Dow Jones Stoxx 600. The ftse was down about 62 points. Up 13 at the moment. We have bounced off the low which we hit around half an hour or so ago. The xetra dax is up 0. 25 . The cac 40 is up about 0. 3 . The ftse mib is up 0. 3 today. Peugeot citron has been feeling the heat this week. Its down another 9 today. It was off nearly 9 yesterday. Its down in the last four trading sessions Something Like 23 . Today, the reaction is because u. S. Alliance partner General Motors sold its stake ahead of a possible new share issue by the struggling french carmaker. The french government says its not sure whether its going to buy into peugeot citron or not. But a poor week for investors in the french carmaker. And bitcoin is back in focus yet again. The European Banking Authority is warning that high volatility and a lack of regulation makes Virtual Currencies potentially dangerous for consumers. European Authorities Say they are going to investigate whether Virtual Currencies need to be supervised or not. So more scrutiny coming from regulators on Virtual Currencies, as well. Thats where we stand at the moment. Kind of even stevens. For now, back to you. Thank you for that. Now we are going to go jump from london to dublin where ireland is reaching a major milestone this morning. Julia chatterley joins us now with that story. Good morning, julia. Good morning. Well, as you said, ireland becomes the first eurozone country to exit its bailout program. The irish finance minister said to me, this is a huge achievement for a country that in the last few years has suffered a Property Market crash, a Banking Sector crisis and ultimately had to borrow 114 billion. Now, the best way to explain this story is to look at their tenyear yields. Back in 201 1, they were borrowing at almost 15 . Since then, rates have come dramatically lower. And i asked the finance minister if he sees more room for improvement in those borrowing rates. We are borrowing at rates that we couldnt have done. It is hard to predict the future. But i always say that we have come from the position where we were into raising and in terms of spreads, we were the strongest of the weak. And now we have moved into a Different Division where we have started by being the weakest of the strong. He said that the country is the weakest of the strong. And those weaknesses include debt levels that are higher than before the financial crisis. A huge spike in unemployment particularly for young people and concerns still about the health of the Banking Sector. So yes, its a positive message here from ireland today. The direction is right. But the road to recovery is going to be a long one. Guys, back to you. Thank you. Andrew. Nice to see you. Lovely tie youre wearing. Thanks. Today i saw him. He came in and tried to sneak in in that new suit. Im pretty perceptive because i saw you out of the corner of my eye and said oh, my god, you looked so sexy. Thank you. Didnt i say that right away inspect. Yes. He didnt have a tie on. His collar was open. Thats your lightest suit that youve worn. This is a is that a different tie than you started to put on this morning . No. But, you know, the day that he went over there without a jacket and he said you know, i walked past the mirror and i didnt like the way the jacket looked. Thats vanity. No, its not. But thats just something you have to do. Today he strutted over with the jacket on, almost had that going on . Yes, yes. Anyway, coming up yeah. Coming up, the debate over inflight phone calls. Im fine. I know youre fine. I am fine with them not letting this. Others may not be. The controversy is getting louder. That story is coming up in this mornings executive edge. Later, taking flight, wheels up, raising the stakes in private air travel. I will never own a jet, but if i ever could, it would be a cessna, the one that flies high, flies fast. I would be a wheels up member. Ill never do that, either. Scott ernest and Kenny Dichter will be here. First, though, will any planes be able to get out of the new york area this week . Thats the question that alex wallace of the Weather Channel will answer with his forecast. Alex. Good morning. Could be a tough travel time as we head our way into the weekend. No doubt about it. And it all starts here in the middle of the country. Southern plains down into texas, were seeing rain. This is the jennings of this winter storm. Were starting to see, in fact, here, in that purple, a little bit of freezing rain showing up. Parts of kansas into missouri. As the storm system brings the moisture northward and the cold air drives south, we bring in that wintry weather. So icing today across parts of noir at least to start off. Then well switch over to snow in places like st. Louis. Indianapolis, detroit, and then new york city tomorrow seeing that snow. You will transition late saturday to a bit of a mix. Most of new england heading into that snow through sunday. 3 to 5 in this darker shade of blue. That will be south of chicago working into detroit. This is where the big winners will be, particularly the interior spots. Look at this dark shade of purple. Thats 8 to 12 inches of snow. That will be west of boston. Boston, youre right on that edge of dealing with about 5 to 8. In and around new york city, youll be generally talking 1 to 3. Eastern cities, west of the city, 3 to 5 out there. With this wintry weather coming in, i dare to say there will be travel problems for the northeast and the midwest. Thats your national forecast. Squawk box is coming back. Announcer before you hit the road, here is your travelers check. In order to earn revenue, cities have been raising taxes on hotel lodging, car rentals and restaurant meals. And business travelers are feeling it. So which city taxes travelers the most . Find out next. 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. Announcer back now with todays travelers check. Which city taxes travelers the most . Chicago. Road warriors with expect to pay more than 40 bucks in travel taxes for one day after factors in general sales tax. Thats according to the gbta. Right now, its time for the executive edge. This is our daily segment focused on giving Business Leaders a leg up. Yesterday, we were talking about making inflight calls from your cell phone. Now the fcc has voted 32 to start a monthlong Public Comment process to go ahead and remove its current restrictions so you can make those phone calls. The fdc chairman says this is a technical rule, not a rule about usage. But the department of transportation says it isnt so sure that permitting calls is fair to consumers. It may even ban the use of cell phone calls by passengers during flights. On board and on aircraft. Theres a bit of a spat between two agencies or whether you can or cooperate and the fcc is basically saying, hey, theres no technical reason we should prohibit this. How do you feel about you remember yesterday you had about the quiet car on a train . How do you feel about a quiet cabin . Youd pay more or i dont know. Do you pay more . You have to figure that. The airline you pay more for each. You pay more to be part of one, and then you pay to keep it silent. Either way, you pay. You cant separate that. Even in first class, you can hear what theyre doing. Its not the same as in a train where you can go to a physical different car. I would like other people not to be able to make calls, but i would like to be able to do them. Thats what everybody wants. Im okay if no one can. Youre okay with as long as you can text and email, you can still get your communications out. And youre fine. Thats fine. Why dont they do that . Thats what theyre considering. Theres a ban on calls that the department is considering would just be on phone calls. They would still allow all other like email and texting that goes back and forth. Youre okay with that . You can imagine certain people you. Wouldnt want to be near while making phone calls, right . I can imagine a lot of thom those people. Not by name, but do you know the type . How about a telephone booth, an inair telephone booth ta you could go into. Do you remember die hard 2 . There was that annoying reporter whose name was dick something, who was trying to phone in the story because he knew they were being hijacked . So he made his way into the bathroom and got stung by the bonnie breaks in and gets him with the stun gun at the end. And everybody claps. Maybe he was in both because he was definitely in the first one. Because he says wolfgang and i are personal friends, remember . Right, right. This is the second one where theyre on the airplane and the airplane is being hijacked. I guess the whole point being that even back then, people were totally annoyed by people using the phone like that. I want to raise one other issue. I would assume if you have wifi access on a plane, that its harderer than you think to completely turn the voice signal off, meaning they could say theyre doing it, but im sure people would find apps and things to that will allow you to screen your voice, sort of skypish, but you could do it anyway. So you would be hiding under the covers and talking to the phone . Yes. Like before where you werent allowed to do it on the ground. Youre below my pay grade now. One of the best lines. Never using above again. Youre below my pay grade. The major wireless carrier is making it easier for consumers to unlock mobile networks. They agreed to clearly notify customers when their contract is up and their device is then eligible for being switched to another carrier. Right now, carriers lock smartphones to their networks to encourage consumers to renew their mobile phones. A lot of times theyre subsidizing these phones, its really expensive. An iphone costs Something Like 600 and you can get it toer 200 because the carrier is subsidizing that. There was a battle. The ctia, the lobbying group went and fought this and they got the library of congress to sign off with them in saying yes, they were right. But it spurned this public backlash saying that this shouldnt happen and policymakers have gotten involved, as well. Two thoughts of this. One for you and one for me because i dont have any. Okay. This is silly its not silly, but it is in two respects. First, you can do down the street and for 10, somebody will unlock your phone. I dont know if theyre supposed to do that. Im sure the Telephone Companies wont be happy with me saying that, but it is possible. The other thing is, typically you cant unlock your phone unless youve had the phone for two or three years because youve had this contract. Usually within two or three years, the rates of these phones are being innovated, you dont even want the phone any more. Anyway, thats what i had to say. I agree with andrew. Okay. When we come back, another sharp selloff for stocks. So is this just the prefed meeting jitters or is this the start of a much bigger correction . Starting at 7 00 a. M. , squawk goes shopping to find out how strong the consumer is this Holiday Season. We have steve sadove, a lineup of retail ceos. Plus home depot cofounder arthur blank. Well have some home depot questions for him, as well. Squawk box will be right back. I have low testosterone. There, i said it. See, i knew testosterone could affect sex drive, but not energy or even my mood. Thats when i talked with my doctor. He gave me some blood tests. Showed it was low t. Thats it. It was a number. [ male announcer ] today, men with low t have androgel 1. 62 testosterone gel. The 1 prescribed topical testosterone replacement therapy increases testosterone when used daily. Women and children should avoid contact with application sites. Discontinue androgel and call your doctor if you see unexpected signs of early puberty in a child, or signs in a woman, which may include changes in body hair or a large increase in acne, possibly due to accidental exposure. Men with Breast Cancer or who have or might have prostate cancer, and women who are or may become pregnant or are breastfeeding, should not use androgel. Serious side effects include worsening of an enlarged prostate, possible increased risk of prostate cancer, lower sperm count, swelling of ankles, feet, or body, enlarged or painful breasts, problems breathing during sleep, and blood clots in the legs. Tell your doctor about your medical conditions and medications, especially insulin, corticosteroids, or medicines to decrease blood clotting. In a clinical study, over 80 of treated men had their t levels restored to normal. Talk to your doctor about all your symptoms. Get the blood tests. Change your number. Turn it up. Androgel 1. 62 . I wanna spread a little love this year [ male announcer ] this december, remember provocative design and exacting precision come together in one powerful package at the lexus december to remember sales event, with some of the best offers of the year on our most thrilling models. See your lexus dealer for exclusive lease offers on the 2013 ct 200h and, as a gift from lexus, well make your first months payment. Yep. Got all the cozies. [ grandma ] with new fedex one rate, i could fill a box and ship it for one flat rate. So i knit until it was full. Youd be crazy not to. Is that nana . [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. Welcome back to squawk box. Im joe kernen along with becky quick and andrew ross sorkin. Its friday, the 13th. I got married on friday the 13th. You did. And it was something. Like 13 is a lunar all kinds of stuff is happening, which is fine. Her birthday is halloween, so theres a lot of weird powerful things going on. Powerful. Powerful things. Topping this mornings headlines plus it was in hawaii and the guide who married us i think were married, but the guy who married us was going you know . Were you under a ladder or what . Might as well have been. But the guy seriously, there was a lot of hawaiian spoken and at the end, we assumed that it was all legal. Wow. Twitter reverting back with i was just talking to someone about it, because the spam thing conjured up that im snuting a state. Its my favorite state. You can keep the other 49, really. I like the other 49, but i love hawaii. The worst island is the best place in the world. Oh, yeah, twitter reverts back to its original blocking policy after rule changes were met with user backlash. New rules would allow a blocked user to view or tweet at the person who blocked him or her, but the activity would be invisible to the victims as if the offending account did not exist, but were talking about this, but then it backtracked, anyway, right . Right. Now you know, when you block people, everyone knows. Is this hot . At 7. 