Acres and continues to rage. The cooler temperatures and light rain have officials feeling more optimistic they may get a handle on the devastation in the oil stands region. More than 80,000 people have been evacuated in Fort Mcmurray. Officials say theres no timeline to return residents to the city. Its a pretty horrible devastation thats taken place there. Homes have been lost. But again, people evacuated and are out of the way. Oil prices are reacting as the wildfire has knocked out a Million Barrels as a result of the fire. Bp and oil firms warn they cannot deliver on certain contracts. Wti is up over a dollar gaining 2. 25 . And more big news over the weekend. Saudi arabia replacing longtime oil minister ali alnaimi with Khalid Alfalih, chairman of aramco. They are planning a threeway listing in london, hong kong and new york. The company is valued at more than 2 trillion. John kilduff is here with us. We have gotten so used to this guy, i thought it was an aappointment for life. Right . Well, it was pretty close. He was 80. What happened . He was unceremoniously dumped. I think this is a consolidation of power by the saudi prince. Now a 30yearold is put in charge of the economy in the kingdom. What got him in a lesser light with this 30yearold, do you think . What did he miscalculate on . I thought the saudis did exactly what they wanted to do to try to put our lowcost producers or highcost producers compared to them out of business . Well, i think he ran afoul of them with the doha meeting, that was the final straw. Naimi wanted to strike the deal and give iran a pass now, let them come back up to the previous production levels. The home office would have none of it. And thats why the meeting fell apart at the last minute. If you recall, they went in, they thought there was going to be a deal and there wasnt because the saudis at the last minute wouldnt give iran the room to go back up to their presanctions. Didnt he walk in not knowing that . Was he operating it seemed like the rug got pulled out of him going to the meeting upon his arrival. Hes the old guard, joe. I think what we have been seeing more and more of out of saudi arabia, like in yemen and other parts of the region and more active fighting against iran and russia and syria, youre going to see a much more robust saudi arabia going forward. No question about it. Sort of the same way the israelis take care of business on their own. The saudis arent going to wait for us to carry the water any longer. Youre going to see more of the action, direct action on their part going forward. Its going to make a lot more volatility going forward. Theres going to be no change in their aggressive output policy for the moment. As a matter of fact, come summer here when the saudis directly burn crude oil to meet their electricity command for the airconditioning they need, they will ramp up production to a Million Barrels a day. Theyll hit 11 Million Barrels per day come summer here to upset the market again. Im going to miss this guy. This guy was always in vienna and the western journalists were chasing him. And he always had some sort of trite answers to a lot of things. And the last meeting he had, i call it the smirk in the market, when you would ask him about any kind of question or is there going to be freeze deal . He would give you a smirk, yeah, of course there is. What does this mean for the oil markets overall . Its up by 2. 25 today, more so because of the fire in alberta . We have lost a Million Barrels per day in production. Thats definitely supportive. Its a big loss. But the markets going to have its eye on the aggressive saudi policy to squeeze everybody out including the iranians and try to break the back, which they were succeeding in doing in terms of the Shell Production here for sure. But beyond that, you know, again, its going to be much more interventionist saudi arabia. Alnaimi let business get taken care of in a smooth sort of way. Let the u. S. Do most of the heavy lifting in the region. Sort of the policy that president obama has been arguing for that they need to do more of their own lifting in the region. I think that is going to come to pass here with this new guard in saudi arabia. So a new generation of millenials. Definitely. The crown prince is only 30 years old about. There, too. Very aggressive. Very, very aggressive. They dont know what theyre doing, do they . Experience and all that, is he on snapchat . They have a twitter feed you cant believe. When you put the star on there it pops up into your feed. The world is passing us by. The world is in trouble. If they are not going to cut back then, is your return to 30 a possibility . I mean, its been at 60 to 70 , do you think its going to be a test to where we were . I do. The market guys and economists, im not liking what i see in japan. I did not like the manufacturing data that came out last week. Youre talking from the demand side. Yeah, the chinese action overnight the last two days has been terrible. The market needs the demand center. We immediate the asian demand center to come back here for the prices to be sustained. With the saudis stepping up production here and the iranians as well, everybody thought the iranians wouldnt come back as fast as they have. I told you guys they would and they are upping production a Million Barrels per day since the sanction has been lift in a few short months and theres more of that to come. Theres a market share war that will play itself out. This is not forever. But its for now for sure. John kildu ff, thank you. No data today. Tomorrow look for wholesale trade. Then thursday weekly jobless claims and april import prices. On friday its the april retail sales, the Producer Price index and the may Consumer Sentiment. The face of earnings slows this week. The big highlights are disney tomorrow. As well as a host of retail names this week including macys, kohls and jcpenney. Well check on the markets this morning, the futures are indicated up a little bit. Pretty good day on friday but not a great week. Up 41 now on the day. Indicated up 6 on the s p 500. 16 on the nasdaq. The tenyear still not a lot happening there at 1. 78. The dollar was once again i think the yen was back to 1. 08 in euro below 1. 14. Now the latest concern in the wall street journal is the concern for the weak link in all the recent recoveries around the world, its now a weak dollar. Now we worry about the weak dollar. Youve got to be kidding. No, im not. Its right there on the front page. The dollar is too strong, oh, my gosh. The dollar is too weak. Investors are worried that a falling dollar could prove to be the weak link in the rally in stocks. Make up our mind. What do we want . We are never happy. Sounds like seinfeld. We are never happy. Weak, strong, we need a perfect dollar just like the perfect weather. 70, sunny. Just right. 73 and i think we are going to hit that today. Finally. Joining you to get you ready for the week, we have the chief u. S. Equity strategist and deutsche banks chief u. S. Economist and cnbc contributor. Guys, thank you for being here today. Thank you. Why dont we pick up where we just leftoff with john. Hes concerned about demand and what is happening right now, especially from asia. Joe, you have concerns yourself. Absolutely. Just look at the u. S. , we grew. 50 First Quarter. In nominal terms, we are under 3 nominal growth year on year. And its a pretty weak u. S. Backdrop let alone asia. In this kind of environment, i would think the demand for sensitive materials and a lot of cyclical factors is actually quite low. We are entering a very let stage in the business. So things are looking tired as far as im concerned. The jobs report was weaker than expected. If you look cumulatively, you are looking at pretty good numbers. The job growth is under 200,000. If you look at the tax results, they are soft. The numbers are weaker than they show. This explains why the consumer is so soft. We had 3 nominal retail growth sales since oil prices peaked. Thats a very weak number and it shows you the u. S. Consumer is not as strong as you might think. And that the economy should be doing better and is not and theres a fundamental problem there. Tobias, that is something the market has been gras upppling w all year. When you talk about the weak dollar, we were upset about the strong dollar and now are nervous about the weak dollar. We seem to kind of react every time theres a wiggle one way or the other. And all these numbers eventually get readjusted every two years. Then we look back and say, what were we worried about . So there is this tenuous stint amongst investors, not a love f of the market gyrates with this. Its not all that surprising. We track the Investor Sentiment very carefully. We were panicked before. We are deep in panic again suggesting a 97 probability of markets higher a year from now. Say that again, based on Consumer Sentiment there are nine factors in the model that we build to measure not how people feel as my wife will attest to, i dont care, but its more about how theyre positioned. And they are positioned tenuously. So over the course of the next year, 97 project of making money. Over the next year or two is a different story. When you think about where people are headed, earnings have not been that strong although we are at historically high levels in terms of profitable. But what joe said concerned me, the tax receipts are soft. Thats real numbers. Sure. A year ago when the numbers on labor were weaker, the taxes were stronger. So again, i wonder about all of this data because it gets readjusted. You make a very good point about adjustments when looking at tax receipts because they dont get revised. But what we also learned last summer is post youre not talking about decline. Growth less than 3. In other words, we have not had 3 gdp growth in over ten years. So youre right, the revisions are important. Sometimes we have the full picture of the outlook, but this is the economy that has to pay out of its own way, both in the gdp and gdp per capita basis. You can see the markets. For the market, i guess they are looking at this and not expecting any chance the fed is going to raise rates in february or in june, especially after the numbers we just got on friday. Our guys dont think they are going to raise. Is that a good thing or a bad thing . Great, were still going to be looking at east money or do we think this is bad news because things are worse than we thought . In my opinion i would rather see the people seeing jobs and feeling good about the future. Its not a bad thing to raise rates for good Economic Growth reasons. If we are really late in the cycle, theres inflation soaring and the fed trying to cut it off, then we worry about the markets. But you would still be telling people to put the money to work here because the odds are the market will go up. In the market on the s p, that was my target for june. I called my boss to say, can i take the next two months off . He actually didnt respond. But yearend, we hit 2050. We do see the up side. Its more moderate. In a low return environment, if you can make 7 on next years equities, thats not so bad. Gentlemen, thank you both for being here today. Thank you. Coming up, gop candidate donald trump signing off yesterday on meet the press. Ben white will join us next to talk about taxes, minimum wage and trumps relationship with House Speaker paul ryan. The first stock index was created over 100 years ago as a benchmark for average. Yet many people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Its time to bench the benchmarks. Greeces parliament vowed to pass new austerity measures overhauling pensions and increasing taxes. Or even levying taxes might be an idea in greece. The vote came amid strikes and demonstrations on sunday. Some protesters through molotav cocktails. The eurozone finance ministers are meeting in brussels today to discuss greeces fiscal strategy. Old things are new, new things are old. Here we are back to austerity measures in greece again. And back in the u. S. Many residents in the midwest are cleaning up this morning after a severe storm and tornadoes ripped through a wide area over the weekend. This tornado was caught on camera in central high, oklahoma. An area hit with heavy rains and hail, golf ball sized hail. Move, guys. You lived there. No, move, guys. Youre right in the path of a tornado. Storm chasers are crazy. Captain American Civil War soared in the box office this week. The Disney Marvel movie grossed 181 million this weekend. In the action flick, captain america played by chris evans flashes with ironman for a superhero somehow down. Donald trump and paul run are set to meet on capitol hill later this week. The House Speaker says hes not ready to support mr. Trump. Responding to ryans comments on nbcs meet the press, here he was. I like paul ryan. I think hes a very good guy. He called me three weeks ago and was very supportive, it was amazing. So youre stunned. You feel blindsided by him . No, i would say stunned is a little bit its politics, im never stunned by anything that happens in politics. So im not yeah, i was blindsided because he spoke to me three weeks ago and it was a nice, encouraging call. Joining me, ben white, politico chief economic correspondent. Also a cnbc contributor. When are you here and when are you in d. C. Getting indoctrinated . Im all places all times. Im usually here but in d. C. For events. I like to get out of the beltway such as i can. Out of the beltway into manhattan. Such a real feel out here. I get out into the country to talk to people on the campaign trail. I do, actually, get outside the bubble. I dont know what happened with paul ryan, it could be that he just wants to talk about tone and other things. Is that what you expect on thursday to