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 and slew of

numbers here tomorrow. >> apple's worse day in seven months. apple now moving higher in the premarket. >> yum sales take a hit in china after food safety scares, numbers from costco, and nevada lays out the welcome mat for musk, the $5 billion factory going to the desert. >> ecb cut interest rates to new record lows in effort to ward off deflation, lowering the rate by a tenth percent, and it's rate on bank overnight deposits to negative.2%. the president says the bank will purchase asset backed securities, and here in the states, adp says prooifts sector hired 204 thourks worker last month, below forecast, and the big jobs number, of course, tomorrow. europe is the story. for those of us not well schooled, what does this mean? >> what this says, i think, is the german hold on the european

economy, hoover style, worry about a balanced budget no matter what is broken by draghi who will take rates whatever it takes to get the economy moving. germany, exact opposite. people are quick to say negative -- listen to the commentary, well, draghi's being foolish, no, he's trying to save europe from germany, trying to be fdr when hoover rules, trying the save the year row at the same time, and we're the collateral gainer. our commodities go down in price because of the dollar. our exporters hurt, of course, but interest rates stay low. don't forget, france has 1.3% tenure. that money's going to come here. i like the idea of the stronger dollar, nothing wrong with that. it's not bad to have a strong dollar. this is not bad for us. >> to those who figured -- and a lot was expected abs purchases,

covered bond purchase, not so much, cut in rates not so much, but short the euro, easy short, which costs nothing. >> begging you to do it. >> doesn't it, i mean, germany's the biggest beneficiary with the lower euro? >> trying to appease merkel, but at the same time, remember, germany, the biggest export markets are spain, italy, and france. >> for german goods. >> don't forget -- >> good point. >> this is ringing germany saying, germany, you want to be herbert hoover and care at this time about a balanced budget? well, to heck with you. i'm roosevelt. you can't do this to the economy. >> there was discussion that merkel was beginning to blipg or show signs of blinking. >> she's not blinking anywhere. the hold on europe that merkel has is going to come into question because draghi is a brave man. i think this is really brave to

take on the principle country and principle driver of a country that, frankly, has had the run of the joint with the euro, and he's trying to end that. people say, listen, how will he get out? they had minus 5% deflation. the reason i focus on fdr and not bernanke, we had that level of deflation. the country he's trying to ring against had that deflation ahead of the third reich. he sees it. it's not stopping. >> trying to use a lower euro, frankly, to be the mechanism to get growth and avoid deflation. >> this nost economic expansion. you need some demand. >> got to get banks to lend. they'll be paying the ecb to hold their money. question is are they willing to do that? that number's gone up. >> right. >> are they willing to make loans to spain, to businesses? >> so right. opposite of our country. in our country, the reason why

there's housing not up -- really is hard to get a mortgage. why? bankers are afraid of uptick in bad loans that the fete jumps on them. in their country, no one's asking and banks themselves are not stress test. waiting for countries themselves to build. i mean, you need a new, and i'll go there, like a giant autoban project. i'm going there. i know you're never supposed to go there, but we need a new deal. that's what draghi is saying. i don't want to be rescued from too many analogies of the unthinkable, but he's trying to stop the radical fringe of taking over in other countries because germany is not letting that continent grow. obviously, the euro is a huge failure. he's doing his best. >> at a 52 -week low for the first time in two years, and we'll watch all of that. >> i mean, they are just saying, listen, get out of those things, saying you got to get out.

>> on a stronger dollar, what do we want to consider there? you know, obviously, we got things like oil traded entirely in dollars. >> right. we had deflation in the country, thank you, importing their deflation at a time we're trying to still keep our economy going. it's not bad that we have gasoline not going higher. >> froebl going lower aaa says. >> it will go lower. remember, we're now on a situation where royal dutch comes on the show "ed mad money" last night, and says we have to export. too much oil. we have to pump it unless we send it overseas. this is all about getting the oil to where it can be exported when a new administration comes in and recognizes the need for an energy policy. most gave up on the obama administrati administration. they don't want to think about it. listen, we know keystone is a failure, we'll build around it and get the oil where it needs to be, which is the rest of the world, and west texas will be the out price brent.

it is happening to fast, overrunning policymakers in washington, and they have no idea other than pumping gas. >> i mention the dollar, and you go back to the grid of pipelines. all that's in your head. that's all you think about. >> the brept question -- goes to bed, how do you get the oil? >> that and the fantasy league was locked. we had yesterday, i had the ceo of dominion announce the largest single jobs works program in the east for the whole period. it's not from the fed. it's not from congress. it's from the largest single jobs program announced on the show last night, but people do not think about it. tens of thousands of jobs to get natural gas, and they are trying to get this stuff. >> some argue it's low rates why they finance the projects.

>> that's how the summit midstream go, go to the market today, 3.7% yield, and buckeye partners have a big deal today. you want yield? i'll give you that. buckeye partners, know who it is? set up by standard oil. >> really? >> yep. they finally have so much -- remember all the oil in the country found was in ohio and pennsylvania. they have so much in ohio and pennsylvania, they are bringing it back. >> all back. >> trying to get the show to do it in titusville, but it's a six hour trip. >> shares of apple, off the worse day in seven months, down more than 4% in wednesday's session wiping out $26 billion worth of market cap after samsung unveiled new smart phones and virtual raemt headset ahead of apple's big tuesday event. pacific crest apple analysts recommending taking profit in the maker of the iphone. we'll talking to him later in the show. jim, we heard from so many analysts how the stock trade's

down in -- after a product introduction for three months, i think it is. everyone front runs the expected drop that would take place in three months starting on tuesday, and yet i think the drop is less than 4%. do you buy it? >> fool's game. the guys are generating commissions. let's think about this, okay? there's a term since football starts tonight on nbc -- >> 8:30 p.m. >> 8:30 p.m. >> on nbc. >> yes, because the nfl is in charge what they want to do because cbs does not got it. there's a term called the jag, not the jaguars, but it's just another guy. jag, the s&p is just another guy, a jag. shouldn't we think about that, and rather than worry about the wearable introduction or the the street, 16 times earnings on a

balance sheet that the world dreams you have, great momentum, a buy back, a dividend. apple is a country. i would rather invest in apple than italy or france or spain. >> if i'm looking for higher beta names, it's a place to take a source of funds, as they say, particularly when i know the product introduction's coming and history of the stock is that it will not do much. >> up 20% of the year. microsoft is up 20% for the year, dow chemical -- there's a lot of companies up 20% for the year. i just think that we -- we encourage people to get in and out and in and out, we'll be taling people for 3% gain or loss, you got to make a move. >> you said this yesterday. ? 1998, i would do that. come on "squawk box" and say, listen, buy it ahead the meeting, sell it in the middle when ford describes it, and short it di the end of the meeting. that's a hedge fund game. that's over.

