Welcome to squawk on the street. We wake up another tweeter bomb. A big week with a fed decision. The fed near 20k. Europe is mixed. 10year 2 1 2. Oil up on the nonopec oil production. The road map with the negotiation of the president elect and an american company. Donald trump calling out the cost of the f35. Defense stocks are dropping in the premarket. Timing, another Company Trump has in the cites, boeing, a deal for 80 jets. The buyer iran. And the markets making new records. Oil prizes, as well ahead of the fed meeting which, of course, is wednesday. David with breaking news. We do. On a potential deal that will not happen. And that is involving viacom and cbs. Right now, the National Amusements, shareholder of both companies, led by Sherri Redstone and wanted to them to engage in talks designed to see whether they could come to a combination has withdrawal that proposal of viacom and cbs engage in the discussions. Reversing course in a sense and backing the new ceo at viacom and his plan to bring the company back to prominence and through the difficult period. And saying that she wants viacom to remain an independent company, a letter from National Amusements according to people familiar with the situation is expected to be released shortly. But on both sides, sources tell me theyre aware of this very event development. This after the two Companies Engaged in preliminary discussions and cbs yet to make a bid for viacom. Mr. Backus i will tell you myself speaking to investors gaining a following among those who believe he has the finger on the pulse of what may need to be done at viacom. And so, in recent days there had been a sense perhaps not having the momentum others thought and Shari Redstone sent a letter indicating no more. Remember that letter i sent previously saying i would like you to consider getting together and the scale beneficial . Now i dont. I think viacom is better off as an independent company led by mr. Backus and she believes shown promise in the early days of his reign having taken over, of course, as an interim ceo in the middle of november, i believe, guys. Stocks reacting at this point. There had been a bit of a premium in viacom shares and an idea of a premium bid of cbs for the company and always remained in some question. Certainly the synergies of a potential deal were significant. Though some question whether you can realize all of them but right now thats all off the table. Leslie moonves to continue to pursue the independent path for cbs and now mr. Backus getting the backing of his most important shareholder Shari Redstone. Again, in this letter that should be released in the not too distant future and sent to the company saying, hey, we want you to discontinue conversations and we like the strategy youre pursuing. Wow. I think that obviously viacom many people are hoping for something but cbs has been trading an at pretty big discount to the s p. They have done a lot of good things. Cbs radio deal. I mean, they have to sell off 15 times earnings and earning more than four bucks cbs undervalued on that story. A lot of people thought that cbs paying too much no matter what. Its funny because the people indicated to me any deal any offer not fairly significant premium would fall on deaf ears and didnt appear to have the momentum and talk of leslie moo moonves and ms. Redstone negotiating for governance and whats most significant is performance of mr. Backus with confidence of the largest hair shoulder and i had conversations with viacom shareholders and see does seem to be on top of it. He will have the opportunity to per frm. This is the same day as fox sky and causing some people to downgrade fox and it is kind of a changing of the guard here. I fully expected people with cbs to do this deal and i think cbs if les moonves reiterates how well things are doing, why didnt i buy it under 63 . Thats a major story. See how cbs performs today and expectation is to hear from National Amusements and perhaps both companies, as well, to chime in with statements. That will now remain independent despite the story of scale, scale, scale and do you need it . Man ves interest of running it with tepid. I think there was interest, carl. I do. I think there was some relu reluctance. The movie studios dont come up for sale often. It is not my belief he was reluctant that he would not have pursued it but key questions and discussion over price which they never got to. They did get management presentations from viacom and that apparently is where its going to have ended and doesnt mean you wont revisit this. No longer going to happen for now. Big. Big story. Nice reporting on this. Thanks. Other big one this morning is lockheed of course down in the market after the tweet of the f35. The program is and cost is out of control. Billions of dollars can and will be saved after january 20th. Meanwhile, boeing striking a deal to sell 80 jetliners to iran for almost 17 billion and could threatened by opposition to the Nuclear Accord of western leaders and that country. That would be the biggest deal going back decades but we know where the president elect has been regarding twitter and boeing. Yeah. Look, all