Transcripts For CNBC Squawk Box 20170217

Weve been seeing. Right now the dow is indicated down 58 points. S p off by 6. 5, the nasdaq down by 12. The dow once again yesterday set a new record high. You hate when i say new record high. New fresh record alltime high. It has been six records in a row for the dow. The s p 500 and the nasdaq breaking sevenday winning streaks. You are looking at the dow on pace for the best week in more than two months this week. Nasdaq and s p are poised for their fourth straight weekly win in a row. Overnight in asia, look and youll see the nikkei was down by almost 0. 6 . Weakness in the hang seng and shanghai composite. In the dax down 0. 4 . The cac off 0. 8 . The ftse is flat. And if you check out crude oil prices this morning, right now pull back of 38 cents for wti. Trading just below 53. Among the top corporate stories. Toshiba shares plummeting again, and s p could cut their Credit Rating by several notches if the Firm Receives federal aide. The credit is rated as junk right now at triple c plus. Any further downgrade would mean toshiba would be charged more for credit. Apple will focus on its lower priced iphone se model. Its taiwanese partner is setting up a plant in bangalore. Apple is tenth in the Smartphone Market in india but leads the premium market with a 62 share. The company has been in talks with the government on issues like tax concessions. Competition in smartphone plans heating up again. At t announcing changes to the unlimited data plan. The company will offer unlimited data to customers without requiring them to have directv or uverse tv service. That matches verizons latest plan offering four lines for 180 bucks with no tv contracts. Eamon javers have a s a wrapf the political headlines. Theres an even split, hinged and unhinged. Which category are you in . Which category am i in . We dont need to get personal. But people are using the word hinged. Some people came to the commentators normally you assume someone is hinged until they demonstrate otherwise. But the performance itself had people i think a lot of journalists watching got completely unhinged. But thats what i say, theres two kind of people. Cat and dog people. Blackberry versus iphone people. For those of us who have both. You werent in the room, were you, eamon . I was not. I was on the north lawn. Ive been in the room earlier this week. Were you cutting the grass or something . Were you landscaping . A little trim. Edging . Our live Camera Position is out on the north lawn. I had to be there to react to it. Did people like cnn people walk out pale as a ghost or mad . I dont think anybody has seen a president ial News Conference like that yesterday. The president feels like attacking the press is core to his appeal, to his Political Base. He went after the press yesterday, no question about it. Said this was all fake news, and that hes being treated unfairly. It was like a president ial airing of grievances yesterday. I watched i saw it, i paused it. I went out, got some stuff to eat, came back, watched the rest. Thought we need a snack for this . Popcorn, some goobers, rai n raisinettes. I enjoyed a lot of it, i have to say. But ive had grievances for i was thinking about how long i thought that things were not exactly fair. Living vicariously . Yeah. Goes back to reagan. Really does. You can see with each succeeding presidency you hate reagan, love clint clinton, hate both bushes, its the way of the world, to see someone break throulhrough thos shackles. Boy, shep is not sure what to do at this point. Chuck todd, hes in a safe place right now somewhere. Well, i think weve got a bite teed up here. One of the key moments in talking about the press. I want to try to move this along a bit. I think this bite is ready. Control room tell me if its not. This is an interesting moment. The president complained about leaks, said it was outrageous that things had been leaked from his presidency, but insisted the leaks were accurate, but the news based on the news, the reports about the leaks themselves were somehow fake. If we have this bite, go ahead and play it. The leaks are real. The news is fake because so much of the news is fake. Not entirely clear how the news based on the leaks could be fake if the leaks are real. The president extraordinarily upset about leaks coming out of his administration. This is a president who in many ways campaigned on leaks, and said i love wikileaks several times throughout the Campaign Last year. Now that he is the victim of leaking, he has a totally different opinion about it. This president is frustrated with leaks, people inside his administration, people who he said might be holdovers from the Obama Administration, and the media yesterday. Eamon, the thing that is a little bit frightening or disconcerting, still concerns russia. And that is that the president as many times as he was asked about contacts between people in his administration and russia, he always finds a way of not directly answering whether he knows for sure. If that does come out later that theres i dont know, theres something that wasnt if there was dissembling or something that could be a problem. He had a couple of opportunities to answer that yesterday. He kind of answers it. I didnt have any contact, or not that im aware of that leaves a lot to of wiggle room. Which is why the reporters come back and ask the question again and again, and is frustrating if you want to hear about other things. Its an hour and 17 minutes, but you feel like youre not getting the news you want out of it. Look at the news last night. Robert harward, retired vice admiral, former navy s. E. A. L. Turning down the president s apparent offer to be National Security adviser to replace mike flynn, who the president fired earlier in the week. Harward cited family and financial concerns there. But there are also reports that he was concerned about the way the white house is being run, concerned that he might not be able to appoint the people that he wanted in key positions inside the National Security council. Thats another point of potential concern for the white house. Watch that space in terms of highprofile people that the administration would like to bring on board, resisting coming in ive talked to some in washington who are the types of people that the president might want to bring on board for these key positions. Hes looking for a Communications Director still. Hasnt made an offer to anybody on that. There are people in town who would be qualified, idealogically simp idealogically sympatico who dont want to go into the white house because of the confusion. I thought i saw the Communications Director maybe that was fake news i saw. I thought they decided. On the other hand, you look at washington right now, would you want to take any position in an administration i can understand how harward maybe just said, you know what . Life is good. Got my family. Making money. Hes an executive at lockheed martin. Getting paid a lot more than he did in the military. Do i want to go into that vortex, not just trump and the chaos there, but i do want to have the responsibility of that job weighing me i dont know. I would say ive been surprised at a lot of billionaires who came to washington to run the commerce department. The Small Business administration. These are people who dont need this kind of a headache. But they dont need the money either. Harward worked 40 years in the navy and is finally out in the private sector and can finally make some money, too. I think if andrew were here, he would say those billionaires will really make some money now. Now youre channeling. Watch wilbur and the oil markets. The president fired his National Security adviser and said the National Security adviser had been unfairly treated by the media. Its not clear why you would fire somebody i thought he was i thought that was pretty compelling, he said i would have told him he didnt violate that law. He said i would have told him to talk to the russians. To speak to the russians. But when asked by Vice President pence, thats when he said thats fully i thought he gave a he said he went back over that again and again and again. That thats what mike flynn was supposed to be doing. If done it, i would told him to do it. The weird thing is if thats what he was supposed to be doing, why did flynn lie or mislead the Vice President of the United States about that, and theres a question about whether he misled the fbi which would be a legal problem for mike flynn, potentially. If the president said this is fine behavior and he would have ordered it, why would flynn feel like he had to mislead the Vice President on it. I dont know. Flynn was a lightning rod before from both sides of the aisle. Any way, all right, eamon. Dont go anywhere. Well see you next hour. Something could happen today. The president has already been tweeting this morning. I have to monitor that. With all the other stuff, thats the headline. Well do something about march. Early to midmarch on obama care, and obama care comes before tax reform. As you know, joe, healthcare reform in this country has been a quagmire for president s it takes longer than they think. Its more politically fraught than they think. Weve seen president clinton trying to do healthcare reform and that ended up in a quagmirement its a dangerous area to go first. Are republicans that tried to do it how many times and didnt have the president ial signature. Now they want to do it. And then you had bertolini from aetna saying this is a death spiral. Says it is a death spiral. So if the democrats try to say this is trump care, this is your fault, i dont know. The republicans themselves have said they own it at this point. When they were talking and they released more leaks, they were coming from the republicans that were thats what theyre worried about. Theyre worried about the 20 Million People who loses coverage. If one person loses coverage, youll see that person on a fivepart series on how he lost his insurance. But this thing is not viable the way it is. They have to do something, the question is what do they do and does it square with what they promised on the campaign trail and how politically palatable is it right now. Eamon, thank you. You bet. The s p 500 and the nasdaq both snapping a sevenday winning streak as stocks pulled back from the records. But the dow did manage to eke out a small gain to hit another alltime high. Joining us is Julian Manuel from ubs. And eric knutsen. Welcome to both of you. Great to be here. Julian, lets talk about once again, yesterday, if you look at the headlines, wall street journal, new york teams, every one of them has the press conference as the lead. Yet the markets came off the lows of the day and managed to stabilize. What does this tell you . It is this diverge yence we had. It was 100 days ago that mr. Trump was elected. You have Political Risks, high here and internationally, and economic perceptions of risk growth which have boosted the markets. Up 10 in the s p, up 17 in the small caps. When we look forward to the next 100 days, it seems like there will be a pretty big turning point on february 28th when the president addresses the joint session of congress. Theres an expectation that at least the outlines of a tax reform package are going to be known. And thats really something that, to us, you will need to see a package that can be negotiated Going Forward in an effective way to keep the markets going higher. That press conference was mustsee tv. I have never sat around and watched press conferences like i did yesterday. It was absorbing. Adjectives failed me. It was. To eamons point, i thought the markets would sell off when he started laying down the time frame on how long it would take before we see obamacare repeal, and then the taxes after that. The markets seemed to shake it off. This divergence between economic certainty or volatility and Political Uncertainty and volatility has been remarkibabl. We have been overweight u. S. Equities, switching from treasuries to t. I. P. S. , high yields to bank loans, the one expectation that we have not had that has not been fulfilled is an increase in volatility. We could see a 10 handle on the vix. That tells me the market is looking at this and its okay, the reason were at these valuations, they think its fair valuati valuations, based on earnings. You have had enough fundamental information to provide that level of business confidence, Small Business confidence, consumer confidence. We have expected some pullback. We think there will be better opportunities in the next six months. Are you telling people to wait to i vest or buy any way . We have been adding to our positions, but weve been now watching and waiting for a little while, expecting some volatility. We want to buy at better levels, we think 12 months from now earnings will be high. Is this a fear of missing out mentality here that is gripping the markets . Because from what youre saying, it sounds like theres going to be a pullback, better opportunities, yet were still adding. Were still in this market fully. Were not changing our position. Sounds to me like you havent been buying very much for the last month. You missed this entire most recent move. Youre still pretending that youre adding to it. You can say weve been adding. But you havent been. Not for the last month. We were overweight going into the stretch. So you were out early. You were out early. You missed the last move. No weve been overweight. But we have been looking to looking to add at other levels. In terms of being not no in terms of adding a lot of people the last month have in fact, a lot of people thought the first month that we saw after the election, that that was going to be it. We had people in here, goolsbee and others saying its up for the first month. Now what has it done . Then this has been another leg. 100 points every day. Yeah. Theres a lot of potential Technical Support to this. You look at how much money flowed into bonds versus stocks. Bond funds versus stock funds. Well have Katie Stockton on later in the show. You are going to be here . Have you taped the show . Shes in this half hour. You should stick around. She would have told you this would keep going, then you based on the technical level. Shell probably tell you it will keep going to be . Im looking for a pullback here. I heard you. You were looking a month ago for a pullback. Well keep looking for opportunities. Keeps going up. Looking at the other side of it, i feel like a lot of investors are saying were in the market, we dont want to miss the move. We havent been doing much but were in there. Does that tell you people are so positioned in equities, if there is a whiff of a reason to sell off, that the selloff will be sharp and short . The potential is there. Feels like the positioning is extreme. The Options Market is telling you it is. Upside call options are historically expensive, which talks to the fear of missing out. From our point of view we would rather be selective here. Eight years into the bull market, much more focused on valuation. That gets you to financials. That story has been bearish for ten years. Which we think works even if the broad market stays here or corrects. Health care has been bashed. We think theres a lot of room there despite the tweeting and noise. The lead on cnbc. Com competitor today is that not yesterday, but the day before the vix spiked for no reason. The market was up 100 points on wednesday, right . It was shortcovering. Supposedly shortcovering by a firm. You see . Shes the right person. Im asking you. On fast money you saw that. In general. Yeah. We saw it. So you think the traders were saying it was shortcovering. Other people were saying the Political Risk is finally coming home to roost. Its 100 points. Thats a half percent. It goes up 100 . But the volatility went up. From the 10 and change to 11 and change. The vix went up. It was up 3. 