permanently move here just so i can wear a hat all the time and hold these babies back. although i have to say, if i took it off, they might -- >> there they are. >> -- they might break off. that -- >> all right. brian. good, man. see you later. thanks for -- make sure you join us tomorrow for "squawk on the street" is next. ♪ ♪ good monday morning. welcome to "squawk on the street." jim cramer and david favor on wall street as we kick off the month of december. china and europe's pmis came in softer than expected. moody's cuts japan. black friday weekend sales appear to be a bit soft and then there's oil falling 11% in a single week down again this morning although rebounding a bit. still below 67. just a stunning chart. the ten year yield, 216. just a shade above that crazy

low in the middle of november. oil is slumping around five year lows. as a new month begins for the rest of the markets -- >> spending drops double digits this back friday. but online spendsing alone jumps more than 20%. >> target, best buy, home depot, others go after tally target alibaba. l china's official pmi slipped to 50.3. that's below forecast. the dow and the s&p each finished the month up 2.5%. nasdaq up 3.5%. nasdaq, jim, within almost 5% of an all-time closing high. can energy at 8, 9% of the index drag down the markets? >> it's funny you mention that because first of all i think friday was very exaggerated. just kind of got to really take

that whole black friday for oil with a grain of salt. i think it was really an anything but oil move on friday. it's like, look, just get me out of anadarko. i don't care. get me out of -- some of these -- >> consho. >> corrigo, get me out. what happens? what do we put it in? it never seems to go to cash. let's just put it in land research. let's go to kale. it was like, okay, i'm going to park it in tech. i'll park it in sanders. i know that sounds odd. >> or target or whole foods. >> whole foods, the new whole foods, that they had finally been there for thanksgiving. we always have a whole foods thanksgivi thanksgiving. whole foods has a whole foods tavern approach. people like it. yes, i think there was a lot of money out of oil into whatever else wasn't oil. that was the rally.

>> when you look at a stock like continental, which we mentioned, which was $80 a share let's call it the beginning of september. >> right. >> and is now 40, over done or -- i mean from a 30 billion market cap to a 15? >> i mean, i think first of all, yes, overdone. more importantly harold hamm famously came on cnbc and took the hedges off. oil was at 85. >> november 5th i believe it was. >> he believed that oil was done going down. i had -- on "mad money" i had him on. right after i had sharif suki. let's go to the 60s. one guys says 100, one guy says 60. obviously one was right. taking off those hedges is something that is almost suicidal because the companies that kept the hedges on are ones that are still of interest to me. >> so now everybody's tossing around the 40 number. i mean, are you still a

directional bearish bet on texas? >> you really have to believe that china is just going to go off line like europe. there is going to be no -- i was looking at the rig count, which is what i like to do. the u.s. rig count from november 26th from baker hughes, 1517. i've been saying the finding costs all in, i know that brian sullivan is up in the bakken, when you're in the eagle, they make too much money. they're not going to stop. they want market share. all we hear about are the saudis want to preserve the market share. the real companies are the anadarkos and the marathons. >> you have said and i've heard others say it as well, low 40s they can still make money or that's sort of break even, somewhere in that range. >> remember, they're pumping. once you drill, you're pumping. the cost of a well that's open is almost nil, and if you drill in the permean, we know that oil is there. the price all in is really very

fungible. the reason why i say this, if you don't drill any dry holes, your price is really lower. in the old days we used to drill a lot of dry holes. that was a mistake. we spent a lot -- there are no dry holes in the permean. there's just oil or lots of oil. >> which is the way it should go. when i'm looking at the totality of things as an investor or somebody trying to figure out the u.s. economy, the importance of oil and gas in terms of capital spending, in terms of drilling new wells, then against the lower price of oil, hence, the lower price of gasoline and consumer spending, how do i balance this out as i try to figure out what may happen? >> 85% of the s&p does better, raises numbers. the 15% goes down. 15 states directly impact it with lower gdp. >> unemployment. >> there's 50. in each case it's the consumer versus oil. now we started getting the

reverberation, the rales. 3% of what rail traffic is is oil and people are just looking to shoot anything. whereas merrill, merrill upgrades american. they downgrade delta because they hedged. i think the answer is it's still the law of how many people benefit versus how many people go down. beneficiaries are humongous. >> gasoline $2.55 by christmas. >> i paid $2.65. that's all a rouse. >> who uses prepare zblum. >> why? >> that's a roux. >> my father told me this. what are you doing, prepare zblum now what's important just so we know, this dispute over online sales versus mall. i think the newspapers did a little disservice. there's two outfits i monitor for online, com score whom i

don't know and channel advisor whom i know well. channel advisor, they're the keeper of the numbers. they came up with incredibly strong numbers. >> let's back up for those who might have missed it. signs in a change of the black friday shopping. sales did fall 11% over the thanksgiving weekend compared with a year ago. this as early promotions and a rise in online shopping lowered sales in brick and mortar stores. today is cyber monday. later on squawk in the street courtney reagan will have a conversation with neil ashe. national retail federation polls consumers, others poll the retailers themselves. >> this would be like if you're watching -- if you're looking at the cable company. they know what stations are being watched versus neilson who samples. there are real numbers when it comes to the internet and

they're real numbers. then there's polling. polling is irrelevant versus real numbers. real numbers, you have the actual numbers. amazon average up 32%. that's not polling, this is a very good piece. that's up 32%. hey, listen, it's up 20%, it's up 40, it's up 32. that's what i care about. howard schultz, ceo of as far bucks has been saying, this turn against the malls is happening much faster than people realize. these numbers showed you that this was the non-mall christmas. i know elle brands would disagree. elle brands, victoria secret and bath and body works, they've done very well. >> yes. they've somehow figured something out. >> yes. ross stores. tjx. but these are not in the mall. the classic mall did quite -- >> we've talked about that for quite some time already in terms of the decline of the mall. there are people on both sides of that debate, jim.

some say, listen, it can still be a place where people come to gather, you can make it exciting, interesting for people, for them to want to be there. >> they all say that and yet the aggregate numbers say that that's not true. remember, there are shopping centers and there are malls. malls, maybe they have the flying wallendas. each mall may have something, a santa. you can't sit on santa's lap in amazon. i mean, just graphically it's a horrible idea. >> no, doesn't work. doesn't work. >> santanography. >> maybe as zuckerberg keeps working on that technology, put that on and the next thing -- >> the whole gram santa. >> meanwhile though, remember walmart's guidance going into the holiday season wasn't all that hot. isn't it looking better now? >> yes. they were one for one. you go on twitter, is there no price i can't pay for walmart? we're finding that there is a price. i know brian kornell, target, having a good christmas.

these were factoring in an unbelievable christmas. that's difficult. some of the apparel companies are having unbelievable christmass. >> walmart is a straight shot up from 77 to 87 in a few weeks. >> i think that's overdone. i just think that that doesn't make sense. >> doesn't make sense? >> no. i think that has to pull back. >> all right. we're going to talk a lot more with retail for the next 24 days. amazon knows the feeling. alibaba being targeted by traditional retailers in an ad. we'll show you that after the break. john skulley's perspective on the iphone. >> talk about numbers up. >> the smartphone numbers heating up. take one more look at the pre-market with the dow, the s&p and the nas up for six consecutive weeks. more "squawk on the street" from post 9 in a minute. stamps.com is the best.