come out, do you think they come out i dont know they do. I dont know it will be that quick that ryan embraces trump as the nominee. One thing about that, after trump said he had this call with paul ryan where ryan was so supportive, ryan said that call never happened. But then Trumps Office came back to say the timing may have been off, but the call did happen. I dont know. But ryan is pushing back hard on the idea that he made it clear he was going to support trump. Anyway, for this meeting, its partly about tone and partly about how do you not alienate latinos . How do you not alienate africanamericans, women, all the constituencies is the down market worried about congress and the senate . They are worried about congress and the senate. Ryan is worried about his longterm viability as a candidate. If he endorses trump strongly, he goes on to lose badly, youre not convinced he will, but if he does thats not good for ryan longterm. Hes the nominee of the party. Paul ryan is hitting up the convention, this is the nominee, you know, you still hear its only 40 . Its only a plurality of republicans you cant discount how powerful he was in the primaries. Absolutely true. You cant discount its the perception of the party bosses, almost pharisees to take their ball and go home. Jeb bush signed that pledge and it just with the assumption it wouldnt be trump and it is trump. There was no footnote that said if it was trump this doesnt one more thing about the meeting with ryan, if i could, it will be about taxes and trade. Because trump he said on meet the press he might want to raise taxes on the wealthy. Thats what you people wanted. Thats what you people have wanted all along you say we cant do everybody said look, everybody says that its its not free trade. But fixing things will take spending cuts im not going to admit it. Finally the republican candidate says it and youre not happy you said it. Youre saying you, its not me. Traditionally republican candidates are im interesting to hear that we have Grover Norquist here. You saw the part about the business taxes where chuck todd, trump said, they might actually have to be higher. Trump said, higher . Im negotiating with the actual democrats. He could also be talking about overall broad anything the base of corporate taxes while lowering the rate. You can rid of a lot of these i take issue with that. Hes moving into the general election as well, which he should be happy about. I dont take a position. Im just saying what ryan wants to know is i dont either. Is he a republican or is he a democrat . Is he for lower taxes and free trade . He made the point that its not the party, its not the conservative party. There are shifts in both parties where things are more fluid than they have been. Traditionally ive been in the conservative party. Its also about principles. We saw where prince iples get y when you go against a president all about politics. When youre about principles, youre going into the fight with a knife, which the republicans have done. This guy is nothing with principles. Watch how he was reelected the first time, its all about politics. Suddenly we have bill crystal coming on, master of principles. Lets get mitt romney a run as a third party. Now that is brilliant. Thats a brilliant, brilliant move with 40 of the people already if you do that, youll be handing it to Hillary Clinton. I think what trump is talking be about makes common sense but i understand people who feel this is not a candidate who agrees with the things i agree with. So i cant support him. Did you read what bobby jindal said . Im going to ask cristol, go ahead and endorse hillary. Maybe it wont be so bad. Maybe he would rather adhere to your conservetive beliefs and not what trump has. What have they been able to do . What have they been able to balk . Ill explain it to you. What do you think caused the rise of trump . Because they promised to get rid of obamacare. They promised to stand up to obama on all these things. None of that happened. People are upset. Thats understandable. And that is why trump is so popular. Because the elite has failed. They have failed. Could you ever see on the other side a large part of the democratic, you know, not supporting the candidate . All of a sudden she took on principles of the other party no way. If she were not raising the minimum wage i dont know that the bernie supporters will all go along. You want to bet . Bernie last night if bernie was the nominee, do you think all the people would fall in line . How can trump remove paul ryan from the does he have the capability . I know the answer to that, he could work for it at the rules committee before the convention starts, he could put forward a motion to have somebody else run the convention. I dont think ryan wants to be in a position to try to tinker with things once he gets there. Even if he doesnt personally agree with him. If he says paul ryan, i dont want you to run the convention if it is donald trump, because hes for free trade and lower taxes across the board. It would be crazy to tinker with the rules once he got there. Is it by definition the speaker gets to do that . What are the parliamentary procedures for getting rid of him . You saw the sarah palin comment. I dont know how productive that is. This is a guy who is the face of the Republican Party in congress and hes all of a sudden hes a pariah among the rank in file republicans. I dont think so. It depends if you are on abc and now there are four Supreme Court nominations coming up in the next term. If you trust to make those if youre a conservative, i dont know that you do. You have to choose between trump and hillary. You have to choose between trump and hillary. And i know one stands on principle and says this is not my republican conservative. Then you are electing hillary. Then endorse her. Okay. I think some of the republicans will make that decision that they would rather lose an election than lose their soul. You already lost two elections standing on principle. And you see where we are right now. Maybe you can somehow yunite the two elites. In this election . No. Part of the elite ends in the Republican Party and paul ryan might be in a position to do that himself. That might have something to do with it. Theres no question. Ben, thank you, great to see you. You, too. When we come back, a key test for the art world. There was an auction last night entitled bound to fail. But that had more to do with the success. Well explain that coming up. Now well look at the s p 500s winners and losers from last week. This is lulu, our newest dog. Mom didnt want another dog. She said its too much work. Lulus hair just floats. Uhh help me doorbell mom, check this out. Wow. Swiffer sweeper, and dusters. This is what im talking about. Look at that. Sticks to this better than it sticks to lulu. Thats your hair lulu mom, can we have another dog . laughing trap and lock up to 4x more dirt, dust and hair than the store brand stop cleaning. Start swiffer ing welcome back to squawk box on cnbc, first in business worldwide. U. S. Equity futures at this hour continue to show some positive gains up 50 points, above 50 on the dow jones up 6. 75. And take a look at the price of crude. If we want it to go up now, i dont know what causes this. Maybe 45 is a sweet spot. 45 sounds good for equity prices. I dont know what we want on the dollar, either. The dollar is a little stronger today. I think i would rather see slightly weaker dollar because it threw us into such turmoil for over a year. But in general, no society, our country has never done well based on currency. You dont want to be the only strong one there standing. And we are still relatively speaking. Well never get a its all relative. Parody. Its all relative. But in general, a strong currency implies that youve got a Strong Economy and that assets are coming up. That goes back to make me strong but not just yet. We can base our currency, cut the dollar in half like china, but thats not our thing. Its not our thing. We need a strong dollar. Right now its time for the executive edge. The spring auction season has begun. Christies bound to fail sail kicked off last night and many are viewing it as the biggest test of the art world since the markets went into turmoil in january. Robert frank is here with the latest. Christies bound to fail sale last night totaling 78 million. That was actually the highend of expectations. All but one of the 39 offerings sold. Art experts say this shows the market may not be as bad as some feared but the expectations very low for this auction season. The auctions totaleded 2. 7 billion last may. This year well be lucky to reach half that. Remember picasso sold for 179 million. The top lots are selling for only 40. The auction houses are pulling back on guarantees to pay the sellers a set price regardless of the auction results. Last year they guaranteed more than 100 works. This year its less than 30. The top sales last night were jeff koons one ball total equalibrium that went for 78 million. And the whacked sculpture of hitler kneeling in prayer went for 17. 2 million, well above its 15 million estimate. Why do they call it the bound to fail sale . Well, they said its to challenge notions of commercial success to put out artists that really took risks. But it was also a sign to the market basically saying, you know, we know this is going to be a tough season. So you cant make fun of us because weve already said this will fail. And were going to underpromise and over deliver. Thats the theme where expectations are so low that they are probably going to exceed the expectations. As we pointed out at the top, the art market went haywire in january when the markets took a dive. What would you say, what is your gauge of where it is headed right now . We didnt get a measure of the market in january so this season is so crucial, its the first time we can read the market post the First Quarter turmoil. And, you know, you look at it compared to last may, last may, 2. 7 billion, you had eight pieces last may sell for over 50 million. This one that could sell for 40 million wouldnt make the top ten last spring. So its a totally different market. It is corrected, it is smaller, but its still fine. For collectors out there, this is a much better auction season than last spring. Do people in the art world talk about the fed like we do . Because the idea of this free money essentially, i would think thats one of the things really boosting prices. They do. They talk about the fed, oil, they talk about china, the global liquidity and asset prices. Its all correlated. A lot of these guys, the seller of this was david gannick, a lot of the guys are in finance so they live and breathe from the markets. And there are a lot of overseas bidders where global lick wequi and assets are all the same. So its just a more quiet market. All right. Again, better for buyers. Right. Robert, thank you. Thank you, guys. When we come back, a break through in biotech. Gene companies are looking into a new way to fight cancer. And a quick check on the european markets right now. The green arrows are out there. The dax is down nearly 2 . Squawk will be right back. In a world held back by compromise, businesses need the agility to do one thing another. Only at t has the network, people, and partners to help companies be. Local global. Open secure. Because no one knows like at t. At ally bank, no branches equals great rates. Its a fact. Kind of like grandkids equals free tech support. Oh, look at you, so great to see you none of this works. Come on in. Im in vests and as a vested investor in vests, i invest with e trade, where investors can investigate and invest in vests. Or not in vests. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. Welcome back. Cellectis is the first treatment cleared to help fight leukemia. Joining us now, i think we had you on when the First Successful treatment was done. This is what is holding the company back from a large scale test of the technology . I mean, to do one a year and then it works, thats normally not the way we see Promising Technology develop. Why not do a large scale test . Well, we have found a Clinical Trial application in december 2015 for adult cues. Its the same one injected almost a near year ago for the first case of cellectis in complete remission. And there was a second case six months ago and was a 16monthold infant. We have produced enough doses to conduct not only the pediatric trial but also the adult trial. And you will see this large scale used that will be starting now. Nevertheless, when you have these being tried, it means theres a lot of demand for such product. Doctor, the other companies trying to develop something similar, with the only difference being that yours is kind of allogenic, meaning not necessarily from the person youre treating. The other technology, you take some immune cells from the person that are specific to that person and then do some whatever you do genetically and put those back in. And theres no immune response. Those people seem highly dubious that you can develop almost a generic cell thats not from the actual person youre treating without some time of immune response. And i can see why they think that because of, you know, you see when you do a antibody, if theres any mouse molecule left, you do see the immune response. Is one or the other Technology Going to be the one that finally happens using their own cells versus just using a generic cell . Well, when youre using your own cells, its not a therapeutic product, its a therapeutic procedure. And we definitely are seeing that there is a lot of success over the therapeutic procedure. Nevertheless, most of the patients cant get it, for those who underwent this protocol recently, we showed that they couldnt undergo