Transcripts For CNBC Squawk On The Street 20160901

Ended where they began yesterday. It was i guess a quiet august day. Today is september, though. How did the european markets fair on the first day of september. Whatever happened to italy and spain . Come on, guys. But theres germany, france, and, of course, be the uk is the three, the one that was in the red. Theres wti crude, continuing to fall now below 45, well below this morning and that 10year note yield creeping above 1. 6 at 1. 613. Our road map this morning does start with the first trading day of september. If you woke up and didnt look at the calendar thats what the day is. Its a volatile month. Whats going to be coming. The apple tax saga far from over. Tim cook calling the 14. 5 billion tax bill from europe total crap. And european officials are firing back. Shares of salesforce falling this morning. This after earnings that were fine, Ceo Marc Benioff spoke with jim last night on mad money and well get into whats going on there and why that stock is looking down this morning. As for overall stocks futures on the rise as we head into the first trading session of september. Wednesdays decline snapped a fivemonth winning streak to the s p 500 and a sixmonth winning streak from the dow. The nasdaq did rise 1 in august. That posted its second consecutive monthly gain. We talked yesterday, of course, about september, jim, and what we can expect. We made the point that it is typically a more volatile month. August was very quiet. We will have a lot of fed focus. Right. We will get a jobs number tomorrow. Yeah. This is heightened period of sensitivity and one of the things i said last night on mad money is this is when you technology, big for the s p. Comes in with a head of steam in terms of the stocks but the earnings may not. And immediately see palo alto, the other day, king of cyber security, guiding down. And then last night, salesforce with a guide down of the next quarter, not of the year. Thats important. Will come into play later on. But this is what i most fear is that people are lulled into thinking that everything is good when housing is good. Some retail is good. And employment growth is good. Thats maybe not enough for some to be able to handle a rate hike. I think it is. You think it is . Yes. You are expecting what are we talking here, the 20th and 21st meeting of september. And i think its worth while because right now we last time we got british pmi it was extraordinary. It was 53. The exogenous events by nature are surprises, but right now, if youre janet yellen and see a very good number on friday, sigh i see no reason why not to. Pmi, china, august official manufacturing pmi up to 50. 4. That was a bit ahead of consensus. Yes. And expansionary territory, First Time Since october 14. I regard it as very significant. Again, i dont want to see any collapse. Hong kong stock markets been very hot. China remember last year, at this time, we were thinking that its china when we 75 . When a great deal of focus and we saw august last year, of course, reflect that in the markets. But on what was declining growth or concerns about it and a lot of other things that came along with it, that played out through the year. There are continuing concerns, though, about capital flight from the country as they manage the currency down. But i also would say that the companies i deal with in china are seeing a little better, depending on the autos were pretty good, but there was a change in taxes that made the autos good. Yum is seeing business over there. I dont see a turn in the big Capital Equipment businesses that were all used to. I think that honeywell is doing okay. Honeywell is doing well in china. Right. I still dont see owe tus elevator a big business for United Technology doing well. The steel stocks are doing well. Why . Because weve blocked chinese steel. No steel coming from china or korea since we put in the tariffs. So its a mixed picture, china, but last year was a bad picture. Mixed better than bad. Has to do with expectations, obviously. September has typically been the weakest month of the year. Yeah. For the s p 500. And a lot of that is bizarrely a fear of october. Even though october is no at bad month historically. There are individual months down 56 of the time since 1928. Down 1 since 1890s. Now, thats des positive enough to believe it. I usually dont like these things as january goes. Its des positive. One of the reasons is, that the market has been good and people do take profits, but we are not in a position right now where you can just say across the board things are good and that causes people to worry. And i think salesforce were going to have to dwell on it today. Salesforce says that business in july was weaker in the u. S. But they didnt say it was their own marc benioff said its our fault but at the same time who is prepared for that. Were going to get to that fact. I was shocked. I have to tell you, i was shocked only because their execution is usually so superb. We will hear from your interview from him and discuss it. Now look, [ inaudible ] Bargain Store was good. It was sfo replaced tractor supply. Alis Bargain Store. How do you spell ollie. Ollie. Not like the champ. The push cart model. The jet. Com model of algorithm and good Old Fashioned they couldnt sell it ollies and run the circulars. The trading or Something Like that. That was part of my family that owned it. Was it really. Well my grandfather had a push cart. Really have to go there if you want to. I do think that when you have to go down that food chain and look at five below versus ollies, ollies good, five below bad. Dollar general bad, dollar tree bad, walmart good. Its a mixed picture. Mixed picture in september means down a little bit. We need okay. Mixed enough to good that you think the fed will be one of the many different data points they look at to say things are strong enough. Right. And i on retail. That would be a reason to go down 1 as we did when somehow we werent ready for december. In december we had oil not stable. The big conundrum for me, 2. 2. 1 billion oils in storage in the United States. Thats a lot of oil. And we have a lot of tanks. That is not sustainable at 44. Its not. Thats it cant it cant stay there. Now i know the saudis have a deal coming up, theres but saudis are pumping like mad. Saudis at the highest production theyve been. I dont know where this is going. Where are they . Almost 11, 10 point were in the 9s . But we imported 8. 9 and were dropping a little bit. Imported 8. 9 Million Barrels a day. No place to put this stuff. And all the places that we refine and sent to, theyre all filled up. Everybody. All our eastern refineries, traditionally we send overseas, no one wants our gasoline either. The great conundrum of the market how can we say at 44 when we have no room to put oil. The market in the past where you and i have sat here and said its about oil and the market will go down, despite the dividends paid to u. S. Consumerses. Turned out to be somewhat from visa and mastercard, overstated in terms of what we thought would happen. It was. Some of the restaurants felt they got a little bit of a windfall but thats gone away. The Restaurant Group is weak. It is. A lot was even though kind of a conundrum. A year ago we sat here for some time wondering what was happening to the money, saved or spent . A huge number weve been dealing with for quite some time in terms of the difference in gasoline prices now versus call it two years ago. Were not used to rationality. The money is being saved but Credit Availability is growing. Good numbers from st. Louis fed showing credit vulnerable. Easier to get a loan than a year ago with a fico of 700. Credit cards charging again. The apple story in terms of the eu keeps going on. A lot to talk about in apple. Next week it will be back to the actual businesses of wireless phones, but tim cook sounding off to irish media about the eus 14. 5 billion tax penalty against the company in a newspaper interview with the irish independent, cook called the eus ruling total political crap. Heres what cook told irish broadcaster rte about the eu penalty. Its maddening. Its maddening, its disappointing, its clear that this comes from a political place. It has no basis in fact or in law, and unfortunately, one of those things we have to work through. Cook said apple expects to repatriate billions of global profits to the u. S. Next year. Thats an interesting story. As our viewers well know, 215 billion in cash and other lic d liquidity investments are held offshore. The number is absurd. Hes been waiting for the tax holiday so many other corporations have been waiting for examito come back. Maybe get Corporate Tax reform with the new administration in the early days of the Administration Next year. I thought thats what he was betting on is a Clinton Presidency and some sort of like a agreement. Or a trump presidency. Or a trump presidency. Talking about 10 . Mr. Pena nieto put up that wall. A little different from reagan and gorbachev. Wilfred frost i enjoyed the Worldwide Exchange show is fabulous. Yes. Really is a lot of fun for seven minutes of their rivals are seven minutes. Okay. But wilfred did point out that total crap, he is not allowed to say the word crap in the uk. So we think thats a word we can get away with but a word apparently a George Carlin i did not know that. I thought that was standards, allowed to say things were not allowed to say. I listened to wilfred and he made that clear in about 80 seconds of the show. Are we going to stop talking about this next week when we see the 7 and i know maybe youve got an invite now, i dont know if youre going to go sflo they sent me an invite. Hopefully youre not going. You just want to get an invite. Its rsvp. Im jammed on the show. I do point out that yes, we will not be talking about this because its protracted and because meanwhile a story in the wall street journal about apple cutting prices from or cutting its suppliers down in terms of their pricing. And volumes. Well, theyre all subject to being squeezed. Youre talking about pitting skyworks and corvo. Its at same group of companies you always have to say well have they diversified. One of the reasons i like both broadcom, and why i like nxp my travel trust owns that they saw it coming and x p moved into autos, number one semi in autos and procom moved into 3g into 5g actual communications. 