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Thats an appropriate song for friday the 13th. Good morning. Happy friday. Welcome to Worldwide Exchange on cnbc, im sara eisen. Im glad you reacted to that rather than my quip earlier. My name is wilfred frost. That was the earnings. Yes. You didnt pick up on it, or you are just being mean to me like you have been the last half hour . Long week. Its friday. It looks like sara is upbeat in the last 15 seconds. Just. Lets check in on the global markets. As for u. S. Equity futures, stocks closed lower, but way off the lows of the session. Especially as europe closed yesterday morning, things started to improve in the u. S. Session. Dow futures positive today. Up 11. S p futures up 1 1 2, nasdaq futures up 4, this comes after the nasdaqs first and only down day for 2017. Breaking that tremendous winning streak of five record closes in a row. The dow at one time us with having its worst day of the year, but recovered. Yesterday yields were lower, the reversal of the trump trade, weaker dollar, lower yields, weaker stocks. They are a bit lower to in thei have some reports out today. Disappointing china export data, december exports declining 6. 1 in dollar terms year over year, imports rose 3 . Both figures falling short of consensus, particularly that export data. Lets look at asian trade. It has meant shanghai market was in the red, japan and hong kong doing all right today. Up about 0. 8 and 0. 5 . The early action in europe is mostly positive reversing yesterdays declines. Ftse 100, record highs again. Everything else declining yesterday. The dax down a percent. Ftse 100 up 0. 03 . But in the green, 13 straight sessions. Its amazing. Were seeing that strength translate through the rest of the continent. Italy up 1. 1 . Broader markets, those oil prices for you, gained about 1. 5 yesterday. They are soft today by a half percent. For the week as a whole, were looking at a 2 decline for wti, still nicely above 50 a barrel. The dollar, lets look at that down 0. 36 for the third negative session in four, week to date, about a percent of declines. As you can see, looking at declines once again quite pronounced or relatively pronounced against the pound and euro. The pound in positive territory. Wonderful to see. The dollar a bit soft. Bitcoin, that is around the 700 level, 796, close to 800. Gold prices to round things off, had a decent week. Up about 2. 3 for the week as a whole. Today 1,196. Yesterday we finished off the lows. The declines of about a quarter or a third of a percent, even at the close still hide some bigger moves, particularly in the banks. Down over 1 for the broad index. Big names down between 1 and 2 . Clear thats partly trump trade profit taking, particularly in light of what you said earlier, the tenyear bond yield pull back to 2. 3 . And the dollar pull back. A lot of those trump related trades profiting. Also focus coming into earnings, which kick off today. Just simply expectations are lili higher than they had been for qs 1 to 3. In the short term, expectation for this quarters earnings are tougher to come by. We have Pnc Financial today, also blackrock today. A lot of people are saying not so much about the quarterly numbers, really about the commentary and the guidance that we get from the bank executives. Are they as optimistic as their shoulders have been. The Kbw Bank Index outperforming the Broader Market by four times. Massive moves. But quiet over the last month. That move came in the first four weeks following the election. A lot of people looking for a catalyst. Thats why they say, store instance, stocks were weaker yesterday. Trump didnt give them anything new to buy on. Infrastructure, tax cuts, pro growth policies. To theres been a bit of a pause. On tone, they could surprise to the upside. We have not heard from them as a collective group since middecember, early december. The tone then at the peak of the share prices was very, very positive. I would say surprisingly positive. Given that since then bank stocks have plateaued at best and some have declined, if they reiterate that same tone from a month ago, despite getting closer to trumps inauguration, yesterdays declines could be quickly eroded. New Fund Flow Data this morning to tell you about. Lipper reports stock funds attracted 2. 4 billion in inflows during the latest week. Notefully all of that money flowed into etfs. Investors pumped 4 billion into Investment Grade Corporate Bond fi funds. Jack boguard on yesterday winning the war as the money flows into etfs and out of actively managed funds. The biggest question this year, as volatility starts to pick up, is there going to be a return of the active fund manager . Its early. So far those flows show not so much. Lets turn to todays agenda. December retail sales out at 8 30 a. M. Eastern. Also at 8 30, december Producer Price index. 