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♪ ♪ light that thing up soon, i think. >> wednesday. wednesday night. >> traditional retailers are taking aim at alibaba. target, best buy and home depot has produced an ad granting

states more authority to collect internet sales taxes. take a look. >> alibaba is china's largest online retailer. their ipo was the biggest in wall street's history, now they're coming to america. thanks to the online sales tax loophole, this chinese company will decimate our local retailers unless congress ends special tax treatment for alibaba and other online giants, main street will never look the same. tell congress. close the online tax loophole before it closes main street. >> alibaba's denouncing the ad insisting it pays taxes according to the laws in the countries in which it does business. of course, amazon itself faced the same backlash after it started housing all of its distribution centers in different states. it benefitted from not paying the state sales tax in different places. for its part it's funny having spent some time at alibaba, very

hard to macon clugss, but i think while there is an enormous amount of runway in china, given their dominant position, it is hard to imagine they will not be successful there. it becomes a much different construct for them when they come here. >> their site is -- looks a lot like amazon. 90% off shying sexy lingerie, www.gear/lover.com. well -- >> is that where you went at the first place? >> i hit a button. that's what came up. that was probably a mistake. how about men's shoes? i can contact the supplier. it looks good. geez. >> corporate i.t. guys already know. >> you can use -- >> sales tax or not. >> as a consumer to buy things there, but they are going to try to become more aggressive here

although that's long term. they own 80% in china with more and more people getting online every day. >> it doesn't matter. >> no brick and mortar there. here, really amazon just going to roll over? >> any way it works for americans is that you can order things to be built and it's cheaper to have them built. >> alibaba.com. that was sort of empowering small business to use suppliers over in china. >> men's pants. you can make men's pants. you can make hoodies. >> bar chairs. >> i priced those out. absolutely true. >> i know. absolutely true. >> amazing what an effect taxes are. >> alibaba, just like the rest of the long line with amazon, you price compete. i mean, the price discovery now worldwide is embarrassing for retail. it's like, holy cow, that's how

much they marked it up? >> speaking of mark downs, amazon is going to cut the prices of the fire tv from $99 to $69. i mean, we're back in this mode where they are giving away the store in the near term. >> at least they're not paying you to take it. it's really just -- >> who knows if that's next. >> the phone, they are paying you to take the phone with the subsidies and amazon prime, i think they're paying you to take the phone. nobody wants that phone. >> no. some devices you just don't need. zoom, right? >> that was microsoft's music player, right? >> there is no gain on zoom. >> nice reference. >> wow. still a great one. >> when we come back, it's cramer's mad dash. we'll count down to the opening bell. a lot more "squawk on the street" from the nyc in just a minute. s, and i quit smoking with chantix. i had tried to do it in the past. i hadn't been successful.

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♪ ♪ ♪ i see that clock, paris, i think euro. then i think maybe it's time for a trip. i don't know. >> wouldn't you like that? >> yeah. >> just get away. >> some people talking about parity. parity. >> well, i don't know. you can go to jcpenney where the trends are improving or go to harrods. >> the pound is strong. >> we're going to paris, david, you and me. we'll take a long weekend. >> i am there. where are we starting? >> deere. going to sell the whole.

pricing in the negative. jpmorgan, sell or hold. now, look, one of things that is interesting i thought commodities were collapsing. if that's the case, you want to sell deere. i think that people think the crop for deere has been had. this stock is coming back. if you feel that way, you should look at agco which is dirt cheap. >> on the subject of commodities it is notable that copper is coming down. not just oil, we've had a number of them. is there a bigger message being sent? >> china, china, china. still more primitive, nonsubstitutable. iron is a price war. there is no -- talk about the kindle, the fire, whatever? i mean, iron has come down and it just doesn't stop. if i were cliff's resources i'd be concerned. they'll tell me not to be concerned. don't be concerned from their point of view, but iron is just sinking like an anvil. >> all right. all right. >> now apple makes a lot of

stuff in china. >> now ubs says the smart watch will be big. barclays raised it 120, 140. we're in one of those periods between here and year end you can raise your price target because it's been over run. apple is even better than we thought. it's going to be an apple christmas. i6 selling well. the annuals are way behind this number because they always wanted to trade it, they never wanted to own it. our mantra is to own apple, not trade it. >> should you be concerned when those that follow the company have come up with different metrics by which to justify their new price targets? >> that's precisely when you have to be concerned. what i don't like is this multiple expansion period. meaning we're paying too much for the same earnings. there was a note today saying that micron and sandus, people are going to start paying more for their earnings be. that's not what you want, not solid fundamentals. the earnings are going up and you're paying the same amount except for a higher amount of earnings. that's a real bull market. >> okay. any thoughts we should have as

we start december here for stock that's already up over 49% and a broader market? >> just be aware that we did it for real money on the street. the winners keep getting bought. the battleground will be rales. they have been huge winners. people feel because they do fracking, sand, oil they'll be hurt. watch the rales as they tell about whether the end of the year is going to include anything other than soft goods, consumer product goods to benefit. the rales and the battleground here. >> we'll be watching the rales and a lot of other stocks when the opening bell rings in six plus minutes from now. we're back with "squawk on the street" right after this.

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we kick off the month of december. jim passes along a note from morgan stanley saying maybe add a little more to your portfolio above the benchmark.

>> yeah, i liked a guy who had it as a market weight. selling it is most gravitas. it's time. this group has come down a lot. i do go back to that friday. it just was -- some of these declines, 30% declines in a single day are not warranted from some of the ind pen debts so i think this makes sense adding 2% to slumber j., 1% to oxy. that's the new stock that spun off of oxy. let's not be too positive. we haven't seen the downward revisions of the oils. you have a one-two punch. first the stocks go down and then people explain why they went down. you have to do that before you hit the bottom. >> it echos what s&p is saying. when the relative strength of energy is this far below the overall market, energy tends to outperform over the long term. talking 12 to 24 months. >> if you look at the contango, what oil will be worth, you'll see a $75 price.

>> it's interesting you raise that. they're fairly highly leveraged and some are public, some are not. are they in trouble? >> their silence is a little dpaunting. magnum hunter came on. gnat gaz has not been bad. the other way to look at it, when gnat gas collapsed, you would think there was a shut in. natural gas, the production exploded. >> any chance that oil goes

back? >> almost impossible. >> new england uses oil which is why they're building so many pipe lines up to new england. no, you don't switch. there is some more use of oil. there is some demand that spurred as oil goes down. we know that from marathon pete which talked about one of the largest gas station companies but the change in -- and there is a spike in the number of bigger gas guzzlers, but remember the cafe standards have changed things dramatically. >> right. those aren't reversing any time soon. >> no, doesn't mean we're not going to do bill hummers. >> meantime you guys talked about copper, gold. australia's ten year below 3% for the first time in a couple of years. the ripple effects are clearly happening well off of our shores. >> copper and iron, the commodities that were chinese building commodities, they're saying that china is going to decelerate dramatically. i still find that hard because of the secular shift from rural

to urban. there were periods where it was secular. it's not the chokehold. it's not the heimlich. what's heimlich in chinese? >> might be heimlich. >> it says everything. >> i think it was sustained. >> no sales tax on the heimlich over there. >> there's the opening bell and the s&p at the top of your screen. a little bit more red than green. the big board, california resources celebrating its spinoff from occidental petroleum. celebrating cyber monday. >> it's interesting. nice piece by credit suisse that was out november 14th. crc, this is not the market to be an orphan spinout without debt. november 14th wasn't the market, this is the real not market to do this today. that's some unfortunate timing