5 , right . Yeah. But we got the video. Its hot. It is so hot. Its that hot. 7 . We have the video, so lets fall it. Its hot. Shares of Hilton Worldwide debuted yesterday. The stock added 7 . Its hot. The tenyear gives you 2. 8. This added 7 in one day. Thats hot. It closed at just above 21 a share. And even the worst private equity deals are finally going to work, right . Some of them are. They did very well with that. Yeah, but they didnt initially, did they . No. It looked like an absolute disaster. But they made 8 billion. And theyre stuck with the stock for a while. Hey, squawk box, thats hot. Thank you, paris. She it looked like she really liked us here. She did. I think she liked the show and everything. Her expression. She cant fake that, right . Cant fake it. They never do. And north korea, treading lightly there, north korea says the uncle to dictator kim jong un was he was executed for trying to overthrow the government and there were a lot of charges that were read. And its hard to translate, i think, sometimes because it sounds kind of strange when you translate what the accusations were has certain people saying he was not enthusiastic enough. And when he was clapping, he was a real confidant to kims father. Obviously. He was his brother. Well, i dont know whether it was his fathers mothers son. But he had been considered the countrys number two official. And unceremoniously executed him. Wiped out footage. Ive seen footage of a movie where they recently put in and they sliced him out of everything. He doesnt exist. I saw footage of where he was sitting in a room, two guys came, they pulled him out of there and it was horrific and everybody else was sitting there like this watching this guy be led out. It doesnt give you a lot of confidence about what you can and kaekt expect from the leader of that leader of the country at that point. But we are jinglistic and we think that we do everything here the proper way, but its not so. But i saw putin yesterday taking the moral high ground saying russia is the moral arbiter of the way things should be in the world. And you think of some of the walls were dealing with over there with the olympics. Are you seeshus . Youre really saying that . The law when they decide to enforce it. Its really . Youre the leader of the world and from a guy who just who stole the ring. And completely did away with the news energy. Hes a great guy. Lets talk about the markets. The dow saw its second straight day of steep losses ahead of the feds twoday meeting next week. Joining us right now with more on this is jason pride, director of Investment Strategy at glenn mead. And on the economy, we have nariman behravesh. Adjacent crone, why dont you tell us, is the market giving back gains at this point . Because people are locking in what theyve already made this year and is this because we worry that the fed is actually going to taper in december . Sure. I think you have to recognize that the market is up about 30 this year on the back of a fairly strong gain the year before. Perhaps some investors are finding a reason or finding excuses to rebalance the portfolios and forcing the market in the other direction. But at the end of the day, when you dig into the details, its hard to make a convincing argument as to why this market should fall hard. Were sitting at fairly reasonable valuations, maybe a slight premium to fair value. And economic circumstances seem to be improving as we go into 2014. You can make a case about fed money tapering. Is it going to change that much . I dont think so. Investors should look at Material Weakness as a buying opportunity. Material weakness is of 5 or 10 or more . 5 or 10 would easily be Material Weakness. Is that going to make that much of a difference in your edition . Probably not. Once you cross that 5 line, youre probably getting a reasonable idea of where things were. Nariman, jobs numbers have been better than expected. Do you think theres enough for the fed to say that they should begin to taper next week . Im going to give you one of those economist answers. What probability is there for december versus january. Id say 40 december, 60 january. Partly because the data that youre talking about is still fairly new in the sense that the upbeatness of the data is fairly recent. So they may wait ool month just to be sure. But it wont be any later than january, certainly. Could be this month. Next week. Are you concerned at all with whats been happening with the retailers . Maybe theyre having to give stuff away in terms of big discounts to try and get people in the doors. How strong is this Holiday Shopping season . Well, its a little hard to tell. As you know, the retail Sales Numbers have been very strong, much stronger than most of us expected. My guess is it will be a decent Holiday Season. It wont be gang busters. What are we looking at year over year . 4 , maybe. Something like that. So not bad, not great is the way i would characterize it. Jason, how about you . If you think at this point that stocks are fairly valued, do you expect the gains to continue . We do expect the gains to kind of continue to kind of plod higher. I think when valuations are good and the Economic Growth is good, you can grow at a reasonable amount. Earnings growth has been subdued through this period. That doesnt necessarily mean the stock market cant try to hire that Earnings Base inches up. Jason, narimanariman, gentle thank you for being with us and have a great weekend. You, too. Thanks for having me. Coming up, Kenny Dichter and scott earnest, theyre going to join us. If youre looking for a little reading, go to squawk. Cnbc. Com. See all three of us as dilbert characters. Its all in this weeks edition of talking squawk box. Squawk box coming back right after this. 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. Every day were working to and to keep our commitments. And weve made a big commitment to america. Bp supports nearly 250,000 jobs here. Through all of our energy operations, we invest more in the u. S. Than any other place in the world. In fact, weve invested over 55 billion here in the last five years making bp americas Largest Energy investor. Our commitment has never been stronger. Afghanistan in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, 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 current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Every weekend worked, every idea sold. You deserve a cadillac, the Fastest Growing fullline luxury brand in the United States. Including the all new 2014 cadillac cts, motor trends 2014 car of the year. Now during our seasons best event, get the best offers of the season on our Award Winning products, like the 2014 ats and srx. Welcome back to squawk box. Diamond property group, largest owner of malls and service will spin off its strip Center Business and smaller enclosed malls into a publicly traded reits to disbeautiful to shareholders. Theyre expected to initially have an interest in 44 malls. Coming up at 7 30 eastern time with wire going to get an outlook for the Outlet Centers with the ceo steve tanger. You can be excused, because in its like a tangerine. If youre in spain and youre going to go the tanger, because youre an international, thats why you said tanger. Thank you. Thank you for balancing me out. Your turn. Oh, it is . Its right bheend me. Kenny dichter rolls up the stakes. Scott earnest, theyll tell us about their new deal first on cnbc. Its estimated that 30 of the traffic in a city is caused by people looking for parking. Thats remarkable that so much energy is, is wasted. Streetline has looked at the problem of parking, which has not been looked at for the last 30, 40 years, we wanted to rethink that whole industry, so we go and put out these sensors in each parking spot and then theres a mesh network that takes this information sends it over the internet so you can go find exactly where those open parking spots are. The collaboration with citi was important for providing us the necessary financing; allow this small startup to go provide a service to municipalities. Citi has been an incredible source of advice, how to engage with municipalities, how to structure deals, and as we think about internationally, citi is there every step of the way. So the end result is you reduce congestion, you reduce pollution and you provide a service to merchants, and that certainly is huge. But with less energy, moodiness, and a low sex drive,y first. I saw my doctor. A blood test showed it was low testosterone, not age. We talked about axiron. The only underarm low t treatment that can restore t levels to normal in about 2 weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or Breast Cancer. Women especially those who are or who may become pregnant and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting and increase in psa. Ask your doctor about axiron. Private Aviation Companies wheels off announcing today that its teaming up with cessna to add at some point 150 jets by 2020 to the fleet. Here to talk about that partnership, Kenny Dichter, founder and ce of of wheels up and scott earnest, ceo of cessna. Welcome and that you can for coming. You came in from wichita, right . Yes. Which is the home of the shockers. Undefeated . Wisconsins undefeated, as well, joe. All right. I dont know why. Okay. So you started. Yes. Fractional ownership, used it was finally bought by net jet. Youve been coming on the show as youre building another competitor, i think. You start with a beach craft for the twohour flights. Its a turbo prop. Well, we ordered 105 of those from beach craft. Unbelievable guys. And now the next move is but you ought bought in a gentleman from europe for the Global Express on the long end. Thomas flurr based in europe. And now youre here. Weve already sold ten of those. You have . Ten memberships. You need to be able to go on the business. The middle. And i said before we came on, the only jet id ever need would be the citation. It goes higher and faster than any of the other jets. Well, joe, were building an absolute total aviation solution. The most efficient solution that a customer would want. On the flights less than two hours, you want to fly at 3950. What does that mean . Per hour. Per hour. But 60 of the lift well need for our 10,000 members in 2020 is going to happen on jet planes. And cessna is the number one light mid cabin, super mid cabin manufacturer in the world. And to sit next to scott and have a commitment from his company to support wheels up, unbelievable. Its like a partnership sort of. Youre doing the financing, for wheels up, scott . How does it work . How many you starting with . Well, we can based on how our membership is stacking up, 15 to 20 airplanes a year. Were going to do a combination of preowned, theyre going to refurb for us, backup for us, new planes where appropriate. And we can take 15 to 20 airplanes a year. Youve got firm orders for 20 of them already . No, we have a little bit less than that. But were already set with the orders. Weve started the conversion activity. Were really excited. Kenny is an individual that really understands the market with what hes done marquee jet. We feel we have a competitive product. Its reliable, i think our customers are happy to be in the product. And opened up a whole new space of customers that can access the product. I want to know, whats the difference in terms of the type of customer going with wheels up compared to net jets . Well, its interesting, i think the net jet business is a great business. I mean, we were we built it over the last ten years and it handles a niche market in the airplane space. What wheels up does is opens up 3 to 5 times the 150,000 people we targeted. I believe that 1 3 to half marquee folks will end up supplementing their Aviation Portfolio with the wheels up card. What were they doing before . In terms of the people . Where were they flying . You said supplement, theyd be theyre going to supplement. Yeah, they supplement with charter. The aviation consumer has become a lot smarter. And i think that people are using net jet for the tough stuff, stuff into the mountains over the Holiday Season. But when youre doing hour, 2 1 2 flight, youre going to use the king air. You can use a jet in the Charter Market and were going to be able to put that whole thing together in a box and give people, you know, a better solution at a better price with all of the safety and security that we built at marquee and net jet. Thats the new deal. How many members do you ultimately need to make the economics of this work . Youre making a Huge Investment in these planes. We break even at a very reasonable 2,200 members. Ill have that done in the next 18 to 24 months. I had my old partner at marquee jet who is my first ceo, he signed on, my cofounder and running the offense. And to sell 2,000 people, andrew, at 15,000, 750 for a membership versus the 180 i used to sell at marquee, we could be faster than projected. Madison avenue, 5th avenue, last week i told him in the green room about this before, with somebody wearing one of these hats who was clearly a customer was wearing one of these hats. Have 150 customers signed up, well do 250 by year end, 1,250 by the end of 2014. And we just signed a little deal with david heller and the flight guys to make sure were again, think total aviation solution. Hold up, test run. This is not a 1 type thing . No. This is less than 1 . People at 1 cant do this yet, can they . Youre still playing in the 1 . You know what, joe, for the first time in private aviation, i actually think we have you need friends to go, even if youre a well off person. I would say theres probably 5 Million People in america, which will give you about 1. 