the procedure and couldnt produce their own product. And the second thing is, of course, the immune response and rejection. And also the action of the cells, we have results that are approximately similar to the procedures but with a product off the shelf. Hard to imagine. How many people have been tested. Not for the therapeutic but for the ability to withstand the allogen allogenic tissue being grafted to them. It seems like you need a large study to show the side effects n other cases, the side effects could be severe. What have you done to mask the antigenic response in the host organism for this . Yes, like tcells cannot be used off the shelf for the simple reason is that they do react against the host. Its called the graft versus host disease. It means the graft will attack the host. What we have done is our gene it editing technology, we edit the gene Cell Technology so it cannot recognize the host as an aggression and wont attack the host. So it suppresses not totally but the side effect of the graft versus host disease. Not only this, but we can also through the Gene Editing Program the cell to be resistant to standard of care. In this case, the patient has been pretreated with an antibody treatment that could kill tcells. But our tcells have been gene edited and cannot react or are not susceptible to the antibody that was given to the patient before. Therefore, not only can it make the drug resistant to standard of care but also can make the drug not harmful to the patient and the side effect of this graft versus host disease disappear. Okay. So at this point the actual the cancer that youre trying to cure, is it just one type . How many different types of cancer could you theoretically use the allogenic tcells per . We strongly believe this therapy can expand for different cancers. From liquid to solid tumors, and cellectis is developing a large portfolio of large tumor product, but we have the intention with our partners, the pfizer solid targets also. So the next product that we are using this year will be a product against aml acute leukemia, another very rare form of cancer. In conjunction with cornell university, this will be working with other products. We are looking into other forms of b leukemias. For solid tumors, the hurdle is more difficult because it will require repetitive dosing. And this is where off the shelf tcell will be interesting. Because you can use it to shrink down the tumor, but also you can retune the tcells in order to be resistant to chemotherapy and maybe the chemotherapycan Work Together with the tcell therapy. So through gene therapy, the expansion of this technology is actually huge. Well, i hope so. And this is one of the great questions, and i know your competitors think you need to use something derived from the patient itself, but it would be a lot easier if you didnt have to. Good luck, doctor. I hope it is successful. But i guess we need large trials to figure that out. Thank you, appreciate it. Well, thank you. Appreciate it. Okay. When we come back, a bad moon rising for Department Stores. Courtney reagan will tell us why it could be a brutal spring for retailers. Well have the details, next. Actions speak louder. Something well show you. Through small things, big things, and spur of the moment things. Big things, you wont see these folks they have businesses to run. They have passions to pursue. How do they avoid trips to the post office . Stamps. Com mail letters, ship packages, all the services of the post office right on your computer. Get a 4 week trial, plus 100 in extras including postage and a digital scale. Go to stamps. Com tv and never go to the post office again. The average price of a gallon of gas jumped 9 . Attributing the rise in crude oil. Gasoline prices are now up 50 . Im sorry 50 cents in the last three months. And unlikely source of revenue for the transcription Security Administration the agency says its collected more than 765,000 in change. What . Left behind at Security Check points last year. Thats nearly 100,000 more than was collected the previous year. The tsa plans to expangd the Precheck Program because expedited pass through check points in exchange for some personal data and a fee. You take the change and forget you left it and walk off . Its got to be more than that. Its a big couch. Right. You go to one of those things. Yeah. I never have any change in my pockets. Thats men. Women dont carry change in their pockets. Thats money that is coming simply from men. It has been a rocky several quarters for Department Stores. Traffic has been sluggish. Diet piet millions of dollars invested improvements have been yet to be realized. Courtney reagan joins us. Good morning. Its not as if the last several quarters have been great for previous stand outs like macys and nordstrom. Many think something further happened in retail jc penney is pleased with the performances the First Quarter exciting the expectations. Still there is a lot of chatter that is starting. Retailers started slashing price s. Knowing if the parent of stall wart stronghold Victoria Secret and bath and body works faultered concern is mounting ahead of reports this week. Lowered earnings estimates for macys and kohls citing early signs of strength that faded by the quarters end. Rbc analyst laurvelged coverage of the Department Stores and notes that the 5 million spent on the group has an uncertain, if not unfavorable roi. We have a number of other notes from analysts today. Pretty negative ahead of the Department Store reports. We had joe with us earlier. Hes an economistest. Hes been watching the tax receipts and theyve been sub par. Last year we were tracking 6 growth and now tracking less than 3 growth. Definitely. Particularly, of course, this time of year. Thats something that will probably be hearing from walmart on. Perhaps more so than others. Theyll often talk about the tax and what it means for the particular quarter. Theres a lot going on that is not really positive for retail, unfortunately, right now. Courtney, thank you. Valeant is one stock to watch. The stock doesnt look cheap. Shares up about 15 from recent lows. But the article warns that the firm needs to wind down the use of adjusted earnings. Watch shares on the intercontinental exchange. The article says that the firms ceo built a successful conglomerate. Also, facebook winning a chinese trademark case against a company that was named facebook but the space in between. That Company Sells food and beverages. This court case in winning that case is a sign that attitudes may be softening toward the social networking site in china which has currently blocked chinas 700 million users. Coming up our next guest is chuck hagel. Hell talk politics, defense spending, and the fight against isis. We built our factories here because of a huge natural resource. Not the land. The water. Or power sources. Its the people. American workers. They build worldclass products. And that builds communities. And a better future. For all of us. Because making something in america means so much, to so many. Weathertech. Proudly made in america. Flip your way through your last 9 shows with the tap of a button. Change the way you experience tv. Xfinity x1. Crowd and the middle east in focus from the saudi Cabinet Reshuffle. Inside the region with former defense secretary chuck hagel. Our guest host for the hour. The effort to dump trump. Bill crystal meeting privately with mitt romney hoping to draft him for another independent candidate for the white house. Hell tell us why he indicate back mr. Trump. And drake dominating itunes. The staggering numbers straight ahead as the second hour of squawk box begins right now. Live from the beating heart of business. New york city. This is squawk box. Welcome back to squaux box on cnbc. First in business worldwide. Im becky quick along with joe. Andrew is off today. Weve been watching the futures and theyve been higher. Last week was a down week for the markets but the futures up this morning. In our headlines this morning, saudi arabia removed the longterm oil minister replaced by saudi arabia chairman khalid. Part of a sweeping government shake up over the weekend. Oil being impacted by the continuing canadian wild fire, at this point, cut more than a Million Barrels day from production. Well have more coming up. Take a look wti up by over 2 . A gain of almost a 1 to 45. 61. The recent increase in crude oil prices is pushing gasoline higher. The latest survey show gas prices are up 9 credibilients t two weeks. Apples google alphabets google unit and oracle are heading back to court today. It centers around oracles accusations that google used part of the software without permission. It has gone through courts throughout the last six years. Were taking a look how National Security issues are impacting your money. Joinings now not all is money, former defense secretary from 2013 to 2015 chuck hagel. Thank you. Its amazing that does come back to that time. Especially when youre talking about defense and how we fund it, how much we fund. It all comes back on what our role in the world needs to be. What it was in the past, what it seems to be now, and what is the, you know, right measure of moving into things that arent domestic. Have we put pulled back too much . Did we try to do too much in the last stretch and this administration not doing enough . What do you think . First, thank you for allowing me to come on. Thank you for being here. I think theres always a balance that a country, especially the United States, which is the only country in the world that can essentially referee and has leadership responsibilities. Not that we should be the worlds policeman or impose our will. We learned the hard way when we try to do that, but we have to be connected to the world because if, for no other reason, its clearly in our selfinterest. Economic prosperity is anchored by stability and security. And without stability and security, theres no confidence in markets. Theres no investment. You know how that flows. So our role must be predicated, of course, on our own interests, which every nation responds that way, but, also, i think on the larger scope of what we see as our responsibilities. I think this president ial election and this current political environment is going to, i hope, over the next six months start focussing on that. We havent had a real strong Intense National debate about how much does america want to invest around the world. Were seeing a new world order now being built. Post world war ii world order. I dont think america can retreat from that. I think we have to balance and adapt and adjust to the realities and the currents of the new world order. We have a clear interest in stable but its not just that the secure world leads to economic stability but also vice versa. You cant have one without the other. We seemed to have felt like we are superpower, maybe the last remaining superpower. Were also as a nation someone that does, i think, try to do the right thing. I guess you get argument in different parts of the world. We go in, get out, were looking for stability. We seem to be embarrassed about thinking of ourselves as guys wearing white hats or the good guys, and because we worry if other people think we really are or what do they think of us. But we really do provide a or can provide an incredible role in making the world a better place. I think if youre shy about that, but the american exceptional thing, if you dont believe it, then you cant really do it. You see what im saying . We need to be there and when were not theres a vacuum. Im not convinced that the russians arent necessarily. I know were going for our selfinterest but not the same way that putin goes for something for his selfinterest, is it . No. Its a different style. First, we are a nation of laws. We selfcorrect internally in peaceful ways. We dont have dictators. We have three coequal branchs of government. Thats where you start. I mean, russia isnt anywhere near that nor is china. In fact, most democracies dont really operate the same way we do. But they have to adapt to their own culture and history. But back to your bigger point, as an important point you make, ive often said that if america decides to forfeit its responsibilities that weve taken on since world war ii, i think theyve been worth. Weve made mistakes. Its imperfect, but then lets ask this question. The next great power will it use its power as judicially and benevolently as america has used its power . Even though we made mistakes and imposed ourselves, even though we struggle and stumble, we still do more for the good of the world. Yes, its our interest, but theres no country on earth that does as much for mankind as the United States does. Last point i would make on this, you talk about american exceptional ism. I believe that. But we dont need to tell everybody were exceptional. I think every country, everybody their families, backgrounding, religions, culture should be proud of that. They should be believe in that. We are who we are. I dont think we need to tell people how great we are. People know that. People count on us. I think thats why the world is paying so much attention to this president ial election. Is america going to retreat in the world . Right. Lets talk quickly about the iran deal which you backed. You saw this ben rhodes and controversy. A lot of people that already didnt like the deal, and this isnt going to help in terms of thinking once again theres a guy bragging about misleading the American Public to get something done. When you read that, is that the way you remember it going down . Well, i think there are two parts to your question. First, i did support it. I was there as secretary of defense and was involved in many security meetings when we structured a lot of the