for an oil spinoff involving california reserves. >> yeah. >> oxy's up more than a percent. >> there can be a balance. even a dead cat bounces which is in reference to my cat that was hit by an 18-wheeler that was crossing the road. believe it or not, 7 inches higher after it went by. >> no kidding? >> yeah. i think it will be momentary. >> that's what's going to happen to oil. >> momentary. numbers haven't been happening yet. hasn't happened for anadarko. >> they have rex in tomorrow. we'll get to hear. they have a 50-year plan. they have a new ad campaign, egg campaign, i kind of liked it. you might want to click on that ad campaign. exciting. been a long time since i recommended an ad campaign. >> we have names like fedex and

costco in the green, others like best bike and i think michael koers close to the bottom. >> i think costco will be the company that people rally to every time it goes down. it does well in this reading oil, remember, because they have the lag in the refining, they do sell a lot of gasoline and the thing that they're always looking for the best in show to be able to show how brilliant they were and costco is the one they're going to gravitate to. that's my view. >> alcoa gets an upgrade. citi resumes it. ups it to say a lot of the hard work that we see, commodities, has already been done in aluminum. >> a lump number luminum is the show. that was kind of a reinitiation where they had a $12 price and obviously again overridden. i do think aluminum is doing exceedingly well because it had been financially manipulated, so to speak, and that's over.

klaus when he joined the board of morgan stanley, i think he figured out the name. that was a good move by him. >> it was? >> i think it was. understand the way the financial hedge funds were doing, playing with aluminum, allowed him to kind of -- with a new benchmark that was less lma. that's what you're seeing. we've got amazon up and alibaba down. >> there you go. >> it may be down because it's down. amazon hanging in there. >> someone believes in the com score/channel advisor more than they believe in the newspapers. today is a big day. look, i've never been part of it. i think that one of the things that's happening with price discovery is the whole friday thing, black friday thing, that's now going to be talking about oil as black friday. i think that people have figured out that's part of the demullification. >> it's not about one day. it's not about the sales day before that. they will continue long after that.

>> yeah. >> it may be that we end up with a bigger number for the selling period that comprises christmas, if you will. >> right. fedex will do well. i think there's no -- remember from last year how you could buy it three days before. the retailers had a lot of inventory, that was the best time to buy, not that friday. the door buster. my kids were saying, door buster. door buster is something that happened in my parents' generation. they busted the door. what the heck is door buster? >> meantime, the airlines are having a nice bounce here. southwest up more than 1%, expedia. travel getting a little bit of attention. >> they don't stop. when you have someone a big firm like merrill and they're talking about jetblue going from sell to buy, everyone wants to be on board the airlines. a good article -- "usa today" had this great piece about how you're not going to get cheaper tickets. >> no. no. they go up an average i think of $5 a day going into the holidays. >> yeah. they're booked solid and, you know, i'm trying -- anyone who's

trying to get tickets knows this is the extra money, people are traveling more, cracker barrel being the strongest in the restaurant group because those terrific stores are on the side of the road. i know that one day i'll have to treat you to a cracker barrel pie alamode with a snies slice of cheese, cheddar, on top of the vanilla ice cream. they call it the heart attack, just kidding. it is delicious. >> i have been to a cracker barrel or two in mississippi when i was doing my world com documentary. that was the main place to eat. >> he was at the gym. >> who, bernie. >> wasn't bernie evers at the gym. >> he was a gym school teacher. >> shooting, just fantastic. all restaurant stocks have been strong because people do -- they just do eat out. they order more expensive stuff. >> people are doing more if they're not actually buying more. >> well, i mean, the idea when you read "the new york times,"

all the articles about how shopping was bad, it's not like they're saving more. so where is the money going? i mean, they're shopping online. we're going to see that today. >> a couple of downgrades. dr. peple, snaple cut to underperform over at rbc. >> where was he the whole way out? come on. >> carnival, goldman cuts to neutral saying the turn around is taking longer than expected. also, the industry seeing what they're calling a stealth supply surge. >> yeah. i read that. these stocks have been up huge. there was a heavy short position during the ebola scare. i think that people are finally trying to bring in their shorts. it's a well-timed downgrade. that said cruises are another thing that i think maybe goldman's underestimating. they use a huge amount of fuel and they're not cutting their prices either. >> that is true. a stock that i've been keeping an eye on that has been going nothing but up is down today, time warner. on friday it hit the number that fox was willing to pay for it.

obviously we all knew that that number was higher, although not high enough perhaps to actually get time warner to the table, but it was an amazing run for time warner. very much unexpected since fox walked away and the stock saw the low 70s not very long ago. >> goldman today reinstating fox with a buy. >> jeff pucas is a great american. this was clearly a decision that he made where he said other than air gas i've never really seen -- typically what happens. >> allergen did get sold. >> right. air gas and time warner. >> they said staying independent where time warner was able to simply articulate its goals. >> the numbers haven't risen. the time warner numbers haven't rizzs zblen. >> they haven't raised numbers. >> they have those incredibly high -- >> well, those are my words. they have very aspirational goals for 18, 17.

>> so far so good. it was really incredible. it looks like in retrospect that fox was trying to steal it. good job. disagree. disagree. >> no, i'm not agreeing or disagreeing. >> that's good. >> yeah. >> because i feel like one day we may need to revisit this. >> one final note in that. a lot of studio news. dream works, movies still drive this stock and penguins of mazda gas car was not the open that you wanted. 21 million. >> getting hit badly. >> i know. geez, maybe another country would have been better. penguins under chile. >> madagascar. >> i don't know. when i see this dream works, weren't they supposed to be bought by hasbro a few weeks ago? this has been a football stock. you really want to stay away from it. >> with all of that and the dow is down 57, g.e., walmart and utx leading them on the down side. bob is on the floor.

>> hey, bob. >> hi. december traditionally slow. retail sales numbers over the weekend here in the u.s. let's start with china. the key point, the pmi for china, manufacturing number down to 50.3. that's the lowest since march. bottom line, china had a big week last week. it was because of stimulus beliefs. hong kong has been choppy. you can see the hang seng down 2.5%. a lot of the big iron ore names had a terrible week last week and are generally down. bhp billiton down 10%. the three biggest companies in europe, germany, france, italy, those are the three biggest ones, they saw manufacturing contract for their data. new orders fell off the fastest pace in 19 months over there. these markets held up well but

data hasn't been supportive. u.s. retail sales, national retail federation spending fell 11%. everybody blamed it on early promotions and online sales. that's true. november should be called -- we should call the whole thing black november rather than black friday. target was doing promotions on and off throughout the month, particularly on wednesday before. walmart had a whole week of promotions in the week before black friday. definitely took away. look at the online sales numbers. ibm online, up 14%. up 9.5% on black friday. we're approaching 15% for total retail sales. that is a percentage of online sales. i think that's starting to get very significant overall here. so much though for lower oil prices helping the consumer. i did see on friday some very clear indications of some of the discounters and the dollar stores and some of the

restaurants moving nicely. cracker barrel, denney's up on friday. that's fading. we have a mixed picture. texas roadhouse had a good day on friday up about 4%. bottom line, despite all the stimulus out there, still, very weak economic data. that's what's weighing on the markets. >> thanks so much. let's get over to the bond pits. check in with rick santelli. hey, rick. >> hi, carl. we're watching rates revisit the crazy november and we closed 28 basis points. the interyield of 187. the settlement was 214. the two-day chart the real catalyst was the early close trade friday pushing yields on that ten year below 220. indeed, they're close to unchanged right now. but they r hovering. open the chart up at six-week

lows having settled at these levels since the day after that 10: 10/15 -- i called it the capitulation. we last saw a close of this magnitude. open the chart up to may of 2013. i see we're under 290. virtually unchanged from a 30 year as well from that early friday buying spree but now these are 18 month low yields for 30 year bonds. we talked about the spread holding at 50. that seems to be right about the differential. i'm over simplifying. look at the spread. spread is lost four basis points since last week. it's not at 150, it's at 146. boon yields are virtually unchanged at 170. a quick trader on the floor said i'm looking for 66 basis point boon because i don't think the

fundamentals have changed. we'll have to wait and see. let's look at foreign exchange. a lot has been said about what mario draghi is going to do and what it's going to do to the euro. a lot of that has been priced in. if you look at november 1st to today, we haven't really gone anywhere. the euro is still holding up rather well and has had a bounce today along with all the other major currencies. look at the pound versus the dollar though. even though it is up today, the dollar index is down close to half a cent. the pound and flip your thought process around, dollar versus n yen, they're undriven like the euro. carl, back to you. >> rick, check back with you in a few minutes. rick santelli. meantime, oil prices getting a little bit of a bounce here after fooling to five-year lows.

