Index that is normally, joe, thought of as a leading indicator for a bold market. What time do you get up in the morning . That was a great segue. That just flowed right into that. What time did you get up . 3 30. Did you watch this show yesterday . Yeah. If we analyze that, what kind of return it is is . Thats incredible. So you dont know. You need a ti calculator. Sorry. I wasnt taking notes. Well, you would remember. Youre a mathematical genius, right . It is 1250 . You do it on the ti calculator. You get three and a half times your money. Pretty good. I thought that was interesting. You didnt like the facts . We probably wont. I dont think so. But it would be nice. We do need, like you should probably have that program. What is 5 impounded over 12 months . It is a lot more than 60. Yeah. It is the eighth wonder of the world. We need a ti 83 calculator. I think mine got sold at a garage sale for like 10. That is not a good return to our investment. Youre at the early part of your career. The impounding that can be done with saving money with you and mr. Right. Is that his name . Anyway, its very powerful. If you can do an ira, deferred comp. Or even in a 401 k where your employer matches you. Right, right. Trying to save some money. Lloyd said that. People mocked him. No. There is a social thing. All right. Wow. Lets get a check on the markets overseas. I thought japan was pretty interesting this morning. Up 1 , 204. What worked. Suddenly theres 1,000 carrier jobs staying and japan weakened. We have different plans this week. On the pound. Ftse did well at 122, 123 post brexit. Ftse is one of the better performing markets since brexit. I would say the answer to jump in here. The burden of proof is on the globalist. All the doomsday scenarios, if trump were elected, frankly the markets in both places have performed quite well. Did you watch at least in the morning . Did you see mnuchin . I was traveling. Mack, the one that runs the cameras. Did we not have a long discussion on strong dollar or weak dollar . What would a treasury secretary want . Should want a strong dollar. You hear all the ceos whining. But doesnt it attract capital . Isnt this the best place to invest true supply side people do not see a concept between a strong dollar and strong market at all. Is it global person . It absolutely is. If you have superior products. It is a question whether there is a virtuous circle. Do you get a dent in gdp. How does that change the psychology of the market . The real risk in my opinion is that u. S. Almost becomes or the dollar becomes too strong and you suck up all the oxygen from the rest of the world. So particularly for emerging markets, it is more of a problem than it is for the u. S. Longer term. The u. S. Is not a particularly big import export economy. We may have some gdp to the work with where that wont be. Im to not saying we wont have any. Well see. Theres tax cuts, less regulation. Were also watching crude prices. Historic agreement by major producers. Opec and russia agreeing to cut oil 1. 2 billion. Almost 53. Of course everyone, jason, is trying to figure out where they can poke holes in the opec agreement. Do you see any bad news were ignoring . Exempt for the eventual cheating that will inevitably happen. I think, you know, Stable Oil Prices are best for everybody involved, i would imagine. I am not an expert in that area. Im more comfortable with 50 a barrel oil than i would be at the beginning of this year, we had 26, 27. There were real questions whether we were going into an industrial recession. Stable is better than other alternatives. We will talk a little bit more about some of the contours of that deal. Here are some of the other big stories were watching today. President elect trump will kick off a thank you tour, visiting cincinnati, ohio and indianapolis, indiana. Meantime, Goldman Sachs coo is considering leaving the firm. He met with the president elect this week and politico reports he could be a contender to head the office of management and budget. Cohn has been seen as a likely successor to plankf he ein. He has been a deputy for a decade. He is considering whether it is time to move on. Fit bit is in advanced talks to acquire pebble. They launched a smart watch years before even the apple watch. The company has benefited from funding on kickstart thor. Thats where it got its start. The combination would help fitbit ebs panned on on product offerings. They are reportedly hoping to sell for 200 million. That would be a big deal to swallow if you are fitbit. Stock is up in premarket trading. Weekly jobless claims are out at 8 30 eastern time, followed by i is sm Manufacturing Index and construction spending. Loretta mester and rob kaplan reporting today. Dollar general, workday and smith wesson report today. In ever National Newspaper includes a story on president elect trumps pick for treasury secretary, Steven Mnuchin. And it matters what the treasury secretary does the at the behest of the president. Yesterday he said americans should expect the largest tax change since reagan. Our most important priority is sustained Economic Growth i think we can get to sustained 3 to 4 gdp. That is absolutely critical for the country. This will be the largest tax change since reagan. Weve talked about this during the campaign. Wilbur and i have worked very closely together on the campaign. Well cut Corporate Taxes, which will bring huge amounts on of jobs back to the United States. He he also talked about doddfrank. Also talked about lending and a lot of other issues. The number one problem with doddfrank is its way too complicated, and it cuts back lend. We want to strip back parts of doddfrank that prevent banks from lending. That will be the regulatory side. Lets get back to the markets on the first trading day of the month. Sarah hunt at alpine funds. And paul hickey of Bespoke Investment group. And jason with research