10 00 a. M. January Consumer Price sentiment. Janet yellen says she is upbeat about the short outlook. Yellen yesterday said the labor market is looking pretty strong. The central bank chief is worried about longer term issues like widening income inequality and weaker growth in labor productivity. Yellen did not offer specifics on the feds Monetary Policy plans. To washington news, the Obama Administration is ending a two decade old policy that allowed cuban refugees to ender the United States without visas. The wet foot dry foot policy began in 1995 in response to a flood of cubans leaving the island nation by boat. Cubans who managed to get to u. S. Oil were allowed to stay and become u. S. Residents. The change comes as part of the efforts to normalize relations between the u. S. And cuba. To the trump transition, one week to go, one week from today until the president elect is inaugurated. No cabinet confirmation hearings today. They will resume next tuesday following mondays Martin Luther king jr. Holiday weekend. On capitol hill today, the house will vote on a measure moving towards dismantling obamacare. The senate voted yesterday to approve that legislation which will set the repeal motion into process. We wait to hear what the replacement will be. To todays corporate agenda financials are in focus. Well get quarterly reports from bank of america, Jpmorgan Chase and wells fargo. As i mentioned Pnc Financial and blackrock as well. We discussed in terms of numbers and sentiment Going Forward what we might hear. The other thing on the deregulation front, it now looks like the fiduciary rule from the department of labor, due to come in force in april is being kicked down. The senate trying to delay that by a couple of years. Interesting on the calls if we get comments on that, that could be the first big step in terms of deregulation coming early. Its something not enforce yet, but a significant step. So thats something on the calls to be listening to. Will do. We will listen for that. Morgan stanley reportedly laid off a number of Senior Investment bankers last week and cut bonuses by roughly 15 . The move comes because of a decline in revenue and dealmaking and Capital Raising which weighed on wall street. This was interesting yesterday, these cuts, particularly to the bonus pool, bigger than what has reportedly been happening at other banks. I see this as a positive. One question in terms of this general more positive outlook for banks is revenues will be higher, will that drag costs up . Either way its good, but how good will it be . I think investors are hoping that the cost cutting measures weve seen over the last couple of years and cost expense target for a few years out are kept. The level of operational leverage the discipline. Exactly. Provided theyre positive about the outlook for m a next year, i think these cuts will be welcomed by investors. It shows a lot of cost discipline. One thing on the cost side, this was an interesting point, the ceo of kbw was on yesterday. He was saying he likes the big bulge bracket banks now because he expects them to take market share from european competitors. In this country and abroad. I wonder how that affects the cost equation and whether you heard that. I think thats been a theme over the last couple of years or year particularly, both with brexit and the big winner is the new York Financial centers and banks here, rather than uk based european banks moving overseas. The new york bank also do better out of that. And deutsche bank, one of the top three Global Investment banks having problems. That benefits the guys that can play. On the flip side f we see deregulation that is likely to benefit Smaller Banks more than bigger banks. Bigger banks can take the cost of regulation more easily. Theyve been complaining and the sifi status they want lowered, so they dont have to participate in the stress tests. In other news, citadel reportedly near a settlement. They have been accused of misleading customers about the routing of their stock orders. Union credit share hoerltsd approved a 13 billion euro cash call under the new ceo. Most of the car will be used to cover loan losses. Shares rising today, but the stock still down sharply on the week. Up 2 today. When we come back, the stocks to watch and on a programming note, next week join us at the World Economic forum in davos, switzerland. Well bring you a frontrow seat right here on Worldwide Exchange. We have a great lineup of guests. Its going to be freezing. Were getting our long underwear ready. Please join us. Well talk to the likes of society generals chairman, the ceo of rusal. It all begins tuesday at 5 00 a. M. Anslnt35shshedacro oth spoke ab m whsticae . Atsm w t good morning. Some stocks to watch today. Anadarko petroleum agreeing to sell its south texas oil and gas assets to Sanchez Energy and blackstone for 2. 3 billions. Pandora laying off 7 of its u. S. Work force by the end of the Fourth Quarter. The company ending 2016 with more than 350,000 new subscribers, and strong advertising performance. It does expect to exceed Fourth Quarter guidance. Lowes expected to cut less than 1 of its work force. The Home Improvement company changing its store staffing model, reshuffling roles and responsibilities of staff to boost face time with customers. Kkr agreeing to buy hitachis power tools unit for 1. 