they are busy shorting -- >> easy for you because you're not running a hedge fund. >> viewers are hedge funds no matter what, and people at home -- >> carl, you'll be there. the chance always is they actually get it right and introduce products that people get really excited about. >> we'll be there live tuesday. at this desk yesterday, talking about the first new category under a ceo, the only jobs successor, right? his heir, not just another product roll out. >> what's amazing is analysts going back and forth. you know what i want to see in the product introduction? how many i'm going to buy. buy one for the whole family? hey. you laugh. >> which one are you buying? >> the wearable. >> we don't know for sure. >> there's people in line in new york city, and we don't know what the phone is. >> or a watch or what. >> could be a donut for help's sake. give me a wearable that microphones numbers, get the

doctor so i don't go there three times a year, just say here's the numbers, what do you think? do i come in cardiologist, or do i wait? >> or the nsa can call you too. >> so can russian hackers can tell me that i have to stop taking atak taking it, and they can get in the google car. >> they can recommend the generic alternative. d >> there's risk. bring your thumb print. you can't replicate the thumbprint, not even people trying to get in my fantasy team. >> nordstrom is back, up 2.5%. >> i thought it was going to be

a hack. >> home depot keeps spreading though. >> china woes not over, fast food chain looks for a drop in the third quarter ending august in the wake of the safety scare in july when a former supplier was said to have improperly handled meat and expired food. we knew it was going to be bad. >> the fact that these guys are retiring as ceo, the fact is china is declaring war on our companies. this is not, like, just happenstance. it's not happenstance. >> no, no. there is a cold war here brewing in some way. the president's going there in november or something like that. >> the president said we'll defend japan no matter what. defend ukraine, no matter what 6789 what's it about? russia and china. you know, they will retaliate making people have less fried chicken. >> the antimonopoly laws figure into a lot of corporate dialogue right now.

>> this is a cold war worldwide and reminds me in a 1951 pattern, russians and chinese against us in a cold war situation. they had the proxy of north korea. i see no approximaty yet, that's next. >> let's hope not. >> absolutely. >> when we come back, tesla goes all in on nevada, the gig factory, expected to be built in that state and what it means for nevada with the congressman and mayor of carson city. shares on fire since the driver assistance technology is public last month. live interview with the company's cofounder and chairman on "squawk alley," and another look at the premarket. get this, the s&p and nasdaq's 52-week low was set a year ago today. >> wow. >> that's how much a melt up it's been all year long. "squawk on the street" continues in a moment.

♪ tesla chose nevada for the site of the $5 billion battery plant. announcement expected later on today. state beat out california, new mexico, texas, and they plan to employ 6500 workers, and we'll talk with the congressman in the next hour and the mayor.

we know what the stock has dope. not too far where they assemble everything in freemont, california. >> yeah, but the labor situation will be better. tesla continues to amaze. these are big products. talk about europe, going back a sec, there's no tesla there. there's no major -- there's no silicon valley there. i mean, this is what germany needs to do. they have bmw, a great company, where do they put up a factory? >> south carolina. >> or mexico where they send them up the union pacific. there's factories in an amazing little place where they pay $5 an hour, but demand in the country? no. demand in our country? musk -- how many people are going to -- 5,000 -- what's the number? the unemployment is going to be 2%.

parts with 2% unemployment, getting used to that. we have demand in the country. >> very exciting. forgetting about stock price, looking at the larger picture, i guess, of tesla, what it's been able to do so far, and gigafactory, cars, proliferation there, self-driving cars, separately, but partially, but the lifyfts and ubers. >> exactly. kids would -- when you have kids that are college age, i mean, the world shifted. it's stanford, it's occidental, uc berkley, just we're in a major revolution where people used to go to warton -- there's great private schools, great school, but they are going to where the jobs are. they are going to the harvey -- the average tech school. >> hard to get into the east

coast schools. >> oh, noing they are hard. >> we'll have a technology school here in new york, roosevelt cornell. >> i'm just saying there was a time when -- >> sticking up for the east coast here. >> now people want to go and get $500 million for vice for tvc part -- >> 250 million from them. >> 2.5 billion valuation for vice. how you went from tesla to vice, you managed. >> with college in between. >> the college thing is such a tech tonic shift for people and where they go. people know if i get a computer science or engineering degree, i can put up rockets for rusk or build my own company, give a billion dollars from seed capital quickly. what we have in this east coast, bedo have good biotech. our country is opposite of the continue innocent with 7 00

million people and can't find a thing to do to put people to work. harsh. let's celebrate america. you can say it. >> cramer's mad dash, opening bell, and we have not gotten to the downgrade of gopro, costco's best comps in 20 months, futures there, more "squawk on the street" in just a minute. being a keen observer of the world has gotten you far, but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running. take and... exhale.in... aflac!

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the own results, business back on track, and mike and his team, doing a good job. >> with yours in particular. >> great results and all warper's business is very strong. >> last night on mad money, of course, lvh talking about jcp, back to school as we start our mad dash, people thinking it's better than we thought. >> it's strong, and we have job creation, lower gasoline, some of them with deflation, and jcpenney, look, it's been -- the company missed for three straight quarters. this was a make. why? they are selling a lot of product through jcpenney and called out was kohl's, back to school season is strong. >> versus expectations or just strong? >> just strong. i mean, things are not good,

manny comes on no matter what says, not delivering, cutting numbers. they did not cut numbers. they said a lot of good things. a lot is the american consumer buyi ining jeans ago. that's been a hobble category. buying a lot of just apparel that's been not sold. macy's is doing well. don't -- >> tougher comps. >> jcpenney, a major call out. they did work with the heritage brands of pvh, and he mentioned isad. >> that's where the hedge funds, remember, listen, to be fair, you know, there's a lot of smart hedge funds worth listening to, but sometimes they have no idea what they are doing. >> delusion to them. >> fed up when they sold the stock, but missed a lot the whole thing. >> mike was not on the last call, but wish him well. mike, doing a terrific job. kohl's -- people forgot, but

they are on a comeback. second guy, i had the sketchers team on, saying kohl's is doing well. i'm going to visit decker brands. they are doing the opening bell today. they are doing very well. there are a lot of companies that are doing extremely well, and, yes, i have to mention costco which i was too negative on this show. why? because i'm shocked at the same store sales. >> there it is. costco, jim mentioned the opening bell, four minutes away. we'll talk about the stocks and rate cut and impact on the ecb and impacts here. "squawk on the street" back after this. for over 60,000 california foster children, extra curricular activities help provide a sense of identity

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time and sales data. split-second stats. ♪ its so close to the options floor, you'll bust your brain-box. all on thinkorswim, from td ameritrade. you're watching cnbc's "squawk on the street" live from the financial capital of the world. opening bell in 30 seconds. busy morning. ecb cuts rates, embarks on the purchase of asset backed securities, a slew of retail news, adp, by the way, at 204, below estimates, big jobs number tomorrow too. >> right. there's a lot of people -- a lot

of the viewers are in cds. they were terrific, seven years, you are getting nothing. there's a lot of people who says, listen, take a look at these deals that are coming, look at -- look at the companies where they continue to raise the dividends because you're not going to get anything from fixed. i feel badly. there's a lot of people getting hurt. >> there is the opening bell, and the s&p at the top of the screen, and down here at the big board today, we have decker's outdoors celebrating the between brand, i heart ugg. >> that's an interesting shoe, the most cushion of any running shoe. >> over at the nasdaq, by the way, by yo delivery sciences doing the honors. you mentioned costco before the break, august comps up 7, traffic up 5, a lot of people, though, say it's that retail,

people in cds with no savings not shopping at prices like costco. >> i told you the trust sold, and you were surprised with the right to be surprised. it was a mistake. mistake because costco remits a great bargain for people, members of the club, and they sell a lot of products, and one of the reasons it's skewed up because they are selling apple. remember apple went, costco -- apple made a lot of deals, ibm deal, i hope they flush that out more when you go to see them, but there's a lot of good things happening in costco, and the idea that people sell apple, again, i come back -- it's you think you can buy it back quick enough so when you announce what they are going to do, you'll get long again? i don't know. that's a fool's errand. >> august comps up five, and victoria's secret 5, bath and body works, 4.

