Just before the fourth of july. Our road map begins with jpmorgan this morning. The banks set to pay pay recordbreaking 13 billion Justice Department fine to settle lawsuits at the height of the financial crisis. The markets pointing to a mixed open after the s p closes to an alltime record high as they wave some better than expected earnings against some budget uncertainty. The stock falling in the premarket as global sales fall in sim september. Starbucks in hot water after being accused of charging china markets higher than others. Jpmorgan close to reaching a tentative settlement. Kate kelly caught up with jamie dimon as he arrived at work this morning. Good morning. Reporter this 13 billion settlement na jp organ more beg hammering out with justice. What happens in light of the settlement . I asked mr. Dimon about this just momenting as as he came into work. Here is what he said. Were going to try to resolve everything we can and then were going to move on and serve our clients. I am so dam proud of this company. Thats what i wake up thinking every day. Reporter i hear you. These other things, i know we have to fix. Reporter carl, you can hear a lot of pride in the company. Jpmorgan is reaching some Peak Performance levels. The legal they added to a tune of 9 billion. This most recent quarter swung it to a lost. Some still yet to be resolved. We do think we will have some closure on the civil aspects of these housing issues within the coming days or a week or so from what im told. It is the biggest civil find in history. It is half of last years profits. I think it is a win for both sides. I think the American People cannot feel that they got ripped off by jpmorgan. Shareholders might feel that way. This was a jihad against jpmorgan. It was on every month. The Justice Department was going to sue them everywhere. This was going to go on for many years. The legal bills were going to mount. If you get this behind them, you have a bank that trades at a 17 discount to its peers. I think it will get to that 5 . I cannot believe they only have to pay 13 billion given the fact there were a lot of people thinking it was going to be 20 or 25. The reserve is 23. The criminal thing, it is paid for somewhat under the bus. Unfortunately, thats the way it works in america. You never know if there is going to be more litigation to follow. I think the market will take this, as you point out, as nonrecurring. You move on. That being said, having followed the mortgage crisis and written a book about it, jpmorgan were the least. Bear stearns an washington mortgage were the worst, both of which they bought. Whether it was sydney or goldman, there are plenty of bad actors so to speak. I do wonder whether we are going to be revisiting that. Eric holder has said as much. Well see. Is this a blueprint for getting further fines and penaltying out of the rest of the crew. They would have spent 40 billion. It is difficult to define where the money has gone it or what it is a result of. To some degree, it seems wrong that jpmorgan has to bay for what happened at bear. At the same time, this is america. The Justice Department feels like they need some scalps. Those guys have all gone. Talk about going, nobody has gone to jail. Send a guy to jail, a lot of this wouldnt happen. The Justice Department has been, i think, shaking down. Thats an appropriate word for what was happening. What happens next time if there is a federal crisis. They are encouraging a large group, such as jpmorgan. The proof is in this. Will the Justice Department next week come out with a new thing about dime mon. I dont know. If you are a banker, you say, the government is my enemy. I am never going to do what the government wants again. Maybe the government says, they will never be in trouble i think jail time would have alleviated a lot. Not jpmorgan. Personally finding some real culprits. This is Share Holders. Nobodys house was taken away. Nobody really suffered. We never really heard about this. There was a ceo of Washington Mutual. Where is he . He probably has some island somewhere. There are a lot of islands for sale. We know elson bought one. I really feel like those guys did great. Dimon recognized the futility. They were going to sue him, every single city. The Justice Department plays for free. Michael core leone says, dont ever go against anyone that plays for free and just cares about the cause. Buffets talking about the number of licenses you need to operate. The traffic cop who is going to follow you for 500 miles. People talking about whether or not dimon hangs on to the chairman role even though we already went through that exer sides this year. Is that connected to your 5 premium you think it is going to get back to . I think there are whole groups of people that do nothing but talk about and deal with the Justice Department. If you could have them actually do banking, it would be extraordinary. We dont talk enough about this. He picked up the phone and called holder. Every lawyer in that room would say, if you dare do that, if you dare do that, that is the end. I think dimon said, you are going to negotiate my banking to the ground. I am going to make a deal. It is going