the appointees that are involved with defense and National Security are no fans of iran. I have to tell you, i was looking at the deal of the non opec and opec and saudis and cutting back and maybe the new president tweets he doesnt favor the technology that u. S. Technology going to iran including boeing and also oil service. The Lockheed Martin, everyone knows that the joint Strike Fighter is hideously overruns for more than a decade. Yes. But i dont know. No one thought that you could go back at this point and say were paying less per plane, period, end of story sigh that a possibility . There are contracts. Plenty of questions of the cost per plane and scaled up and still numbers are still extraordinary per plane. Same thing as United Technologies and pratt and whitney makes the engine. Northrup is involved. Okay, look. This opening bid is paying dramatically less per plane. And then what . They would the government sovereign. Lockheed cant sue necessarily but it is i think that Lockheed Martin ceo will have to say we have a lot of contracts with the government besides this one and we have a lot in the hopper. Frankly, im flabbergasted. I know its expensive and i was up at Pratt Whitney last weekend and didnt think they would president elect to say, listen, i wont pay for these. This is kind of etched in stone. Its etched in stone. No coincidence on the boeing side, the emphasis in this deal is promoting the number of u. S. Jobs that would be created protected by this kind of sale. I dont know if its insulation anymore. I dont know. I know youre marilyn houston and shes terrific, low profile, looking at the book of business and not so much necessarily negotiating. Maybe hes saying were going to prosecure differently. Look. Yes, he could say well buy half the planes we thought you were unless you renegotiate. The numbers north of north of 3,000. Already put into it. I dont know the specifics of these how the deals work and but everybody im sure well learn more. 2,400 combat jets. What he has the ability to do is say well take 2,000, 1,500. Heres the price to pay. He has that. Many contracts have been cut over history. Yes. How many we take of a destroyer, of an aircraft carrier. What he has leverage he has is not taking 2,400. We take 2,000 and youre going to or were going to pay for 2,000 and you throw in 400 for free. Anythings can happen. If the government is involved in paying any company you have to rethink what youre paying for drug stocks. The defense cut. Look. I dont know if people get to grasp this. This is very serious decision already obviously through a tweet that changes the way we procure and to bargain after the bargains been made. This is a done deal. Reopening it and say, listen, we dont have to take the planes and marilyn has to say we want you to buy 2,400. He says i wont pay that price. All through the whole supply chain, lockheed has to go to Pratt Whitney everybody takes a hit if has the case and its an inexpensive stock and more than i thought. I mean, all of the product. Next week . If they look one a week. Im assuming next week is something else. Going down the list of defense contractors and things that dont look appropriate in terms of cost. Darden . I was watching and reading articles of pepsico and salty snacks. Salty snacks are bad for people. I dont know. I dont think that will happen. Its the government nexus that matters. He kacannot be a moral leader. You say theres a screen i did that screen. Government contract exposure is nil . You have to look at whether your company is being paid or at the trough of the government. This week, theres two kinds of risk. Chief tins of tech and treats them like the media. They didnt vote for him. Thats hard to swallow and then the companies drug manufacturers and they exist. Lockheed martin wont make it up with the tristar. They got out of commercial years ago. Look. I am a little flabbergasted because i know that it was an overrun and ways to make it so theres a deal. And he can call marilyn houston. Why doesnt the president call people and get things done . Whether its boeing, carrier, now china and the one china discussion with Chris Wallace over the weekend, do you believe hes using hammer where a scalpel will do . I think if i do business with china, i think that what hes saying is, listen, you have to take some pain here. Well get the relationship back on even footing. And, you know, so maybe if you do business with china, just worry not the earnings per share of qualcomm. Why not four planes of boeing goes to china . But world, man. We are underestimating the impact of the volatility to occur here. How many people marginal market. You have contracts, law. David, you really just throwback. Is that what i am . A throwback . Old media. Old media . You have to get with the program. Contract. Okay. Sorry. Yesterday against in the eagles where a defensive fabulous guy hit by a washington redskin and should be out of the game. A bell rung. Heres a player, a bell ringer. Really is. Shes got a budget of how many planes to sell and suddenly it is like, you know, defenseless. Defenseless. But it is interesting allusion. Darren sproels. I saw that. That