good numbers still. >> decker brands, they are brands selling well in the country right now. i harken back to sketchers, talking unbelievable numbers. the american consumer, whether it's job growth or because of the lower prices for the tax of gasoline, the spending, and it's a great story, it's not toll. >> among the leader, the top five are almost all retailers, pvh the top followed by nordstrom, l brands, amazon. >> glad you came back to the nordstrom. they were disappointed after the quarter saying it had to spend, but nay are a remarkable company, and it's back. i mean, it's -- the stock is back to where it should have been. it was not that bad a quarter, it was just a good quarter and people recognized that. >> gopro downgraded over at jpmorgan on valuation. stock is up for three straight

weeks. an amazing -- >> don't sell, but don't add to your position. target stays at 51, and they think, oh, the new product for the holiday could be good? could change. >> i had a preview of some of the things that gopro's selling, and that's why i've been bullish. it is an ecosystem. people feel you can knock off, just knock it off, but there's a lot of other aspects of gopro. i agree with the quote. the stock is red hot. when are you going to get another chance? gopro, tesla, netflix, they are not bound by the four wall uls of the earnings per share canvas. >> what about mobileeye? just a few weeks ago, went public here. >> have you looked? >> i have. >> the website? >> yes, i have. >> i think everybody would love to have it in their cars, stock's down because -- stocks don't grow on trees. they don't grow like trees, bean stalks? remember the bean stocks -- should have done time lapse.

i sat there and watched. >> i noticed shares of amazon up 2%. maybe the move along with the rest of the retail, i don't know, a nice note today, retail overall, a benefit as well from the stronger dollar. so much is imported from the walmarts of the world, most is imports. >> new cfo yesterday, never mentioned. >> he leads the call. will be interesting. the calls are open. it's just the word "spend." i don't know if he's on the call, but just plays "spend." they will beat 2015 expectations. i think the take away is profit. >> profits? >> yeah, i mean, amazon's down for the year, but 13%, but has fought its way above 300. before it was trading below that. >> not profit. a game. >> apple down another 1%. >> okay.

all right. shoot me. shoot me that i like apple. >> i won't do that here. i won't ever do that. >> taser me. there's an order from cleveland. look forward to what's going on -- >> taser you? >> you know, ferguson was a departure point for police forces, and the cleveland order for taser is remarkable. i think it's a well-run company. they have the right product for the right polarized climate in the nation. >> interesting. by the way, apple, a couple points, the column in the times today, saying this watch is going to be so amazing that swiss watch manufacturers will be at risk. that's one thing. canner, an unapologetic of apple said it was half baked and products so gimmicky that the launch will be easier. >> i thought that, but samsung, pile on, and when they are down, i think that john -- there's nothing that tells me his record is not 100% in terms of the

judgment. there's not -- is there a hike? just looked at the products, and said america will want them. there's a holiday season. people are looking for products to buy as always. they will not all buy the gopro, although many will. >> what if you make your watch your go pro? >> you mean like this? >> i don't know. i'm not sure. it's apple. never know. i don't know. something comes out, like "get smart." >> the whole bit happens from your watch. why not? >> i thought "agent 99" was the hottest woman on telephone. >> i have to revisit that. i was so young, i was not thinking along those lines. >> i'll forgive you. >> goldman with a note, seeing year end 2050, 2% from here, euro down 9%. they say funds are behind, add

to positions on names with beta and fund popularity, naming net flick, mastercard, eog, sales force, cummins. >> that's a mixture of industrial machinery, difficult, because of the strong dollar with some cloud plays that have reported good numbers that have not really gotten their due, i think, since then, although, concur, which was mad was up, did not talk about it yesterday, but it's a fantastic travel entertainment software cloud. i like the list, but i'll tell you, kostin, he's terrific, comes on the show, but do i like the market? not like the market? i don't know. i don't like that. goldman sach's done well in the period and got the alibaba deal, which we have not talked about, but the show is jam-packed -- hate to use that term. >> goldman is going to be making the decisions in terms of allocations. >> right. >> right. there was no lead underwriter, but a group of underwriters, all

busy with the largest ipo of all time, we'll see, but valuations on alibaba came down a bit. read through the last filing, last week, i believe it was. there's growth that's incredible, but deaccelerating a bit concerning people. yahoo! shares, by the way, have not backed up. >> yahoo!'s been going strong. >> on the bizarre story that soft banks buy. >> i don't like that, but they are good stewards of the capital they get. the 25 companies that are now billion-dollar valuations in mobile. >> yes. >> it's very big. it's got great growth. >> i hear of this mobile thing. i'm going to look into it. >> i like yelp. >> going to investigate this mobile. >> dow's up 36. s&p 2004. >> stock traders continue the trend of making things about the upside here, not a crazy move to

the upside, but still, nonetheless, path of least resistance has been to melt up gradually over the course of the past few years. of course, central banks had a human part in the central discussion this morning, and art cashin said they are looking to do what they are going to do, and the bank of japan did nothing, keeping things constant, bank of england stay k con stability, asset purchase plan in place as well, and the european central bank doing what was anticipated in lowering interest rates, three benchmark rates coming down by 3 points a piece, lowering of rates, and they'll buy bonds, avs, that had an effect, though, on european markets. see with the german dax, a spike higher after the ecb announcement. we are now back down off the session highs, but, still, you can see what happened there. same thing happened to the futures market here, a nice spike higher as well, and then a little bit lower. on the macro side of things continuing on that front, the euro in focus, and interesting

when stock traders talk about euros and rates and macros. a one-year low against the u.s. dollar, and, europe, got me thinking about taking a european vacation and capitalizing on euros for the time being. look at the dollar, dollar strength here, and, of course; all of that has to do with the economic data as well. we saw at least on balance, slightly, just slightly worse than expect the jobs data coming on the weekly jobless claims front and adp private payrolls. that's an impact as well, and push and pull, tug-of-war now, and in europe and the macro front, tilting positive stocks for you, meaning all eyes turn to what happens on our u.s. macro front because two pieces of job data are done, jobless claims and adp, meaning tomorrow's payroll report could have a bigger impact now we have the central bank speak out of the way, the interest rates from globally sourced places out of

the way, and then all the sudden now, the granddaddy of them all, david faber, nonforeign payrolls of august will have a significant impact on the way stocks trade in tomorrow's session. back to you. >> that's right, 8:30 a.m., we'll analyze the numbers. let's take a quick look at a battle i've followed, allergan and a favorite of yours. >> there you go. >> 2.8% of the shareholders consented or sent in their consents to ask for a special meeting of shareholders. that brings the total now from valiant to deliver to 33.8% of the shareholders asking for a special meeting. previously, they will set the meeting for december 18 th, but importantly, they are expect to confirm in the next -- let's call it a day or so -- they received in excess of the 25% of

