2015, and "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. we are coming to you live from new york city. by the way, that music there, that's the theme to boardwalk empire this morning. that's the day after joe and andrew painted the town red last night. >> pink. >> we'll talk about that. we spent some time together. andrew, you know, that is a big story. >> we had a lot to do last night. >> we did. here we are. >> this was fun. >> this is the premier of boardwalk empire. it's hbo's hit show going into its final soap. plenty of selfies from you guys last night, too.

>> a lot of selfies. >> including one with the show's star, steve bushemi. >> i to this take think those were only flashes. none of those cameras had any film in them. >> when you walked the red carpet? >> yes. and to get that many people to cooperate, to pretend -- >> they were not pretending. >> well, they weren't, but we did get introduced and they were like -- because -- what happened is you were so late because you didn't know where the bridge was, you were so late that all the stars arrived and they all go in last. so we walked through with them. so they were confused. they were like, there's a lot of customers. they thought we might be part of the -- >> andrew it served you well in that case. >> it did. otherwise we would have been welcome -- >> but then you left and i walked the whole premier alone. >> he was -- >> this is what a -- the mandate. >> it wasn't a mandate, but there's wing men and there's

buddies and -- >> i was there. i was there for you. >> you were there for ten minutes, andrew, and then he left and i sat for a hour at boardwalk empire totally alone. >> you had some news to break. >> check out the front page of the "new york times" if you want to know where andrew was busy. >> we're going to talk about that more often the. >> the front page of the "new york times," wow. >> on cnbc.com. left at the altar with mayor bloomberg. the bulls facing a major catch today. the s&p coming off back to back losses for the first time in a month. now, the two biggest events to watch, the ecb meeting in europe and the adp report here at home. the european central bank expected to hold rates steady. that announcement due at 7:45 eastern time. but the real news is likely to come in in, mario draghi's news conference. that comes at 8:30 eastern time and that's when the central banker could announce at least a hint, maybe, possibly stem ewe

husband measures to boost the economic recovery. draghi fueled market speculation when he diverted from that prepared text in jackson hole and warned inflation expectation is falling. at 8:15 eastern time, the august adp report polled forecasters saying the economy added 215,000 private sector jobs last month. then at 8:30, we're going to get weekly jobless claims. we get international trade and a revision to the second quarter productivity and costs, that's 90 minutes later. ism nonmanufacturing throughout the morning many of the nation's retailers will be reporting same-store sales. a lot to look forward to. take a look at futures ahead of all of this activity. right now, you can see green arrows, the dow opened up about 15 points higher, the s&p 500 close to 2 points and the nasdaq, we'll call the it marginally up for now. >> in corporate news, the ground breaking morning show "squawk box" is coming to you from new york city.

isn't that where -- >> i think that's -- >> that line. >> how many people have radio -- did you see -- >> i did. >> the music hall radio city through this pen you can hit this. and this is a really -- this is so cool. i wish we could move here permanently. a security website warns that almost 2200 u.s. home depot stores may have been hit by a massive data breach. the retailer hasn't confirmed yet that that breach occurred, but says it's working with leading i.t. security firms to investigate the situation. shares of home depot are down nearly 5% this week. but you can see that that is at an all-time high when all the other retailers are talking about a weak consumer, home depot is posting like 6% same-store sales just finished talking about frank blake like he was the second coming. so american -- dictates that.

>> and that's the point, though. >> apple totally defending apple. what's happening to you? >> how is it not his fault? when something happens on your watch. >> no, the question is going to become -- is it really -- everybody has their own security. we're going to find out. target had legitimate problems, meaning there was indications and they didn't do enough about it. are we going to find out home depot didn't know enough about it or, in fact, they had pretty secure systems and the hackers got through? so i think there's going to be a question mark about who ultimately do you hold responsible? >> look, i think this could happen to any retailer. i think it's likely to happen to most of them. in fact, i think we hear about some of them, we don't hear about others. so i do think it's a broad based problems, but retailers need to

elevate this to someone in charge of security, someone who sits on the board or directs is board and -- >> we've heard the retailers are the ones that don't have enough security. >> it's different from the banks where they're spending hundreds of millions of dollars trying to protect -- >> we'll find out. maybe it's a home depot -- >> the dow component. it is uncharacteristic. a big win for goldman sachs today. the firm is reportedly going to be the bank that's in charge of overseeing early share trading in alibaba. that ipo is highly anticipated offering in years to generate big fees for goldman. barclay's was said to be the leading floor trader. an official ipo date has not been announced, but the big event is expected next week. and it's nouft jt about alibaba, but it's about people that have -- in the market. what could this thing do, depending? if you're an underwriter, i'd go

nice, but not too knight nice. i would want this thing to double or close to it. and there's a chance it could. >> the argument is that you want things to do well, but you don't want to waste too much money on the table. obviously, you're still holding -- >> i always do the double because 5% by 95. >> even people that -- of course, when people buy in the aftermarket, they -- >> it's like they pull up the bag. why don't we keep an eye on shares of yum brands today. that stock taking a hit after the company warned same-store sales in china probably fell by about 13% in the third quarter and continued to decline. sales were hurt by another foot safety scare. in late july, news surfaced that a former supplier was said to have used expired meat. back here at home, fast foot food workers are planning to walk off their jobs in major cities across the country today. mcdonald's, burger king, wendy's

and qtc are likely to be affected. this is the latest effort by an ongoing campaign by fast food workers to get a wage increase. they want minimum wage of $15 an hour and be allowed to form unions with that retail age. here is the story that interrupted my mandate with joe. a brief interruption. >> it was like going to a movie and leaving in the middle and coming back. >> and then i couldn't get back to where i needed to be in terms of, you know, having fun and everything else. it was a date that -- >> we left the evening really very nicely, though. >> we did, we did. it was fun. >> i told you that after you made me wait 50 minutes, when i was hoping and praying so much that you would come and that i would see your face, i just was not comfortable. like, is he going to show? and when you did show and my heart leapt because andrew showed, that made me -- i don't

know. it showed me a new side, i'll tell you that much. but if you hadn't come -- i will tell you something that did happen because you didn't -- every actor walked -- they thought i was security. every actor walked past the door where the red carpet was. not a single one watches -- who immediately wanted pictures with us? >> the agents. >> the agents. >> the agency, aa, all these -- and right after we got to bushemi, the two of us, he was like, yeah, sure, if we must. but right after that, people had come up and mobbed up and were getting pictures. but he is already turned around. >> my heart leaps every time easy you, every morning. i know you don't believe it. makal bloomberg is returning as head of the data financial news company that he founded 33 years ago. current bloomberg lt president

co dan docarov is stepping down at the end of the year. this to me, you just don't -- michael bloomberg was not expected to come back. he was planning on working with philanthro philanthropy. i started hanging out at the office a little bit, then a little bit more. >> didn't stay in bermuda? dan said mike is like a god at the company. he created the universe, issued the ten commandments and then he came back. when god comes back, things are going to be different. when god reappeared, people defer. tan was the one who wanted to step aside given the power dynamics. i think it's tough to be the ceo of a company with the founder with his name on the board is one cubical away. >> we're basically talking about the global box business. >> terminal business. >> is that what we call

bloomberg? >> that is 99% of what it is, right? >> 99% of -- i mean, they have the media component. >> west law and -- >> normally, we would be hesitant to talk about competing services. in this case, i look at him fondly. he's been around for so long and you need competition. me do a good job, i think, but they never have -- i don't know. at this point, is it a competitive threat to cnbc or -- >> well, we should talk to the ceo about it, who is going to be on a in a little bit. my question is for the future of the company, they took it more in a consumer basing direction and are creating these verticals that are there. the question is mike going to continue with that strategy? and he says he is or long-term if you are a terminal guy and what that means. >> in the united states competition is never a bad

thing. it's people looking for the same market share and it makes people better. it could help. it's always good for competition, right? so we don't want the markets. >> wow. and you're in favor of this one. >> good. >> let's get a check on the markets this morning. if you want to take a look at what's been happening with the futures, you'll see right now that the futures look like they are indicated higher, up by about 13 points for the dow futures, s&p up by 1.5 points. take a look at what's been happening with oil prices. crude oil recovered mostly the losses we've seen the day before. this morning, down by about 44 cents been 95.10. the ten-year note, yields yesterday picked up a little bit. right now, that yield is down below where it was yesterday at this time, yielding 2.40 5%. also, the dollar this morning, looks at this point like it is indicated up across the board. the euro is trading up at

1.31 4/5. gold prices at this point slightly higher, 1,272.50 an ounce. ahead of the ecb meeting, seema mody joins us now. what? we're in new york and you're in london. >> i have to come across the pond to be on this show, too. it's really interesting for european markets. the prospect of a peace deal between ukraine and russia sent european shares higher in yesterday's trade. but today markets are slightly lower ahead of that all-important ecb decision. prices headed towards what seems to be deflation, geopolitical tensions o rise, specifically between russia and ukraine. the pressure is on for mario draghi and the ecb to come together with a plan of act. the big question is whether the ecb will unveil immediate steps. possibly by purchasing

government and cooperate bonds, kwaut tafb easing, reducing rates, that seems to be unlikely since rates are so low. another option is buying asset backed securities for eurozone banks. the meeting will take place in about three hours, followed by an all-important draghi press conference. the ecb for draghi, late august at jackson hole said that the ecb will use all available instruments needed to ensure price stability. since then, you see the stoxx europe 600 index gaining about 2.5%. the latest read on gdp was disappointed. inflation has dropped to a 5 1/2 year low. unemployment is at 11.5%. which is pretty much at the same rate it was at this time last year. so a lot of challenges facing europe and that's why we'll be keeping an eye on the ecb decision. ahead on that, european markets slightly lower. back to you. >> thank you so much. we'll see you again tomorrow. in the mean team, european

central bank is hoping that monthly policy meeting today, market are anxiously awaiting that announcement because it could be different this time around. teresa marr, sri, darrel, gentlemen, thank you for being here today. >> thank you, becky. >> wooerp playing up this whole idea that the ecb decision could be different this time. mario draghi signaled that maybe there's something more on the table. do either of you think there is going to be some sort of stimulus today? >> mario draghi keeps making announcements frequently. but i don't think it's going to be anything significant. they've already made the rates slightly negative for banks which are leaving money in the ecb. it's a little more negative today. but that's not going to do anything to turn around the eurozone economy.

seema has been talking about the problems with unemployment. even germany has had a drop of gdp in the second quarter. what if eurozone needs urgently, will the motorcycles flip ability like you have in germany, and whether the interest rates minus 50 basis points are not going to make any difference to you any longer? >> do you agree with that? >> i do. i think you could see an announcement with additional negative interest rates as sri is outlining. i don't think we see quantitative easing across the sovereigns like a lot of the markets want to see. if that's the case, what happened with the euro? the euro has been under pressure on the expectation that we could see something more. does it stay at these levels or shoot back up? >> it looks to us like the euro might have overshot the down side a little bit at this moment. but actually, we went tactically overweight europe equities. we think there's good value there right now.

the negative surprises relative to places like the u.s. are at extremes and the underperformance is there to match. we think there's value. you look at europe, it's trading at 13 times earnings next year. we do think the ecb will continue a monetary easing path. maybe not qe, but a monetary easing path. and the yield is 3.3% on european equities right now. >> years, they always come up with a plan for a plan. >> but there's -- and the euro is overbought? that thing is worth like $1. it is. what do you mean it's over -- who would go long the euro long-term given -- >> joe, i would agree with you. >> you do? >> at 1.32, i think it's grossly overvalued. it needs to be -- >> but the people have been saying that for years. >> the reason is, i think the problem is more on the u.s. side. anytime the euro looks like it's about to weaken, you have a -- before that that ben bernanke

state of further easing. and that causes the dollar to weaken. in my opinion, the euro strength has little to do with europe itself. the german bond has gone below 1%. the liquidity expresses, has done anything to weaken the euro yet. >> with the economy we're in right now, people are looking at it saying this is insane. ism, unemployment, all these things are doing so much better. >> if yellen ever does become a little less dovish -- >> spot on. that's what i think. but i don't expect yemen to become any less anytime soon.