deal. I have supported it because essentially for two reasons. One, i think in any deal every deal is imperfect but does it get you closer to where you want to be. In this case, is iran, a nation without the capability to produce and use nuclear weapons. The issue of how do you do that . The regime, reagan said it best, trust but verify, i think that regime to enforce that in population. We have military options and other options if the iranians do not comply with the agreement. Thats number one. Number two, the ben rhodes piece in what he said. I was sorry to see ben say that because there was more to it than that. I think the larger scope of this administration in particular, but any administration, it seems to me as ive watched, ive been in three administrations over the years and the United States senate and i dont know anything more than else but had little experience is every administration tries to shape the optics with the press and with the people. This administration has done it in a more sophisticated way or attempted, i think with more emphasis than any ive seen. To say the things that ben said. I like ben and respect ben, but i dont think he needed to say that nor was that all true. Thats not how that deal was made. That deal was made because lets remember there were five other nations involved in this, too. And we were able to get russia, the chinese, the germans, the british, the United States, the iranians. Thats pretty good when you get all those players at the table and get a deal like this. Its imperfect. The other point i would make is i hear often we cant trust the iranians. No you cant trust the iranians. Thats the point. You couldnt trust the soviets either. Are your regimes Strong Enough to enforce the compliance . If you think they are, i think thats a smarter way to go than further enflame the middle east with another war. Part of the argument i heard at the time is we need to get through to the iranian people. They are suffering. These are people, for the most part, are pro american. The regime may not be but the average iranian is. But ive heard since then is that the sanctions that have been lifted have not held in terms of the economy. They are still suffering. So do we risk alienating people who might otherwise be looking at us more receptively. I think thats a important point. I dont think you can make a deal only on that. I believe theres something to that. We know through history through a cursory reading of history tells us that generational change is dominant in nations. We see it in our own country whether it was vietnam or whatever historic example. And there is an element in iran. We know that. That you identified it. I think we have to be mindful of and we want to try to help and support. We cant run that country. We cant manage it. Theyve got to deal with their own internal issues. But we shouldnt discount that, either. I dont think you can do your deal based on that. It is a powerful factor. I think its going to come in the right direction and its going to produce change, i believe, in iran. Do you think in ten years well be in a position that well think that . Well, i think that the possibilities are better with that option than the other. Something joe said earlier about america being on the right side. I think weve been on the right side, generally, in history. I mean, vietnam is an exception. I think invading iraq was a mistake. Probably libya, i think that was a mistake. But overall the big issues weve gotten right in this country. And, you know, we know about good intentions but the intentions of those other situations didnt turn out well, probably, it wasnt about economic or maybe it was. I dont know if thats thats the thing youre going to hear not just from our enemies thy i but even internally. I think at least my answer to that is we blunder into these situations because we havent asked the right questions. Then what happens . After Saddam Hussein who rules . Who is that decided . Who makes that decision . If you destabilize their government, which we did, we ripped apart their institutions and banned their functioning government and it worked. We didnt need to do that. We disbanded their army. We didnt need to do that. So youve got got to ask the questions before you go. In and the ultimate questions. They used to talk about the exit strategy . There is no blueprint. Its more complicated today than its ever been in the world. Its not just an easy, okay, here is our fivepoint plan. We get in and out. It never happens that way. You better have some good ideas about how youre going extra candidate yourself. Do you want to stay and impose your will and be the de facto government. Thats what happened to us. We have a similar situation, i think, in afghanistan after 15 years. Thats starting to unwind. The president is going to have to make some tough choices there. Were going to continue this conversation with defense secretary buy stocks or sell them . Buy america, buy all right. When we come back, the race for the white house. Why donald trump said hes open to raising taxes on the rich. Bill kristol will join us. Well talk trump. Take a look at the futures. It looks like the dow futures up by 46 points. Squawk box will be right back. Likely gop nominee donald trump spoke on meet the press this weekend about his lack of support from Republican Leaders and the possibility of raising taxes on the wealthy. I think nobody knows more about taxes than i do and income. I come up with the biggest tax cut by far of any candidate. Anybody. And i put it in. But that doesnt mean thats what were going to get. We have to negotiate. The thing im going to do is make sure the middle class gets good tax breaks. They have been shunned. The other thing im going to fight hard for business. For the wealthy, i think, frnkly, its going to go up and it should. And bill kristol is actively hunting for an alternative for mr. Trump. I know youre a principle guy, im going to tread lightly. Once you realize i know its a popullurality that trump rece with Republican Voters, and more than romney received, what spawned that 45 , i think, is Republican Party bosses talking down to the masses. They got tired of the principle stands where we had the past eight years where it resulted in gains for the other side. Here we are again where the party boss, with the brom mines decide this guy doesnt pass muster. He does with the 45 of the people he kicked 16 butts off that stage. Great candidates. So this is what these people did. Suddenly you hear, you know, that the brains behind the operation doesnt like this guy. Youre supposed to go with us. You get the ten smartest people. The public doesnt understand obamacare but we do. We got to do it. Were the smartest people in the room. So we dont need to really poll the nation. Thats what i think is youre trying to do here. The 45 are there for a reason and youre ignoring it again. Im not the smartest person in the room. I will say that. I under estimated donald trump. I agree with you there were legitimate frustrations and leadership in congress. He beat the other candidates fair and square. I dont think hes qualified to be. Because of his character and temperament and hes taken no serious position on issues. Before that he virtually call the for reputuating the National Debt. He doesnt know anything about national finances. Especially more on cnbc that should get more attention. Are we going to dom nominate a president talking about cavalierly. I was there. He said he wanted to restructure he wanted to go from what we have now and make it more longterm. As if treasury doesnt know how to issue longterm debt now. He doesnt know anything about national economics. Hes a semisuccessful businessman who has gone bankrupt four times. Does the Weekly Standard earn a profit that often . No. Okay. Youre im not. Somebody who goes bankrupt and we have not run Trump University which has taken gullible people. Thats not the case with donald trump. He has buildings all over the city. Yeah. But anyway. I dont think you can see him as a billionaire i guess. Im not saying im not saying you cant necessarily. Look you have a binary choice now. We dont need to have a binary choice. The system is set up to allow independent candidates on the ballot. There are many wellqualified people who cannot support Hillary Clinton or donald trump. Think of this, the republican speaker of the house who supported a republican in the election i cant yet to support donald trump. Romney cant support donald trump. That should give people pause. Whatever you think of george w. Bush, mitt romney, and paul ryan, they are serious people that care about the country. They say they cant support donald trump. It would be easier for them to say i support the republican nominee. If you think any of the bushes after the primary season are going to support him. I dont expect that. Plus, jeb bush signed something that didnt have a little footnote that said ill support anybody except donald trump. At the beginning of the campaign, he saw donald trump as what about signing something and giving your word to do it . I dont believe in he was so appalled by what he saw with donald trump. I dont know jeb bush that well. I didnt support jeb bush. I urged him not to run. But hes a man of good character. What he saw of donald trump up close of his character, i think, so repelled jeb bush and repelled a lot of other people they couldnt support trump. Its a free country but i think its a mistake. Before we came out i wanted to look up thor i the serenity. Read that a couple of times. If you think running mitt romney at this point is going to be a good thing for the Republican Party, i dont think youre looking at reality. Just for me. Okay, there are many other people than mitt romney who can be independent candidates. I would say can i say this the serenity prayer is nice, but god grant me the courage to change the things that cannot be changed even if its a long shot. Republicans are great are the falling back on principles and not governing. The democrats know about politics and theyre going to play you again and get four nominations on the Supreme Court because you might as well endorse Hillary Clinton. Endorse her. I dont want Hillary Clinton to be president of the United States. I dont want donald trump to be president of the United States. I dont think donald trump is qualified to be commander in chief of the United States. Do you think realistically speaking an independent candidate, a. , could win or, b. , do more damage . B. I think its hard predict those things. I dont think trump will beat hillary anyway. The republican primary electorate 42 or whatever probably would have done a lot, unfortunately, to increase Hillary Clintons chances of president being. The path to rickvictory is a lo shot. If you have a reasonable candidate who got momentum this would be a key. Imagine a debate stage where you have Hillary Clinton and donald trump, i think, at that point might be even more exposed than he is now. The young senator from nebraska eloquently spoke cant we do better . I think that can be a moment. An independent candidate. Trump is less prepared to be president than barack obama . I think barack obama has been a bad president. Well close i was thinki ini come kaz city conservative. They dive bombed donald trump is not our own navy. He won a lot of youre in denial again. Im not in denial. John f kennedy said sometimes Party Loyalty asks too much. You should think about that. One quick sentence. Over the weekend as we know, john mccain, former republican president ial nominee, said he believes theres a disconnect between Republican Party leadership and the voters. I think john mccain summed it up pretty well. Thats why were here now. Theres a huge disconnect. You have Vice President cheney, you have bush and add a bush, christie. But youre smarter. Did i say that . Than the other 45 . No. Yes, i think the 42 who voted for trump are wrong. Oh, you think obama in 08 politically they were wrong. You cant govern on principle. You have to govern on politics. You can govern on both. Good luck. Well see what happens. Thank you. Thank you very much. When we come back wild fires raging through alberta. Well get you caught up on the latest. As we head to break, take a look where oil is trading. Up 2 throughout much of the session. Now up by about 1. 45. Stick around squawk box will be right back. My name is fred and i carve heads out of cheese. Its not easy. I was once working on a bust of Shaquille Oneill in swiss. I havent worked in swiss since. Everyone called me crazy. Things really took off when i got my domain name headsofcheese. Com from godaddy and now theyre selling like hot cakes. Made of cheese. Got a crazy idea you think you can turn into a success . We know you can and weve got a domain for you. Go you. Godaddy. man that show. T to record woman now we have to wait forever to see it. jon bon jovi with directv, you dont. Ou see, weve got the power to turn back time. That show you missed, lets just go back and find. And lets go back and choose spicy instead of mild. And maybe reconsider having that second child. See, thats the power to turn back time. vo watch shows you forgot to record. Call 1800directv. As long as you love me, its alright bend me shape me, any way you want me. Shape the best sleep of your life. Sleep number beds with Sleepiq Technology adjust any way you want it. The bed that moves you. Only at a sleep number store. Welcome back, everybody. Among the stories front and center this morning. Were watching shares of real estate hcp this morning. The company which specializes in health carerelated real estate is spinning off the hcr manner care operation into a separately public traded. It specializes in nursing and assisted living properties. The ceo of online lending marketplace lending club resigned. He left the company after the board determined he had violated the Company Guidelines on Business Practices and disclosures. The companys president , scott san born, will serve as acting ceo. Chicago fed president Charlie Evans said the Congress Must do its part if the fed to normalize policy. He said the process could have been done sooner. A developing story out of canada impacting the oil markets. A massive wild fire consumed at least 400,000 acres and it continues to rage. The cooler temperatures and light rain have officials feeling more optimistic they may be able to get a handle on the countrys oil region. More than 80,000 people have been evacuated from Fort Mcmurray once known as the canadian oil boom town. The fire destroyed 1600 homes and buildings in the region. Officials say theres no time line to return residents to the city. Captain America Civil War soaring to the top of the box office this week. The disney and marvel movie grossed 181. 