5g. 5g . Qualcomm so far ahead. 5g theyre like ready. Wow. Why do you think that stock goes up and hits new highs all the time. Thats just done because its a houdini thing, david blaine, david blaine ceo. No. Go visit his grave. Not that far from here. That is true . Yeah. When we return salesforces guidance weighing on the stock this morning. You heard jim talking about it. Hear what mark ben kneeoff told jim on mad money. A lot more from post nine when we come back. [announcer] is it a force of nature . Or a sales event . The summer of audi sales event is here. Get up to a 5,000 bonus on select audi models. I we worked with pg eof to save energy because wenie. Wanted to help the school. They would put these signs on the door to let the teacher know you didnt cut off the light. The teachers, they would call us the energy patrol. So they would be like, here they come, turn off your lights those three young ladies were teaching the whole school about energy efficiency. We actually saved 50,000. And thats just one school, two semesters, three girls. Together, were building a better california. Salesforce. Com moving lower in the premarket. The Cloud Software company issuing Current Quarter guidance short of street estimates overshadowing a better than expected Second Quarter. Marc benioff spoke about salesforces numbers and outlook. You saw the m a activity that we have done this quarter. That, of course, has weighted on our numbers and yet, of course, we are delivering these great quarterly numbers. Number two, we did have the Foreign Exchange situation that we just talked about and number three, we did see a bit of softness in the United States at the very end of the Second Quarter and these three things together really are kind of what is giving us, i would say, an appropriate conservative view for the third and fourth quarter. All right. Jim, you know Things Company well. You know mr. Benioff well. Fx and seemingly things falling off at the Second Quarter. What do we make of it. Fx they roll their currency into britain. Compound 150 million hit because of the pound shortness. Now, pound decline. So that was to use the word brutal was interesting. Soften, i was kind of to hear softness. The word softness. And in the Conference Call they are talking about basically weakness is the word they used in the Conference Call, keith block, copresident , talked about how a section of july was weak. Im giving marc the benefit of the doubt and face value. Why . Because he didnt lower the year revenue. Right. Third time hes raised. More importantly he did spell out his own execution, and its rare for a ceo to say listen we didnt execute well. Typically what they would say is the environment got tough. He did not say the environment got tough or price competition, but david, it is highly unusual for a high multiple stock to be able to withstand any onslaught if the company does come out and say they had execution risk. I do not know they bought demand ware that mattered and quips. Take their eye off the ball, you cant tell. I know this happened a couple years maybe half dozen an years ago about four years ago and the stock came right back. I am saying that i think that this is going to be made up, that dont forget dream force is starting in october. Introduce this einstein product. I feel salesforce explained it. Analysts were saying there was no clarity. I thought the clarity was there, that we didnt do that good of a job. We are not used to hearing executives say that. They typically do not have execution issues. As a matter of fact, i think theyre the most flawless of all tech. Looking at notes from the research community, been some time since they have had an execution issue so this came as a surprise. It was a surprise. This is a company that fires on all 12 cylindsilcylinders like , not the 750. The verticals are good. I think that the can customer wins are good. A lot of talk about United Health doing good. Big wins. But the fact is that i think people are saying, did marc benioff take his eye off the ball and i would say everyone is entitled do we pull joe dimaggio from the lineup in the 57th game he didnt get a hit. This is one where you give him the benefit of the doubt. Theyve delivered. And they were very candid and straight forward and did not blame the economic environment. They blamed themselves. Had they blamed the economic environment i would have had to call them on that. Ive seen strength, not weakness, since july. Well talk more about salesforce and perhaps m a as well. To ford auto sales with phil lebeau in chicago. Phil . Hi, david. Ford coming in with an august auto sales decline of 8. 4 . Thats a little bit better than the estimate from edmonds. Com which was forecasting a decline of 9. 8 . Keep in mind, the august auto sales are in comparison with august of last year and it was a huge august last year. So almost all of the automakers are going to be showing some type of a decline for ford the retail sales were down 8 . When you look at trucks which have been in demand the most, the decline is looking about 1 to 2 . So overall, not terrible, not great, but its what we expected with august this year. Comparison with august of last year which was huge. Remember, guys, the sales rate what is everybody is focused on and the sales rate is likely to come in somewhere in that 17. 2, 17. 3 million range. Down compared to last year, but any time youre over 17 million i think most will say well take it. Get gm in about ten minutes. All right. Phil, well see you then in ten minutes with gms auto sales. Up next, jims mad dash to the opening to as we count down to the opening bell. Take a look at futures. As we are about ten minutes away from that open here. More squawk on the street coming right ahead. Hey gary, whatd you got here . This bad boy is a mobile trading desk so that i can take my Trading Platform wherever i go. You know that thinkorswim seamlessly syncs across all your devices, right . Oh, so my custom studies will go with me . Anywhere you want to go the markets hot sync your platform on any device with thinkorswim. Only at Td Ameritrade 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. Seven minutes before we get started trading here at the nyse and, obviously, on all exchange you want to talk Campbell Soup in the mad dash. They reported earnings. Mea culpa 24 hours. My ceo on the fly reinventing this company trying to become more naturally organic writes in the release, the decline the surprise in 46 cents versus 50 that were looking for. Why, driven predominantly by execution issues is disappointing up top. She takes the blame. I like that. Decline in organic sales. I dont like 1 decline. Still expects to do 0 to 1 . People hear the numbers and think benioff is apologetic about a plus 25 growth. The fact you have to deliver some organic growth if youre in the food business. Declines in carrot and carrot ingredients. Snacks and simple meals and beverages, delivering significant margin expansion. Wasnt all bad. Did boost the dividend but david, this is a stock that had a great run as they converted the company into more natural and organic. People are finding over and over again Natural Organic isnt so simple. Thats why i thought whitewave got out correctly and hain were still waiting for financials. Hain with the accounting problem and potential issues there. For campbell there continues to be murmurs of more consolidation coming in the sector. Campbells certainly one name you hear from time to time. There is some control there. Right. Thats not as bad as Hershey Trust in terms but i will point out this, david, this is still a Great Company and it has been coveted for years but it is always a bridesmaid never a bride. So pane times people buying the 60 calls, it never happens, but snacks are good, dont overlook the fact that even though its canned soup theyve made some good changes. This bold house farms acquisition was superb. Less sodium in the soup. Yes. Theyve done a lot of right things. I had denise on recently. I like many of the natural and organic products. My wife says look, jim, its still a can of soup. But the fact is, its far more than that. Theyve really reinvented kept. When you reinvent, frankly, sometimes you do make execution errors. Right. And they did. Going to suffer despite what you pointed out, the 12 increase in the companys dividend. Campbell bun of many stocks we will be watching. The opening bell quickly approaches. Stay with us, squawk on the street. What if a company that didnt make cars made plastics that make them lighter . The lubricants that improved fuel economy. Even technology to make engines more efficient. What company does all this . Exxonmobil, thats who. Were working on all these things to make cars better and use less fuel. Helping you save money and reduce emissions. And you thought we just made the gas. Energy lives here. Serena williams. Hi watson. You are a fierce competitor. Ive heard that. I have analysed your biggest matches. Oh really . When down a point, you serve an ace 5. 