Good thursday morning. Welcome to squawk alley. Carl quintanilla with jon fortt and Kayla Tausche at post 9 of the new york stock exchange. Joining us, Business Insider ceo Henry Blodgett. And in minneapolis, bill george, former medtronics ceo, former exxonmobil board member, of course a cnbc contributor. Good morning, guys. Our first story is amazon today, announcing it will create more than 100,000 new fulltime, fullbenefit jobs across the u. S. Over the next year and a half. Our deidra bosa is at one market with more on that. Hey, deirdre. Good morning, guys. Amazon was already on track to become one of the largest employers in the country and this announcement confirms that trajectory. The company emphasized that the opportunities will be for people across the country and with all types of experience, education and skill levels. Ceo jeff bezos says these jobs are not just in our seattle headquarters or in Silicon Valley. Theyre in our Customer Service network, Fulfillment Centers and other communities throughout the country. That is an important point, because of course, trump has made jobs his focus and the Tech Industry can be known for making a lot of money with a smaller workforce than say the manufacturing sector. It may also be an opportune announcement. Many, if not all of these jobs, were already in the works. But the big headline number put out in this way could help further ease past tensions between the president elect and bezos. Heres what trump had to say during the campaign. I have respect for jeff bezos, but he bought the Washington Post to have political influence. And ive got to tell you, we have a different country than we used to have. We have a different he owns amazon. He wants political influence so that amazon will benefit from it. Thats not right. And believe me, if i become president , oh, do they have problems. Theyre going to have such problems. Now, guys, amazons announcement is also notable because it talks about direct jobs. That is in contrast to recent pledges by other tech giants, alibaba and softbank, to create jobs in america without such a clear road map. Back over to you. Deirdre bosa out west. Thanks. David faber, among others, noted this morning the plan has been previously disclosed by amazon, but the press release could be to gain the attention of the president elect. The trump team was quick to take notice. Incoming White House PressSecretary Sean Spicer made reference to it on todays transition media call. Take a listen to that. The announcement was made after the president elect met with heads of several other Tech Companies and urged them to keep their jobs and production inside the United States. This, as you know, jeff bezos and others who were part of that, and the president elect was pleased to have played a role in that decision by amazon. So, lets turn to Henry Blodgett first on this. Henry, is this where we are now, companies trying to get its unverifiable whether these are truly new, whether they would have done these anyway, but certainly its expedient. Its expedient, but its also great. And lets celebrate it. And lets also note that amazon takes a lot of flack for not maximizing profit. One of the reasons, one of the things it enables them to do is invest like this. They invest every dollar they take in on future growth, future jobs in the United States. This is great for them, its great for the United States, its great for their customers. We should encourage all companies to do this. Dont dust off the party hats quite yet, though, i would say, because we dont know what jobs amazon is going to be destroying in the process of doing this. Amazon is kind of walmartesque in a sense that they disrupt whats already there. It could be grocery jobs. They could be in affect killing 200,000 grocery jobs over the next year and a half by rolling out fresh in a bigger way, even as theyre creating 100,000 in something else, so if you are going to object to that, we basically have to push pause on the economy and say no innovation. Im not saying i object to it. Apple has destroyed millions of jobs across the pc and cell phone industry. Im not saying i object to it or that its necessarily objectionable to anybody, but dont see the headline and just assume thats 100,000 new jobs without other implications. The economy is bigger than that. Its an ecosystem. When we were discussing with regards to ibm, for many in the usa op ed, she said she would create 20,000 new jobs, but the companys laid off double that over the last few years. Bill, i wonder how easy it is to put out a press release with the job number youre going to create, but how is this enforced . How are they held accountable . Were taught in journalism school, show, dont tell. Its easy to tell, more difficult to show. Journalism needs a lot more closedloop feedback these days and im not sure youll see that, but i learned 15 years ago, never bet against jeff bezos. These are Fulfillment Centers all around the country. He is working his distribution system. Its a quasi bricks and mortar without having stores. Yes, youre right, hes going to put macys out of business. Macys just closed its downtown store in minneapolis about a block from here. This is going to happen. But this, as henry says, this is the nature of innovation, the disruption. This is a good thing for america, and we should applaud it. It reduces the cost to consumers, which we somehow forgotten about. But i think we have to look at the deeper issue here. Every ceo is trying to either, a, curry favor with trump by telling them whats in their current plans to create jobs, or b, stay out of his way, as the farm industry