jackie deangeles is here. >> we're looking at west texas intermediate, it's up 1 1/4. we're seeing a little bit of a technical bounce because we fell so far so fast. i do want to highlight, overnight we did fall under $64 a barrel. that was because of the weak manufacturing data coming out of china. we are rebounding from there. this is tipped fallout after the opec meeting on thursday. no production cut there of course sending those prices down more than 10% on friday to close at 66.15. the question traders are talking about is what is the new equilibrium for oil. that is something that we have to consider here. a lot of people didn't expect it to fall so far so fast. barclays is saying under 70 a barrel. you have people talking about oil in the 50s. the question is if we can get there before the end of the year. i do want to point out that last time we saw oil fall like this,

from 140 to $33 a barrel, that was in 2009. you had two major differences there. first of all, you had chinese demand and you did not have this north american production. so this is really a supply story right now, and it is very important to keep a close eye on it. carl, back to you. >> jackie, thank you so much. jackie deangeles. are you watching g.e.? >> it's funny, carl. the oil story crepes into areas, jim, you might not always anticipate. i looked at g.e., why is the stock down 2%, oil services? >> yeah. they really made it bull ush. g.e. has positioned itself as a company that does better when oil goes higher versus going lower. people will re-evaluate saying, did they pay too much? the oil service group is certainly one where the numbers are way too high. now that said, the stock's overshot. baker hughes is starting to go higher.

there's no doubt about it, the off shore drilling is where it's just not going to pay. those are longer term projects, but it's very difficult to say, you know what, this is the time to go prospecting in gold. the problem with the gold in mexico, you're not necessarily going to hit oil. when you're doing it on shore, you're going to hit oil. g.e. has a mixture of everything. remember, the last meeting was about why we moved into the hottest area of the u.s. ee ckcn hottest area of the u.s. ee ckoy economy. i'm saying there was a moment where everything was looking real good for oil and g.e. made it in. >> when we come back with the first holiday shopping weekend in the books, walmart taking on amazon. looking to capitalize on cyber m monday. we'll have courtney reagan's interview with neil ashe in just

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down over 2 1/3%. friday bloomberg reported that that company holding internal deliberations and analyzing the financial and regulatory hurdles to a potential acquisition of liberty global. internal deliberations. we have different sort of reporting standards. i guess, jim, in some ways i come at it from a different place. companies oftentimes do analyze things because you need to be in a position to know. there is no disputing the strategic logic or potential logic of these two companies which if you think of it they're supplying broadband and other services throughout europe. that said, it's very much unclear whether john malone who has soft control of liberty global has any interest or whether they have a price that would interest them whether they

could get there to try vota phone. i did speak to malone a couple of weeks ago. i talked to him about liberty global in part because there are always sort of rumors about a potential linkup. would he sell, would he buy? it stopped at that. it did lead to this. >> everything is a possibility, david. you know, you have to follow your nose basically on an opportunity. in the case of liberty global, they still have a pretty good runway ahead. the u.s. market is more mature in video, digital, so on. the european market still has a lot of growth opportunity embedded in it so i think for the moment liberty global is going to stick to their knitting for the most part and vertical

integration is more theoretical. >> at least it would seem from what he says there's a lot more ahead of them in terms of what they can do. they do compete against voda phone. competing in other companies which liberty wanted to buy and then voda phone ended up buying. >> i think you correctly point out, companies talk all the time about merging. >> internally. >> internally. it's one thing if you reach out and you have conversations. it should be noted. now there are plenty of investors who want to know these things. i don't want to take away from the reporting at all, but you've got to keep them in -- at least understand the process, which is any company worth its salt is going to be analyzing these things often. >> i know. by the way, apple -- >> down 4% in a hurry. very strange. we'll get stop trading with jim in a minute. "squawk on the street" will be right back. for respawn, building the best interactive entertainment begins with the cloud. this is "titanfall,"

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thank you. ordering chinese food is a very predictable experience. i order b14. i get b14. no surprises. buying business internet, on the other hand, can be a roller coaster white knuckle thrill ride. you're promised one speed. but do you consistently get it? you do with comcast business. and often even more. it's reliable. just like kung pao fish. thank you, ping. reliably fast internet starts at $89.95 a month. comcast business. built for business. time for cramer and stop trading. >> i know this is going sound sop poor rifk, but sometimes you get algorithms that says you should sell all tech. i'm sure some machines said let's undo the friday move which we had in tech.

let's undo the nasdaq and blow out of them and everything that's internet. that's what's happening. i think that, you know, in f in trading, this happens. has anyone said anything about apple? should it be sold now? i don't want to trade it. >> you've been saying that for a very long time. it did lose about 6 bucks in the span of ten minutes. >> that's silly. people will say, wow, i guess i'm being too greedy. we're reversing everything from friday except for the oils where we continue to pound them. they're very rare. exxon is up a little bit but the oils remain -- until i see the number cuts, i think it's dangerous to speculate because of who's got the hedges off. i keep thinking about continental. we talked about it during the break. >> that was not a two for one split. >> not smart. >> not a good time to get rid of your hedge. >> some people make bad calls. i think what ham did, he had a giant like first half, okay? then he had a manning like

second half. i don't know if you followed, if you had stopped that game at the first half, that's what hamm should have done but he took off his hedges and, therefore, the jags won. >> what's on "mad" tonight? >> we've got sketchers, which has been a very hot stock and then we have fiesta group. you may not know fiesta group. that's oil tropical. that's been very, very strong. this restaurant group and some of the retailers are doing quite well. we'll listen to greenberg and wineberg. sketchers is a cheap stock. >> see you tonight, jim. >> thank you. >> we'll get ism at the top of the hour. don't go away. (trader vo) i search.