8 times more than other top players. You sound like a coach. I am not. But i can customize Training Programs based on biomarker data. Watson, thats pretty impressive. You might say i am the Serena Williams of cloudbased cognitive systems. Nah, i wouldnt go that far. Youre watching cnbcs squawk on the street live from the Financial Capital of the world. The opening bell is going to be ringing in about a minute from now, jim. Yeah. Financials, had a very strong performance. Very. In august. You have certainly cited them as being one of the keys weve talked about your belief that we will potentially see a rate increase. Yes. In this month of september. Do you keep buying financials. Yes. And the answer is, is that this group when this as long as citi trades ten bucks below tangible book value, bank of america at tangible book value, jpmorgan mass earnings momentum, as long as wells fargo sees an increase in the amount of mortgage, mortgages these home numbers are very strong and housing punches above, thank you for giving me that line, i think this Group Remains the easiest to buy. Is what i would say. Although it has disappointed in the past just when you thought they were getting the wind at their backs. Look, look, with no rate hike im dead wrong. You need a rate hike. Two rate hikes you will have the best upside surprise of any group in the market. All right. You hear the applause building here, the opening bell should ring at about now. Back at cnbcs headquarters. At the big board Global Citizen celebrating the fifth year of the companygroups festival tea to help kids across america to help kids struggling. Ive looked at habit and done burger war stories, burgers had a big move and now a huge pullback. Right. Look, the Restaurant Group has been so uneven, its really extraordinary. You cant make a single desoings any decision on this. Phil has gm numbers for us. Phil . David down 5. 2 last month for general motors, better than the edmonds. Com estimate forecasting a greater decline in sales. The comparison was with the august of last year, very strong. General motors did see a slight uptick in overall inventory. People will keep an eye on that. Not to the point where its worrisome up from 66 days to 74 days, supply, but one other thing to keep in mind, they are looking at a Light Vehicle sales rate, for the industry, at 17. 2 million. Guys, thats going to be down compared with august of last year. 17. 2 million. Still very strong. I wouldnt say were at the point of saying were seeing a noticeable decline in sales. Certainly were at that plateau moment though. Yeah. Although again, phil, as you point out, thats not a bad number. Anything above 17. We havent hit that that often, have we . Only three times. Only three times have you seen annual sales over 17. Yeah. Theres no thank you. Phil lebeau. August proving to be an odd month. For instance, costco we have to notice down, costco did not do they did a number that was okay and people looking for 2. 4. Not good traffic there. Lack luster results. My travel trust owns it. Weve sold some higher. I have to tell you this is again one of those stories where the inconsistency is maddening. Okay. The inconsistencinconsistency. Now stock down. Look, its a pure overreaction but the stock had a big move after they changed the credit cards, had left american express. But this stock is a stock thats incredibly volatile in a market thats thin. The idea that this can go down say 10 of which i think would be really ludicrous on the small miss is the kind of thing that shows you even though its september not a lot of people around. Typically some want to buy costco say listen great longterm story. People are not thinking long term right now. Theyre not. No. Because i think this is a market where people have kind of just said if you screw up, ill catch you next quarter. Right. The auto numbers. Is there a discount being applied to the automakers in terms of discounting their cash flow back i dont know how many years you want to. Driverless cars. I am. You have to. Right. Look, weve seen lets put it this way, remember there was a moment when we saw pcs hit a level where we just realized that pcs could not grow to the sky anymore. You had to sell the stocks. And its been i mean intel breaking out here but thats because theres other things going on in the semiconductor world. I think that its happening. I think theres too many stories and companies doing things that are very impressive and that the this is not toyota coming in against gm. This is not the reckoning great book, be about ford. But what it does say is that you cant pay as much. The multiples are low. Right. These and the airlines, you know, i had oscar munoz on last night, the ceo, you will see not great numbers from that group. A lot of that is they can generate a lot of cash and not sitting still. Ford is being aggressive when it comes to autonomous. Gm has the significant stake in lift. They have made a number of significant acquisitions. The basics of the idea that were going to have these fleets of Autonomous Vehicles is theyre going to be used a lot more efficiently and therefore a lot fewer people buying cars. I think that when you mention lyft, people understand the reasons those are factors people no longer the moment they turn 16, 17 get a drivers license. There are lots of people we have numbers that actually show that the average age of when people get a car is later. Student loan debt often plays a role and whether you can afford a car. I think that you look at the auto nation numbers, the car max numbers not great numbers in resale value. Yeah, i dont like the group. I weighed in with my travel trust, cash flow numbers this is not the 1980s where you expected regular dividend boost and ford and gm were the income producer for you, 5, 6 yield. Thats not happening. If it gets there because the cash is building so much, become munis. You mentioned oscar munoz the ceo of cups nental united. Had him on yesterday. Been in the job about a year. And that heart transplant just hired a new president. Scott kirby gets fired at american air and then hes hired instantly because hes regarded as oscar said on mad money, if they fired lebron james we will pick up lebron james. Heres what he had to say about business in september. The Energy Sector is hurt, hurting big. The banking world and consulting world continues at a moderate pace. We hope to see the uptick we see when people get back to work. What do we make of that . I think we will see weakness and these numbers that come out for the month and people say thats why these stocks sell. We talked about herb keller and the southwest air and how we felt that these are the [ inaudible ] days. Theres price cutting, competition, capacity coming on. In the end United Continental has improved its metrics. Right. And they all had a great run prior to the stock and they are all now i think earning above their cost to capital which they never did as an industry not only that returning capital. It is a different world. We talked about now it may be moving a bit. We talked about whether 2 billion buyback is the right thing to do for the cash. The cash is burgeoning. Delta. People do not trust these stocks because year over year the numbers are down. And year over year number down situation, equals sell for most managers in this country. They will not own a stock where the numbers are down year over year because theyve had so many where the numbers are up. Right. Jim, this morning weve mentioned, of course, salesforce, weve mentioned campbells. Weve mentioned a couple others. Anything else thats hit your radar that we mentioned costco. You know that we should be keeping an eye on as we get started this morning. Heres one that, you know, ive been very hot on which is walgreens. Put on the focus credit suisse. When i read through it, it does feel that maybe were going to get some sort of movement with this rite aid deal. If we dont, well, suspended animation situation. It is above this is a p e, p e owned a lot of this. But you know what, that could be very interesting. Then just give you something to write off positive. We had numbers of macau yesterday. Sounds weird, in macau revenue up 1 . June minus 8. 5 . I monitor, thank you matt horwin, the flights into mccarron and theyre up very big. Vegas is booming. If you want to do this in a low risk way, do mgm. Thats what i was going to say. Of course you have two companies to choose from now with the rehabbing been spun. They control it. Right. But you can do mgm because thats where their business has focused. Penalized to a certain extent for not having participated greatly in the growth as caesars did also but caesars has itsish auto shus. Las vegas, sands, i have been fascinated with the career of steve wynn who tells it like it is on the Conference Call. He doesnt understand the game. You pointed out mr. Wynn bought stock. A huge amount of stock in the 50s because he had faith and these numbers indicate thats right. The stock had a run. We had some kind of squishness in mckau. If this trend continues how weak is china. Will they bring the jungettes back. Junkets were part of that socalled soft corruption style. So there we go. Okay. Jim, we have breaking news here out of Cape Canaveral. A spacex rocket failure on the launch pad. A plume of smoke could be seen from the distance. Take a look here. I think you can see it now in the pictures. Nbcs jay barbri reports no injuries. But we will have more information on this story as it becomes available. The rocket was scheduled to be launched this weekend. Again, no injuries but not sure about the fate of the rocket. Wow. For spacex. By the way, we didnt talk about tesla or solar city. Theres numbers in the wall street journal reporting they came out the wall street journal reporting about the need to continue to raise cash through whatever means they can at both tesla and particularly solar city. I use ax eyams numbers. A firm that does good work on actual installs. California applications for rooftop solar down 23. 8 month to month. Now down 42 year over year. Thats bed rock for solar city. I mean if you actually people tend to think well, its a musk company doing fine. Its solar and first solar being hurt by the price competition from overseas. You dont want to touch these on an earnings basis. Might want to touch it on emerging markets elon musk is a brillianten. And found an ability to raise capital where he needed it to fund both of these companies. High growth, notice that salesforce is being given the benefit of the doubt. Yeah. Stock is up nicely from the down 5. 