8 million this weekend. Captain america played by chris evans clashes with Robert Downey jr. s character iron man for a super hero show down. I dont get it. They should get along. No. Theres a reason for it. If you saw i didnt see the movie but if you see the previews its over a friendship and captain america is trying to protect a friend of his iron man is trying to take down. They can team up to defeat bad guys. Theres evil everywhere in the world. And is it a black and white world . Can you say that everything is absolute . Yeah. Its a good theory. But do you know we would be talking about captain america. My candidate for president. And i dont know much about it drake you probably know more than i do. I think hes pretty good hiphop star selling more than 1 million albums. The album is only available on apple itunes. Over the last year, drake hosted 20 episodes of the radio show on apple city. Using the platform to announce album release details and debut several songs including the hit hotline bling. Oh, yeah. I have no idea. If im going that route, im going to you know what i mean . No. I dont. My daughter is a drake fan. Former u. S. Defense secretary from 2013 to 2015 chuck hagel. You mentioned captain america is your candidate for president. Where do you come down in the election cycle . I said captain america is my candidate for president. Well, i think, first of all, we have to recognize just, as i noted, john mccain said over the weekend, theres a huge disconnect between the voters and political leadership. I think regardless of parties, across the board. Its interesting to me and trump referenced this yesterday, when he said the Republican Party is not the conservative party. Right. And the Republican Party that i joined many years ago that no longer exists it did listen to and had a number of points of view but not governed by an absolute ideology that the Republican Party is now governed by. Im absolutely right all the time. Youre absolutely wrong all the time. So well paralyze government. Its only the party that is governed by that ideology. Because theyre not in thats right. They dont govern everyone else. Even though they have congress. Theyve been able to do nothing. They lost two straight presidencies and ready to lose a third. What youre saying, i think, play out is revolution going on within the Republican Party, as far as the Republican Voters who identify themselves still as kind of republican or and thats going on. If were establishment leaders or party leaders, however you want to categorize it, to fight that is insane. They learned nothing over the last six months. Was i right with the serenity thing . They have to look at not only are they denying where we are, but theyre denying their cop ability and getting us to where we are. Am i hearing you argue with comprise at this point . Im arguing for pragmatism. You would think i would be totally outraged by raising taxes on the rich. Im not. Im not because thats bowls and simpson said its going to take revenue and cutting. All right. For a deal maker to acknowledge were going to talk to we cant see past to the old were seeing a new political order being built in the country. Just as were seeing a new world order being built. Thats what is going on here. I dont think you can go back and anchor everything to ideology. Cheney cannot well cheney is a pretty practical guy. Hes a very aid logically anchored. Guys like sessions or chris christie. I look at his views on things and thats going to help. Chris christie is probably going to for every h. W. Bush. Christie may be doing it because you dont think on thursday theyre going to emerge with some type of understanding . I dont know. I think paul ryan im surprised paul ryan still wants certain, you know, a certain understanding im surprised its played out as publicly it has to this point. I think youve got let it play out. My position the first question you asked is where am i . If i was still in the senate, i think the senators run for reelection are understandably nervous on how this is going to play out. Focus on your game. On your center race. But i think to take on at least so far is establish republican dom knee based on the votes hes won. And no one has come close to challenging him. I think to undo that. What the voters and people have said is this a republican that people the establishment . And its tone deaf. And its tone deaf. And you have to be careful here. And its condescending. Youre morally and intelligently superior and mcconnell said yes i am. Trump won and let him play it out. He may selfdestruct. If Hillary Clinton ends up as the first female president so be it. You dont need to be a conservative to take down your candidate because youre unhappy with the candidate. We havent governed in this country for years. We have a government locked in paralysis. People want trusted and confident leaders they have some faith in and confidence in. They want a government that is fair and works. I dont think thats too much to ask. Right. I think thats what they want. I dont think they care about the big c on your chest for conservative. They want to throw everybody out at this point. I think thats a lot. They feel they failed them. Were all on the sideline. Were on the sideline all the time but i know. Not if you cant govern. You have to govern. Right. You have to govern and do the political it is a surpricomprise. Democracies will only work if you comprise. Coming up Morgan Stanley talks deals in the outlook for the markets. Then defense secretary summit with William Cohen joins us for a mustsee conversation when squawk box returns. Why do so many businesses rely on the Us Postal Service . Because when they ship with us, their business becomes our business. Thats why we make more ecommerce deliveries to homes than anyone else in the country. Here, there, everywhere. United states Postal Service priority you welcome back. After a recordbreaking year for mergers and acquisitions. A slow down is striking. According to the Financial Consulting firm roughly 481 billion in deals has been cut short because of regulatory pressure. The amount hasnt been that high since the start of the financial crisis. Joining us now is robert somewhere kinler. Vice chairman of investment banking. What do you think is happening here . The situation where the regulators are getting tougher or businesses are getting more a awe dedication . We saw it with halliburton and baker hugs. Its been a tough regulatory environment. I know you were on the chevron board at one point, and there were definitely issues. They were trying to overbid chevron, and there was tremendous political issues around the Chinese Company buying a u. S. Company. That subsided a bit. Particularly in that case uni cal had no businesses in the u. S. But globally its very challenging. And in europe, china to get deals done and the u. S. Its not just halliburton. There were other deals like cisco, u. S. Foods. You said you were surprised that hall burrton and baker hughes were trying to put it together because of the regulatory scrutiny. In this regulatory environment, the concept of trying to put that kind of deal together was a bit hard to imagine. Of course, you have been talking about election cycles. You know, historically if you did end up with a republican administration, if you did, most people would view it as a more favorable environment. And whether or not its a republican or new administration i think people think it will get better. Thats part of why the deals are lower now. I think people are just waiting for a change in sentiment in washington. In terms of areas where you think its really been a freeze. Are these particular areas or across the board . Part of it, becky, is search comparing it to last year. You know, last year was the biggest imminent year in history. It was driven by many large deals. So to compare it to last year is probably not a fair comparison. Last year was the same regulatory structure in the United States and around much of the globe. I think its beyond regulatory. I think theres a lot of reasons why m a slowed down. A lot of reasons why it was high last year. Last year it was driven by very, very large deals. This year not so much. Theres still a lot of activity going on. Youre at the highest echelons of wall street. Thats why youre here. We love when you come on. The latest is that Hillary Clinton is getting a lot of funds from wall street now. I think were in this weird place with hillary its like shes saying stuff similar to bernie but the way she governed would be way over here and she knows wall street then you have the republican candidate who is saying some republican things but wall street is worried he would be over here. We dont know who anyone is. They are both wolves in sheeps clothing. Who would be friendlier to business . I actually either would be friendlier than the current administration. Its not a political statement. What you said about why deals arent getting done. Whatever we get is going to be better than what we have now. I think to put in context not just a great year last year. The beginning of this year there was a lot of volatility in the market. Right. Are you going to which would be better . Yes. Shes not what shes saying and were sure hes not saying theyre both better. All right. Thank you, robert. William cohen will join us. Isis, National Security, and what the next president needs to focus on when they take office. The futures still up. Even after all these discussions. Welcome back. Greeces parliament voted to pass new austerity measures to increase taxes. The vote came amid strikes and demonstrations on sunday. Some of the protesters threw molotov cocktails at the police. Lowering pension cost is a condition for the greek government to qualify for a fresh installment of an international bailout. Its something that the imf said it would not involved without. European ministers are discussing greeces fiscal strategy today. When we return this morning, a defense secretary summit. At the top of the hour reaction to the saudi reshuffle. Stan jurgen will be here. The oil prices were up over 2. 2 earlier this morning. Still a gain of 42 cents. Squawk box will be right back. Andrea sikon. Medical doctor from cleveland clinic, watson, lets review the Electronic Medical record of the next patient. No problem. Its a pretty huge file. Done. Sorry for the wait. That was quick. As part of our research, i also compared lab results with notes about prior treatments, then cross referenced it with thousands of medical journals. And i get the benefit of much more data, and a lot more time to plan the best treatments. I stay focused 24 7 and never sleep. You sound like a lot of medical students i know. Welcome back. According to a recent pugh poll 35 of americans actually favor increased defense spending. Thats the highest level of support since the attacks on september 11th. Defense secretary ash carter sounding off that congress hasnt passed a defense appropriations bill for on time for the last seven years. Joining us now is former u. S. Defense secretary under president clinton William Cohen and our guest host former u. S. Defense secretary chuck hagel with us. Defense secretary cohen, thank you for joining us. What do you think about the state of our defense at this point and whether or not we need more funds . For me its not been a question of how much we spend but how we spend it. I think the military has been severely impacted in the last few years beginning with the time that senator hagel or secretary hagel had to take over the job at the pentagon we had across the board cuts imposed by the sequester rule. I think that was very damaging to our military. I think we still havent recovered from those across the board cuts. I think that secretary carter is making the right decision and recommendation we have to do more if we are going to meet our requirements that have been set forth by the pentagon. Secretary hagel, we spoke recently and they said sequestration weve done everything. What is the smart way . First, we have to sequestration is the law of the land. What bill just said i agree with. I was the first secretary to have to deal with that. I walked into office five days later. The chief defense came in and said we have a problem sequestration no one believed what happened. There was no budget. And, also, a few months later the government shut down for 16 days. What did you do . How do you fix that . You adapt and adjust. Bill and i have talked about it. We had to stop training for all of our services, which was devastating. Because the readiness to force is key to anything. We had to defer all maintenance. We had to defer additional platform purchases for contracts. It threw off the entire budgeting schedule. The pentagon is the largest entity in the