5 . You only need 2,200. When will your leanest years for Business Jets . Obviously, 2008 with what happened was a very difficult year. That was on a scale of one to two, that was a one minus ten. What was 2009 . Were probably around to three to four. Whats 2012 . 2012, were up to five. And now 2013 . Were still around five. 2014 . Were moving to six. When was the last time you saw a nine or ten, 2007 right before the crash . Right. And realistically, i think youre going to see a steady growth. You arent going to see the hockey stick growth that happened in the 2008 time frame. Were pretty comfortable. Weve got our volume production matched to what we see, the opportunities. I think the other thing for the opportunity we see, not only the individual level but the fortune 500 level for supplemental lift. Fortune 5,000. Thats a good point. And how much is cessna overall . Were about 30 of the revenue. Its important. Yes. You can count on us for heller flight. We defer to andrew for that because thats how he gets in here every morning. Not really. Not really. Some people believe. Some people who watch the show actually think that. I wish it was the case. Thank you. We appreciate good luck. I worry about you. I mean, just because i think youre personally signed up. Youre a great salesman. Joe, im all in. I know you are. I have 100 belief that we have the absolute right product for the marketplace right now. And i think in cessna and beach craft and vista jet, we have the right partners. Thank you, gentlemen. When we come back, Steve Liesman unveils the results of the all American Economic survey. And we have a special guest host today, steve sadove. [ male announcer ] this december, experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. This is the pursuit of perfection. At the lexus december to remember sales event. So when my moderate to severe chronic plaque psoriasis them. Was also on display, id had it. I finally had a serious talk with my dermatologist. This time, he prescribed humiraadalimumab. Humira helps to clear the surface of my skin by actually working inside my body. In clinical trials, most adults with moderate to Severe Plaque Psoriasis saw 75 skin clearance. And the majority of people were clear or almost clear in just 4 months. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer have happened. Blood, liver and nervous system problems, serious allergic reactions, and new or worsening Heart Failure have occurred. Before starting humira, your doctor should test you for tb. Ask your doctor if you live in or have been to a region where certain fungal infections are common. Tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. You should not start humira if you have any kind of infection. Make the most of every moment. Ask your dermatologist about humira, today. Clearer skin is possible. Time for another big lineup on squawk box. First, squawk goes shopping with former saks ceo steve saddove. Steve tanger, ceo of tanger Factory Outlets. Plus, home depot cofounder arthur blank on his tea time with pga tours super store. All that and Steve Liesman delivers the all america survey. tis the season of the stressed american consumer. Squawk box begins right now. Good morning, everybody. Welcome to squawk box here on cnbc. Im becky quick along with joe kernan and andrew ross sorkin. We do have a big lineup this morning. Former saks ceo steve saddove is our guest host, hes also bringing some friends with him. Steven tanger, who is the ceo of tanger Factory Outlets and mindy grossman. Plus we have arthur blank and the ceo of pga superstore. Theyll be talking to us about whether or not golf sales are making the cut this season. Right now, though, lets get to the markets and todays top stories. Directv is exploring the idea of an online video service. The Company Plans to target pricesensitive people. Also directv and the nfl have agreed to a framework to renew the popular sunday ticket football package. The deals not done yet but they are continuing to negotiate. And cocacola says that it will split its north American Business into two operating units. This is part of the beverage giants plan to return to a franchise model. Theyll be called cocacola north america and cocacola refreshments. The Consumer Price index will be released today. Economists are expecting an unchanged reading. The futures this morning have been indicated a little bit higher after three down days in a row. Right now, the s p futures up by just over seven points. A little practical news relating to twitter this morning. Making changes to the sites blocking functionality, which joe used to use regularly. Apparently greeted with open revolt. Hes blocking this morning. Everybodys been very nice. Reiters reporting that after this all happened, they put the new program into place, rushed into a meeting last night after a lot of negative feedback surrounding some tweets to the blocking function. Now, what they were doing was this. Used to be that when you blocked somebody, you knew immediately that you were blocked. They thought that because people were being told theyre being blocked that it was creating some bad behavior on twitter. Then they decided they were going to put in a program so that you block somebody but the other person wouldnt know they were being blocked and continue tweeting away. Apparently the twitsphere didnt like that. That takes away all the satisfaction. Of blocking somebody. Im glad they backtracked quickly. They should just allow both of it. If you want an anonymous block or a real block. I would never have a reason. No, but the point of the blocking is also so they cant tweet about you. Oh, when you block somebody they cant tweet about you either . They cant use your user name. I didnt know that. Take a look at twitter shares. I dont know if this is going to impact regular shares. 56. 28 if youre in that ipo, youre a happy camper right now. Oh, right, you hate the phrase happy camper. Theres a phrase i dont hear enough. Theres a phrase thats not used enough in the english language. Happy camper. Where did that come from . I have no idea. I just want it to go away. Its okay, though. Time now for the results of the all america survey. Steve liesman has the highlights. You going to be onset with us with just normal stuff, steve. Not just the survey. The survey and also stuff on the economy. Well talk to you and give me whatever they call it on no, its important to talk about it because the markets been down three Straight Days and the economys getting better. Why would it be down when congress was passing a debt bill a budget bill. You would think its reacting to the taper, perhaps, and also the long end of the curve a little bit. Stick to your guns. Im standing right here. Im not going anywhere. 800 americans around the country. And really, guys, we have a contradictory survey. Ill come back in the next hour and show you those, they look pretty rosy. Heres this survey, first is our spending results and heres the actual numbers. And theres the green line, the cnbc estimate over the years. Lets take a look this year. The mrf is forecasting 738 for a 2 decline per person. And heres our forecast, a 9. 4 decline to 681. A big difference right there. Well have some reasons well get to in a minute. But i want to show you, first, the performance of the survey. This is our estimate in green. You can see one, two, three, four years out of the six. Weve done very well. Two years, right after recession, i dont know why that is, way off. Is this one of those years . Or one of those years where we have it right . Lets take a look at some of the reasons the shopping plans compared to, say, a year ago. You can see what we kind of double check our results with this question. You can see a large percentage, more than 40 saying they will spend less compared to a year ago and 40 about the same. Only a small percentage in the 12 saying theyll spend more. But then we ask, we were interested. It was washington having some kind of effect, 26 said you know what, compared to a month ago im spending less. Perhaps some effect of whats happening in washington and the budget ceiling fights there influencing shopping. Lets go through now and take a look at why they say they are. By the way, this is an openended question. We dont give them an answer, but these are the answers they give us. Income lower one of them, the bad economy, they want to save more, trouble paying their bills in there. 5 told us as a reason for why theyre spending less. Its really important this is driven by the wealthy. You can see, 18 to 34 is among those who compared to a year ago are spending less. Men, even if your home values are up, youre spending less. That may be a subset of this next group. The wealthy in our survey, guys, spending over 300 less. What does that do . It brings them down to more normal levels. The past two years have been very high. Theyre down to more normal levels relative to the average and where they were before. Well see if this plays out. But whats interesting is as you hear in the next hour, stuff on wages and stuff on housing, and even inflation concerns are down. So those things tell us that people should be spending more, but when we actually ask them what theyre spending. Its interesting, the survey over the black friday weekend showed the same thing. Yeah. That was down. It was down, people were saying they were spending less. Weve heard from retailers who say the traffic has been down but maybe the spending was up. It was just the bank rate survey, bankrate. Com, almost the same results but the internals were good. People had better views on specific things in their lives. But when we asked them how much they were spending, they said less compared to a year ago. That seems to be the trend. I also wonder, by the way, theres one interesting thing on the nrf survey. When you ask people what theyre doing this holiday, they say a lot of money on things other than gifts. Like what . You would have to be an idiot i dont mean that yeah, you would have to be an idiot to buy a television at any other time than christmas. Thats when you see the discount. I think in a pavlovian way have trained customers to buy around this time. So when the survey calls up, the real answer is im buying all kinds of stuff but only this portion is for the holidays. I wait until christmas time to do a whole bunch of things. Theres a lot of research, for example, companies, they do their r d in recessions because theyre waiting for the tax breaks. I think the consumers are the same way. More spending has been brought forward. We may not be picking up the spending for Holiday Spending. Thats an interesting point. Why dont we bring in our guest host. Liesman, you staying . Let him stay. You finally extricated yourself. I mean, that was sickening to watch you try to get one of those cards joe, its the ability to my dream in this world is to live on a tropical island, and the only way to accomplish that is with a jet. So what i need to do, joe. In order to get that jet and fulfill my dream of being able to go bone fishing in the morning and come to work in, you know, in the afternoon im going to look up bone fishing, by the way, thats got to be something dirty. No. Listen to me, you want to be you are a bona fide liberal. Youre a liberal but cessna jet liberal. I dont want to be rich, i want the jet. Hes no longer ceo of saks. So youre staying you have set the model. You have tried. How many years have we invite the president of one university. Folks, they have no news value. Folks listen to me. I invited the georgetown thank you, becky. It was news value. I saw him at sun valley. The only news value is to get joes kids in my sons 11. I invited the Georgetown University president. Are you it has nothing to do with that. It has to do with the Higher Education process. I chair the board of hamilton college. Ill help you guys into hamilton. Lets get back to whats happening at the Holiday Season. It has been a really different season. Ive been surprised this year. Weve seen spending from consumers that could be down. What are we getting . I think you have a lot of cross currents going on. Clearly you have growth in the internet. The internet is continuing to explode. Youve got amazon. Thats what i think it is. And people, the weather, by the way, isnt helping any because for the stores because people moving more quickly toward the intoer net. But i think theres a concern and melee with the consumer. Even though unemployment is coming down, the job creation is a lot in the Service Sector where theyre not as high wages, people dont feel flush with cash and theyre very promotional. People are looking for the deals. So even when you see the sales coming in thursday night on the weekend, what youre finding is that people are going after the best deal they can. And, boy, they understand whats going on. Youre finding promotions are playing up much more heavily than of you seen in the past. You go back to that internet point. And i find my own behavior. Im rarely out in a mall and people dont have time. Do you