6 it was last night. Anybody whos candid enough to come on air and say listen, we didnt do a good job executing i like that. We do. All right. Somebody else we like is dom chu, not that we dont love bob pisani, bob on the floor with whats moving this morning. Good morning, david. Again just to talk about a little bit about whats happening with the markets. One of the traders tell me sarcastically hey the september volatility is back, the s p is up 1 or 2 points. The still markets kind of continuing into the first trading day so far. If you take a look at the early trading action there is a bit of a standout coming out and that is in the cyclical side of things. Weve been noticing overall with modest fractional gains in the stock market overall, that we have seen the financial stocks showing a little bit of at least early month strength to start september here. Also, industrial stocks moving to the upside as well so far in the early trade. Little too early to tell so far. But, Consumer Staples like you talked with campbells probably weighing that sector down, off by about a quarter of 1 . The Energy Sector down lower crude prices, 44, handle on west texas intermediate a focus there as well and one more kind of key to look at here as we kind of wrap things up with the energy trade one of the standouts in august. Well see if it maybe can hold on to those. If you look within the Energy Sector itself, guys, the xle the spider Energy Sector etf has been performing overall. Within that Energy Sector the exploration and Production Companies in the month of august xop is the ticker there, one of the big etfs that tracks it up much more than the oil services companies. So as you take a look at the energy trade well see if those trends continue given the fact that the oil prices try to bottom out in the 44, 45 range for west texas intermediate. Thank you very much, dom chu. I dont know if we can hold there. A lot of issues do a faber report here. A lot of chatter about twitter lately. People can look at the stock price. Its up another 1. 5 . This after a big move yesterday. You got a lot of hedge funds talking to each other and sending around clips of interviews. In particular, one that attracted a great deal of interest was an interview not done here, to be fair, but on bloomberg, on tuesday with ed williams whos a board member of the company, one of its founders some time back. Who in answering the question about whether twitter will remain an independent company said, after and again a lot of emails sending this around he smirked and stalled and said i dont have any comment, twitter is in a strong position and as a board member we have to consider the right options. People are focused on that in particular. As being a sign perhaps of some sort of change in tone, amongst for mr. Williams. Take a look at a year ago to what he was saying no stranger anybody following this company when asked said not at this time. Probably all kinds of legal things i need to know to answer that question properly. So as i said before theres credible potential on twitter and the board will do whatever it needs to do. Draw your own conclugsz if you want. What i will tell you is this about twitter, next week september 8th an important Board Meeting that mr. Williams will be in attendance at along with all the other members of the board. And i have been led to believe that certainly amongst the discussion at that Board Meeting will be the future growth rate of this company and what the options will be if that growth rate continues to be anemic. By anemic i mean what are they going to do, 5 , 6. Can they get the Growth Engine moving at a company that as we know has not seen Significant Growth in monthly users. And that board is well aware of the threat of an activist investor. I know a number theyre taking a look if not taking small positions. Thats what activists do. Dont draw great conclusions that means there will be some big battle here, but they are taking a look with the idea that if twitter does do nothing, lets say, on that front and they believe that there are potentially buyers for the company, there is the possibility come december when the window opens, that you will have an activist there. That is no stranger to the thinking of a number of these Board Members who will be meeting next week and so it could conceivably end up being an important meeting for twitter, one at which at least a number of the Board Members expressed the opinion that hey if were really on a target of growing at this level, we need to think long and hard about our options which comes back, of course, to the to what mr. Williams answer was yesterday in saying, very that very thing. We need to consider the right option. Mr. Dorsey for his part on the interviews hes done most recently with Julia Boorstin on this subject has had little to say, but hes not necessarily in control. Theres the issue of him being a ceo of two companies. For example, iss come down on that, but guys who weigh proxy battles and what side and jim, youre no stranger to this idea. You even asked benioff yesterday about twitter in particular, he didnt answer that question at all. No. I had to. Ill tell you why. We had gone into the discussion about linkedin and why he decided to bid for that, cara swisher breaking that story he had been aggressive on it. He described the situation, gave us parameters where you have social mobile cloud, stock down 50 , window thats going to be closing by calendar year end and property grab and so i looked at that and said well what fits that. Those parameters. Thats twitter. Because the stock is down more than 50 , cloud mobile, social, i believe that asset could be used in many different ways to be able to have much more customer retention. You can use it for customer retention and use it for there could be a cloud, mark has a bunch of clouds, einstein, a new cloud on Artificial Intelligence, Artificial Intelligence predicative component to twitter not used by twitter. There is a conceivably an argument to be made to why crm would be potentially interested. I think should buy it. There are some people that say the daily average user is not going up. 30 Million People are using this every day and everybody else doesnt matter. You can dream dreams about what this thing can look like versus what it is now. Its an under utilized asset by people who are always trying to figure out very small, minusc e minuscule, small think ideas to move the needle ever so slightly. And marc benioff, this could be used as a way to be able to do customer management that only companies would dream of in terms of personal Service Interest a bank. He just met with he had just met with bank of America Management the other day. I could see this fitting in very well with a customer. We will see whether that opportunity arises. I think it makes sense. Thats my idea it makes sense because it fits the parameters. Im looking at the parameters an coming up with that. Well, again, a week from today potentially an important Board Meeting for that company. I would point out no Insider Trading there. Bond pits Rick Santelli at the cme group in chicago. Take it away, rick. Thanks, david. You know, long end, 10s, toying with the top of the recent range. August is the range basically. Two day of 10s maybe more appropriate the one week. Yes, we are touching the top. Bunds no different. Theyve sold all the way off to minus 4 basis points. But dollar index, one week of that chart has been more on the firm side. It looks like treasuries are actually catching up with the dollar which may have had it right and investors psyche and some of the fed speak last week. Dollar yen, this is fascinating. We have one session under 100. 18th of august. Today could be the seventh session in a row the dollar is doing better. The last chart this is the pound versus the dollar from february to give it some distance. The Double Bottom is in place. Still for the most part think the pound will be improving against the greenback. Back to you. Thank you very much. Rick santelli. A preview of tonights cnbc documentary ground zero rising reported by jim cramer after this break. With this level of engineering. Its a performance machine. With ts degree of intelligence. Its a supercomputer. With this grade of protectn. Its a fortress. And with this standard of luxury. Its an oasis. Introducing the completely redesigned eclass. Its everything you need it to be. And more. Mercedesbenz. The best or nothing. It has been 15 years since the 9 11 attacks and a cnbc documentary jim cramer introduces us to a man with a surprising connection to the old and new World Trade Center. We all lost friends that day. You lost a very good friend. Yeah. Jimmy, his name was james martelllo we had grown up since 6 years old three houses a i way and always like brothers, really. Cocaptains of the football team. The best man at my wedding. My wife and i loved him to death. This is jimmys name here. Just one of so many who died on the ground that day. It was overwhelming for greg and for a long time, he couldnt bring himself to return. For five or six years i avoided it like the plague, actually. I was shell shocked. It was hard. So many feel felt that way. Its what he did next that really set him apart. All right. Im going to want to see. Theres look, when you theres 15 years, i taught a lot about this where were you 15 years later from pearl harbor. David, the editor of the new yorker, called it our gettysburg. Should it be anything other than remembrance and honor. What im trying to do in this documentary is put a perspective on, as david also told me, life is messy. Here we are. We are trying put a coalition together that ended up with something that is i think amazing to behold that is respectful and that i want everyone to go to ground zero. Its not really ground zero anymore. Its a go to a 16 acre site that i