Just out he says that we know we need to take the time to get this right. And he expects that the time between now and the launch period will be an open process and he acknowledges that it will be subject to Regulatory Oversight and review he also says that he agrees with the concerns of fed chairman jay powell, that reviewing libra needs to be a patient and thorough process rather than a sprint to implementation david marcus also calls Economic Empowerment one of facebooks core values. Thats why theyre participating in the development of this currency he says and emphasizes that libra will be a payment tool and not an investment. He likens it to cash rather than to boyitcoin but he also lays out the danger of failing to act. He says that if the u. S. And facebook does not take the lead on this issue, we could soon see a Digital Currency controlled by others, whose values are dramatically different so there you see david marcus agreeing that the organization that will create this Digital Currency will be subject to regulatory review, acknowledging that there will be a long and involved process in putting this together and thats a testimony that we will hear from him tomorrow. We will see exactly how hard he gets pressed by lawmakers. We know theyve been very skeptical and will have a lot of questions for him. Back over to you ylan, weve been wondering what facebooks response would be to a week plus of criticism thank you, ylan mui joining us to talk about that is kara swisher good morning to you. Hi. Good morning some of these other headlines are interesting. Marcus, if america does not lead innovation in Digital Currency and payments, others with, quote, dramatically different values will. What do you think . Mmhmm. Thats the china argument, right . Thats the xi or me argument thats a big argument from Silicon Valley if we dont let them be bigger, if we dont let them to continue to be as big as possible, that were not going to be ahead in innovation and in my mind, innovation comes from competition so the question is, how much competition is our government going to allow how much competition is going to be created when we have all of these large companies. Its i agree with david in that regard, in that we have to have great investments in ai, in cryptocurrency, all kinds of stuff, but facebook isnt necessarily the answer to that all of these questions kara, i dont know about you, but i am so sick of this china bogeyman argument. I mean, President Trump used it with huawei. It turned out to be bs tech is using it you ought to let us do all of this stuff or else chinas going to do it when will we be able to focus on real policy, reasonable limitations and regulations and figure it out based on that instead of this fear stuff, right . Well, exactly peter thiel used it today against google without any proof about chinese infiltration i would like to have investigations of all the infiltration at Big Companies like facebook and google and anywhere else. Of course, we would. But at the same time, this argument that only these Big Companies can protect us is really just, i just its just so much crap, i dont know how else to say it and so they just they just i get the idea and i think david is a really terrific executive but the fact of the matter is, innovation and competition will make us strong in this country, in the kind of internet we want to have. Thats just thats my point of view. Kara, do you think if it was another Big Tech Company with lots of users that wasnt called facebook, that it would be getting as much scrutiny right now, libra, i mean what do you mean . Im sorry. What would it be if it wasnt called facebook . If it was another tech company that wasnt facebook that was looking to pioneer and launch this digital coin, do you think it would be getting as much scrutiny . No. No but facebook has got a record of stuff that is sloppy and problematic and troublesome. So they should have scrutiny you know, i think we might if we saw apple doing it, i dont know how i would feel about amazon doing it. I would like all of them to be doing it and i would like there to be a lot of startups doing it. So, again, i cannot stress how much competition is the most important and cleansing part of creating innovation. And big, giant companies wading into big, giant areas, which have all kinds of problems, should be scrutinized. Its the job of our governments to do that in governments around the world. And theres nothing wrong with them doing that. Well, and heres as people continue to dig into the testimony, kara, marcus says facebook likely to realize greater ad revenue after the libra launch, as users increasingly use them as a payment platform so is this a means to another end . Or are payments so large that it will supplant social thats the big debate right now like a lot of other companies, theyve had to find other things google has this amazing search business, but they moved into other businesses because there were worries about what would happen now amazon into search and search advertising, facebooks there. Its a typical thing to do, but just say its a business move, which is fine, which is fine to do that. But, again, pretending that scrutiny is not important is just a fallacious argument it just is there should be scrutiny, especially around finance. There should have been scrutiny of social media and we see where that went. There should be scrutiny around health care, around ai, around robotics and that doesnt mean heavy regulation that means proper government scrutiny and weve gotten to a point where were pretending that these companies should operate like nation states and they should not. Its just typical. I mean, jon knows, what he was saying earlier to that point, kara, lets turn to peter thiel and some of his comments today, making remarks at the National Conservatism conference over weekend, saying that the fbi and the cia should launch a probe into google, saying the companys work in china is, quote, seemingly treasonous. Do you have any background for us on this i do not. I do not know where hes