world. You need the five or ten year planning. And you need some certainty of what your budget is going to be and at the same time, and bill referred to this, the American People threw their congress and threw their president asking the pentagon to do more in a far more complicated world in anything weve seen. Things cant add up here. Something is going to break. And the pentagon came close to breaking in many ways. Theres a lot of money, tremendous people, great commitment, so the American People were not in danger of losing their National Security. But for the longterm consequences, weve got to Pay Attention to this. And bill mentioned it and ive had conversations with bill cohen, other former predecessors. We all agree, regardless of our Party Afghanistan affiliatings. Its how we spend the money youre most concerned with. Where do you think we should be spending more and where do you think we can cut back . We have to look at the nature of threats were likely to face. This is done every four years in the qdr. That is to make this assessment. Where are we likely to have to be involved on a military basis or have to defend ourselves around the globe . So obviously terrorism is going to be with us for the rest of our lives. In is something we have to face much like john kennedy said we have a long Twilight Struggle with communism. We have a long Twilight Struggle with communism. Whether its isis, boko haram, or whatever it might be. Its sort of like mercury on a mirror. You push down on it and in one place and it will slide to another. We have to reconcile ourselves that this is a longterm threat that were going to have to face for many years to come. Its going to require to restructure or forces and our technology. And our policies to confront that. Theres no quick simple solution saying we have our special forces in. We can inflict a blow upon isis and go home. Thats not the way it works. Terrorism will be a big part. I think the rise of resurgence of russia in terms of what its doing throughout. Destabilizing ukraine, possibly trying to do the same with the belkan states. We have to be concerned about the rise of china. Those are the big issues we have to look to. On top of that, the National Debt is also a National Security threat. Sure. And to come back to Simpson Bowles we cannot continue the way were spending. Stwre to reform taxes and e entitle element programs. Theres no other way to get control of the National Debt. You agree with that . I agree with everything he said. I would add going back to your first question about what we need to do. In addition to what bill said the pentagon has to have some consistency. Its the only way they can plan. You cant continue to face things on a tactical basis. We have to come at it in a larger, strategic, longer term view as bill is talking about in a budget thrives on. Thank you for joining us today. Secretary hagel, thank you for being here for the hour. When we come back saudi arabia is viewed as the latest effort to consolidate power. Check out shares of lending club. Stobs down sharply after the ceo of the online lending marketplace resigned. It looks like the board may have asked for the resignation. Stock down 26 . Squawk box right back. New this morning Oil Prices Rising on a raging wild fire near canadas oil sands. A cabinet reshuffling in saudi arabia. Well talk to veteran Analyst Daniel jurgen. Donald trump is open to raising taxes on the rich. Grover norquist responds. A super hero at the box office. I can do this all day. Captain america smashes records with the fifth best Opening Weekend ever. The final hour of squawk box begins right now. Announcer live from the most powerful city in the world, new york. This is squawk box. Welcome back to squawk box on cnbc. Im joe kerner along with becky quick. Were less than 90 minutes away from the opening bell on wall street. The futures right now up about 36 points this morning up 5 now on the s p 14 on the nasdaq. The markets in europe were stronger earlier. The markets continue to do pretty well. Maybe keying off the nice gains we saw in the dow on friday. Which was kind of a rebound. Finally, it stopped raining. I said we need the rain to stop before we get any positive market. From your words. I mean from your lips. Yeah. And finally, it stopped one day and i was like wow and the sun came out. I think it was friday and then the next morning i looked out again and im like youre kidding, right . I heard it in bed. And sunday the whole place looked different. Its pretty nice the trees. When its dreary we got to keep the flowers and dogwoods longer than we would have otherwise. Is that what happened . Yeah. It stops blooms. It looks beautiful. May flowers bring mosquitos. Its supposed to be march brings april with getting warmer and warmer. No. O opposite. Oil prices rising. Two stories in play here. First of all, in canada a wild fire now consumed at least 400,000 acres. It continues to rage more than a Million Barrels a day in production has been knocked out. Its in the Oil Producing region of the country. A shake up in saudi arabia. Long time oil minister ali alnaimi has been replaced with Khalid Alfalih who had previously run the stateowned oil company aramco. It was likely spearheaded by deputy crown prince. It submits his control over energy policy. It makes it less likely that opec will change policy when it meets next month. We check out prices this morning, they had been quite a bit higher but they have been giving a lot of gains. Oil prices were up over a dollar this morning. Right now up by about 11 cents. Sitting at 44. 78. The ceo of online lending marketplace lendingclub is out. Thats the gentleman there. Ill give it a shot renau Renaud Laplanche left the country after the board terminated you probably cant do that even though that great french skunk character. Thats probably politically incorrect. I apologize. I dont know how to say it. I think its renaud determined he violated Company Guidelines on Business Practices and disclosures. The companys president , Scott Sanborn will serve adds acting ceo. Shares are down sharply and should disappoint out that paris is my favorite place and my entire place. We love the french people more than anything and the rich, creamy sauces. Great wine. Nothing to argue about. Earnings and revenue the beef and poultry producer said it was pleased with the results and what typically is the most challenging quarter of the year. They have a big capitals president. They do. He used the words islamic extremism. And Tribune Publishing adopting a shareholder rights plan. This comes in response to an unsis litted acquisition proposal. This just out from valeant pharmaceuticals. It expects to file the First Quarter finances on or before june 10th. Last week it filed the annual report for 2015. Fridays weaker than expected jobs report changing the outlook of the fed rate hike. Steve liesman joins us with the story. We saw it play out instantaneously. It was pretty interesting and it continued into the commentary. Here is a new equation on wall street. 40,000 jobs equals about two months. Yeah, the fridays job report came in under 60,000. Looking for 205. Also, the three month average. So wall street firms what did they do . It was enough to dial back their calls for the fed by at least two months. They all challennged their tunem june to september. We have changed our call moving to one hike. That was theme, also, rather than two. They said, you know, were going to do the next one is going to be later and only one of them. September meeting. To me its all over stated. Goldman cited cnbc interview as part of the reason for changing the calls. Some have turned noncommitment tal. They said, by the way, that said we see the economy on a path that will prompt the fomc to prompt the normalization process before too long, most likely in september, but perhaps early july. The idea its supposed to show reasonable bounce back this quarter from 0. 5 growth despite the weak jobs report. Many economists sticking to the calls around 2 growth this quarter. Better data could reignite the debate about summer time hike. So, you know, it seems to me a bit overreaction here. You have a lot of volatility. A number of jobs look like this. We were still only at 10 expecting a rate hike in june. Right. But it was the big houses when goldman and bank of america do Something Like that and push it ahead. We knew there was a split between what wall street was expecting and the fed has been sort of claiming to this point. Its one of those seismic events that tries to move them closer to each other. It was wall street. Its actually the other way around, i think. Really . Yeah. The fed moved to the street. Now the street kind of moved ahead a little bit but they have moved further away. What happened is you had a bunch of guys out there like lockhart saying we can hike sooner than the street thinks. Then janet yellen talks and everybody says forget it. Its bad when the market doesnt go up. I think theyve been there and done that. Its definitely i think its good. Yeah. But well, were getting there. Weve got ton the point where we dont good news can be good news, too. I dont know why thats what im saying. If you have the half empty viewpoint. Then you think good news is bad news. If we dont get the good news and what used to help is the fed is not going to go in june or august and that stops going up on that. The artificial high you argued for years and years. Were not going to put it up anymore. What it should go up, joe. When is that happen . Better earnings. You tell me. You think were down forever on earnings and not Getting Better in the next i dont know about earnings. Better economic data. Thats i have been for seven years. Better is a relative im not getting involved in this your monday morning. Its not a monday morning. Youre kind of angry this morning. Im not. We havent had a 3 year. Thats right. We have not. Im trying to get back to two. Trying to get back to two. Thats the only thing. Thats the forecast so far. And we lived in the soviet union you think two is good. Its not. Three and a half. Weve been discussing all morning Oil Prices Rising after im not angry you are im not angry im not angry at all. For the record, joe is angry. Hes not angry im going in tax freeze. What is that . Tax freeze. Oh. Okay. I dont care. Im a liberal now. You are not . Yes, i am. Youre with trump on higher taxes for the rich . What did simpson bolls say . They wanted this. You got to negotiate. Look, i think that was telling when he said the Republican Party is not the conservative party. All right. Ive been tracking this, joe, for a long time. Steve, the republicans have been sticking with their principles for the past eight years and obama has run circles around them. Theyre like what hit us . They have no idea. Thats why the 42 has risen instead of romneys 47 . Have a great day. A Cabinet Reshuffle in saudi arabia ali alnaimi replaced with Khalid Alfalih. The chairman of ramco. Joinings now is dan jurgen. We had someone on, one of your colleagues on earlier, dan, and hes 80 or so. Hes been around awhile. Yeah. He didnt necessarily do anything wrong but this guy said he did. What he said was the country is being run by millennials now. This guy was the old school. Is there any truth to that . I think its i think that ali alnaimi had indicated he wanted to retire for some time, and now the theyre launching a big vision 2030 program that is taking years to unfold. It was a sensible time to make a change. I think where there is not a change is in the market policy that, in fact, ali alnaimi was at the conference and what he said the new minister said the last couple of days is saudi arabia will respond to the market. Theyre not looking to do the old kind of opec deals. So that part is going to be continuity. The part that is changed is actually the oil is going to be a center piece for the Reform Program that has been called vision 2030 by the deputy crown prince. I thought our last guest said he was advocating for a freeze and didnt go hot and the new leader didnt yeah. He was trying to get some kind of freeze the would have been loosy goosy. The deputy crown prince said were not going to freeze unless iran freezes. As the Iranian Oil Minister said today theres an undeclared war. What were seeing partly played out in the oil market is a deep tension between the two countries particularly in the light of the nuclear deal with iran well, the futures have pulled back. When the fire goes out in canada, do we go back below 40. Well, i think were in a period of between 40 and 50 and we could, you know, still think that probably prices will be around 50 in the second half of the year. If the fire does get under control, its a big chunk of oil now taken out equivalent to about twothirds of the overproduction that is now going on in the oil market. So if it persists, well see an impact of it. And, of course, the u. S. Is by far the biggest importer of canadian oil and canadian oil is our canada is our number one source of oil imports, actually. All right. So between 40 and 50 with an upward buy syus is what you see yeah. Canada the terrible fire, you see by the second half of the year the oil market moving into balance. By the second half of the year will be two years since the downturn started and downturns do end. All right. Dan, thank you. Well see you again. Coming up tax crusader Grover Nordqvist joins us live. Find out what he has to say about Donald Trumps plan and the idea of probably comprise. Stay tuned. Youre watching squawk box on cnbc. Wow, that was random. Random . No. Its all about understanding patterns. Like the mail guy at 3 12pm every day or jerry getting dumped every third tuesday. Jerry every third tuesday. We have Pattern Recognition Technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. Td ameritrade. singing you wouldnt haul a load without checking your clearance. So why would you invest without checking brokercheck . Check your broker with brokercheck. I am a First Responder tor and iemergencies 24 hours a day, everyday of the year. My children and my family are on my mind when im working all the time. My neighbors are here, my friends and family live here, so its important for me to respond as quickly as possible and get the power back on. Its an amazing feeling turning those lights back on. Be informed about outages in your area. Sign up for outage alerts at pge. Com outagealerts. Together, were building a better california. Welcome back. Presumptive nominee donald trump is answering more questions about his policies. Particularly on taxes. Last week on squawk box trump said there will be an negotiation perhaps hinting hes open to raising taxes on the wealthy. Here is what he said on meet the press yesterday. Im going to make sure the middle class gets good tax breaks. They have been absolutely shunned. The other thing, im going to fight hard for business. For the wealthy, i think, frankly, its going to go up. And, you know, it should go up. Joining us now with his take on mr. Trump and taxes is grover norqui norquist. Thank you for being here today. Sure. What do you think . This is a conversation we started last week with mr. Trump what he said on meet the press doubled down on some of those things yesterday. What do you think about what hes saying . Is that okay, in your view . Does it fit the standards of no new taxes . First, he made it clear in both interviews with chuck todd and steph no las that he wants his original plan which is a substantial tax cut across the board for all americans. What he added in this is the obvious comment when youre the president youre not the king. You have to get congress to pass a tax cut. Hell be dealing with kevin brady at the ways and Means Committee on the house side and orrin hatch and paul ryan and mitch mcconnell. If those four people plus trump sit in a room im not concerned that any taxes are going up at all. Now what perhaps trump is talking about is some people benefit from a tremendous number of tax credits and so on. As we reduce taxes for everybody, some people organize their lives around tax credits, Tax Deductions might see some increase, but overall all americans, and particularly, as he pointed out, the Business Community the sharing economy a 15 tax rate on business income for uber drivers and the other in the sharing economy. The people Hillary Clinton is declaring war on is a huge step forward. So hes made it clear he wants lower taxes and the people hes going to be negotiating with will only want to take those numbers further. Grover, you are to the left. You are characterized almost as a cliche of someone that is 0 so ideological and so conservative and so kneejerk on these things. Its just all these khankca p is going to raise taxes on the wealthy. Which they want. The people criticizing him. Theyve been wanting that with simpson bowls the entire time. Okay. Here we come on that will be good enough and it will be good enough. I wouldnt think conservatives. It Grover Nordqvist the king of not raising taxes said you understand the rhetoric that should be good enough. It wont be. I cant believe you said that. Thats the way i felt about it, too. There is some negotiation negotiating that is going into this, but the spirit of what the tax plan proposed is lowering for corporations and everyone else. That doesnt seem like a big concession. There are also two names on the november election ballot. Hillary clinton, who is already advocated a trillion dollars in higher taxes than shes been specific about. Now shes arguing she wants to go after mid class americans. She endorsed that soda tax increase along with double the cost of buying coke and pepsi in philadelphia. She has called for going after independent contact. Cracking down on independent contractors, uber, airbnb just as the left wing did in austin driving left and uber out of that city. So and then she said she would sign a tax increase on all americans on wages the way her competitor wants to. She backed down. She raised taxes on everybody if that came to her. This is not an ideological argument. In is looking at the reality. The two people on the ballot. Thats who you think has the better plan . Trump wants to cut taxes for everybody and as he said, look, he has to negotiate with congress. Who is he going to be negotiating with . Trump is elected and i think if hes the nominee he will be. Hes up against hillary who wants to do for ohio and pennsylvania what shes done for the Energy Industry in West Virginia. She can get away from losing West Virginia but shes attacking pennsylvania and ohio fracking workers in a way that lose you both states. She cant get past that. Youre not an establishment republican. You must look at them and dont seem to understand that theres were down to two. Its a binary choice here. A lot of party, brom mens bernie is still in the race. The guys you think of are you surprised that principle seems to be, dare say, trumping common sense . Its not so much a question of principle. People what is it . They picked a horse x number of months or years ago and their horse didnt get there. It takes awhile. Youre in high school and break up with one girl before you find a new girlfriend. Theres a moment of depression. Hopefully it doesnt last all junior year. But there is an election on. This is terribly important. Never mind the Supreme Court. Right. Simply on taxes and the economy. Hillary is on the wrong side of history on the gigga economy. She wants everyone in america to have a boss. What trump and the others advocating for the sharing economy and uber drivers and lift drivers and air bnb, and the various ways younger people are choosing to organize their lives giving them more flexibility so they can work when they want. Not everybody punches in 8 00 to 5 00. Not everybody wants to spend a thousand dollars their income every year paying union dues to a guy. They want to run their own lives and make their own deals. Thats what uber and Companies Like uber have given to people and what hillary announced she wants to talk down with crashing down on independent contractors, which make s uber illegal. Watch austin. Thats the opening shot by the left against the sharing economy. Governrover, have you receiv signed pledge from donald trump saying he hasnt raised taxes . We do not. He has made the announcement publicly. I dont have the pledge. Im glad hes been saying the right things, i think it would help some of the critics out there who dont feel they know him, if he would make the commitment in writing to the American People that all the other candidates, except jeb bush, took in this election cycle. Plus, 90 of republicans in the house and senate have. Its simply stating the obvious. No republican president is going to raise taxes. Jeb signed supporting the eventual candidate, too. I dont know whether it mattered. Yeah. It doesnt mean much. That was disappointing on his part. I know. Grover, thank you. A doughnut deal. Who is buying krispy creme. You both have a perfect driving record. Perfect. No tickets. No accidents. That is until one of you clips a food truck, ruining your perfect record. Yup. Now, you would think your Insurance Company would cut you some slack, right . No. Your insurance rates go through the roof. Your perfect record doesnt get you anything. Anything. Perfect for drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claim centers are available to assist you 24 7. For a free quote, call Liberty Mutual at switch to Liberty Mutual and you could save up to 509 call today at see Car Insurance in a whole new light. Liberty mutual insurance. Hey, jesse. Who are you . 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Go pro with crest prohealth advanced. Moms right. Again welcome back to squawk box. Just announced doughnut deal chris by cream being acquired by a private equity firm jab beech for 21 a share. The total value of a deal is 1. 35 billion. Its a nearly 25 premium over fridays close. So krispy creme is worth 1. 3 billion and facebook is worth 275 billion. Explain that. Obviously youre not the target demo. For facebook. For facebook. But may be for krispy creme. 1 billion versus 300 billion . Huh. You look at annoying pictures of your friends that are sharing too much. Oh, god. Glad i wasnt on that vacation. Who cares no. All of our friends look better. Your kids arent cute one word braces cranky. Other stocks to watch this morning Real Estate Investment trust hcp is spinning off the manner care for nursing and assisted living facilities. Hcp specializes in health carerelated real estate. The stock is unchanged at the moment. Valeant will fire the First Quarter financials on or before june 10th. After june 10th is well in advance of the july 31st deadline mandated and stocks up by over 4 . Valeants new crow will eo will mad money. Teva reporting 19 cents better than the street was expecting. Generic drug makers revenue beating forecast. That stock is up by over 4 as well. And astronomy fans listen up. The planet mercury will be visible today to most of the world. Mercury will look like a black speck between now and 2 42 eastern. Its phenomena called the transit of mercury. As you can see, its going to be incredible to watch. It happens only 13 or 14 times each century. If you look directly at the sun, it might not be a great idea, either. Astronomers recommend using a special solar filter to see the speck or look at any image of a bug crawling across. It will project the image of a sun on to a piece of paper. Like orton hears a who. Our solar system, compared to what is going on out there, might not be the most compelling. Theres a lot of spectacular things. Compared to yeah. Or even watching a showers of comets. Great. Theres big news in the oil world over the weekend. Saudi arabia replacing longterm oil minister ali alnaimi. Cnbc hadley gamble joins us. Hadley. Hey, good morning. New day and new oil minister. Khalid alfalih is a 30year veteran of saudi aramco. The latest minister to join the saudi super team about 24 ministers newly put into office over the last several months that are tasked with revitalizing the saudi state. Long time veteran ali alnaimi went to aramco yesterday. He spoke to colleagues there. He thanked them for helping him over the 23year term. Of course, what happened over the last several days in saudi arabia, while it may not single a policy shift in terms behalf is happening in the oil market, its certainly about consolidating the power behind the royal court. And the bigger question out there is all about how this is going to impact the sale of that 5 stake of saudi aramco. Theyre saying its going to be the rar largest ipo in history. The chairman and ceo of aramco is expected to smooth the way. When i spoke last week to the ceo on the Stock Exchange in saudi arabia he assured me the listing was going to take place on this exchange. A report earlier today in the telegraph suggest there had would be a trilisting where we have it in new york, london, and hong kong. The bigger question is whether or not selective stakes held by Companies Like bp, exxon. A lot of questions surrounding the ipo but a lot of excitement. Hadley, thank you very much. Again, hadley gamble. Back here in the United States the department of justice is suing online Mortgage Lender quicken loans claiming that the mortgage giant knowingly submitted claims for improperly submitted fha loans. It follows about 100 billion in set settle elements. The ceo of quicken joans joined us. Youre saying no to a government deal. Something that other Mortgage Lenders have not gone ahead and done. Why do you think youre right and why wouldnt you settle . Well, you know, becky, its good to be here. Lets look at the facts. Largest fha lender in the country, highest quality, lowest default rate in the country. The lender lending to more middle class americans and low to moderateamerican earnings. Trying to help folks gain Home Ownership and refinance and consistently recognized six year in a row for customer service. This is the type of lender that the department of justice is going after in trying to extract a settlement from. I mean, i dont know what else i need to say on that particular front. Yeah. I think you have the lowest, at least if my information is correct, the lowest of default rate for the last two years running. I was surprised to see the government do it as well. But usually when the government comes knocking, its really tough for any company to say no. Its a easier to say okay. We will settle well, i think thats true. I think youve seen that. If you take a look what happened, the largest most well capitalized lenders in the country have been systemically targeted by the doj and they take a look and threaten and shame and talk to other alqages and try to pressure people to settle. Thats been a Business Model that worked for them. For us its not something we can begin to stomach and look at. Look 12,000 team members and say we committed fraud against the United States government. We didnt. We refuse to settle as a result of it. We want the jury of our peers determine the outcome. Do you say the government is wrong on the particular instances they claimed it was fraud . What is your answer to those specific cases . Yeah. Were saying its wrong. Were talking about, you know, theres a manufacturing process that takes place. There will be mistakes that happen here. An example, we miscallated income by 2. 