>> i would see her becoming more dovish. i don't see any increase in the united states in all of 2015. >> the ten-year is going with 2% when everybody is looking for it going from 3 to 3.50. >> i'm not sure that we could necessarily agree on that particular point, sri. i think 2015 is definitely the year we start to see the federal reserve reduce or raise interest rates. durable goods, ism, construction, newhousing starts, existing homes, it's all beating consensus consistently every single day over last two weeks and beating it by a lot. >> it has to change. and i think that will happen.

and while i see the point and the strength in ism, a lot of that is happening. the question you have to ask is it's taken out of the oxygen tent. rates are going to go up, that's when we'll see the test for the equity markets. >> not much. the new prime minister has made some steps to cut taxes. >> that is so far down that road, though -- >> but the labor market is still very rigid. >> each though we have worried about drift, we're still nowhere near --

>> nowhere near that. >> one other thing, joe, remember from a capital markets standpoint, we've seen this movie before, right? 13 times forward earnings, monetary stimulus coming. things are not completely broken in europe. it's a good entry point for investors, i think, at some of these levels. >> darrel, sri, thank you both for coming in. when we return, george clooney's big scam to turn the celebrity hacking scandal into a movie. plus, are you ready for some football? big day is finally here and you can see it on nbc tonight. we'll have the squawk pregame coming in the next half hour. [ male announcer ] the wish we wish above all...is health. so we quit selling cigarettes in our cvs pharmacies. expanded minuteclinic, for walk-in medical care. and created programs that encourage people to take their medications regularly.

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welcome back. george clooney has a new project. rupert murdoch should be taking notice. the hollywood star wants to draekt a film on the hollywood phone hacking scandal. it's on how the guardians exposed the extent of the hacking. sony pictures is the studio behind the film. >> no plans at this point on anything on lois lerner or the irs. hard to believe he tried to cast rupert murdoch in a bad light or something.

this is what they need to do. remember the fox time warner deal? remember the look of the faces of people? >> how high did they go? >> in terms of pure drama, being able to hack into the phones. >> you can see it in your heads. >> you tell me about sloonny, i'm not going to like what he's doing. he's from cincinnati. i know his father. he's a huge news caster my whole life in cincinnati. >> korea. no plans for the lois lerner issue. the reported home depot security could have impacted any story in the u.s. regular kwan has that in her

latest response from home depot. it's dangerous when i say this stuff. am i allowed to say this stuff in new york city proper. >> you're not going to make it out. >> maybe not but -- >> is george here? maybe that's the death star over -- >> george is in new york all the time. he could be sitting next door. >> yeah, he might be. we need to be concerned about home depot potentially if we shop there. there are many, many stores in the united states. actually, 2200 of them. home depot putting out a new statement yesterday saying not only are they working this and law enforcement, but also security teams and they're naming them. they're naming symantec and fishnet securities. they've been working around the clock since they first became aware of a potential breach thursday morning. it probably is, but they have all of these folks involved.

krebs on security.com was first to report the breach. now based on some zip code data has been has found onlike, all of those 2200 home depot stores could have been affected. no word on if this is a confirmed breach. >> they found out when that report -- >> tuesday morning. so it appears as if right now when the credit cards became available on the black market. >> what's when they found out? >> that's when they found out. >> so the question is are we going to find out, there were these indications early on. target at the time said they were learning about it for the first time and then when you really went back, you found out there was a bit of a different story. is that possible in this distance? >> it's certainly possible. from what we understand so far of wakd be, there are markers that are similar to the target

scenario and there are some that are different about it. and it appears home depot is being very careful about what they reveal and when they reveal it, but keeping us very updated. i think they are trying to learn from some of target's mistakes. i think what's going to be interesting is the consumer response. i shopped at target, i used my credit card during the breach and i still go there and still use any credit card. >> same story with me. i do think it's how the company react. i know target took a lot of flack. i feel like they were much more forthright about things than other retailser who we need got hacked at the same time and still haven't come clean about it. >> and home depot said, look, if there is a breach, you're not responsible. it seems like they're lining up all the pieces that they're going to have to employ once they have the information they're going to share. they probably want the be careful, they want to give you all the information they possibly can as soon as they can but not just drips and drabs of

it. >> courtney, thank you very much. when we come back this morning, some wild cards. the threat of isis, the crisis in ukraine, libya in turmoil. how much longer will the markets shrug off these headlines risks and can the markets handle all these situations at once? we'll talk about that next on "squawk box."

welcome back to "squawk box" here on cnbc. i'm joe kernen along with becky quick and andrew ross sorkin. what time is it?

we need to mention, from radio city, music hall -- >> i can see 30 rock. >> and you just see the lights come up. this is the answer to you. you are -- i mean, you're so big. you're "new york times," you're deal book, you are anchoring the morning show on fifth avenue at radio city. >> i'm not complaining. >> you're feeling it? >> i am. >> the video makes it look like -- >> the date was much longer than ten minutes. much longer. >> you're my wing man on a big premier stage. >> we had this michael bloomberg news to contend with. >> talk to the person next to me? what was i supposed to do? >> do you have an empty seat next to you. >> i did for a while.

two guys came in and it reeked of -- oh, god. how are you? >> and then he came in. >> tesla reportedly choosing nevada as a home for its new $5 billion giga factory. and he's got, you know,

obviously there's a -- you know, you can't say the horse in the race. and he will still tell you that to 1000, $1500 for tesla, it's a great company, but it's not just going to -- it's not going to happen immediately. everybody is not going to be in tesla anytime soon. >> when you switched off, yesterday about the growing tension in turmoil around the world. >> as many wild cards floating out there that had the potential to be very significant and falter people's thinking. >> from ukraine to russia and syria and iraq, parts of africa, there are a ton of factors that the market is trying to digest. joining us now, ooep ian brownor. thanks for being here. >> good to see you.

>> prioritize the list, if you will, if you were thinking about the united states in terms of how we're supposed to think about all of the potential pit falls and problems out there, what sort of topped your list? >> these aren't all discreet. they're not all happening randomly at the same time. you have all these different wild cards and any of them can go boom. the fact is, you have the united states that does not want to do as much internationally. you have a europe that's much more led by germany, which has a very different outlook on the world, much more economic than geopolitical. and you have the rise of countries that matter a lot more economically and lily that don't support u.s. outcomes. you put those things together and you start to see that the seeds of conflict in asia, in the middle east, in eurasian are actually very similar. this is structure and this is going to continue to spiral for some time, until we see a world order that people -- >> when the president last week says we don't have a strategy,

and that was around isis, is that actually represent something larger? do we have a foreign policy strategy right now? >> we don't have a doctrine. i know don't do stupid stuff, it's not a strategy by itself. that is certainly a stereotype of -- >> take you pretty far, though. >> that's right. having said that, we actually did it with work very well. >> what i thought was interesting was we looked at those trouble spots and now you're actually working with them. north korea is not there. these are the things that almost boiled over. the one that matters most for the markets right now absolutely is ukraine. because it is likely -- >> unless isis sneaks across the southern border and does

something horrific, is that possible? the likelihood of european res session is -- >> isn't europe and the uk in danger of something? >> no question. the likelihood of terrorism. >> that the market won't respond. >> are you surprised that the markets have not dipped or even really seem to be impacted by all these things? >> and the markets have moved all around on ukraine in particular. but it's been whiplashed by the unless of the headlines. it's not structural. the markets don't respond structurally to geopolitical conflicts until we see the scenarios that -- >> the biggest threat is the european recession. >> the reason for that is because it is likely to happen, right? we're not talking about there's going to be a terrorist attack,

we're not sure where, we're not sure if the market shrugs it off. i'm talking about the fact that the baseline scenario for russia and ukraine is that the ukrainian economy is imploding, that the russians will not be able to do effective business with the europeans on a whole host of key factors. the russian economy will take the biggest hit, of course, but the europeans are the ones that are very exposed. and you've gone past the point of no return. we can talk about a cease-fire. nato summit is happening right now. but the fact is that we're not getting russia back. russia will be considered a rogue state by the united states. only problem is, the biggest emerging markets around the world, including china, are only profiting from that. so you can punish russia, yes. can you isolate them? like you do with iran? you slightly cannot. that policy has been a failure on the part of the united states and its allies and it's going to cause a lot of problems economically. >> thank you for helping us through all this. coming up, the countdown.

tonight on cnbc, al and chris are loud and proud. those are my two favorites thus far. pregame snap and expectations for the 2015 season. i know what you're thinking...

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the 2014 nfl season kicks off tonight on the best place for that to happen, nbc. joining us now to talk about the upcoming season is nbc's sports

anchor. this is the first game since we saw how good seattle really is. don't you think? >> well, yeah. we've seen how good seattle is the last two years. especially in seattle where they were 15-1. >> so good. >> right. >> what was the score there? >> 43-8. >> 43-8? are you kidding? >> they are head and shoulders above the rest. that's before they ended the season. but the broncos went out and did a lot in the offsoap, upgrading their defense, adding demarcus ware and the broncos have come a long way since last year. >> you say that's a fan. >> i say it as purely an analyst, not as a fan. even though they reduced wes welker, they loos lose eric degge, a much better football team this year than last year.

>> so it was amali? >> it was. >> he says the drink was spiked or something. isn't that the news? he claims his drink was spiked? >> it's not a young guy -- >> it was reported that it was amali that was laced. i don't know much about these drugs these days, but that is the word from the kentucky derby. >> you were racing last night. >> i was up watching novak djokovic. >> so was i. what happened? >> novak got behind. >> i saw the first one and he didn't show up for the tiebreak. but then he won the second one, same score as the first one. did he just run out of gas? >> close draw. he played some very good tennis. he got a little spring in his step, he's done some dancing in the tournament. he was poised to win another u.s. open. >> i couldn't believe -- >> morenka. >> what's the guy -- yeah,

morenka, the number thee guy. >> initial corey. japan gets their first semifinalist in 96 years. >> he was going crazy. >> and the japanese player took 8 1/2 hours in his last two matches alone. that's about what i do in a week. >> do you want to call it? >> how is caroline going to do against the girl from china? >> wozniacki is going to win the tournament. she is playing some outstanding tennis. >> all the articles are about her today. >> who is going to win the men's? >> i like the number one seed. djokovic is just -- i. >> i hope it's federer, though. >> if you look at the brackets, can they both stand up there? >> djokovic started the bracket, but the two seed is --

>> federer. >> yeah, we do need to get back to football. this is seattle/green bay. the two best teams in the nfc. this will give a good glimpse of where we are with the super bowl. >> i've watched everything. i watched the world cup like every game. i'm glad it's coming back. >> are you going to be up watching the nfl kickoff with the 20 or 30 million other americans? >> at least part of it. >> go home, take an afternoon nap, get back up because this is going to be as big a game as you see all year. this is the fail mary from two years ago, the controversial win that the seahawks had over green bay in seattle. this is the second best team in the -- >> games on sunday. >> denver and indy has to be as big as you get. that's on nbc, sunday night football. so you get a glimpse of how much better denver's defense will or

will not be against the colts who some think could win the super bowl, as well. that will be a nice matchup. your team, the cincinnati bengals, a division of football against the ravens. i think your team is going to win the division, but they need to come out and beat baltimore and make a strong statement. there are some outstanding games this weekend. everyone is still hungry. 17.5 million people on average watch every game. >> just because -- on the tv still are the biggest games. >> without a doubt. come on, that's not my nbc advice that those are the best games of the week. but they're two of the best games of the year. tonight will be outstanding. 8:30 the kick off. >> a little siesta. >> you can't tun it off at halftime. >> i'll take a mali and stay up

the whole night. >> wow! >> no, no, no, no. >> i'm not, i'm not. >> we're in new york, couldn't find the big show. >> welker emphatically denies the report, i should say. >> and i deny that i -- >> i don't even know what mali is. i'm an old man. >> i have a black one and an orange one. >> thank you for coming on. >> all right. 8:30. stay up. when we come back tonight, the new york city edition of chairs and auto nation invades the big apple. mike jackson will be joining us with the auto numbers and a trio of specialties in the driveway. "squawk box" returns after this. don't just visit rome.