know how many dual households, theres not a lot of time to get out. So the internet, to me, this is the year of the internet. Our survey, percent of people who say they do most of their shopping online doubled in seven years. I believe it. The percent of people who say they have bought an item other than a music or an app on their mobile phone also doubled, a third of the country now. So not only is there extreme movement in this, its accelerating. Well, its accelerating and i think also whats happening, its not just one channel or another. Whats happening is the channels are becoming blurred. Used to be the people think internets going to take over and stores will go away. Now its seamless. People want any time, anywhere. They may want to buy it online or pick it up in a store or have it shipped from the store. We have to change our survey. When we ask, are you doing stuff at bigbox stores or online . Im not sure were getting the right answer anymore. Is it bestbuy. Com or bestbuy . In the consumers mind its all best buy. They dont think of it anymore in one channel or another. The product may be coming from the store. What does that do to a mall operator . I understand that retailers can have an online space. Walmart has walmart. Com. If youre a mall operator, how do you capture that loss of the shopper . Im not sure, necessarily. Theyve got to start a couple of things. First, theyve got to focus on experience. People still love going to a mall. And one of the things weve got to learn is its not just about the product. Its the experience the consumers getting. Part of going to the mall is about seeing other people, its getting to experience new things in the store. By the way, they can buy the stuff online from the store. The mall operators have to evolve their model, as well. Its adding up to a trickier Holiday Season than some have been expecting. Absolutely. Steve, youll be back at 8 00 with more from the survey, right . Has joe hit you up for ties or suits or anything . Are you kidding me . Hold on to your clothes, okay. Coming up, we have much more still ahead including ceo of bonton. The cameras were there last night, thats next when we return. And if you are looking for a little reading, look no further than the squawk blog. Go to squawk. Cnbc. Com, see all three of us as dillbert characters this week. And you can read about chris hardwick, the host of the talking dead. And me trying to figure out what a downward facing dog is all in this weeks edition of the squawking blog. Mine was earned orbiting the moon in 1971. Afghanistan in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, 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 current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Welcome back to squawk box. Star studded red carpet event in silicon valley. Call it the oscars for science. There were six winners of whats called the breakthrough prize in life sciences. Our cameras were there, caught up with google. A lot of things, in fact. But this is one of them. And, i think its exciting, its bold, it has the potential to be transformative over time. So i love this cause. I think we have a disbalance in the world today that the best minds are not appreciated enough. And theyll recognize theres a public recognition. Its pretty cool. These guys came together, put 3 million together per award given to scientists, only to scientists, physicists, people curing cancer, all sorts of things. And the whole idea, in an age where we celebrate celebrity rather than celebrate physicists and scientists, theyre making real changes. Exactly. And they brought a number of celebrities there last night in addition. So conan obrien was there and kevin spacey and glenn close was there. The idea is to get young people invested in the education and sciences. Well talk about it later. In the meantime, the countdown is on for christmas. The ceo of bonton talks fashion, the better than expected quarterly results. Squawk box will be back after a quick break. Hi honey, did you get the toaster cozy . Yep. Got all the cozies. [ grandma ] with new fedex one rate, i could fill a box and ship it for one flat rate. So i knit until it was full. Youd be crazy not to. Is that nana . [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. You can fill that box and pay one flat rate. I didnt know the coal thing was real. Its very real. David rivera. Rivera, david. [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. Welcome back to squawk. I love that graphic and the music. Even with some retailers opening their doors on thanksgiving day, this shortened Holiday Season is giving stores less time to make their holiday Sales Numbers. And here with more, brandon hoffman. How are you . Youre a scarsdale man. I am. How do you see the consumer this Holiday Season . Well, i think she certainly is feeling better than she was in the spring. In the spring we were struggling with she was struggling with the higher gas prices in the midwest in the unfavorable weather. We got into october and the government got back to work and gas prices fell. We saw that really help the consumer feel a little bit better about herself. Joe smiled the second you said she. The consumer is she. I want to make sure i want to introduce as an act of congress if we ever say consumer that it should be she. Thats the one gender its she for you. You look a lot better dressed than the last time i was here, maybe i will have to Start Talking about he. Youre getting me to convert. Really . Shes influencing the decision. What were you wearing last time . You know what, theyve got us in tapered shirts now because i used to look, you know a little. Because it was it was billowing out a little. Well, thank you. Youve been looking at me, ive been looking at you, thats fine. Tell us about this weather situation. How is that hitting you . Well, the cold weathers terrific and weve seen a real uptick in outerwear and cold weather. Obviously the snowstorms arent great. And weve got this one hitting us this weekend. But we do enjoy the cold weather. We were talking about before the online versus off, versus this whole sort of multi effort. You guys are a little late on the dot com front. Youre ramping back up now. Yeah. I spent a number of years running neimans. Com. And part of it was revamping the website and getting the brands to make us competitive. We Just Launched ralph lauren last month, we launched michael kors and coach a few months earlier. Now with the team we have in place, the website is our Fastest Growing channel. And how many people are using that channel and going to either return product at the store or how its combining both experiences. Yeah, were trying to make it seamless so we dont really care how they shop or return or how they engage with us. And its clearly every month you can see the uptick with the traffic of the site and how the customers interacting between the site and the stores. We think thats great. In terms of price, the online product versus the store product. Online warehouse doesnt cost a lot, but then theres the shipping and everything else. Yeah. Then theres the mall which costs a lot. Right. And youre trying to do both. Well, i think theres a Tipping Point when you get to a certain amount of online sales where it becomes tremendously profitable. But until you get there, to your point you have to overcome the shipping charges and the fulfillment charges. Were kind of in between right now. Its big enough, were starting to make Real Progress there, weve got a ways to go. Opening up new stores . Not really. Weve opened up two new stores this year. Our store base is constant around 270 stores. Fair enough. Andrew doesnt look any better than last time . Andrew was a guest the last time. Its been that long . Its been that long. What was i wearing . Some uglylooking tie . Ill have to go back to the videotape. I want to go back to that. I need to know so i dont do it again. Hows he looking . Hes looking sharp. Scarsdale boy. Just because youre from the same neighborhood few blocks away. What do you think of the last two weeks of the season . The rest of the holidays . We hope its cold and no more snow. Well take our chances if we get that. Promotional . Oh, its already promotional. Like i said off camera, ive been in the scarsdale diet. You told me it wasnt working. He said. I tried, it wasnt working. She wasnt his wife. Right. That was part of the problem. Up next, will the weather be a factor for the Factory Outlets . Steve tanger of the factory Outlet Centers will be joining us with his forecast for the consumer with just 11 days of shopping left until christmas. Also, at 8 00 a. M. Eastern time, former White House Council of economic advisers, the chairman alan krueger will be our guest. Just in time for the fed meeting. Squawk box will be right back. Hi honey, did you get the toaster cozy . Yep. Got all the cozies. [ grandma ] with new fedex one rate, i could fill a box and ship it for one flat rate. So i knit until it was full. Youd be crazy not to. Is that nana . [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. Daves always wanted to do when he retires keep working, but for himself. So as his financial advisor, i took a look at everything he has. The 401 k . Insurance policies. Even money hes invested elsewhere. Were building a Retirement Plan to help him launch a second career. Daves flight school. Go dave. When people talk, great things can happen. So start a conversation with an advisor whos fully invested in you. Wells fargo advisors. Together well go far. Hi honey, did you get the toaster cozy . Yep. Got all the cozies. [ grandma ] with new fedex one rate, i could fill a box and ship it for one flat rate. So i knit until it was full. Youd be crazy not to. Is that nana . [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. Welcome back to squawk box right here on cnbc. Were just about an hour away from key economic data. Producer price index data will be out at 8 30 eastern time. Economists are expecting no change and up to. 1 food and energy. A new type of diabetes drug from bristolmyers has been endorsed by medical experts two years after it had been ejected by regulators. A panel now recommending the approval. The benefits of the medicine appear to outweigh its risks. And finally, the budget passed the house 33294 after lobbying by both republican and Democratic Leaders in support of the plan. The senate will now pass that bill for it to go to the president s desk. President obama has said, of course, he supports the bill. And well see what happens. Also, twitter is backtracking after some changes so the sites blocking functionality. Those changes were greeted with open revolt. Reiters reports that executives rushed into a meeting last night after all the negative feedback surrounding tweaks to the block function that could prevent harassers from following them or interacting with their tweets. Used to be you block somebody, they knew immediately they were blocked. The changes came in so that you blocked them but they never realized theyd been blocked so they kept tweeting along happily. The twittersphere didnt take kindly to that change. And now theyre back to the old way where you block you block somebody and you know theyre being blocked. Twitter shares this morning are indicated higher, up by about 1. 6 to 56. 23. That decision makes me the stock has done unbelievably well, and makes me wonder about the management at that place. To take away the gratification that users get from blocking someone. I understand it. Thats a stupid move. No, i think they should introduce both of them. I think you should be able to block anonymously. Why . So you dont stir them up. Because if youve got a crazy american who is kind of st. Augustine you and going after you, the last thing you want to do is poke them right in the eye. That may happen to me at some point i would want to do that, i guess. Id like to have the option. The reason i you know, this is the reason to do it. Obviously everybody else. I like that twitter reacted quickly. People dont all blocking them now . Whats the point of blocking them . People said that. Now im questioning management. Whos running that place now . Steves right. They turned it around. Thats right. If you respond, then youre doing well. Another storm across the midwest towards the northeast. Just in time for a big Holiday Shopping weekend. With only one more week to go, one more weekend, i mean, how are the outlets fairing . How are steve tanger, president and ceo of tanger Factory Outlets. How are you, sir . Im fine. How are you today . Just i hear Factory Outlet and i kind of get kind of a cold sweat and i feel like running and going there. How is business, would you say, at this point this year . Actually, our business has been very good. The consumers have always responded to great values direct from the manufacturer on the best designers and brands around the world. And most of them are available at tanger outlets. So youre all over the place, obviously. Tell me about how weather has factored in so far. How its expected to factor in this weekend. Weathers always a factor. The season started as early as november. And our merchants and partners have been offering great values. Our traffic was up about 3 during the month of november and continues to trend up in low, single digits. How should we look at the way you operate . Youre in reit, its not a yield reit. Why would i mean a stocks done really well since 09. I dont know how to interpret weather its a buy, sell or hold at this point. What would have to go really well for an investor to buy into this and say, wow, what a great investment. Not our 3 yield which is a dividend. By the way, weve raised our dividend in each of the 20 years weve been public. A limited number of stocks able to do that. Our company is a growth company, managements job is to continue to increase its funds from operati operation. And the markets determined the multiple involved in that. Qualcomm is announcing a new Succession Plan that includes being promoted to chief executive officerelect of the company. Paul jacobs is going to be sticking around in a new role for this to kind of lead this transition. How old is he . Hes like i know, i did not think he was very old at all. Hes not. He is sticking around as executive chairman. I still havent seen them yet. But this is has been around for about 20 years at qualcomm. Held a number of different positions, including leading the chip set business and they say successfully driving innovation and record growth. Obviously a stock that has been a very strong performer if you take a look just where its come this year. What about five years . Any guesses on the market cap. Yeah, you know what it is because i looked already. You can you can roll up three or four dow components and not get. 122 billion for a whats intel now at this point. Thats probably a pretty good race. 121, its above higher market cap. Steve was on the list at one point, reported list to be the new ceo of microsoft. Oh, wow. Reportedly. A speculative. 