5 . But its been historically low. Really low. Thats all that positioning. They wrote an article on market watch that that was the sign that were getting topy and that the Political Risk is coming in. You have to write a story every day. You do. Thats the problem. Thats the problem. It is. Like manufacture news the next week its called the news hole. But the next week you dont recall what you wrote. Its a new week, hamster wheel. Julian, thank you very much. Thank god, if you were putting money to work, you would actually see what you said before. Coming up, if youre still a blackberry user, you are part of an exclusive club. New numbers on Smartphone Market share after the prak. Welcome back. You know, there are people who aspire to be part of the 1 . I want to tell you guys, im part of the zero percent when it comes to some measurements. Blackberry ownership has declined to the point where it is now officially 0. 04 . It is 0. 04. How do you get those things . Corporate keeps trying to take it away. They dont want to support it. I didnt realize, by the Fourth Quarter of 2016, there are more than 432 million smartphones sold. Of those, 207,900 were blackberry devices. Im officially part of the zero percent. Thats weird. Number one, i thought you were talking about money . Yeah. And where you are since you are so successful. You would round down to zero. The other thing is that i wish, but no. I will get flack for this. As opposed to what you say the rest of the day . 0. 04 happens to be happens to be the atmospheric level of co2. I stepped into this. Thats 400 parts per million. Its officially zero. Its trace. Out of 10,000 people, 4 people are using i looked at all these things. Crazy. Its trace. I am trace. Thats illustrative of how low co2 levels go. Its been a few years since i had this phone, too. I cant believe youre carrying both around. Why . Because you are good with your thumbs. Im like a monkey. I can type so fast with my thumbs. I wrote a script this week on this thing for a package. I saw the ceo the ceo is great. I like him a lot. I was so sad when i read this. I have to say, the devices are not great. It is running down my battery all night long, but im so addicted to it. They lost it. I kept mine. You still play . No, i dont play. Case you missed it last night i cant believe this. The Westminster Dog Show rumor made a special appearance on fast money. I stopped in the kitchen. My head almost flipped off my body as i watched that beautiful dog. I have a dog, almost a twin. My zara, also a female. And same coloring. But longer hair. She almost retired last year. Theres my zara. Does that look like rumor . Joe, you have a winner on your hands. Thats zara. I couldnt believe, when you were watching this, the dog was so intently looking at something. Theres a trainer off to the side with dog treats. Ah. Thats the trick. You know, people are tired of this, too. Broken record about german shepherds. You should see when i talk i have never seen intelligence like this in in a human . In a human. In a coanchor. When i talk to thats zara again. Or gunther, her halfbrother. When i talk to them, if you think dogs cant count. I get treats out. And if i believe me, i give them one, she knows she can definitely count. Wow. Amazing. German shepherd my favorite. Though, my dogs could not have been at the place with other dogs around or people . No, no. They you say see the good in everyone, they see they are suspicious of just about everyone. I like it that way. I am, too. When we come back, checking in with choice hotels. The stock has been on a roll up 27 since the november election. The ceo, steve joyce, will join us next. Right now as we head to break, a look at yesterdays s p 500 winners and losers. 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Its giving offshore teams onshore support. And its empowering anyone to stop a job if something doesnt seem right. At bp, safety is never being satisfied. And always working to be better. Welcome back. Youre watching squawk box live from the Nasdaq Market site in times square. Good morning. Weve been watching the u. S. Equity futures, after days and days and days in a row of new records, this morning some pullbacks. The dow is indicated down by 53 points. Yesterday the dow was up for its sixth record session in a row. The nasdaq and s p 500 broke records. The nasdaq is indicated down by 11 points today. No Economic Data today, but a few notable earnings reports. Well get results from campbells soup, deere, smuckers, vf corp and bloomin brands. Choice Hotels Offering optimistic guidance for the full year. Joining us is is steve joyce, ceo of choice owe hehotels. A lot of uncertainty in the air, what gives you such certainty about great guidance for 2017 . We were accelerating into the year, business is really good we have done some things within our company over the last several years to put us in position to take advantage of that. Revamped our Choice Privileges program. Signed up almost 5 million members last year, given our franchisees new revenue tools to optimize revenues. All the things were working on from a Technology Size has paid off. Offering lower rates for all Customers Part of our privilege program. We think business is good, we think the administration will be good for business. We would like a more balanced approach to travel. Our numbers look good. The best part of the business is leisure. Were a big proponent what do you mean a more balanced approach . Promote travel into the country safely and securely. They are not in contrast to each other. You can do both. You want to solve the export import problem, bring in more travelers. The hotels are built. Parks are there. Places that these people want to visit are here. People come here and spend 5,000 a trip. You put out a statement about the executive order travel ban. Were you impacted . This seems like it would impact a small part of your customers. Why would you go out and do that at this point when its not correct me if im wrong, if its not really impacting the people visiting choice ohotels. The numbers are not big, its the message were sending. After 9 11, we lost a third of our market share. We started gaining it back. Thats a good thing for this country. 150 billion in taxes comes from the Hotel Tourism business. Were looking for the opportunity to grow that. Doing it safely, allowing a safe entry for travelers into the country is good for everybody. It creates jobs, creates taxes. We had an airline on, we said this a lot because delta reported after it had a month of the election results, they attributed some of the upside to more consumer confidence, animal spirits. You would concur that even in your business youve seen a more confident consumer . Yeah. They are more confident and traveling more. We did a survey and it said people will travel three times in 2017 individually and theyll spend 6,000. That is up significantly from last year. Like 30 , 40 . Were optimistic based on what we saw at the end of year, what we saw the beginning of the year. And the overall sentiment from our travelers, people are getting jobs back. Those are our customers. Run down your properties again. Im going on a college tour starting now. And these places are in some weird places. Were everywhere, particularly weird places. I hit you up for a deal, but i dont need a deal at your places. No, and you get free wifi, free breakfast. Dont i get free breakfast . Like sausages and stuff . Our largest brand is comfort inn and comfort suites. You get little suites, which is good for family. Where do you get a suite for 200 bucks. On top of that, we entered the upscale space. We have ascend, our boutique collection. I havent seen one of those . Afrnl a series of independent hotels. And cambria suites. So we have down scale to upper economy. We like to say we represent the 99 . You would be at the upper end of that, but we would like to represent you as well. Becky is in the zero percent. No, of phone users. Quail over here, double income family. You guys are loaded. Rolling in it. How do i get the best rate . Is it online . Its online but on the choice hotels. Com. We will tell you we have rates if youre a choice privilege member, if not, join, we have rates lower than anybody else. You will hear from advertisers, that the lowest rates may be on Online Travel agencies, thats not true. He was undercover boss, too. I think i saw that one. I apologize in advance. They would know if you do that again. No. You dont need to do it again . It was great for the company. I got something out of it. You should do the white glove test, the black light. They had me work the jobs. I forgot how hard those jobs are and how special the people in them are. It was a great experience. Good answer. Steve, thank you very much. Youre good. Coming up, jim paulsen will be our guest host at the top of the hour. Hes from minnesota. And americas changing relationship with russia. We will talk geopolitics with George Mitchell. Great time to have him on. And President Trump reversing obama era regulations in the coal industry. You have seen this guy . Remember this guy . Robert murray . Hes a piece of work. The ceo of americas Largest Coal Company will join us at 8 30 a. M. Eastern. Hell be in a really good mood. Welcome back to squawk box. Right now its time for the executive edge. We will start with a tweet from President Trump just moments ago. This is what the president tweeted this morning. He said going to charleston, South Carolina in order to spend time with boeing and talk jobs. Look forward to it. Of course earlier this week workers at boeings South Carolina plant voted to reject union representation. Separately President Trump keeping his promise to the coal miners who voted for him. He told them in rallies he would bring back coal big league, and he is taking a big step. Contessa brewer joins us from ohio with more on that. Reporter im at the point where ohio meets West Virginia. Around here coal means dollars and jobs. What you see at this transfer facility is trucks bringing in massive loads of coal from the surrounding hillsides, loading it on to barges and trains. The facilities owned by Murray Corporation and its ceo, Robert Murray, was in the room with President Trump yesterday when he signed a law that removed an environmental barrier to mining. The stream protection rule was finalized in december. Its an agreement between Government Agencies to protect ground water and surface water from miningrelated pollutions. But the Mining Industry called it overly broad, burdensome and they say illogical. They say if theyre mining thousands of feet below the surface, theyre still responsible for the streams far above. Trump and the house and senate sunk that rule. In eliminating this rule im continuing to keep my promise to the American People to get rid of wasteful regulations that do nothing, absolutely nothing but slow down the economy. I want to point out, democratic West Virginia senator joe manchin crossed party lines, he was actually also in the room with President Trump for that signing. Hes like a lot of voters in this area, longtime democrats, but for them coal is trumping politics and trumping years of tradition. Times are tough. People are struggling. The employment rate is higher than the national average. I will go out today, well talk with the folks around here, see how theyre grading President Trump now that hes been in Office Nearly a month. Dont try to talk them out of it it if they like him. I will do no such thing. We will have murray on in the show later today. Hes a piece of work. A lot of people point to that in a microcosm the whole coal role of it, how it played in the election. That was a Sticking Point to people. There wont be coal jobs left by the time were done with that industry. She said well put them out of work. Trump also in trying to bring back that contingent, maybe democrats that are in coal country, that resonated and became even a bigger thing than just for coal people. Just for coal miners, it became characteristic of the campaign. Dont you think . And the rust belt. In this area, youre looking at people whose grandparents voted democrat, parents voted democrat. When you talk about this generation of coal miners, the industry depends on coal so heavily. When coal falls, other peoples jobs fall. The local hairstylist sees clients coming in and opting for a basic hair cut instead of the upgrades. It all has an impact. They say they like the environment. Theyre not against environmental regulation, Robert Murray the ceo told me right after the election. He said were not into poisoning the Drinking Water where our employees will go and give their children water. But its just blocking our path to success. Powhatan, that must be southeastern . Is that where you are . Southeastern ohio . Right. Just right at the border where youre seeing West Virginia and pennsylvania and ohio. And its, by the way, they will want me to say this properly. Powhatan point. I want you to see it properly, too. Gods country. Gods country down there. They like some they like country music, i think. I was going to say that. Im from ohio, but southwestern. We they are some big hairstyles down in parts of which i like, actually. Right . It shows. The higher the hair, the closer to god. Thats what they say. We have some here, too. And youre from oklahoma. Any way we know big hair. Thanks, contessa. Good to see you. Yeah, nice to see you. Weve been following Katie Stocktons months and shes been spot on. Well talk to her, and right now, a look at markets. A mixed bag. This car is traveling over 200 miles per hour. To win, every millisecond matters. Both on the track and thousands of miles away. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. Companies across the state are york sgrowing the economy,otion. With the help of the lowest taxes in decades, a talented workforce, and worldclass innovations. Like in plattsburgh, where the most advanced transportation is already en route. And in corning, where the future is materializing. Let us help grow your companys tomorrow today at esd. Ny. Gov we have a question about your brokerage fees. Fees . What did you have in mind . I dont know. 6. 95 per trade . Uhhh and i was wondering if your brokerage offers some sort of guarantee . Guarantee . Where we can get our fees and commissions back if were not happy. So can you offer me what schwab is offering . Whats with all the questions . Ask your broker if theyre offering 6. 95 online equity trades and a satisfaction guarantee. If you dont like their answer, ask again at schwab. Our next guest correctly called for a market breakout last summer. Weve been following her calls for months. This is my favorite type of thing. Its episodic guests. Its not like a single episode type guest. Were going to get updated now on where follow the narrative. Katie stockton, chief Technical Strategist for btig. Like homeland is different every season, but the episodes are the same. Youre like game of thrones. This has been going on for a long time. It goes beyond years. You said 2400 a long time ago. Where were we when you said 2400 on the s p . We talked about it i believe in july. At the time, the s p 500 was really trying to push through a resistance level around 2135. People thought it was going back below 2,000, as i recall. Thats human nature, to think its going to go lower. You were saying 2400. With a confirmed breakout, which we did see. When . We finally got that follow through. We saw it in july. We had the corrected phase. Is this one of the charts you gave us . Close enough. Were going to do yours too. Thats whats happened since july. So explain. Were still in an uptrend and momentum is with us . Thats right. It has been such a momentum driven tape. I think thats what we need to be mindful of. Even though it might look like its sort of long in the tooth, these momentum indicators really just turned positive on a short and longterm basis. I think its very supportive of the uptrend. That 2400 level is within reach for the s p 500. I think once we hit that, a correction or pull back is more likely and maybe the 5 range. Although, you say 2400 is not a resistance level, its more of a confirmation level. Its an upside target or gauge. This is what happens when we have no resistance left on the charts. We have to go overseas and look at the major indices in europe to gauge upside using resistance. For example, the 600 index has 13 upside to its highs. Why would a European Index be a better gauge of what resistance levels would be as opposed to, lets say, the bond market or Something Like that . Yields, i would think, would be much closer tied because financial trade depends on bonds and financial trade has been a main driver of the s p. Its not aed b bad point. For me, it was like what does have resistance. Certainly european benchmarks do, japanese benchmarks do. Its just trying to gauge globally where we could go. I think that the relative performance has really favored u. S. Over the long term, but were starting to see signs of life globally or at least stabilization in relative terms where we could see inline performance. What was the other chart . It showed a trading range, the one we completed in july. The way we arrived at 2400 was based simply on the width of that trading range, not to oversimplify the market, of course, but it does tend to have have a trajectory where it maintains that uptrend. With a pullback, we would welcome that as a way to refresh the uptrend, which does appear a bit overextended in the very near term. What is the very near term . For me, i think well see a little pause. Maybe a push higher into march after a pullback. That would be an entry. You cant put all your eggs on technicals. You cant put all your eggs on fundamentals. But you can get bogged down on fundamentals, which i see people do all the time that are tying every move to whether theres a delay in the tax deal. Or theres Political Risk here. They talk themselves out of the market. If we get a 5 correction finally at 2400, thats 2275. Theyve been not buying from 2100 because of the pullback. So when we do finally get the pullback, its still its above where they didnt get in, in the first place. Its so annoying. And they can stay that way forever. We had guys on today talking about it. Oh, no, were looking for opportunities. Theyre missing out. Valuation might be an issue over the long term, but in the near term, we have the momentum. We want to stay on the right side of these moving averages, the right side of the momentum ind cay to indicators and have a topdown view of the market where any individual company or the stock of that Company Might not act in line with the fundamentals at certain times. And there could always be a black swan of some kind. Throw the technicals out and youre down a thousand points. Who knows what it could be. It could be tariffs or whatever. Thats always a possibility. You cant pick that up with technicals. This is true. Well, thank you. And stop going on other shows. Hey, hey. Is that your show . Shes on power lunch. We found her. Share, joe. No. Share the wealth. Katie, thank you. When withe come back, the market rally. James paulsen will join us. Whats Critical Thinking like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley markets now. Investors gearing up for the opening bell on wall street. Two squawk regulars are here to help you finish the week strong. Fired up. The leaks are absolutely real. The news is fake because so much of the news is fake. President trump talks everything from russia to regulation to the record rally in a wide ranging News Conference. We have the latest out of washington straight ahead. Plus, a job innovation investment by accenture, planning to create 15,000 highly skilled jobs in the United States. The ceo is here to talk about the plan and much more as the second hour of squawk box begins right now. Live from the beating part of business, new york city, this is squawk box. Good morning. Welcome back to squawk box here on cnbc. Were live from the Nasdaq Market site in times square. Im melissa lee along with becky quick and joe kernen. Lets look at how u. S. Futures are pointing at this hour. The dow looking to open lower by about 35 points. This after setting a record on the close in yesterdays trade. S p and nasdaq also looking to open lower. Taking a check at whats going on in the european markets. You see the action there. Red arrows mostly across the board except the ftse 100. Lets get to our morning headlines. At t has joined rival verizon in offering unlimited data plans to customers. At t did have an unlimited plan already in place, but it was only available to subscribers to its directv service. All four National Wireless carriers now are offering unlimited plans. A crossborder deal has been canceled because of security concerns raised by the u. S. Government. L. E. D. Lighting maker cree cancelling the deal over a concern of a substance that has military applications. They will be paid a termination fee of 12. 5 million. And earnings just in from heavy equipment maker deere. Six cents better than the street was expecting. Revenue beating forecasts. Deere says it did see soft conditions in the farm and Construction Equipment sectors. Still, you can see that stock is up by 3. New details surrounding the troubles at theranos. The embattled blood Diagnostics Firm didnt have any material revenue in 2015 or 2016. Theranos told investors last month it was down to its last i wish i was down to its last 200 million in cash. But im not a company. Thats roughly a quarter of the money the Company Raised since it was founded in 2003. The journal also reporting theranos geez, why would they need this . They had no funds set aside for legal liability. And they had no material revenue in the years 2015 and 2016. 200 million left is from the money that it raised from investors. And theyre being sued for about 240 million. So therein lies the problem. Youre going to take us to eamon now, but theres another tweet. Do you want to take us to eamon . Be my guest. No, i want you to take us to eamon, but eamon has already seen this tweet. Thank you for all of the nice statements on the press conference yesterday. Rush limbaugh said it was one of the greatest ever. Fake media not happy. I had to get that out for jim paulsen to get him fired up. Im sure hes unhinged. Youre in the unhinged camp from what you say yesterday. Lets go to eamon. President trump saying he had nothing to do with russia during a fiery and wideranging press conference yesterday. Eamon javers joins us with more on russia and the president s next pick for National Security adviser. Eamon . Yeah, thats right. It was certainly wide ranging, sort of all over the place, this press conference. The president responding to those questions from reporters about his aides and associates contacts with russian intelligence. Also responding to questions from reporters about his firing of general mike flynn earlier nin the week as National Security adviser. And we learned that Robert Harward turned down the white houses approach to be the National Security adviser after mike flynn. Harward citing financial concerns, family concerns, but there are also reports he was concerned he would not be able to run the National Security council the way he wanted to run it. Also concerned about some of the chaos and infighting inside the white house staff. So well have to see if we get more reporting on that today as to why he turned down that job. Joe, to your point, this was a press conference where the president felt like he needed to attack the press, and he absolutely did that, called them dishonest to their faces. Thats something thats going to play well with the trump Political Base across the country. The question is now, though, how does it play inside the beltway. The president does need some inside the beltway support. Hes got a massive electilegisl agenda. I wonder what really happened with harward too. I saw jake tapper said he attributed it to the chaos in the white house and said it would be like accepting a shihtzu sandwich. Its the Westminster Dog Show, so i can say shihtzu. As long as you say the tzu. Eamon javers. Juggling. The number two official at the National Security council can stay in her position. If youre coming in as the National Security adviser, youre going to want to staff that yourself, right. Youre going to want to have control over who are the people around you. If theres an indication youre not going to have that kind of operational control, its going to be tough to convince somebody strong and independent minded to take that job. Well see who they go to for their third choice for that job. Thats going to be tough to find unless they give that person that kind of authority. Im sure its a combination. You know what, could be a combination of all those things, eamon. The money, good life now at lockheed, how difficult a job and how much responsibility there is for that. And maybe looking around at whats going on. It will be interesting to see what they do. Harward is a former navy s. E. A. L. Not sure the difficulty of the job is a concern to a guy whos been a navy s. E. A. L. Workable for his family, professional. I think those are probably both concerns. A navy s. E. A. L. , i dont think theyre always thinking about bureaucratic red tape and Everything Else. They do things in other ways. They face other adversity. Good job, eamon. You hung in there. Thank, joe. Just trying to ride it out. Thats all. I saw that. Thats okay. You going to come back on in the 8 00 again . I dont know. If you want me to, i will. To be determined. Have your people call my people. Okay. President trump addressing stocks hitting record levels since he took office during the News Conference yesterday. Check this out. The stock market has hit record numbers, as you know. There has been a tremendous surge of optimism in the business world, which to me means something much different than it used to. It used to mean, oh, thats good. Now it means thats good for jobs. Hes been consistent on that. Joining us to discuss the trump rally and strength of the equity markets, our guest host is jim paulsen from Wells Capital management. Probably benefitting and enjoying this upward momentum as he closes his eyes about the political environment. But you got to admit youre doing okay. At least smile in spite of everything. Then jason trenner on the other side, founder and chief investment strategist at strategus research partners. Youre probably, i dont know, gratified to see some of the policies ma might be put in place by this guy. I think for the Economic Policy agenda its terrific. The only thing that worries some people now i think your mike we have a problem with your mike. I dont think anyone is censoring you, but i dont know for