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we got to update that. we should do that today. stay up and do that today. these are much better chairs. anyway, we are literally in chairs that if i were to sit back -- number one, they're cold. aren't they? because the studio is cold. i sat down and i went, whoo! . wow. and you can't sit back, either, or we will look -- >> no, watch this. you want to see something funny? >> you got a -- the slouchier the better. >> we'll talk more about our

night together last night because it was a hollywood night. and my point about hollywood, you know, you take everything, you know, sort of with an open mind. so george clooney decides to do a business story. gee, i wonder what the business story is going to be about. so it's about rupert. it's about the hacking at news corp. remember matt damon's latest offering? what has happened in the last five years that has set potentially this nation up for one of the greatest manufacturing booms, cheap energy, cheaper -- what is hollywood's take on that? >> wait a second. in matt damon's defense we had him on from davos and he's concerned about water. >> i know he's concerned about water. >> are you surprised to see him take that angle. >> hollywood makes a movie about fracking, it's not about jobs in north dakota -- >> -- the story. >> how about your friend clooney? what was syriana about? nasty oil companies operating

over there, blood for dollars. you're not going to get a normal pro-business, pro-free market movie -- you're going to get wolf of wall street. you're not going to get those. so to say isn't this interesting, that, wow stop the presses. clooney's going to slam rupert murdoch and news corp. how did he come up with that? do something that surprises us, george, would you? >> i think it -- i will bet money it does very well at the box office. how about that? >> i don't know. i'm not sure it will. >> we will see. we will see. a story that caught my attention today, this was an ap story about millennials, and trust. we always talk about the sort of loss of trust. >> mm-hmm. >> it's horrible. did you know -- so, you grew up, i won't age you, in the 1970s, baby boomers were coming of age, about a third of high school seniors agreed back then that most people can be trusted. apparently in the '90s it dropped to 18%. and now in 2012 it dropped to

16%. >> it is worse than even when tim o'leary was saying don't trust anybody over 30? is it worse than -- >> i suspect -- don't you think it's a social media thing? >> i do think it's social media. also i think it's the way people are brought up nowadays. for example if someone says i will meet you at 6:20. >> last night to begin our date. i was supposed to meet you at 6:20. >> and then they show up at 10 after 7:00 -- >> i was just trying to make your heart grow fonder. >> i was thinking, this is his way of finally getting me back for all the other -- >> he gotcha. >> yeah. for all the other stuff. he's going to make me want him so badly. >> and it worked. >> absence makes the heart grow fonder. >> it did work. even this morning. now i'm -- you know, i've been conditioned now to look forward to it. >> very nice. coming up, the right policies to deal with global hot spots and terrorist threats. dan senor is going to join us. also steve ratner is going to join us on the set. "squawk box" live from new york

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tension flaring around the world, from isis in the middle east, to the crisis in ukraine, a front and center look at why all these flashpoints aren't sending shockwaves through wall street. >> fast food walkout. thousands of workers across the country set to protest in their quest for higher wages. what impact will that walkout have today, and down the road? >> and content is king. legendary tv producer tom warner and best-selling author lay out the future of media in the netflix world as the second hour of "squawk box" begins right

now. good morning, everybody. welcome back to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. and we are live in new york city this morning. that's right. live in new york city just on sixth avenue. this is where joe and andrew had a big day out yesterday at the premiere of hbo's boardwalk empire. >> well, that was the highlight. ♪ if you told me he wasn't going to wear a tie and the excuse was that the undershirt was not a v-neck so you couldn't just open the collar. >> didn't want to open the collar. that's true i didn't want to just open the collar. >> he was unable -- we got -- you know, selfies, no one looks normal in a selfie. you just look like a dweeb. >> you look like you're schott toe shopped in. >> you can't even see, that's -- >> one person said is that your

son, joe? he's a fine-looking boy. one person said that making me feel really -- >> really. >> that, okay. go back. okay that was at the party afterwards. you saw all the actors coming in. only one person really want to talk to. the guy who runs hbo the really handsome well put together guy. he was all over sorkin like -- you guys were talking valuations, you were talking this. what was that about? you guys were -- >> we work to the. remember they were maker of too big to fail. >> well, that was like -- see being with him, his attention definitely left me at that point. and went fully with -- but did you guys look around? are we going to look at? >> this is our location. we've got the time life building right there. radio city, that's to the south. radio city music hall to the east. to the north we have ubs. duh! we could have a few guests come

from ubs. they got to walk across the street. and then to the west, unbelievable like peep show place right over here on seventh. >> you checked it out already? >> that caters to -- why are you laughing? >> you're a funny guy. >> yeah, thank you. >> you know, you were on -- this is "squawk box." you were on some other show already. >> i came to the wrong place. >> we're on the set in new york. >> i'm in the wrong place. supposed to be over there. >> but you're right here, though. >> it's nice being here. >> thank you. >> all right. okay. we are bringing down the house in new york this hour with a special guest host, ben mes rick, the prolific author is going to be ready to talk about his latest project and the future of media and technology. he is bringing friends, film america, producer, bad boy brent ratner. a different ratner in this case. the hollywood legend has an idea or two about saving the publishing industry. >> first breaking news out of

europe. the bank of england deciding to keep its key rate unchanged as expected. up next the european central bank. nay come out with their rate decision at 7:45 eastern time. that's just about 42 minutes from now. investors will be watching ecb president draghi's news conference that comes later. that's where a lot of people expect some new stimulus measures to be announced and that will be key for the markets today. it is a busy morning on the economic calendar, as well. in the next hour we'll get no less than four reports in a 15-minute span. first up the adp private sector jobs report for august. we also get jobless claims. the july trade deficit, and second quarter productivity. and we've been watching the futures this morning and they have been indicated slightly higher. dow futures up by just about 5.5 points. or i'm sorry dow futures up by about 40 points, the s&p 5.5 points and the nasdaq just over 10. take a look at what's been happening with the ten-year. you'll see at least right now the yield is sitting at 2.416%. >> it's gone up a little.

>> the 2.41. it's crazy. vice president joe biden grabbing attention, who could believe it, he's blunt. joe was blunt. his shockingly blunt comments about isis. saying the killers of two americans will have to answer for their actions. >> when people harm americans, we don't retreat. we don't forget. we take care of those who are grieving, and when that's finished, they should know, we will follow them to the gates of hell until they are brought to justice. because hell is where they will reside. >> so, how worried should we be that a major flashpoint could quickly get out of control? joining us now is co-founder of the foreign policy initiative, steve ratner is chairman of willet advisers, former counselor to the treasury secretary, and we are certainly going to talk to you about andrew's big story here, which

you know, ruined my night last night, because you -- >> why did it ruin your night? >> because i was waiting for him -- >> we were on a mandate. >> i spent ten minutes with him, steve. out of three hours. >> i had to duck out. >> he's a business guy. he has work to do. >> and you don't really watch boardwalk empire. >> i do, but i wasn't -- >> no, you're not up to date. >> i'm not up to date. now you are up to date. >> a rich tapestry of amazing stuff and it was a great premiere. let's get back to we talked to ian bremmer earlier, gentlemen, and i -- he did have some insight in this. until the worst case scenario comes to pass the markets don't seem to do anything. and right now we're just worried that europe might slow down because of ukraine. i worry about black sworn horrific scary things, because isis now has told us they want to come here. they want to go to europe. they want to go to the uk. are the markets ignoring something that could imminently happen that could really derail this? >> what the isis crisis in the middle east and putin's actions in ukraine have in common is

that both have basically said, we don't respect borders. borders that have been in place 50, 70 years. >> or international law. >> international law. just the notion that putin can say, you know, raise serious questions about the ukrainian border. the idea isis can say this iraq/syria border, they can wipe it out. where would they go next. would you surprised if in a week or two they were threatening jordan? imagine if they moved into jordan, into a gulf country. this notion that these internationally recognized borders that both these crises are seeking to wipe out could have this sort of trend that continues cass cading effects through multiple -- >> is isis more dangerous by the way than al qaeda? >> yes. absolutely. look, when i was in iraq in the early 2,000s we thought that the abu musab al zarqawi, the head of iraq, he had done something al qaeda had never done before which is slaughter fellow muslims. that's what zarqawi's done.

we were struck by that. they are literally trying to wipe out borders and trying to build a real caliphate. al qaeda was spectacular attacks against the west not trying to build their own governing space. >> is it harder or more difficult to fight somebody who is trying to build a state like that? it almost seems like it's easier to attack somebody out in the open than guerrilla warfare. >> you certainly -- there's certainly in a space that you can strike. but they are not a government that you can ultimately -- >> that was the -- >> the other point ian made steve was that we're in a world where for better or for worse america is not going to be as out front in tackling all of these problems head-on and people seem to know that. did that -- is that part of the problem? >> let me say a couple things. first of all, i agree with everything dan said. happy to know pretty much everything he said, it's all true, it's all happening. but to put a little bit of context, it's certainly not the first time that countries have

decided not to respect borders. in 2008, russia invaded georgia. moldova, this has happened before. and it will happen again. i do think the isis thing is particularly scary because of just the blood thirsty nature of this group and what they've done on a human level. but when you ask a question about markets, why has it not affected markets? because this is all very far away, involving relatively small number of people who are not involved in the sort of global economy and therefore, if i were as an veefr, it didn't frankly scare me that much. the one piece of it that's -- could scare the hell out of me is oil. and what happens if the whole middle east goes because we don't have a lot of extra production capacity in the world. and you could see an effect on oil prices. >> you remember when iraq didn't respect kuwait's border? >> that's my point. >> we did do something. now -- >> what if jordan was suddenly under threat? what if lebanon was toppled? what if there were suddenly a threat on turkey? how would the markets respond to that? >> at some point certainly the markets are going to see this as vast global instability.