consents that would be needed to call the special meeting. there's also, though, some question as to weather begin all the paperwork associated with putting in your consent, whether or not allergan is going to go through challenging many of those consents, whether it was properly dotted or t crossed. i hear that's not going to be the case. what they are not going to challenge every little detail of the consents. what they are going to do, though, and continue to do and press the case now in delaware, there was insider trading by actionman, tried in california, sent out, and they may weigh in, nothing that's going to stop shareholders from voting at this special meeting, and it appears we have three more months to run here in which, of course, you're going to continue to have a great deal of questions being raised about the strategy, ogranic growth rate, going to

get another earnings report from valiant, and importantly, we'll continue to at least listen and see who allergan has an acquisition and prevent valiant from pursuing a deal. nothing imminent there. despite the many rumors out there, i hear that that continues to be something they are looking carefully at, but not close to at this point. >> wow. this is an amazing story, this goes on for months, we know that, but i think david has the cards, even though he has the special meeting, the ceo of allergan. >> appear they will let shareholder voices be heard at the special meeting. if they keep the stock price up, up from a low of 105 to 119 yesterday, it'll be interesting, jim. >> right. i think value i can't is over valued, and i think the price is fair lly valued, but the strate

is amazing. >> no one expects the 30% gain. >> true. no, look, i purchased on my own. >> if this falls apart, the 9.7% position could go the other way if they do the acquisition, no doubt he wants the special meeting, but potentially try to oust directors. >> we are surprise at the strength of the defense of allergan. he does not play for dinner, he's a wealthy man, and he just said, listen, i'm not going to let my company be taken away. pyott does not need this. this is not entrenchment. this is not the -- many people recognize from the old days, the company that was greedy and didn't do well, and greedy bad, not greedy good versus what michael douglas, one of my

absolute favorite actors and his dad, by the way, loves what we do. >> wow. >> nothing the matter with that. >> hi, kirk. mr. douglas, sorry. >> let's go to the bond pits. rick santelli is at the cme group in chicago. rick? >> hi, david. we had central bank meetings, but the one that stands out is mario draghi, and look at what the markets did, we can learn a lot. we can always learn a lot when for the few moments the markets are pretty much like emperors with no clothes. you get to see some moves and where they stopped and see it under emotion. if you look at an intraday bund, this is fascinating, remember the low yield closed for the bund, happened first of sent, see the chart? there's flow 88 basis points. it did not challenge on an intraday basis and reversed. look at the bund, open it up to, i don't know, couple weeks to

the 20th of august, you see what i mean? did not make it extreme. that is significant. euro, now, the euro made it extreme, but remember, everything is stacked up against the euro, and the talk is bull. fixed income market is different, scratching its head, but what's noteworthy on the euro against the dollar chart is that virtually it held 130. argue about a couple ticks, and that was significant. now, let's shift it back to the u.s. look at the intraday five, oh, u-turn. everything on the curve is unchanged like a two year or three years and beyond are all higher yield, lower price than they settled yesterday. let's look at the intra-day ten looking like the fives. this is also significant. if you open that chart up, mid-may, using this chart a lot that encompasses at the low yield close of the year and another test, 44 and change, call it 245, and three tick clip, 248 the yield at the magic line. the magic net goes between when

the guys are buyer versus sellers. pay a attention on a closing basis. back to you. >> what a day in chicago. tesla expected to announce the factory to be built in nevada, talking about mark amodei what it means when "squawk on the street" comes back. revolutionizing an industry can be a tough act to follow, but at xerox we've embraced a new role. working behind the scenes to provide companies with services... like helping hr departments manage benefits and pensions for over 11 million employees.

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♪ only one day left to nail the number, just tweet us your predictions for august nonforeign payrolls, use the hashtag, nail the number, and if you win, you get a new cnbc pullover in time for fall, and autographed by the "squawk on the street" team, here on set, and jim signed it in the break. i'm going to sign it now. what's consensus tomorrow? 220? low 220? >> i think that's going to be

low. >> really? >> august was a strong month in the country, we are learning whether it's auto sales, auto nation, whether it be what manny said on pvh, a strong month in the country. and it's not acknowledged, and you got to acknowledge those things, and they are strong. >> up to a minute before friday release at 8:30 a.m. eastern time to submit, and 2:15 is the latest as of this morning. we have breaking news this morning. >> good morning, carl. we have a little bit of breaking news here. federal appeals court granted a legal procedure victory here to the obama administration in the ongoing battle over obamacare in federal courts. remember back in july, a federal appeals court in the district of columbia invalidated subsidy payments by the federal government for receivers of obamacare. they said that states could do

this, but base the on a reading of the obamacare language, they said these federal subsidies were invalidated. the obama administration now has asked that court to reconsider that case, and the court, this morning, saying that it will, in fact, reconsider the fact as the obama administration wanted them to do. this whole r of federal subsidies invalidated presented significant problems for the obama administration needing an elaborate work around if the decision was to stand. opponents wanted it to go to the supreme court to fight there, but as of now, as of this news this morning, this will be reheard in the appeals court, carl. >> and the story continues. thank you very much. >> yep. >> we'll get stop trading with jim in just a moment. ions. there's no shortage in this world. who do you trust? whose analysis is accurate? how do you make sense of it all? a simple, unbiased stock score consolidated from the opinions of independent analysts... is that too much to ask?

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time for cramer in stop trading. >> a call here, citi raises numbers of fedex. the transports driving the market, some is gasoline, but they take the numbers to 201. watch that stock, a great barometer of the market. >> what a show last night, by the way. >> thank you, thank you. we had royal dutch, and deckers,

angel martinez, he's transforping the company, more than uggs. i am doing it from the store at 600 madison avenue, leaving right after here to talk with angel, he's a genius. >> trying uggs? >> when you see the tom brady ad this weekend you'll cry. it's that good. ? really? >> interesting. >> people talk about the nordstrom buy back, a sign of strength or weakness? >> oh, nordstrom spent a lot of money to keep up with amazon, a great customer service company. i think they will be fine. by the way, if you want a barometer, watch grub hub, pricing 10 million, and a lot of people laughed at the companimecompany me. i'm not laughing. >> no. >> now it's below the stock, the base. let's see if it holds. >> i saw this morning 75% of

u.s. ipos this year with no profit. >> unbelievable. >> 45% of bonds around the world yield less than one? i mean, wow. growth starved world. >> yeah. jim, see you tonight. >> the hard knock's life. >> enjoy football. >> thank you, you too. >> always a good day. >> seattle. >> when we come back, breaking news on ism services, reaction to that, and, of course, nevada on that tesla factory in just a moment. ] i wish... please, please, please, please, please. [ 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. introducing cvs health. a new purpose. a new promise... to help all those wishes come true. cvs health. because health is everything.