3 billion. The deal is kkrs second japanese buyout. No move in kkr stock price. Wgl holdings, the parent of washington gas, is in talks to combine with canadas alta gas. The transaction could value wgl at 5 billion to 6 billion. Boeing reaching an agreement with indias spice jet for more than 200 planes. The dell including 100 firm 737 max 8 jets. The airline saying the order could be worth 22 billion at list prices. Spice jet doing better off the news than boeing. Shares of renault are down sharply in europe. Reports say french prosecutors opened a probe into whether the automaker cheated on diesel emissions tests. The news was big on fiat yesterday, today renault. Fiat chrysler is rebounding in italy a day after u. S. Regulators accused the automaker for using software to cheat on emissions tests. The ceo, Sergio Marchionne called the allegations hogwash. Also saying today that the epa accusations will not have an impact on fiat chryslers business plantar get targets. Phil lebeau drawing a clear distinction between that case and this one, perhaps one reason why fiat is rebounding. He was very clear. He said our conscious is clear, Sergio Marchionne. And they are bring out these new accusations, the epa, the next administration will have to deal with them. Its all confusing. Marchionne says bring on the Trump Administration. Well talk to the Trump Administration. Scott pruitt could lead a different government office. Investors more relaxed today about this than about the volkswagen scandal 24 hours after that was announced. Still to come, the top washington stories, including the Justice Departments Inspector General saying he will look at Public Disclosures by fbi director james comey. Good morning. Welcome back to Worldwide Exchange. Lets get you up to speed on the markets. A first look at europe which is rebounding today. Germany yesterday was down 1 . The ftse 100 was up fractionally, eking out its 13th straight session of gains. Looks like well hit another alltime close today. Futures stateside looking good. Yesterday down a quarter to a third of a percent. Also those relatively small declines hide some of the bigger sector declines, like banks down over 1 . A focus on that sector today as the likes of jpmorgan starts reporting. The dollar is soft. Yesterday dollar softness was correlated with equity market softness. Today doesnt appear to be the case. Woe have the dollar softness, 0. 4 declines against the euro. Futures still in positive territory. To politics, one week to go until trump takes office. Tracie potts has the latest on the transition and all the other big stories out of washington. Good morning. Reporter good morning. Including a new investigation, the Inspector General for the Justice Department says he wants to look into the fbis directors actions regarding the Hillary Clinton email investigation before the election. This is something that democrats and republicans on capitol hill had been pushing for. The Justice Department Inspector General says he will look at Public Disclosures by fbi director james comey, including last summers News Conference announcing results of their investigation into Hillary Clintons email server, and his letter to congress, just before the election announcing a probe of new emails that turned out to be nothing. In a statement, comey said he welcomes thoughtful evaluation and transparency. When a Law Enforcement agency breaches protocol in such an unusual and unprecedented way, i think for the confidence of that agency everybody should get to the bottom of what happened. Reporter there are no confirmation hearings today. The latest dominated by questions about russia. I have very modest expectations about areas of cooperation with mr. Putin. Reporter the president elects relationship with the Intelligence Community is still a concern. The hope is he has people around him who understand it is the crown jewel of everything we do. My obligation as director is to tell the policymaker the facts as best the Intelligence Agency has developed them. Reporter washington is getting ready for the inauguration once week from today. And the team working with mr. Trump says that it will be traditional. But toned down a bit in terms of celebration. Theyre expecting, authorities expecting 800,000, 9 0,000 people. Justin trudeau is weighing in on the future of u. S. And canadian relations. The canadian Prime Minister holding a town hall in ontario last night as part of a crosscountry tour. He talked about having a constructive working relationship with trump but said differences between u. S. And canadian priorities. Canada is the number one export destination for 35 different american states. And this is something that we have emphasized already a number of times to the incoming administration. Trudeau said there are issues that the u. S. And canada can have disagreements on. Theres been a bit of a bromance between trudeau and obama. Not as strong as a different bromance which we will talk about later. Obama and joe biden. Lets move on to sports. And the Golden State Warriors who have the best record in the nba this season, they took on the Detroit Pistons at home last