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welcome back to "squawk on the street" and welcome to december. breaking news, november read of ism manufacturing expecting 58. it's better. 58.7. last month's 59 unrevised. 59. last month's read was the best since march of 2011 when we had a 59.1. let's go through some internals, shall we? on the week of jobs, jobs, jobs, the employment side? well, it dipped just a bit from 55.5 to 54.9 and, of course, new orders, something we're always paying attention to.

it moved subtly ahead pretty much the opposite of employment to 66. its last read, 65.8. carl, back to you. >> thanks so much. rick santelli. >> bemo capital market research releasing its 2015 outlook this morning. expect another year of moderate gains. s&p 500 target 2250. we're at 2153. the dow is down 100 now. joining us on "squawk on the street" exclusively with that call, brian belsky, chief investment strategist with bmo capital market. you're looking at another positive year. to zoom in to today's action, commodities are the concern with oil collapsing, gold collapsing. are you worried that that could interfere with your equity call? >> no. and, in fact, sarah, good morning. >> good morning. >> a couple of weeks ago we talked about energy and we proved to our clients and investors that the market doesn't need energy to go up

to -- to go up, okay? that's number one. number two, i think that there's a perfect storm coming together for commodities, both in terms of materials and energy. number one, demand and global growth is slowing. number two, prices are going down, right? and because of that, number three, there has to be a massive behavioral change within investors and companies alike as we shift our focus fundamentally with respect to these commodities from demand to supply. in the 1990s, as you know, oil prices were considerably lower and wti went down a lot. stock market went up. so i think it's one of these situations where growth is going to be coming from different areas of the world, namely north america. we have to get off the emerging market trade and get off the commodity trade. >> it's an interesting call. it's not just cheaper oil and

better for the u.s. consumer, but causing some concern about super low inflation. not to mention deflation. >> first of all, let me debunk the situation wti. it goes into the pockets of the consumer. it typically takes a number of quarters, number one. i think that's too simplistic. number two, the deflation trade has been in place for a while. the fed's going to be on hold for a while. the triggers are going to be north american growth and wage growth. >> for a while? for all of 2015? >> at the earliest, second half of 2015 at the earliest. the key is wage growth. the growth engine is emerging markets, the last cycle. the growth engine the next 15 years is going to be america and north america. as growth in on shoring and the capital expenditures come back to america, that's going to be

very, very positive. that means even more volatility in emerging markets could be good for america. >> didn't we learn, if we've learned anything, is how interconnected we are. if you were on a plane with four engines, one is working really well but the other three engines is beginning to stall, europe, japan, china, can the stock market really rally substantially? oil is falling because there's a lack of demand. we can talk about deflation in terms of just price activity. something very serious is happening to the other parts of the world, to the extent that the european central bank may or may not panic during the course of this week or not. can we really -- and this is a genuine question. it may be that we can ignore that, it may be we can sail on. i have to ask the question whether that's the correct assumption. >> right. i think it's too soon to use the decouple p term like we used to there 2006, 2007. there's a couple of points i want to keep in mind.

number one, america's still the world's largest economy, okay? number two, china and emerging markets are still growing. they're just not growing as fast as they used to. what do we know about the realities of both japan and europe? aging demographics, poor macro growth and, oh, by the way, i still think that europe is in the early stages of this whole devaluing the currency and the whole notion of what the central bank's going to do there. i think it's going to be a wile, simon. in the meantime, america because of this lost decade that has spurred what we believe is a 15 to 20 year bull market -- >> lots of other polices have had a lost decade and they're deteriorating. >> the difference is coming out of this lost decade is america who has the world's largest economy and who has structurally reformed themselves to the tune of massive balance sheets since the 1950s growing stable earnings and attractive valuations, and really low interest rates. >> as a bull, we have to ask you, you're expecting, what,

another 10% move on the s&p 500 next year. how do you explain the gloom in the bond market? how do you explain a 2.15% yield on the ten year treasury? >> well, it's been a 30-year bull market in bonds. they still had all the money. if you see where the flows are, the majority of flows are going into fixed income. by the way, fixed income had a positive return. that means investors aren't going to sell until they lose money. they're still in control. that's how i explain that. i think that is a good offset for stocks. remember, we're seeing mid cycle returns here. we believe over the next three to five years we'll average 8 to 10% return. it's the last cycle of the trend, really the last 5 to 10 years of the bull that can get real exciting especially if and when we get corporate tax reform and repatriation which is not part of the next couple years. >> one can only hope. brian balkie, thank you for sharing your new views. national retail federation,

weekend sales both in stores and online dropped 11% from last year. walmart saying its online sales have surged. we want to welcome walmart's global ceo of e commerce, neil ashe and courtney reagan. take it away. >> reporter: neil, thank you so much for joining us. as simon just said walmart reported that online sales on thanksgiving day coming in the second best day in history, second only to cyber monday last year. here we are, cyber monday again. are you going to beat last year? >> good morning. welcome to cyber monday, the most exciting shopping day of the year. so, you know, as you said, we had a good thursday, friday, saturday. we had some of the best deals that are available for our customers today. so traffic's starting to build as the country wakes up and we're looking forward to hopefully a big day. >> and we should note that you are in san bernardino, california.

very much folks are still waking up out there. on black friday best buy experienced a surge in concentrated mobile traffic which caused the retailer to have to take its website off line to make some fixes. what is walmart doing to make sure you can handle today's traffic? >> so over the course of the last couple of years we've done a ton to improve the shopping experience for our customers. so we've rebuilt the entire technology platform so they have a new shopping experience on the site and on the app. in fact, over the thursday, friday, saturday, 70% of our traffic, it was record traffic, 70% of that traffic was on mobile. so the experience is getting better both on the site as well as on the 57s. >> mr. ashe, i believe sarah down at the stock exchange has a question. >> hi, neil. thanks for joining us. my question is on e commerce as a percent of total walmart sales. obviously it's the sexy part of the business, growing double

digits. still, it's a fraction of walmart's total sales. where do you want that percentage to be? how much of the pie do you want to take in terms of overall sales at walmart? >> well, the -- i think the definition of what is e commerce and what is retail commerce in a company like ours, which is uniquely positioned to be both online and in stores, is quickly fading away. and this holiday season is a great example of that. as you look at how we program the shopping experience for our customers, we hyon line specials starting on thursday morning on thanksgiving. we had the one hour guarantee in the stores starting thursday night and carrying through to black friday. we have great cyber monday deals starting this morning. even including we're launching something new we're calling the cyber evening edition. we've held back some of our best deals and some of our best inventory for the working moms and dads that are busy at work during the shopping time. as you think about that, what is online sales, what is retail sales? we're really just trying to

serve customers. that line for us where we're trying to integrate digital and physical unlike anyone else is really blurring. so the faster we can grow online, we will, but really the goal for us is to drive all of walmart sales. >> we have seen it. 20 to 30% growth. are you taking share from amazon as you grow your online business? is that the big elephant in the room with the price moves? >> we're excited about our growth and global e commerce, walmart.com, we're in ten places around the world. we've taken share and part of the way we've donna in the u.s. is to get really, really sharp on price. we've built some of the most sophisticated pricing tools in the industry so we know where price is online. we know that we are competitive. so four out of five times you'll find a price on the web in the u.s. we'll have at least the

lowest, matching or the lowest price anywhere on the web. >> mr. ashe, you have said and the company has said $12.5 billion is the sales line forecast for online. could the holiday season change that forecast? >> i'm sorry, i couldn't hear the last part of that question. >> could the holiday season change the forecast for $12.5 billion for that target for online sales for the year? >> yeah, i understand. we're looking to grow in the mid 20s for the year and obviously we're thinking about the holiday season as part of that. this is the big season for us and so we're counting on shoppers continuing to shop through the holiday season. cyber monday is a big day. we've got more deals coming for the rest of cyber week. unique to walmart is 70,000 items you can pick up today. the online shopping experience will continue through christmas for us. of course, that will be part of