making these allegations from and again, these are allegations without any proof, which is sort of, hes learned very well from the guy he invests in, which is trump, is to make allegations without any proof. I think, obviously, infiltration by russians or chinese or any malevolent government towards the United States should be taken seriously. But this is a guy whos on the board of facebook, which has plenty of its own similar problems and also is an investor in pall pallentier, which had links to Cambridge Analytica and on and on and on. And of course we want to study and look and investigate infiltration at the same time, its sort of pot calling kettle black its not a surprise, but its certainly amazing that someone would do this. Without proof, of course part of the problem i have with this antigoogle argument is a lot of people on that side also argue that china has compromised its own companies, huawei, alibaba, ten cent, et cetera and of course, chinas model is such that they can grab facial recognition data, not necessarily respect Civil Liberties. They should be a lot better at ai than u. S. Companies are right . So what do they really need google for googles whole argument for being in china is that there are great ai researchers in china and theyre making a talent argument i think its important in this that we figure out, what are we really talking about on the one hand, we talk about, chinas way better at ai than we are. But on the other hand, somehow, they need to steal googles ai secrets. Which is it . I think its just a lot of hand waving. Look over here by the way, did you notice on friday, theres this ftc fine of facebook over here its hand waving, as far as i can see. At the same time, corporate infiltration has happened since the beginning of time. The question is, how do you protect against it whats the real issues, and again, i dont mean to say china is not a problematic country in terms of how its developing the internet we dont want the surveillance economy internet that china has. And at the same time, to pull out these names as china, spies, infiltration, without any proof seems irresponsible to me. And thats the reason it was done, to cause headlines zm and this is exactly whats happening. Kara, we dont have the details or any kind of proof, but i do think it sort of speaks to a larger debate that does seem to be brewing, at least between the u. S. And china, or the u. S. And other countries in the world. Tom siebel touched on this on our show last week, this idea that whoever at least a country perspective, whoever leads in ai basically leads in terms of the future of global dominance. Well, it depends on what kind of internet you want there can be two kinds of internet and again, let me get back to this, the reason the u. S. Has dominated here is because we have competition and innovation at the same time this is a governmentsanctioned internet and thats whats going on in china. So the way we win is we have a very vibrant startup economy of companies, of all kinds of Companies Competing with each other. And its not that its not a concern. Its just this hand waving without any proof is just a distraction. And thats precisely the point that peter thiel is making hes not trying to make a bigger point about our country. Hes trying to say, look over there when theres all kinds of problems that companies hes involved with. Its just its pure trump, as far as i can tell. And its disturbing to do that and at the same time, we should be investigating any of these things, which again are not uncommon for countries to do that it went on its gone on for so long, this kind of thing. And all of these companies should be wary of that and i agree, there should be investigations i just dont agree as to the person saying it and his motivations for doing so all right well, we got this we got marcus responding. Well see if google responds to thiel later on well see well see. Kara, well see you soon. All right thanks and meanwhile, we are just over eight hours into amazons twoday prime event. Our Courtney Reagan has the latest on that from hq courtney hey, john so today, like you said, just the beginning of amazons fifth prime day, which has become this annual shopping event. And itsnot just amazon thats participating, but hundreds of other sites, too so while estimates will variy for the exact revenue that prime day actually generates for amazon, core Site Research estimates it will hit 5. 1 billion this year, thats about 1. 4 of amazons annual sales. While the event is in 18 countries, around 60 of the sales will be generated right here in the u. S. From an estimated 63 million prime members, because youve got to be a member to take part in the deal the event is a recognititention vehicle, so it reinforces the benefit of the program, but also a key recruitment event for new prime members. Last year, amazon added more prime members during the day than any other day in its history. Didnt tell us exactly how many, though a cowen and Company Survey suggested that 10 of nonprime households would consider signing up to access the deals thats a big number. But there are deals abound beyond amazon. Its now a shopping event across retail, retailmenot counts more than 250 retailers offering deals around prime day, 40 more than did so last year. Sales force says total ecommerce will see sales grow 51 this prime day compared to last year. Adobe, a bit more bullish, for the largest u. S. Retailers forecasting 49 sales growth on this prime day and if amazons site goes down again this year as it did last year, it just opens up more opportunity for competitors, though jim shabai, the vp of amazon prime says there wont be a problem this year. Weve worked really hard this year to make sure weve ironed out all of those technical glitches now 48 hours, over a million deals, deals being released every five minutes were confident all of our members will have a great experience at least so far, no glitches on amazon or other websites have been reported, but were watching it. Weve got many, many hours left to go still. More kb