night. Steph curry scored 24 points, but also got all his teammates involved. The warriors hit 15 threepoint shots in the game and blew out detroit with a score of 127107. Did you watch mr. Curry last night . I didnt, shockingly. I already knew they would win. When will he come in on set . Ill try to arrange that for you. Still to come, the top stories including financials as a number of big banks plan to post Quarterly Results. First a look at todays yesterdays biggest s p 500 gainers. Top of the list was tiffany co. Dee nmt. Good morning. Financials in focus. Three banks report Quarterly Results in the next few hours. Fiat shares bounce back after u. S. Regulators accuse the automaker of cheating on emissions tests. Now concerns over renault. And a bromantic surprise. President obama has joe biden in tears, giving everyone a chance to celebrate joebama. Worldwide exchange continues right now. Good morning. Welcome back to Worldwide Exchange on cnbc. Im sara eisen. Im wilfred frost. Lets check in on Market Action this morning after a day of declines yesterday. We finished off the lows. We finished down a quarter to a third of a percent. Though those relatively modest closes did hide some bigger delind declines on sector basis. Kw banks was down 1. 3 . Moves of 2 , 3 in smaller names. The big cap stocks were around 1. 5 declines. This morning we are called higher, about a tenth of a percent, 4 points for the dow. Lets look at european trade. Thats positive today after a pretty pronounced day of negative trade. The dax down 1 . The french cac over a half percent. The ftse 100 was positive, 0. 03 , just eking out a gain, which made it 13 Straight Days of gains for the ftse 100. It is up again today, both the yo euro and pound are stronger. Asian trade, china soft following trade data which disappointed, in particular we saw disappointing exporting which fell 6. 1 year on year. The expectation was for a 4 decline. Shanghai in the red. Japan and hong kong finishing the week on a positive note. Oil has been on a nice winning streak. Its giving some back this morning, down 1 . Wti, 5247, brent, 55. 44. Interesting to see crude rally in the face of stock weakness yesterday, especially Energy Stocks at the bottom with financials. That tight correlation between oil and the Broader Market and oil and the Energy Stocks is coming apart a bit. Well see how that continues. As for the tenyear treasury note yields, yields are lower. Thats been the trend as the treasury selloff paused and has gone the other way. Go back in the 230s again. We hit a low of 2. 30 yesterday. Just a reminder of that weak, back in middecember, 2. 64. Quite a pronounced move weve had, and steady declines. Today we are back up. Bank stocks are tied to the yield curve. So is the dollar. Yields in the dollar backing off from recent highs as well. 1. 0650 for the euro. Its that dollar yen number weve been watching. Flattish, looking for some direction here. The pound is stronger also versus the dollar. 1. 2219. Especially amazing to see the ftse 100s climb in the face of a day where the pound is strong. Saw that yesterday as well. Exactly. Good to see it. The pound was off yesterday and weve seen volatility in the pound pick up significantly over the past week. Theresa may it was announced yesterday will make a speech next tuesday to outline her plans on brexit. That will be something the markets will be focusing on. Quickly, gold has strengthened in the face of dollar weakness and marching back higher. Has a long way to recover. Down a quarter percent. Turning to todays agenda, the busiest day of the week for economic data. December retail sales are out at 8 30 a. M. Eastern. Sales forecast to rise 0. 7 . At 8 30, december Producer Price index. At 10 00 a. M. , Consumer Sentiment and business inventories. Philadelphia fed president Patrick Harker will report today. We get Quarterly Results from bank of america at 6 45 a. M. 8 00 a. M. , jpmorgan and wells fargo. Also we have asset manager blackrock and the key focus on this is the management commentary. If it is as positive as it was last time they were altogether and talking middecember, i think markets will refocus on the positives of the trump trade for the banks. Since then bank stocks have tread water. We have all focused on what theyve done since the election which has been positive. But if theyre positive on the outlook especially jamie dimon. He usually sets the tone of the earnings season, not just because he has a good overview of the economy and banking sector, but now a lot of bankers are linked up with the Trump Administration and the cabinet picks. Wall streets dream team inside that trump transition. I think jamie dimon has the ability to do that, the jp morgan call is with the cfo, mario lake. First up is bank of america, theyll be important. Next week, of course, some investment banks with Morgan Stanley and goldman sachs. Many names well be talking to in davos next week. Fiat chrysler has been accused of using an auto emissions device to cheat on emissions testing. The ceo, Sergio Marchionne called the allegations hogwash. Here he was in an exclusive interview on power lunch yesterday. Should have been a review that was carried out. The last action by the epa which effectively confirmed the 2025 standards without consultation was an unwarranted act. So i hope with the new administration well get a better audience to try and resolve these issues and determine what is doable by 2025. Marchionne says the epas accusations will not have impact on fiat chryslers business plantar gets. Will not. Will not. Very good. Moving on, though sticking with a similar theme, shares of renault are down sharply today. French prosecutors have opened a probe on whether the automaker cheated on emissions testing. Renault down 3. 