found out yesterday. And im not sure this is entirely a good thing. Youre seeing a lot more people like the autos rushing in to say, oh, fiats going to add a million jobs or whatever sure. There are a billion Capital Expenditures this is already in their plan, 200,000 jobs. This is peanuts. So i wouldnt take too much credence in this, in everyone trying to curry favor with the president elect. Theyre just afraid of his powers. Its true, relative to the labor force, its a small amount. We do have a halt on fiat, as youve been talking, bill. Lets get to phil lebeau with more news on Fiat Chrysler. Phil . Reporter and carl, as expected, the Environmental Protection agency has formally filed charges against Fiat Chrysler, or is announcing that it will be accusing Fiat Chrysler of installing software on about 100,000 vehicles that allows those vehicles to allow excess diesel emissions, those vehicles being 2014 to 2015 jeep grand cherokees and dodge ram 1500 trucks. Those are the models that have the 3. 0liter diesel engines. Those are the ones sold in the United States. The epa momentarily will be outlining why it believes that these vehicles are in violation of the diesel emissions standards here in the United States. By the way, we have talked with sources familiar with Fiat Chryslers response to this. It is likely to be that the company will, a, deny the allegations, and b, say that theyre going to fight vigorously to prove that these vehicles are in compliance with diesel emissions standards. And most notably, the Company Plans to work with the epa team of the Incoming Trump administration to prove that these vehicles are in compliance with pollution standards. That is whats going on with Fiat Chrysler and the epa. Guys, back to you. Our phil lebeau in atlanta today doing double duty on Delta Air Lines and autos. Phil, thank. We turn to peter thiel, the venture capitalist and Trump Transition Team member, speaking out in a rare one on one with the New York Times maureen dowd, commenting on the president elect and the highprofile tech summit at trump tower i think early on, everybody was worried that they would be the only person to show up. At the end, everybody was worried they would be the only person not to show up. I think the bigger Tech Companies all wanted to get a little bit off the ledge that they had gotten on. As for other Public Companies like apple, he says the early age of innovation is over, we know what a smartphone looks like and does. Its not the fault of tim cook, but its not an area where there will be any more innovation. Henry, we know thiel likes to light it up, hes contrarian. Is he right . I will say there will be some more innovation, but i think this is a product that has come in, its a product cycle and is now maturing as a product. It is the most profitable and successful product in the history of the world, and its slowing down, so thats obviously going to have an impact on apple. I do think there will be anticipation about the launch of the next iphone, which is supposed to be significantly different than the current version. Its not going to be radical. Its not going to revolutionize anything, but i think there will be excitement about that. So i think apples in decent shape for a little while. In the sense that pc innovation died five or ten years ago, i guess its a reasonable thing to say, but i wonder what you think about what he said about the tech ceo meeting with trump, the idea they were afraid of going, then they were afraid of not going. Now we have the Trump Transition Team kind of taking credit for this amazon announcement. What is the state of affairs between tech and trump, just sort of cautiously working things out . Well, president elect trump, as he did throughout the election cycle, as he did in the press conference yesterday, has a habit of throwing a big fist from the sky that youre not expecting, and suddenly, the entire pharma industrys reeling because he says theyre getting away with murder in the press conference. Now theyre scrambling to figure out whats going on, putting out press releases saying, hey, we want to manage prices and so forth. During the campaign he said, you know, apple, im going to force you to bring all iphone manufacturing back here. Amazon, youre going to have all these problems. Okay, he got elected. A lot of people spoke out against him. Now i think this is just a meeting where in one way, they are kissing the ring, coming in, saying be reasonable. And i noticed also in that meeting, president elect trumps tone was more reasonable and inclusive, as it should be, because these are great companies. We should be celebrating them. Right. But thiels saying one of the reasons they went is because they needed to step back from the ledge that they had gotten themselves on during the election. And bill, companies we dont normally see being that political. And im wondering if you think that tech and Silicon Valley learned a lesson with getting themselves on the wrong side of this election or if you think it was worth it to them. Well, first of all, peter thiels getting a lot more publicity than he deserves. He hasnt built anything in a long time. And lets look at the builders, the larry pages at google and the Mark Zuckerbergs and the tim cooks. They are building something. And i can tell you, theres a lot of innovation, new technology and new iphones coming out. So, just because you have the first product doesnt mean the Technology Ends and its not a dramatic breakthrough product like we thought the ipad was. So i think youve got to look at the real builders here. They are creating tremendous amount of benefit to