sure. You never know. So you like the policies, paulsen . I do. Im with jason. I like most of what he says he wants to do. Its just how he goes about doing it. Its mostly entertaining. I keep coming back to i think the bigger thing in the room is amazing economic and earnings momentum across the globe, broadening out. To me, as long as that persists, i think thats the wind under trumps magic carpet. Jim, we know how long youve been talking about inflation coming back. You were way early on that. Commodities are coming back, the job market is tight. We still didnt get above stall speed ever. Now suddenly we are. You see the philly fed yesterday . Does that seem normal to you . Do they seem like they were just ready to happen . I think they were. I think we synchronized economic policies over the last 12 to 18 months across the global, and i think its working. Global Economic Activity is picking up. How about deregulation and tax reform . Oh, i think thatll help. Trump has made a difference. I just dont think hes the biggest difference. Is your mike working now . I think so. I hope so. I would just take a little issue with jim on the confidence side, as someone who runs a Small Business, 50 people. So many decisions and this is true for guys ive talked to that run Large Companies too. Its hard to explain, but a lot of decisions are made about how youre feeling on any particular day about how your business was over the last couple of weeks, about whether at the margin you think your life is going to get easier or harder. So i look at the nfib and philly fed index, and to me thats correctly attributable to the new administration and calls for deregulation and lower taxes. I also would say that the market is responding to the fact that earnings the earnings recession ended at the end of the Second Quarter of 2016. So im also sympathetic to that idea. The basis for the market moving up Global Manufacturing recession, deflation. There are other things there, but as far as a Small Business is concerned, i think theres no i mean, in my opinion, it would be hard to point to anything else other than the prospects of trumps economic agenda. It seems like the key to what youre saying is really right now valuations are only partially pricing in any of trumps policies. Youre both saying that effectively the fundamentals of the Global Economy is really whats pushing markets to records. Therefore, follow my logic, if tax reform is in jeopardy, then the premium in the market that needs to come out is less than we think. I absolutely believe that. And this is i think what worries conservative, people like myself. You hope the president doesnt burn Political Capital on distractions and just goes for what i think is an extremely solid economic program. What do you think are distractions . Do you think the press conference yesterday was a distraction . I dont think that was a distraction. I dont think its probably particularly a good idea to kick sand in the face of people that hate you already. My own opinion. His supporters like it. But you have to play the ball as it lies. You are in washington. You cant change that culture overnight. But anybody who thought he was going to change hes not going to change. He is who he is. Theres been no variability for 18 months with this guy. I keep talking to people i was in london a month ago. Some of the investors are trying to put him on a couch. Theyre asking me what his relationship was with his father. Im saying, like, you guys are missing it. This is not a complicated this guy is going straight down the middle. Hes giving you the playbook. You either got to get on board or youre getting run over. To me, the biggest impression i have of trump is hes bringing something we celebrated in the private economy in the 80s to washington. Creative destruction. When that came in, in the 80s, it was totally uncomfortable, totally unconventional. It challenged all the establishment figures of how we did things, how we managed labor, how we managed inventories. Everything. It created vix and uncertainty and uncomfortableness. But it also, some would say, might have led to the innovative 90s and looking at old problems with new methodology, new ideas. I think thats what hes doing. Everyone in establishment is uncomfortable about how hes doing this, but hes letting us look at old problems with new ideas. Rather than asking mr. China nicely to please play fairly, maybe we take a more Nuclear Option, see what happens. I dont like the Nuclear Option part. We have to change that language. People are celebrating disruptive technologies. Donald trump is a disruptive technology, disruptive person. Hes turning over the changing table. Hes mixing things up. Its so nondisruptive that the fed basically has beens by brother for its been zero. Zero explains everything. You cant live that way. I think its great. I think one of the best things thats happened of late is even the fed is now admitting by their actions that maybe the 2008 crisis is over. I think thats leading to boosting confidence as much as the trump presidency. I think the fed showing in their actions that theyre confident enough is giving private sector jobs. I see a day i dont know. Take your pick. You used to spend the day watching fed speak from any one of the 15. Now you watch a trump press conference. What would you rather watch . Heres our plot chart of fed funds. All that crap. They didnt hit any of their targets, didnt hit any of the dots they said. We hung on every word. Its more fun now. Much more fun. Thank you, jason. Jim is with us for the rest of the show. Coming up, the president of accenture north America Julie sweet is here to talk jobs. And later, david wessel will join us to talk the economy and fed and much more. Then George Mitchell. Stay tuned. Youre watching squawk box on cnbc. Mobility is very important to me. Thats why i use e trade mobile. Its on all my mobile devices, so it suits my mobile lifestyle. And it keeps my investments fully mobile. Even when im on the move. Sign up at etrade. Com and get up to six hundred dollars. Youre a funny guy. Best of the oscars. Funny how . How am i funny . Scorsese finally wins. Could you double check the envelope . Show me best picture. Whats the difference . Show me best actor. I do not take tonight for granted. Thank you so very much. Get all the greatest scripted and unscripted oscar moments on xfinity x1. The oscars, live sunday, february 26th 7ea4p on abc. A huge Food Industry takeover deal could be in the works. Kraftheinz has confirmed its made a proposal to unilever. It does add theres no certainty an agreement will, in fact, be reached. Interestingly, all the shares are trading higher. That would be expensive. You figure that would help. Well, kraft heinz shares moving higher. Unilever is next door to us. Meantime, accenture creating 15,000 new highskilled jobs in the u. S. By 2020. Joining us on set, julie sweet, ceo of accenture north america. Thanks for joining us. Thank you. Are you going to tout with this President Trump . Were going to tout this with President Trump and all the governors of the city wes operate in. Were proud of the jobs were creating. More importantly, were proud of the innovation were bringing. Our strategy is to be the innovation partner for all of our clients. We really see the next wave of growth and competitiveness coming from innovation that leverages digital artificial intelligence. That requires us to be much closer to our clients. Thats what this investment is about. What kinds of jobs are these . What types of people will be hired . Well, let me explain what an Innovation Hub is and ill give you the feeling of it. So were opening one next week in houston focused on that market. Industrial companies, robotics, cyber. Youre going to walk in. Theres going to be a drone running around, showing how were doing were monitoring manufacturing facilities to do predictive maintenance. Youll go to a screen and get a pretend like youre a supervisor in a mine, looking at when workers might be subject to accidents. So in this Innovation Hub, youre going to be sitting down with your clients and collaborating. Then youre going to move next door and create prototypes and build and design and help our clients implement it. The Successful Companies of the future are the ones that are going to be continuously innovating. The jobs well create are across the spectrum of the vision of the strategy. Whats the new business model, what are the issues, consulting, helping implement it, the technology, artificial intelligence, digital. So its really across the spectrum of our business to help create this vision of the Successful Company of the future, which continuously innovates. You were there monday, werent you . I was. This would be great for women. More coders. I cant code. But weve got to do that, right . Absolutely. In fact, we really have been trying to be a leader in advancing women because we think its important for innovation. So my Leadership Team is 50 50 men and women. Last year we hit our target of 40 of our hires are women. For us, diversity is a business imperative. I think thats what you saw monday, that its an economic imperative. Were supporting girls who code and a lot of initiatives in our communities to increase the pipeline of women. We think diversity across the board is really important to innovation. You were with trump and trudeau. Yes. Did both of them seem committed President Trump, you were in the same room with him. Maybe ivanka is turning the screws, but hes sincere . Absolutely. Both leaders really reinforced their commitment. They brought together an Amazing Group of women. We had a substantive conversation where we were sharing, you know, our different programs and takes. Women entrepreneurs. Those are the kinds of things we talked about in this meeting. Julie, the people youre hiring, do they tend to have business degrees . Do they have engineering degrees . What do you need . It sounds like its more science based than maybe it was 10 or 15 years ago. Its really across the spectrum. I actually think of these things always about kind of our people and what it means for them. We hired a homeless veteran that we put through a Technology Training program and is working in our Technology Delivery center. We have data scientists who speak a language that none of us is able to speak. So it will be the spectrum. Thats what actually as a ceo is exciting to me. Were creating jobs for a lot of different people. You met with trump on monday. Youre announcing 15,000 new jobs today. Come on come on, come on. Look, were a great company. Were excited to contribute to america. Come on, it was just a couple days ago. Today is friday. Monday, friday, 15,000 new jobs. Its certainly great timing. Thank you, julie. Time now for todays aflac trivia question. In what year were conversation hearts, candy hearts with messages, first created . The answer when cnbc squawk box continues. Mr. Diaz. Cedure, were just going to make one small incision here, then were gonna go in and remove your 67 corvette. My vette . Its just a gall bladder you dont have. Aflac paying you cash, so you might have to sell that sweet little muscle machine just to cover your rent. More funny juice. But my papa gave me. That. Car. What do you wish you had . Aflac. Ohh, i love doing that. Health can change, but the life you love doesnt have to. Keep your lifestyle healthy with aflac and the wolf huffed like you do sometimes, grandpa . Well, when you have copd, it can be hard to breathe. It can be hard to get air out, which can make it hard to get air in. So i talked to my doctor. She said. Symbicort could help you breathe better, starting within 5 minutes. Symbicort doesnt replace a rescue inhaler for sudden symptoms. Symbicort helps provide significant improvement of your lung function. Symbicort is for copd, including chronic bronchitis and emphysema. It should not be taken more than twice a day. Symbicort contains formoterol. Medicines like formoterol increase the risk of death from asthma problems. Symbicort may increase your risk of lung infections, osteoporosis, and some eye problems. You should tell your doctor if you have a heart condition or high Blood Pressure before taking it. Symbicort could mean a day with better breathing. Watch out, piggies child giggles symbicort. Breathe better starting within 5 minutes. Get symbicort free for up to one year. Visit saveonsymbicort. Com today to learn more. New biwhat are we gonna do . Ys. How about we pump more into promotions . Nah. What else . What if we hire more sales reps . Nah. What else . What if we digitize the whole supply chain . So people can customize their bike before they buy it. That worked better than expected. Ill dial it back. Yeah, dial it back. Just a little. Live business, powered by sap. When you run live, you run simple. Now the answer to todays aflac trivia question. In what year were conversation hearts, candy hearts with messages, first created . The answer, 1866. N new york state is already in motion. Companies across the state are growing the economy, with the help of the lowest taxes in decades, a talented workforce, and worldclass innovations. Like in plattsburgh, where the most advanced transportation is already en route. And in corning, where the future is materializing. Let us help grow your companys tomorrow today at esd. Ny. Gov or keeping a Hotels Guests cuttinconnected. I to 35,000 fans. Businesses count on communication, and communication counts on centurylink. Good morning and welcome back to squawk box here on cnbc. Were live from the Nasdaq Market site in times square. Among the stories front and center this morning, just one economic report on the calendar for today. The Conference Board is out with its january index of leading economic indicators. Its expected to rise half a percent, which would match the december performance. The senate is expected to approve President Trumps pick as head of the Environmental Protection agency today. The vote on Scott Pruitts nomination is expected to take place around midday. Fidelity posted revenue was at a report, but fee revenue took a hit as investors shifted funds to poassive funds. Shares of kraft heinz and unilever jumping this morning after krafts confirmation it has