but i think that's a little ways away. and secondly, look -- >> isis capacity to move quickly is -- >> okay but look -- >> can be surprised in a way that it's not. >> let's also be realistic about what we can do and what we can't do as a country, right? we are not going to start the third world war with russia over the eastern part of ukraine. we're going to try to reach some resolution hopefully. with respect to isis, i think there is a realistic ability and probability that we the west, including hopefully some help from europe which, of course, has done nothing so far, will contain isis within some area. but the idea that we're going to eradicate isis from the face of the earth i think is totally unrealistic. >> another point that ian bremmer brought up is the more likely scenario is you are dealing with a recession in europe, that this will come because of the situation, the standoff with russia, no matter what happens politically from here. >> look there's no question, you want to talk again about scary economic things europe is really scary. not actually that much because of russia. russia has some involvement in this but they have huge

structural problems. they're in a skwaussy deflationary situation. countries like italy and france are disasters. and draghi's going to do whatever he does. but that's not going to solve europe's problems. europe has to deal with its structural issues and there's very little sign they are going to do that. >> if you are putin and you look at what should be deterrents against continued escalation, certainly weakening european economies is one. buts are, also which is connected to the second unwillingness to commit real resources to defense budget. only four of all the nato countries are committed to the minimum 2% of gdp dedicated to defense spending. it's a joke. europe's defense capabilities have been completely hollowed out. and if you're putin you're looking at that, you're thinking, who's actually going to stop me? ukraine's not a nato country. nato and europe and the u.s. do not seem committed in any way to arming the ukrainian military. the european countries are not dedicated real resources to their own defenses, let alone trying to stop me. what is the deterrent --

>> europe is sleepwalking through history. in the cold war era europe accounted for 75% of nato's budget, today it's down to 50. so sure europe is not doing its job. but we are going to have to step up -- >> we're not going to -- we're not going to take on the russians militarily, dan. >> no. but you've got to motivated ally in ukraine and a serious president in ukraine who wants to take it on. why aren't we providing lethal weapon capabilities to the ukrainian military? they could use anti-tank capabilities, anti-aircraft capabilities, they could ruse drones, they could use basic parts for their armaments that europe and the u.s. has. why aren't we supplying them with what they need? >> we obviously can supply that. that's certainly within our means. that's a defense strategy question. the question of how close we want to get to actually confronting russia. >> just ask you one back to economic question. you talk about europe. and everybody talks about europe and what is ailing europe. and everybody says the same thing, it's these structural problems they talk about. it's a labor issue, and a structural problem. isn't it a result of an entitlement state mentality,

which causes labor to become totally -- where no one can be fired. everyone has three years -- do you not see that a creep towards kshs and i'm asking you for a reason because i don't think you would stop the entitlement -- >> no. >> it's a loaded question. >> but isn't that what's wrong with europe? you cannot give people everything and -- >> this is going to come as a shock to you and all your viewers but i completely agree with you. and i'll give you one tiny tangible example. when we rescued the auto industry here we basically made them cut a lot of jobs to make them profitable again. when france put money into peugeot the condition was -- >> keep people. >> 54% of gdp in france is towards entitlement funding. you can't run a country that way. >> i agree with you. >> steve -- before we go, because we're going to get wrapped, got to give us a view on bloomberg. you worked with him for a very long time. what is he doing coming back? how is it going to be different? what do you think happens? >> i think your story today they were as clear and as transparent with you, i don't want to speak for mike and the company. i think your story was as clear,

as transparent as any company has ever given anybody when they go through a change like this. it's mike's company, as dan said, god came back. brought the ten commandments with him, and mike is an incredibly energetic guy and he has a great vision for the company. >> okay, thank you. >> aren't the questions better on this set than >> everything's better. >> it is, right? >> the location. >> the location. >> i mean, come on. >> we're not mentioning any names. >> look around. >> right. >> you got joe and joe -- >> right. >> his name is charles. that was taken by the other scarborough. his name is charles and he stole mine. >> gentlemen, thank you very, very much. we've got sales figures from the country's largest auto retailer autonation's mike jackson joins us next. he'll give us an in-depth look at some mercedes newest models. and flipping the script on the publishing process author ben mezrich sold the movie rights to his new book before he wrote the book. he's going to join us onset at

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this calls for a little touchdown dance. don't miss the fall kickoff sale at mattress discounters. ♪ mattress discounters welcome back, everybody. autonation is rolling into the special "squawk" new york newsroom this morning. the company is reporting its august auto sales up 7% versus the same month a year ago. mike jackson is autonation's chairman and ceo.

mike, it's great to see you. >> becky, great to see you. now the comp was difficult august of last year was a fantastic month with a selling rate over 16 million. so to be up 7% on top of that is really quite something. and the big drivers are truck sales, up 9%. and very strong premium luxury business for us, up 12%. >> you've told us in the past when truck sales are up, it is really good sign for the economy overall because it means contractors are coming back. is that the same -- >> and that's proven to be true. look at the economy. i think throw out the first quarter. as an anomaly. i think that economy's now growing at 3% gdp, adding over 200,000 jobs a month. so the economy is clearly on the move. and if you look at august, the auto industry is doing its part. with a selling rate of 17 million, 500,000. if you annualize august sales. so it's really quite something. >> you had paulson, not pat, and not hank and not -- but jim in

this case, said two big tail winds the fed that's starting to ease and also corporate profit margins and corporate profit margins are at a top. i don't usually listen to doug kass. you sell when the sound of trumpets are blaring, 17 million. there's nowhere to go but down. isn't this peak sale? >> oh, absolutely not. >> we could do 20 something? >> no the rate of growth is slowing as the years roll by. you know we had double digit growth and then last year it was plus eight. this year it will be plus five, maybe plus six. >> you preparing in any way for a slowdown, mike? inventories or anything? no? >> i think we're going to have a sustainable rate between 16, 17 million -- >> for years? >> for years. until the federal reserve decides that the economy is overheated and significantly raises interest rates. the auto industry can handle a normalization of rates, which i expect to begin next year. that's no big deal. but the drivers in auto are

genuine replacement needs, the average age is still 11.4. exciting new products. >> you're going to see yellen, right? we'll ask you about that later. you're going to see her? >> i'm joining her for dinner next week at the federal reserve. there in washington. there may be other people there, also. >> there's you, who -- got all your connections. >> but you know, i'm part of the federal reserve, i'm on the atlanta board. and i have great respect for two institutions. >> we're going to talk about that outside. all right we've got another -- >> we've got -- >> we're going to stay with mike. >> but we got to take a break. >> we're going to go outside with this whole party. he brought a couple of the latest vehicles from mercedes along for the ride this morning. we'll kick those tires in just a moment. stick around, "squawk box" will be right back. time now for today's aflac trivia question. what name was given to boston's 1967 pennant winning season. bre.

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now the answer to "today's" aflac trivia question -- oh, oh, okay. we are -- >> sorry. geez. excuse me. >> that is a beautiful car right there. >> what is that? >> a mercedes s-class. >> that's a brand-new design? >> brand-new design. these are examples of the german premium luxury that's booming around the world. everything earlier on your show was woe is europe. bright spot is german premium luxury. audi, bmw, mercedes-benz they're all selling -- >> you talk about the bifurcated economy all the time. this is not helping. >> how much do these cars cost? >> well, you -- from this the new gla, a new small port

utility from mercedes is just over $30,000. they have an all-new c-class which evokes the new s-class both from a design point of view, and from a technology point of view. and the pinnacle is the new mercedes-benz s-class which joe i could see you- >> here's the point. you're going to talk to yellen, we teased it. there's a lot of people that say that the fed has caused this, people that own assets to become very wealthy. are you going to tell her to stay as dovish as she is? is that your view? >> no, you know that's not my view joe. >> it helps auto sales, doesn't it? >> i don't care. you have to -- >> you love cash for clunkers -- >> that is not true. let's get the facts straight here. >> all right. >> rates are going to increase next year. i think this economy is growing at 3%. with 200,000 jobs a month. >> so you'd be -- >> and i would rather see rates go up early and gradual than late and fast.

>> that's an important distinction, too. when rates go up very rapidly it's problematic. >> early and gradual rather than late and rapid. >> mike -- >> i just have a quick car question. >> yes. >> none of these are hybrids. and there's a report on the "l.a. times" today that says that electric cars have flat-lined. >> it's true. >> what happened? >> all the manufacturers -- there will be hybrid versions of these cars. all the manufacturers are all three hybrids. but the fact of the matter is hybrids and electrics are stuck at 3.5% of the u.s. market. >> and that's -- >> and despite the fact that the offerings from the manufactures decreased dramatically -- >> you don't even have a car. you're not in the 3.5%. >> but i'm curious. >> ironically, andrew, a big part of that is because the fuel economy of everything else has improved so much. >> got it. >> there was another story that suggested that consumers aren't willing to pay quite as much. that the prices have gone up,

you've had to discount them. is that true? have you seen that in your dealerships? >> well the transaction costs have gone up because consumers have moved towards trucks and premium luxury. >> mike -- >> discounts have gone up in august because it's end of model year and if you want to clear the decks, now is the time to do it. >> what happens when they pull all the government subsidies for this stuff? we'll see if they could really compete. >> i think tesla would be very impressive if they could sell cars without the subsidies. >> but they don't use dealers either. >> thank you very much. when we come back we've got ben mezrich on the future of media. back in just a moment. yeah, i'm married. does it matter?

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welcome back to "squawk box," everybody. here are some of the other stories front and center this morning. shares of apple trading lower again. stock dropping more than 4% yesterday, that was its first day in seven months. more than $26 billion shaved from the market capitalization in just one sessions. tells you something about how big the market cap of that company actually is. also embattled malaysia airlines is rethinking a promotion to ask

people to name countries on their bucket list. acknowledging that the marketing was inappropriate after two deadly disasters it suffered this year. >> workers from mcdonald's, burger king and other chains planning to protest today across the nation for higher wages. nbc's craig melvin joins us now. he's at the mcdonald's on west 42nd street in new york. right across the river from -- no, wait a minute. we're here. craig! craig, tell us. >> hey, joe, how are you? good to see you? here are the workers behind me. they just made a loop around the block. i'd say maybe about 300 or so workers, not all fast food workers. had the opportunity to talk to a member of the -- some local politicians, of course. also, just some regular people i guess decided to stop and be a part of the movement. but as you know, if you guys have been reporting, this has been something going on for the better part of two years now.

fast food workers occasionally walking out, protesting for higher wages. the protesters here you can probably see them with the signs, they want $15. they want a $15 nip wage. they also want the right to unionize, as well. so we've seen these protests play out over the past few years or so. what we have been told is that today it's going to be different. in addition to the protest being in dozens of cities, roughly 150 cities we're told, atlanta, chicago, new york, los angeles, in addition to the sheer number of them we're also told you can expect some civil disobedience, we can expect some arrests. we're told by organizers that's actually one of the goals today is to have some folks get arrested to raise even more awareness for the minimum wage issue. the liveable wage issue as they would say. meanwhile the folks who walked out from mcdonald's, we don't have a hard number on the number of people who walked out. we do, however, have a statement from mcdonald's. i want to read the statement to

you in part from mcdonald's. mcdonald's and our independent franchisees support paying our valued employees fair wages aligned with the keltive marketplace. we believe that any minimum wage increase should be implemented over time. again that statement from mcdonald's. as you can see, the protests, the rally here, just getting started. >> thank you for that report. we're going to talk a little bit about media this morning. the battle for viewers and dollars is now hotter than ever. tonight on nbc a new nfl season is kicking off. the fall tv shows also starting to hit the airwaves very soon too. and thanks to streaming, binge viewing has us all devouring content at unprecedented pace, and for a lot of big dollars. netflix says they're going to be spending $3 billion this year on original content and more than $6 billion over the next three years. amazon will shell out about $1 billion for this year's new shows. and a&e reportedly about to fork over $250 million for a 10% chunk of upstart vice media as