think has accomplished something that i would never have thought happened which is put both things in perspective about the horror and the sadness, and also restore the luster of a great part of new york and maybe take it to a different level. I loved doing this. It was very hard because i didnt want to go back either. I was fearful. But i was too fearful. I was too fearful. I came back. I said who would want to work there. I came back thinking me. I would want to work there. Well, be sure to watch tonight ground zero rising freedom vs. Fear a cnbc documentary airing at 10 00 eastern right here on cnbc. Got stop trading coming up with jim. I know youre my financial advisor, but are you gonna bring up that stock again . Well you need to think about selling some of it. My dad gave me those shares, you know. He ran that company. I get it. But you know i think you own too much. Gotta manage your risk. And youve gotta switch to decaf. An honest opinion, even if you disagree. With 13,000 financial advisors, its how edward jones makes sense of investing. Time for stop trading. Siena beat the number and guided down. Stock up big. Five below a company that makes inexpensive trinkets sells them and this is a company that i read it and said this was a good Conference Call. Why is it going down. It shouldnt have been going down. They guided a little weaker, but i think this company is a remarkable company. When Dollar General and dollar tree blew up those stocks were down big. Here give them a pass. And they seem to be getting it. What do we have on mad tonight . I am going to digest give you the whole thing on the salesforce. I want to go back over this because people have to understand not all shortfalls are created equal, david. Understood. All right. Crm. And then my doc tonight. Are you back tomorrow . Here tomorrow . Im here. All right. Coming up, former u. S. Ambassador to mexico offers his perspective on donald trump. Keep it here. Welcome back to squawk on the street. Im david faber along with sara eisen and mike santoli live from post nine at the new york stock exchange. Carl quintanilla has today off. A look at how were faring on the markets as you see, lets call it flat. Can we do that. Were up on the nasdaq. A look at oil which has been quite weak lately. You heard jim on the last hour of squawk on the street talking about the huge reserves held here in the u. S. At alltime highs and wondering whether he can hold that 44 level. We will have Economic Data by the way crossing the tape. Right now i believe Rick Santelli, do you have those numbers . I do, david. Yes. Theyve come and gone atheres surprises here. If i look at the july read on Construction Spending its a lot less than the half of 1 , goose egg, unchanged. Do we get horsepower on the revision. Down 0. 6 for june. Turns out to be up 0. 9 , up 1 . A big 1. 5 swing. Now heres the bad news. Very low read. Second lowest read of the year when it comes to ism at 49. 1. Only number lower was july at 48. 2. This is the third sub50 read and, of course, that sequen sequentially follows 52. 6. There are some spots that we should underscore with employment coming out this week, the Employment Index which is already under 50, move further under. Last look it was 49. 4, now its 48. 3. If we look at prices paid, 49. 1 is the number following a im sorry thats new orders, 49. 1 versus 56. 9. So a real deterioration here. This looks like chicago than the National Number and we want to pay close attention because rates were starting to move higher, lets see if they stall in their tracks. Back to you. Disappointing number for sure. Rick, thank you. We do also have breaking news this morning out of Cape Canaveral were finding out about. Morgan brennan is a few miles from there. In Florida Tracking this story. Morgan . Hi, sara. Take a look at this we will show you video that was just shot a short while ago, a spacex explosion that took place a few short miles from here at Cape Canaveral air force station on a launch pad. This is likely very likely the Spacex Falcon 9, scheduled for the amos 6 mission an israeli satellite that spacex was scheduled to launch into orbit this saturday at 3 00 a. M. Weve reached out to spacex for comment and still waiting to hear back. So currently unclear what exactly caused this explosion. But the good news here is that nbc is reporting there are no injuries. Keep in mind any time Something Like this happens it is a setback for the company and this case, spacex, and not just in terms of the mission itself, which keep in mind had been delayed a number of times already, but also, for Broader Company timelines. Again, just a few short miles from here, spacex rocket exploding on the Cape Canaveral launch pad. Back to you and we will bring you details as we get them. A lot of smoke blowing out there. Thank you for the update. We will check back in as we learn more. Just hours after meeting mexican president Enrique Pena Nieto in mexico city donald trump reiterating his tough stance on illegal immigration speech in phoenix last night. He called for a Deportation Task force. Have a listen. We are going to triple the number of i. C. E. Deportation offices. Within i. C. E. , i am going to create a new special Deportation Task force, focused on identifying and quickly removing the most dangerous criminal Illegal Immigrants in america. Lets talk about all this for more we are joined now from washington by democratic strategist morris reed, former rubio Senior Adviser alex coneit and Trump Pence Campaign Senior Adviser boris epstein. Boris, start with you since youre here. Sure. What happened to the softening to use trumps word, in the immigration policy . All of that softening, talk, the media that was zeroing in on any one word. Mr. Trump has always been consistent on immigration. The first step in terms illegal immigration is to build a wall and mexico will pay for the wall. Next make sure all Illegal Immigrants that are criminals are deported. End sanctuary cities, including this one, around the country, in which Illegal Immigrants are able to roam free. End catch and release. And make sure everify is put in place and mandate all over the country. Thats been consistent since day one of Donald Trumps candidacy. One thing we dont know, good to get more details on the plan but dont know how hes going to pay for it. The wall, which there seems to be some confusion after the mexican visit yesterday and the Deportation Task force that he mentioned last night. Hes talking about tripling them out of i. C. E. Agent ps were seeing just under obama term, 300,000 Illegal Immigrants or criminals have been allowed to roam free in the last several years in this country. Ice needs more support. As far as the wall is concerned this was a first meeting yesterday with president nieto. You have the meeting first and get the check. The paying for the wall was not discussed and the wall was. Even president nieto acknowledged we need a barrier between u. S. And mexico. Hillary clinton said the same thing in 08 before we flip flopped on it like shes flip flopped on Everything Else like tpp and Everything Else. Its a choice between donald trump who will keep American People safe and secured and employed and Hillary Clinton who wants 100 day amnesty, 550 increase in Syrian Refugees and not have a country again. Morris, ill let you respond to any and all of that. I dont think its necessary to respond. Boris is consistent with the talking points that Republican Party has handed down. I think that Donald Trumps play to his audience in phoenix, played to his audience in mexico. There is a problem with our border system that needs to be addressed. Im not sure threatening and telling, bullying people is the way to go, but there are problems with our immigration system that need to be addressed by both candidates and need to be thoughtful, they need to be comprehensive, and they need to be consistent to what thats not going to be an impediment to the Continual Growth of our economy. So i think that both candidates, donald trump and Hillary Clinton, need to really look at this comprehensively and do whats in the best interest of the economy first, and safety as well. Alex, ill turn to you now. Republican party, who he spoke to last night, and who its resonating with. I think yesterday was the most interesting day of the campaign so far. You saw mr. Trump make his first foreign trip going to mexico. It was a very successful trip. Even clinton supporters would acknowledge that trump looked good on that stage in mexico, looked president ial, probably the best moment of his campaign so far. And then you had the rally last night where he was as the democrats were saying talking to his base, getting back to basics, i think on a trajectory, mr. Trump is losing this campaign, on a trajectory to lose in november. He has to get back to basics. Yesterday was a good day because he got the images of him looking president ial and then also talking to republicans reminding them why he he thinks republicans need to support his candidacy. A lot still arent. Alex, my good friend to disagree with you in terms of the trajectory. Look at the polls, donald trump gained 7 points in the in the fox news polls and gaining in the rasmussen poll and up in the l. A. Polls. Doing well in florida. Ohio. He is. Pennsylvania. As far as the trajectory, i would say that if anything, Hillary Clinton is absolutely losing and Donald Trumps polls are sky rocketing because the americans see the binary choice between Hillary Clinton and w. H. O. Is a tired candidate, doesnt have fresh ideas and donald trump who is bringing the few ideas. I was just going to say the Electoral College is very challenging. I think anyone would acknowledge that. And currently, hes trailing in the polls. I dont think that he he could still make up ground and part of that starts with bringing republicans behind his candidac candidacy, getting 80 or 85 support, needs more than 90 for this to be a close race. If you look at income k you guys know were up in North Carolina now. Boris you know as well i know up in michigan and ohio. Good, morris. My colleagues know that polls really dont matter. Its a snapshot in time. Right. It has nothing to do with whether this race will be won or lost by either candidate. What both candidates needs to do is try to focus and resonate with the American People. There is still some anxiety in the economy. Whoever is going to be able to make the case to those americans the swing states americans in ohio, michigan, pennsylvania, arizona, whoever can make the case theyre the best canndidat will win. Donald trump has been up, weve been down, theyve been down, it doesnt matter. The economy who connects in the last three weeks of the campaign. 