approached the dutch food giant with a takeover proposal. In a statement, kraft heinz says its initial proposal was rejected, but that it looks forward to working out the terms of a deal. So is this like a bear hug. Theyre letting it out. Sounds like theyre my guess, from reading between the lines, is maybe unilever wants a much higher price. There are deal terms out there. Its going to drive the price up. Just beware, were not going to pay what they want. The share structure of unilever, is it only 54 billion, the market cap . The market cap is the same for both un and ul. A 54 billion market cap, either one of these stocks. My guess is its not 108 billion. Although, kraft heinz is 106 billion. Thats still betting a big chunk of the company. Its still a really big deal. I dont know whether you would call this anything other than what it looks like, rationalization of the two operations. I dont know whether its a positive for animal spirits or whether it says for us to survive yeah. Prurp esident trump is goin be stopping at the boeing plant in charleston today. The president harshly criticized boeing over the high cost of its air force one plane. The company, since making inroads with the president by shrinki shrinking costs for that project. Joining us now to talk about President Trumps business le s relations,ed fet relations, the fed, and much more is david wessel. Thanks for being here today. Good to be with you. Weve talked a little about the press conference yesterday. Donald trumps assertion that, look, this is a white house thats running like a finely tuned machine, i believe he called it. Well, i dont think id buy that. I wouldnt want my car to run the way this white house is done. Unless the president can find a way to stop appealing only to his base and give the appearance at least of having an organized white house, then a lot of power is going to shift to congress. There are a lot of republicans in congress who resented president obamas expansive view of executive power. I think some of them dont really trust President Trump or theyd like to take some power back. One possibility we have these very entertaining press conferences, lots of tweets, lots of ceremonial visits. You have to see if republicans in congress can do things like repeal obamacare, do Corporate Tax reform. And part of that is going to be where the leadership is coming from. Exactly. To this point, its been the paul ryan plan thats been put forth. I think the problem is these things are really, really hard to do. Theres winners and losers, factions within the Republican Party. Without strong president ial leadership, its hard to get them done. If the president is creating distractions, if hes constantly beating up on his enemies, if hes having conversations with foreign leaders that produce headlines that werent intended, then its hard for him to spend the time with congress to figure out how to do this. It makes pence really important. Theres a possibility trump continues to do his stuff and the Vice President is the one who gets the work done. Its been interesting watching the tax plan. The president himself has said the cross border tax plan really is confusing as far as he sees it. He didnt make any comments yesterday after meeting with the retailers, but thats a lynch pin for the congressional plan for this. Youre right. I think its going to be very hard to get this plan through congress. The Business Community is bitterly divided. Members of the Republican Party are divided. The senate doesnt like it as much as the house does. If you dont do the border adjustability, you dont have this revenue to pay for the rate cuts. The question is, can they find some way to either do rate cuts and expensing and not pay for it or pay for it with gimmicks or does the whole thing fall apart. Where would your money be on that question . My guess is we wont get the border adjustability, we will get a business tax cut, but it wont be nearly as big as the people have been hoping for. 25 . Or is that too much . I think 25 is possible, but you have to be willing to do away with a lot of exemptions and deductions and credits. You also have to find some pay fors. Are they going to pay for it by blocking medicaid and food stamp, by assuming we get 4 growth . Are they not going to worry about paying for it . What happens to the markets if we only get 25 cut, no border adjustment, or just some sort of watered down tax reform or tax rate cut . I dont think itll have that big a negative impact. I think if theres just a simplified tax cut and less regulations, i think the market is fine with this. You talk about trump having to win more of the global base. Im wondering if he can accomplish that even if he doesnt get done. Lets say the economy continues to do okay. Maybe hes going to win more even though he doesnt do much. I totally agree. The man is skillful and lucky. Hes inheriting an economy that has a substantial momentum. I think the markets are underappreciating the risks here. The risks are that he does something that the markets dont like, that he does something on trade, that he inadvertently gets us into some kind of minor shooting war. The thing thats most interesting to me about the last month is every one of these controversies has been generated internal to the Trump Administration. He hasnt really had to deal with any external shock. You mean unforced errors. Yeah. Theres nothing like a katrina, a terrorist attack, a big market crash where the administration will be tested on their competence. Something bad is going to happen somewhere in the world. Granted theyre only a month into this. But its all dealing with controversies hes created. Theyll be tested when something happens. That may change peoples minds about having a president who says, you know, down on the bureaucracy and the establishment. You know, weve been talking about the fed with janet yellen at the hill twice this week. Is the fed shifting its opinion, as a lot of market watchers seem to think . Are we now getting to the point where were looking at rate hikes coming faster . I think maybe. In some sense, this is now back to conventional monetary policy. You have to decide how to calibrate shortterm interest rates. You dont want to do too much too fast. You dont want to do too little. The president of the boston fed said that they might have to do slightly faster rate increases than were in the dots. Dennis lockhart, whos kind of a centrist, the atlanta fed president , said the same thing. If the economy continues to do as well as it has, if inflation picks up, if theres some prospect of fiscal stimulus, theres a very real chance theyll do more rate hikes than the markets are expecting. You think a rate hike in march is likely . I dont think its likely. I think 40 chance. Thats higher than the market has been. I think three rate hikes this year is still the base case. Theres more likely to be more than that than less. David, thank you very much. Youre welcome. Youre quiet. Just listening. Thats a first. How long were you at the 30 years at the wall street journal. Was there some big wall between you and the Editorial Board . Absolutely, and it had barbed wire on top. As big as the wall trump is going to build . We actually had a wall. Did you see the thing where the mexicans say theyll build the wall did the Editorial Board even talk to you . Say hello in the mens room. Then they wouldnt talk but give you some kind of sign language as you walk away. No. Ive told him this before, my badge did not work to get into the Editorial Board. Most good newspapers have a brick wall between the staff and Editorial Board. Didnt the New York Times ever try to poach you . Is this a Job Interview . Anyway, thank you. Good to see you. Coming up, special envoy to the middle east, senator George Mitchell joins us. Hes way right of david. Anyway, check out the futures at this hour. Weve done well in life, with help from our advisor, we made it through many market swings. Sure we could travel, take it easy. But weve never been the type to just sit back. Not when weve got so much more to give when you have the right financial advisor, life can be brilliant. Ameriprise were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. President trump covered a lot of ground in his first solo News Conference as commander in chief. Lets get into some of the big topics surrounding the white house with senator George Mitchell, former Senate Majority leader from the state of maine, down east. I figured out what that was. You sail east to get there from the rest of the country. Mideast peace envoy, thats what were going to focus on, during the Obama Administration. Its great to have you on. When you saw netanyahu and President Trump together, you were probably watching closely and listening to what was said. Yes. Was that in the realm of a possibility, or did you think there were that were in a territory where its unproductive in terms of the one state, two state. I dont think a onestate solution is viable. I dont think its a realistic alternative. There simply is no way that israel can absorb several million palestinians and remain both democratic and jewish. So i dont think its going to happen. What was the rationale for walking back the two state being the only solution . What do you think trump is thinking there . The thinking was weve been trying to get it for a half century, it hasnt worked, to weve got to try something new, which is not an unreasonable position. The problem is when you analyze the alternatives, thats why the twostate solution survives because there isnt a credible alternative. I dont think its the surest way to get back to talk about a twostate solution is to go the onestate route. The ancient hatreds and hostilities are so deep that the two societies i dont think can coexist. The former Prime Minister of israel has said many times israel should not have to face the choice of either remaining democratic or remaining jewish. I think the only real solution is two states. The configuration of it, all that is subject to negotiation. Watching this play out over the Obama Administration and now the Trump Administration with netanyahu and Everything Else i know the russians tried to influence our election. I think we tried to influence their election to some extent. Netanyahu is a young man. Do you expect him to be there for a long time . And if so, does there have to be a different leader on the other side to get those two dont seem like anything is ever going to happen . Or does netanyahu have to be gone . I think youre right about those two. I spent a lot of time with both of them. Heres the crux of the problem. Netanyahu believes that abbas does not have the political strength or will to enter into and implement an agreement. Hes really not interested in getting into a discussion he thinks is doomed to fail because of the other guy. From the other side, abbas believes netanyahu is not serious about it, that he really doesnt favor a twostate solution, and he cites his evidence as the fact that over the past ten year, netanyahu has been against, for, against, for, now sort of for a twostate solution. So neither is willing to get into the difficult process of negotiating because their societies are split. Both societies are split. The most recent poll shows a little more than half of israelis favor two states, a little less than half of palestinians. A leader who makes concessions to get an agreement will confront tremendous hostility internally in his society. So it may take new leadership. Netanyahu, i think, doesnt have a real threat, except to the right. Thats why he keeps tacking to the right. The only real threat to him comes from that direction. Theres a lot of trouble spots in the world right now. We dont think right now that has not been on the front burner, the palestinian israeli situation. Should we put it on the front burner . Should we allow the inertia of where it is right now to continue, or is it something we should i think its a mistake to view the Israeli Palestinian conflict in isolation from the region in which it exists. Its a region in turbulence. Islam is undergoing a tremendous internal stress and strife, even as its growing. Think about this fact. Of the 7. 5 billion people in the world today, 1 in 5 is muslim, about a billion and a half. When the worlds population approaches 10 billion in about 2060, one in three will be muslim. That internal strife, in a number of areas, will continue. That affects the Israeli Palestinian conflict, which in turn affects the regional issue. You have to view it in a regionwide context. I think its a mistake to think you can just take this into a silo and solve it somehow without thinking about the region. Let me give one tangible example. The palestinians have independent authority to act on all of the issues borders, water, right of return, so forth except jerusalem. Thats a muslim issue. Palestinians dont have a free hand. The saudis, the jordanians, the moroccans, the entire muslim world. Its interactive. I think it makes sense to try to get the other arabs involved. We tried that when i was there. The problem is that each side wants the other to do something first before theyre willing to take a step. Senator, theres some news this morning i hope you can comment on as well. Weve been watching and folks, if youre watching from home, youve seen shares of kraft heinz and unilever all skyrocketing on some news that came out this morning. Krafts confirmation that it has approached the anglo dutch food giant with a takeover proposal. In a statement, kraft heinz says its initial proposal was rejected, but it looks forward to working out the terms of a deal. It goes out of its way to say theres no guarantee a deal will, in fact, be reached. Kraft heinz is the result of a recent combination with kraft and heinz merging back in 2015. This is backed by brazils 3g and Warren Buffetts Berkshire Hathaway. As you can see, kraft heinz shares up by 5. 