hollywood licking its wounds after its worst summer at the box office here in the states in almost two decades. so where are the dollars flowing in the new media world and how do we make sense of future now. tom warner chairman of the boston red sox and co-founder and partner of production company carson warner and of course the executive producer of the cosby show, roseanne, among others. runner-up to be the commissioner of baseball. talk about mork and mindy. the history is long and large. our other guest host this morning is ben mezrich the author of the new book "seven wonders" which is a product of a partnership with a famed film director brett ratner. the corresponding film starts shooting shortly and there's an interesting story behind that project as well. >> and it's fiction because we think of him as -- >> i haven't done one of these in a long time. >> it sounds cool. and brett sort of inspired you -- >> yeah the book came about, i was on the phone with ratner who

was a producer on 21 and he said do you know anything about the seven wonders of the world? because if you could come up with a book i could make a very big movie. and i had always been obsessed with ancient cultures and that's where it started. it became a thriller. >> you sold it as a film first? >> it's a trilogy of films this is the first with fox. sold it as a film and a book at the same time. >> it's an indiana jones type character? >> an anthropologist -- >> is brett playing the india jones -- >> brett and i are -- >> did he cost himself. >> and tom. >> help explain this stuff. you live in a world where on tv you do a show on a network, try to do it for three, four, five seasons and then you get into massive syndication business if you can get there. >> yeah. >> now we just saw a deal, seen now several deals where companies like netflix are showing up to the door, literally before a show is even created in the case of gotham, blacklist, nbc just sold that. how is that changing the dynamic

of what gets produced and the economics of it for the long term. >> well from a producer standpoint it's another golden age. when you have $3 billion for netflix original programming, and you think about when i was producing shows there were four networks and fox was an upstart network. now you just have an explosion of opportunities to -- and everything, you know, we use the word disruptive, you use the word disruptive, the fact is that cable was disruptive of broadcast and now you have this digital content that producers are flocking to. but in the end i think we study the fact that more hours are being watched by the average viewer than everybody before. the demand is continuing to grow and our job and ben's job as a producer is just to find something that lights up -- >> it seems like there's more money in the business. just going towards content creators generally. however, i wonder if the model is now different in that you can't shoot for the moon the same way you could with the cosby show. meaning if netflix shows up and

buys the rights early, even though they're paying a lot, i can't imagine they're paying as much as you'd make on the back end of a different type of syndication deal in the old days. >> obviously it's harder to be independent. because the people who are -- who are the big boys, or acquiring the world. but you know, look at the stock value of time warner, and news corp., and so you have to obviously be partnered with these big companies. but, and you know you just talked about the summer that the box office is down, you know, i think it's down 15%. but on the other hand, if you're the producer of neighbors, the seth rogen movie, you are able to find your niche through there and i -- >> syndication i we were having this discussion yesterday and it was almost people were kind of pining for those days. those days, those seems like the stone age to do it that way, doesn't it? i mean it seems like buying a record in a record store or something with the way that things are distributed.

there will never be the syndication model again. but a lot of actors liked it, right? >> oh, sure. >> you get to like six seasons or something. >> you have to get to 100 episodes. so people are consuming things differently. >> right. >> obviously. and they're watching their television shows while they're holding a second device. but, still, they're watching shows. >> is it still a place -- >> if there were four big networks before and that was the big deal now you're looking at netflix and potentially amazon is it even harder or is it better because you have -- >> my question to you also is premium cable and cable the quality seems to be going up and up every year, can networks have that kind of quality do you think? >> it's a challenge for networks. and of course on premium cable, you have a show coming out on starz next month what is -- >> survivor's -- >> what's great about it is they give you the license, lebron james, manufacture rick carter and i came in and talked to them about an idea, and immediately they went to script and from there they went to six episodes.

so that's a very different model than the broadcast modded. it's very attractive for producers. >> as a content guy and also given the sports rights issues, what do you make of all the consolidation on the pipe side parent company of this network comcast merging with time warner cable you have at&t buying directv do you have a view on that? >> just that it's going to continue to consolidate. >> and can sports prices continue to rise? >> well part of the reason the sports prices continue to rise is they are dvr proof. we see that many of the entertainment shows people time shift and they watch it on their own time and they're fast-forwarding through commercials. nobody watches that -- nobody watches sports later. they watch it live. and so there's a real value in sports and sports -- >> went from dvr'ing things to going to on demand on comcast and you can't -- i'm back to watching commercials. >> me, too. >> they found a way of getting me -- >> i've watched more commercials than i've watched in the last five years. >> puts pressure then on the people who produce those

commercials to make them entertaining. >> wow. >> and in terms of the game of baseball, do you see changes coming to make baseball more modern, i guess? >> well, i think part of what i was saying to andrew before is part of our -- my platform was you have to look at baseball as a brand, as well. that we're at a crossroads. you can go in one direction, you could be kodak you know, which is a you know, when i grew up kodak was the you know mom and apple pie or you could be disney. and the way that disney has been so relevant and compelling is they're not just snow white and they're not just cinderella, they're pixar and marvel and star wars and so they've continued to be relevant to a new generation of consumers. >> red sox? red sox won last night. >> no, we lost. >> you lost -- >> but i -- >> just being in new york is you know keeps away -- >> so tonight is jeter's -- well you have -- >> last -- >> yankees -- >> will be at fenway park on

september 2th. you're all invited. >> what are you going to do? >> you know, we're working on it. >> did raise an interesting point local markets i see how you know i would still watch the reds if i was in cincinnati, obviously. but the big event is still the series, and the playoffs, it almost reminds me of march madness in a way. through the rest of the year, baseball isn't it sort of not everyone's watching 160 -- >> that's why we need to address the speed of play. it's something that we're talking about. next season i think you'll make some changes -- >> by the way there are rules that are in place that need to be enforced. the batter should keep one foot in the batter's box. pitcher should throw within a period of seconds. so i'm for a shot clock actually. a pitch clock. because we did in the nba in 1954, and nobody's looked back. >> where are you on soccer? given the success -- >> we own the liverpool football club. >> no, i know. but in terms of where it's going to go in the united states. >> it's only going to continue to increase. it's a terrific game.

you know the power of soccer globally. >> how big does it ever get here? people are saying it's going to get big here forever. people think we have a tipping point with this last world cup. >> i think we did. in fact it was a it took a bite out of baseball because june and july are usually baseball months and people were consumed by the world cup. i think that the speed of the play is something that makes it very attractive. you sit down. you watch the game, you're doing something else in two hours. >> okay. >> and how long until we win the world cup? >> a little longer. at least two more years. >> when does your show start? >> starts october 4th. i'm excited about it. >> well congratulations on that. we will look for that survivor's remorse on starz. chris albrecht. >> chris albrecht. starz is a great competitor to hbo. stock price has doubled in the last year. >> tom, thank you. ben's going to be sticking around. coming up, mario draghi's plan to save the european economy. a key decision on interest rates. we're going to get that next. and then bon appetit.

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welcome back, everybody. we do have some breaking news for you. the ecb rate decision is out and they're actually cutting rates. they're cutting the refi rate to 0.5% from 0.15%. also cutting the deposit rate to 0.2% from negative 0.1%. steve liesman is here. >> this is a bit of a surprise -- >> oh, my god what do they know? you would hope this would be positive. but oh, no what do they know? worse than we thought? >> first of all you've got to remember the context. draghi comes out, says even more so we'll do whatever it takes in jackson hole. and i had some background conversations with ecb officials, and i don't think i'm violating any confidence when i say qe is on the brain, draghi said as much. >> yeah. >> but they have a lot of other stuff that they have in train here. they're going to be doing the asset backed securities purchase. that's in the work. they hired blackrock to do that. the second thing they're doing is these long-term targeted

refinance operations. those are going to -- and now they're doing more on the rate that i think this is a bit of a surprise. there's some speculation. i think the market was probably 50/50 on this. the refi rate down to 0.05 down from 0.15. and mine us 0.2 to minus 0. -- >> so now what's happening here is you could argue that the europeans are finally catching a break here from the fed. because one of the conversations that's out there is how every time europe was trying to do something to get the euro lower, the fed would do something more to get the dollar lower. >> yes. >> so it was this race to the bottom, or what one treasury secretary called the losing the pageant for the world's ugliest -- >> we talked about that at the top of the show. that we always were once we they do something and we'd be even more -- >> so now it looks like the big theme here right is the idea that we're going separate ways

and the question is whether or not that can last. european economy weakening. u.s. economy strengthening. european monetary policy going to get easier. and maybe some form of quantitative easing. don't get confused. abs and ltro they're not qe. qe are separate initials. and when if the ecb does qe you will know it it won't be a back sneak door. >> would you expect to see something like that with the comments later today, if they get rate cuts like this do they wait and see what this does? >> i don't expect it today but you're right becky in the sense that it would come in the press conference not in the statement. >> is it possible that we could like this over here, our markets? but maybe over in europe they take it as a negative because things are worse than we thought? >> a different -- there's also a different political -- >> joe you're 100% right in the sense that always -- you do this all the time, not just what the ecb does but the signal from it. and that's something that any

central bank anywhere around the world is aware of that when it does something like this you get the possibility that it's worse. i don't know that there's any new information. we know german gdp was down 0.2% in the second quarter while u.s. growth was -- >> some preemptive -- >> the whole ukraine concept that that's going to hurt europe all that's out there. i don't know that there's any new information here but what we do know is they have the abs and the ltro on top i don't think a qe announcement would come until sometime they get those things working first, and see how those increase the balance. >> which there's an argument to be said let's see how this work and go with it. but that's been europe's problem. wouldn't there be something to say load up the bazooka, shoot it all and see what you can get with it? >> as you know, becky, any time it comes to europe it's complicated. we think things are tough here? they have to get all these member countries on board. and then they got the germans who hate the idea of doing qe, but i will tell you, that the

leadership at the ecb now thinks they have the right to buy the sovereign bonds. while some argue that's not in their charter, they think they have the right to do it in the secondary market. and i think one of the things we know from draghi is he will do it, if he feels like he hassed consensus behind him and "b" so this -- >> i should also say is there's another head line i can't see the bonds themselves but says the eurozone government bond yields fall sharply which is what you might anticipate if you think they are going to be buying european sovereign bonds. >> this is what complicates it. there's a couple things out there what the economists at the ecb want to understand is, why would qe do any good in a world where the german bund is trading what is it now -- >> below 1%. >> so why would that help? unless, as you argue, it's in anticipation if he doesn't do it then they rise. the other question is, we know the european balance sheet fell. and it fell pretty sharply. and growth fell along with it.

but, neither the american nor the european economists really understand the connection between the declining balance sheet and declining growth. it may have been just coincidental. we know that in america, we loaded up on the balance sheet. and we had growth. it wasn't fantastic growth but it was certainly better than either japan or europe had. >> okay. steve thank you very much. >> 8:30 is now a bigger deal. and 8:15 we'll be back with the adp and i'm just really excited to be here. this is amaze pg. it's like a new show. >> i know. >> i just got the big wrap. it's like the same show. >> there on -- >> thanks matt. >> they're on tenterhooks. there's radio city music -- >> this is awesome. >> read. go. >> okay. up next one of america's hottest chefs is making comfort food hip. april bloomfield's recipe for making a great restaurant. and still to come, market moving just heard about it jobs data the tap employment report and media reaction from mark zandi of moody's.