3 . At stock on the move, pandora surging after the Company Making some big announcements. Landon dowdy joins us with the details on this one. Good morning. Good morning. Shares of pandora rising as much as 7 in afterhours trading after the Company Announced it would cut jobs and beat its earnings forecast. The internet Music Company saying it would lay off 7 of its work force by the first fiscal quarter of this year commitment to cut costs and Fourth Quarter revenue will be above the 362 to 372 million range. Pandora now has 4. 3 million paid subscribers thanks in part to pandora plus, the adfree tier generated an additional 375,000 new subscribers by the end of december. This marked the companys first offering using direct music licensing from the major record companies. Pandora premium, set to launch in the first quarter, will give subscribers unlimited access to tens of millions of tracks, helping it compete with spotify and apple music. Back over to you. Thank you very much for that. Shares of takata rising 16 today in japan after reuters reported the company reached a 1 billion settlement with the Justice Department over faulty air bags. They have been linked to several deaths and injuries. The settlement could be announced today. Takata will plead guilty to criminal misconduct and i clued a 25 million fine, 125 million in victim compensation, and 850 million to pay automakers who suffered losses as a result of the global air bag recall. Shares jumping nicely off that news. Shares of nintendo falling nearly 6 in japan today. Ending at a twomonth low. The company disappointing investors with the new console game. The switch goes on sale in the u. S. March 3 for 299. 99, the same as its predecessor, the wiiu. The switch can be used as a home console or handheld device. Analysts say the price is not justified because theres not enough games available, just eight when the switch hits stores. Lyft lost more money in 2016 as revenue for the ridesharing startup surged. Reports say the Company Posted an operating loss of 600 million versus a 360 million loss in 2015. Revenue jumped to 700 million last year. Lyft said monthly losses would not reach more than 50 million. Uber is on track to lose 3 billion dollars in 2016. The fact these guys are still losing money, its kind of extraordinary. But revenue growing so sharply. Theyre still in expansion phase. Thats why theyre not going public. One reason, maybe. Its not like theyre still a Small Company growing, huge scale, and they still cant make money. Time for top trending stories now. An emotional farewell for Vice President joe biden. President Obama Holding a surprise tribute for his vp at the white house yesterday. Giving him the medal of freedom, which that distinction is the highest civilian honor you can get. President obama taking a second to honor the internets love for joebama. This also gives the internet one last chance to talk about our bromance. This makes biden only the fourth person in u. S. History to receive the award, alongside Pope John Paul ii, Ronald Reagan and colin powell. I knew it was a big award, i had not realized it was that elite. And it hit social media because joe biden was very emotional. He had to turn around, compose himself. Snapchat unveiling a major redesign for its app. The new look adds a search bar, new navigation and a global live story featuring snaps from all over the world. The company is expected to rl out the redesign in the next few days on ios and android. Probably not going to draw us in. Instagram stories. They tried to compete with snapchat. Theyre winning. We were already doing instagram. We. Were. Its just an extra social media app to get into. Thats right. In davos i think we should do all of it be totally social there. We should probably focus on the show each day. Jeff bezos reportedly buying the largest house in washington, d. C. For 23 million in cash. Home is a its not a home, its a two building spread that used to be the textile museum. The property was purchased back in october. The buyers identity remained a secret until recently. The story was first reported by the washington post, which is owned by jeff bezos, and also in the same neighborhood as where ivanka and jared bought their house. Ibili ibility. And where michelle and barak have their home. Dont know why were on first name basis. The size of this property, 28,000 square foot. Thats a lot of room. For someone. Because theyre based where is he based . Seattle. Amazon. Also