4 . Unilever shares up by 11 in one case, 12 in another. This is the biggest oneday jump since 1987 for those shares. If you look at shares of mondolez, that had been mentioned as another potential target for kraft heinz for the next deal theyd be doing. Those shares are down. I think buffett is kind of demured from some of those suggestions that others have brought up in the past. Senator mitchell, you were on the board at unilever a while back. Yes, an advisory board. Explain a little bit about what you think, just having been on the inner workings of this. I dont know anything about this offer. I do know yuunilever is a terric company. They compete vigorously here, of course. Theyre very strong in International Markets and particularly where theres tremendous population growth. We have to keep in mind the population is rising steadily. The rate of increase has declined, but the absolute numbers are growing. The numbers are greatest in africa, asia, the middle east. Unilever is very strong in those territories. A deal like this, would that make sense from the companys perspective to be getting bigger . Im so far away from it, i would berelucta reluctant to gi advice. Unilever in particular, just last week they announced 2016 sales that were week. Kraft heinz said they would have to continue to cut costs in order to fight off slowing sales. A lot of these consumer staple companies, while their stock prices had been bid up in the marketplace, seen as a safe haven, the underlying business has been challenged here. A little more detail out of the release. According to uk merger law, they have until march 17th to announce either a Firm Intention or a number nonintention to make a deal for unilever. So they have no later than 5 00 p. M. London time march 17th of this year. So they have a month here to decide whether or not they go for it. I do know paul, the ceo of unilever. A terrific person individually, and i think a very good executive. I feel safe in entrusting him in the decision. How about the Democratic Party . Do you have any contacts with the Democratic Party left . Whos the current de facto head of the Democratic Party right now . Who do you wish it was . Is it Elizabeth Warren . No, i think chuck schumer, nancy pelosi by virtue of their positions. Theyre not going run for president. No, but there are plenty of people who might be running for president. Would you offer any advice to the Democratic Party . Move left or move right . Stay steady, Economic Growth and job creation are the most important elements. The Democratic Party is responsible for most of the reduction of barriers to growth and jobs in its history, Opening Doors of opportunity for all people. Stick to that and well do well. Okay. Thanks, joe. Thanks, senator. Coming up, stocks you need to watch ahead of the opening bell. Stay tuned. That means you can take a universe of data in your case literally and turn it into medical discoveries, diagnostic breakthroughs. Proof that black holes collapse into one singularity. I dont know what that is. But yes. Innovation runs on supercomputers. And supercomputers run on intel. You are super smart. And super busy. Ooh ufo false alarm, eyelash at bp, we empower anyone to stop a job if something doesnt seem right, so everyone comes home safely. Because safety is never being satisfied. And always working to be better. Because safety is never being satisfied. [dramatic ic begins] ready charge charge in chinese charge let your reign begin. Evony, the mobile game. Download now. [ alarm weather. Eping ] [ laughter ] cartoons. Wait for it. [ cat screech ] [ laughter ] [ screaming ] [ laughter ] make everyday awesome with the power of xfinity x1. Hi grandma and the fastest internet. [ girl screaming ] [ laughter ] stick around, folks. When we come back today, President Trump will stop at the boeing plant in South Carolina. Hes going to be delivering remarks at the reveal of the dreamliner today. Our phil lebeau is there. Hell have details of what to expect. Then, tech stocks to buy right now. Rbc Capital Markets analyst mark mahaney with whats working. And here are the futures. After six record sessions for the dow, youre going to see futures are under some pressure. Squawk box will be right back. Trump heads down south. The president visiting a boeing plant to talk jobs and manufacturing. A live report from South Carolina is straight ahead. The tech sector is on a tear. Snapchat prepares for its wall street debut. Three portfolio picks that could make you money right now. Plus, coal country applauding President Trump. I am continuing to keep my promise to the American People to get rid of wasteful regulations that do nothing, absolutely nothing, but slow down the economy. Well talk to a ceo who was in the room for the president s rollback of coal regulations. The final hour of squawk box begins right now. Live from the most powerful city in the world, new york, this is squawk box. Good morning and welcome back to squawk box here on cnbc live from the Nasdaq Market site in times square. Im joe kernen with becky quick and melissa lee. This morning jim paulsen, who is chief investment strategist at Wells Capital management. Lets get a check on the futures. I dont know. This merger is so such a huge deal were talking about. It is not helping with market sentiment, but remember the dow hit six straight alltime highs. Dow is indicated to pullback about 44 points this morning. The s p is indicating down somewhere around five points. Nasdaq indicated down nine. The ten year was about 2. 5 yesterday. That has moderated. The yield is now down to 2. 41. Europe and asia were down. Were kind of responding to the overseas markets to some extent. As joe was alluding to, our top corporate story this morning is a huge Food Industry takeover that could be in the works. Kraft heinz has revealed it has made a proposal to unilever about combining the two companies. It goes out of its way to say theres no certainty an agreement is going to be reached here but thats not stopping the market. You can see kraft heinz shares are up on this by 4 . Unilever shares are traded both in the netherlands and in london. Those shares are up 10 and 11 respectively on this. Weve been talking a little bit about all of these issues. Theres some big Players Behind all of these different ones. 3g and Warren Buffetts Berkshire Hathaway are behind kraft heinz. They just put that company together a couple years ago by combining those two. Unilever has the other thing were watching are people had been anticipating that maybe mondolez would have been the next target. If you look at shares, theyve been down. This morning theyre down by over 5. 3 . In the past, Warren Buffett has told us on cnbc that mondolez would not be a deal theyd be doing any time soon. Back in 2015 he said theyd just taken on a huge bite by trying to put these two companies together and they wouldnt be doing any big deals for some time. Obviously its been a couple years. They are looking for a big deal, but its not the one people had been anticipating. Lets bring in an analyst. How much time have you had to look at this, jonathan . About 18 minutes, give or take. So is it kraft heinz offering a premium for unilever . Is it a merger fee . Do you know what the price did they talk about the price being offered . What does it value unilever at versus the current market cap of unilever . So nothings been disclosed. All thats happened is a report this morning and a followup confirmation from kraft, not a statement or anything detailed, but a confirmation from kraft that a proposal to combine the two groups has been made and unilever has declined that proposal. Thats all we know for sure other than the underlines margin and margin opportunity of unilever. Sounds like a bear hug. They got rebuffed then went public. Is that what happened . Well, it certainly sounds that way. It certainly sounds like a typical opening salvo of a merger approach. Its hard to tell at this point whats friendly and unfriendly. Oftentimes its standard procedure to decline a first proposal. Well have to see. We havent seen a formal response, at least i havent, from either unilever or kraft. A white paper or anything like that. Id expect to see things like that in the coming days. You put these two guysing , together, and the economies of scale would be incredible. Thats why kraft is up, i guess, even if they did have to pay a premium. You know, the way i look at it is a lot like the Anheuser Busch s. A. B. Miller transaction. What this does is a lot more than margin opportunity. You get kraft heinz into longterm Growth Opportunity structurally in developing markets that are very, very attractive. Weve thought theyve been very attractive for a long time. Its a shortterm longterm thing. You spend a lot of time trying to make money and develop markets in things like packaged food, but in my view, the real structural Growth Opportunity is building those adoption rates of highmargin products all around the world. Thats where the money has been made in Consumer Staples in the past 50 years. Theres going to be more so in the next 50. I think thats what this transaction signals. What do you think unilever would want in terms of im looking at a longterm chart here. Were almost at new high territory now, i guess. How much would they want to go friendly, do you think . Its really hard to say. Its really hard to say that. Our target price has been 49 for a long time before knowing anything about this and them wanting to barter the potential synergies kraft has. Ive looked at the ebitda margin at proctor and gamble, which is a caomparable company. So 49 is probably a starting point. It just depends on how much opportunity they see. And of course what equity participation there is, if any, here. This is a very, very big deal. Well have to see we dont know the details on how kraft sbe intends to finance this. This has more ebitda than kraft heinz. The market cap is 106 billion. So this deal itself, even with the premium, is going to be larger than the market cap. Does kraft need to do the deal . How much of a factor is the fact that unilever is an overseas company and kraft heinz is taking advantage of a stronger dollar, weaker pound . I think that is a factor. The currency piece of it. Certainly tax rates and having overhead in europe used to be a disadvantage and now becoming somewhat of an advantage relatively speaking with the dollar having appreciated so much. I think that plays into it. And does kraft need to do the deal . No, they dont need to do anything. They have a 20 to 30 return on net tangible assets. They can wait. They want to do the deal they want that gives them the most longterm opportunity. This is the best idea ive heard in a while, but they can always walk. I just think this is the best idea. Its a bold idea. Its one thats going to require some creative financing. So much for Political Risk and brexit and the dissolution of the euro. Not scaring kraft heinz. Doesnt seem to be. In shampoo we trust. Going to keep using that whether theyre using euros or not, i guess. Is this animal spirits . This is not a defensive, this is an offensive deal. The way you described it, its offensive, not defensive. Absolutely. Yesterday there were a couple comments. Obviously kraft heinz reported yesterday. I think a lot of comments about whether they were going to be in the deal market. They can take their time. They have a great business. Theyre obviously tremendous con sol d sconsolidators. I think this caught everybody by surprise because of the boldness and size of it. Not me. Actually, i wasnt thinking either way about it. Didnt catch me by surprise. One more thing. If kraft was look for a market check to see how people were going to like it, its up 4. If that was a if that was to see how this would be taken, people love this so far. Yeah, listen, any time youve had the track record this particular Management Team has had, combined with the margin opportunity, plus the road map that s. A. B. Miller showed you and the better growth, that would be argue for better combined multiple for the company than kraft heinz could sustainably achieve on their own. I wonder, too, if just the rate structure in the world is starting to move up. If they need to finance this do it fast. Its sort of forcing them to do this and get it in before rates go up more. A lot of that financing was from berkshire and hathaway, which has tens of billions of dollars sitting around. If thats the financing structure behind it, 3g plows in some, berkshire would plow in some. If its based on what they did with kraft heinz. Then theyd have the equity. Jonathan, is mondolez a buy on this selloff . Its trading like its a wa wallflour wal wallflower at the dance right now. The structural opportunity that mondolez represents versus its food peers remains. If kraft heinz doesnt want to be the one to do that now or ever, certainly a proposal with unilever makes their Shopping List bigger, but it doesnt necessarily take it off that shoppi Shopping List. I think theres enough structural Growth Opportunity selling highmargin chocolate and gum to developing market consumers that makes mondolez somewhat attractive in its own right. Now, certainly theres a time function of this and the credibility potential credibility of 3g management. I think that structural opportunity remains for mondolez. Its not a never necessarily. So thats like an independent i know you, i think, john. Where were you before . Great memory. I have my own firm for a couple years and i combined with a guy whos had a tremendous amount of success and whsomewhat of a menr for me in beverages. You know a lot. Good to have you on. I havent heard of the firm. How old is consumer edge . Seven years. Is it already . Okay. That i was surprised. Thank you, jonathan. We appreciate it. I feel like i know a little bit more about whats happening. All right. Phoners, you have to use them sometimes. Hes seen this for 18 minutes. Thats some quick analysis. Phil lebeau. President trump is heading down south today. Tweeting this morning. We know where hes going because he tweeted. Going to charleston, South Carolina. Great place. Sometimes you got to use that phoner, joe. Thats where you have me down here in charleston. We got you too. Have you seen this picture we got of you . Wow. That is wow. Is it still the one from the incredibles where im wedged into the car . Thats a good one. The secret service is doing the sweep of all the camera gear. For now we do not have use of our camera. Well have it later on this morning. Thats when President