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welcome back to "squawk box." april bloomfield is the chef and business mind behind some of nyc's trendiest restaurants and she's now adding california her menu turning a dive bar in san francisco into an upscale tuscan

eatery called tosca. bon appetit their top ten best new restaurant lists. she's here now to show us how she's taking comfort food to the next level and walk us through the future of the food business. also joining us is adam rapport the editor in chief of bon appetit magazine. thank you guys for being here. tell us about the business decision to go do this in san francisco. >> me and ken friedman my business partner are big fans of san francisco. i worked at chez panisse and we drank in tosca which was basically a dive bar. it was an old institution and we decided that we loved it. you know we had it came up for sale and we just kind of both felt the need and want to do it and kind of keep this, you know, old bar alive. >> it smells wonderful. you brought some food. i can smell it from here. it smells like comfort food. >> good. it's an amazing place.

it's got good bones. it's moody. it's rich. it's vibrant. >> adam, how do you actually pick them? >> well, a restaurant critic andrew notten spends probably about four months going every week, every weekend traveling the country, somehow he ends up not getting divorced by the time he gets home, and he literally has about 250 meals. >> does this surprise people. >> every year, he has a -- a -- a nome deplume of sorts. this year was his porn name if you will. his street that he grew up on and his -- >> miles long? >> so this was bo dunwoody. >> that's a rich -- >> these are his streets. >> his street and his pet. >> his street and his pet. >> that is one hell of a porn name. >> pricepoint? >> it's midrange, about $70 -- >> what do you make of this trend of reservations, people paying for reservations. >> i think that's kind of weird myself.

but we've only just started taking reservations, actually, tosca is our first place we are taking reservation. >> open table or not? >> open table. >> thank you for being here. >> thank you. >> any tacos? >> no i didn't bring the tacos. but delicious chicken. >> we're going to have a little dinner breakfast in just a moment. >> there it is. >> we've got a big hour of "squawk" still to come from new york city this morning. tap jobs data, mario draghi has the news conference and a big bucket of data at 8:30 a.m. this is a burrito made with chocolate, soybeans, and apricots. what kind of chef comes up with this? a chef working with ibm watson, on the cloud. ingredients are just data. watson turns big data into new ideas. and not just for food. watson is working with doctors and bankers to help transform their industries. today there's a new way to work.

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breaking news on tap. first up the adp private jobs data. numbers and market reaction are just minutes away. plus is qe coming to europe? ecb president mario draghi ready to kick off a news conference that some say could be his most important as president of the ecb. tensions flaring around the world. but so far oil and gold aren't spiking. we'll find out why with one of the most important commodities gurus on wall street. >> and it's not rush hour in the city just yet. but it is rush hour on the "squawk" set.

>> director and producer and i dare say hollywood bad boy brett ratner joins guest host and author ben mezrich as the final hour of "squawk box" begins right now. >> welcome back to "squawk box" here on cnbc. first in business worldwide i'm joe kernen along with becky quick and andrew ross sorkin. a new ad campaign taking a page from apple's playbook. see if you can guess what product this ad is for. >> you know, once in awhile, something comes along that changes the way we live. a device so simple and intuitive, you see it -- >> it was the move of "squawk box" in new york city is what they're -- >> it's not a parody. there's a lot of parodies out there on apple. >> yes, there are. a lot of very similar things.

>> we will show you more of this apple inspired ad and reveal the company behind it later in this show. but first, andrew has this morning's headlines from sixth avenue and 51st street across from where the rockettes are. that's called radio -- oh, is it -- i thought it said -- okay you do it, becky. >> just a few of the headlines from right here in new york city. at this hour the ecb grabbing the attention of the global markets. we were all surprised by this. the central bank coming out with a rate cut that actually has moved the markets. lowering things, if you check out what's been happening with the euro you'll see that it is now at a one-year low sitting just at 1:30. 1:3034 the futures moved on some of this activity. the futures are indicated higher up by about 36 points. we were there beforehand. we did see the futures move up to about 55 or 56 points above fair value. now up about 35 points. this story could get even more interesting in just about 30 minutes when mario draghi is

going to be holding a news conference and possibly offer clues on what the bank might do in addition to these rate cuts if there's anything else to come. we also have adp that's coming out in just about 15 minutes. >> oil prices down nearly 10% since july 1st while gold prices are down nearly 25% over the last two years. all this despite crumbling countries in the middle east. beheadings, the makings of a new cold war in russia. joining us on a rare, exclusive, is jeffrey curry goldman sach's global head of commodities research and cnbc's kate kelly. when the fed is on the other end of the tightening cycle and we pass the inflection point gold is not going higher. isn't it that simple? >> well, you know, gold is being caught between three different dynamics. one is obviously the russia ukraine event putting upward pressure on it. the second is weakness in europe and japan has created an influent to u.s. treasuries which has put downward pressure

on interest rates and upward pressure on gold prices. as you point out ultimately gold is a hedge against debasement in u.s. dollar. so fed's actions should be dominant here which is what we actually see why gold is down. year-to-date. our target on the end of this year is 1050 really driven by the view that we think that the fed is going to be the dominant force here and put more -- >> 1050. that's a long way to fall. >> we've fallen if you go back over the past year we were at nearly 1800 at the beginning of 2013, and we're roughly 1250 in the current environment. >> it's no coincidence that oil can't get out of its own. it's in a trading range with every oil related hot spot in the world in total chaos and that's what's keeping it from dropping below 90. right? >> yeah, but when we look at oil i think there's two dynamics there that have created a, you know, a lack of volatility. you know, one is obviously the macro environment with, you know, the fed having tamed volatility across most assets. the other dynamic is when you look at the supply curve for oil, it is much flatter than

what it used to be historically given the advent of the shale production. >> right this is because of u.s. oil or energy independence really. right the shale oil production being more efficient. >> i have to say shale has turned oil into a manufacturing process. in the old days you go out, and you build a deepwater offshore platform, take ten years to build it and produce for the next 20 years and you couldn't control the output. today, the shale production is like turning a knob up and down. it can respond to prices almost immediately. >> aren't all the big money guys back in stocks instead of oil? weren't they in oil three and four years ago? now they're back in stocks. there's none of the big investment types in oil. there's no money made. >> well where we are in the business cycle, commodities are very typically, you know, benign is a term i actually like to use. they don't perform until you get to the end of the business cycle. when inflationary pressures begin to put tightened markets, and you take the output gap out and take the slack out of the markets. so we're far from that point at this point in time.

historically equities perform well given this time and we don't expect them to start to -- commodities perform until you get to the end -- >> let's go back to geopolitics. there's so many hot spots in the world right now. certainly russia ukraine dominating the news, russia being such an important player in both natural gas and crude why are we not seeing more of a move? why is crude trading predominantly on u.s. supply and perhaps a little bit of softening demand in the u.s. and europe? >> i think when you look at, you know, you know, the wheat i think illustrates this point. wheat has the potential to have a very large disruption given what's happening in both russia and ukraine. it's up substantially. >> right. >> for the markets to have a probability of having a disruption aren't moving. oil on the other hand, if we look back in history what are the probabilities of seeing a significant disruption? incredibly low. >> what is the historical precedent for geopolitics actually moving the market? is it less frequent than we think? >> far less frequent. you look at it there's only three significant events. the arab oil embargo in '73, '74

led to a decision. the next one was the iranian revolution in 1978. also led to the 80-81 recession and the last one would have been the iraqi invasion of kuwait led to a recession in '91. they're relatively rare events that lead to a significant disruption in economic activity hence why financial markets and oil really aren't reacting to this. >> if isis spreads we did have dan senor on earlier his suggestion is that isis could spread very quickly into other countries would that be a tipping point? >> it could be a tipping point. you know, but the key there really is the southern part of iraq and the basra fields, and getting down there is a relatively low probability event. i think you'd have to see that happen before you would really start to think there's a lot of upward pressure in oil. >> do you remember around 2005 goldman sachs and equities analysts issued the superspike report predicts that oil which was then -- >> it was all the way back in 2005? >> yes. >> was $300. >> maybe go up to $105 and that

was a huge shock. now oil is at $105 and we're talking about how weak that is. >> there was a 300 report that -- >> no, no, i wouldn't go that far. >> at one point -- >> nobody ever went 300. >> can i ask my favorite question relates to gold but it's not. -- bitcoin? >> you look at bitcoin the real issue is, does it solve an economic problem that is similar to let's say like i use the analogy of when coal replaced wood. reason why coal replaced wood was because it could make the steam engines go further and faster. can bitcoin do the same thing to the current financial system with credit cards and so forth? the answer is no. and actually the one interesting thing in bringing it back to commodities that when you look at you know, the point about bitcoin that is brought up over and over is it's very difficult to counterfeit. actually, in looking at it, gold, too, extremely difficult to counterfeit. and the reason why, it's the

second most dense element on the planet earth. platinum being the most dense. there's other more dense ones but they're nuclear and you know you'd probably get radiation if you actually dealt with them so avoiding the radiation is gold and platinum. and with that density, you can't blend it with anything to come up with something that is counterfeitable. so i actually still like gold better than bitcoin. >> jeff real quick gsci or commodities indices in general you like them right now? >> we like it from a strategic perspective but not from a tactical perspective. what do i mean by that? our outlook is relatively besnien on commodities. however, when you look underneath the hood of the benign outlook there's a couple of dynamics going on. one is dispersion across commodities. i call it like a stock picking environment. you have, you know, right now we want to be long nickel. palladium. nickel and palladium are the best hedges against what's going on in russia because it represents a largest share of all commodity production coming

out of russia. zing, aluminum and then turning the ones we want to be short. gold, copper, so there's interesting stories underneath this benign outlook. the other point is there's a positive role. meaning that when you look at commodity prices they're down 4% year to date, however when you look at the returns from an investor in commodities they're only down 1.5%. because the positive role yield meaning you buy out on the forward curve at discounted prices roll up has created a 2.5% -- >> you can do a time curve arbitrage that makes money -- >> slightly. >> the other reason we want to hold commodities is diversifying asset, and then a hedge against hostile markets. let's say something does happen in the middle east or something like that that creates a substantial price spike in oil holding commodities will definitely act as a device -- >> goldman was pretty -- was $200. and at the same conference matt simmons the late matt simmons said 300. so -- >> that was 2008. that's what --

>> but gold -- >> someone said 300. goldman sachs was at 200. but didn't get to 200 or 300. >> how did he figure on the 200? >> well basically they went back and looked at historically what price level did it require to there's a the energy as a percentage of gdp equal what it did in 1973 and 1978. >> okay. >> but that was a superspike looking at where the top could be and how they valued equities our official forecast during that time period was 1047.50. >> can you get a decent suit for $1050? >> we hope so. >> okay. >> because that's how gold, a decent suit. >> i can't get a decent -- >> four or five of them for that. you wouldn't, but your tom ford suits what do those things cost? >> not one of andrew's suits. or robert -- >> that's what i mean. >> jeff, thank you for coming in. >> you need like -- >> you need a bar. like an ingot for one of those suits. >> kate good to see you. >> thank you kate. up next -- appreciate it.

hold on. numbers that could move the markets today and another piece of jobs puzzle. later probably the most important news conference so far for the i with serious market implications. monitoring what mr. draghi says about the state of the european economy and listening closely for hints of qe over there. kid: hey dad, who was that man? dad: he's our broker. he helps looks after all our money. kid: do you pay him? dad: of course. kid: how much? dad: i don't know exactly.