was wrong. Defenseless receiver hit by a tweet of a plan Program Everyone knew was an overrun. So many programs. Hit by a tweet. Sorry. Im sorry. Concussion protocol. Oh yeah a couple of weeks. She aint going to make the playoffs. Playoffs regular season game. When we come back this morning, the buzz of Rex Tillerson and could be president elect trumps choice for secretary of state. News behind that. Premarket, s p going for seven wins in a row. Hasnt done that in about three years. We are back in just a moment. Oh hey john, im connecting our brains so we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. Generosity is its oyou can handle being a mom for half an hour. Im in all the way. Is that understood . I dont know what shes up to, but its not good. Cant the world be my noodles and butter . Get your mind out of the gutter. Mornings are for coffee and contemplation. That was a really profound observation. You got a mean case of the detox blues. Dont start a war you know youre going to lose. Finally you can now find all of netflix in the same place as all your other entertainment. On xfinity x1. Exxonmobils Rick Tillerson seen as the frontrunner for secretary of state. But some lawmakers on capitol hill expressing concerns of the dealings with russia and president putin. Heres what president elect trump had to say yesterday. Hes much more than a business executive. He is a world class player. Hes in charge of i guess the Largest Company in the world. Its been a company thats been unbelievably managed and to me a great advantage is he knows many of the players and he knows them well. He does massive deals in russia, for the company. Not for himself. Tillerson has gotten the order of friendship from russia. Right. Ties into the story over the weekend about the cia and their view of what the russians were trying to do in the election. I wonder what theyre thinking. We have a special relationship under obama, better than with britain. Which is a kind of United Alliance against putin. Its hard to imagine tillerson whos had so many good dealings with russia and remember where its talking about oil. Not talking about ukraine. Right. You can bargain about oil and not a government bargain. Its a private industry bargain. Rex tillerson did a great job at running exxon and exxon is a far flung company. Although some people critici criticize some of the decisions over the last ten years. Shale effectively as they might have. The players you talk about all the time at the top. But thats not the same as selling estonia at the top. Little different. Estonia, latvia versus this is kind of a again, i expressed astonishment because theyre Business People really Business People who may have dealings overseas opposed to people overseas who happen to be Business People. Its just a very different thing to see someone like tillerson coming hat in hand with putin at times. Right. Yes, may be friendly, first name basis but, again, in the shoes of merkel youre thinking, all right, tillerson, not of the firment. You get another business person, gary cohen. I think we are anticipating any moment now appointed as the head of the national xhek council. Sbree yated in 93 under frormer president clinton and first staffed by bob reuben of Goldman Sachs. Unclear of who takes over at Goldman Sachs. Solomon will have some role there and should become clearer, as well, very, very soon. This is expected to be announced this morning. A guy, a business guy an one of the things that happened is business positions filled for the most part for people of the firmament or known and thats something i didnt think would happen in the campaign because we had an antibusiness campaign with a commercial of gary cohens boss and face in it. This is a bit of an about face and cohen is not known as a hard right wing and i wouldnt say thats not the case. So the business guys are economics advisers are looking like economics people. The other guys are looking like economics people, too. I remember late we should go back. We cant gloss over the hardees Labor Department head. Yes. When roosevelt, fdr always said thats a representative of the unions. This guys representatives of the antiunions. You saw snl over the white . Walter white. Head of the dea. I had walter white on to ask him when he was you know, brian cranston. I had him on air to ask him whether he felt that apple had as good of a distribution business of mr. White and he felt the product was superior and apple may have a superior product but a great product and sell more of it. Except if its crystal methane not the apple phone. A craving for tight, tight. You cant take this away but i have not methane invented by the nazis in the 40s to make soldiers not fall asleep. You can pry it from me before that was things are going nuts here a recent article of the nazis completely on drugs at all times. I ordered that book immediately. This is a different world here. We are. Well get the mad dash and opening bell countdown in a moment. Big week ahead. More squawk on the street from the nyse in a moment. Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. 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This was an