partners. We had already talked a little bit and sarah and paul about the interview with mnuchin yesterday. Did either one of you have strong feelings about what you saw . The pick and what he discussed is shows where all the bomb throwing in his rhetoric on the campaign trail, he is a practice ma activity in nature. And picks from the practicing ma activity. Trumps tax plan mnuchin was one of the key proponents of the 33 tax rate. Other people wanted it lower on trumps team. His rationalization was we are not going to get lower than that. So we will go with a number we can get past. They are going in with realistic expectations. As it was pointed out yesterday, theres campaign talk. Yeah. But then theres legislation that needs to be written. Who knows what that finally looks like. Maybe something between paul ryan, mnuchin, donald trump. Will it be productive do you think . I think certainly a lot of talk about Corporate Tax reform for a couple of years. If we can get something done on that it will help the perception and help some of the issues that have gone on versus more competitive versus less competitive for the u. S. There is a will to do it. You might be enough to get some people to the table. But do you have the enough to get it passed and how much horse trading is going on. How closely do you think the tax reform that well get matches the reform that the Trump Campaign was discusses before the election . Because the house plan calls for Corporate Tax rate of 20 . President elect trumps plan calls for 15 . Obviously that would be a huge cost of revenue at the federal level. If i could handicap that i could do a lot of other things pretty well. I think there will be maneuvering around that. The question, is it going to be as much about the headline numbers and what goes on underneath. Even for personal taxes, if youre taking away some things, are you putting in lower rates but taking away deductions. There is optimism something is going to get done. So it is just optimism that we will move forward and reign in some of the regulation, reform some of the tax code. I would say my own opinion, not to recap jack lew. The treasury secretary, as long as he shows up basically to block deals. Having a treasury secretary that actually seems to be pro business is that like a technocrat. Its good. Its a change. I was actually watching the show before us, which is even earlier. We had the typical guy on. Typical strategist saying three to four, no way gdp growth. No way you can do it. Probably the same group that said if trump is elected, the markets will collapse. But then it was the same thing. He said, you know, productivity. You cant get the growth. Population growth isnt enough for three to four. You can do the stimulus maybe for a couple quarters. Absolutely no credence to supply side stuff, like cutting taxes or deregulation. All we can do is that is the kind of thinking that got us 1. 5 , isnt it . The one Thing Companies have been doing because of low rates and high regulations, as long as Financial Engineering as opposed to cap spending. The reasonist has been weak, most are issuing bonds to the buyback stock. They are using the money to buy other companys bonds. Right. If you do something affirmative to build growth, productivity wont be close to zero. It will be like one or two. Im not as defeatist i think as some of the other people on 1 to 2 growth. What about 3 to 4 . I think it is very possible. For more than two quarters . It is is certainly possible. Youre not going to get there shooting for 1 to 2 growth. As so many people seem to think that is the maximum potential. If youre going to spend eight years with our basic goal as redistribution, youre going to accept 1 to 2 . That looks okay under certain circumstances. Do you think it is possible . I think it is. I dont think you can get it out of the gate. Reregulation will help. Taking some of the shackles off some of the things we have had. And changing some of the health care might help too. That has been a big cost to the a lot of firms. And that made people somewhat reluctant to say, hey, i want to hire people full time. People, generally speaking, are optimistic. I think it takes a little while. You have to the see what they can get done. Okay. Sarah, thank you. Paul. Thanks. Jason, youll be with us for the entire time . If youll have me. Ill be here as long as you want me to. He did get up this early. At least, jason, if youre here, youll see the show. Where were you yesterday . I was in chicago and milwaukee the last two days. For business . For business, yeah. No cnbc in milwaukee. Coming up on cnbc, the trump transition is at a historic moment in time with ripple effects in every is sector of the market. If youre not sure how to play it, stick around. Well run through potential changes to the tax code, and regulation that could break or make your portfolios. Squawk box will be right back. Welcome back to stock box. Heres what president elect trumps pick for treasury is secretary said on squawk box yesterday about Economic Growth and his expectations for Interest Rates. I think that Interest Rates are going to stay relatively low for the next couple of years. And were in a period of time of low Interest Rates. And i think well stay there. Interest rates have come up a little bit, which i think makes sense. Well be looking at the treasury, all different types of opportunities. We will look at potentially extending the maturity of the debt. We will have higher Interest Rates. That is something this country is going to have to deal with. All different opportunities. But we went from everyone you talked to were talking about the savings, supply problem. And we were fully comfortable thinking we would have another three, four years of sustained. You know, we go up a little with the fed. We were all convinced this new normal will keep us at low interest. It was an aberration. We will go back to this mean of 2 or 3 . All of a sudden people were thinking were immediately going back to 8 or 9 . When he said it, it was like, wow, maybe the dollar doesnt go so high it cuts off exports. Maybe we do still stay we go up a little today, 2. 