the sales but we've had pretty consistent strong growth around the world, throughout the year. so we're looking to finish strong. >> well, mr. ashe, when you have more numbers from today, cyber monday, we'd love to hear about it. for now, i thank you very much to your time. we'll let you get back to what will surely be a very busy day. >> thank you and i hope you guys get shopping. >> a little programming note. we're delighted to say that the ceo of walmart doug mcmill lon will be on "squawk box" on wednesday morning. >> phil lebeau has fresh data on black friday auto sales. hey, phil. >> i've been talking to some of the dealers about how strong the friday sales were. the early report friday auto sales, black friday auto sales were very strong. up more than 10% is what i've been told leading to a big weekend. the estimate right now for november auto sales for the pace when we get the numbers tomorrow will be about 16.8 million. a few optimistic souls are

saying we could come close to 17 million, guys, back to you. >> phil lebeau. when we come back, three months ago oil closed above $95 a barrel. now prices, of course, at five-year lows down about 30%. what does it mean for u.s. producers? we're going to get a live report from the bakken in north dakota when "squawk on the street" comes right back. leration and stop-and-go driving, your savings on gas could be equivalent to how much? up to 50 cents a gallon? 75 cents? $1? the answer is... up to $1 a gallon. sensible driving avoids unnecessary energy loss saving you money and reducing co2 emissions. take the energy quiz -- round 2. energy lives here

welcome back to "squawk on the street." the analysts at jpmorgan downgraded the stock. they reduced it to 51 bucks from a prior 53 saying positive developments are already priced into the stock. those shares down about 5% as a result, sarah. back to you. >> thanks a lot, tom. oil prices hitting fresh prices after the opec decision last week. what does it mean for u.s. producers. brian sullivan is live for us in north dakota where it looks awfully cold, brian, with more on what it means for energy companies here. brian. >> reporter: yeah. it's about negative 10 without the wind. that's a little cold. people up here are tough. we have to be tough. what does that mean, sarah? what it's meant is a severe drop in the oil company prices, we know that. there are derivative plays you have to watch for. it's not as cut and dried as the

oil companies themselves. i reached out to one of the oil companies about what they're trying to do to lower their cost. it's called wpx energize. they said margin management and cost management will be key. we plan to renegotiate rates with our service providers and continue to work on lowering our well costs. read between the lines in what they're saying, guys. the pipeline operators, the drill rig operators, they're going to start hammering them for cost cuts. that could mean wage kuss. that could mean real estate costs that are soaring could be hit. watch the pipeline companies and even the rail roads, guys, they're going to get hammered by the oil companies to lower their prices. speaking of the oil companies, i know we want a cut and dried, clear number, what's the break-even point. it's not that simple. a lot of companies have been here for a long time.

it's not that easy. mike kelley has been a great resource for me. here's what he said, the highest cost producers or not the highest, s.m. energy, oasis petroleum, northern oil and gas. some of the lower cost, kodiak oil and gas and marathon. halcon resources. the only thing i could get a consensus on, marathon has the lowest cost of production here in the bakken. other than that, it's piece by piece. >> brian, people throw around a figure of $42 as being breen-even for a huge bulk of the industry where you are. is that not working? >> no. no. way higher than that. >> okay. >> i would say -- i would say 68 to 72. i think 45 is true for a lot of the bigger ones maybe, simon, but you've got to remember. continental resources, some of the biggies, they're probably at that level that you talked about, but there's a lot of companies that just started up the last few years that are

paying huge sums to get the leases on this land. guys, i can assure you, the land is very hard. it's expensive to drill here. >> brian, that's why they call it a shale boom, of course. >> it's a snow boom right now. >> good to see you, brian. brian sullivan there in the bakken. for more on oil, let's bring in art hacken. amidst all of the doom and glam, the volume has come back in, the price of oil has moved off its lows and i think we're up at least 6% from the bottom of that trough to where we are now though clearly the level is a concern for many people. >> yeah. no. i think the markets in general are feeling around trying to find out. is i don't think anybody clearly knows what the costs of production are. markets are feeling around for that. there is some sense here that we could be building some kind of bottoming process in oil maybe

somewhere in the mid to low 60s. we'll wait and see where they are. then of course the technicals you bounced off 20 -- there's a support band in the s&p, 2048, 2051. that allowed you to bounce a little bit. you've gotten some things going. as you aptly point out, volume is up a little bit so far. >> after the holiday. you would expect to have had some exaggerated price moves and then the market comes back with volume and corrects which is what is maybe what we're seeing. >> even at that i think the volume this morning is heavier than normal volume. >> on the equity market? >> which may indicate that our friends in europe or elsewhere are selling here because it's easier to sell here than elsewhere. they may be slackening off on that. the seasonals, we're going into an absolutely promising period. believe it or not, years ending in 5 have a great history of an up side bias, better than 6, 7

to 1. the second year of a presidential term is better. the first and second quarter of next year all have strong upward biases. >> you've been pounding the table on seasonals for a few weeks. is that notion too consensus now or not? >> well, it may be getting there. when the seasonals jump off the page at you, and they haven't been wrong so far. i mean, we'll see. this week will be a greatest. this week also has a an upward bias. >> only once in 30 years has the dow not risen between the middle of november and the end of the year. >> that's right. >> once in 30 years. >> that's right. the numbers, the rarity, it gets even bigger when you get into some of the other things about years ending in 5. the other thing you want to watch for is the vice chairman of the fed, mr. fisher is coming in. he may try to set the table for friday, not that he knows the number ahead of time but get

everybody prepared if numbers are better than we thought, what will be the fed's response. sit back, relax, this is what's going to happen. on the negative front, geo politically, the talk is that isis may have surrounded kobani. if that's true, that will not be good. >> money continues to flow out of russia and the ruble. another side effects of what we're seeing in the whole reshaping of the energy landscape. >> absolutely. many investors are still in cash. there are estimates that over $11 trillion in cash is sitting under this market and hasn't moved yet. interesting. good to see you. have a good week. >> my pleasure. up next, cyber monday is in full swing. smart phones are sure to be one of the most popular items to buy for the holidays. former apple ceo john skulley wants a piece of that market. here at post 9 the smartphone land and what he sees for apple holiday sales. we'll be right back on "squawk

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as e commerce goes

increasingly mobile, the pressure is on for it to go mobile. john skulley wrote "moon shot." john skulley is here at post 9. good to have you back. congratulations on the book. >> thank you, carl. >> people trying to make sense of this weekend. >> i think it's the wrong way to think about it. you have to think about it as the selling season when 40% of the sales takes place in the last two months of the year. trying to nail it on a particular day doesn't make sense because they're stretching the offers out over weeks. >> do you think it has to do with the nonmallification much shoppi of shopping in this country? >> people are still going to the malls. they're taking their smart phones. they pay attention to what others say than they do the big campaigns of the companies themselves. so it's a big game change. one of the things i talk about

in my book "moonshot," if you want to find the next billion dollar business, it's all about customers in control, customers paying more attention to other customers than the big companies. >> i love the nrf's take on the data which is the economy is so good consumers don't need a bargain so much. that seems like a stretch. >> that's a stretch. everyone always likes a good price. jeff faso says my loyalty only lasts as long as until somebody comes up with a better price. >> how are you getting into this idea of people not just using their phones to shop for holiday sales but they're buying mobile phones as gifts. >> absolutely, sarah. apple's had a wonderful big hit with their iphone 6. it has given me another point of view on the apple watch. i was kind of skeptical about the apple watch but now it's pretty clear that apple's been tuning the software on the apple watch to make it easier, simplify it and say that the heavy lifting is going to be done on the iphone 6.