Trump comes down here to the boeing plant. This is his first visit down to South Carolina since he was down here before the primary. This is friendly territory. He carried South Carolina. Its a bluecollar area. Hes going to be talking with workers in the boeing plant. Theyre rolling out the latest version of the dreamliner, the longest or the stretch version. Whats he going to be talking about today . Certainly wont be as exciting as yesterday during his press conference. Manufacturing growth, which is a theme hes been hitting hard for some time, job kree yarcreation theres some speculation that perhaps he makes a comment about the funding of the export import bank. During the primaries and president ial race, there was a lot of discussion about whether or not donald trump would support funding of the import export bank. Well, hes made it pretty clear that eventually he thinks it should be funded, which is crucial for boeing. For the ceo of boeing, this is his third time seeing donald trump since donald trump was elected. There was once at trump tower, once at maralago when they discussed the payment for the air force one plane, then today. Hell be getting another dose of President Trump. Again, we expect him, as you look at shares of boeing, we expect the president to be down here at about 12 30. His comments will start shortly before 1 00. Not as exciting as yesterday, we dont think. Certainly well be here, and itll be interesting to see what he has to say, especially if he touches on the export import bank. All right, phil. You watch the press conference . Oh, i did. Who didnt . Good time to be in cable news, isnt it . Middle of the day, people were like watching days of our lives and like, whoa. Just no comparison. Absolutely. Mustsee tv. And everybodys sharing in that. Its a love hate thing with the media. Thats for sure. Anyway, thank you, phil lebeau. Lets talk more about the state of labor in the United States and President Trumps new pick to lead the labor department. The former chair of the National Labor Relations Board during the Obama Administration, the second woman to run the organization, joins us. Thank you. I think were having problems. Oh, can you hear us . I can hear you, yes. Perfect. Now we see you. Thank you very much. Sorry for the technical problems with that. Lets talk a little bit about where you see labor headed these days. We were just speaking with phil lebeau, whos at a boeing plant in South Carolina where they just this week voted not to go into organized labor. What do you think about the state of labor right now in the United States . I think the state of labor is uncertain. Its a troubling time, but one thing is clear. I believe over the last few years, weve seen a lot of signs of worker discontent, an emerging reaction to years of stagnant wages, growing inequality, longterm unemployment, not being heard, being ignored. Weve seen this over the last few years with the emerging fact for 15 low wage workers movement. We saw it with the surprising and longstanding support for both Bernie Sanders and donald trump. So i think this emerging worker activism is a positive sign for workers. Whats more unclear is the direction of the Trump Administration on worker issues. Donald trump certainly campaigned as a populist pro worker candidate, but it remains to be seen, really, what the nature of his appointments and what the nature of his policies with respect to workers is going to be. Lets talk about the appointments. You had andy puzder removing himself from the running. The new appointment named by mr. Trump, alexander acosta. You know him personally. I do. We served for about nine months together at the beginning of the bush administration. He was one of three republican appointees. I was a democrat on the board remaining from the clinton years. So we had about nine months. By the time he was appointed, he had about nine months left on his term. While i think he wanted reappointment, the administration put him in another position in the justice department. So we had a good working relationship. I found mr. Acosta to be highly intelligent, to be very open minded, very willing to listen and sit and discuss issues. I found he had a real interest in the law. He was a student of the law. Certainly interested in enforcing the law. Hes not antiregulation or antigovernment by any means. And that leads you to believe what if hes actually confirmed for this position . Well, i think that remains to be seen. I havent actually worked with mr. Acosta in over a decade. But i think for sure based on my experience working with him that he will be open minded, he will be intelligent in the way he looks at the issues, hell be independent at the way he looks at the issues. Hes not someone like mr. Puzder, who comes out of the corporate world. He doesnt come out of the world of finance. His professional career is a combination of public service. He held several positions in government. For the last several years, hes been the dean of a law school in florida. So his position is academia and public service. Chair liebman, did you raise any eyebrows over the past eight years in some of the actions of the nlrb, any of that stuff give you pause or you were 100 behind the activist nlrb of the last administration . Well, i guess i wouldnt use the word activist. I would use the word active. I think the nlrb was enforcing the statute. It was rigorously enforcing the law, trying to keep the law current with a very dynamic and changing economy. The law really hasnt been changed since 1947. Needless to say, a lot has happened in the world since then. I think it was a dynamic board. I wouldnt say it was radical by any means. Theres no way that an nlrb can be radical under this statute because the statute has been unchanged for so long. If you dont give one side enough time to even respond to a unionization and suddenly they only have like two weeks and its sprung upon them i mean, there are a lot of people that would take great issue with what you just said about whether it was activist or not. I realize that. The labor law has always been a subject of deep divisions, deeply held views. At least the country is much more united now. Oh, yeah. Right. Chair liebman, thank you for your time. Quick headlines out of unilever. They released a statement saying its a 50 a share offer. The deal is worth 143 billion. This again according to unilever. The firm is right now rejecting the deal because it undervalues the company. Well have much more after this break. Is it stock cash . Im going to continue reading. Its an 18 premium to yesterdays close. Dear predictable, theres no other way to say this. Its over. Ive found a permanent escape from monotony. Together, we are perfectly balanced, our senses awake, our hearts racing as one. I know this is sudden, but they say if you love something. Set it free. See you around, giulia the market. Redict but through good times and bad. At t. Rowe price. Weve helped our investors stay confident for over 75 years. Call us or your advisor. T. Rowe price. Invest with confidence. Welcome back to squawk box. President trump just tweeting, general keith kehlillogg, who i known for a long time, is very much in play for nsa, as are three others. This coming basically hours after harward pulled himself from the position. Meantime, tech on a tear, hitting a new high dating back to 2000. Its up almost 9 year to date. Joining us now with his top picks, mark mahaney. Your top three are the obvious ones. Netflix, facebook, as well as amazon. You just hold your nose and buy whats working right now . I wouldnt say that netflix is obvious. I think although its at an alltime high, i think its one of the most controversial names in largecap tech. There are enough people concerned about competitive risk, their ability to manage the spiraling content costs. The other ones, google, facebook, amazon, if you look at those names, theyre now three of the six largest names. We think the fundamental trends are very much intact. Google has gone 28 straight quarters of 20 year over year revenue growth. Thats almost unheard of, especially for a company of that scale. Whats new this year is that this is a major investment year. Amazon, google, facebook, theyve all talked about margins down this year. Thats the new wrinkle. Do any of these stocks, facebook in particular, get any valuation lift or depression based on snapchats valuation . Huh, i wont comment on snapchat, but facebook, thats possible. What i find so interesting which is possible, a valuation lift or depression . In the case of facebook, i think ive been saying this for about three to six months. This is about the First Time Since the ipo you could make money on a rerating in the stock. I think thats going to happen because of fundamentals more than anything else. It depends on how senanapchat g priced. You dont normally get that kind of dislocation valuation. Its one of the major reasons its our number two pick in this space. Does facebook need to get into china in order to support a future valuation thats higher than where it is now . No, i dont think so. I think the chances of facebook having any material success in china is very small, even if they were to get in, theres very wellestablished social networks in those markets. It maybe adds a couple tens of millions of subs. They already have 1. 8 billion Monthly Average users. Theyre fine by themselves. They have two of the largest messaging platforms in the world. Thats good enough. So on to amazon, if there was a border adjustment tax, what sort of impact could that have on amazon, or does it matter because amazon could use its leverage to force the supply chain to sort of eat the costs . I dont know if they could do that. I think it would be a negative. Quantifying it is almost impossible. Its much less for a retailer than a manufacturer. Amazon, like every other retailer, would be negatively impacted by a border adjusted tax. So its an issue. They do deal with this issue in europe and a lot of International Market where is they collect b. A. T. S. It would change their Competitive Dynamics it would change their Unit Economics in the u. S. For that matter, it would be a negative. Mark, great to see you. Thank you. So the unilever its 50, as you said. 30. 23 a share in cash payable in u. S. Dollars and 0. 222 new enlarged entity shares per existing unilever share, 143 billion total, 50 a share. Coming up, todays top stories, including what we were just talking about. Stay tuned. Well be right back. Guyhey nicole, happening here . This is my new alert system for whenever anything happens in the market. Kids a natural. But thinkorswim already lets you create custom alerts for all the things that are important to you. Shhh. Alerts on anything at all . Not only that, you can act on that opportunity with just one tap right from the alert. Wow, i guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at td ameritrade. Welcome back to squawk box, everybody. Our top corporate story this morning, a huge Food Industry takeover deal could be in the works. Kraft heinz has confirmed it has made a proposal to unilever about combining the two companies. Check out the shares today. Unilever shares, both those traded in the netherlands and those traded in london, are up around 10 or a little better. Kraft heinz shares also up on this potential news, up 4. 5 . Now, unilever is just out with a statement that says the offer is at 50 a share. Theyre saying that undervalues the company. Thats a premium of 18 from where the shares were trading yesterday. Its a total value of 43 billion. 143 billion. Yeah, sorry. 143 billion. They say kraft says its looking forward to coming to terms on a deal. Theres all kinds of weird rules. Its a crossborder merger. According to london or uk takeover laws, kraft has a month, until 5 00 london time on march 17th to come out with a formal offer or decide theyre going to walk away. Meantime, rich peterson at s p global is saying this would rank as the Third Largest deal ever in the Consumer Staples sector, the largest ever crossborder deal. You got to think that a stronger dollar, weaker sterling, weaker euro plays a big role in the deal coming together at this time. On sale. Like a discount. Yeah. Like your european vacation. Buy in bulk. Thats a lot. 143 billion. Warren could just write a check. They usually have 40 to 60 billion in cash lying around. Im talking about him. Hy him and bill. All right. Lets look at stocks on the move this morning. Shares of Vf Corporation falling in premarket trade. The parent of northface, wrangler, and other Apparel Brands did match estimates with earnings of 97 cents a share, but revenue was slightly short of forecasts. Web md meantime rallying this morning. The medical website operator said it was considering strategic alternatives, including a possible sale. Huge jump were watching for of true car. The buying service reported a smaller than expected loss for its latest quarter. True car also gave an upbeat outlook for the current quarter. Thats a jump of 14. 