to be more than you guys are willing to pay. I know you think we could litigate and get away with less. Our Share Holders need to move on. They have ended up paying a lot of money. My Charitable Trust owns this. This is the feds and the Justice Department. Lets not forget the putback location where they reached a for fortuitous settlement. Talk about countrywide and merrill. Im sure some people at homer saying, you know, all i ever hear about is that we almost ran out of monday last wednesday. Some of this money must matter. Is it all just in the ether . When you get 4 billion to go there, 11 billion goes somewhere. Does it really go anywhere . Does it go for 15 minutes worth of interest . Where does it go . It goes to the treasury. Does treasury ever have a plan. Does jack lew say, this is going to go towards jack lew could come out and say, we had a couple more days than we realized or maybe jamie dimon waits because maybe he was a tea party member. Honestly, these numbers are so high. I think the people at home will have to be saying, when does it matter . Does 11 billion not even matter . Given the sort of pays of federal spending right now, you could argue, maybe not. You can ted cruz would want less . I dont know. Is he pro banking . He is pro texas. And texas is pro him judging from some rallies. They dont like the texans. They can like the cowboys. Mcdonalds is falling. The dow says it earned 1. 1. 52 the quarter. Revenues were in line for the quarter as well. Take a look at comps. 9. The estimate was. 1. October is trending flat. They are guiding some pretty weak margin figures, jim, for q4. Carl, they had some great innovations. You were out there visiting them. We know the Wings Initiative was supposed to be great. Stock, practically nothing happened. They seemed to have a lot of innovation. It is not making them money. Europe, one of the brighter spots. They are up against it is not a pepsico thing about these guys. It is a plethora of options. It is a pot belly, a deli, a burger king. Noodles. Afce, popeyes is doing better, chipotle is doing great. Wendys has made a major comeback. Is it at the expense of mcdonalds . Does mcdonalds have an issue which is, i dont want to go to mcdonalds, because i dont regard it as healthy. Even though they have done a lot of healthy initiatives. You are referring to the mel in linial issues. Can you operate a mcdonalds in a whole foods world . We used to sneak to mcdonalds. Now, people would proudly sneak to chipotle. When was the last time you waited in line at mcdonalds . It is a quick line. Thats the point. The point is to have quick service. Maybe it is because they have no customers. I like my mcdonalds. I do. I love the new egg mcmuffin with the egg whites. I feel like im the only guy. I have met some parents that proudly say they have never taken their kids to mcdonalds. Mcdonalds is regarded as the enemy of healthy eating. Chipotle is regarded as the friend. The food with integrity. You go into that. You better be careful eating at the other guy. We actually care about what goes into our product. They do see expenses down 3 or so. Food costs coming in a little bit. Not enough to offset some of the weaknesses. Can it offset that . It is not a growth stock. Growth is what it is. Solar city is up huge. I am switching metaphors for a moment. They missed my eye roll. Ill do it again. You want growth . Netflix reports yes, they do. This is a company like solar city where you dont really care about what they earn. You care about subscriber growth, about buzz, about new subscribers. If you have growth, ala solar city, if you have growth netflix, there is no price people wont pay. You are a 95 billion marketing cab company with 17 p. E. , to your point. Thats mcdonalds. If i want that, i will go buy parker. I will go by General Electric. Add it to the focus list. G. E. I went line by line over the weekend while you were having fun with your kids. Yes, i was. Dont rub it in. You could have said nothing. You have great order growth, Margin Expansion. I like that. You have a Company Going from not so hot to good. Mcdonalds, a company that is good, consistent. I think this mellinell issue is not going to away z. China is crying foul. Plus, lee, timber and a four in one split s eric weiiseman. Well talk about what the jobs number may say tomorrow. A lot more squawk on the street when we return. 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His mad dash is coming up this week alone, you mentioned netflix and texan, boeing, cat, dupont, travelers, you name it. A lot of these companies, we are seeing the industrials do well because of china. Turn around, because of europe. Also, some of these have not quit. Caterpillar has been going up. United rental zone. Caterpillar has failed to execute. Boeing has executed so incredibly well. I have honeywell tonight. They did not do well in defense. Boeing does have a defense business. It is not going to be as clearcut this week. What about starbucks . We got this story this morning overcharging chinese. It feels like the chinese, they have it in for these american companies. They claim a coffee chain, they charge as much as 50 more for some of their