moregan . Yes, we do. Im sure its going to keep the Package Delivery companies pretty busy over the next couple of days too, courtney. We should also mention that amazon is broadcasting live on their website. Its an almost qvctype fashion, highlighting some of the deals that users can get today you can see that video right there. As we head to break, the dow and s p and nasdaq all again setting record highs earlier, all moving around the fat line, trading around the flat line. Coming off their fifth positive week in six. Tech also coming off a record close. Here are the names powering the nasdaq to those levels this morning. Were back in a moment welcome back to squawk alley. Nasdaq hitting another record high earlier in todays session. But with big tech names such as ibm, netflix, and microsoft due out with Quarterly Results later this week is an earnings recession coming that was the thesis of our next guest in his prior appearance with us. Wedgwood partners chief Investment Officer david rolfe joins us here at post nine good morning to you. Good morning. Are we destined for an earnings recession this season i think weve been in a little bit of a soft one for the past couple of quarters. If you look where estimatixpect or estimates were even last year, theyve slowly come down and even with tech, all through the second quarter, estimates have been declining. So its a its an interesting set up to where the stocks have done so well, but maybe expectations are muted i think its an easy setup, at least for tech this quarter. Well see if things get worse, if things roll over. I think maybe the one area that is still a harbinger of potential risk is the volatility of credit spreads. Plenty of Economic Indicators have been weak, but i think thats what really got the fed powells attention late last year and its been pretty benign so far this year so soft landing thus far for corporate earnings and but i think the story continues to be the fed, with stocks at everyday alltime highs so do you think the fed cuts at the end of the month . And if so, by how much and i guess the read through there, what does that ultimately mean for equities . Yeah, i dont think its one and done its probably not 50 basis points well, thats not good not for expectations. Yeah. And i think even through this earnings season, i think earnings are probably going to take somewhat of a backseat. What i mean by that is, if Earnings Results are exceptionally good or forecast or guidance is exceptionally good, stocks are going to move on the other hand, if its exceptionally poor, like alphabet last quarter, the stock is going to react and its going to be a bad outcome. But i still think the fed is the Gale Force Wind in the market. And i mean, techs up from the Christmas Eve lows from last year i think nasdaq is up 33, 34 and so a lot of open field running for big cab tech, if the fed doesnt disappoint you think theres any liability on netflix, because of the price hike because of the content thats being removed . Or have they flooded the market with so much new stuff that were going to see subs hang in . I think theyre going to struggle i mean, when you look at the metrics, there has to be somewhat of a combination of how much are they spending to keep existing subs . And that figure is going up. And we are just in the early innings of this of these streaming wars you know, a few Companies Like disney and others have a couple of dollars to throw at this war. I would be a little bit worried on that front. So are you feeling good about, lets just say, Enterprise Cloud tech right now . Based on where we are . Well, we had a slowdown in some capex spending late last year i think in terms of specifically the cloud, all ears are going to be on. If theres been a resumption of spending from the likes of the big players. And that has obviously a related effect to nvidia adobe and oracle seem fine, the early belaerearly bellwethee season so just based on that and at least some moderation of those negative trends we saw last quarter, are you feeling im having trouble parsing whether youre feeling, yeah, theres a soft earnings recession. Is that okay is that not okay well, okay, lets go all the way back to the beginning of this earnings recession. The fed was tightening a bit even if you look at the qe side of things with qt and tightening, the fed tightened a lot. And obviously, in the industrial sector, weve had a significant slowdown but again, once the fed blinked, it was off to the races and tech has been such the dominant leader over the past number of years. But we are starting to get a point on some of these individual stories that you mentioned that i mean, adobe is up what, 50, 60 yeartodate at a certain point, youre going to have to justify that multiple with some really darned good earnings forecast. And so, again, tech isnt a monoli monolith, but it sure has acted like it given how much some of these big tech caps have ripped. So key question for you, whether its tech or another area of the broader market, is there anything you would be investing or selling right now weve actually reduced our positions in some of the more industrial cyclical names and for the first time in many, many years, we notably reduced our waiting in berkshire hathaway, because of cyclical reasons and as well as the lack of buybacks and putting that cash to work. David rolfe, thanks for joining us today thank you and when we return, from the president to powell. The criticism for crypto continues to ramp out. Well ask ron paul if he remains bullish on bitcoin and the rest. Thats next. Stay with us that Broadcom Symantec deal, well, it is off. Our david faber broke that story earlier and is back at post nine with more. David . It happens sometimes, jon, unexpected as it was, because as recently as late last week, there was an expectation that this deal was going to get done, broadcom would buy symantec. The thought was, perhaps adeal would be announced as soon as tomorrow not going to be the case the two sides, as we reported, no longer talking about a transaction that would h