25 . And hertz was downgraded on worries about weak volume growth and flat pricing. When we return, a big win for big coal. President trump signs a repeal of obama era regulations. Well talk to a man who was in the room, Murray Energy ceo Robert Murray. Squawk box will be right back. Bp gives its offshore teams 24 7 support from onshore experts, so we have extra sets of eyes on our wells every day. Because safety is never being satisfied. And always working to be better. Welcome back to squawk box. President trump signing a repeal of an obama era regulation called the stream protection rule. The measure prohibited Surface Mining within 100 feet of a stream. It tightened requirements for conducting environmental studies and cleaning up mines. President trump commenting on his promise to coal country. This rule will eliminate its a major threat to your jobs, and were going to get rid of that threat immediately. Were going to fight for you like i promised i would in the campaign. You were very good to me, and im going to be even better to you. I promise you that. Our next guest was in the white house for the signing. Joining us now is Robert Murray, founder, president , and ceo of Murray Energy. Good to see you again, mr. Murr murray. I know you were there yesterday. I think scott pruitt is today. If you look how he got out of committee, he had three or four democrats, so thats going to happen. Theyre not going to need Vice President pence on pruitt, which is kind of surprising because the left really had this guy really had a bulls eye on his back. Once hes in, what else needs to be done . This is just the beginning of the coal industry. What about co2 being classified as a pollutant . Is that going to change . Yes, it will, and good morning, joe. This was a great victory for not only the coal miners yesterday to be there at the bill signing by President Trump. I worry about the couple whos got a nest egg trying to balance their budget after working their entire lifetimes, and theyre paying out 22 of what they make for energy right now. That woman thats trying to raise children on one income, that manufacturer of a product. This regulation from the Obama Administration had no environmental ben fiefit at all. It was a deliberate attempt by the radical people in the Obama Administration to eliminate underground coal mining. The most environmentally acceptable way to mine coal. Were down there a thousand feet, joe. They dont even know were down there. But this rule illegally took a 77 law that applied only to Surface Mining and stopped underground mining a thousand feet down. Folks dont even know were down there, joe. So what we have done now, the house and the senate used a continuing resolution act, second time ever since the law was passed in 1996, to get rid of this radical rule that had no environmental benefit but destroyed the lives of our coal miners. Robert, all you got to do is look at i mean, obviously when Energy Prices came down, a lot of stress was put on the coal industry, but there was a concerted effort, some would say, by the administration to just shrink the entire coal industry for Climate Change concerns. Same with leaving the oil in the ground up in the tar sands, even though it wouldnt have stayed in the ground. It was either going south or west, one or the other. But these are all sort of ideological decisions being made based on leaving hydrocarbons in the ground. There was really no Economic Analysis on why this stuff was done. Theres no scientific analysis either. I have 4,000 scientists that tell me Global Warming is a hoax. The earth has cooled for 20 years. What we have, joe, is an Energy Poverty problem in this country. Coal is four cents a kilowatt hour. Warren buffett, who you quoted this morning, said they dont make sense, windmills, but i make a lot of money off the tax credits. Its 26 cents from you, the taxpayer. Its a front. It has nothing to do with the environment. It was all about money. Mr. Trump sees this. He sees the jobs that have been destroyed. He sees that lives have been destroyed. Yes, joe, this signing of this bill yesterday is just the beginning of what he must do to get back lowcost reliable electricity. What can he do eliminate the four cent a kilowatt hour for solar panels. Get it back to a level Playing Field so all types of energy, gas, oil, coal, can compete on a level Playing Field. Get the government out of picking winners and losers, as obama and the democrats have done for the last eight years. Secondly, overturn the clean power plan. Murray Energy Corporation got a stay february 9th last year before the u. S. Epa. Thats my stay. Now that plan has to be overturned. That closes 53,000 megawatts of electricity. Thats four cents a kilowatt hour. We need to preserve the coal industry. It is onesixth the cost of windmills and solar panels. And we knead need to get back te we allow all forms of energy to compete on a level Playing Field, get the government out of it. You give me the ball, and ill compete against natural gas all day long. And god bless my coal miners who were there yesterday. Even if everybody has two teslas in their garage, we had someone talking about how much of the grid, how much of the electricity used by that household it would be like 50 of the house would use electricity just to charge up the teslas. Even if we go green in terms of electrical cars, we need need energy for the grid. Correct me if im wrong, india and china still use coal. Were going to pay 26 cents and theyre going to get 4 cents and that makes sense to people. The electric power load on a plant is up and down every day, morning and night, and through the seasons. Natural gas is finite. You cant put more gas in. Windmills and solar panels are not reliable because they only work if the wind blows and the sun shines. So you need coal. You need coal to put into that boiler as the loads go up and down. Otherwise, people are going to freeze in the dark, people are going to die on the operating table if we dont keep 30 coal in the mix in this country to have a reliable electric power grid. Thats what president obama sees, and he took the first step yesterday. I gave him three pages of what he needs to do yet, but hes made a wonderful start. You mean President Trump. Yes. That was a freudian slip if there ever was one. Obamas been on my mind for eight years. Its been a nightmare. I apologize. President trump. All right. Robert murray. I think pruitt is today, isnt it. Hell get nominated today. Number two and number three are already lined up. All right. Well see. Something is coming next week, the president said yesterday. I dont know whether that i mean, were going to see a lot of stuff once pruitt is in. Its going to be interesting. Theres going to be pushback, so get ready. Thank you. We appreciate your time. Thank you, joe. Coming up, whats old is new again. The hottest new trend among millennials, pen and paper. Well tell you which company is leading the way. Itbut one i think with quesa simple answer. We have this need to peek over our neighbors fence. And once we do, we see wonder waiting. Every step you take, narrows the influence of narrow minds. Bridges continents and brings this world one step closer. So, the question you asked me. What is the key . Its you. Everything in one place, so you can travel the world better. Welcome back to squawk box. Shares of kraft heinz and unilever still trading higher, this despite a statement by unilever that it sees no merit in the takeover proposal by kraft and theres no basis for further talks. Kraft had said earlier that it was looking forward to working out the terms of a deal. Krafts offer valued unilever at 143 billion. Thats about an 18 premium from yesterdays closing price. Again, s p globals rich peterson said this would be the third biggest deal ever, largest ever in the Consumer Staples sector, largest ever crossborder deal. Well continue to watch it through the morning. When we return, putting pen to paper. We will tell you why good oldfashioned notebooks are giving digital planning apps a run for their money. That story is next. Squawk box will be right back. This is where i trade andrs. Manage my portfolio. Since i added futures, i have access to the oil markets and gold markets. Okay. Im plugged into equities trade confirmed and i have Global Access 24 7. Meaning i can do what i need to do, then i can focus on what i want to do. Visit learnfuturestoday. Com to see what adding futures can do for you. Fed chair janet yellen dlifrs her Humphrey Hawkins testimony on monday. In the following week, so the oil sands, not tar sands. People in canada are watching. Thank you for watching. Welcome back to squawk box. Pen and paper is making a comeback in a big way. When did it go out of style, jane . I guess, boy, some of us tell us, ive got one here and some paper here too. Use it every day. Wow. See, you are on the cutting edge again, joe kernen, because the hottest new organizational app is this. Yes, pen and paper. Millennials are boosting sales of notebooks and turning them into decorative art. They call it bullet journaling on pinterest and instagram. And the guy who coined that phrase has created a howto video. We keep track of things, the things weve done, the things we need to do, the things we aspire to. Theres a lot to keep track of. Now brooklyn app designer says by physically writing things down you might be more likely to get them done. And the notebook hes created has more flexibility than any app. I designed it to be able to capture whatever you needed to throw at it. So it can be illustrations or lists or calendars. It has the flexibility to capture those kinds of things, but also provides you with many different methods to organize your thoughts later. This is this week so, does it make a difference . Molly craven is in marketing and says taking the time to write down her schedule is not replacing her google calendar, but it does make her better track her habits and prioritize. I like that it is in one place and that your list from the day before and the day before and the day before are still all there, so you can go back and see, oh, i still have to do that. I didnt get that done yet. So this is moleskin based in italy publicly traded in europe. Sales in the u. S. Of these jumped 12 here. The writer prefers a 1917, guys, who knew kids could still write. Probably test their finger strength, jane. I keep a notebook. I do too. I keep it right here every day. I keep mine for calendar because i have to look a month at a time to see if im overbooking myself. Need it open on the page. Were so hip, jane. Were all so hip. I know. I actually still prefer writing it down in my iphone, so that way when i dont accomplish it i can erase it and theres no evidence that i failed. Now, that sounds millennial. Jane, thank you. You got it. Jane wells. Up next, parting shots from our guest host jim paulsen. Stay tuned, youre watching squawk box on cnbc. Only at t offers you all your live channels and dvr on your devices. Datafree. Entertainment. Your way. Only from at t. Uh, yeah. What is . R, larry. The whole wheelie thing. What do you mean . I just got this baby to get around the plant floor. Right, but now Ge Technology monitors every machine. Yeah, it brings massive amounts of information right to you. So you dont need that. Well, it makes me look young and uh. With it. Time to move on. Oh ill move on. Right into the future. Backwards. Youre going backwards. The futures all around us not just on your little tablet, my friend. A florida man has been arrested and charged with allegedly plotting to blow up several target stores on the east coast in a bizarre attempt to tank the companys stock. Authorities say mark barnett offered an unidentified person 10,000 to put explosives disguised as food items on the shelves of stores in new york, florida and virginia. That person then turned him in. Prosecutors say barnett believed targets stock price would plunge after the explosions allowing him to buy it cheaply before it eventually rebounded. Thats about the stupidest idea ive ever heard. Yeah, theres a mental issue happening there. Our guest host this morning is jim paulsen, chief investment strategist at Wells Capital management. Jim, weve been talking so much about this rally in stock prices. Youve been watching how that correlates with the bond market. Why is that important . In my mind is at what level does the tenyear yield bite. I think what im watching is a correlation between stocks and bonds to help me determine that because right now yields rising is a confidence builder. Its looked at as a good thing moving further away from deflation. I think at some point well start to look at rising yields as a negative of rising inflation. And at that point i think the stock market will struggle. I think its going to be from higher levels but the correlation has been positive most of the last ten, 15 years, but its turned negative three times, becky. Once in late 99, once in late 06 and 07. By putting straight into the it was suggested at that point people worried about inflation for negative for stocks and every time stock markets struggled. Right now that correlation is still positive, but i think it might go negative before the year is out. Theres a big weight on the bond market, and that has been Just International bond prices. Theyve been low or negative or zero and that is a result really act as gravity on our rates as well. I think theyll come up with our rates as well. Might not be as high, but i think theyre going to continue to climb. Are you worried the bond market might give you a false level . Latest cftc data show late short positions in bonds i dont want to say at a record high but multiyear high. A lot of people are short the bond market. So when theres that covering going on it could give you the wrong signal. I think youre right, melissa, theres a risk because weve artificially pegged yields for so long coming out of that now we might have a different movement in the past. Indeed thats one of the reasons i think stocks can go quite a bit higher even with yields rising because were coming from such artificially low levels to begin with. I think people will be surprised how much the economy and the market can handle higher yields for a while. When you say quite a bit higher for stocks, do you have any price targets or any rough ranges . A guess. You know, i think we might run ahead to as high as 2600 this year and the bond yield 2600 . Yes. The bond yield might back up to 3. 25, 3. 5, and then we might crack. This years a little to me like 1987 where you had animal spirits for the first time in the reagan recovery showed up, optimism took stocks and bond yields you picked 1987 to compare . Thank you. Were you around for that . I absolutely was, yes. You know what happened . Yeah. Biggest one day i dont think were going to have that magnitude of boom, joe. Thats good. But thats what were going through. All right. Well see. Thanks so much. Thanks for having me. Its always fun. Thanks, jim. Make sure you join us on tuesday. Mondays a holiday. Good to be here. Squawk on the street is coming up right now. Good friday morning. Welcome to squawk on the street. Im Carl Quintanilla with david faber, sara eisen, mike san tolltoll e santoli. Cramer has the day off. More retail downgrades, the president goes to boeing for the new dreamliner unveiling, futures are red, so is europe on a very weak retail sales number. Tenyears back to 2. 41. Roadmap begit