the u. S. Economy, world dominance. My fear is that were playing the game with trump, and its becoming a crony capitalism game. Were not playing to basic economics. Just having jobs come back to the United States, theres not necessarily a benefit. Consumers gain tremendous benefits from what apples doing, producing around the world. We dont want everyone rushing back to the United States to bring their production. The innovation is here. They create huge numbers of jobs. So give credit where credit is due. On the farm industry, i have a different point of view. And i know that industry very well. I think im on trumps side here. I think theyve got to look at their pricing. Its egregious. Now, when you have a company like merck or eli lilly that are coming out with drugs that are changing the course of treating disease, its justified charging their price, but when you have Companies Like epipen or mylan, today cvs came up with a generic epipen at onesixth the price. I think there will have to be some constrain on drug prices. Allergen says were only increasing 10 . Thats four or five times the rate of inflation. So, i think there will have to be constraint and i hope trump does it with the pharmaceutical industry because its causing health care too much, and we know were going to have to justify the cost of everything we do in health care. We cant just keep going up, up and away. So i think we need to parse this a little bit, look at the difference between a breakthrough drug and an older drug that theyre just raising the prices on and reform those policies. Exactly right about pricing and health care. We do have to address that. Theres no question. I think in defense of everybody who works in the pharma industry, one would hope we would do it in a way just more methodically, deliberately over time, rather than throwing a fist from the sky. I dont think thats fair to a lot of hardworking people. Im with you, henry. You guys are way too reasonable for this show. Thanks, guys. Good to see you. Thank you very much, krarlg. As were talking, the dows down 166. The worst session since the fall. Lets get to bob pisani with more on that. Bob . Several problems weve got. A little bit of earnings jitter and a little bit of bonds jitter. Bonds are rallying. Take a look at 10year yield. Remember how banks have been, Goldman Sachs a big influence there. 10year yields, 2. 3 . Thats the low yst since late november weve had, steadily down for the last month. This is putting a lot of pressure on the banks. It has been. Remember, the bank rallies stopped in the middle of december, so kbe is what you want to look at, the big bank etf. It has slid a little bit here. Heres your big banks. These are the banks that will be reporting tomorrow. Everybody looking at jpmorgans head, jamie dimon, for guidance on the state of the economy, see whats going on with them overall. Theyve been sliding for the last several days here. The important thing on banks is the earnings revisions have been going up for them overall for 2017. Thats good news, but the stock prices moved up a lot faster. So, heres whats happened. On 2017, this is what we care about, earnings revisions. Dont expect jpmorgan to say anything. Theyre not going to give dainius. Jamie dimon notoriously dislikes giving advanced guidance. Jp, bank of america way up, but the stock prices are up and thats were getting jitteriness about delivering on these high guidance. Ingersollrand, textron, dover all to the down side right now. No clear direction right now for 2017. The markets a coiled spring. Thats the way im describing it now. Guys, back to you. Bob, thank you very much for that. When we come back this morning, former new york city mayor Rudy Giuliani, his new role in the trump white house, his focus cybersecurity. Then, it wasnt just pharma taking a hit during the News Conference yesterday. Defense was also on edge. Later on, more from thiels extensive interview with the the New York Times, including comments he made about elon musk, Mark Zuckerberg and more, when squawk alley comes back. Wont replace the full value of your totaled new car. The guy says you picked the wrong insurance plan. No, i picked the wrong insurance company. With Liberty Mutual new car replacement™, you wont have to worry about replacing your car because youll get the full value back including depreciation. And if you have more than one Liberty Mutual policy, you qualify for a multipolicy discount, saving you money on your car and home coverage. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. Were opening more Xfinity Stores closer to you. Visit us today and learn how to get the most out of all your services, like xfinity x1. Well put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. Theres more in store than you imagine. Visit an xfinity store today and see for yourself. Xfinity, the future of awesome. The major averages having their worst day of 2017 so far. All 11 s p sectors are lower. The dow having its worst day since october. Meanwhile, president elect trump targeting lockheed martins f35 program again, sending the stock falling during yesterdays News Conference. Joining us now is richard saffron of the Buckingham Research group, director of equity research, to talk about this. And richard, you know, im wondering how much effect you think that the president elects targeting will have, because there is an expectation that defense spending will be expanding, but then you have this unwanted attention. Whats the net effect . The net effect is primarily in the short term. Youre absolutely right, defense spending, in my view, is going up and going up meaningfully. I thi