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rising by 204,000. a bit light of the estimate which is 215,000. july was revised lower down by 6,000 to 212,000. goods producing up 41,000. services up 164,000. the payroll estimate for tomorrow, it's tomorrow, right? because we're doing it thursday this morning. >> -- because of labor day right? >> 225,000 is the estimate for tomorrow. so, this is maybe a bit light but would be i believe the seventh month in a row that would be above 200,000. pretty good string with the big question being how much slack is out in the labor markets and

what the quality of the jobs being produced, the quality is, what the quality is. well joining us from washington, a guy who knows a lot about the economy, a lot about grammar, mark zandi chief economist at moody's analytics. mark, let's go right to what kind of jobs were created in the month here. i see construction up 15,000. are these good quality jobs in your opinion? >> i think they're across the board, steve. every industry is adding to payrolls, jobs, at every company size is -- are increasing. you know if you bring in other data i think the evidence suggests that we're getting job growth of obviously low paying jobs in retail. these are hospitality but high-paying jobs in technology, resources, resource in mining. even construction are high paying jobs. and now even middle paying jobs because we're starting to see some employment growth in the government sector. so it's broad-based. and that's the best news about the job market. >> so i want to pick right up on

what you said. so that 204 which we get the private sector number from you guys and economists used to subtract for government employment decline now you're saying government's adding to jobs so it's 204 plus, not 204 minus now you think. >> yeah, so the average monthly job growth in government now is probably 5 to 10 k per month. federal government is still laying off but state and local is adding and so if you take -- if you want to take a good estimate of tomorrow's payroll number it would be 204 plus 510 so 210, 215. >> economists use this as a guide when it's big one way or the other they'll shift but this number relative to the estimate i don't expect economists to change their forecast for tomorrow. you said job growth in all kinds of businesses. and i see that small business, up by nearly 80,000. that was a big weakness in the economy. has that turned around as well, mark? >> yeah, completely. the small businesses are most tied in to the housing and

construction cycle more broadly. and since the turn in the housing market which is two, two and a half years ago, that's really resulted in a lot more jobs in smaller businesses. and that's gaining momentum. so, we are seeing job growth everywhere from the largest companies, 1,000 plus employees to the smallest companies with less than 20 employees. >> mark, you can't tell i want to get to something in a second but you can't tell these part-time jobs or full-time jobs that you're reporting there. >> not in this data, no. we don't know that. if you look at the bls data the number we'll get tomorrow, there are no evidence in that that there's a preponderance share of the job creation in part-time. it's pretty broad-based. distributed in a broad-based way. there are a lot of part timers out there working part-time for what is called economic reasons. they'd rather work full-time. >> right. >> and that's part of the, you know, the slack in the labor market that you mentioned earlier in the conversation. we have to absorb that.

but you know, i don't think that job growth we're seeing is more part-time or full-time. it's pretty evenly distributed. >> big news of the morning, ecb cutting rates. were you surprised by that? what do you expect to hear from mario draghi in less than 12 minutes now. >> i wasn't surprised. i think he signaled that at the jackson hole meeting where he gave that speech pretty much signaling he was going to do something. i think what he's trying to do, the key thing for the ecb is the targeted ltros, that's providing cheap money to the european banks so they can go out and extend more credit. the big problem in europe is the banks are cutting credit not extending credit. so by lowering interest rates it makes it the targeted ltros more effective. and so -- and that's what he's trying to set up. i think we'll get more granularity with respect to his thinking on that when he does have his press conference. >> can you explain what a negative deposit rate means? i think that's so outside of most people's understanding of

banking. and most people have sort of the a cursory understanding of banking. what does a negative deposit rate mean? >> if the banks have deposits on hand they're not getting an interest rate on it, they're paying. so it's trying to create some pain in the banking system to make the banks go out and extend out more loans and use those excess reserves deposits they have on their balance sheets. >> by lowering that, it was already negative by kind of doubling the amount that they have to pay on it do you think that's an effective tool? >> great question. i'm not sure. i think this is an experiment. we've only gone down this path in a couple countries historically and it didn't seem, you know, at the end of the day didn't seem to make a large difference one way or the other. but you know, in the case of the ecb and europe they're running out of options. so i think they're going down a very unproven path. we'll have to see how it works. >> mark, thanks for joining us this morning. >> thank you. >> steve, thank you. we will see you again in just a few minutes. >> zandi on testimony? >> yeah. >> big jobs report tomorrow

we'll see mark again tomorrow. we'll see steve again in just a few minutes because we do have more numbers to watch. when we come back the closely watched weekly jobless claims at 8:30. then we are in new york but we have a hollywood on the brain today. producer and director brett ratner will join us on the future of film making. "squawk box" will be right back. your fidelity green line t and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy to move that old 401(k) to a fidelity rollover ira.

tesla bedding on nevada for its new factory. phil lebeau joins us now with more this morning. phil? >> good morning, andrew. from carson city, where later today the governor of nevada, along with tesla ceo elon musk will make the announcement that nevada is the first state that will have a tesla giga factory. here's what we know about what will be announced later today here in nevada. this is the first site for a tesla gigafactory. that's the expected announcement. we say the first day because tesla has indicated there could be more than one gigafactory site. we expect some clarification on if there will be other locations. that might come later today. and remember this is a huge, huge investment. the gigafactory could bring up to 6500 jobs. earlier this summer on cnbc, tesla ceo elon musk talked about the importance of getting the giga factory up and running. at least by 2017. >> people think like oh, we're

just trying to put the screws to various states to get the most incentive -- you know, as much inseine five as possible. i guess it does but that's actually not our goal. really our main concern is to make sure that the gigafactory. the giant factory is ready when the third generation car is ready. because if we go and design the car, and we tool up to produce the rest of the car, which is also a big expense, but then there are no factories to supply it it would be a terrible outcome for tesla. we might fail as a company. so that has to be paramount in our decision making. >> and make no mistake the gigafactory is critical to the future success for tesla. it will produce up to 500,000 battery packs a year by the end of this decade. again, it is scheduled to open by 2017 which would coincide with the launch of its mass market model 3 electric vehicle. and right now tesla is on track

to deliver at least 35,000 vehicles this year, some are saying it could be closer to 40,000. and by the end of 2015, tesla expects the pace of production to be 100,000 vehicles. that's some of the optimism that's out there on wall street regarding this stock. it's up 65% this year. guys we're going to be here all day long and of course we'll be here to talk about elon musk after the announcement later today. back to you. >> all right, phil, thank you very much. again, phil lebeau. when we come back on "squawk box" we are just minutes away from the closely watched jobless claims. plus ecb president mario draghi set to begin his news conference. we will bring you the details all the things that he's saying and the impact that has on the markets, as well. "squawk box" live in new york, will be back after a quick break. when change is in the air you see things in a whole new way. it's in this spirit that ing u.s. is becoming a new kind of company.

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welcome back to "squawk box," everyone. this is a big morning. ecb surprisingly cut rates this morning. take a look and see what's been happening with the futures since then. the futures have moved but more importantly where we've really seen movement has been in the euro. euro dropped significantly on this news because it was a surprise. we're waiting to hear what mario draghi has to say in just a few moments. that could have a bigger impact on what's been happening. european stock markets there have been up by about 1%.

again the euro is where you've seen a lot of the action on all of this. right now, we do have a number of data points that are ready to hit the wires. jobless claims and productivity both coming out. mario draghi talking in just a few seconds but we have our crack team here to wrap up everything and bring you it as it happens. rick santelli, take it away. the july trade balance is 40.5 billion. actually lighter than expected. that's good news. last month revised to 40.8. jobless claims moved from an unrevised 298 up a whopping 4,000 to 302,000. these numbers for initial claims really like kissing your cousin in terms of they're low. how much is that going to give you insight into jobs, part time, full time, not much. the market would be more excited if it jumped over 325,000, 330,000. continuing claims whoever at

2.46 million. and second quarter, what is this the final? yeah, second quarterfinal, productivity, and this is the important number. 2.3. it's a little light. productivity is the magic bullet and it's eluded us for quite some time. we are definitely underperforming and lost productivity as japan learned is tough to get back. this full beurre isn't so bad up at 2.3. unit labor costs didn't have a big move. they were down 0.1. many expecting up a bit so it kind of does fit. last month was up 0.6. so you could see that there has been improvement on unit labor costs. but of course, many of you that are unemployed or underemployed or looking for work, watching record corporate profits and record levels of stock prices probably would like to be a bigger place on many clients or highers, balance sheets. we all know that the human capital is probably one of the biggest costs for business. the euro really getting crushed. intraday getting to levels we haven't seen since july of 2013.

obviously the more negative the the ecb goes they think maybe that's more positive for the market. many would have doubts including the st. louis fed who has written a very interesting paper that maybe the problem we see coming are central bankers. >> i do want to hear more of your thoughts. i see a couple of notes circulating that the euro is primed for a bounceback after this big pressure this morning. but, if we hear more from mario draghi, that might not be the situation. what do you think? >> well, i have my doubts as to the type and breadth of qe that they will be able to pull off. i have my doubts about programs they have highlighted and paid for assetback purchase program. i don't know if they're going to have a pool big enough to make a difference. we'll have to see. i think qe in europe is going to be a dicey situation and i know that we had jim o'neil on good morninger goldman head yesterday and i think he summed it up the way most see it.

that with regard to interest rates, lower interest rates aren't going to really help anybody. they haven't really helped. they're not even helping housing here at this point. but it's about reflate or die. it's about inflation, all this debt out there has to be serviced at lower rates. will they be successful creating faux inflation? seems the market's pretty smart. doesn't seem to be coming through. >> let's get straight to michelle caruso-cabrera. she's in milan right now. michelle? >> sounds like we have a problem with our connection with michelle. we are seeing the headlines that are coming through. it looks like they are going to be doing things. new -- >> he's formally announcing these asset backed security purchases and a range of new measures will purchase covered bonds, and all these things that begin in october 2014. draghi saying significant difference between the major economies and they've made a decision to add to a range of recent policy measures. and the new measures are to the

with the targeted ltros, which we discussed. and he's saying they're going to have a sizable impact on the balance sheet. so kind of a little bit of new rhetoric in terms of adding to the balance sheet now. >> not specifics that i see at this point in terms of the numbers. >> no -- >> i don't -- >> i don't have the number. >> but i do want to take a look. >> i was given a number before which is something like 400 -- they expect in the first by the end of this year they could increase the balance sheet by 400 billion. >> i think we have michelle caruso-cabrera right now. michelle you have more to add on this? >> yeah well we have been waiting for whether or not there would be a decision in order to purchase embark on some version of quantitative easing and as steve has pointed out they have decided to do so. we're waiting for what the size of the package would be. but asset backed securities and covered bonds appear to be the things that they would work on first. remember it's much more difficult for europe to do quantitative easing because they

don't have a deep securitization market like we do in the united states. and they've got many different countries where mortgages are different in every country. car loans are different in every country. so there's got to be a standardization process. mario draghi has to create a fresh capital market out of whole cloth. they're going to start with abs, asset-backed securities and common bonds which are more common here. we're waiting to hear the details. so far he managed to give the markets more than they expected. when you can see the big move in the euro which was $1.40 and now we're talking about $1.30 it's been a pretty impressive move. >> right now that euro is sitting at a 14-month low of $1.3011. it's moving below that now at we'll see if it crosses below 1.30 at this point. also want to add that the latest comment he just made is that the council, draghi saying that the council is unanimous in its commitment to using additional unconventional measures. >> emphasize that word additional >> >> additional. right. we point out how difficult it is

to get any changes through the broad number of people, fortunately we have a lot of people here to talk about this today. in fact right now we are joined by gene sperling, former director of the national economic council under president obama. and gene what do you think about what the ecb is doing right now? is this the right moves? is it too little, too late? >> look, i think that draghi has freed himself from the constraints of germany, and he i think at a personal level has decided, you know, that he's going to emulate ben bernanke in that he, whatever the criticisms are going to be it's not going to be that they didn't do enough. and i think the other similarity is that they both have a feeling, a sense that fiscal policy is not stepped up in the short run. there hasn't been enough emphasis on the kind of demand driven growth in germany there's things they could be doing with a higher minimum wage. more encouragement of their countries to increase wages. i think he's signaled he's going to do whatever is necessary.