a big house in beverly hills. Thats lightly insulting. Your little city home you pop into a few nights a year. He wanted to save on hotel bills was the word. Thats fine then. Todays must reads still to come. Next week join us at the World Economic forum in davos, switzerland. An outstanding guest line up. All of the conversations in and around putin and trumps relatio relation, deripaska is a close confidante of many powerful people. Welcome back to Worldwide Exchange. Time for our mustread stories catching our attention in the papers. My pick is in the New York Times. Some might be surprised to see this in the New York Times from the Editorial Board. James mattis toughness and restraint at the pentagon. Looks like the Editorial Board was impressed with what they heard from mattis. They say it was encouraging he had no qualms stating views at odds with positions mr. Trump campaigned on, including americas relationship with russia and the future of the iran nuclear deal. Its to mr. Trumps credit that he would appoint a strongminded defense secretary who is likely to challenge assumptions held in the white house. A strong vote of confidence there from an unlikely source, i would say, the New York Times. My pick giving a vote of confidence not to just that hearing but others taking place. The trump cabinets good opening week. Here are some of the comments made. On general mattis, a figure of almost universal respect. His confirmation is expected. On rex tillerson, she writes he came across as distinguished, calm and informed. And on senator jeff sessions, she writes he was cuffed about various things, but emerged relatively unscathed. Not just on general mattis, but on all of them, saying they have come through relatively well. Because we also had obamas farewell speech, she talks about that as well where shes unsurprisingly critical overall of his presidency. It has been a dramafree week for the confirmation hearings. For so much noise the democrats made about how they were going to challenge these nominations, either they didnt do their homework or the candidates performed well. Thats been dramafree, but other press conferences that werent. That stole the show. We are approaching the top of the hour, the team is getting ready for squawk box. Becky quick has a look at whats coming up. Im looking at today like dday. Its friday the 13th. Also the day when we will hear from five finals. Pnc, blackrock, bank of america, jpmorgan and wells fargo reporting. The financials are up about 17 . All this enthusiasm for what is expected to be happening, today is the day we find out if the guidance will keep up with wall street expectations. This is the day weve been waiting for. Markets stalled out a bit. Shooting and bumping up against 20,000, but not quite hitting the magic number. Today is the day we might sink or swim when we hear from this. Well hear the guidance from all five of these companies. Well have a special guest joining us. Larry fink will be with us for a half hour today. Chairman and ceo of blackrock. Hell talk to us about what hes seeing in the markets. If you remember, one year ago on this earnings day a year ago larry joined us and told us he expected more blood in the streets when it comes to stocks. Well see what his prognostication is for this time around. We also have chuck todd from meet the press joining us to talk about everything thats been happening in washington. You guys were talking about the hearings going on, the press conferences. Chuck will give us his updates on these issues. One guest, sara, youll be eager to hear from, rohan oza. He used to be the chief marketing officer at cocacola, then went on moved on, now he h these hot new brands, drinks that dont use the sugar. He will talk to us about what hes seeing. Hes known as the brandfather of some of these drinks. The brandfather. What you just described, thats the sweet spot of where consumers are now. Flavored waters. No calories, a bit of sweetness, natural sweetness. No calories. This is the growth in the indust industry. That sounds good. Squawk box in 11 minutes. Still to come on Worldwide Exchange, barclays chief u. S. Xh economist Michael Gapen will join itus. The trump rally took a pause in yesterdays session. Futures are pointing to a higher open. Dow futures up 15. Well get Bank Earnings and december retail sales. Joining us with what to discuss from the next administration and wall street today, Michael Gapen. Good morning. Good morning. Thought it was interesting we had so many fed president s, voting members out yesterday on the tape and wall street barely moved. It feels like we have transitioned to all about politics and fiscal policy. What are you watching next . Thats right. The fed used to be viewed as the only game in town, now fiscal policy is taking the lead, the fed is saying well wait and respond to whats coming. In terms of whats coming next, you mentioned retail sales. That should be a fairly decent number today. We had strong auto sales in december. Core sales might be softer. But the consumer looks in very good shape. For all the data points, thats the one i would focus on. The way that weve seen the dollar come back a bit this week, we saw the tenyear fall to as low as 2. 