the apple watch may be a more interesting product than i actually thought when they first announced it. >> did i read you've launched your own phone? >> i have, simon. it's because there's a whole new market for smart phones in the emerging markets in the world which is really budget mobile. we're introducing a world phone for the budget mobile sector. this is the 100 to $150 price point, whereas, an iphone or high end samsung can cost 600 to $800 where the carriers don't subsidize it. >> is that not a crowded space? there are lots of low-cost producers in china. >> absolutely very crowded. products are being made with kmod advertised technology. that's why we got in because as a consumer brander i like a commodity. we're doing all of our industrial design being done in silicon valley. by the middle of next year we'll have all of those pieces

together. we're very excited about the opportunity in a kmod advertised market, budget mobile where we can differ ep she eight and not competing with the apples of the world. >> do you think it's a mistake apple didn't go into that? >> no, i don't, sarah, because apple has been upping its game. it's out maneuvered samsung in the high end market. it's moving into vertical platforms like health and fitness. samsung has been outmaneuvered. >> you're joining us on a day where apple was down 4%, it's now down 3%. some traders wondering maybe they had a black friday weekend just like it appears everybody else did. is that even remotely possible? >> no, it's not remotely possible. apple is doing so well. they've got at least two years of built-in demand for the iphone 6 because apple sells to the people who love it. and the install base loves apple

products. i think that's a complete overreaction. >> john, it's going to be interesting to see how we're having to adapt to the way technology has transformed the holiday shopping season. congratulations again. the book is called "moon shot." >> straight ahead on the program, who will be the winners and losers of this holiday season. a hedge fund manager who focuses on retail. this is an interview you don't want to miss right after this break. how do you beat the number one seed? you just have to win 70% of your points at net. and keep unforced errors under 10%. on the ibm cloud, the us open analyzes 41 million data points from 8 years of competition to uncover key insights. data can help show you how to win, no matter what business you're in. today there's a new way to work. and it's made with ibm. dad: yeah, 20 something years now.

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the holiday shopping season officially underway with black friday now behind us. the national retail federation says total spending fell 11% this weekend compared to a year ago. what does that mean for the rest of the holiday shopping season? my next guest is david durbin. founder of durbin capital. he joins me at post 9. our viewers know you, david. you talked about saa about a year and a half ago. samsung, apple, amazon and the impact that's having overall. a lot of people have taken that piece and run with it since then. do you still believe it? >> absolutely. thank you for having me on. absolutely. i mean, it's just blaing out the way we spoke about it a year and a half ago. especially with amazon, amazon's growth is much higher than people think it is. when you gross out the numbers you get the fee income. it's much higher than the 20%

top line that they've been showing. >> right. i do want to get your take on these numbers this weekend. you're in the malls typically trying to look at traffic. how much should we draw into this number we got from the national retail federation in terms of what the season's going to be like? >> well, i think in some sense it's somewhat of a reality check just in the sense that things were going so well. the stocks went through the roof. 75% of retailers have been reporting earnings. some sales are 5, 10% when before they were flattish. that was kind of a bit strange. part of the reason for that was the weather was really cold as you might know here in new york. it was one of the coldest third weeks in november in 50 years. so people were buying a lot of cold weather merchandise ahead of time. in addition to that among the retailers this year they started at thanksgiving earlier, maybe a week or two earlier, we'll watch for example the monday before, all the other companies. as a result of that, a lot of

the businees moved forward. so we expect to see somewhat of a weak thanksgiving period. what the real number is it's unclear. jim cramer was saying on tv earlier, who knows if this is real. >> that's a survey whereas online we know what people are selling. you can track that. the saa piece is playing out exactly as it should be. our prediction for cyber monday, actually i was doing a little bit of shopping this morning, count help myself, great deals, our predictions for cyber monday to be weaker than expected for the same reasons. people shopping over a greater period of time. tackled merchandise and it's already been sold. in a sense we are optimistic about the holiday season. there can be no question about that. >> so you're optimistic overall about the holiday season although you think perhaps whether it's black friday or cyber monday they may be coming in lower? >> yeah, it's a wake-up call. we're not as optimistic.

>> that goes to the market itself and to the stocks. >> it does. >> you make decisions whether you want to buy or sell short or simply avoid. >> what's really strange and really interesting, every time a retailer, it almost seems every single quarter, when the retailers report, since we spoke about saa, they usually miss numbers. then they say the business has improved this month. it becomes a famous sort of thing like last august three months ago when they all reported. they reported bad numbers but also business has improved. business has improved. go through the companies one by one. then they reported bad numbers. the same thing may be happening. they all reported in the last three weeks and said the same thing. business is improving. >> as an investor, how are you supposed to approach na? the stocks have improved. >> the stocks have improved. the big difference now, which is a big difference, the gas prices have come down so much. that has helped consumer

confidence as well. so you've got like a lot of wind at your back. you've got employment looking good, you've got some of the eke none mick numbers looking good, oil prices looking good, housing looking good, you have a lot of numbers at your back. it's hard to make a poor end and in addition you know i spend a lot of time on inventories. >> i know you do. you've trained me to look at inventory versus sales. we have recent trends. that's looking better, isn't it? >> yeah, the sales to inventory has turned around. sales grew faster than inventories, which is really a good sign for profitability. this quarter 75% have reported. we've collated the numbers. you see sales better than imagery. profitability.

within that there are sections like teen apparel and the inventories are too high. >> taking in all of this, the positive trends when it comes to inventory versus sales, generally positive environment for consumers but perhaps not numbers that are going to make the estimates that people had going into the holiday season. what do i buy? what do i sell? what do you like these days? >> well, obviously i sound very optimistic about the consumer. let's get one thing very clear. we spoke about this many times. saa, they are taking away a huge amount of the dollars? >> that is a huge trend that will continue? >> retail is in secular decline. find a retailer to buy long term is not easy. >> why do you have a retail hedge fund if that's in a secular decline? >> in this market it is a challenge. it is what it is, right?

designing one company to buy -- not buy, that's amazon, then you've got the branded companies that will benefit someone from the, branded companies like under armour, nike, ralph lauren, van hughsen. sketchers. >> why is sketchers one of your favorites? >> it's on fire. top line growing 30% plus their pe in the 20 range is much lower than under armour. that is an amazing company but it's a huge differential. sketchers has gone through a pair of product cycles. you remember those shoes? >> yes. >> it's not a differentiation where it was one product, it's across all products. it's really, really powerful. inventories up 17%. sales up 30%. future profits should be easy to beat. look, what happens six months

from now, nine months from now, this is retail. you've got to follow the trade. >> always something worth buying out there is what you're saying despite retail being in a secular decline? >> yeah, exactly. >> how do you play that real quickly? what's the overall play if you're an investor who believes your thesis? >> well, i mean, it's obvious now in terms of, you know, you could really short the group. the problem is we're in a bull market, aren't we? look what's happening to the products. if you gave out the names you would be out of business quickly. you have to wait for a bear market or some market that is flatsish. great companies like macy's, very well run, target is a good company, well run, but these companies have uniformly lowered numbers. they lowered numbers a few weeks ago. the stocks set a high. it's not easy to short the names and to go long, the oil prices really should help a lot of the companies like walmart and

target. if one wants to do that, the limited brand, great company on fire. they should beat numbers hand dilly. >> we've got berman to talk a few stocks. >> why would you? you only run a hedge phone. as always, appreciate your time. >> thank you. appreciate it. >> back to you guys. when we come back this morning, it's cyber monday. online retailers counting on big numbers. the founder of benobo will be here. coming up later in the day, the president of the new york fed, william dudley sitting down with our own steve leaseman at 1:30 p.m. eastern time. we'll be right back. ♪ my baby drove up in a brand new cadillac ♪ ♪ look here, daddy, i'm never coming back ♪ discover the new spirit of cadillac