i think the move to negative rates was obviously very significant. in terms of today's move when you're doing something like this you don't have that many bullets left. you don't have that many times you can surprise something. so if you have a little bit of a sense where you could lower rates today and add to a boom, you know, do it. you know, why not take your last chances or two to kind of surprise the market on the upside and give a little bit more boost a little bit more confidence that he's going to do whatever is necessary, and so now he's done the actions to back up his words. >> you do it but you worry about what happens on the other end. >> we all worry about what happens on the other end of this country. >> yes. but i think there's so much more fear of deflation in europe than we're facing here. i think the worries are greater. and i think they've been very slow on the growth side. it's better now. there's a little more grudging

concession from germany that we need this. but look you don't see the resistance coming to him even in germany. so even at the fiscal side where there's more resistance, i think he is feeling liberated now, and you're seeing that. >> i argue with steve all the time about -- >> lovingly. >> lovingly about the effect on savers, and the zero -- the zerp for five years, zero interest rates for such a long time and i point out what i think is incongruous for the left to be pressuring the fed to say so loose and at the same time to be crying about income inequality when a lot of that is being engendered by what the fed is doing. no one, krugman, across the line, no one wants the fed to stop with the zero interest rates yet everyone knows that the people with the assets are the ones that are benefiting. how does that work? the people that you're trying to help are being left behind. >> well i think that, again,

people feel that, and you've heard chairman yellen talk about this, we've had rourkable progress in the head line numbers, and the numbers that yellen has told us to look at. the subnumbers about how many people are working hard-time involuntarily. how many discouraged workers there are, what's the u-six the broader indexes, all of these things are getting better so everything's moving in the right direction. but what she's doing -- >> is there cause and effect from the low -- >> i think what she's saying is is that you know we're still not facing a point of slack. you know, there's still enough slack that you do not have to worry that this kind of stimulus from the fed is going to lead to inflationary pressures. i understand you're raising the other question is it asset bubbles -- >> and you saw it happen last time it burst and everybody you were trying to help was much worse off. >> i think that was driven by much more deeper things that you've written about than just the fed action. and i think in europe right now,

there's such an emphasis on growth, avoiding deflation that i think that, you know, i can only support what draghi did today. >> i hope you know i hope there is know day of reckoning. -- >> just a quick word on the u.s. data. >> it continues to improve. >> you see our jobs numbers and all of our data continuing to improve -- >> strong productivity numbers. 2.3. i just want to point out is the context of lower jobless claims being at 300,000 that tells us one side of the equation lack of firing but we know it's happening in the context of hiring and so there may be some upside in this jobs number tomorrow because one side of the equation is doing well and now the other side is doing better as well. and i think becky you were asking the right question, does it mean earlier? i think a lot of people are thinking earlier, maybe sprint. >> if you came back from mars saw where fed policy was right now given all of the economic indicators, you would be shocked

that we were still -- >> is -- >> but i really think -- >> i really think janet yellen did a beautiful job in her teach at jackson hole of explaining what she's looking at is how much slack still exists -- >> you were a trained economist would you not be shocked looking at how long -- >> i think if you look at the head line numbers they're so much better. lower unemployment. i think it's right for her to look at things like how many people are still long-term unemployed. how many people are not working full time who want to as an indication of whether expect wage pressure wage push inflation and i think she's saying she's not going to move on that until she sees more evidence of actual tightness in the labor market. >> gene thank you so much for coming in today. steve we'll see you again a lot tomorrow, too. >> coming up, producer and director brett ratner, he's going to join us on the future of film making when "squawk box" returns live from new york city. i know what my money is doing. i rebalanced my portfolio on my phone.

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all right. let's get to michelle caruso-cabrera with some of her comments on what's been actually a lot going on around the world, michelle. >> yeah, it's been in terms of all kinds of international news it's been busy lately, joe. so, mario draghi at the ecb press conference has just started taking questions. but we should underline what the world has been waiting for, at least the financial world has been waiting for was announced this morning. the european central bank will embark on quantitative easing

starting in october. they're not going to do it the same way the united states did. bernanke bought u.s. treasuries. he bought mortgage backed securities. they're going to start with asset backed skirts, and something called covered bonds. how much they're going to buy, we don't know. all draghi has said so far is we'll have a sizable impact on the balance sheet. that's a way to talk about how much stuff they're buying. we talk about the size of japanese central banks balance sheet the european central bank and the u.s. central bank. the impact on markets has been pretty dramatic this morning with the euro falling to below 1:30 at one point and european yields dropping sharply yet again. guys, back to you. >> okay. michelle, thanks for that. switch gears entirely here get back to ben and this other crazy -- it's great to have this gentleman come in. can hollywood revive the publishing industry? joining us now, director and producer and bon vivant

hollywood bad boy brett ratner, co-founder and chairman of rat pack press which is publishing guest host ben mezrich's new book "seven wonders." we couldn't introduce you really as a director, or a producer, or a publisher, or a -- i mean you're even -- you know when i spoke to you you said if my partner packer, packer is like casinos. what are you thought, ratner, at this point? what have you not got your fingers in at this point? >> i'm having a great time actually. and i'm actually so happy to be here. i just really love you because i haven't been up this early since i went to camp, since i went to camp in the third grade. actually. >> yeah, i know. and we i think last time you -- you were scheduled one other time and i think that might have been the problem, that you had just gone to bed or something. and there's no way but this time we turn the screws so much it's good to see you. it's an unbelievable story that we just heard from ben that you got the idea, and he's a great writer but i didn't think of him as a fiction writer. i mean he's -- he writes really compelling stuff about things

that maybe are not that interesting so you let him go as fiction it must be unbelievable. site was your idea. let's go -- >> well, ben's known as you know, as a narrative nonfiction writer mostly. with the social network and bringing down the house. which i end up turning into a movie called 21. so, i was in budapest shooting hercules and i get a call from ben just out of the blue and he says do you have any ideas for a book? i'm scrambling kind of looking for what my next book is going to be. and i happened to be with my producer bo flynn who had just pitched me a movie idea about the seven wonders of the world. it was just a general idea. he goes, wouldn't it be great to make a movie about the seven wonders of the world, and the connection between the seven wonders of the world. kind of an indiana jones meets da vinci code tip thriller. when i pitch this to ben, he completely went crazy and said i want to write that. and so it's kind of the opposite. i was shocked that he was even asking me for an idea.

so, i think the trend now, and ben is kind of made it possible is that an idea for a book comes from a movie idea, and then he turns it, adopts it into a novel but he actually, of course, i'm giving -- i'm taking a lot of credit but it's actually he wrote the actual original idea. we took a four-page outline that he wrote, took it to fox studios, and sold it as a major motion picture. >> yeah. really cool. i have to say when i called brett, brett's, you know, a legend in hollywood and someone who always has these incredible ideas i was excited to have an idea that wouldn't get me killed. because usually when i talk to brett it's like miami gun runners or something hoar. and i say what is the danger level and he's like maybe eight. i don't want to do that. so this was exciting. i've always been obsessed with ancient cultures and the whole idea of doing a da vinci code type of book and this was an opportunity to get inside my geeky self and go into these ancient cultures. >> now brett's in publishing. have you published other books

before this? >> i have but not in the scale. i just did -- my company rat pack entertainment which is my film company started a publishing division, and we did a joint venture with perseus which is one of the biggest book distributors in the world. so, you know, ben is a highly acclaimed author, and we wanted to make sure that we had the distribution, because his books are best-selling books. and he's a very well-known author. but this is a -- an area which he hasn't really kind of delved into in the past. but i really believe, after reading the first draft of this book, and now the book's out, i think it came out today or something. or yesterday, that this guy is a modern-day michael crichton, modern-day dan brown, you know, really for this generation. >> brett and you know, it didn't escape me that sequels, three of them, right? i mean you get one to work, that's the best formula in hollywood as you already know. >> yeah. >> the plan is to do it like an

indiana jones -- >> who, any casting done yet at all? who are you even thinking about for the indiana-type character? you got any idea? >> there's so many different great actors. we had actors. we had to cast the writer first for the book, for the adaptation, and what's great is that there's no writer faster than ben. he's committed to a book and literally, i don't know how he ever gets to spend time with his wife and child because this guy is the fastest writer i've seen. he's handing chapters over to the writer we hired or cast to write the movie version, so that's why it's a simultaneous path of developing the movie and creating the book at the same time. usually it's the opposite. >> a business question. is amazon a friend or foe of yours from a content perspective? you sell film stuff, and, by the way, i realized almost in the

big battle with amazon. >> i think amazon is definitely a friend. amazon, you know, is just an incredible brand, and i think that, you know, with book publishing, films, television shows, and networks, i mean, right now is the most exciting time in media because of the fact there's all these new outlets and new opportunities for distribution. you know, when hbo started when i was a kid, and, you know, i watched hbo, i never expected there to be a netflix. i never expected an amazon or other opportunities toed broadcast content. >> you're less happy with amazon. >> it's not that, but i think it's a necessary thing. i think publishes and amazon have to work it out. i feel like amazon is an enormous part of the market. that's how we reach people. >> brett, is there going to be a rush hour casino? what is going on with pack? work with me.

>> if i was not a film director, asked me recently, i was telling a fr a friend last night, what would you be? i'd be in the casino business. there's no business like the casino business because it's gone from being about gambling to an entertainment business, and resorts and, you know, the globalization of the resorts is exciting. packer has not only a new casino built in sidney in the harbor across from the opera house, but he's building a casino in s sri lanka, the philippines, and so many opportunities globally. when i walk -- look, what casinos are selling are adrenaline in the same way i do with people walking in the theater and same with ben's book. >> yeah, he's got it going too. the market cap of his stock doubled, and he's got 30% or

something. >> tell mim to come to atlantic city. we need help. >> yeah, we need help in atlantic city. next time you are here, it won't be -- it's three hours difference, so won't be as hard on you. >> no, i'm okay. >> you're good? haven't been to bed yet? >> no, i just got home, just got home. >> i believe it. i believe it. great. we got to run, thanks for finally coming on. >> better thanni waking up -- >> this is the only way i can see you, i guess it's the best way. >> check out seven wonders, it's a great book. >> we will, see you. >> thank, guys. >> when we come back, a check on the market, and later, joe and andrew spend time together, male bonding perhaps. we have highlights of the bromance ahead. "squawk box will be right back. when you compare the top speed of dsl from the phone company

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one that helps you think differently about what's ahead, and what's possible when you get things organized. ing u.s. is now voya. changing the way you think of retirement. we got an update on the big news. >> from the press conference, president of the ecb, qe above and beyond measure ready announce than more than discussed, potentially public and private bonds and sovereign bonds out there. this is -- the cut rate's not unanimous. >> we'll see the impact today. tomorrow, though, we'll be back

in new york for a big jobs friday and a megatailgate friday here in the heart of the new york. check it out. the ultimate tailgate machine brought to you by top shelf tailgate. this bad boy has everything needed to throw the ultimate tailgate. we have more. we'll see you tomorrow, and "squawk on the street" begins right now. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with david faber at the new york stock exchange on a morning we are going to remember. the european central bank beginning to purchase asset backed securities. futures higher here. the euro lower as draghi spopds forcefully to the slow down in europe. historic rate cut from the ecb as well, beginning of quantitative easing in europe. more from draghi