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welcome back to "squawk on the street," the service sector, bigger swaths in the economy, a powerful number, 359 -- 59.6. last month; 58 .7, the best since november of 2005, this takes out november 2005, and comps are back to august of 2005 at 61.1. this series began in 1997 and the high water mark was 62. we are getting close, carl, back to you. >> wow, after a good week of

data. back to you soon. in addition to a slew of economic data, ecb made a historic rate cut, beginning the qe, and we are watching this all morning long. >> another smile on the face, a big u.s. number with the manufacturing number we had earlier this week from ism, and just better economic data, and at the same time, we'll talk in a second about the ecb. going ways here, folks, here's the numbers from adp, up 204,000, light relative to expectations, and if they are right and government adds to, the private sector from adp, the forecast here, and government adds, seventh month in a row above 200,000. the july number revised down by 6 00,000, 212,000, and goods and services up, small business up, medium business through the the economy, construction 15,000, manufacturing up more than 20,000, and there's the nonforeign payroll for tomorrow,

225, relative to adp could be lighter, but other data, claims at 302. low firing levels. reversing half of the q1 decline, and the july trade deficit, folks, people look for maybe a half point to a full point addition of third quarter gdp, where it is now, 3% because it's deficit number. now, on to mario draghi, cutting the rate to.05 from .15. it's going further negative from minus .1 to minus.2. they are involved in increasing the size of the balance sheet, a qe that's going to happen initially through asset backed security purchases, details in object, and covered bond purchases, last part in the expected. in addition to the re-fi

operations, and that's not all. here's what draghi said about quantitative easing. >> should it become necessary to further address too prolonged a period of low inflation, the governing counsel is unanimous in commitment to use an additional and conventional instruments within the mandate. >> so, sarah, active qe, what does that mean? how it it different in targeting the lts, and credit easing he talls them, qe is broad purchase of private and public as in sovereign bonds if the ecb does that. that's under discuss. >> interesting that he left the door open to that. thank you very much. >> sure. >> for the run down on the u.s. data and ecb. for more on the major market move, what we see in currencies this morning, let's bring in nick, the head of currency strategy with wells fargo. nick, a rare treat i lead off with currencies, but a 1% move gets everyone's attention.

negative on the euro, does this mean that that move has further to run? >> well, i think it has further to run over the medium term. the contrast between the u.s. and europe is stark at this appointment. the economic performance, the recovery that you mention in the u.s. versus the slow growth in europe, and, of course, contrast on monetary policies. we had a target of 127 in 12 months. i think the euro could be as low as 122 and 124 in 12 months, but not 100% sure there's downside just right now. >> what's going to trigger that? the full-blown quantitative easing as steve mentioned draghi left the door open to? >> important for the near term. the ecb spent the monetary ammunition and measures you mentioned, so it would depend on whether they do the quantitative easing. i don't know they are there yet. it's going to depend on the strength of the u.s. data and whether or not we think about rate increases. that might be the thing that, as we start to move towards higher u.s. rates, that extends the

euro longer, but that might not come for a while yet. >> it's moving, materially weakening, into the 120s, how helpful is that to europe? we keep hearing the low rates, negative rates is going to be difficult to really stimulate the european economy and deal with the problems. the weak euro should be very helpful, right? it should be helpful, a question of, as you say, helpful, it's hard to know, i mean, the european exports, 15-20% of the economy like the u.s. exports are important part of the economy, but not a huge part, and the success or otherwise of the ecb actions comes to whether they are lending with some of the borrowing rates in countries like italy and spain and corporates there and whether or not businesses borrow again. that's going to be more consequential. stronger exports help, but byist, it's not enough. >> if i'm investing in u.s. stocks or u.s. bonds, what does that mean that we're really

seeing moves here, big moves from the currency market and stronger u.s. dollar? >> probably means -- i mean, i think it's relatively neutral -- well, overall positive. there's negatives and positives in this. i mean, for multinationals with foreign activities, certainly the euro weaker is going to help in terms of the foreign earnings from the u.s. side, you know, it's going to help in terms of liquidity around the world, helping markets in general. overall positive, offsetting the u.s. >> notable because euro strength meant target strength. breaking that relationship. the swiss national bank here, it's a big deal because we are at critical levels that the swiss national bank said it was going to defend. do you expect intervention here? >> well, if -- you know, if needed, for sure, i think we'll get it. i don't know that the market's going to track on the bank and get down to the 120 level.

if needed, i don't see any problems with the bank either in more intervention or shadowing the ecb and thinking about negative rates as well. the 120 is determined for the central bank to defend. >> strange times. nick, thank you very much. head of currency strategy at wells fargo. exciting morning, carl. >> very. u.s. stocks extending gains, s&p and the dow are above their closing records, not quite at an intra-day high. bringing in the chief investment officer, pnc wealth management, drew, managing director with ubs. guys, good to see both of you. >> good morning. >> jim, lofty levels, but data continues to impress. what's your take now? >> you're right, carl, impressive week of strong data today capped with the ism. we suggest a positive feedback loop for the economy, a self-sustaining economy, pnc looks for 230,000 job growth tomorrow in the report, so i think we'll continue to get good news and trend for the overall

market is upward as we continue to set new high here. >> are you in the school that, yeah, trajectory's up, but we are in a plateauing process that gains in the back half of the year will not be as good as the first half? >> i think we'll probably likely see some consolidation in the 2000 level as the market is used to the levels, and we can't forget that congress is back in session nooext week. that's not typically a positive. we have midterm elections. there will be a period of consolidation digesting the gains before we hit significantly higher levels. >> all right, drew, there was the gdp revision, auto sales, ism's been a barn burner, beige book was good. how does that continue and not show any sign of inflation? >> well, i mean, that's a million dollar question or million and a half with a lot of inflation. you know, i think it's important to bear in mind that we are beginning to see signs that the labor market is generating wage inflation, seeing surveys coming

out from small businesses saying they have to pay up their workers and see expectations on the consumer side also suggesting that most american consumers are expecting their income goes up over six months. hard to imagine how it happens without wages. i do think that, you know, we are going to see wage inflation, beginning to see overall inflation, and the best question is, with everything going right with the u.s. economy, you know, can we afford to wait until the middle of next year to tighten? >> can we? good question. when do we have a shift in tone from yellen, and when it is too late? >> well, we get an update for the forecast in the middle of september. most people are expecting to see some more detail on the exit strategy there. i permly think it might be early on that front. but, certainly, september into the fourth quarter is the period when all the volatility can begin to pick up. you have a lot of changes that are going to be taking place with regard to the fed, more detail from the ecb, and you

have scottish referendum. a lot of things on the table that could go wrong or affect markets and should mean increase in volatility moving ahead. >> jim, you know, some of the bulls with higher targeting for year end, part of the argument is that funds, who are behind, are going to try to catch up and do that by adding to positions they already have. big names already doing well this year. is that true? >> i think partly true, carl, without a doubt. after we get through the elections is a positive time, particularly midterm elections is a positive time. the markets will continue to see strong economic growth and earnings. follow on that. i think you'll see investers coming into the market here who have been skeptical as skepticism turns to optimism here, and we'll close the year at new highs. >> we'll see. second time we've heard that congressional factor, and it is nine weeks until the my term. keep that in mind. jim, drew, thank you, see you later on. >> up next, russia, ukraine,

syria, iraq, all key issues, and we'll talk to the foreign aff r affairs committee member, ron johnson, about how world leaders should handle the issue. plus, apple bouncing back from yesterday's losses, but one analyst says sell the stock and booking your profits. he'll join us live on "squawk on the street" when we come back.