68 days to go. Hearing more from trump on the plans for Economic Growth and the fact that we have not seen a year in the Obama Presidency of 3 growth. Shouldnt he be talking more about that . Of course. And that was part of the discussion. Even today were talking to the veterans in this country who have been hurt by the obama economy, of course donald trump is talk about the economy and simplified tax bracket, simpler bracket, four brackets, 15 Corporate Tax rate and the fact that we need jobs in this country. An immigration debate is a trade economics debate. This country has lost 700,000 jobs to nafta and we need those jobs to come back. Just under tpp we would lose 2 million more. We need to fix that and make sure Hillary Clinton is not in place. Shes against it. She was for it now maybe against it. On clinton on trade and how she will frame the Economic Growth case. Listen, she needs to really hone in on her message and i would agree with my colleagues having said this but until shes able to get these issues like the internet and all these emails behind her she allows trump to poke at her she needs to focus on the Economic Issues that matter. There is anxiety in pockets of our country and whoever addresses them will win. You have donald trump and clinton who are putting ideas forward but theres so much noise that no one is paying attention to what theyre saying substantively. Change the narrative to seem focus on what matters and connect with them and try to win this race. Hose are good points by morris. Hillary clinton has been around for so long show, so she cant make the argument shes going to change things. Thats what donald trump is going to do when elected president. We can talk about this and we will much more, thanks to all of you for weighing in here. Morris reed, alex coit in and boris epstein. Thank you so much. Apples ceo tim cook speaking out against the European Commissioner a ruling apple should pay 14. 5 billion in backs taxes to ireland telling the irish independent newspaper, quote, no one did anything wrong here and ireland is being picked on. It is total political crap. Cook spoke with the irish broadcaster about the ruling. Listen. Its maddening. Its maddening, its disappointing. Its clear this comes from a political place. It has no basis in fact or in law. And unfortunately, its one of those things we have to work through. Cook also said he may repatriate some of the billions of cash that apple holds offshore as early as next year. The tough antitrust cop of the European Commission that handed down the ruling responding to that in brussels this morning saying this is not politically motivated and defended the idea that the European Commission is overstepping when it comes to National Government policy and said this is a european matter and involves profits made or at least reported here and so she has total authority to do so. This what is we do. I think the final piece about cook saying they may repatriate billions to the u. S. Really is the neggette of news here. No commitment in the direction but if he wants to strike that tone thats a possibility. Is that anticipating some kind of lower tax rate on repatriated earnings. Or do it at a full tax rate, 216 billion in cash and lick keds securities overseas. A number almost hard to conceive of. Worried 60 billion for the purpose of not bringing the cash back here. Maybe waiting for tax reform. Refreshing to hear him say political crap. You never get to hear ceos talk like that but how much frustration there is. Coming to the u. S. In september and going to be meeting with treasury secretary jack lew and done so in the past. Clearly they do not agree on the results here. They dont. I think its interesting that really, the European Commission has been isolated in this. A lot of criticism from different directions. Doesnt mean theyre wrong. Its interesting everyone is willing to join together and criticize. The mechanics of this decision at least. Yeah. A huge show ahead it says here. Were going to have more on trumps visit to mexico and whats ahead for clintons meeting. Well speak with the former ambassador to mexico, earl anthony wayne. Plus, tonight watch ground zero rising freedom vs. Fear, thats a new cnbc documentary, reported by our very own jim cramer that airs at 10 00 p. M. Eastern here on cnbc. In honor of the premier we will speak with the designer of the 9 11 memorial michael arad. Stay with us. Much more ahead on squawk on the street. When whirlpool builds an appliance, they put everything they know into it. But once its sold, there usually isnt a way to keep improving that product. Today, whirlpool can analyze iot sensor data from connected appliances on the ibm cloud. So they can continuously learn how customers are using their products. And how the machines respond. Harnessing data to make great products better thats what the ibm cloud is built for. Markets are awaiting tomorrows jobs number but we could be in for a volatile month. Historically september seen average up or down moves of 4. 5 making it the second most volatile month of the year. For more on the september trade were joined by Cantor Fitzgerald bill nickels and hans, global head of Investment Strategy at stifel wealth and investment management. Nice to see you here. More volatile month than the one we came from which had very low volatility. Your expectation is for Economic Growth to pick up a bit. Whats that going to mean . I think were going to continue the path weve been on for the better part of this year which is an economy that continues to move higher holding unemployment lower and with it putting pressure on prices and essentially meeting the feds dual mandate. At some point they have to adjust their Interest Rate policy accordingly. Is that september or not . Who knows. Its like counting the number of angels that dance on the head of a pin trying to figure that out. From an investors perspective set what you think their policy will end up being, and then match your portfolio accordingly. Which means what . In our case what weve done is weve been under weight, large cap u. S. Equities and weve been under weight, bonds. So it forces a slight overweight to cash and weve kind of put most of our fixed income assets in shorter duration securities at this juncture, preparing for what we think will be an inevitability. Right. Youve lost some opportunity there though this year if youve been doing that, havent you . Overall between our Capital Commitments in the year, tactical commitments, owned gold, took that off had a nice gain, had enough equity exposure and enough credit exposure to make the overall portfolio run ahead. Bill, let me get to you. Obviously the fomc meeting is going to be a key one. What are your expectations . Well, i think first we have to get by tomorrows number and if you get, you know, something 180, 200, probably raises the probability for a september move. But right now were still seeing a 40 . Its still 60 40 against them moving in september and almost assured a move in december. But well see. I mean, a solid jobs number tomorrow all of a sudden no other Economic Data in between and all of a sudden looking at a september rate hike which would be interesting. Bill, you know, the August Action as calm as it was below the surface you had this pronounced move towards cyclical stocks, financials, the markets seeming to try to trend in that direction perhaps, i wonder, where are your clients seemingly positioned . Its been so important this year to know what built in expectations there are among investors. Is everybody on this cyclical trade as far as you can tell . Well, its a grinding rotation and you saw everybo everybody the banks and if you were lucky enough to buy them on brexit day you got a 15 rally in several weeks. Youve been able to participate. Energy, very much unloved last year. It was marked to the lows in january. Obviously with crude rallying above 50 to 54, bounceback in energy and youve seen it go the other way with crude down to 44 all of a sudden down 5, 6, 7 off the highs. Theres a grinding rotatiorotat. The market is comfortable moving sideways to slightly higher. Sideways for two months. But depending on what group youre in, its made sense to take some money off the table, utilities, telecoms ahead of themselves and pulled back, 5, 6, 7, 8 . Seeing moves in the underlying groups with sideways action in the overall index. Did you guys see the manufacturing number that just came out at the top of the hour . Below 50 which shows contraction. That was a surprisingly weak data point. Yeah. Something to worry about there. Came in weaker than expected. I looked at the history of that number. I read after it came out. What its interesting we saw something similar last time this year, but yet it didnt portend anything greater for the economy. Its what, only 10, 12 of the economy, the rest of it is service based. The numbers there seem fine. So, you know, its a data point. In other words the fed wont worry about a single manufacturing data point like they would jobs . Im sure theyll worry about it. Build they do something about it is a different matter altogether. I think overall they could comfortably raise Interest Rates but theyre not calling