51 years old. What andrew is suggesting, i wonder if this is aed by to make sure they keep him in the family. Keep him happy there and make sure they have the leadership transition too. Paul jacobs is 51, he can be chairman. It was a family company, right . Yeah. At 51, if i were paul jacobs, id be ready to go, chairman. Flying around on one of your jets you were talking about. Anyway thank you. We digress. You were saying, so you need to add more outlets . How would what would go really well for you . Its great to have thats one reason to buy a stock. If you can count on a Dividend Increase every year, you do the math and you can see that the share price should follow over time. What else has to go well . We are a growth company, we have the most robust pipeline in United States and canada our companys ever had. Its about 350 million we plan to invest in the next 18 to 24 months building new Outlet Centers. We just opened one outside of washington, d. C. Which opened close to 99 occupied and had over 250,000 visitors in the first weekend. I heard, steve, that was huge crowds you were getting at that one. Talk to me about whats going on in terms of growth of new shopping centers. Right now, almost nothing going on in the regional malls yet youre seeing all kinds of Outlet Centers opening up all over the country and very competitive. Why do you think you have so many outlets opening up and not Regional Centers . We are the most profitable of most of our partners. They get the highest return on investment when they open in tanger outlets. Thats one reason, tenant demand. Second, on the other side is consumer demand. And we are the place where they can do that. Its a social experience as steve mentioned before, its all about the lifestyle. We have restaurants and fountains and free wifi on our site. Do you think at some point it can denigrate the highend brands if they open up too many of these . I dont think so. Only about 160 to 170 Factory Outlets in the entire country compared to 1,100 regional malls. We have a long runway of growth ahead of ourselves. And as i said before, were a growth company. Designer and Luxury Brands open 1 to 2 new stores a year. If you look at the profits of our wonderful partners like coach and michael kors and polo and underarmour, i can go down the list, youll see theyre very profitable in the outlets and continue to grow there. Making a lot of good points there. I love malls, but if you can go direct to the store, you feel like youre getting you know what i mean . You dont have to go through. Thank you, we appreciate it. Up next, National Retail federation chimes in on how retailing is going, state of retailers. At the top of the next hour, alan krueger will join us. Squawk box will be right back. Get a leg up on the trading day with the morning squawk news letter. Go to our show page squawk. Cnbc. Com and sign up now. Morning squawk is a snapshot of the days top stories, guests and some fun water cooler stories that well be squawking about all morning long. Sign up and get morning squawk delivered in your inbox every weekday. Squawk box on cnbc. Profit from it. The American Dream is of a better future, a confident retirement. Those dreams, theres just no way were going to let them die. Like they helped millions of others. By listening. Planning. Working one on one. Thats what Ameriprise Financial does. Thats what they can do with you. Thats how ameriprise puts more within reach. [ 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. My mantra . Family first. But with less energy, moodiness, and a low sex drive, i saw my doctor. A blood test showed it was low testosterone, not age. We talked about axiron. The only underarm low t treatment that can restore t levels to normal in about 2 weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or Breast Cancer. Women especially those who are or who may become pregnant and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting and increase in psa. Ask your doctor about axiron. Checking the futures this hour, up about 46 points, we could use a little respite from the double digit down days. The last two sessions. American international group, meanwhile, is in talks to sell its Aircraft Leasing business to air cap holdings, aig which was nearly wiped out as you know by those derivative bets in the financial crisis. Been seeking for some time to Sell International at least finance corp. To help repay the costs of a 2008 u. S. Government bailout. And Robert Benmosche will be our guest host on monday. And hes in the aig in the ad. The commercials. A week or two ago. He took a lot of flak, too. Yes, he did. He hung in there with personal issues going on at the same time. He was a real credit to benmosche is the reason this things turned around. It was definitely a lightning rod for a good reason on the front end. But weve been hearing that there are still some things get written where you think will never have to be paid off. That was the problem with the 300man unit up in connecticut, andrew. But then afterwards, theres some question as to the way it was handled because you need needed most people the government the government at that point wouldnt let them host sales conferences. And he stood up. He did and they wouldnt let them pay anyone. Now he got the money back and look, i have a tremendous amount of respect. Good, hes on monday, too. Good. 8 00 a. M. , will you be here . Ill be here. 6 00 . On time. Late last night the house of representatives passed the budget deal brokered earlier this week by congressman ryan and senator murray. And the deal is an early and muchneeded holiday present for the consumers. Our guest host steve saddove, hes, of course, here, as well, former saks. Youre not wearing saks right now. We were discussing this. We have so many great thousands of members, andrew, ive got to wear something from everyone. Ive got everything on. Look at this vest. Different than a jacket. Very holiday. I brought you a tie, tote bags. Talk about fashion today. This is a beautiful tie. Going to share it. Can you get close on what this is . Its a can kicker. A can kicker. Uncle sam kicking the can. Uncle sam kicking the fiscal can down the road. Which he did this week. Do you think the senate will follow suit . We know that the last three years this time of year, the congress has found a way to create some selfinflicted wound that sort of, you know stole the end of the year in terms of performance for consumers and investors. And, you know, the last thing we need are more selfinflicted wounds. We didnt raise taxes, we havent layered on additional regulations, havent decided to shut down the government or threaten default on the debt ceiling. Thats a great thing, but thats basic, you know, 101. Lets stay out of our own way a little bit, at least. This group of leadership in washington hasnt been able to do that in three years. Theyve finally done. Thats a good thing. Last time when you the sequestrati sequestration, i saw an immediate effect in the sales. No question the consumer responds. How big of an impact . Several Percentage Points in terms of immediate withdrawal the consumer feeling a little bit scared in terms of whats happening. How do we not come to a resolution . I think you would have seen the next couple of weeks being weaker. Its been a weird Holiday Season anyway, though, even with washington getting this deal done in past. I was stunned by the survey you took after black friday that showed the decline. Havent seen that in a long time. I watched steves segment earlier this morning and more on later. And he was sort of picking up on some of the same themes and yesterday, as well, that in spite of these indices weve seen, Interest Rates or low stock market, home prices are good that the socalled wealth effect hasnt translated into a lot of confidence. Theyll do discretionary but cant seem to do both at the same time. But when the Interest Rates went up in the spring then people spent more on homes improvement and autos and pulled back on discretionary. The indices look good, but we talk about the twotrack the recovery. Theres that other segment of the population that doesnt feel good about that. Is there a correlation between what they plan to spend . Everybody says, going to tighten the belt a little bit. You watch. I mean you watch if you say youre spending less, i know you are when was the last time the survey showed people were going to be spending less . Not since the recession, since 2008 and 2009. Its unusual. One of the things that goes on relative to whether they will or wont spend, as you get to the end close to christmas, the promotions are getting bigger, inventory has to be cleared. The retailers have a lot of inventory out there. And they have they were planning they plan for a decent number, for decent growth, and you have to clear that inventory. And whether or not the consumers spend more is a lot related to what kind of deals theyre going to see. Where do you stand on the minimum wage issue . So the minimum wage is an issue thats gotten a lot of attention. And we think that its the wrong policy conversation to have. We shouldnt be talking about policies. Its not 100 , but a significant number of surveys and studies have been done show increases will result in job losses. 50 of the people who earn the minimum wage, theres 3 1 2 Million People out of workforce that earn the minimum wage. Its not an insignificant number, but we oughting to figure out ways to put those people to work not make it harder for Small Businesses to employ them. Youve got retailers, they employ 42 Million People, 95 of them have one location, half of them employ 50 people or fewer. Youre going to tell those Small Businesses, its going to cost you more to do what you want to do which is hire people and thats the wrong prescription for the economy. Talk about lets get the tax code fixed, do an immigration deal, invest in infrastructure, trade deals. Lets talk about that and not resign these people, okay, were stuck at minimum wage. Its a starting wage. We probably all made a starting wage once upon a time. We dont want people to stay there forever. Lets educate them and move them up. Id love to come back. Its a longer conversation . I know both of you would. Or would you take higher minimum wage, slightly higher minimum wage and get some of these other things, too . If you could alleviate the inequalities for a longterm solution. Theyre playing us out. Ill come back. Well talk about it. When we come back, well have more on qualcomm. Also at the top of the hour, results from the all america survey. Steve liesman reveals interesting points about the consumer and the state of the economy. Plus, alan krueger. Squawk box will be right back. Im a careful investor. When you do what i do, you think about risk. I dont like the ups and downs of the market, but i cant just sit on my cash. I want to be prepared for the long haul. Ishares minimum volatility etfs. Investments designed for a smoother ride. 