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reject isolationist impulses and con front the terrorist threat poeszed by isis in the middle east as they meet in wales to discuss russian's intervention in ukraine. joining us on post nine to discuss it, ron johnson, senator, great to have you. good morning. >> morning, carl. >> we have the so-called putin plan laying out terms basically involve no concessions, freeze it all right here, like the ground i've been able to get. take that seriously or not? >> great timing, huh? >> yeah. >> no, you can't take it seriously. he likes playing the west, and we need to understand who putin is. he's a tyrant. he's going to continue to aggressively expand, you know, his sphere of influence. i hear the talk about we have to offer him an justify ramp: he's not looking for that, but for on ramps. we have to check the aggression, show strength and resolve. >> so what's nato's play book over the next couple days?

people say, be careful, you know, you can go very small distance and find yourself at war with russia. >> well, there's a war right now. russia against ukraine, and if we don't check that expansion, it's just going to continue. what we should have done, monday morning quarterbacking, we should have when he came here, bought him the small arms ammunition, that wouldn't have provoked putin. he doesn't need further private kags. if we don't support, we see disastrous rules. >> i mean, the president has been supporting them, what do you rem specifically at this point forward u.s. in terms of president obama's response? more sanctions? >> had we supplied lethal weaponry, antitank rounds, trainers to train the ukraine military how to use them, maybe russian tanks wouldn't have crossed over in ukraine. we have not shown support. as a result, there's no price that putin paid here, he

continues to -- aggressive expansion with impunity. >> ukraine is not a member of nato, a partner, and article 5 says you look out for your members. >> understand. >> somehow how do you square the argument if. >> it supposedly ensured the integrity and self-governance of ukraine. russia does not respect that at all, we should. this doesn't require u.s. combat troops on the ground, but it leaves a visible, vocal, overt show of support for ukraine. now, we have not done that for months, but we are seeing what's happening. again, the excuse of not providing small arms ammunition, not providing lethal support is, well, that could provoke putin, but, again, i repeat, putin is not looking for off ramps. he needs no privacy. he has the strategy in mind. >> some of the european partners, though, live next

door, and they take on a meaning when there. >> if you continue expansion to a curb, that threatens the security. you achieve prestrength, not showing strength. >> and some argue we're not showing strength with isil. i understand the republican criticism for not having a plan, although the president has said we have to eliminate i sies. what is the republican response in terms of military action? it's. vague. what needs to be done? >> first of all, dispute the fact that president obama has not had a strategy. he has. it's withdrawing from the world. he doesn't think america's input in the world is positive. he thinks because we've been involved in the world people hate our guts. >> but specifically with regard to the threat. >> he's been withdrawing. so now we have to reverse that strategy and recognize the threat that is here, that is real, and president obama has to use that bully pulpit, explain like his deputy assistant secretary of state in front of

the foreign relations committee described why isis is a threat to america. they are streaming, funneling 30 to 50 suicide bombers into iraq every month. they could easy funnel those suicide bombers into america. that's the threat. president obama has to explain that. be very clear in our objective. he was not clear. he said our objective is clear, degrade and destroy. well, that's even ambiguous. he wanted to say we have to manage isis. no, we have to defeat them. we have to obliterate and eliminate them. >> need congress's permission to do anything? >> i was part of the bipartisan group in the white house talking about a new authorization for the use of military force. i think the president should come to us so we can provide not only this president but future presidents tools, the authorization needed to continue to address this ongoing threat. this is not going to go away any time soon. this is a threat. we need to recognize that, give any president the ability to respond effectively. >> the law of unintended consequences plays out strongly

in the middle east. i mean, we go up against isis, we drop bombs, helping the she unites who killed our soldiers in iraq, helping secure assad's place in syria, even though we want him out, and we're securing our enemy, iran. >> you have to learn theless sops. historic blunder was not leaving a stabilizing force behind. we wouldn't have seen iraq disintegrate or seen isis rise from the ashes of what was al qaeda in iraq. recognize that is a huge blunder. deal with the reality as it is today, and the reality is uglier because of that historic blunder. deal with it. isis is not going away. they made aimings clear. they want to establish this call fate, resources now, far better trained, far more effective, far more dangerous and coming after the west. they made that clear. we ignore that at our own peril. >> great to have you.

>> thanks for having me. >> come back soon. >> will do. >> senator ron johnson. >> up next, apple recovers after the worst day in seven months yesterday. find out what analysts say you should sell the stock now. we'll be right back. being a keen observer of the world has gotten you far, but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running.

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welcome back to "squawk on the street," shares of costco, shares higher after climbing 7%, much better than the street forecasted. reven move increased 10%, best rebates in two and a half years. stock trading up by %. sarah, back to you. >> good day, thank you. apple shares are having an okay day coming off the worse day in seven months. yesterday's session wiped out $26 billion in market cap. this after samsupg unveiled new products ahead of apple's big event next week and pacific crest securities saying sell now. to explain the call, the seep your research analyst with pacific crest securities. people blame the samsung event,

the icloud breach or security concerns around that, and your call to book profits. state your case, why now sell? >> well, you've had substantial multiple expansion in the last couple months here, and it's now trading fairly fair outside of range for the last couple years. the big issue that we see is not anything to do with the next couple quarters, because, frankly, we think they will be fantastic, but once you get through the iphone6 cycle, there's difficult comps, dealing with saturated markets, meaning growth slows, mull. contrac contracts, hard to get stock higher. >> there's a lot of excitement, for instance rs about the entrance of wearables category. do you not see this adding to the valuation? i mean, where does that fit in in terms of apple's near term and long term profits? >> yeah. well, we'll see. i mean, actually, you know, to clarify our call a little bit, it was we're skeptical they are big enough to matter, but we'll

wait and see. i'm -- i'm of the view that it's really, really hard to get anything to be as successful as iphone as ied pad. those are the two most successful consumer lek tropics products in history, and make a didn't with wearables when every product come so far is a failure on apple's scale, it's just a tough hurdle. we'll see. it's going to be really difficult for them to offset, i think, a decline in iphone if that happens. >> you're looking for products that generate, in your words, billions of dollars of incremental operating profit. how do you know if that's the product? >> well, that's the trick, i guess, right? >> i mean, are you saying there's no way, or -- what would they potentially offer? >> no, yeah, so i'm not saying there's no way. i'm saying that i think the way is -- that there's a very, very small percentage chance they find the way. what they are going to have to

show is something that i think changes the world. to be frank. it's going to have to be not only massively valueable to consumers on an everyday basis, but something consumers can buy. we'll see. they have to come up with something i have not thought of for sure. >> stock categories, seven months yesterday, the target was a hundred. say they don't do what they are asking, come out with the downgrade, has there been enough damage in the past 24 hours that -- where would your rating go? where does the target go? >> no, i mean, so we've covered for apple for seven or eight years, and i think i've changed the rating twice in that time frame. we think longer term, and, you know, if they don't come out with, like i said, a new product that really generates billions of dollars of opportunity, we would downgrade likely based on what we laid out in the note yesterday. >> all right.

contraryian view there, andy, against the optimists around the stock. good to have you with us. >> yeah, thanks for having me. >> still has not out performed on apple. >> intra-day highs on dow and s&p this morning. watch that. when we come back, tesla's factory goes to nevada. we'll talk to the congressman who remits the area about what it means for them after the break. when fixed income experts work with equity experts who work with regional experts who work with portfolio management experts that's when expertise happens. mfs. because there is no expertise without collaboration.