me. Bill and hans, want to thank you both for joining us. Nice to be with you. When we come back, chinese Ecommerce Companies expressing worry over antiglobalization sentiment ahead of this years g20 summit. We will hear from alibaba founder jack ma. Shares of Campbell Soup, the food company here getting hit down almost 5 after reporting earnings and a slight quarterly fall in sales calling performance of its fresh foods disappointing. Had a bit of a carrot issue, had to write down some of those carrot assets. Ahead on squawk on the street. Alibaba founder and executive chairman jack ma speaking out ahead of the g20 summit in china. Eunice sat down with mr. Ma and joins us with more from that interview. Hello, eunice. Hey, thanks so much. Well jack ma is here to chair discussions with hundreds of businesses around the g20 summit and the g20 summit is coming at a time which is a challenging time for the Global Economy but told me he is positioning the company well for the future. As you guys know, he has stepped back from the daytoday running of the company but still does shape the Strategic Vision and said he wants the company to move further away from the core business of ecommerce here in china and into new areas, such as cloud computing, finance, as well as logistics. This is what he had to say. We are infrastructure of commerce in china. We already gone from ecommerce to commerce. So were giving up ecommerce platform so everybody Small Business can buy and sell. Second were building up is efinancing. We are giving loans and giving Financial Support to everybody in china. We have, you know, more than half billion people using our l ali pay and finance centers. We are building up logistic centers, any business in the future, you want to use cheap and sophisticated logistic system. And he also said that that diversification is going to be even further reflected in the way the Company Reports numbers. Currently he said that we will see the company no longer relying so heavily on gross merchandise volume and a key gauge for ecommerce firms and said the company is going to really look more closely at four segments and try to break out the numbers that way. This is what he had to say. When people focus too much on the gmv, and then they forget about we have a much bigger business on the financing. We have a much bigger business on cloud computing. We have a much bigger business on the entertainment side. So i think in the past two years, we are learning how to communicate with the investors. Were so popular in china, such a big household name in china but investors in the states dont know anything about us. And he said that the way that the reporting is done is really essential to try to communicate better with american investors. Another, though, message that he had for the g20 leaders here was that globalization is very important and without it he said would be a disaster of course. Weighing in on a very key issue here, the concerns about rising trade sentiments. Over to you. A message i think were going to hear a lot more of this week as g20 kicks off. Thank you. Always good to hear from jack ma. Lets send it to Morgan Brennan in florida, getting word now, from spacex, on this explosion. Thats right. So in regards to the spacex rocket that exploded this morning a few short miles from here at Cape Canaveral, spacex is confirming that in preparation for todays static fire, there was an anomaly on the pad resulting in the loss of the vehicle and its payload. Per standard procedure, the pad was clear and there were no injuries. This was the Spacex Falcon 9 scheduled to take the amos 6 satellite into orbit this saturday at 3 00 a. M. It was made by Israel Aerospace industries for Israeli Military use. Also, facebook had a 95 million deal over the next five years to get regional coverage through that satellite for internet. Org. Weve reached out to both companies as well. Were still awaiting comment. I can tell you a source telling me that quote unquote amos 6 is gone. So that is, again, spacex confirming the rocket explosion that happened here at Cape Canaveral this morning. Back over to you. Thank you, morgan. Interesting, satellite was on there as well. Total loss. All right. Coming up, the former ambassador to mexico tony wayne, will have his take on Donald Trumps meeting with president pena nieto. Youre watching squawk on the street. Stay with us. Im sharon epperson. Your news update at this hour. Spacex has confirmed a rocket explosion at its launch site in Cape Canaveral, florida, this morning in advance of a planned saturday launch. Spacex says there were no injuries but the rocket and payload were lost. Tropical storm hermine pounding st. Petersburg, florida, overnight. Heavy rain causing wide street flooding. The National Hurricane center says areas can expect between 10 and 20 inches of rain. A Tropical Storm warning has been issued from the east coast from florida to south carolina. Walmart announcing it will launch its Winter Holiday Layaway Program on friday. Customers can put items as low as 10 on layaway with a 50 minimum basket and have until december 12th to pay off their account. Georgetown University Says it will offer an admissions edge to descendents of 272 slaves. This as part of its ongoing process to acknowledge and respond to its historical ties to slavery and will engage with the descendents of slaves in the ongoing effort. Thats our news update for this hour. Over to Bertha Coombs at the nymex with the eia inventory report. Thanks very much. Sharon, weve just got the numbers on natural gas. Little bearish, 51 cubic feet billion cubic feet injection. Slightly less cooling demand last week in part because of a few power plants were down. Nonetheless, nat gas right now extending some of the losses this morning after a huge run up yesterday on the prospect that we will continue to see hot weather in the weeks ahead. Taking a look at oil, the Energy Complex overall under pressure p big problem with Oil Continues to be we have an awful lot of production, an awful lot in shortage. Steven short saying were entering into hunting season for the oil bulls, particularly after wti nymex crude crashed through its 50 day moving age. The next support level is at around 40. 81 a barrel. Back to you. Below 44 right now. Bertha, thank you. After a whirlwind trip to mexico donald trump took the hard line when outlining his immigration plan in arizona last night. Offering no path to legalization and calling for the creation of a Deportation Task force. As for his signature issues, since day one, the border wall, here is gop nominee donald trump. We did discuss the wall, we didnt discuss payment of the wall. That will be for a later day. We will build a great wall along the southern border. And mexico will pay for the wall. 100 . They dont know it yet but they will pay for the wall. At the same time mexicos president reiterating that his country will not be paying for the wall. And joining us with more insight on this issue and the entire election is the former u. S. Ambassador to mexico, tony wayne. Ambassador wayne, welcome, good to have you. Great to be here. Thank you. The Washington Post headline goes with trump talks tough in arizona and softly in mexico. How would you characterize the last 24 hours of donald trump in . Theres been a lot more positive attention to the overall relationship in the past couple of days between mexico and the United States. This is the relationship that touches the daily lives of more american citizens than any other relationship in the world. We trade over a Million Dollars a minute. 5 to 6 million u. S. Jobs depend on what we sell to mexico. Mexico is the country, the second largest buyer of u. S. Goods. So this is a really important relationship and its much more complex, much more important to the u. S. Than has been clear and the Campaign Rhetoric up until now. Having said all that, do you agree with donald trump, though, that mexico has benefited more from nafta than the u. S. . I think that we can see that all three of the countries that are members of nafta have benefited significantly. If you look at the serious economic studies of nafta, you find in the agreement that theres been large losses of jobs in the United States. Those losses of jobs in other studies are attributed to trade with china and to the introduction of new Manufacturing Technology in the United States. The irony is that the number of manufacturing jobs in the u. S. Has been declining for decades. At the same time, the output per worker has been going up because of this new technology. But the new technology requires fewer workers and it requires workers that are better trained. Ambassador, you highlight the economic links and the importance of these connections. You know, one thing that maybe not talked about as much is u. S. Employers who may employ many immigrants, mexican and others, faced with Something Like donald trump is proposing here of constant cruteny scrutiny of their credentials and making them always under pressure to try to find undocumented immigrants, is that going to be a Business Concern . Youve already heard agra business say this would be a big problem . Well, agriculture businesses regularly said they would like to have a clearer system for allowing the legal presence of workers who come temporarily to help them out in their harvests. And i think other studies have found that that might be the same in service industries, restaurants, and similar kind of industries that need this kind of skill level for their jobs. I think that there is a lot of use that could be made productively in the u. S. Economy of people at lower skill levels which would include immigrants. But also u. S. Citizens. Wasnt the goal of nafta to get u. S. Companies and manufacturing more competitive . It strikes me that 22 years after the passing of this, mexico is still heavily dependent op exports and most of those exports go to the United States. So is there scope for renegotiating