4. It doesnt mean we go to 5 , 6 . We dont blowout the deficit. Hes not even president yet. Do you worry we blowout the deficit and worry about a bond market collapse . No. Usually the rule of thumb is it is where nominal gdp is. No matter we have been low. We are about half where you would normally be. So exceptionally low, artificially taopg because you have had all of this input from Central Banks around the world, getting back to normal Interest Rates is good. Its particularly good for bank. The steep epping of the yield curve is good for interest margins. You need banks to participate in monetary policy. In many ways the policy we had under the Obama Administration is sterilized by tight regulatory policy. So the irony was only the wealthiest people really benefited. The average person that had a savings account did not benefit. So this is a good in my opinion, its a good policy mix. What happens when the fed begins to unwind its own Balance Sheet at the time . Thats an interesting question. I dont think theyre going to do that. I think they will keep the Balance Sheet pretty high for a long period of time. Thats the plan. You grow into the Balance Sheet, which i think would take 2023 or something. You would get back to where it would have been normally. But i dont think i dont see the fed tightening aggressively. I also say, to be fair, despite some of the rhetoric of president elect trump on the campaign trail, i dont see him replacing first of all, he cant really do it. Right. A lot of people talk about tight money until theyre president. And they had we dont have to be dramatic, tight money people. Central bank input. Growing into the Balance Sheet. Cut someone off at the knees. Joining us now with more on the trump trade, Chuck Gabriel is managing director the a Capital Alpha partners. Lets bring you into the conversation. We were talk building what happens to a trump presidency, what happens to spending, Interest Rates. Which are you more focused on right now . Im very much focused on the legislative side of it all. Like jason was suggesting, is cognitive dissidents and disbelief about what is doable, if you will, and the process well have to go through. The fed will be dancing like ginger roplgers with fred astaire with the physical side of it all. We have be gown see warnings from fed chair yellen not to get too ahead of itself or for, too, aggressive. You say the street may be enjoying false confidence right now. Why dont you think its real confidence and whats to come after january 20th . Again, there are a number of pieces to all of this. Clearly, you know, there are certainly reasons optimism after seven, eight years of what weve been through. An administration has been coming in. Dethe regulation is very important for medium to longerterm bases. Beginning to make assumptions about that immediately. That is certainly very rational. They are beginning to make sump you shuns about lower or corporate insurance rates. The next leg, for instance, for financials, youre going to have to see a number of things fall in place. Im not suggesting theyre necessarily ahead of themselves. But particularly in terms of what they are expecting in washington i watched cnbc yesterday. The tphoegsz of a big trillion dollar giveaway is ahead of itself. And a former cbo director saying, hey, listen, you guys are way too focused on the trump proposal thrown in at the very end for the American Voter in a package that the House Republicans put together for an intellectual exercise. Were starting fresh. There will be pressure to create at least some bipartisan support for a bill. I think the markets are expecting 2 trillion doctors to 4 trillion. I put the over under at a trillion and i go with under. I think theyre hoping for a 20 Interest Rate. I think it would be herculean if they could get it down to 25 . And there would be pain involved for some Companies Just based on the tradeoffs. Well Interest Rates are going to stay low . Well, i think they will stay lower longer. I think mr. Mnuchin is right. I dont think youre right about a lot of this stuff. Joe, ill make you a one dollar bet. Why dont you think im right . Im more optimistic that mnuchin trump is not supposed to be president either. Were you predicting that . I had 45 odds at the end what was going to happen to the markets if he was president , in your view . I felt strongly that the worries were grossly overdone and you would have a reversal just like with brexit. I think it will do over a trillion probably. And i think we can get under 25 out of the Corporate Tax rate. We have a Republican Congress. It is just not that easy, joe. Right now you have 5149. Hopefully it will be 5248. Maybe with reconciliation. Again, let me just say, what a lot of people are missing is the dollar number is associated with net tax relief, 2 to 4 trillion you can do an awful lot that will have a market impact. But there is a big difference between tax reform and tax relief. Mr. Mnuchin himself talked to you about tax reform yesterday. He has to get confirmed. How much opposition do you think mnuchin will face . Oh, it will be loud and noisy. But there are a number of factors will will give him the right to have his treasure seu secretary. He will win. Goldman sachs will be blashemed in the process. The Company Announced results of one of its cancer drugs. The ceo is next. What i love most about tempurpedic mattresses. Is that they contour to your body. It keeps us comfortable and asleep at night. Get your tempurpedic. The most highly recommended bed in america for as low as 25 per month and 90 night free trial. Welcome back to squawk box on cnbc. U. S. Equity futures at this hour ar