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. To help secure retirements and protect financial futures. To help communities recover and rebuild. For Companies Going from garage to global. On the ground, in the air, even into space. We repaid every dollar america lent us. And gave america back a profit. Were here to keep our promises. To help you realize a better tomorrow. From the families of aig, happy holidays. For more on this breaking story, we are joined by jon fortt, it is also about microsoft. Absolutely, becky, over the past day or two, as a candidate for its next ceo. And it wouldnt be that out of the ordinary for microsoft. Even though its a Software Company to look at someone like mollenkopf. First of all, qualcomm executives have a decent track record. Sort of led that company to the point where it could get acquired by google. And qualcomm has been doing really well. Mollenkopf led the most important unit for a long time. Chief operating officer there for years. Sort of the heir apparent, but i think its pretty clear to me that this process at qualcomm was accelerated quite a bit. Been talking to paul jacobs, e the well, still ceo at this point. A decent amount lately, and this is the sort of thing they would have telegraphed. It sort of seems to me, you know where theres burnt wood, theres been fire. And in this case, with those rumors and now very next day them announcing that mollenkopf will become ceo in mid march. We were pointing out that paul jacobs is only 51. He will be sticking around as executive chairman, maybe this is just a way to solidify that progression of who will come next and make sure that mollenkopf absolutely, paul jacobs not going anywhere. Hes got technical background, of course. Hes been a very strong and loved leader over there. But its interesting that theyve made this move to make sure that they maintain their bench that can be really important, apparently a thing that microsoft perhaps didnt do quite as well given the fact as weve seen over the past couple of days that alan mulally, the talk about him has died down a bit. Theyre casting their net a bit wider and getting doors slammed in their faces. Jon, thank you very much. Still to come this morning, alan krueger. And also the ceo of hsn, mindy grossman. Plus, Consumer Price index numbers coming up. And the ceo of pga superstores. By the way, if youre looking for a ridiculous reading, you dont have to look further than the squawk blog. Go to squawk cnbc. Com. Read about chris hardwick. And andrew trying to figure out what a downward facing dog is. Its all in this weeks edition. Well be right back. R company and to keep our commitments. And weve made a big commitment to america. Bp supports nearly 250,000 jobs here. Through all of our energy operations, we invest more in the u. S. Than any other place in the world. In fact, weve invested over 55 billion here in the last five years making bp americas Largest Energy investor. Our commitment has never been stronger. Is caused by people looking fore traffic parking. Y thats remarkable that so much energy is, is wasted. Streetline has looked at the problem of parking, which has not been looked at for the last 30, 40 years, we wanted to rethink that whole industry, so we go and put out these sensors in each parking spot and then theres a mesh network that takes this information sends it over the internet so you can go find exactly where those open parking spots are. The collaboration with citi was important for providing us the necessary financing; allow this small startup to go provide a service to municipalities. Citi has been an incredible source of advice, how to engage with municipalities, how to structure deals, and as we think about internationally, citi is there every step of the way. So the end result is you reduce congestion, you reduce pollution and you provide a service to merchants, and that certainly is huge. 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. Impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u. S. . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 70 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. Welcome back to squawk box here on cnbc, first in business worldwide. Im joe kernan, in studio sharing his thoughts with us this morning is steven saddove, former chairman and ceo of saks. But you remember everything you did almost every every decision you made. Most of them, most of them. And youre still at the cutting edge. Still talk to all these people, too. Do still talk to everybody. Now you dont have to be not on the daytoday. Dont have to look at the daily sales. Which is a great thing. You might be able to take a step back and give us the insight. Hope so. Have a little bit of fun. Lets get you up to date with our headlines. The budget bill passed the house by a vote of 332 to 94. Now the senate has to pass the bill in order for it to go to the president s desk. President obama has announced his support for the bill, as well. If it passes the senate, its a done deal. A corporate shakeup. Cocacola says americas chief is leaving the beverage giant. Once viewed as a potential successor is now out. These changes come amid growth issues. Cocacola north america will be headed by Sandy Douglas who will also continue in his role as chief officer. And qualcomm announcing its board of directors has approved a Succession Plan for the chairman and ceo paul jacobs. Steve mollenkopf was appointed to the board of directors. Hell continue to serve as the companys president and will take over as ceo at the beginning of march. Jacobs will assume the role of executive chairman. Qualcomm. That was preyou. It was. It was that was the old building, wasnt it . Yeah, that was the old building. There was a time when we talked about qualcomm so much that we taped this because it was a highflyer. And as much as we played it, people shouldve subliminally listened and we wouldve done them a favor. When we were talking about it it was probably a 20 billion company, its gone up six times in value. What are the odds of a december taper by the Federal Reserve at next weeks policy meeting . Joining us to talk about this is alan krueger, princeton economics professor. Former chairman of the president s council of economic advise advisers. Ive already had to suffer through liesman saying im trying to get my kids into college. Ive got to say i did talk about that, alan, and you graciously invited us for a tour. A tour does not mean anything, liesman. If blake wasnt as smart as she is, i would have a problem with this. But i think you should work the entire interview. When is a good weekend for you . When is a good weekend for you . In looking at your notes, can i call you professor just to emphasize youre at princeton . Or do you like chairman . Please call me alan. Im going to call you alan. Depending on where you sit, you can tell what youre going to say about things. You, i guess, alan are a guy that thinks stimulus might help. Youve gone on record saying qe has been effective and the one thing that we could do wrong here is get out too early which causes them to come back in and reverse course. So you dont think december would be a good time to do this, i imagine. Yeah, i do think that qe has been effective. I think if you look at the timing and improvement in the economy, you can see that. If you look at whats happened to longterm Interest Rates once the fed indicated it might taper a bit sooner than expected. I think they have to balance the benefits against the costs. Were not seeing any signs of inflation heating up right now. And, of course, they also have to be concerned about financial stability. My advice would be that this is not symmetric. I would worry more about tapering too early rather than too late. Certainly when it comes to inflation, thats something they can address down the road. But they are eventually going to have to taper. And theyre also going to have to consider how they taper. Do they cut back equally buying on treasuries and mortgage debt or do they cut back treasuries more and mortgage debt more . The president and with you advising him really had some grand plans for more fiscal stimulus in terms of infrastructure. He calls it investment, i think. None of that seems like its going to go forward at this point, yet youre happy with this budget deal that was signed. So both your side and the other side seem to were resigned to getting very little accomplished at this point. And youre happy about this but it doesnt do anything to create jobs other than get rid of some uncertainty. Well, i think this deal will help a little bit. The president had plans for a grand bargain which would not only invest in our future but address our fiscal problems down the road. And this deal doesnt do that. On the other hand, this is the first time in quite some time that congress has overachieved. Managed to strike a compromise, do it a little bit ahead of time. So that should hopefully provide a little bit of confidence. And relieving, you know, good chunk of the sequester should reduce some of the fiscal drag we faced in 2013. Youd have to have lived the last two years to call this deal overachieving for congress. You would after what weve been through, i guess you can use that. Thats staggering to think this is an overachievement for such an incremental step. Yeah, just go back to what you were saying on your show. I dont think people were expecting december 13th to be a meaningful deadline. So in that sense, i think this is overachieving. But theres obviously much more work that congress should be doing. Steve, you want to talk to alan. Id love to talk to alan. Are you done asking im not done. I should be sitting here and, you know, im alan, i want to get your take on growth. And i also want to get your take on is there a d between the market and the fed. They dont see as that big of a deal, whereas the market, seems like, you know, its the end of the world. Well, sometimes the market overreacts. And it might be the case given the overreaction over the summer that when the fed does start on its path of tapering, therell be less reaction because some of that is built in. In terms of the economy, you know, i think we got this exactly right. We predicted in mid session review that the economy would grow about 2. 6 if we got rid of the sequester, about 2 rate in 2013 with the sequester in place. And thats about where its been. I think that well see a pick up next year because the head winds are starting to fade. But i think itll be gradual. Hopefully well see growth in the 3 range instead of the 2 range in 2014. Did you bring stan fishers name to president obama . You know, as a good adviser, i never reveal the advice that i gave. I can tell you, however, that stan would be terrific if he were willing to do it and if he is nominated. Take that as a yes. As i said, i never deal advice, thats the hallmark of a good adviser. I could also advise joe that the spring is a very nice time to visit princeton. Beautiful. Hes 13, were keeping our options open. Can you guarantee me that her private sector outlook could be maintained at your school, alan . Shell be exposed to a diverse set of views. Look at members of the Supreme Court who went to princeton. Im worried about the entire ivy league. Ive gone with a finetooth comb and ive come up with orel roberts. Thanks for playing along. Maybe some day. Krugman. Yeah, krugman was down there. Thats right. Yeah, great. Super. Anyway, alan, we appreciate your time today and well call this the overachieving for congress. That really, i think is the statement of the morning. Its a commentary on the last three or four years. Just doing a budget deal. Just getting a budget deal done. Thats like if i get up and actually get dressed in the morning. Everybodys view. I think we were all like, oh, my god. Somethings happened. Yeah, when you stop hitting your head against the wall. Weve got a little bit of news. We want steves view on this. Amazon getting set to take on warehouse retailers like costco and sams club in 2014. Usa today reporting the online retailer will be launching new business for amazon prime members called pantry selling about 2,000 common grocery items and packaged goods. So they just got into fashion, actually. In the past year in a big way. Big way. Theyre trying to do supermarkets in certain cities, seattle and one or two other places. Right. This seems like it could be made available more broadly. Absolutely. And think about some of the big, bulky items if you talk about paper goods or dog food. Diapers. Shipping not drones. The drones will come. Whatever you can cram into a box. That fits into the box and weighs a certain amount goes. I have to say, i dont know its the best way of going about it. Im already using a couple of different online groecers and i you can bring me everything i want. My guess is its a starting point. And becomes what . Where is this all going . I think theyre going to take over basically setting the standard. Think about for every category theyre setting the standard in terms of Consumers Expectations and performance. So everybodys now but theyre also expecting prices, low prices. Thats part of the performance. Ultimately that wont work for anybody including them. Well, at some point were going to get used to this Great Service and at some point well have to pay for it in a major way. Thats a major problem, theyre getting their valuation without making any money, everybody else is dealing with the valuations except theyre making the money and the margins are getting squeezed. A big phenomena with free returns. Amazons creating a new paradigm. What does a return cost . Several dollars. Minimum . Oh, yeah, absolutely. In some cases, much more. Apparel, you can have 30 , 40 return rates. Thank you for that. You returned those tommy johns boxers, which i have never i would never return them ever. Im wearing my tommy john undershirt right now. You havent returned this is the greatest undershirt in the history i would say anything you ever get from any online catalog, make sure you wash it. Ive seen it. Ive seen make sure you wash it once . Yeah, i went through victorias secret years ago and they have people whose job it is to sniff everything as it comes back in. This squawkward moment was like, honestly, wash stuff when you get it through any of the things. It gives liesman an excuse to sniff. That was a low when we come back, while the malls may take a hit along the east coast thanks to winter storm electra, hsn could see a boost in sales this weekend. The companys ceo will join us right after this. And later, golf business and the holidays, the ceo of pga superstore, and home depot ceo will be joining us. Mine was earned orbiting the moon in 1971. Afghanistan in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, 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 current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. [ 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. Welcome back to squawk box. Live shots at rockefeller center. Watch Natural Gas Prices today after prices log their highest close in three years as freezing temperatures boosted the demand outlook for the heating fuel. Lifting prices for a fourth straight season. People along the east coast may be staying home this weekend as another winter storm approaches. But that doesnt mean the shopping has stopped. Hsn is the