this for more modern economy and get u. S. Firms more competitive. I think first you have to look at the fact that trade between canada and mexico and the United States has grown about four times during that period. So theres been a tremendous amount of growth. And in if you look at the history the number of u. S. Manufacturing jobs actually grew for the first years of nafta through the 1990s. I think a change came when china entered the competitive field in the world and they were a challenge both for the United States and mexico. But both countries have adapted and a number of the studies that have been done suggest that we were more competitive because we could partner with mexico to create these production chains that spanned both countries and all of north america and that made our products less expensive and we focused on Higher Technology jobs. You also know well, im sure, that manufacturing jobs tied to exports in the United States pay 18 more than other jobs. Similarly jobs in the advanced manufacturing tech sectors pay more than jobs do in the broad manufacturing sector. It could be a whole long debate and an important one. Thank you for joining us. Well leave it there for now on nafta. Ambassador earl anthony wayne, good to see you. Thank you. Thank you. When we return, its been just about 15 years since the 9 11 attacks and the new World Trade Center is up and running. Jim cramer takes a look at the redevelopment of the site in a new documentary ground zero rising freedom vs. Fear airing tonight at 10 00 p. M. Eastern. Plus we speak the architect of the 9 11 memorial michael arad. More ahead on squawk on the street. Ppening here . This is my new alert system for whenever anything happens in the market. But thinkorswim already lets you create custom alerts for all the things that are important to you. I guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at Td Ameritrade. One popular portfolio hedge has lost more than half of its value this year but is there still a case for opening it . Well discuss at tradingnation. Cnbc. Com. More squawk on the street coming up. 15 years after the 9 11 attacks the World Trade Center is back in business. Jim cramer takes a look at the redevelopment of the site in a new documentary ground zero rising freedom vs. Fear. How big a job is this monetary, do you know . Our phase of the project close to 55 million. 55 million for marble and thats just for starters. Look how the costs, a mix of public and private money, add up. The completed oculus. One World Trade Center. On the drawing board, 2 World Trade Center. Three and four world trade. And, the 9 11 memorial and museum. All told, some 14 to 16 billion in public money. Billions more in private investment. As head of the Port Authority of new york and new jersey, pat overseas the redevelopment. Though much of the budget was set before he took office. For example, the oculus. How do you justify 4 billion and can the people get their money back . Who paid for that . I cant justify 4 billion. Nobody can. Ground zero rising freedom vs. Fear premiers tonight at 10 00 p. M. Eastern here on cnbc. Now live from the 9 11 memorial, its designer michael arad a partner at handle architects. Nice to have you with us. Its been a number of years since the memorial was opened for business. That is your design. Were you happy with how everything turned out and as you stand there right now with the completion of the site very near, are you happy with the way everything looks . Very, very happy. I remember being here 15 years ago and seeing how the site has transformed over that period of time and it feels like its new york again. Its taken a while but it feels like an organic part of the city. You mentioned its taken a while. Did you ever imagine it would take quite as long as it has . No. Rome wasnt built in a day. 15 years in the life of the city is a blip, but 15 years in our lives feels like a very long time. The design was selected for the memorial was selected in january of 2004 and i spent eight years working on this project. But it wasnt until a few years ago when finally the construction fences around the memorial came down that it felt complete to me. My office is nearby, im a couple blocks away from here and get to see thousands of people every day walk across this memorial people who work here, live here and visiting. And seeing that is incredibly gratifying. Seeing the site is part of the urban fabric of the city, day to day life of the city, its part of new york again. It means so much. Yeah. For those that have not been to the memorial, they should. Particularly the pool stood out to me at the base of where the towers used to stand. Can you go through some of the other details that were part of your original design . So, for those of you who can recall, what the wkt uorld trad center used to look like it was a 16 acre super block in the middle of the city. The master plan called for carving up that 16 acre into four discreet city blocks bringing greenwich street and fulcrum back through the site and taking half of the site eight acres and dedicating it to the memorial where the two pools are. Those pools mark where the towers once be stood. And so if you think about it, creating an eight acre open space in one of the most dense urban environments in the world, is remarkable. Se setting aside that place for the public for memory, for new york, was a remarkable decision and that preceded my involvement in the project. And then i sent in my proposal for the memorial that should be cited on those eight acres and i wanted to find a way to highlight absence, to highlight emptiness, highlight the sense of what was once here is no longer here, but we still feel its absence. And i initially sketched ideas for a memorial and the hudson river long before this competition imagining the river shore open forming these two square voids. When it came time to design a memorial at the site i took those ideas and tried to bring them here by creating these two empty spaces where the memorial, where the towers had once been. And you can see that water flowing into an abyss but that abyss remains empty. It never fills up. Despite the passage of time, despite the flow of the water, that sense of emptiness and void remains. You know, michael, you mentioned that the memorial now sits in what is becoming again an organic part of the the memorial became a popular destination as soon as it opened. Now that its near the center of the office and Retail Complex is there a risk or have you seen any evidence that the memorial doesnt get as much attention or is it treated and used initially as it was . Its treated differently. Part of the daytoday life in new york. One of the most moving moments i had was giving a presentation about a memorial to a group of people about to move into tower 1. They could be in tower one behind me. So tell them about the birth of this neighborhood and how meaningful it was to me to have people around the memorial working like the people that perished here today. Were not forgetting what happened. Were living with hah had happened here and thats so important and seeing Office Workers and neighborhood residents, theyre here for the once in a lifetime pilgrimage ask what gives it so much in my mind. We appreciate you taking the time to join us this morning the designer of that. Tune in tonight on cnbc. At 10 00 youll see jim cramers documentary ground zero rising. Freedom versus fear. As we head to break take a look at where we stand on the first trading day of september. The dow down 73 points. Financials and energies giving back the recent gains. Well be right back on squawk on the street. The lights go out. People get anxious and my office gets flooded with calls. So many things can go wrong. Its my worst nightmare. Every second that power is out, my citys at risk. Siemens digital grid manages and reroutes power, so service can be restored within seconds. Priority number one is keeping those lights on. It takes ingenuity to defeat the monsters that live in the dark. A sell off on wall street for what is beginning a typically volatile month of september. A half a percentage point decline here but losses accelerated after that weaker manufacturing report at the top of the hour. Weakness since january. The dollar down and the financial stocks. It seems as if to find a border well the trend is still intact and maybe something not so great. Sit an earnings mover and moving lower after earnings and i wasnt kidding earlier when i said it was them. Their fresh package products are proving to be tricky. They called out execution issues. And fresh, healthy, organic brands this is a huge beneficiary of the low yield and the stock and Consumer Staples. Safety trade. They did raise the dividend 12 . Brings the yield closer to 2. 5 but not enough today. No, its carat problem and weakness. Hes got a million of them. Not sure any of them are any good. Lets send it to john with a look at whats coming upped on squawk alley. We are watching sales force down this morning after earnings and revenue beat expectations. Also tim cook with more strong words over what the european regulators are trying to do. Well dig into that and uber ceo is speaking out. Well talk to a reporter. All that and more coming up on squawk alley. Whats going on here . Im val, the orange money retirement squirrel from voya. Were putting away acorns. You know, to show the importance of saving for the future. So youre sort of like a Spokes Person . More of a spokes metaphor. Get organized at voya. Com. Hey, its been crazy with school being back so were constantly going over our data limit. Oh, well, now all of our new plans come with no data overages. Wow, no more overages . So that means. Go on. Say it. Well finally be in control. And were back. Introducing new at t plans with no data overage charges. Good morning. It is 8 00 a. M. At sales force headquaters in San Francisco california. 11 00 a. M. Here on wall street and squawk alley is live