products. They said they have labor issues. One of the things we know is that when the chinese have turned on a company. Starbucks is a great chinese company. You have to very quickly get this behind you. Very quickly. They have to dress and get behind. They didnt do anything wrong like glaxosmithkline did. Yum has been disappointing. You cannot be in the yum glaxo category. There was an article about how mercedes did something the government liked. That kept ford and chrysler. The government must be appeased quickly, quickly. So what do you do, lower prices quickly . Maybe a coupon . I dont know. Howard schultz is a Great American ceo. He will address this. You cannot let this fester. Suddenly, you have stories about yourself in every paper, magazine, online. They have to put this behind them so now, tough. You are actually going to talk to Howard Schultz later in the week, i think, on wednesday. Look, this china came out of nowhere. Remember, every time there has been a bump in the china road, it tends not to be just smith. No. It is even worse than the department of justice when they want you in china. Thats a communist. You are equating communism and justice. You are still thinking the communist power. There are still some people that wonder about the rule of law when it comes to contracts. Look whether it be fannie mae and freddie mac or the gm bankruptcy or perhaps wa moo as it relates. Did they did not know it was the most prolabor company . Do they read what he says and see how he is so good with the associates . Does that not matter . If you felt the prices could come down, you would. There is no way that i think that Howard Schultz is gouging the chinese people. It is not the style of the company. It is just not. They are not a gouger. You have to pay more. There is an affinity. This is a company that treats its workers well. The brand is actually adored in china. It is not starbucks. It is sheen bucka. How do you say latte . I have no idea we look forward to wednesday and you sitting down. This is amazing. This company is the most Servicepro Company we have in this country. Well get jims mad dash after a short break. 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At t is selling its towers to crown. Whats interesting about this . Att is trading up. Crown trading down. I think it should be the opposite. There is a consolidation of the tower business. Att is sure that maybe they can take the money and get a down payment on vodafone. This is an industry that has consolidated its american towers. Anything it consolidates is another 7 1 2 shares of the mandatory convertible. You want to be in that. Being raised to pay for the castles. You want to be in the Equity Offering is what im thinking i think it is a good Equity Offering. I like this group. American tower had some short sellers spreading some things, saying that last deal wasnt from brazil. He came on mad money and i thought the stock was up a quick ten from when he was on. I like this group very much. This is a Real Estate Investment trust group. They just coin money, david. They do. Particularly as Services Continue to prolever rate for all sorts of mobile devices. Lets move on to a Research Call this morning. This is General Mills and kellogg. Kellogg lowered to underperform, General Mills to neutral at bank of america and merrill lynch. If the economy were really slowing because of all the things in washington, you would be upgrading these, not down grading these. They see no catalyst. This soft goods group has done quite poorly as if there really is an Industrial Movement that is doing much better. These companies, their biggest ingredient is often oil. Yet, they are not going up. They are going down. Even the oil is under 100. I think this has to do with the giant feeling that the United States is not doing as badly as you would think from washington. The rest of the world, kellogg, kellogg is a Big Worldwide company. People do not want these recessionoriented stocks, david. They believe in a worldwide resurgence in the economy. Lets move on. The opening bill, just a few minutes away. Squawk on the street right back. Will we set another record on the s p [ bell ringing, applause ] five tech stocks with more than a 10 . Change in aftermarket trading. All the tech stocks with a market cap. Of at least 50 billion. Are up on the day. 12 lowvolume stocks. Breaking into 52week highs. Six upcoming earnings plays. That recently gapped up. [ male announcer ] now the world is your Trading Floor. Get realtime market scanning wherever you are with the mobile trader app. From td ameritrade. Squawk on the street live from the Financial Capital of the world on a monday morning. The opening bell is about to ring in about 60 seconds. There is a lot to get to today. We are going to be a wash in earnings all week long. Jobs number tomorrow. In addition, an ipad refresh that cantor at least thinks will bring some good things. Have you noticed apple creeps up. We talk about apple all the time. Im looking at apple and saying to myself, it is just too inexpensive and too many new products and i dont know about you guys with the new eye of the operating system, i discover something new