30 yesterday. It comes somewhat off the back of that trump press conference, people felt well see more of candidate trump than the slightly more pragmatic president elect trump weve seen in prior weeks. Is that something you buy into . Do you feel hopes for a practical Economic Growth agenda have softened over the last couple of weeks . Thats the reason yields have come back . To a degree thats right. I would couch it differently. Immediately after the election, my conversations with clients seems to reveal that people were looking at only the good parts of the platform they wanted to see and were ignoring more controversial parts. The press conference perhaps was a remind their theres a lot of anti trade rhetoric. We put peter navarro, a fierce china critic at the head. So maybe a more balanced assessment that the fiscal stimulus could be coming, in our view you will get protectionist trade policies as well. I would put that major border tax, which trump mentioned during the conference. A big border tax. You looked at this. Right. How do you estimate what that would do for corporate profits and for Economic Activity . Theres a lot of moving parts with this. On one hand, if the dollar were to move a lot and you could get a significant amount of offset. So the border tax acts like a tariff. If the dollar appreciates significantly, it would mitigate some of that response. We think its difficult for the dollar to move in a way to make every company indifferent between pre and post border tax world. We think that side of the package could be contractionary. You would get an inflation inpulse, a weight on consumer spending, business spending. Maybe the upper end of our range could be a minus 1 on growth. Thats why you need a fiscal stimulus plan to offset that. We think it could have some contractionary impulses to grow four quarters. We had a lot of warnings from analysts and economists like you about this border tax. What president elect trump might say is that it will encourage companies to manufacture in this country, encourage Foreign Companies to do the same, bring jobs back, increase wages, it will grow our american industry. Do you not see that as an effect . I dont see it having a tremendous boost to job growth. What were describing is the initial the short term response. What you described is the potential medium term den fit. We would have to trade those off. In the shortterm, its somewhat contractionary, those positive benefits you mentioned over time, its a possibility. I think its more of an unknown and depends on a lot of other factors. It clearly does reorient u. S. Activity away from trade, towards the domestic economy, and thats been a platform of his from the beginning. Its a policy that would help him address Many Campaign promises. We get to hear from many banks today. How important for you is the commentary we hear from the insights that those managers get . I think its important. We are seeing movement on several fronts. The regulatory front is one of those. Banks have been some of the worst performing stocks for the past decade. A little bit of relief there would be helpful. Banks are like the lubricant to the economy. You dont drive far if you dont have much oil in your engine. For the positive spin, getting some good earnings reports would be helpful. Michael, thank you very much. Michael gapen of barclays. Just about a minute left. Heres what to watch next week. Theres one thing. Worldwide exchange at the World Economic forum in davos, switzerland. Well be there with a great lineup of guests. Its going to be a great week. We look forward to that and to squawk box this morning, which is next. I am the future. I provide for my family. I will use my education to help my community. I will inspire our next generation of leaders. I am a college student, but i am only 1 . Only 1 of College Students are american indian. Donate now, and help our numbers grow. Good morning. Earnings alert. Blackrock and bank of america set to report this hour, well get numbers from jpmorgan and wells fargo later in the show. And the final countdown just one week to go until donald trump takes office. The latest from the transition, and nintendo shares are plummeting after the company unveiled its new console. Well tell you what disappointed investors. It is friday the 13th. Squawk box begins right now. Live from new york where business never sleeps, this is squawk box. Good morning. Welcome to squawk box on cnbc, live from the Nasdaq Market site in times square, im becky quick, with Andrew Ross Sorkin and Steve Liesman who is in for joe today. You can see right now, some green arrows. Dow futures look up about 21 points above fair value, this after the markets were down yesterday off the lows of the session. S p 500 futures up by 2 1 2 points, the nasdaq futures up by 6 1 2 points. Overnight in asia, market theres ended mix with the japan nikkei up 0. 8 . In china, markets were mixed. The hang seng was up by a half percentage point

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