welcome back to "squawk on the street," i'm squak ki

deangless reporting from the imex. waiting for natural gas storage last week, not in focus in the energy complex because it's not impacted by the dollar say the way crude oil prices are, but we are watching prices right now, at $3.86, up three quarters a percent. the number coming in, just waiting for the board to update here, an injection of 79 billion cubic feet. that is higher than most traders expected. we are seeing the prices, actually ticking up a little. that is because nat gas was beat down, under $4, and expectation in the fall is better storage to catch up from the nat gas used last winter. people are looking at that at this appointment. it's higher than what we saw last year at this time, higher than the five-year arch as well. it is a good report. trading at 3.80.

back to you. >> thank you very much. the broader markets right now because the dow and s&p 500 hit new all-time intra-day highs as we speak. the rally coming on the heels of the historic announcements by the european central bank, mario draghi, not expected, the euro plunging talking about implimting asset backed security bond program, qe, leaving the door open to something broader than that. the euro, the chart of the day, down more than 1% to levels we have not seen since back in september 2013 hitting the low 130. gainers for the s&p 500, retailers, pvh, jim cramer talked about that, the ceo, and amazon, costco, carl, put out nice numbers in terms of same store sales. >> total comps, fuelling currency, up 78, best no 20 months, traffic up five, new

warehouses by year end, and one new location. costco, a great year and richly valued, able to keep comps coming in the tough time for retail. >> is it a costco story positive or a story about the u.s. consumer? everyone is trying to figure out where the consumer is. the losers on the s&p, staples noble, diamond offshore, and staples has been a mover this week, and credit swiss balder put out a note that staples should buy office depot, competition from online retailers, keeping up in the space and retailers, david, are you pondering that one? sort of heats up. i know you are watching -- >> i thought they already were. staples -- all right -- yeah, forget what merger that was. i'm watching shares of bp now because they are down. all we got right now is headline from bloomberg saying that the company has been found grossly negligent in terms of the mccondo spill.

we are waiting for the judge, u.s. district judge, to issue a decision on whether or not bp, already paid out as much as $28 billion or more and faces additional liability perhaps, whether he would as the main operator of the well find them grassley negligent. what does that mean? basically means that it's a determination that conduct was worse than mere carelessness and could mean additional liabilities for bp. the stock is getting hit again. all i see is one headline at this point, but it is an important determination for the judge to have made and not good for bp, obviously. >> on a week where haliburton settle. >> and check out -- speaking of

move movers, gisele signing, a teaser video we got with the announcement she'll be joining jurp armour, showing her kick boxing while comments appear on the wall around her. they appear to be tweets and roll out a, to see her use the prugs and updated stretch of comments appear on the wall around here, part of the push to grow its women's business. >> she does left too, right and left. >> you know i box. >> that form is unbelievele. turning thes, how you want to do it. >> you box too. >> that hurts. >> she's burning there. that hurts. >> sthast hard core. >> she's not gisele for nothing. speaking of moving, tesla

announcing nevada as the site for $5 billion factory battery plant, a big deal, beating out california, texas, new mexico, and we'll speak with a congressman from the state of nevada what that means later on in the show, remitting the second district there where it would be built, and we'll ask what it means for jobs, 6500, right, the amount of jobs? >> that's right. >> actually joining us on the phone, we do have that republican congressman as we speak. mark amodei, where the plant will be built, good to have you on. >> thanks for having me on, good morning. >> it's a game changer. nevada, a gambling state trying to turn to a manufacturing state? >> it's not a well-kept secret anymore. we are, diversified in western nevada from the resort business. this is a big feather in

governor sandorganization val, and folks in western nevada. it's a tide that raises all ships whether you talk for the airport growing, for all sorts of commerce, general notions of commerce, just a big -- a big shot in the arm for an area that has been coming back from 2008, and 2009, but this represents a huge step for the folks in western nevada. >> how, exactly, did you court tesla and musk? that was a heated race, california, new mexico, texas, and nevada, how did you insent vise them to build in your state? >> well, there's the traditional notion of incentives, and the governor calls them into session to formalize somewhere in the neighborhood of 400 to $500 million in incentives, but what happied, really, looking logistically in proximity to lithium, a big deal to the

batteries, proximity to the manufacturing plants, no tax, things like that, the place where they should have come. i want to thank the folks from tesla making the decision on where it should have gone rather than in auction and who gives us the most money. hats off for the right choice for their kbaen and we're going to do the best to make sure that we make them look smart for coming here. >> musk did say that any state that got it would have to offer a certain amount ofinsentives. i think 400 million was tossed around. >> it was subject in conversations with the governor's team and steve hill's economic section. it's not a secret the package is somewhere between 400 and 500 million in terms of various tax incentives, but as you know, when you compete with the texas and california and other countries of the world, listen, if it was an onauction, they wod not be in nevada. they did the right thing, made a

responsible offer, but the thing that i think really sold it in the final analysis is this is the location where they need to be in order to get things done quick because it's in story county. they get building sufficie inin going, they are already grading, within proximity of resources, access to renewables for energy and hours away from california. it makes sense to be in this location. >> you mentioned diversifying away from gaming, which is interesting. is that a mission among the state executives to try to diversify industry? >> in western nevada, we dive e diversified out of necessity. think about years ago with the construction of the mirage, we didn't do that in western nevada, and it was a good decision. we didn't have the ability to be las vegas, so they have actually dope a very good job in western nevada. manufacturing, logistics, distribution, you know, there's

folks that -- amazon is in western nevada. >> yes, yeah. >> there's a big walmart distribution center out there, where the guys are going, and so that's what's kept us from being as hard hit during the 2008 and beyond stuff as perhaps southern nevada was. >> you have not recovered as faster of the nation. the up employment rate in nevada is 7.7 %. the u.s. up employment rate is 6 6.3%. you're in the top near michigan. how fast can you get it down to the national average? >> well, tell you what, 65,000 or 6500 jobs in this part of the state, will not materialize instantly, although, but it's a big deal in western nevada with a population of half a million with five or six coupes. this is a huge deal for taking care of, i mean, it's not the answer to everything, but it's a big piece of the puzzle, and so, you know, that's not counting

the place, bigger than the average, you know, walmart or something like that. >> yes. finally, congressman, any chance it does not pass, the legislature? >> i don't think so. the nevada's legislature's sensitive. 75% of the people from clark county, where most the population is, but this is something where they looked at it, saying, yeah, you'll put somewhere between a half billion and little less than that into this, but when you net, net, net it out, and the commerce it creates and other stuff, it pencils in and it's a smart thing to do representing a win-win, not only for the company, but the region, so -- >> all right. i hear that the taxes are pretty good there too, and that helps the decision. congressman, thank you for joining us this morning on this news, and congratulations on winning that race. congressman mark amodei, good to see you. >> thanks. >> the cofounder of mobileeye