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welcome back to "squawk on the street." we're watching shares of amazon not just because it's cyber monday, but news that moody's changed the company's credit outlook to a negative rating

while looking at the senior unsecured rating saying that the outlook is due to the company's announcement that it was issuing new debt. amazon shares down 2 to 3%, carl, on the day. back to you. >> let's get the santelli exchange. hey, rick. >> good morning, carl. i'd like to welcome our 1st of december guest, matt mali. thanks for taking the time. >> always great to be here. >> listen, we've heard a lot of talk about normalization, but let's stick with the fundamentals with the first part of this conversation. gdp and much of the european sector is weak especially germany and yet their stock market came close to 10,000 today, very close to all-time record levels. what are your thoughts about the relationship between germany and the fundamentals and equities? >> well, it just seems to me that we're still getting a situation where you have qe andersen tral bank stimulus really having a big impact on

the stock market. as you mentioned, germany's growth was negative in the first quarter, barely positive in the third quarter. we have the prime minister of the u.k. saying they're on the brink of another recession and yet their stock market is up 16% in six weeks. this is talking about germany. up 16% in six weeks. it's within 1% of an all-time high. so the fundamentals aren't as strong. as long as global central banks are adding stimulus, it's holding up stock prices. >> you know, it just seems to me a perverse relationship between energy and global economies when you look at germany, they've had a lot of issues regarding putting coal back online because alternatives to fossil fuel just aren't taking up the slack. we look at japan, an island with no energy. falling energy prices, obviously good for manufacturing. any business in the economy but

yet it's putting deflationary pressures foremost in central bankers' minds. is this logical in your opinion? >> well, it really isn't, but at the same time, you know, something we've talked about in the past. they seem to be more market dependent than data dependent. every time the market goes down in any kind of way, they get nervous and step back on the gas peddle. one of the things that we go back to is that we have -- you know, we have -- look what happened. we had the gdp number for the u.s. being a great revision and yet the bond market, we've seen yields drop since then, somewhat significantly. we're back down below 2.2%. we have some underlying issues. >> matt, let me interrupt you there. >> sure. >> we're very close to the settlement on october 15th, which was 214, a day we settle 28 bases point higher than the interday low yield. for the last answer, we're out

of time, what do you explain the recent surge in buying that started early friday and still continues at this point in treasuries? >> well, it's got to be one of two things in my opinion. it's either got to be that the growth is not as strong as people think it is or as a lot of the pundants say it is or number two that we're moving towards another flight to safety move in the overall markets. the bond market usually sees it first. we're starting to see that in the last couple of days. >> thank you very much, matt. the only thing i could think of that the bond market might see coming is the spreading of weakness through systemic transmission lines via europe. thank you for taking the time. "squawk on the street" gang, it's yours. coming up on the program, the co-founder of paypal will join squawk alley live. offering consumers a new way to buy gifts this season. it could mean serious competition for the banks. we'll be right back. and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k)

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we're for an opens you internet for all.sing. we're for creating more innovation and competition. we're for net neutrality protection. now, here's some news you may find even more surprising. we're comcast. the only isp legally bound by full net neutrality rules. . and after a big weekend of sales companies are now in full swing for today's cyber monday

including the clothing retailer bonobos. joining us is the founder and ceo andy dunn. good morning. >> good morning. >> is this a new look that you should be wearing, jacket outside your coat? >> it's warm in new york today so i was trying to, you know, pull it all off without outer wear jacket. >> i mean, is this what people are going to be wearing moving forward? seriously. reversing stuff like that? >> once they see this segment, it's just going to take off. >> i'm confused. the website offers 30% off. >> yes. >> correct? today by using a cyber monday. i thought that was great until i realized that the gap and old navy and banana republic, they're offering 40% off today. >> yeah. >> is it getting tough out there? >> so what we did at bonobos.com is 30% and air.com up to 60 to 65% because it is a highly promotional time. >> don't you expect in your world in fashion for you to get the discounts towards the end of the holiday season? this is supposed to be heavy discounting for electronics only

at the beginning of the season. isn't it? >> we saw the news over the weekend about down 11% so we felt lucky so nar we're having an awesome holiday. but it is a time of year i think where online in particular, price is such a powerful motivator. because the whole system has become more promotional the impact of this weekend may be difficuminishing because it see like almost every day there is an event or offer. >> are you making money at this sort of level if. >> we're surprised at how well things are going on on our side. a lot of it is our stores. we're profitable in our stores a lot more full price selling. ten of these guide shops. all about customer service. >> the question is are you actually making money with a 30% discount online today? do you still have substantial margin left in that? >> there is some margin, yes. >> we've been having the discussion all morning long. how important is cyber monday versus just the entire quarter? the holiday sales, period, especially with the disappointing numbers over black friday. perhaps black friday is not that important anymore.

>> i think today is huge. in our business we're built online. the idea was the internet can enable us to offer great clothes and great service. this this this day, this is the super bowl of e-commerce. this is a 10x day for us compared to the holiday. tep times more important than your average holiday. >> people after this weekend especially are wondering about the long-term stability of the mall. we've had you on several times about the mix of bricks and more ors and online. do you feel like your returning into the wind when it comes to physical space, physical retail space? >> our sfotores are different. you touch and feel the product, you try it on. we don't stock our inventory there. we have ten guide shops right now. we think it's the reinvention of the retail store. we will open ten more next year and a number of them will be mall locations. top malls are as strong as ever. >> how do you differentiate what's a top mall and what's not? >> it's a function of the brnds that are there, the growth that they're seeing, the sales per square foot productivity and i

think one of the realities in our country right now is people doing well are doing really well. we've got headwinds, i think, in c malls and d malls that we're not in a great position to comment on but for the top malls out there we're optimistic. >> any retails you want to be nearby? >> we love apple, we love tesla. they're innovative. there are brands outside of the apparel space that we admire. >> are skinny suits over? >> part is what has built us is more structured move toward tailored silhouettes. perhaps the era of skinny of sinniest jeans for men is behind us. >> all right. now let's go over to the always fashionable jon fortt with a look at squawk alley. >> we have a great show, we have max, the cofounder of paypal. yahoo! board member will be joining us. also, the cofounders of parker,

trying an innovative approach to cyber monday and the head of amazon books in kindle in a season that's turning out to be increasingly digital. all that and more coming up on "squawk alley." [time warp explosion] yes! where have you been?

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65 points, retailer is a key focus of the cyber monday. best buy very interestingly has had a real tough open so far today. of course the website crashed twice on friday. general concern about where we are now on the data coming through at the macro level. another one down is game stop. we interviewed the president on friday. there was always concerns about gamestop with digital downloads. they've extended their cyber monday afters throughout the rest of the week. >> checking on the broader markets here we're seeing the dow falling 70 points. off the session lows for the morning. red arrows across the screen. s&p 500 down 0.9%. big week ahead topped off by jobs day on friday. we'll be watching also the data from overseas as well as drop in oil. >> let's send it over to "squawk alley" and the gang. >> thanks. it is 8:00 a.m. at amazon headquarters in seattle, washington. 11:00 a.m. here on wall street. "squawk alley" is live.

♪ welcome to "squawk alley." markets not quite back in black but progress after being down 80 points. roger mcame and john steinberg is here at post 9. jon fortt, cale kai la, of course, as always. first up, cyber monday. fewer people shopping in stores while more and more continue to spend online for the holidays. according to adobe, both thanksgiving day and black friday saw double digit