10. We overlend somebody 26 on a loan program. Those are the type of things that the department of justice is saying is committing fraud against the United States government. Its just dead wrong. In the federal suit, the government has email going back and forth with you asking where is the upside on a particular loan and the answer coming back an employer responding is the only upside we have fha insurance. In that particular loan didnt go bad but emails like that might prejudice a jury. A good thing about a jury is you get to look at the email versus taking a snippet of the email and plugging it into a complaint. The dialogue for us is the fha wants us to lend to this person. We. To put overlays in place. When you do what the fha asked you to do and lend on that particular situation, my question is i look from a secret perspective where is the upside . I look at the credit. But the fha wants the loan every day all day long. And that is interesting. We have julio castro and he said one of the stated goals is making sure that americans who have lower Credit Scores are able to borrow loans and able to buy houses. I asked him specifically about this case. He said he would rather not comment on ongoing litigation. What is the after effect of these moves that the government is doing at this point to sue all the lenders . Well, think about it, becky. When the administration said lets lend to more people and go after lenders and hold them accountable and make them peytons of money. They call that looking in the rear view mirror. The reality if you look at the top lenders in the company. The best capitalized lenders left the fha program. Theyre out and done with it. They had their fill of fha. What they are starting to realize now they have counter parties that are lending out in those communities that are less capitalized than others. At some point down the line that will haunt them. Unfortunately, what is happening in the people that are suffering from an excess credit perspective are middle class americans, blue collar workers, low to moderate income folks, firsttime home buyer dont have access to credit. Give them more access to credit but continue this beatings will continue until morale improves. Bill, thank you for joining us today. Obviously, you people strongly about this. Well be watching the case closely. We appreciate your time. Happy mothers day becky. Thank you very much. Coming up, captain at the box office. Disneys new movie smashing records in the opening record. Ticket sales and look ahead to the promise of summer at the box office next. An important time of year. A look at the shares of disney. Up about 10 over the last month. They have to roll out Quarterly Results after the bell tomorrow. Well be right back. eeeeohmumohweh hush my darling. dont fear my darling. the lion sleeps tonight. hush my darling. man snoring dont fear my darling. the lion sleeps tonight. woman snoring take the roar out of snore. Yet another innovation only at a sleep number store. Welcome back to squawk box. Disney ruling the weekend as captain america smashes record. Julia joins us from l. A. And she has the details. Good morning. Captain America Civil War brought Disney Studio to new records this weekend. The film grossed 182 million in the u. S. Fifth highest Domestic Opening ever giving marvel four of the top six openings of all time. An additional 220 million overseas brings the total box office to nearly 680 million. These numbers and nearly universally positive reviews bode well for the nine other marvel movies in the pipeline. Not to mention, related consumer products. Its not just super hero. The jungle book came in second second place in theaters giving it a total of over 750 million. These films plus zoo taupe ya and the force awakens giving disney a new studio record hitting 1 billion at the u. S. Box office. And 3 billion worldwide faster than any other studio has despite more than a month. Disney sold a quarter of all movie tickets in the u. S. So far this year. These films are bigger than just the box office. Theyre about franchises that disney can tap into on all the platforms. Guys, back over to you. Julia, thank you. Joining us now Barton Crockett senior analyst. Barton, i noted 106. Were like 115 before that little tremor with espn, werent we . Song, yeah. When does i mean, is this what should we be paying attention to at disney at this point . The multifaceted, obviously, but how did that shake the longterm prospects for disney that espn news we had six months ago or eight months ago . Right. I think that disney is about half tv, most is espn and half a bunch of other stuff which is doing brilliantly. I think right now you need to focus on the brilliant stuff. I think the studio segment at disney is kind of set an alltime record this year for domestic box office. I think it will make 3 billion a profit for disney up from about 2 billion last year. Its a nice increment to a company doing about 60 billion of profit. In a couple of weeks opening shanghai in china. I think the outlook is constructive give a large Market Opportunity and cost structure that will, you know, be favorable relative to other theme parks weve seen. And i think the tv ad market, from what weve seen of the tv Companies Reporting last week, is pretty good. And i think disney and espn is going to benefit from that. So i was on cnbc last august talking to clients saying a lot of concerns about tv were overdone at that point. I think what were seeing now is the data saying thats the case. I think that will be helpful for disney from here. Yeah. Time does go by and i have been watching netflix. Netflix was supposed to aggravate all the market cap of the big multimedia companies. That was just supposed to be worth a couple hundred billion now. Everybody was supposed to switch to the skinny bundle by now and cut the cord. I dont know. Is it just glacial . Is it still happening . I think its glacial. I think what you have are people got scared, you know, they forget its not just the trend but the pace of the trend. I dont know theres no doubt people will be watching more video from the internet. Theres no doubt that the tv guides are Getting Better at delivering it over the internet including things like watch espn, the espn app. I think the consumer is watching netflix but getting it in addition to the tv subscription. Its not replacement. One of the reasonst its not because of sports. So you that dynamic on top of a company that is hitting it in the movies, you know, like weve never seen a company like weve seen a company do it before. I think thats decent for disney stock here into the print on tuesday and the next couple of quarters. Yeah. Type of determination is that going to be what i want less . Give me ten chants. Who wants 500 . Its a tough trend. We consume more entertainment and information. You know, its hard for me to see that reverses. I think that, you know, we continue to absorb a lot more and i think that is good for the producers of some of the best highest demand contact. Thats where disney is playing. I think thats an environment where they can live and execute and you can own the stock opportuni opportunist opportunistically. Going to sign for five more years . Obviously we need to navigate that and the transition, you know, from ieger was not what we wanted to see. We love the fact hes still running it. Were waiting with bated breath for the transition. Thats a happy thing. All right, barton. Thank you. You were related to Davy Crockett far back. Yeah. That is cool. Really . Yes are you kidding me . Davy crockett . Yeah. Thats why it was a cool name. Not that side. Yeah. The other way. Youre not related to Brian Roberts are you . No, not related to Brian Roberts. Great. Youre on your own on that one. When we come back jim cramer joining us live. First, as as we head to a break check out the futures right now. Were giving back some of the gains we saw earlier. Dow futures are still up close to 20 points, s p up by 3, the nasdaq up by 11. Stay tuned. Youre watching squawk box on cnbc. I built my business with passion. But i keep it growing by making every dollar count. Thats why i have the spark cash card from capital one. I earn unlimited 2 cash back on everything i buy for my studio. And that unlimited 2 cash back from spark means thousands of dollars each year going back into my business. Thats huge for my bottom line. Whats in your wallet . All right, lets get down to the new york Stock Exchange. Jim cramer joins us now. Jim, were not going to have as many data points from the corporate sector now because its kind of like midmay. And i dont know whether we still care about oil or the dollar or china. What do you think is going to replace all those things . Is there a vacuum right now for what to key off of . Well, i know that the retail sales this week are going to be very, very big because i think the people are thinking that the economy has hit a rough patch. I dont know. I mean, i think if we just grade this economy on a daily basis, its just not going to help anybody. I do think that oil does matter. I think that oil changes the futures here very much. The s ps very linked. And then when we get to the actual companies, theres some good earnings results. So, it is to me, joe, this is just another one of these weeks where on any given day, the Earnings Report will affect things, but oil will take us down if we cant hold this 45 level. So, we have the retailers. I thought we had most of the s p 500, but we have the retailers and thats what well have to focus on. You think theres actually going to be some compelling things going on there, not just companyspecific, but overall you think were going to be able to discern something . I just think that the mall is going to be in trouble. I do believe that the Real Estate Investment trust defending themselves, both simon on a shopping mall, federal realty on a shopping center, kimco on a strip, tangor on an outlet. All of those are good, but there is so much competition that youre looking at wayfair reports today and, geez, theyre up against amazon, up against furniture store. Their competition in retail is too great. We need more retailers to, i dont know, sadly, go under. Theres just too many of them. All right, jim. Thank you. All right, well see you. Coming up, this mornings biggest stock movers. Then later, the business of superheroes. The ceo of Amc Entertainment joins us, squawk on the street, to talk captain america and the theaters. Yeah, stay tuned. Youre watching cnbc, first in business worldwide. Actions speak louder. Something well show you. Through small things, big things, and spur of the moment things. Big things, hey kevin. Hey, fancy seeing you here. Uh, i live right over there actually. Youve been to my place. No, i wasnt. Oh look, you dropped something. Its your resume with a 20 dollar bill taped to it. Thats weird. You want to work for ge too. Hahaha, what . Well were always looking for developers who are up for big world changing challenges like making planes, trains and hospitals run better. Why dont you check your new watch and tell me what time i should be there. Oh, i dont hire people. Im a developer. Im gonna need monday off. Again, not my call. You wouldnt order szechuan without checking the spice level. It really opens the passages. Waiter. Water. So why would you invest without checking brokercheck . Check your broker with brokercheck. Welcome back to squawk box, everyone. An unlikely source of revenue for the transportation Security Administration. The agency says it actually collected over 765,000 in change that was left behind at Security Checkpoints last year. Thats nearly 100,000 more than was collected the previous year. The tsa says it plans to use the funds to expand its Precheck Program that gives passengers expedited passage through checkpoints in exchange for some personal data and a fee. And twitter is reportedly cutting off u. S. Intelligence services from dataminr. The private service analyzes twitter patterns and sends out alerts about terrorism, political unrest and other events. Twitter holds a 5 stake in dataminr. The journal reports that twitter wants to distance itself from american intelligence for appearances sake. So, we wont sell you the information that well sell everybody else . Yeah. Thats a little weird. It is a little weird. Twitter says it has a policy against third parties selling its data to governments for surveillance. Youre a terrorist, okay, come in, well sell it to you. But thats the hipster, you know, the beard, all that. Thats the hipster mentality. Pro Edward Snowden and everything else. I wonder if the government was actually paying for it before whether they cared. Right. Stocks to watch, krispy kreme is being acquired by private skl firm jab beech. The value of the deal is about 1. 4 billion. Thats nearly a 50 premium over fridays close. And Teva Pharmaceuticals beating the street on both the top and the bottom lines. Generics continuing to drive results, despite no new introductions during this quarter. The stock is up by 5. 6 . Valeant will file its First Quarter financials on june 10th. The stocks up on that news. This comes after the drugmaker filed its delayed report in late april. The june 10th date is well in advance of the july 31st deadline mandated in its agreement with creditors. And valeants new ceo will be on mad money with jim cramer at 6 00 p. M. Eastern tonight. That does it for us today. Make sure you join us tomorrow. Right now its time for squawk on the street. Good monday morning. Welcome to squawk on the street. Kacarl quintanilla with jim crar and david faber. The earnings pace slows way down with retailers like disney on the calendar. German factory orders the best since june has europe in the green. Oil remains a big story as the saudi oil chief is ousted and those alberta fires continue to rage. Our road map begins with oil prices jumping on the outages from wildfires in canada as the market turns its atten