pioneer of home shopping. Its now driving growth through the web, as well. Joining us right now is mindy grossman, the ceo of the network. Thank you so much for being here. Good morning. Weve been talking about how this has been the year of the online retailer. Hsn was the online retailer before there was an internet. What have you seen this year . Well, weve actually seen four major themes this Holiday Season. One is value. And as you know, we have eight businesses from hsn all the way to very highend businesses. And regardless of the income of the customer, theyre educated, theyre looking for value. I think, two, its definitely to your point, its the year of digital and mobile. Customers can search for anything, look for anything, buy anything. And you have to be there mobile first. And i think third, what theyre spending on. Were definitely, i heard matt talk earlier, home, technology, Home Improvement has definitely been a focus and its been a little bit more selective on the real discretionary such as apparel and jewelry. And, fourth, its really about retailers creating an experience to get customers to come to them because it is a race for share of wallet. So you are racing to get the shoppers out there trying to convince them to spend their money on your platforms. Does that mean you have to offer deep discounts if theyre also looking for value along the way . Well, i think where were focused is on giving them proprietary products. So 70 to 80 of all the products we sell by brand are exclusive to us. So how do we give them the best product at the best value . Because at the end of the day, thats what the consumers looking for. You know, one thing wed been talking about with steve, steve saddove, customers are trained to wait for these sales, to wait for these discounts, to wait for big things. Have you found that same situation . You know, our business is very different. Our store changes every day. Its beholden to us to be able to give them that value, that store, that differentiated product. And thats what were seeing. And it could be products such as technology from hp or beatz or nutribullet, or over thanksgiving weekend, we sold in one day over 100,000 pair of jeans or, you know, any of those products. So we are geared 365 days a year to create as much value and as much excitement and as much impulse as possible. And continue to do that throughout the Holiday Season. I was thinking about hsn and thinking about, wow i remember when it was revolutionary to shop on tv. And then the internet came along and i wondered how it would work. Its like everything. Its the content youre bringing. Things with mary j. Blije, all the proprietary stuff, so everything is melding together. Its weird, isnt it . Right. To your point, that differentiated content married to commerce and creating a community is so important. And i like to say were a 36yearold company who is more relevant today than any time in our history because nothings linear anymore. Creating a 360degree network of experiences and were not bifurcated by channel, not linear. Our whole focus is to create inspiring content for people to want to buy product. Its great product, great story and great story tellers. And we sit at the intersection of media, of technology and of retail and thats whats exciting today. And keith urban guitars, hes so cute, too. He that was unbelievable. Let me talk about keith, will you . Sorry. No, go ahead. Hey, mindy, one of the things weve been talking a lot about is the change in the internet and the role its having. You guys have been at the forefront in mobility in terms of mobile sales. I think that, you know, that change is also happening. Just talk a little bit about what you see in terms of mobile sales. Its not just the season of mobile, were in the landscape of mobile. And at the end of the third quarter, mobile is 12 of our total sales. And that number is increasing. On black friday, for example, mobile penetration to digital for the first time was over 50 . And i think that all retailers today have to be thinking mobile first back as opposed to an end state. Because it is the most personal device anyone has. Are people watching tv and then buying literally on their phone while theyre watching . Or is it the experience of literally just buying on the phone independent of your tv . Its a combination of all of those things. Mobile for our business is perfect because its about impulse. We can serve up mobile specific deals, communicate. Its not really about tv. Its really about an ordering mechanism. So 40 of our business is transacted through a digital platform. And even in the other 60 , we have shop by remote in 36 million homes. Mindy, thank you so much for joining us. Happy holidays. Thank you. Happy holidays. Still to come, a lot more, were going to talk golf, gifts and a lot more in a moment. Were back in a sec. 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Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting and increase in psa. Ask your doctor about axiron. The San Diego Chargers shocking. This is a shock. I didnt even see this, the Denver Broncos in denver last night. The chargers offering one of the biggest upsets of the season. The bengals beat the chargers. Beating the broncos 2720. Thats why they play these games. The victory gives the chargers playoff hopes, which they didnt have, really that much. Gives them a boost while putting denvers lock on the number one seed now in some serious jeopardy. Any given sunday. Or monday or thursday. But most important day is sunday and most important time is sunday night. Thats right. When we come back, breaking economic numbers. Consumer price index for november. Take a look at the u. S. Equity futures after three down days, you finally see some green arrows. Dow futures up 40 points above fair value. S p up by seven. Squawk box will be right back. Ya know, with new fedex one rate you can fill that box and pay one flat rate. How naughty was he . Oh boy. [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. [ male announcer ] fedex one rate. [ 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. Your grass waters itself. Your dishes wash themselves. So why dont your floors. Clean themselves . The Irobot Braava floor mopping robot. Irobot. Do you . Welcome back to squawk box on cnbc on this friday the 13th, by the way. It is, theres a lot of those, though. How many are there, actually . A couple a year. I dont know. Theres a 1 in 7 chance i dont know. Theres a lot. We are just a minute away, actually. November ppi, before we do that, though, lets take a quick look at the futures to see how things are setting themselves up for the day. Actually, not bad. Dow looks like it would open up about 37 points higher. S p 500 up about six points. Also the nasdaq closer by about 15 points. Take a look at the tenyear, 2. 866. Want to get a mortgage . How do you feel . Theres a 1 in 7 chance youre back yeah, i am. No, theres a 1 in 7 chance that a 13th could be a friday, i think. I think thats right. And theres also, theres a fear of the number 13, and on average, theres a friday 13th once every 212. 5 days. Thats it . Thats a lot more than i thought. You cant have as many as three in one year. You can have as many as three i feel like weve had a lot, recently. Two this year. Theres a fear of the number 13 and the name for the fear of friday the 13th. Freddy was what i was worried about. We had krueger on. Weve got to go to Rick Santelli standing by at the cme with the numbers, please. What does Freddy Krueger have to say . Jason. Well, we are down 1 10 on ppi. Down 1 10. The systems are freaking out on freaky friday, but ppi isnt bad news, its pretty close to expectations and now i see as you strip out the allimportant food and energy we are up, which matches expectations. These are the numbers that grab everyones attention on a month over month, excuse me, yearoveryear headline up. 7. Both of those numbers are lighter than expectations. Its double our last look which was. 3. On the inflation, you can draw your own conclusions, you had alan krueger. Listen, we can do this forever because we dont see inflation. Maybe they should study the 70s the way they think they studied the depression and figure out when you plant seeds maybe we need a model of how long it takes them to grow or how far in the ground they get. You cant extract them. 2. 86 remains the yield. Everybody continues to monitor that. It seems as though the nervous nelly has been equities. Whether its the budget or how the budget figures into the taper, i find it absolutely amazing when you look at the timing of the weakness of equities, many say, well, its just yearend profits. Im sure it is. But the trigger to take them is, what, significant. Back to you. Thank you very much. Rick santelli. Lets get over to Steve Liesman. Revealing some surprising trends in housing. Steve is here with the results. Yeah, and we told you last hour that expectations for Holiday Spending are down and down quite sharply in our survey, about 9 . Then when we look inside the survey about peoples expectations for key economic indicators, theyre actually up pretty decently. Lets take a look. First over here, the expectations for wage gains, inflation and housing gains. You can see on an average, Wage Expectations are up over last year. Inflation expectations are down and housing gains up quite a bit compared to a year ago. And quickly, here are the Fourth Quarter numbers we registered. 3. 3 expected next year. 2. 8 on inflation, down one of the lower numbers weve seen in quite a while on housing. Not as good as it was in 07. But if youre expecting higher wages and housing, you think you would be spending more. Again, thats not what we found. 10 , the lowest number of people expecting a decrease in the home value. Weve got to come back here, march 2007 when it was 9 . Whats the different . Go on up hes the camera guy. Expected home price gains, now come over here, and you can see we only expect 34 . So thats the difference. More people expecting it to be the same. But in terms of the pessimism about home values, thats back down to 07 values. Take a look at this nice thing here. How much does it matter if your home price is going to increase . Well, heres the average spending by those who say their home value will increase. Going to stay the same, 686. One of the things weve found is how much home values go up is a key indicator on the economy and on spending. Hooergs the survey from december of each of these years about peoples expectations or rating of the economy. 15 say its good. Thats very slightly up, 83 say its fair. Lets compare it with 08. Weve made progress, only 4 back in 08 thought it was excellent or good. Just compare again to here, 83 and now lets compare it to 07, which we think is probably the normal. 72 thought it was fair. Come out again and what youll see is we have made progress from the depths of the recession, but we still remain below where we were before the financial crisis. Joe, thats the story. Back to you. Steve, i just people think that hes holding a camera. No, hes doing unbelievable. This is art. This is art. No, look at that thing, its like lets bring him over here so everybody can get theres the steady cam and hes doing this and over here and over there. They take it for granted. Its unbelievable and he follows the stuff like hes an economist. I say stek over here, stek over there. How much does that weigh . Its heavy. The guy is built. Its heavy, hes got a big brace. I put it on one time and i teetered over in my heels. Totally steady. He wants the camera on him, stek. That is what hes saying. Almost looks like you have a bullet proof vest on. Without him, we couldnt do this. About the methodology, tell me how many 800 million americans surveyed across the country. It was done in the week after thanksgiving weekend. We started on the tuesday and the monday. A little bit better in terms of what they saw in washington during that time frame, you did see a deal put together after that was surveyed. We have in the past when there were big events, becky, you might remember, weve gone in the field again in december. And remember that one statistic from the last report which was 26 said they would spend even less they planned a month ago so we were picking up the debt ceiling debate, i wonder now if there may be a chance things would be a little better. Housing gains and wage gains speak to better spending but did not pick it up on the Holiday Spending. You have a stock market gone up over the course of the year. And to see such poor if you want to call it poor attitudes on the parts of the consumer. Just surprising that you dont see a little bit more optimism. Particularly when the job picture, at least according to the official numbers we get. Theyve ticked up. Does seem to be improving. One of the things we have not seen and economists are talking about, absence of wealth effect from all the wealth. Household net worth reaching all time highs still surging on stock values and housing values. Whats not happening, it appears, is theyre taking that wealth and turning it into sales at retail stores. Thank you. Pleasure. Well be back all day. You can read about the survey online. And if you dont like my take on it, we posted the whole survey. You can get your own take by reading the results. And thank you, stek, as well. If youve ever seen home movies the way he keeps it very steady. Hes steady. Thats true, too. Steady eddie. Freddy krueger. Jason. Youre pathetic. Anyway, arthur blanks insatiable appetite for growth behind one of his latest investments. The pga superstore opening the 19th location in new york. The stores are affectionately called the home depot of golf. Joining us with more on the expansion, Dick Sullivan ceo of pga tour super store and arthur