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one of the closest races in north carolina, our chief washington correspondent john harwood has the latest of the balance of power there. good normorning. >> reporter: we had a race here last night between the democratic and republican challenger. it really reflected the strategies seen all across the country this fall. both candidates cast themselves as bipartisan deal makers, but offered partisan messages. tom is running hard, casting a tool of president obama, and obamacare's part of it, but not as large as some people thought. the attack broader than that. >> got elected, voted with

president obama 95% of the time, and she went to washington, she rubber stamp obama's failed policies. since you've been in washington, you voted with president obama 95% of the time. should probably regret the fact she's. a rubber stamp for reid and president obama. >> she distanced herself from president obama especially on foreign policy, but she also went to a strong strategy to mobilize her base. she talked about need for action on immigration, la tee knows a big vote here, talked about criticism of the police response in ferguson, trying to motivate african-americans, and talked about tilles and republicans trying to restrict abortion as a strong appeal to women, especially single women. >> killed an equal pay bill, does not understand the needs of women. again, he does not understand the needs of women.

i think he's out of touch with women, and doesn't understand their needs. you know, again, he does not understand the needs of women. >> he respond on the contraception attack saying, like republicans in other states, he wants contraception available over the counter to expand access that way, and, again, this in arkansas, louisiana, alaska, all the battleground determine whether republicans or democrats control the senate for the last two years of obama. >> getting fistier, close to duke's arch rival there in north carolina. let's get to the santelli exchange, hey, rick. >> morning, carl. i want to welcome our guest, a sane economist to be sure, peter, thanks for taking the time this wild thursday. >> thanks, rick. >> all right. let's go over the mar iio dragh

show. i know what he said. you know what he say. interested in the response of the market place. u-turns on the bond place side, ten-year, a significant level of 244, maybe more important, the bund reversed, could be the highest yield close in two weeks, only the euro that stayed down on the move. how do you square what's going on in the bund with some of the comments made regarding quantitative easing and outlook for the central bank? >> well, remember what happened after qe1 and 2 started in the u.s., yes went up. maybe with what draghi announced, most was dell graphed, if people think he'll inflate, well then interest rates should go higher, maybe that explains why bond yields move up. that's the catch 22 and conundrum faced if they are

successful in raising inflation expectations, interest rates go up. that's not what they want. i think we're seeing that first hand here. >> excellent. you ended up exactly on the intersection i want to be at for the next question, and that, of course, is when it comes to the victory celebration, higher interest rates have to be a part of that. what are these state funds going to do in these countries, in these areas around the globe that service levels of debt that they've never, ever before seen in problematic in your opinion? >> absolutely. the western world is choking on too much debt. last thing they need is a sharp rise in interest rates. rather than central banks sitting back cheering low inflation because that equals low interest rate, they want to reverse that. be careful of what you wish for. if you have higher interest rates, it's cryptonite to a world addicted to cheap money

and choking on debt. >> as an old technician, looking at charts, i have not been bearish all year, but the set up on the chart for u.s. ten-year rates is getting close. let's switch gears quickly. maybe some of the surprise questions and answers came from the bank of japan with regard to, hey, all the sudden we have somebody in charge of the central bank who is now asking for a weaker currency, please. now, did that surprise you at all? >> it's the only weapon central banks have in order to generation inflation, and that's to import it, import it via weaker currencies. >> but japan's -- if they have a bigger trade deficit, already have a huge deficit in terms of the balance sheet, boy, is this going to be two heppings they don't want once it's on the plate? >> i'm not saying it works, but what they are trying to achieve. it's clearly not working. the japanese economy is back to where it was in the second quarter of last year even after everything they had implemented.

>> peter, thank you, out of time, unfortunately. always look forward to the conversations. >> thank you. >> back to the "squawk on the street" gang. back to you. >> thank you very much, rick sa. coming up, fast-food work s striking. multiple arrests in new york and detroit. details on that, after the break. aflac! and a gentle wavelike motion... aahhh- ahhhhhh. liberate your spine, ahhh-ahhhhhh aflac! and reach, toes blossoming... not that great at yoga. yeah, but when i slipped a disk he paid my claim in just four days. ahh! four days? yep. find out how fast aflac can pay you, at aflac.com. 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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check out shares of veraphone. raising revenue the third time on strong seams of devices that can accept chip embedded credit cards. particularly interesting. may have another potential breach. >> thanks. fast food workers walking off jobs across the country today. latest effort in an ongoing campaign by work toers obtain a minimum wage ofs 15 $$15 an hou. mcdonald's released a statement saying it's more of a franchisee issue. wendy's says it offers education and skill enhancement to move on to other jobs. reports of several arrests here in new york city and actually cnbc.com, an interesting breakdown where people who work

at hamburger restaurants essentially make the most and least money. arkansas, nopt tt too good. highest state, connecticut. >> mcdonald's saying you can't raise the wage by a large amount. that will hurt franchisees and that will hurt the business. interesting to see how they continue to respond to this getting more heat. over now to kayla tausche with a look what's coming up next on "squawk alley." >> sara, one state shining brightest in the sun belt. that is nevada. we'll have the mayor of carson city, nevada, talking about that tesla giga factory and what it means for the state. also, a smart auto company, first earnings since going public. stock don, even though earnings looked good. about what about the outlook for the rest of the year? that and finally, those radio-streaming wars are heating up. a partnership with cumulus media

going through dropping the spotify model. what does this mean for that company and about the future of music? all up next on "squawk alley." dad,thank you mom for said this oftprotecting my future.you. thank you for being my hero and my dad. military families are uniquely thankful for many things, the legacy of usaa auto insurance could be one of them. if you're a current or former military member or their family, get an auto insurance quote and see why 92% of our members plan to stay for life.

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only one day left for you to nail the number. just tweet your predictions for the august non-farm payrolls report. out tomorrow. use handle @squatstreet #nailthenumber. if you're the winner, you'll receive a pullover, ougautograp by the entire "squawk on the street" team. 8:30, predict your predictions by then. consensus estimate about 220,000 jobs to be added during the month of august. we did get that key number out today. came in a little light. 204,000 jobs added. down from 22,012, still on trend. >> where's your number, can i ask? >> i haven't even thought of it. >> do i dare? above or below? >> always go with a very bearish. >> do you? >> i usually do. >> why is that? >> i don't know.

maybe a negative person. >> things feel good, man. feel good. >> the services number out, manufacturing number. >> auto number. back-to-school sales seem fairly strong. >> what's your number? optimistic? >> oh, i just listen to the experts. i don't have my own number. >> i'll give you a number tomorrow. >> talk bp? time? look at shares of bp down about 4.5% we told you. a federal judge ruling it was recklessly negligent, the company at the spill. when you read the decision it says the punitive damages will not apply due to citing precedent in the fifth circuit. more reporting perhaps needed here. you see the stock actually worsened in terms of losses for bp. already pate out well in excess of what, over $28 billion related to this. however, the concern was that if they were found recklessly negligent, as they were, that it would be more punitive damages, but trying to square that now with what he also says, there will not be punitive damages, as

i said, because of a fifth circuit precedent. we'll monitor it. >> also want to point out, big mover of the day, euro. at a left we haven't seen since july 2013. ripple effects on markets. watching impact on stocks, on oil. wonder pressure, with that over to jackie deangelis, breaking news. >> good morning. watching the inventory report from the department of energy. delayed a day for the holiday this week, and crude oil inventories seeing a draw of 900,000 barrels reported for last week. that's slightly less than a lot of traders expected here. we are watching prices. hovering around 95 dollars. they are moving slightly higher now. $95.17 for the october contract. the key to remember here, the crude oil trade now is really driven by that stronger dollar. we saw more strength in the dollar after the ecb and its rate decision this morning and also the idea that more stimulus