blank, controlling owner and chairman of the superstore. Also one of the cofounders of home depot and owner of the falcons of the atlanta falcons. Welcome. Its good to see you. Ive seen you out on a course before. Not of late. Yeah, it was about five, six, seven years ago. You played some course down in florida. Maybe a trump course. Yeah. Yeah. Anyway, can i buy clubs . Can you fit me for clubs . Will you show my crappy swing on a youll take a picture of it ive seen your swing, its not so crappy. It depends. Well take care of you. I think the description, joe, i think it was joe or andrew, gave of our stores is accurate. Its the home depot for golfers. In terms of value and service and Service Levels and things of that nature, these are unique stores, average about 50,000 square feet. We have 19 of these stores in 13 markets with a dominant retailer in the market we compete in. And if you have interest in golf or tennis, you want one of our stores. Were thrilled with the relationship. You must have a net in there, too. We have a lot of nets. Simulators, golf instructors you name it, we have it. Think of it scale to size, probably 15 to 20 times the traditional golf specialty store. So these are big stores that offer a great line of service. And you can blank, he asked me what i need. As i walk in, someones directing me where i need to go. Thats important. Well, this is really the same thing as what we had at home depot. We separate ourselves because of customer service. And i think as mindy said earlier, its all about the experience and what we provide as arthur said is probably five times, ten times the normal store. And all this technology. We cannot only fit you for golf clubs and make sure youre getting the right golf clubs, but for a golf ball. Some people have a hard time understanding that. But based on how you swing, well fit you for golf balls. Thats the level of technology that we have to improve your game. That requires you to hit the way everything consistently, though. Thats the problem. You couldnt fit me because i would screw it up every time. Well give you a bigger golf club. Joe just wants to know which logo. Ive got to know which way the balls going to spin because i need to know if to work it left to right. Left right, left right, which way its headed. What is the whats in it for the pga tour . Youre allowed to call it pga tour golf . Yeah, we have a 50year license and we have a relationship all the way to the top. And in addition right now, we have 19 brick and mortar stores. Well have 50 stores by 2018. We are the worldwide provider ecommerce for the pga tour. We provide worldwide all of the purchases for the pga tour. Thats a terrific opportunity for us to grow our business beyond the growth of stores. Youre opening one in long island so we can go out and try it. But one of the questions i have is golf in general is declining by about 5 a year rounds played. Really . Yeah. Youve got this tee it forward. Trying to get more people involved in golfing. As you want to be a category killer and really dominate the dominate golf, how do you get people more involved in the game . I think the growth in the game has got to be key to the growth in the store. Its a great question. Since 2007, obviously weve talked a lot about it today, theres been a lot of things that have declined. We did see an uptick in 2012. An uptick in golf rounds in 2012. This year is actually some of it has to do with weather. We have seen the decline. It is so important where the decline has become is between the 18 and 34yearold kids. The older segment is still playing as much golf as they were playing back in the 2000s. The amount of golf courses, obviously, in the 90s and 2000s were growing at an incredible pace. Its important for us to make it easier, make it more affordable. And the things were doing at retail. And its time. Its money, its time and its difficult. Two of those elements we can provide at our store by providing better equipment. We gave over 10,000 golf lessons in our stores last year. Best to have a wife that plays and kids that play. Were going to try and get through the economy, a little politics and maybe a little football if we can. How do you see the economy right now . Me . I think its getting better. I think its improving. I think its been a very slow emerging, obviously, you know, since 2008. But i would say even in golf its getting better. But it is it is slow. And i think the consumers mind has changed for the foreseeable future. I think a lot of the orientation towards value. I think at every level of retail, you have to fight harder today for dollars. We certainly see that at home depot they certainly see that. Theyve had Great Success and incredibly proud of the job frank blake continues to do. But the business is there. We are rolling up golf retailing in america today. Well double in size every three years. So were thrilled about where we are. But we have to fight hard for the dollars today. And ive needled you before. It wouldnt be the first time. I know. Ken langone, bernie marcus, and you. What were you . The token liberal democrat. Are you still a democrat, arthur . I think i was. Are you still . Well, i you know what, im somewhat balanced, actually. Really depends on the issues. People sometimes if they wanted to characterize me, they will that way. I think it depends on the issues. I tend to be more liberal socially. Not grabbing it with both hands anymore. Well, i am, sort of, it depends on the individual. Well, it depends on the issue and the person. But i think socially im more liberal and financially probably more conservative. Stick to your guns. I am. Bernie and ken arent going to change, thats for sure. They havent changed. And, you know, this is the only time ive been on your show. Actually this is the anniversary, two years ago i was on your show for the first time. Two years ago today. I remember talking about that. I dont have ken and bernie yelling at me. I know, they were slapping you down. Who do you think its so weird, isnt it . Denver gets beat by san diego. Youve got to play every week. Who looks really good . The top four . Who do you think . Well, i think the top two. I think the top four on the afc side. I like new england. And i like the broncos. On the nfc side, i like seattle. And i think the 49ers are going to be there at the end, as well. If i had to pick a top two, which is really tough to pick, i would probably go with the broncos. I think peyton has had a hot hand all yearlong. My guess is probably playing against seattle. Seattles got a great defense and a young quarterback who knows how to move the ball. Are you going to andrew can set you up with long underwear if you want to come to the super bowl. Well be at the super bowl. Yes, were going to be there. Not sure were going to stay for the game. Its interesting, all the owners, we have meetings during that week and parties and things of that nature. And then on sunday, on sunday if youre not playing in the game, youre not so sure you want to be there. But im from new york originally, i love new york. Should stop in here before the game and come on if youre in town. Maybe maybe you know someone who has got one of those private boxes. Do you know anybody up here in the new york area . Well, we actually have a suite for the game. If we do stay for the game your commercial flight up here in coach, maybe you can bribe someone to let you in one of their boxes. We can give him some hot cocoa. Hes a democrat. You know what happens come up in your lib jet. Just because ken and bernie are not on with me doesnt mean you have free shot at me, does it . Maybe it does, i dont know. Becky, youve got to help me. Arthur, youve got to come in the studio, then you can hold your own right here. Youre right, i can. I appreciate you offering that. Hes in studio, i wouldnt do it. Id be too afraid. Anyway, guys, thanks. And i want to go is there wheres my closest one . One here. Down the street here. Yeah, i do know that. And wesbury opens on saturday. Got to open one in west chester. Were looking up there, as well. Dick sullivan, thank you. And arthur, well see you at super bowl time if you get in up here. Thanks for playing along, i appreciate it. Thanks, andrew. Well leave the lights on for you if you ever want to thank you. I appreciate that. And hot cocoa. Hes talking about his big tent. Yeah, my big tent. We do have much more squawk box ahead. Including the word from the floor with jim cramer. And join me this sunday evening at 7 30 p. M. Eastern time here on cnbc. Ill be hosting on the money. Check your local listing. Squawk box will be right back. X and pay one flat rate. I didnt know the coal thing was real. Its very real. David rivera. Rivera, david. [ male announcer ] fedex one rate. Simple, flat rate shipping with the reliability of fedex. [ male announcer ] fedex one rate. 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Welcome back to squawk box, everyone. The futures are indicated higher. They had been up by 40 points above fair value. This, again, is coming after three days of declines for the dow. It is friday is a tapeer on its way . We get you ready for a fed decision later in the week. Squawk box on cnbc, profit from it. Hing daves always wanted to do when he retires keep working, but for himself. So as his financial advisor, i took a look at everything he has. The 401 k . Insurance policies. Even money hes invested elsewhere. Were building a Retirement Plan to help him launch a second career. Daves flight school. Go dave. When people talk, great things can happen. So start a conversation with an advisor whos fully invested in you. Wells fargo advisors. Together well go far. Every day were working to be an Even Better Company and to keep our commitments. And weve made a big commitment to america. Bp supports nearly 250,000 jobs here. Through all of our energy operations, we invest more in the u. S. Than any other place in the world. In fact, weve invested over 55 billion here in the last five years making bp americas Largest Energy investor. Our commitment has never been stronger. About qualcomm 15 years ago. Thats going to put 100 in there. Right, jim . Wahl, i mean, qualcomms charms. If you remember even the last quarter they didnt have good things to say. It doesnt matter. The eye growth guys cannot stay away from qualcomm. Theyre looking at 4g, it doesnt matter. It is an anointed stock for 2014. It kind of aggravating, i think. Yeah. Interesting the way its working. I guess you got to consider that paul jacobs probably grew up with that company around him all the time. 51 is okay to beat, chairman, dont you think, if you need to keep this other guy, if someones going to steal him . I said theres got to be some nfl team that can buy him, right . Once you got a stadium, why do you still want to go into work every day as i dont know. Have you made a bid on philadelphia stadium, tim . Jim . No, t rk, i have no. Sunday night they flexed us, which means every kid you were going to take to the game you have to say, hey, listen, sorry. You have to get a whole new group of people to go. Who do they play . We play the bears pipts going to be a really good game. Both teams need to win. Theres a lot of teams that it really doesnt matter right now. Theyre playing. I know what arthur was saying about the niners and seattle. Seattle is the best team out there but i think the team that no one wants to play right now is the eagles. Were going to have russell on here one of these days. We have a connection there. Would you really . Guest host. I agree. Thanks, jim. Well see you in a few minutes. When we come back, we have a retail roundup with former sachs chairman and ceo scott sadove. Stick around. Uh, mark . Go get help i have my reasons. Look, you dont have to feel trapped with our raise your rate cd. If our rate on this cd goes up, yours can too. Oh that sounds nice. Dont feel trapped with the ally raise your rate cd. Ally bank. Your money needs an ally. All right, lets get back to our guest host, steve sadove. Steve, what do you think . Holiday season, is it going to be good . Bad. What would you grade this . I think its going to be a b to a c. The consumer is going to be out there shopping. Theyre going to get a lot of great deals. Theres going to be inventory in the system thats going to need to be promoted so the customer will find great deals at the end. If the customer is finding great deals and theyre seeing the sales come through, that doesnt necessarily mean great news for the retailers. Thats why youre seeing early warnings that come down. I dont think you expect to see great earnings numbers out of the Fourth Quarter. But its going to be margin pressure. Do you want to talk about the turn around or not . You havent talked about it. Youre on the board. I joined the board about four weeks ago. I think mike ullman and his people are in the middle of one of the great turn arounds that have to go on. The company was really beat up, went through a terrible period during that year and a half, ron johnson run. What can jcpenney be . Two are three years from now if were back here talking about it, what is it . I think theres a spot in between a kohls and macys for jcpenney. I think its about value, differentiatation. What jcpenney has to do is get back on track and show it can provide those. Happy friday the 13th, everybody. Its fine, its good. Squawk on the street begins right now. Good morning and welcome to squawk on the street. Im david faber with jim cramer. Were live from the new york stock exchange. Carl quintanilla has a wellearned day off. Take a look at the futures here. Well see if we can actually end up on this friday the 13th. Turn to my colleague makes a face. You cant see it. Turn to the 10year now. Where we been . Right around the 2. 8 mark, there we are,